Estonia is a small country with no natural resources and a desire to keep taxes low, so it needed to find a way for government to be more efficient, explained Siim Sikkut, the digital advisor to the Prime Minister of Estonia is his international keynote speech at this year’s CIO Summit in Auckland last week. Sikkut had the audience marvelling at what a country of just 1.3 million people can do with technology when it sets its mind to it.

Fifteen years ago the Estonian government started to experiment with digital technology to make life in Estonia better and more efficient. Today all Estonians have a digital ID embedded in their smartphone SIM cards, they have digital signatures for everything including parliamentary bills, you can start up a legally functioning company in 20 minutes, 96 percent of people pay their taxes online in under three minutes, health records are electronic and prescriptions digital, and one third of voting is done online. It’s digital transformation on steroids.

For Vernon Turner, IDC’s world-wide guru on enterprise systems and the Internet of Things (IoT), digital transformation and the IoT go hand in hand. “To have digital transformation you have to have data,” he said, speaking to iStart ahead of his closing keynote speech at this year’s CIO Summit. The difficulty comes in how to take that information from different places and analyse it in a meaningful manner. This is where he thinks the next market share battle ground will be – in platforms that can aggregate, analyse and prioritise data. For now data is still confined to “stovepipes” of information that cannot be easily shared, but he said we are starting to see a middle layer coming into play to help federate, analyse and otherwise use the data meaningfully.

“To have digital transformation you have to have data,”

The Estonian Government has this use of data down pat. All of its digital services are underpinned by X-Road, the national data exchange platform, which is a layer of technology that connects the whole of Government and parts of the private sector together. And all this only costs one percent of the government budget because X-Road APIs can be used and re-used to quickly and efficiently create new services. The Government even launches new services in beta so that it can continue production in response to feedback from citizen users. This speeds up the time to market but requires a large amount of trust in the people handling your data.

It’s all about “efficient and effective government”, Sikkut said in his address. The underlying ethos is the ‘once only’ rule – if the Government already knows something about you, it should not have to ask you twice. To some that might sound like Utopia, but to others it might sound scary. Sikkut assured that there are strict rules around who can access your data and for what reason, with the whole system being consent-based. “The people own the data – always. I can see who has been accessing my data – and if they have no reason to I can complain,” says Sikkut, adding that a couple of doctors have already been punished for accessing patient notes they had no business with.

“The people own the data – always. I can see who has been accessing my data – and if they have no reason to I can complain.”

Another part of the Government’s efficiency is reflected in how it works with the private sector rather than employing developers directly. Sikkut said (almost jokingly) that it’s like a government business growth initiative because the Government is getting what it needs for its citizens while also helping the private sector to grow. It’s something that other governments and muncipalities could do to emulate, according to Turner, who offered another example of how the city of Paolo Alto’s CIO has created an open data platform that has made all the movements of vehicles, traffic light signals, road incidents and the like freely available to those who want to use it. As a result, every global car manufacturer has a lab in the city to experiment with driverless cars. By making it a natural private-public venture it both benefits society and drives the economy, he said.

Perhaps most astounding of all, is the Estonian Government’s launch of what is essentially country-as-a-service. Anyone, no matter where they are in the world, can become an e-resident of Estonia which means that they can set up a secure digital identity similar to the digital identity linked to Estonian citizens’ ID card or ID SIM card. While it does not confer citizenship or residency it does allow holders to use the services provided by Estonian state agencies and the private sector which are usually connected to the ID card. The aim is to create a borderless digital society with 10 million e-residents by 2025.

Asked if the Estonian Government has been able to make better decisions thanks to all the data at its fingertips, Sikkut admitted “not as much as I would like – but we are starting to play around with data and do some modelling with taxes and predict how certain industries will go”.

There’s always opportunity for improvement when you’ve got technology on your side.

The recent departure of Mark Weldon from his position of CEO at MediaWorks (NZ) is a prime, and very public, example of an organisation wholly rejecting its leader. He came in to introduce a new way of doing things but he couldn’t win the support of the people in the company that really mattered. In the time he was there the organisation saw a slew of high-profile departures including former TV3 news boss Mark Jennings and two of the nation’s most popular broadcasters John Campbell and Hilary Barry.

Dave Winsborough, founder of leadership development firm Winsborough and VP of innovation at New York’s Hogan International, is an expert on leadership at the top of organisations. He was forthright in his opinion on the Mark Weldon case: “From afar I have watched Weldon ultimately be repelled by the culture of the organisation. He came in to do a job but I think he just ended up pissing so many people off, and being such a non-media person, that the body of the staff at TV3 rejected him. I think if he had better insight in to his [ahem…behaviours], he could have helped to deliver a change to TV3.”

