City AM - October 2016

KEIL HUBERT All the easy digital gains have already been realised

SHELF LIFE How AI will soon be in charge of product displays

TRANSFORMING THE WAY WE WORK Apprentice winner Joseph Valente on bringing his plumbing business into the 21st century

Page 2

Page 7

Page 4

AWARD-WINNING BUSINESS JOURNALISM • OCTOBER 2016

BUSINESS-REPORTER.CO.UK

The perfect match Joanne Frearson on how pressures producing the football highlights led to digital transformation at ITN

INSIDE: How passwords aren’t necessarily enough protection for your data in the post-AI landscape DISTRIBUTED WITHIN CITY AM, PRODUCED AND PUBLISHED BY LYONSDOWN WHICH TAKES SOLE RESPONSIBILITY FOR THE CONTENTS

The Digital Content Summit 2017 Customer Focus Live 2017 sav Royal Garden Hotel, London 23 May 2017

e

50%

50% off early-bird tickets now available For more information or to register, contact Lace Bryant on 020 8349 6496 or email lace.b@business-reporter.co.uk digitalcontentsummit.co.uk customerfocuslive.com

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

2

business-reporter.co.uk

Business Reporter UK

@biznessreporter

Deploy new technologies deliberately, and with careful planning, if you want to avoid a catastrophic collapse OPENING SHOTS KEIL HUBERT

Y

OU CAN call it “Internet Revolution,” or “Digital Transformation,’ or any other hip marketing slogan, but it’s all the same thing. Businesses fling obscene piles of cash at consultants in order to secure massive and swift competitive advantages, only to wind up burdened with tech support quagmires… and no compelling competitive advantage. I don’t mean to come across a curmudgeon, but we technologists have been at this for thirty years. All of the easy gains have already been realised. There aren’t any more magic leaps forward to be had, espec ia l ly not for businesses which have kept up with t he i ndust r y standards.

I understand the appeal, though. I recall when email was new. Getting to instantly correspond across

oceans was exhilarating when everyone else had to wait a week for a mailed letter. Getting to edit complicated forms on a PC instead of retyping them from scratch after every noticed error massively reduced workplace stress. Being able to search enormous regulations for keywords cut research time from days or weeks down to minutes and saved jobs. Heck, even getting students to laser print their essays made grading papers an order of magnitude less exhausting (if no less insipid). Technology transformations have given us stunning improvements in office quality of life. I’m a diehard fan of new tech.

The thing is, we’re well past the days of Huge Leaps Forward.

Everyone has email and web forms now. To corrupt cyberpunk science fiction writer William Gibson, the future has arrived, and much of it has been commoditised. Pretty much anyone with a white-collar job can do most of their work with a Wi-Fi hotspot, a smartphone and a £100 laptop. We have “work from home,” 24/7 access, and virtual everything. The

The European Information Security Summit 2017 Building an agile cybersecurity culture Etc Venues County Hall, London 21-22 February 2017

For more information or to register and benefit from our pre-launch discount, contact Lace Bryant on 020 8349 6496 or email lace.b@business-reporter.co.uk www.teiss.eu

“All of the easy gains have already been realised.

There aren’t any more magic leaps forward”

KEIL HUBERT IS A RETIRED US AIR FORCE CYBERSPACE OPERATIONS OFFICER, WITH MORE THAN TEN YEARS OF MILITARY COMMAND EXPERIENCE. HE CURRENTLY CONSULTS ON BUSINESS, SECURITY AND TECHNOLOGY ISSUES IN TEXAS

save

50%

pre-launch discount

“digital future” has long since been and gone.

That being said, the marketplace won’t stop making grandiose prom ises of “revolut ions”.

Electronic bookkeeping isn’t enough – now you need Enterprise Resource Planning! Email is so last year – now you need Enterprise Collaboration! Whatever you already have working, there’s always a much larger, more expensive, and staggeringly more complex new version of it that your business absolutely must have if you want to stay relevant. Just ask your favourite consultant: they’ve got slides aplenty explaining why your business is completely doomed if you don’t upgrade, iterate, federate, move to “ t he c loud ” a nd TRANSFORM! TRANSFORM! TRANSFORM! It’s exhausting.

