1) The document discusses how businesses need to shift from prioritizing efficiency to responsiveness in order to adapt to today's fast-paced, changing business environment where customer needs and technologies are constantly evolving. 2) It recommends that businesses move from a fixed capital expenditure model to a variable operating expenditure model using cloud computing in order to gain more flexibility and agility. 3) The cloud allows businesses to explore new opportunities with lower risks by enabling them to quickly setup, scale up or down, and retire applications and services on demand.

1. Business in the Cloud Michael Hugos CENTER FOR SYSTEMS INNOVATION [c4si] COEX, Seoul, Korea

4. Responsiveness Trumps Efficiency VERY FAST on straight road; sharp turns cause car to flip; slow deceleration LESS FAST on straight road; capable of sharp turns; quick deceleration 20 th Century Industrial Economy 21st Century Real Time Economy FAST CAR (Efficient) AGILE CAR (Responsive)

6. Move from Cap Ex to Op Ex Fixed Cost Traditional IT (Cap Ex) Actual IT demand Forecast IT demand Fixed Cost of Capacity B A Variable Cost Cloud IT (Op Ex) A = over capacity B = under capacity In times of high change reduce risk by moving from fixed cost to variable cost

13. Global Business Agility “ Just do it” Lower risk… See what happens! OFFICE OFFICE OFFICE OFFICE OFFICE Expansion used to be expensive and risky – big up front investment Cloud and SaaS

14. Cloud - Social Media - Consumer IT Integrate in-house IT with cloud based technology Data Center

15. Global Business Networks Industry Operating Systems - evolving applications and services for specific industries Cloud Coordination – collaborate using Business Intelligence and Simulation Cloud Backbone – Companies connect and communicate Cloud Systems Company A Market Demand Company B Company C

16. What Does It All Mean? Are we seeing emergence of a global cerebral cortex? Our bodies are of billions of autonomous cells talking to each other… Our planet now has billions of us talking to each other…

17. Learn More This presentation excerpted from my newest book: Meet me at book signing immediately following this presentation Next to Information Desk at Smart & Cloud Conference, 8 Sept. 2011 Read my blog at CIO.com: Doing Business in Real Time Reach me at: www.MichaelHugos.com