Winsborough said that leaders in particular tend to have an inflated sense of self-worth and of their abilities – Weldon being a case in point. He said it is important for leaders to take the time to not only find out about themselves but also the organisation that they are working for and then “be conscious” of their actions. “Don’t just assume that because you’ve been successful in the past that you have a God-given right to be successful in the future,” he warned.

This is where psychometric testing comes in to play. It can not only help organisations choose new leaders (or staff in general) but also aid in personal development and assembling effective teams.

Ludy Colenbrander, managing director of HR Profiling Solutions ANZ which administers the FinxS online psychometric self-assessment (based on the ‘DISC’ parameters of Dominance, Influence, Steadiness, Conscientiousness), explained that people have a ‘natural working style’ and an ‘adjusted working style’ but at the end of the day, a person will perform far better in a role that matches their natural working style because, well, it comes naturally to them.

He tells the story of a sales principle at a car dealership who was at his wit’s end because he had a high staff turn-over and a consistently underperforming team despite plenty of training. The DISC behavioural analysis test (which takes eight minutes and requires subjects to choose which attributes they are most and least like) showed that the entire team, including the sales principle himself, were SI style people, which in DISC-language means that they were systems people who liked to dot the ‘i’s and cross the ‘t’s. None of them had a natural inclination towards sales.

According to Colenbrander, the sales principle had made the common mistake of hiring people like him when the best sales people have D and I styles. With all the will in the world, the SI types were never going to be top salespeople. The dealership has since refreshed the team with people more naturally suited to the salesperson role and has increased sales, stabilised staff turnover and significantly reduced training costs.

The sales principle had made the common mistake of hiring people like him.

Hiring for aptitude is becoming more important than hiring for knowledge in certain industries. For example, Winsborough says he is seeing more and more computer programming firms hire for aptitude because programming languages change so fast. In this case it is more useful to have staff who are adaptable and quick learners than people with an encyclopaedic knowledge of C#.

Winsborough is not a big fan of individualised assessments which he calls “interesting but kind of useless”. What you really want to know, he says, is how people interact in a team. Five years ago he created and launched a software product that analyses whether a team will be successful with its current personnel makeup. Via personality questionnaires it looks at whether the team has got what it needs to be successful at its job and then gives it a way of thinking about what that means for the future. While hiring for ‘fit’ sounds smart, Winsborough contests that managers need to consider that hiring for what you need now is not in the best interest of the mid-term organisation. Sometimes hiring outside their comfort zone is what managers need to do to be pushed and challenged, and ultimately achieve better results. Winsborough has been working on profiling entire organisational cultures, and when an organisation needs to go through a big change then the last thing you want your managers to do is to hire in their own image.

Winsborough is not a big fan of individualised assessments which he calls “interesting but kind of useless”. What you really want to know, he says, is how people interact in a team.

Winsborough is also challenging the status quo, experimenting with a number of new behavioural analysis tools for judging personality and aptitude. Not everyone wants to answer a personality questionnaire, and some feel like you can game the system no matter how clever it is. Winsborough says that now it is possible to extrapolate personality style from a subject’s social media feed or emails. He is also running an experiment with an Israeli company using voice. It allows participants to respond to the questionnaire verbally.

“We can extract your personality surprisingly well from voice,” he said, explaining that it’s not what you say but how you say it that is full of give-aways. Winsborough has also started a number of experiments to see whether it can be done using video footage by developing algorithms that can extract personality from facial expressions.

It might sound a bit creepy, but the aim is to introduce choice into the testing equation so as to get a truer picture of a participant’s personality. Added to that, employers are already checking out employee’s online presence, “but it is being done in a really unscientific and unstructured way that is open to bias and interpretation” says Winsborough.

“What we are going to do is help employees get a fair deal by making sure that information is rigorous and there is a framework around it.”

At the end of the day, the most successful people know who they are and how to get the best from their team. If psychometric tools can help the mere mortals among us to be better at what we do or find a job we love, then their use just makes good sense.

In 2003 Apple launched the iTunes Music Store and the world shifted. It wasn’t a seismic shift, more of a surreptitious changing of the points at a railway junction, and it set society and business on a new course. We were now on the path to disruption; businesses models, delivery channels and pricing structures would change in response to the online marketplace. While the music industry was the most immediately and directly affected, it would not be long before other radical thinkers would turn more industries on their heads.