Yes, there are new capabilities to be won from adding new arrows to your allegorical quiver. Just remember that every new system you deploy brings with it a new and inescapable tech support burden.

Further, most of these “transformative solutions” force you to trade simplicity for capability. That’s

often a losing proposition. The “huge” gains in productivity that the consultants promise can’t be realised without also introducing momentum-sapping drag.

Is it worth it? It can be if you’re realistic about it. Massive tech transformations can add value and can secure you a competitive advantage. They’re never quick, though. They’re also never cheap, and they’re never, ever simple.

Modern businesses are already saturated with technology, most of which is huge pain to support and secure before you go and overcomplicate it. Everything that’s added to the pile makes the whole mess harder to sustain, thereby increasing the total support burden.

If you want to avoid a catastrophic collapse, deploy new technologies deliberately, with careful planning and meticulous testing.

As for your favourite consultants – the ones who promised you overnight success – shoo the lot of them out of the building. If you can’t secure the “grand transformation” they promised with your own IT staff, you’ll never be rid of your cheerful £300/hour “partners”.

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

facebook.com/biznessreporter

3

info@lyonsdown.co.uk

How instant football highlights sparked a technological revolution at ITN studios Joanne Frearson talks to the broadcasting company about how outsourcing to a data centre saved time and money across the board

“Digital transformation is about stopping thinking about vertically integrated silo technology to move towards horizontal systems that can provide multiple purposes for a business” – Michael Winterson, Equinix

D

IGITAL TRANSFORMATION is changing the way football fans watch the Championship. ITN, which packages together content for the Football League, is using new digital technologies to provide this footage for the fans in real time, as well as giving them highlights not long after the game finishes.

“Technology used by broadcasters is continually advancing,” says Bevan Gibson, CTO of ITN. “We had a project to provide live recording as well as editing for the Championship and Leagues 1 and 2. We had to make 10-minute highlight packages of each game, which needed to be delivered very shortly after the final whistle.”

Up until this point, goals highlights from League football matches were traditionally shown later on a Saturday or Sunday night on programmes such as The Football League Show. ITN needed to find a way that could provide them right after the game ended.

Historically the broadcast equipment at ITN has been very near to where the production company is based, at Gray’s Inn Road in London. But in order to bring the football footage out quickly, ITN needed to upgrade its existing in-house infrastructure or use a different system.

“We looked at how we could provide this service and one of the options was to increase the size of the infrastructure we have at Gray’s Inn Road,” he says. “We traditionally built infrastructure to support peak events. But the cost of having all these locations connected live, and having the highlights edited shortly after the game, was just not possible because the cost associated with doing so did not make commercial sense and no one was willing to pay for that.

“The second option was to look at putting some equipment in a shared location not available at Gray’s Inn Road, where the costs per square foot were more effective than doing it in more central London.”

ITN eventually decided that the best way to deliver content for the 1,813 Football League games it was to produce each year was to use a data centre or colocation ser vice. In 2015 it approached data centre provider

Producing fast turnaround highlights for football games led ITN to consider outsourcing other pieces of key infrastructure

Equinix and rented some rack space to house its equipment so it could deliver content quickly to football fans.

Using the Equinix data centre, production footage can be transferred between media outlets in a faster-than-real-time process, through fibre networks. ITN now plans to use this type of service to deliver content for its other services. The company has a range of production businesses and makes news for ITV, Channel 4 and Channel 5.

Gibson says: “Our approach going forward is to put a base level of our infrastructure into a co-location such as Equinix and bursts into public cloud providers like Amazon, Google and Microsoft Azure to pick up that load when you have big events that come up.

“We need to better utilise the equipment that we have and build a system for that peak load day. That might be for a massive news story. That might be for an election.

It might be for a big sporting day. Strategically, what we are doing with Equinix fits into our roadmap really well.

“You think about it from a news perspective – you build a system for a one-in-five-year event, and most of the time when you are doing runof-the-mill daily news it uses a

1,813 The number of Football League games ITN produces each year

s m a l l p e r c e nt a g e of t h at infrastructure.”

