Digital Disruption NZ 2016 conference - Becoming an ambidextrous organisation b
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Similaire à Digital Disruption NZ 2016 conference - Becoming an ambidextrous organisation b
Similaire à Digital Disruption NZ 2016 conference - Becoming an ambidextrous organisation b (20)
Digital Disruption NZ 2016 conference - Becoming an ambidextrous organisation b
- 1. It’s Ours. Insights from Kiwibank’s digital business journey Digital Disruption Summit, August 17 2016, Auckland • Digital disruption moving into new industries • Why this is happening – the five forces driving an internet step-change • What this means for organisations • How Kiwibank is responding peter.fletcher-dobson@kiwibank.co.nz @peterfd
- 2. Our story
- 3. “Kiwis making Kiwis better off”
- 5. Some of the digitally disrupted Home Entertainment Book Retailing Accommodation Classified Advertising Taxis
- 6. Financial services is next
- 8. Company lifespans being reduced Reduced from 61 years in 1951, to estimated 13 years in 2025
- 9. Exponential organisations Snapchat and Occulus Rift hit billion dollar cap in 2 years versus 20 years for typical Fortune 500 companies
- 10. Perils of being on the wrong track from here… …to hereHow do organisations move Traditional organisations can’t keep up with competitors using business, and operating, models on exponential trajectory
- 12. IoT AI APIs BlockchainComputing power Continuous exponential growth APIs and IoT creating true Big Data and driving AI Internet evolves from information to value & asset transfer Five transformational forces NOW FUTURE
- 13. 1. Computing power growth
- 14. 2. APIs enabling platform businesses Companies like Facebook, Twitter and Xero used APIs to turn killer apps from products into platforms Graph by ProgrammableWeb
- 15. Generating value without inventory
- 16. Mondo Bank
- 17. Taking openness to new levels
- 19. 4. Internet of Things
- 20. 5. Blockchain – disrupting trust
- 21. How value transfer works now
- 22. How it works with Blockchain B
- 23. Arcade City – disrupting Uber
- 24. Slock.it: Bridging physical and virtual
- 26. What if…? • FX was as instantaneous and free as a “cross-border email” • 70% of small landowners globally are protected from unscrupulous dictators • Half a trillion dollars in remittance fees instead of going in transaction fees went to people who needed the money • Musicians were automatically and directly paid as soon as their music was downloaded • The provenance of any produce or product was instantly and immutably trackable
- 27. How does an organisation cope?
- 28. Act like a genius “The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.” F Scott Fitzgerald
- 29. Being an ambidextrous organisation Horizon model from The Alchemy of Growth, Baghai, Coley and White, 2000 29 1 “Optimise the business” 2 “Evolve new capabilities” 3 “Invent future business” Growth Horizon 1 Known Horizon 2 Partially known Horizon 3 Unknown Time to impact
- 30. Known vs unknown 30 Certainty Uncertainty Growth Time to impact Horizon 1 Known Horizon 2 Partially known Horizon 3 Unknown
- 31. It never feels like a perfect time…
- 32. …to jump into the unknown “Do not wait until the conditions are perfect to begin. Beginning makes the conditions perfect.” Alan Cohen
- 33. So what are we doing?
- 34. Going back to start-up roots
- 35. Going back to start-up roots
- 37. Evolving joining a bank Pic of selfie prototype
- 38. Bots and data
- 39. Future focus
- 40. Take outs 1. World is changing at an exponential rate – more change in next 30 years than in past 100 2. We believe New Zealand is ideally placed to leverage these global changes 3. Not about a digital strategy – but a strategy for a digital world 4. Being ambidextrous the new normal for organisations 5. Use constraints to maximum advantage 6. You can’t plan your way to or wait for the perfect place
Notes de l'éditeur
- Millennial company by age Two years older than Facebook, four years younger than Google Grown from 0 customers to 900,000 since 2002 Now in teenage years as a maturing business
- Purpose evolved from breaking a cartel of Australian banks to become strategically important bank for NZ Control of NZ capital in NZ Delivered through Kiwis making kiwis better off and delivering independence. To our customers and NZ
- There have been a bunch of industries and businesses disrupted by digital
- Financial Services is the next 90-100 FinTech start ups circling, in this case, Wells Fargo. From payments, to insight to lending and more
- Global Fintech investments in 2015 grew by 75% to US$22.3 billion In Asia-Pacific, US$4.3 billion China US$1.97 billion India US$1.65 billion.