Cloud CRM provider Salesforce was one such firm, spinning enterprise CRM in a new direction and into the cloud. In 2005 it launched its AppExchange – an online application marketplace for third-party applications that run on its Force.com platform, which, more than ten years later boasts 2,500-plus third party applications and close to three million installs. Today it is one of the yardsticks by which software enterprises measure their marketplace success. The thing is, now there’s many, many marketplaces. Some of them are just aggregators which provide feature and price comparisons, but the true marketplaces offer full provisioning, subscription billing and ongoing maintenance through their platforms. The marketplace for marketplaces is hot.

According to a 2015 Fortune 500 AppDirect report, almost every company in the Fortune 100 offers apps or cloud services of some kind, with 20 percent offering third-party services as well. Three quarters of those offering third-party software also operate their own marketplace.

“The centralised experience of the marketplace makes it easy for customers to find, buy and use software. This is one big reason why 76 percent of Fortune 100 companies that offer third-party software also operate a marketplace,” said the report.

Kiwi cloud based retail software company Vend has had great success both in selling through marketplaces and building its own marketplace ecosystem. Vaughan Rowsell, founder and director of Vend, told iStart that a marketplace is a great place for apps to be discovered, as long as it is active. Metrics for measuring marketplace activity include number of visits, number of downloads and the size of the marketplace. Although, Rowsell comments that you shouldn’t discount a marketplace for being small – it might just be niche or that you have fewer competitors. However, app vendors shouldn’t expect magic even from an active marketplace. For real success, you have to invest time in encouraging your passionate customers to post reviews and testimonials because that “holds a lot of weight”.

“The centralised experience of the marketplace makes it easy for customers to find, buy and use software. This is one big reason why 76 percent of Fortune 100 companies that offer third-party software also operate a marketplace.”

In the end though, all a centralised marketplace can do is fill your sales funnel – you still have to talk to customers and go through the sales process, Rowsell warns.

There is clearly a growing hunger for centralised marketplace experiences at the user end. Grant Thomson, vice-president for enterprise for Salesforce in A/NZ, says that while his company pioneered the marketplace for the enterprise and is probably more successful than most, he has seen more change in the application marketplace landscape in the last few years than in the last 20.

“I think the world is changing and the customers themselves are trying to change the procurement process,” he says. Thomson was careful to stress that you cannot do away with control around probity and security, but application marketplaces do make it very easy to try the ‘suck it and see’ method of choosing an application. It certainly speeds up the decision process in one way as you can try it out for a couple of weeks, and if it doesn’t work, it’s no biggie, just move on to the next.

The problem is that most of these marketplaces belong to a software vendor who has a vested interest in keeping its own offering at the centre of your solution design. All the apps in its marketplace should integrate with it seamlessly, and the better ones will integrate with each other. But what if you find the perfect app from a competitor’s ecosystem? A lion cannot survive in the desert, no matter how powerful his roar. It’s effectively ecosystem lock-in. That’s why Thomson says the next hurdle is to get different marketplaces integrating. He thinks that will happen but it will take time.

In the interim cloud-broker businesses are starting to pop up to great effect. Take 9spokes, for example. It is a value-added broker of cloud services which picks the best applications to support what it views as the nine processes needed to run any business and serves them up as a package deal, with custom-built integration to other apps built if required. In an interview with iStart, founder and chairman Adrian Grant said 9Spokes solves the problem of which apps to choose and how to manage and make the most of them. It offers users an interface that streamlines administration, makes choices easier, provides access to meaningful operational data, and helps make sense of businesses in comparison to peers. Its app catalogue runs to 52 solutions including all the usual suspects such as Xero, Vend, MYOB, Dropbox etc, but Grant said that they are very selective of which apps make the grade.

It’s this new type of marketplace which we suspect will rise in popularity as enterprises seek to retain control over their choices. 9Spokes is not the only company that is offering this sort of service, as Grant pointed out in the interview, but “the fact that other companies are looking at how to address the same issue validates what we are doing,” he said. (Read the full interview here.)

PwC is just one of the companies offering something similar to its customers. Its PwC Next solution, which it launched for its clients in March, is a purpose-built cloud platform that brings together more than 60 cloud solutions on one customisable dashboard that is accessible anytime, anywhere with a single log-in. Clients can mix and match what tools they need to run their business without having to deal with multiple platforms.

Cloud-broker businesses are starting to pop up to great effect.

