[Accenture] Digital Business 2017

Digital Business
External Material

Becoming a Digital Business is not just digitized marketing or digitized
operations – it will be essential for survival
What is a Digital Business
Copyright © 2013 Accenture All rights reserved. 2
Definitions:
Digital Business: an
organization that incorporates
digital technology to create
revenue and results via
innovative strategies,
products, processes and
experiences.
Digitize: applying technology
to resources. A digitally
enabled sales force is an
example of incremental
digital improvement.
Digitalize: the process for
turning digitized resources
into new sources of revenue,
growth and operational
results that generate a
premium to your business.Internal Focus
External
Focus
Digitize Processes
Revenue
Profit Margin
Digitize
Channels
Digitize Marketing
Digitalize
Operations
Digital
Business
Digital
Transformation

The Digital Age requires a rethink about traditional strategy formulation in
discovering opportunities for our clients
Evolution of technology and business
Copyright © 2013 Accenture All rights reserved.
B T B
In the past, Business requirements
drove Technology that then
enabled the Business to advance…
B
T
Today, technology creates new
opportunities and fundamentally
changes businesses…
Opportunities Imperatives
…with the objective of digitalizing
processes and making products
available through digital channels.
…and transforms the business and
operating models of almost every
company in every industry.
3
B T= Business = Technology

Key technology trends combined with enabling technologies presents
dramatic opportunities for new players and real threats in all industries
Key trends and technologies
The possibility to virtualize and consume infrastructure, platforms and
applications as a service enables new levels of scalability, flexibility and
responsiveness.
Social media and collaboration technologies enable new ways and drive
expectations of interacting, personalization and building relationships within
and beyond the organization
Technologies such as in-memory computing and appropriate information
architectures which enable real-time decision making based on analytics
Analytical methods and access to the right data enable the generation of new
insights and decision-rich information. Big Data approaches allow to make
use of the rapidly increasing amount of data from multiple sources
Connected devices of all kinds and cheap sensors integrated nearly
everywhere constantly create large amounts of data that need to be managed
effectively. This also enables new ways of automated and personal interaction
The uninterrupted trend towards using mobile devices impacts all areas of
business and personal live by transforming how people interact, consume
information and services, collaborate, and work
Cloud
Social media/
Collaboration
Analytics/
Big Data
Data Velocity
“Connected
Everything”
Mobile

Digital Business results in new challenges and new roles for Corporate
Leaders as well as the speed of decision making required
Changing role of Corporate Leaders (CEO, COO, CIO)
COO
CIO
› How do I use digital to align the organization for increased speed to market
and more flexibility?
› How can I deploy digital solutions to improve business process efficiency?
› Does digital change the level of vertical and horizontal integration?
› Where does IT help create new business models & opportunities?
› Does the IT organization have the capabilities to facilitate innovation and
enable the business strategy?
› Where do I need to invest in order to be ahead of the technology curve?
CEO
› What should I do about digital disruptions in my industry?
› How does digital help me grow the business, enter new markets or
strengthen the position?
› How does it threaten my value chain ecosystem of customers, suppliers,
business partners?
Examples of big disruptions
that requires actions from
Corporate Leaders:
Questions for Corporate Leaders
Competitor can reduce
their operating costs by
10 – 15% through
digitalized operations
New competitors are
emerging from
previously unrelated
industries.
The skills required by
leaders and
organizations to
compete are different
5

Changing role of Corporate Leaders (CFO, CDO, CMO)
CDO*
CMO
› Which roles and responsibilities does a CDO have in the new era?
› How does digital strategy integrates with business & IT strategies?
› How digital opportunities can be used to innovate the business model and
increase market share?
› Does our marketing strategy exploit the opportunities of new technologies to
improve our digital consumer value proposition?
› Do I have sufficient insights about how customers use digital technologies?
› How does digital facilitate customer retention?
CFO
› How can digital help me to improve financial performance?
› Where is the profitability of our products/services threaten by digital e.g. new
market entrants with much lower costs structures?
› How can I better control the business with real-time information?
Examples of big disruptions
that requires actions from
Corporate Leaders:
Questions for Corporate Leaders
Competitor can reduce
their operating costs by
10 – 15% through
digitalized operations
New competitors are
emerging from
previously unrelated
industries.
The skills required by
leaders and
organizations to
compete are different
CDO = Chief Digital Officer 6
Digital Business results in new challenges and new roles for Corporate
Leaders as well as the speed of decision making required