The goal for ITN is to eventually have no equipment at its central London location, moving it instead to a co-location environment or public cloud.

“We are going to have to have a very good reason,” he says.

“Why would you install in Gray’s Inn Road over a co-location env ironment? We don’t want anything there because it is not cost-effective. That means all other parts of all business, including news and 60-minute factual documentaries and the other series we create.

“We will look at increasing any investment of any sides of those businesses in the future and we will look at alternate off-premises locations for that equipment. It will be everything we do in the next couple of years.

“That is the key in transforming the business. That may mean it is more cost-effective for us to get into other markets that may have been less accessible in the past. It means customers that are requesting those services from us can get a better product for a cheaper rate essentially, and that is where we see the transformation.”

According to Michael Winterson, managing director of Equinix

Services, “in the past you typically built a digital system as a discreet application and you put all the infrastructure behind it and it was usually living in a silo. Data didn’t transition quickly between the divisions.

“Digital transformation is about stopping thinking about vertically integrated silo technology to move towards horizontal systems that can provide multiple purposes for a business.”

A co-location also has the advantage of having other media outlets such as Sky, Channel 5 and the BBC in the building, which means ITN can distribute its material to them quickly, creating a business ecosystem.

Gibson says: “That is one of the benefits we found and the reason why, with the Football League, we went down the Equinix route because a number of other media organisations we need to deliver content to are also Equinix customers.

“We can interconnect with their infrastructure and they can interconnect with ours within that same facility, in a far more economical fashion than by running a full-time connection from ourselves to their facility. It is a media meeting point.”

Renting rack space from data centres now enables media companies to provide their customers with material at a far more agile pace – and just as importantly, at considerably less cost.

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

4

business-reporter.co.uk

Business Reporter UK

@biznessreporter

Plumb job: how winning The Apprentice brought a boiler specialist into the 21st century After getting the nod from Lord Sugar, Joseph Valente decided to bring his plumbing business up to speed with the digital era. Joanne Frearson reports

N

Joseph Valente with Lord Sugar after winning last year’s The Apprentice

EARLY A year after winning The Apprentice, Joseph Valente’s plumbing business ImpraGas, thanks to a £250,000 investment from Lord Sugar, has grown from a small firm in Peterborough to a nationwide company – largely thanks to digital transformation.

After leaving school at 15 to work as a plumber, then a gas engineer, London-born Valente read Sugar’s autobiography – and felt ever since that one day that he would work with him. Appearing on the show in 2015, Valente beat 60,000 applicants to the prize, and Sugar is now his business partner.

ImpraGas has grown substantially since Sugar’s £250,000 investment, and Valente tells me that the most effective way to e x p a n d t h e c omp a ny h a s b e e n through technology. “We made the decision to rid the company of manual processes and paper-based systems that created inefficiencies and limited our potential,” he says. “It has been revolutionary over the last five months. It is improving the efficiency because we are able to log and track all of the details.

“Instead of having to do stuff manually, like emailing quotes and writing them up, it auto-links everything together. You put the information in once and it populates itself in a number of different areas.

“What it means from an engineer’s perspective is that when they are on site in a customer’s property, they are able to streamline their paperwork activity because everything is done on the tablet rather than having to use a number of different notepads, potentially making mistakes and having to rewrite everything.

“It allows you to capture all of the information – from pictures to customer satisfaction forms to safety legislation forms – all in one area. It basically means it improves the time the engineers spend on a job.”

The system ImpraGas decided to use to undergo this digital transformation was by using an app called JobWatch, which helps planning, managing, scheduling and

tracking mobile workforces. “If we hadn’t implemented these changes into our business model, this would have impeded on our growth potential due to the inefficiencies and inaccuracies of traditional procedures,” Valente says.

The JobWatch system developed by BigChange allows customers to be able to book jobs as well as receive live updates confirming the estimated time of arrival for the engineers, and electronic job cards, including certificates related to the job performance.

