Pearson Partners International

Tag: internet of things

Disruptive Business Models: Innovative Ideas Transforming Industries
[button url=”/newsletter/searchlight-newsletter-q1-2019/” scrollid=”” icon=”none” type=”inverse”]Go Back to Searchlight Q1 2019[/button]

L to R: Rob Palacios, Patricia Connolly, Joseph Jasser, Keith Pearson, John Terrell, Renee Arrington

In a technology-enabled, globally interconnected world that often feels like it is set on hyperdrive, business leaders must always think a few years ahead to anticipate and prepare for whatever is coming next. Proactively capitalizing on disruptive ideas—at exactly the right time—has become the key to beating the competition and earning the hearts and minds of customers.

To explore the topic of disruption, we invited four forward-thinking business leaders to discuss how their companies and clients are disrupting their industries and their competition at our first-quarter Spotlight Series^SM breakfast on March 5, 2019. Our esteemed panelists included:
- Patricia Connolly, Ph.D., Chief Executive Officer and Founding Partner, SMC²
- Joseph Jasser, M.D., Chief Medical Officer and Executive Vice President of Complex Care Management, Signify Health
- John Terrell, M.B.A., Vice President of Commercial Development, Dallas/Fort Worth International Airport
- Rob Palacios, Managing Partner, inTelliDi Solutions
A disruptive influence can be anything from a consumer trend to a new idea, approach, service or product. Disruptors shake up industries by fundamentally changing the traditional ways that things are done, and they often have a ripple effect that extends outward and affects related processes and industries. Our panelists shared a few disruptive innovations that will soon have a widespread impact on industries as diverse as financial services, transportation, healthcare and outsourcing.

Flying cars. Within the next two years, DFW Airport will become one of the first in the country to introduce a fleet of flying cars, which are expected to become operational between 2023 and 2025. On one of the first such routes in the entire world, travelers will be able to fly from DFW Airport to Frisco in just 15 minutes. The battery-powered vehicles, maneuvered by multiple drones, will travel through geofenced corridors in the air at an elevation roughly one-third the height of airplanes. They will carry passengers to and from virtual takeoff and landing stations, similar to an airport.

Digital twinning. DFW Airport has a $37.1 billion economic impact on the region, more than half of which comes from cargo operations. As part of all airports contributing to a great database of technology, the airport is working on a project called Project Athena, supported by a $15 million U.S. government grant, which brings together innovators, technology professionals and “big data” gatherers to create a digital twin of the airport and its systems. This model will be used to analyze how airplanes move on the airfield, how people move from airplanes to their homes and businesses, how cargo is unloaded and moved onto trucks and when and how the cargo is delivered to its destination. Using this data, the airport will enable just-in-time pickup that eliminates waiting, and eventually, an autonomous operation that moves people and goods across the region and the United States more efficiently.

Blockchain. Because blockchain enables storage of data in a very secure manner, it will have widespread impact on multiple industries. Eventually, blockchain will enable consumers to create a secure digital identity that can be used for any number of transactions, from opening a bank account to securing a mortgage. At the same time, blockchain is enabling international financial transactions to occur much more quickly and affordably—in minutes rather than days. This gives even small businesses the ability to perform international transactions, giving them a competitive advantage. In the next several years, expect the multiple blockchain providers to begin to consolidate to service larger demand.

Healthcare. The healthcare industry is widely considered to be a late adopter when it comes to technology. But consumer expectations and demands in an Amazon-driven world are driving change. Healthcare businesses are seeking new ways to communicate with and engage patients and are making changes to meet patients where they want to be. A growing trend toward in-home care delivery is supported by virtual office visit technology and growing availability of in-home medical tests, including microdevices that take diagnostics to the patient. But the biggest disruption in healthcare will be predictive medicine, in which healthcare providers use data from AI and machine learning to provide proactive care that anticipates what a patient will need in the future. Within the next few years, patients will carry a lifetime of healthcare data with them to any appointment, speeding up the care process while giving providers a rich wealth of data that can be used at the point of care to improve outcomes. In the new value-driven healthcare model, insurance companies will become marginalized as risk transfers to provider groups and health systems.

Virtual teams. The last 20 years have seen the development of immense opportunities for technology workers. Many organizations that provide the services of tech workers are not based inside the United States. U.S.-based companies are shifting away from using these service providers and are instead building their own high-tech teams. This shift from outsourcing to insourcing is done by attracting top talent globally, yet allowing them to work remotely. Technology allows virtual teams to work together seamlessly, and can even help remote workers become part of company culture.

