Technological advances are disrupting the status quo and creating huge turbulence. Industries are converging, and new competitors emerging, at breakneck speed. The role of the CFO is evolving. CFOs must aid in strategy development to pursue profitable growth by capitalizing technology. How do the leading enterprise drive top-line growth and also bottom-line savings?

1. IBM Global Technology Services
Journey to the Future
Funding Innovation for Growth
Adesh Mathur, CPA, CMA
CFO, Global Technology Services
IBM Greater China Group

2. IBM Global Technology Services
Digital invaders with disruptive business models are reshaping
industries. The pressure to innovate has never been greater,
nor managing the risks more difficult.
The top CFOs are rising to the strategy development with
CxOs, funding innovations with flexible financing models and
they help the board room to accelerate digital transformation for
growth in the age of disruption.
Be an Innovative CFO, a Progressive Thinker.

3. ©2016 IBM Corporation3
For Global C-suite Study we surveyed
business leaders,
Chief Executive Officers (CEOs)
Chief Financial Officers (CFOs)
Chief Human Resources Officers (CHROs)
Chief Information Officers (CIOs)
Chief Marketing Officers (CMOs)
Chief Operating Officers (COOs)
818
643
601
1,805
723
657
©2015 IBM Corporation3
including 643CFOs
from 54 countries

4. ©2016 IBM Corporation4
“The ‘Uber syndrome’ – where a competitor with a
completely different business model enters your
industry and flattens you.”
CIO, Transportation, United States
What’s putting the world’s
top executives on edge?

5. “The most unpredictable external force impacting
our business right now is disruptive innovation:
it totally changes the rules of the game.”
CFO, Consumer Products, China
©2016 IBM Corporation5

6. ©2016 IBM Corporation6 IBM Global Technology Services
Total CEO CFO CHRO CIO CMO COO
70%
60%
50%
40%
30%
20%
10%
0%
Industry convergence
The “anywhere” workplace
Rising cyber risk
The redistribution of
consumer purchasing power
The sustainability imperative
Alternative finance and
financing mechanisms
The sharing economy
Top trends to impact business (in 3 to 5 years)
CFOs, like other CxOs, expect industry convergence
to have the biggest impact on their business
67%
47%48%
29%
22%
46%
24%

7. ©2016 IBM Corporation7
“The boundaries of competition are
becoming ambiguous.”
Yong Eum Ban, CFO, JoongAng Media Network, South Korea

8. ©2016 IBM Corporation8 IBM Global Technology Services
External forces impacting the enterprise (in 3 to 5 years)
For the first time, the entire C-suite selected
technology as the main game changer
Technology
factors
Market
factors
Regulatory
concerns
Macro-
economic
factors
People skills Socio-
economic
factors
Globalization Geopolitical
factors
Environmental
issues
72%
71%
55%
51%
48%
34%
31% 31%
27%

9. ©2016 IBM Corporation9 ©2016 IBM Corporation9
“It’s very hard to evaluate the impact of new
technologies. We worry that we might miss a
disruptive game-changer.”
Dr. Stefan Mäder, CFO, SIX, Switzerland

10. ©2016 IBM Corporation10
Some leading enterprises know they
need to prepare for a future in which
disruption is pervasive. Here are two
instructive examples.
Seize the initiative

11. ©2016 IBM Corporation11 IBM Global Technology Services
Agility for Growth
Can the existing technology adapt
to the constantly changing
business needs?
Technology Investment Strategy
Does the investmentalign with
business growth?
Considerations on achieving
business objectives
Operational Effectiveness
Are technology maintenance/
ongoing operation resources and
costwell managed?
On-premises
Infrastructure
Data Center
for DR
x On-premises
Infrastructure
(Core Applications)
Cloud
An Air Cargo Logistics Operator in Hong Kong
enables Agility with Innovationfor the Future Business
• Ensure Agility and Flexibility for
business growth and faster time to
market
• Shift to a predictablyOPEX modelto
align cash flows better with
business growth
• Maintain the better service level,
reduce TCO by 20% and on site IT
operation resources
Why change?
Technology Transformation
• Replaced the static platformwith a
flexible and agile one
• Eliminated the high operating
expensesand resourcesassociated
with maintaining the data center
• Run a vendor-managedoperational
model
Change to Pay-per-Consumption
Model based on financial analysis
What did they change?