Introducing the new technology has allowed Valente and Lord Sugar to concentrate on growing the company as quickly as possible, from a team of just seven engineers to a nationwide firm.

Valente says: “Streamlining areas of the business gives us time to focus on improving other areas of the business. It means that while competitors are still using manual processes and paper-based systems, we are a step ahead of them – booking jobs on the go and instantly receiving feedback for our service so we are able resolve issues quickly.”

The system has also enabled ImpraGas to deliver faster response times and better quality of service to customers, as well as improved fleet management, helping to

“We’re trying to get away from the send-in-a-guy-with-a-notepad-and-a-dirty-van type thing and bring the business realistically into the 21st century” – Joseph Valente

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

facebook.com/biznessreporter

5

info@lyonsdown.co.uk

The ImpraGas team react to their boss’s triumph; inset left: Valente with ImpraGas’s game-changing booking software

reduce mileage and CO2 emissions. Bookings using the system have increased to more than 3,000 in the last six months.

JobWatch is not the only system ImpraGas is using to transform the business digitally.

Valente is also using Skype and FaceTime to give quotations and surveys in a person’s home, without the engineer having to be physically present. He says: “It is working very well for the new-age customer, who is time-poor and does not have time to book an appointment. We can get the same amount of information from that survey.

Also, we are using video animation to get points across social media – from pitching our products, to understanding customer benefit and which products are used.

“Rather than having a person pitching a product, we are putting together the key information into a short animated video.

That allows the customer to [be aware of] the benefits of using ImpraGas in their home before they have one of our surveyors come around.

“We are trying to get away from the old send-in-a-guy-witha-notepad-and-dirty-van-type thing and try to streamline the business and bring it realistically into the 21st century. We are looking all of these ways to innovate and to grow using technology.”

It’s certainly a way to ensure that customers have an understanding of the products and have done all their research before someone comes to their home. “It’s basically all about reducing the amount of time it takes to get the installation booked in,” says Valente. “It is also something that our competition isn’t doing.”

Valente and Lord Sugar are also looking at introducing video customer feedback.

Instead of a customer writing something up online, Valente wants to see video reviews which show customers sitting next to the finished product from ImpraGas and talking about the installation process to try and bring it alive a bit more.

“Technology is very important, and we incorporate it into our business in as many ways as possible,” Valente says. “Gone are the days of going around to a customer’s house with a notepad, then sending them a quotation two weeks down the line from some old scrappy plumber. That is not what we are about.”

Plumbing might not be seen as a typically glamourous, tech-savvy industry, and Valente is taking steps to ensure it does not get left behind by the technology revolution.

“There are a lot of clever little ways that we can bring in technology to support us and help us grow quite quickly, without having to put a lot of money into resources,” he says. “We have seen the business grow substantially. It has been taken on board by our customers very well. They like the fact that they have that option.

“They do not have to go the traditional route of having a person around to quote.

It has streamlined our whole operation

– it is probably the most important thing to be able to give you a quote as a whole.”

Valente believes technology is the future when it comes to keeping our houses nice and warm. The digital transformation taking place at ImpraGas is not just about improving the company’s paperwork management and logistics – it is also about keeping customers up to date with the latest technology.

“We are doing a lot of smart technology too,” he says. “A lot of different techniques from a control perspective. It is allowing customers to have smart technology installed so they can control their central heating system and hot water from a distance. They do not actually have to be at home – they can use their iPhones.”

Valente’s business has certainly gone from strength to strength since the investment from Lord Sugar. The show has returned again to our screens, where another group of candidates are vying to become Lord Sugar’s next apprentice.