These are just a few of the disruptors expected to change the way businesses operate and people work and live. As with these types of changes that weren’t even on the horizon a generation ago, we can certainly expect more in the near future. Indeed, the only thing that is constant is change. Companies that accurately anticipate and capitalize on disruption will outplace their competition.

Pearson Partners Spotlight Series^SM Breakfast

Save the date for our next Spotlight Series^SM breakfast scheduled for June 4. Did you miss one of our Spotlight Series^SM events? Check out summaries of past events.
April 10, 2019
A Forward Look to 2018
L to R: Renee Arrington, Charles Thompson, Stephanie Anderson, Donald Hicks, Keith Pearson, Bernard Weinstein

[button url=”/newsletter/searchlight-newsletter-q4-2017/” scrollid=”” icon=”none” type=”inverse”]Go Back to Searchlight Q4 2017[/button]

If there were three words that best describe 2017, they would be: disruption, rollercoaster and change. This year’s biggest headlines featured high-profile mergers and moves, positive stock market trends, proposed tax reform legislation, big impacts from social media, unprecedented cyber security threats, fires and storms, and America’s worst mass shootings to date. After a year like that, what can we expect in 2018?
At our Spotlight Series^SM breakfast on December 5, our panel of future-thinkers explored how today’s trends might—or might not—shift and change as we head into the new year. Our esteemed panel members included:
- Stephanie Anderson, Managing Director, AlixPartners
- Donald Hicks, Professor of Political Economy, University of Texas at Dallas
- Charles Thompson, Principal, Ernst & Young
- Bernard Weinstein, Associate Director, Maguire Energy Institute and Adjunct Professor of Business Economics, Cox School of Business, Southern Methodist University
Tax Reform

Much of the discussion at this quarter’s Spotlight Series breakfast centered on the impact of the then-pending tax reform legislation. One big question was, “If the tax cuts go through, how will companies spend their newfound cash?”

Composed of an amalgam of political interests, the current tax bill has contradictory aspects. On the demand side are individual rate cuts. On the supply side are corporate rate reductions and cash repatriation. Some provisions, such as rate cuts and incentivized cash repatriation, may have market-accelerating effects. But then, there is the deficit impact, predicted to be an increase of about $1.5 trillion, which is likely to have an impact on foreign exchange.

In this late-cycle economy, the supply side may come out strongest and could push the current economy down the road and give it a longer run. If the market-accelerating forces are more powerful, companies could decide to invest all of the cash to increase productivity and share repurchases to support stock prices.

Industries that need to innovate to survive and grow revenue, such as retail, will likely invest discretionary money in automation to improve interactions with customers and achieve operational efficiencies, controls to better predict and anticipate customer behavior, and tools to help management make better operational and strategic decisions. In industries experiencing consolidation, such as industrial products and automation, expect the newly freed money to be spent on acquisitions. Some companies will also use the cash infusion for share buybacks and dividends.

For lower-level earners, the tax benefit will not be as good as advertised, and will become a net burden over time. At the same time, companies that invest in automation and analytics will reduce the number of available jobs—especially jobs that don’t require a high level of training. Digital transformation creates skilled technology jobs, but doesn’t benefit lower-income workers.

Energy

Another topic of discussion was oil prices. Two years ago, oil was trading at about $26, and today, it’s closing at about $57. The market appears to have rebalanced. Shale producers can turn a profit even when prices are low, leading to record production of oil and gas to the tune of about 9.6 million barrels per day. Global demand is growing, helping to keep prices high. With these factors in mind, our panelists predict oil prices to remain largely stable in 2018.

The United States’ goal is no longer energy independence, but global energy dominance. Globally, America ranks No. 3 in both oil and coal production, and is No. 1 in natural gas, nuclear and renewables. We export 1.5 million barrels of refined product and more than a million barrels of crude oil every day. In 2018 and beyond, America is poised to become more of a global player in both the oil and gas markets.

Digital Transformation

We are in the early stages of a new digital era, which is leading to a profound digital transformation of the economy. This sea change will eradicate jurisdictions, boundaries and borders, and is slowly creating a new economy that will replace the economic structures built up in recent decades.

