The Rise of Digital Labor

1. Chetan Dube, CEO IPsoft
Beyond Automation –
The Rise of Digital Labor
ISG Saugatuck Summit 2016

2. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
Why Do We Care? Things look OK.
BusinessasUsual?
Revenues (USD) ROE
Origination/Sales Activities 1.75T 22%
Balance Sheet Provision 2.1T 6%
Will Ostrich Algorithm
Work?
• Profits from all banks: record high of 1T last year
• Average return on equity: stable at 9.5%

3. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
Next Big Wave in IT?
 Digital Insurance Trend
WORLD 2.0
 Transition Between S-curves

4. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
Digital: Threat Or Opportunity
Gravity of Threat
(McKinsey)
Magnitude of Opportunity
Digital laggards: 35% net profit
erosion
Digital winners: 40% net profit
upside
WhichSideDoYouWishToBe?
Each One of You Will Be Affected
“If the rate of change on the outside
exceeds the rate of change on the
inside…the end is near”
Business Rules Are Being
Redefined
• Gartner: By 2017, companies
leveraging autonomics and
cognitive platforms will drive a
60% reduction in cost of
services.
• Risk of non-adoption versus risk
of early adoption.

5. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
Digital Offerings
Connected with Digital
Ecosystem
Digital Maturity Curve
Digital Darwinism
Where Do You Wish to Be?
Informed
Catalyst
Leader
Fast Follower
+ Automation
+ Adaptability
+ Analytic
+ Cognitive
Minimal
Very High
5
Majority of Companies Today
Refocus the
Business
Reduce
Operations Costs
RETURNS AXIS
Deliver a Differentiated
End-to-End Digital Customer
Experience With Fractional
Costs
CHANGE AXIS
Digitized Selected Segments
of Business Processes
• Prioritize which segment: most value
• Address people dynamics
• Build 2-speed IT operating model
• Digitize processes
• Connect to ecosystem
STRATEGY

6. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
How Do I Go Digital: Where’s the Value?
Digital, Digital, Everywhere,
Not a drop to Drink
• Prof Hofstadter, UIUC:
“I don’t want to be involved
in passing off some fancy
program’s behavior for
intelligence when I know that
it has nothing to do with
intelligence.”

7. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
SpeedofChange
CognitiveversusManual
Semantic Memory
Affective Memory
Process Memory
Episodic Memory
+
Human Equivalent
or Superior Experience
=
+
+
Need for Digital Labor- Can machines really think?

8. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
What Will Happen to Me?

9. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
CostOptimizationORBetterService?
GeniusofAND,
NotTyrannyofOR
Customer Experience?

10. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
• Drivers People
• Drivers People
• Servers/Apps/Net Business consumer
• Servers/Apps/Net Business consumer
Cognitive IT
What about IT? Disintermediate IT?
UberizationofIT

11. Copyright © 2016 IPsoft Incorporated All rights reserved. IPsoft Proprietary Data.
What Impact Will I Achieve?
DeterministicGains
Cognitive
Autonomic

12. Machines are no longer coming
They are here!