Video campaigns from Human capital

HUMAN CAPITAL

SPOTLIGHT ON… • Connected ecosystems • Data analytics • E - Learning • Leadership

Cloud

CLOUD

SPOTLIGHT ON… • Hybrid cloud • Cloud security • Emerging markets •D igital transformation

Digital transformation

DIGITAL TRANSFORMATION

SPOTLIGHT ON… •C ustomer experience • Digital strategy • Data management •C ommunication strategy

Disruptive technologies

DISRUPTIVE TECHNOLOGIES

SPOTLIGHT ON… •S oftware development •D igital transformation • Predictive analytics • Mobile technology

To watch these videos, and for more information, go to business-reporter.co.uk/category/video

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

6

business-reporter.co.uk

Business Reporter UK

@biznessreporter

Post-AI protection must mean more than passwords As artificial intelligence gets smarter, we need stronger ways of protecting data, according to ethical hacker Jason Hart JOANNE FREARSON

U

sing an undisclosed London restaurant’s public Wi-Fi system, ethical hacker and CTO of digital security firm Gemalto Jason Hart does a quick Google search to see if we can find the usernames and passwords of companies’ private files. Within seconds we are in, and before us is the sensitive information of nearly 300,000 companies.

“What I am showing you is a small insight into the hacker world,” he says. “These companies have all been hacked and their usernames and passwords are there for the bad guys to potentially gain administration access. This is not technical.

You can do some very basic stuff to compromise an organisation.”

What he is showing me is no more than a routine exercise for him. It is something a 10-yearold could do. It is also scary, given the huge volume of sensitive information his search pulls up.

Hart tells me hackers are using data like this to break into websites, gain admin access and take online credits and online payments. “Most breaches start with a password being compromised, obviously. If they weren’t using passwords we are already solving the problem.”

One of the reasons Hart believes some companies are becoming increasingly vulnerable to this type of hacking is because while they are upgrading systems to digitally transform themselves they are not putting the right security in place.

Statistics from Gemalto show that 707,509,815 data records were lost or stolen in 2015, the equivalent of 22 every second.

“About 12 years ago we were starting to do things right,” he says. “We all had laptop computers, we all had a virtual private network (VPN) and we thought, let’s protect the laptop, let’s control access to the network, and then this kind of digital disruption happened.

“At the end of the week the server would be backed up on a backup tape and that backup tape would be stored in a safe. We were applying a physical control. But now, because of digital disruption, we don’t use backup tapes – we back up into the cloud. That physical control we were once using is gone. You have digital disruption, cloud transformation and it is removing some of the basic simple things that we were doing as it just happened. The backup tape and the safe is a good example of how some of these basic controls are being lost.”

The attacks, which Hart believes will become the most prominent from criminals using this data, will be integrity attacks, where a hacker gets into a company’s administration system and uses it to make orders and compromise the way it does business.

He says: “Integrity attacks will bring huge impact because it is too late. It is irreversible. If the output has been manufactured you can’t reverse it.”

Hart says we are only at the beginning – as companies start using artificial intelligence, the internet of things and machine learning more, their data footprints will increase, and so will the attacks. “We are in a world now where businesses own or use other people’s data,” he says. “[But they also need to] respect that it is someone else’s property, so the appropriate security controls should be given.”

His advice is for businesses is to replace permanent passwords with a one-time random password. “If you are storing data or anything in the cloud you should encrypt it,” he says. “Then you need to protect the key which secures the encryption. This stuff does not need to be expensive – if it is done from day one it is part of the overall cost.”

Automation will play a central role in tackling public sector challenges “There is now an urgent need for public sector leaders to radically transform how services are delivered”

Debra Maxwell is CEO, CRM Solutions UK & Ireland, Arvato

D

ISRUPTIVE TECHNOLOGY has continuously provided society with the key to unlocking new potential.

From the Spinning Jenny, which sparked the Industrial Revolution in 1754, to stemcell research and mobile internet, it has incessantly transformed how we live, work and learn.

Autonomous, cognitive technology will be at the forefront of the next wave of change.

Already poised to transform the transaction processing landscape in finance and the entire concept of transport through the self-driving car, robotic automation holds huge potential to help almost every industry boost productivity.

One that could benefit enormously is the public sector. With the financial challenges mounting and the pressure on public services increasing, there is now an urgent need for leaders to radically transform how these services are delivered. In the search for a solution, it’s no surprise that many are sitting up and paying close attention. A survey of 134 local and central government decision makers, undertaken by Arvato in partnership with iGov during the summer, found more than half the respondents say their organisations have explored using automation, with 21 per

cent expecting their department to trial it over the next 12 months.