Social media has connected people through technologies such as Snapchat, Facebook, Twitter and Instagram, but a new sort of network is emerging that connects living networks to autonomous networks. Objects in the physical world are beginning to report data (the Internet of Things, or IoT), and those networks are increasingly conversing with each other and with their human operators. Machine learning and natural language processing, combined with cheap sensors that monitor environments and human activities, are creating an unprecedented amount of usable information. This new digital age will continue to offer enormous opportunities for creating business value.

However, cyber security will continue to be a big issue, and in light of recent hacks such as the Equifax breach, can no longer be considered a discretionary investment.

Stock Market

The Trump administration’s focus on deregulation is likely to have a long-term impact on the business environment. From federal judges to the executive level within government agencies, many appointments have yet to be made, but business people are anticipating a much more business-friendly regulatory environment.

What will happen to the stock market in 2018 is anyone’s guess, but the current market success is largely driven by low interest rates. Our panelists predict modest increases in 2018 as the markets mature, foreign investment in the U.S. grows and tax policy changes.

As 2017 draws to a close, we think back on our three words: disruption, rollercoaster and change. With tax reform on the horizon, a stable oil market and the evolving technology of the Internet of Things, 2018 is primed to be an interesting year. We look forward to next December, when we might summarize the year with its own descriptors.

Pearson Partners Spotlight Series^SM Breakfast

Save the date for our next Spotlight Series^SM breakfast scheduled for March 6. Look for details and invitations in February. Did you miss one of our Spotlight Series^SM events? Check out summaries of past events.
December 20, 2017
Future Focus: Macro Trends and Their Global Impact
From Left: Stephen Konstans, Michael Vidikan, Keith Pearson, Jennifer Sanders, Lane Conner

Macro trends, largely driven by innovation in technology, are rapidly changing the landscape of our professional and personal lives. The way people interact with each other and the world is vastly different today than it was 10 years ago, and will likely be completely different a decade from now. Understanding technology and trends that are now in the pipeline equips businesses to ride the waves of change that will benefit them, and avoid jumping on those that won’t.

At our Spotlight Series^SM breakfast on September 12, our panel of future-thinking executives discussed macro trends that business leaders need to understand today, because they will have a big impact tomorrow and beyond.
- Lane Conner, Founder and Chief Executive Officer, Fuzse
- Jennifer Sanders, Co-founder and Executive Director, Dallas Innovation Alliance
- Michael Vidikan, Founder and Chief Executive Officer, Future in Focus
Technologies and Trends that Shape the Future

By understanding what may be coming in the future, business leaders can better understand how to take their companies where they want them to go. Decisions about what technologies to adopt and what trends to pay attention to now will affect plans and business strategies 10 or 15 years ahead. Our panelists suggested several areas to watch for rapid change.
- Smart cities. Increased densification and population, coupled with aging infrastructure, is pushing cities to find ways to use resources more efficiently. Cities like Dallas are focusing on the intersection between technology, data and community initiatives to increase economic development and use resources more efficiently. The goal: to make cities more livable and improve quality of life. As infrastructure changes over time, businesses must adapt as well.
- Peer-to-peer currency transactions. The way people are transacting with each other is changing, and banks are being cut out of the picture. Technologies such as Square have enabled anyone to accept credit card payments, and PayPal’s Venmo and other “digital wallet” and point-of-sale technologies are shifting the way money changes hands and young people relate to commerce. Soon, retailers could use peer-to-peer processing technology to cut out costly credit card transactions and immediately accept direct payment, which will increase their profitability but force banks to find new income streams.
- Cybersecurity. More secure chip cards are becoming the new norm, but they still can’t thwart online predators. Automated transactions provide an opportunity for extra security. At the same time, the security of infrastructure, such as the electric grid, requires careful oversight as new technologies are added to our world.
- The Internet of Things. The number of “smart” objects that collect and share data will continue to grow, as the cost of the technologies comes down and their benefits increase. Analytics make sense of the incoming data, allowing better decisions at the institutional and corporate level and beyond. These smart sensor technologies can be integrated across industries to create more intelligent interactions between humans and the world.
- Medical and health innovation. Genetic engineering, disease research, regenerative medicine, 3-D organ printing, home medical tests and wearable monitors all have potential to help people live longer, healthier lives.
- As people become increasingly dependent on technology, the risks from hackers and identity thieves increases. People will continue to perform a risk/benefit calculation before adopting new technology–or even posting on social media–and often will decide whether the benefits outweigh the risks. Businesses must perform their own risk/benefit analysis of new technology, and must decide not only if they can do it, but if they should.
- Blockchain. The new evolution of internet infrastructure creates an indelible, decentralized record of every transaction, making it impossible to tamper with ledger data already recorded. This new technology makes it easier to verify and authenticate transactions, helping to prevent fraud.
- Artificial intelligence. Machine learning has high potential to help people improve automation, make better decisions, and effectively use resources. One key to widespread acceptance and use of AI is programming is “morality,” so that machines will always make decisions with human safety in mind.
Business leaders should be planning not just for who their customer is today, but who their customer will be in 5 or 10 years. If the customer will be younger or have different characteristics, the organization must change the way it does business, or it will be left behind by other companies that offer those future customers more of what they want.