7
Value tree of a digital business
Metrics Improved
Value of
Digital
Business
Growth
through
Digitalization
(Revenue levers)
Efficiency
through
Digitization
(Cost optimization)
ObjectivesValue levers Investments in new Digital Capabilities
New
customers
• Analytics-driven and dynamic customer segmentation
• Improved digital customer experiences linked to segments
• Faster time to market with targeted offerings
New &
optimized
products &
services
• Monetize information assets
• Create new digital products, services and offerings
• Rapid prototyping with customer interaction
• Integrate products and services into solutions that have digital components
• Convergence of products enabled by digital technologies
New &
optimized
channels
• Omni-channel marketing, selling and servicing provide seamless integration
across channels
• Customize digital channels to customer segments and experience to
optimize the cost-to-serve levels
New pricing
and earnings
models
• New earnings (subscription, licensing, credit, “freemium”, etc.) models
• Rapid prototyping of earnings models on sample customers
• Combine portfolio of digital and non-digital products and services with
customized earnings models and pricing
New cost
models
• Analytics-based commercialization (marketing, commissions, trade
promotions) to target investments and track returns
• Customer self service
• XaaS opportunities to digitize the technology and infrastructure assets
Supporting technologies: Analytics, Mobility, Cloud, Virtual networks, Social, Sensors
• Customer acquisition/churn
• Sales conversion
• Customer profitability
• Cross-sell and Up-sell
• Decrease time to market
• Revenue per customer
• Product development costs
• Portfolio management costs
• Cross-sell and Up-sell
• Customer satisfaction
• Customer profitability
• Cross-sell and up-sell
• Decrease % of time spent on
non-selling activities
• % handle by self service
Process
efficiency
• Digitized and automated process processes
• Improved process governance & efficiency through real time insights
Asset
utilization
• Optimized production/inventory planning based on demand forecasting
• Data-based preventive asset maintenance
• Task automation optimization through digital technology such as sensors
Agility
• Utilize remote access and collaboration and mobility tools for employees
• Integration with partners in digital ecosystem to optimize service delivery
• Virtual organizations enabled by mobility and seamless cooperation
• Customer satisfaction
• Process efficiency
• Production costs
• Inventory costs
• Employee productivity
• Customer support costs
• Training costs

Challenges Digital Value Levers
• Underutilized assets (down time, demand)
• Competitors offer significantly lower price
• Exclusive IP has limited market value
• Licensing is not part of our business model
• Customers abandoning non-digital channels
• Sales and serve costs consuming margins
• Current customers are not future customers
• Customers valuing experience over product
• Today’s data is not tomorrows insight
• What matters, when we know everything?
• Current products face limited future potential
• New product migration paths are uncertain
• Customers gaining control of our brand
• Technology performance equals brand promise
• Limited availability of business services
• Weakest link limits ability to change and scale
• Our rate of innovation falling behind the market
• Collaboration trapped between silos
• Lead times for internal mobilization increasing
• Upgrading skills without downgrading focus
Example Target KPI’s and Metrics
• Customer interest, participation,
satisfaction, retention and referrals
• Purchase frequency and size
• New product revenue contribution
• Sales & channel productivity
• Product portfolio yield
• Customer satisfaction – net promoter
• Brand awareness and reach
• License revenue growth
• Share of IP-based products
• Increasing variable to fixed expense
ratio
• Greater ROA
• Greater margin contribution from new
products and improved operations.
• Reduced time to results & profitability
• Retention of ‘best people’ and skills
• Reduced restatements and
• Increase in fact based decisions
• Reduced activity cost and cycle time.
• Rising EBITA per employee
• Lower unit infrastructure and
operations costs
Leaders should recognize specific challenges which can be addressed
through digital value levers
Customers and their
experiences
Product and Service
features and functions
Sales and service
channels
Brand equity and
perception
Trading partner
relationships & alliances
Intellectual Property and
Licensing
Operational scale.
Facilities and locations
Information and
understanding
Organizational agility and
workforce engagement
Innovation and
collaboration
RevenueOperations
Brand,IPand
Intangibles