The public sector is no stranger to using technology to drive new efficiencies. The digital-by-default agenda, which has seen progress made in online service delivery, helping citizens to self-serve and integrating social media into customer services, has made a significant difference, particularly across local government. But as gains made from improving the same ways of working become

increasingly marginal, public sector leaders must look to more radical change.

In a project with one of our local government partners, Sefton Metropolitan Borough Council in Merseyside, we’ve been able to prove that robotic process automation (RPA) can play a central role in delivering this change. The high volume of repetitive, administrative tasks in a council’s back office places a large burden on employee time and skills, and by automating these processes

we’ve been able to achieve major new efficiencies.

The project uses cutting edge automation software from developers Blue Prism in Sefton Council’s revenues and benefits department, replicating a number of transactional processes with 100 per cent accuracy and significant improvements in speed. For example, Council Tax Direct Debit input times have been reduced by 80 per cent, with single person discount handling times cut by half.

Removing repetitive tasks from employee workloads has also improved job satisfaction, while freeing up a number of staff up for tasks that are becoming increasingly critical for local authorities, such as handling citizen enquiries and eradicating fraud.

Given the technology’s potential to deliver similar benefits across all government departments that deal with large numbers of repetitive processes, it’s clear that robotics automation could provide the transformation the UK public sector has been looking for.

INDUSTRY VIEW

Visit www.arvato.com/businessreporter to download Arvato’s white paper, Driving Transformation through Automation in the Public Sector

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

facebook.com/biznessreporter

7

info@lyonsdown.co.uk

Shelf life: how AI will soon be in charge of product displays JOANNE FREARSON

R Contact centres investing heavily in automation

T

HREE QUARTERS of the contact centre outsourcing (CCO) sector invested in enabling technologies in 2014-2015, with analytics, automation and multi-channel tools being the major areas of investment, according to research from consulting firm Everest Group.

“Contact centres across the world are moving into the digital era with a focus on enhanced customer experience in a multi-channel environment,” said Katrina Menzigian, vice president at Everest Group. “Service providers are responding by shifting their value proposition from the traditional, full-time-equivalents (FTE)-based focus on cost containment and implementation to an emphasis on providing insights and innovation to enhance the customer experience.”

There was also an increase in onshoring activity in 2015 as buyers increased their focus on improving service quality and demonstrated a preference for agents located close to customers.

In 2015, the percentage of CCO contracts with significant onshore delivery rose to 53 per cent, compared to 35 per cent in 2010 and 49 per cent in 2013. This trend has also led to the growth in adoption of a work-at-home agent’s model, which incurs lower operational costs than onshore FTEs. The research also showed that the CCO industry is more focused on value-added services such as performance management, customer retention, customer analytics and channel management. The study also found benefits in automation such as increased customer satisfaction and loyalty, decline in fraudulent activities and reduced average resolution time.

According to the Everest Group, automation has, through the reduction of repetitive tasks they would otherwise have to perform, helped to empower agents to focus more on solving complex customer problems. Automating systems can also predict customer’s problems and can help proactively solve them even before the customer has realised there is one, improving customer satisfaction and loyalty.

Overall, the global CCO market grew at a rate of 4 per cent in 2015 to reach $75-78billion.

The global contact centre spend stood at $300-320billion, of which third-part y outsourcing accounted for approximately 25 per cent.

ETAILERS ARE looking towards artificial intelligence (AI) such as image recognition technologies to help enhance sales staff productivity as well as make them be more competitive against their peers.

Alexander Laugomer, project manager digital merchandising at consumer and industrial goods firm Henkel, says: “The major benefit of the AI technology is that it not only provides us with information on our own and our competitors’ products, but it also gives us an actionable report straight to our mobile devices.

“This allows our sales reps to improve our brands’ situation instore there and then, without the time-consuming task of manually compiling data.”

Henkel outsources this function to retail image-recognition firm Trax. The technology works by being able to recognise more than eight million images on a shelf. After recognising the products, the artificial intelligence system gives the sales staff real-time recommendations on what needs to be done to give them a competitive advantage in the marketplace.