It’s also important to be agile and open to change, but to act with intention. Rather than jumping directly into the next “new shiny thing,” businesses must first identify the problems they need to solve and areas they need to improve, then embrace the macro trends that help accomplish those goals.

Pearson Partners Spotlight Series^SM Breakfast

Save the date for our next Spotlight Series^SM breakfast scheduled for December 5. Look for details and invitations in August. Did you miss one of our Spotlight Series events? Check out summaries of past events.
September 30, 2017
The Human Capital Impact of the Aviation Internet of Things

[button url=”/newsletter/searchlight-newsletter-q2-2017/” scrollid=”” icon=”none” type=”inverse”]Go Back to Searchlight Q2 2017[/button]

IIC Partners’ Aviation Aerospace & Defense Practice Group explores the impact that the Internet of Things (IoT) and rise in connectivity will have on talent in the aviation industry.

Featuring Pearson Partners Vice President Frank Morogiello

The Internet of Things (IoT) revolution has set its sights on the aviation industry. The advent of the “eEnabled airline” signals a departure from the traditional procurement practices exhibited by airlines where ‘boxes’ were simply bought and installed on aircraft. Every airline is unique, every supplier different, and IoT offerings are not products—they are solutions. To successfully navigate this frontier and reap the rewards of successful projects, both airlines and suppliers must rethink the composition of talent within the organization.

The Market Potential

The concept of aviation connectivity or “eEnablement” has matured over recent years to extend beyond the airframe. Passenger-focused solutions, such as inflight WiFi, have long dominated the airwaves, but as modern networked aircraft (e.g., A350, 787) start to reflect larger portions of the global fleet, airlines and suppliers must treat aircraft as nodes in the ecosystem of connectivity.

This ecosystem impacts the airline, not just individual aircraft. The rise of connected nodes, decreasing costs of bandwidth, and record profit levels impacting the global aviation sector are giving way to innovative approaches to IoT. Jay Carmel, a Senior Associate at the aviation consultancy Avascent, says “Ongoing improvements in how we generate, transfer, and analyze aviation data—due in large part to better sensors, more affordable networks and more sophisticated software—are creating new airline revenue streams and opportunities for cost savings that will shape the future of airline competition.” Connectivity is no longer a pure consumer-facing cost of doing business—it represents the potential for improved passenger experience, operational efficiencies and meaningful cost savings.

Read the complete white paper on the IIC Partners website.

June 6, 2017
Internet of Things Creates New Opportunities for C-Suite Executives
[button url=”/newsletter/searchlight-newsletter-q1-2015/” scrollid=”” icon=”none” type=”inverse”]Go Back to Searchlight Q1 2015[/button]

By Renee Baker Arrington, Senior Vice President & CIO Practice Leader

In our recent Q1 2015 Spotlight Series breakfast, The Digital Business Dream Team, we discussed how chief information officers and chief marketing officers are increasingly collaborating in digital business. A significant catalyst of this collaboration has been the emergence of the Internet of Things (IoT).

From GPS devices in truck fleets and aircraft black boxes, to wearable medical devices and remote-controlled smart homes, the IoT is creating a technological revolution. More than 10 billion “things” are currently connected to communicate with each other to make our lives and businesses more efficient. However, with this efficiency comes inherent risk. Senior executives need to understand the new opportunities and challenges the IoT represents.

“Companies are at differing stages along their IoT path, but the majority do not have a strategy in place yet,” according to Jeremy Schneider, a partner with McKinsey & Company and keynote speaker at the December 2014 joint technology session of the Society for Information Management Dallas/Fort Worth and Financial Executives International Dallas.

While the majority of media attention around the IoT has been about personal wearables and connected smart homes, in reality, more than 70 percent of the value lies in enterprise and industry applications. Schneider called the IoT a vast industrial ecosystem that includes sensors and other devices with online connections to powerful data-collection and analytic systems. Contrary to budgetary concerns, it is not typically a capital-intensive undertaking.