Digital technologies impacts industries in different ways and presents
unique as well as shared opportunities across industries
Digital examples by industry
Industries 1. Digital Revenue
Growth
2. Cost-efficiency through
digitization
3. Digital Business
Resources • Chemical company provides
online portal for partners to
manage orders for a fee
• Energy companies apply analytical
methods to improve asset
maintenance resulting in reduced
number of unplanned downtimes
• Chemicals extend their portfolio
with solutions combining
classical products with value
adding services (e.g. BASF)
Communications,
Media and
Technology
• Telco partners with retailers
(for a fee) to push offers to
shoppers who opt-in
• Media companies digitize their
operational value chain resulting in
time improvement and reduced
costs (e.g. Warner Bros.)
• Telcos extend their business
model by integration mobile
payment solutions (e.g. African
mobile payment trend)
Financial Services • Retail banks offer additional
services like mobile payment or
advanced wealth mgmt. for
normal customers
• Retail banks optimize their process
and leverage customer self service
opportunities (e.g. BBVA artificial
intelligence supported self service)
• Crowd-funding based loan
options, allowing retail banks to
reduce their risk exposure (e.g.
kickstarter)
Products (divide
into Automotive,
Pharma, IE, Retail
& CGS)
• Office supply company sells its
products through its
ecommerce platform
• Inventory optimization due to
analytical driven demand forecast
and supplier integration in value
chain (e.g. WalMart)
• Individually customized
products instead of mass
production (e.g. cereals
customization via webportal)
Health, Life
Sciences and
Public Service
• Pharmaceutical company uses
analytics to customize products
• Public services reduces process
costs by digitization of
administration processes and
customer self service options
• Life sciences extends business
into lifestyle nutrition supplies
based on individual analytical
results
9

10
Accenture’s Digital Business Strategy Offering addresses the issues,
decisions, actions and investments required in creating a digital
business
Digital Business Strategy Framework & Critical Questions
Vision, Opportunities and Outcomes
Digital Operations & Platforms
Digital Products,
Services and Offerings
Customer
Experiences
and
Workforce
Abilities
Digital
Ecosystem
and
Business
Process
Operating
Model
and
Future of Work
Information and Applications
• What are digital’s disruptive opportunities,
threats and outcomes?
• How will enabling technologies and
trends support differentiation and
sustainable growth?
• What are the changes digital creates in
go-to-market and business economics?
• What combinations of strategic
information, interactions and ability drive
compelling customer experiences?
• Who has the required capabilities
internally and externally?
• What is the most effective structure to
drive creativity, collaboration and
adaptability?
• What is the most valuable information
and where will it come from?
• What are the requirements for a digital
platform delivering efficient speed and
scale?
Innovation and IP
BusinessModel
OperatingModel

Accenture is a Digital Business partner that can set the right path and
accompany an organization in every step of the journey
Accenture’s Value proposition
Your Digital Business Journey
Plug-in
capabilities
Set the
direction
Your
Organization
Accenture
You need a digital
business partner
that can set the
right strategy for
your organization,
based on an
understanding of
your industry and
the available
technologies.
A partner that you
can leverage key
capabilities from
that seamlessly
integrate into your
business to launch
your Digital
Business faster and
more effectively.
A partner that is
connected to and
can connect you
with all the different
parts of your
ecosystem.
A partner that has
the breadth of
expertise,
footprint and
people to bring
your digital
business to scale,
no matter what your
ambition.
Ecosystem
Scale