- Why? Technology advances – particularly in the financial industry. Digital currencies; artificial intelligence; quantum computing are driving innovation at speeds rivalling Moore’s Law. Barriers to entry– plug and play models are lowering barriers to entry in number of industries being reduced constantly by the availability of robust but inexpensive global platforms and services. In comparison traditional supply chains for many industries, particularly finance, are often slow and unwieldy What is means: If you’re around for only a decade then you have a choice of either fast and furious or evergreen
- Fortune 500 company takes 20 year Google 8 years Facebook 5 year Uber 3 years Occulus rift 2 years
- Gordon Moore in 1965. Computer technology growing by powers of 10 – progressing more each hour than it did in entire first 90 years Computer speed (per unit cost) doubled every three years between 1910 and 1950, doubled every two years between 1950 and 1966, and is now doubling every year. 1910 minutes per operation – now its billions of calculations per second
- Aggregating information data via APIs to disrupt industries by turning products into platforms – without having to own any assets or even employees (Uber)
- Mondo got banking licence in August 2016 Digital only start up Built tech stack and business in 18 months based on APIs In any other bank a link saying API on public site would go to a press release…
- In Mondo it goes into the API Customers can log in and create new products and services Like a bank giving the keys to IT department to customers – which of course is impossible Truly disruptive; on different trajectory and absolutely confronting to encumbents
- IBM Watson Ingested 600,000 pieces of medical evidence 2m pages of medical journals Search 1.5m patient records Would take a human 160 hours reading a week – week is only 168 hours long Watson successful diagnosis for lung cancer is 90%, human doctors 50% Saved life of Japanese leukaemia patient this year Job examples Lawyers – Ross Psychologist – Ellie HR – Flatpi Webdesigner
- 34 billion devices connected to the internet by 2020, up from 10 billion in 2015. IoT devices will account for 24 billion, while traditional computing devices (e.g. smartphones, tablets, smartwatches, etc.) will comprise 10 billion. Nearly $6 trillion will be spent on IoT solutions over the next five years. Tom Coates has a number of sensors scattered around his home to help identify and track all of this information. These include several Belkin WeMo switches to help control the lights, as well as a Twine device to track temperature and moisture.
- Blockchain disrupts trust on the internet Been around 8 years Combined with other forces it will move the internet from place to transfer content and information to transfer of assets and value Major stepchange
- The Blockchain is a new technology first seen with Bitcoin that creates digital trust between people who don’t know each other. Previously a trusted middle party – bank, lawyer, auditor, stock exchange Previously a database, central record or ledger. Expensive, slow, potential for mistakes or corruption
- Decentralised network Transaction given to the network to validate Some members of the network validate the transaction using maths – solving cryptographic puzzle in effect Transaction appended to a block, sealed and added to chain of blocks All members get copy of the Blockchain To alter you would need to alter each member’s copy Immutable; instantaneous; P2P, transparent
- Decentralized ridesharing service — what some are now calling the ‘Uber killer’. It cuts out the corporate middlemen — and make government regulations obsolete — by transparently providing rider and driver with clear information about the other party to each transaction, including a strong reputation and ratings system where riders and drivers ‘level up’ after community-vetted good behavior on the platform.
- With Slock.it, the unused bicycle in the shed gets a new lease on life. Parking spots can be sublet on demand. Airbnb apartments become fully automated. Slock.it bridges the blockchain and the physical world by making smart contracts enforceable: It's the future infrastructure of the Sharing Economy.
- ASX looking at Blockchain to replace existing clearing and settlement system. Sydney SX looking at same. Instantaneous clearing, no need to hold billions of dollars overnight to clear.
- Five forces are overwhelming. And it’s clear that many of us have been struggling to keep up.
- Take a leaf out of this book. Beauty of being a strategy adviser is that while you can’t rewire your own brain, you can persuade your organisation to do just that
- As Kiwibank has grown we have more regulatory and operational overheads. Can’t ask same people to run and also transform their business We have new constraints with technology change - Core Banking replacement being one How do we Optimise, evolve and reinvent at the same time If you look at the model with wrong mindset it looks like a linear progression to reinvention. But it’s not. You have to do all three at once. And if you attempt to rewire your business you’ll probably find like me that’s a real issue for a lot of people in your organisation
- This is a way of dealing with the unknown The more certain you are of the outcome the more you can predict a result – the less certain the less predictable It’s about having a culture; mindset and operating model that can be fast, iterative across the spectrum but tailored for different outcomes
- Because this exponential change is so new, many leaders still have the mindset of putting in place a plan (normally three years) to gradually build your way to a place where you have everything ready to transform. Yeah? But it’s like my first (and last!) bungy jump last year where, at this point, I actually asked the guy (with his thumb in my back) is now the right time?
- So you can’t plan it or wait for it. Particularly now of all times in business. You have to be bold, gutsy and just do it. And it’s scary. For Kiwibank even more so as we are also replacing our core banking engine, which will take time and a lot of it resource. We’re in a constrained environment. But that’s forcing us to look at different ways of achieving our digital aims.
- Creating operating model and culture that can deliver to Horizon 2 and 3 outcomes Changing operating model Using Spotify-inspired squad, guild, chapter model Agile processes, working out loud
- Designing from the outside in Fast, iterative Blurring the line between IT and Business
- Embracing fintech. Banqer came from start up weekend. Been connected with them from then – but really just trying to get out of their way. We wanted a financial literacy offering for school children and they had the better idea. We’re open to doing a lot more with fintech.
- We are also partnering with Government to help reinvent how you can join a bank digitally. So a bit like Mondo, but with video selfie and biometric technology to create a digital ID process that will enable customers to join and be up and transacting purely through their smartphone.
- We’ve had a squad working on reinventing how Everyday banking may work in the future. In a platform driven world you may actually do your banking with a bot on Facebook.
- And we’re looking even further out to change the conversation around Kiwisaver. It was just a dollar number in your internet banking – with GMI’s Kiwiwealth we’ve done a first in New Zealand by incorporating robo advice into Kiwisaver to show customers what that dollar figure really means for their retirement And how they can change it at the click of a button.
- New Zealanders love tech and are world leaders in mastering technology and often creating unique use cases. It’s no accident we lead the world in electronic payments, our smartphone penetration is in the top 10%. We split the atom for goodness sake. The table stakes are accepting that this change is already happening and at a pace that is rendering old business models obsolete. Constraints can be a blessing – makes you think differently. For us it’s more about how we partner more effectively and don’t go internal. Go where the customers are. Also accept there is never a perfect time. You will never be ready. Just jump.