The technology is designed to help improve productivity and reduce the time an employee needs to spend checking inventory on store shelves, as well as gathering analysis about things such as shelf location and different types of promotions.

Laugomer says: “The software provides an electronic list that is entirely objective and significantly more accurate than previous manual processes, which are obviously prone to human error.”

Research has shown that retailers were investing in smarter analytics and technologies to gain a competitive advantage and improve the experience of the customer.

A survey by KPMG International and The Consumer Goods Forum showed the usage of techniques such as predictive analytics, customer path-to-purchase analytics, and artificial intelligence were expected to double over the next two years, to 59 per cent, 54 per cent and 43 per cent, respectively.

Trax’s technology gives retail staff realtime analysis of how their products are performing

Usage of AI techniques in retail Over the next two years, the percentage of retailers using AI is set to increase to:

59%

…using predictive analytics

54%

…using customer path-topurchase analytics

43%

…using artficial intelligence

SOURCE: KPMG/CONSUMER GOODS FORUM

The research also found 29 per cent of firms surveyed currently use data analytics, with this proportion expected to double to 58 per cent in the next two years.

Willy Kruh (inset, below), global chair of consumer markets at KPMG International, says: “Companies need to gather and analyse as much circumstantial, situational and demonstrated behaviour data as possible so they can start to understand the motivation for why, when and how a consumer makes a purchase decision at any given time.”

Companies in the drinks industry have been using Trax AI to help make them more productive. In 2014 Coca-Cola gained 1.3 per cent in market share within five months and was listed in Australia’s BRW Maga-

zine’s 50 Most Innovative Companies after using the technology. The soft drinks giant was able to get real-time images of its products in store, giving sales staff insights into any performance gaps, so that they could apply corrective actions in the store as soon as problems were found.

Elsewhere, beer manufacturers have been using it to better manage their stocks, gain greater visibility into trends across markets and improve their ability to predict and respond to competitor behaviours.

It has also helped beer brands make sure their products have been placed on the shelf during peak periods.

According to Joel Bar-El, CEO of Trax, fast-moving consumer goods (FMCG) companies spend about $70billion on shelf merchandising standards, buying shelf space and marketing materials, promotions and exhibitions.

Companies positioning their products in-store can get the maximum number of people seeing their products, thus potentially improving sales. And through using AI imagerecognition technology, they can use real-time analysis of how their products are doing on shelves, giving them the best sales potential.

Dror Feldheim, co-founder and chief commercial officer at Trax, says: “Retailers turn our data and insights into broader market intelligence and highly accurate trend predictions that shine a light on new ways to improve their customer experiences in-store.”

The technology is also being used by companies in conjunction with their loyalty programmes, so consumers can look at the shelf digitally and make smarter choices. They can use it to filter specific products on shelves, such as gluten-free or lowfat, for example.

October 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH CITY AM

8

business-reporter.co.uk

Business Reporter UK

@biznessreporter

A wake-up call for businesses Coffee shop connectivity is ensuring the digital revolution is full of beans. Here, one of its chief architects grinds out the detail…

73% Percentage of SMEs who admit to not embracing digital possibilites Source: Daisy Group Digital Survey 2016

F

OR MORE than 500 years the humble coffee bean has punched way above its weight.

First drunk by the natives of Ethopia in the 15th century, it is now sipped by billions of us every day. No surprise, then, that it occupies a neat and surprising position at the very heart of the digital revolution that is changing everything forever.

As the inexorable march of online shopping changes the landscape of our high streets, more and more retail outlets morph into coffee shops and cafes. And if that in itself wasn’t a potent enough symbol of the relentlessness of change, there is the seemingly crucial requirement of coffee shop Wi-Fi to compute too.

For in today’s always-on age, coffee without a connection is unthinkable. And for the coffee shop owner, robust and reliable broadband has become a commercial differentiator – as equally effective in delivering healthy bottom-line profit as any of the best Brazilian blends available.