12
Accenture’s assets and experiences supports every part of the journey
and accelerates delivery while reducing risk
• Accenture provides actionable
recommendations
• Accenture is a trusted partner with senior
leadership from strategy design to detailed
execution- transformation
Set the direction
Grounded in expertise across
40+ industries,
163,000 industry SME’s
across 54 countries
• Dedicated practices that provide
comprehensive offerings
• History of successful partnerships in the
marketplace with clients
Plug-in
capabilities
In Cloud, Analytics, Big Data,
Mobility, Social and Interactive
Marketing
• Global presence in nearly all industries and
markets to meet the region-specific strategy
and operating requirements of 4,000+ clients
• As one of the largest system integrators and
technology consulting firms globally,
Accenture has relationships across almost
every industry’s ecosystem that can be
leveraged for optimized strategy, execution
and ongoing operations
Ecosystem Relationships across almost every
industry’s ecosystem
270,000 consultants located
across 200+ cities
Scale
Accenture’s capabilitiesHow Accenture can help

13
Accenture is unique in covering the business & technology components of a
integrated digital strategy from strategy to execution, incorporating agility in
simulations, prototyping and delivery of business outcomes
How Accenture’ approach is different
Business
Model
Technology
Model
Operating
Model
PrototypeOutcome
Vision
Capability
Direction
Opportunity
Simulation
Proof of
Concept
Pilot
Solution
Minimum
Viable
Solution

14
Proctor & Gamble uses real-time decision-making to drive business
success supported by real time analytics
Case Study: P&G – Real Time
What P&G Did
• Identified 88 business process covering $79bn of the
company’s operations
• Realized that a time gap between information origination
and application to business decision hinders decision
making
• Applied analytical models to compress the time needed
for decision making
• Scaled analytical decision making by giving over 50,000
employees access to their customized “Decision
Cockpit”
• Focused on how to best apply and visualize information
instead of discussion if the information is true
Outcome
Reduction of $900m in cost over 8 years

15
BASF grew a traditional business through digital value-adding solutions
Case Study: BASF – Growth by digitalization
What BASF did
• Identified the need of customers to better
understand the application options of agro
chemicals
• Developed an mobile online tool which was
enabled the digital disease identification of
plants in the field
• A direct connection between the most applicable
BASF products and the disease is then
established to treat the affected plants
Outcome
Increased sales and market share in South
America

Thought Leadership (1/2)
Thought Leadership
Topic: Cloud computing
Where the Cloud Meets Reality: Scaling
to Succeed in New Business Models
16
Topic: Multichannel marketing
Seamless Multichannel
Retailing—Customize. Connect.
Converge. Collaborate
Topic: New role of CMOs
From Marketing
Communications to Experience
Engineering: The New Role for
CMOs in the Digital Era
Topic: Social Networks
Influence at Scale: How Companies Can
Harness the Power of Social Networks
Topic: Digital Consumer
Winning and Retaining the Digital
Consumer

Thought Leadership (2/2)
Thought Leadership
17
Topic: Mobility
The New Age of Mobility
Topic: From Analog to Digital
How to transform the business model
Topic: Analytics, Marketing
A new path to growth: How to
stay a step ahead of changing
consumer behavior
Topic: Mobility, workforce
Embracing the consumer IT revolution
– at work
Topic: Ecosystem strategy
Cross-industry ecosystem:
growth outside the box

The time for companies to become Digital Businesses is now - what is
your strategy?
Digital Business Strategy
18
Digitalize Processes
Digitize
Channels
Digital
Transformation
The industry disruptions are happening.
New growth opportunities are available.
Your competitors are adapting.
What is your Digital Business strategy?

[Accenture] Digital Business 2017

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[Accenture] Digital Business 2017