“Most IoT business cases are driven by cost savings, and capital investment is relatively limited,” Schneider said. “But there is extensive value to be captured by enterprises and their end users.”

The Internet of Things Technology Revolution

By 2020, nearly 50 billion connected endpoints will be used to create almost $15 trillion^[i] in value for a wide range of purposes. Though estimates of the exponential rise in connected devices vary^[ii] the IoT offers myriad opportunities to improve industry, such as:
- Tracking of consumer behavior, such as in-store apps that analyze customer traffic flow and purchasing decisions
- Optimized manufacturing, warehousing, distribution and retail processes to maximize productivity and minimize waste
- Optimized usage of resources, such as energy, inventory and fleet assets
- Enhanced situational awareness, such as warning systems for vehicles
- Enhanced decision-making, such as medical devices that alert doctors to changes in a patient’s condition
- Autonomous systems, such as self-parking and self-driving vehicles
[blockquote]As the IoT technological revolution evolves, it will be interesting to watch the biggest winners emerge, as did the telecoms in the ’80s (AT&T, MCI, Sprint), PC manufacturers in the ’90s (Microsoft, IBM, HP), the web companies in the 2000s (Google, Yahoo, Amazon), and today’s smart phone makers and carriers (Apple, AT&T, Verizon). –Jeremy Schneider, Partner, McKinsey & Company[/blockquote]

Because the IoT can enable new ways to do business and manage risks, CIOs, chief technology officers, chief financial officers, senior risk managers and other C-suite executives need to pay close attention to this dynamic sector. For instance, there may be new ways to deploy sensors and monitors in tandem with mobile devices and applications, or to feed the growing volume of big data into a cloud computing or virtual network infrastructure.

Addressing the Challenges

For organizations to capitalize on the numerous potential benefits of the IoT, they must also address the challenges and risks.

For example, mobile devices with GPS locators and other types of sensors can be used for tracking consumer behavior, including buying habits and patterns. However, an IoT strategy designed to capture and analyze those data must also have safeguards in place that protect individual privacy. Applications might need to strip out any consumer-specific information before uploading the data.

An even higher standard of privacy applies to patients whose wearables or medical sensors upload health-related information to physicians, hospitals, pharmacies and other providers. Under federal law, those IoT “conversations,” including potentially life-saving medical alerts and prescription reminders, must be transmitted under very specific parameters.

Individual privacy is not a concern for sensors embedded into products or packaging for inventory control, nor for devices placed on delivery trucks or other vehicles to track those mobile assets. However, those devices, applications and networks also need to be secured against hackers or thieves who could falsify IoT transmissions to disguise a theft.

Another significant challenge is building a database and network powerful enough to accommodate a substantial upsurge in machine-to-machine data. Fortunately, the advent of virtual networks and cloud computing have lowered the cost of data storage. A bigger issue is the development of effective Big Data business intelligence and analytics tools to capture the significant information that may not be readily apparent in the vast flood of new IoT-generated data.

Finally, organizations striving to harness the power of the IoT will need to invest in their human resources, bringing aboard technology and marketing professionals at every level – including the C-suite – with the imagination and experience to develop effective strategies. Having the right people in place is critical to using this fast-moving technology to advance the company’s vision and business goals.

Exploring the Options

In considering how IoT strategies could deliver new operational and financial benefits to an organization, there are many practical factors to address. Companies that are in the preliminary stages of exploring IoT solutions might form a multidisciplinary task force, which could also include customers and partners, to consider such questions as:
- Where do we lack information about our markets, customers, people, assets or operations?
- Would deploying sensors or other devices help fill those information gaps and enable our company to make better decisions?
- Are there ways to use the IoT to develop new service models for our customers?
- Could we develop a more dynamic pricing model with access to real-time information?
- Would more customer data help us refine our products and services to meet changing needs?
- Can sensors and devices help us lower costs of energy, raw materials and labor?
- Would the IoT help us improve safety in our facilities and reduce risks to our employees and customers?
- Where will a new IoT strategy deliver the largest potential return on investment?
Organizations in virtually every industry need to ask these kinds of questions. With profit potential increasing exponentially, they may find themselves racing to catch up to the competition in this fast-moving technology revolution.

^[i] Cisco Internet Business Solutions Group (IBSG) 2011: The Internet of Things

^[ii] Postscapes’ Internet of Things Market Forecast 2014
April 2, 2015