It’s evidence that digitisation has hit the mainstream. And, strikingly, the coffee shop’s digital strategy is as commerciallycrucial as that of the wsorld’s biggest banks: trying to figure out how to cope in a cashless economy.

Nathan Marke (pictured, far right), chief digital officer at Daisy Group – the UK’s biggest independent provider of converged communications and IT – is starkly clear: “In five years there could be only two types of business in existence,” he says. “Those that are embracing the internet of things, and those that are slowly going out of business.”

Hyperbole? Well, almost everything the free market economy is based on – everything we manufacture, trade, drive, use, play, and work with – is getting equipped with micro-sensors in order to optimise the supply chain.

And Marke believes businesses will either embrace and adapt to the IoT, and become more efficient and productive, or they will simply go bust. “It really is that simple,” he adds. “Businesses that think digital is only about changing a customer experience are missing the broader robotisation going on around us. They need to get their heads around this change and find the time to work out a digital plan.

“This is a big challenge for all businesses, but it is perhaps most acutely felt in the UK’s small and mid-market companies. While being smaller and more agile should give tremendous advantage in the digital economy, without the headroom and the teams, and with the weight of old technology

NEIL ATKINSON

“Businesses that think digital is only about changing a customer experience are missing the broader robotisation going on around us” – Nathan Marke, Daisy Group

on their shoulders, the SMB engine of the UK economy is reacting too slowly.

So what is it that makes a digital business successful? What are the tenets of the Ubers, the AirBNBs, the Netflixes, and the other poster children of the digital revolution?

Well, behind those extraordinarily brilliant ideas are some infrastructure fundamentals that enable them to be agile, and to scale and monetise their seeminglylimitless potential.

In essence, they are businesses that have the three essential foundations of digital off to a T – and they are reaping the benefits. First, they are connected and protected.

“Businesses must stop treating the network as something tactical, and start treating it as strategic,” says Marke.

“Daisy’s job, as an end-to-end provider in this connected world, is to get the customer thinking about the network in terms of the experience, rather than a set of switches, wiring and transmissions.”

Second in that list of essentials is an always-on infrastructure. The rate at which new software and services are being developed means that, in order to succeed against the competition, the speed at which a business gets to market has never been as important.

Without agility and elasticity, hard-wired into a business’s infrastructure, that’s near

to impossible. And, as well as flexibility, computing and storage infrastructure must be more reliable than they have ever been.

“For many businesses, these two requirements of agility and reliability create a conundrum,” says Marke.

“While they are trying to make something really responsive, they are concomitantly trying to make it incredibly reliable and lock it down to make it really secure.

“That is one of the biggest battles for IT – how to get the balance right so that it can be really agile and really reliable at the same time.

“This creates interesting technology challenges – how to enable incredible elasticity in your ‘stateless’ computing environment, whilst bullet-proofing your ‘stateful’ storage environments to make your data indestructible. This will require finding a way to use the best of hyper-scale public clouds alongside rock solid, trusted, highly secure near-local data vaults. Picking your hybrid cloud partnerships will need to be done with care.”

And so we come to the third essential digital enabler – equipping an agile workforce.

Over half the UK workforce now work remotely, either from home or on the road.

And it’s not just the way those workforces are operating: it’s the people doing that work that’s changed too.

There are now five generations in the workplace – from baby boomers to millennials – each demanding a different way of working on the go.

Fail to supply them with the right flexibility and tools, and they will simply look elsewhere.

Marke says: “The challenge here is to make working in teams as easy in business as it is using WhatsApp at home – while catering for the fact that work is a more serious business than play. It’s about squeezing a few more minutes out of the day, getting a quote out faster than your competition, allowing a dispersed team to work together effectively to get a product out to market faster.

“All those little things are difficult to write a business case for, but they make a real difference. Given its importance, I remain genuinely surprised that so few business treat this issue strategically.

“At Daisy, we believe that these are the absolute cornerstones of digital. If businesses get them right it will allow them to innovate and deliver.”

So plenty to think about and plan for.

Over a coffee, perhaps…

INDUSTRY VIEW

To find out more, contact us at www.daisygroup.com