12. ©2016 IBM Corporation12 IBM Global Technology Services
Agility for RapidExpansion
Is the existing IT resources capable to
build and run a new IT infrastructure
for the new dealershipbusinessin 3
months required by the M&A deal?
IT Resources and skills
Are the existing IT resourcesand
skills adequate to manage the
ongoing operations and supportthe
future expansion plan?
Considerations for achieving
business objectives
A Premium Automobile Dealer based in HK meets the Stringent
Requirements of New Dealership for Business Expansion in UK
Ensure Agility for RapidExpansionand
faster time to marketto grasp the new
opportunities
Leverage Managed Optionto source
additionaltechnology resources and
skills required urgentlyto supportthe
additional500 users in 12 office
locations in 2 UK cities from Hong Kong
headquarter
Why change?
Mindset Change
Open to new delivery modeland adoptcloud
as the most suitable one to complete the
transition in 3 months, instead of the traditional
way which takes more than 6 months
New Sourcing Options
Evaluated the value of in-house vs managed
options in consideration of resourcesand
financial constraints on expansion plan
What did they change?
IT Resources
based in HK HQ supporting
WW IT operations
New Business in UK
500 users, 12 offices, 2 cities

13. ©2016 IBM Corporation13
Yet, do you still believe…..
Technology is a capital investment with
no measureable impact on revenue
Reality: Technology can accelerate
the digital transformation and
support innovation to grow revenue
CIO is the provider of infrastructure
Reality: CIO emerged as a strategic partner
for development of business strategy and
plans, and the provider of technology
services to address the business challenges
Public cloud is the only cloud and
its biggest benefit is cost reduction
Reality: Enterprises also use
private clouds within their
organizations. More are
deploying hybrid IT model
across public and private
clouds, and legacy systems.
1
2
3

14. ©2016 IBM Corporation14
Take the long view
Focus on the strategic implications of industry
convergence and digital transformation, scan the
entire scene, look for new opportunities to expand
1
What to do

15. ©2016 IBM Corporation15 IBM Global Technology Services
8%
More digital, virtual interaction +19%
201320%
81%
68%
2015
More face-to-face interaction
21%
More focus on customers
as individuals
+22%
2013
no change
33%
66%
54%
2015
More focus on customers
as segments
CxOs increasingly leverage new technologies to
focus on customers as individuals
Business landscape change (in 3 to 5 years)
no change
The Way to Engage with Customers

16. ©2016 IBM Corporation16
Evaluate and Plan
Look into the value and impact of the emerging
technologies, search for partners to help you to
become more innovative
2
What to do

17. ©2016 IBM Corporation17 IBM Global Technology Services
10%
12%
Technologies revolutionizing business (in 3 to 5 years)
The technologies that CFOs expect to revolutionize
business tomorrow are already in play today
Cloud computing and services
Mobile solutions
Internet of Things (IoT)
Cognitive computing
Advanced manufacturing technologies
New energy sources and solutions
Bioengineering
Man-machine hybrids
63%
61%
57%
37%
28%
23%
60%
52%
52%
36%
14%
11%
38%
26%
All CxOs CFOs

18. ©2016 IBM Corporation18 IBM Global Technology Services
24%
CxOs see a need to collaborate more, with more
external parties, for innovation
More external innovation +15%
2013
no change
38%
54%
47%
2015
More internal innovation
“One of my priorities is making alliances with companies that have greater
technological know-how than we do.”
Rodrigo Castillo, CFO, Comercializadora Mayorista del Golfo, Mexico
Business landscape change (in 3 to 5 years)
Source of Innovation

19. ©2016 IBM Corporation19
Find out the one suit you best
Analyze the financial implications on investment, determine the
most appropriate operational and financing models, make sure
to align your financial planning with strategic and operational
planning
3
What to do

20. ©2016 IBM Corporation20 IBM Global Technology Services
Source of new skills and capabilities
86%
77%
77%
41%
20%
Working with contractors,consulting
firms or specialist agencies/outsourcers
Partnering with other enterprises to tap
their expertize
Hiring in new employees with the skills
you require
Investing in automated systems or services
(e.g. robotics)
Soliciting help from customers and rewarding
them for their assistance
The vast majority of CIOs aims to acquire new
skills and capabilities by forming new partnerships
and hiring new employees

21. ©2016 IBM Corporation21
Innovative CFO: a Progressive Thinker
Find out the one suit you best3
Evaluate and Plan2
Take the long view1

22. IBM Global Technology Services