It would seem that everyone is attempting to clamber on the bandwagon this year. In February, SAP made generally available its Hybris-as-a-Service (known as YaaS, which stands for Hybris business platform as a Service… we guess HBPaaS wasn’t as catchy) a marketplace for what it calls micro-services, centred on its Hybris e-commerce engine. It allows any registered business or developer to quickly add new business capabilities to existing applications by subscribing to SAP’s APIs. And apparently there is no vendor lock-in. Hybris CEO Carsten Thomas calls it more of a “framework” than a platform. Technology commentator Ben Kepes attended February’s Hybris SAP Summit in Munich. According to him, writing in the US edition of Computerworld, the company “is suggesting that ‘first-generation’ cloud marketplaces, in particular Salesforce’s Force.com, are limiting in that they assert too much control over the ISVs in terms of languages and approaches to building products”. Kepes mused whether this was really the case, especially when it comes to Salesforce. It’s hardly a surprising position to take. The ‘master vendors’, SAP Hybris included are, after all, not creating these environments for the good of the ‘open source’ global business community, they want their solutions to be the centre of the universe.

As we can see from PwC’s foray into a sort of marketplace-cum-dashboard thingumajig, it’s not just software companies that have marketplace-type offerings. Today, other industries are trying to differentiate themselves through the ecosystem model as well, in particular telcos. Telstra has run its T-Suite app marketplace since 2008, which currently has 44 apps on offer, followed by a half-hearted attempt from Spark (apps.sparkdigital.co.nz with a rather feeble-looking four apps).  Word is, however, that both are about to be reinvigorated as service delivery and on-boarding processes improve on the marketplace platform they both use. Rumour has it that both telcos will plough millions of dollars into initiatives to provide OTT services for business.

“For anybody who has bulk relationships with small business, firing up a marketplace makes sense.”

“It’s an interesting move from the telcos to start to provide non-core business, moving away from line rentals to selling software subscriptions to small business,” said Rowsell, who added he will not be surprised if the banks are next.

“For anybody who has bulk relationships with small business, firing up a marketplace makes sense because they have the customer base,” he says. And, if they have frontline sales staff who are having conversations with customers, that is good news for technology companies in those marketplaces.

“There is a massive move from people towards cities; and cities will increasingly have to compete with each other for people, businesses and investments. There is no doubt that the truly smart cities will be the winners in this development.” That’s according to Paul Budde, writing recently for iStart on the value of smart cities – cities where the daily lives of residents, commuters and tourists are enhanced by clever technology that makes life easy, fun and more efficient.

Smart cities of course rely on smart technology.

Various Internet of Things (IoT) studies estimate billions and trillions worth of value from billions of sensors, but it is in smart city initiatives that those numbers start to become a reality, delivering value and sustainable outcomes to the populace.

The Australian Standing Committee on Infrastructure, Transport and Cities released a report in March which recognised the transformative potential of smart ICT in the design and planning of future infrastructure. “These technologies are transformational with the capacity to dramatically increase the productivity of the Australian economy,” said committee chair, John Alexander MP.

In the section called ‘visions of the future’ the report identified new technologies and processes like Building Information Modelling (BIM), the IoT, geospatial technology, machine learning and mobile laser scanning as instrumental to the success of our cities of the future (mobile laser scanning being those whizzy vans that not only photograph but micro-measure in 3D detail the cityscape as they drive around).

Dr Dean Economou, who was an acting business team director at NICTA at the time the report was produced, told the report’s authors that infrastructure needs in Australia’s cities will certainly grow: “By 2050, Sydney and Melbourne, and Perth too, are forecast to have double the population. However, roads and other kinds of infrastructure cannot possibly double. So we have to use smart ICT to inform where and how to increase the utilisation of our assets and also to inform new investment so we make the best possible use of scarce money.”

Dr Michael Dixon, of IBM, told the authors about his company’s Smarter Cities vision, saying: “In simple terms, Smarter Cities is about applying the currency of the 21st century data to all manner of challenges historically faced by cities in order to make traditionally dumb things smart and enable everything, from machine to machine communication through to the most sophisticated predictive modelling.”

NICTA was already using a wide range of data to produce more robust demographic modelling in areas such as predicting maintenance, crime and higher risks of road accidents, prior to its closure. Examples of technology being used to make cities smarter are emerging the world over. Barcelona has smart LED streetlights which only turn on when there are people present; Madrid has sensor-equipped rubbish bins which tell city contractors when rubbish needs to be picked up; San Francisco uses RFID chips and a mobile phone app to signal where there is an available parking space; Los Angeles is taking steps to change its understanding of where its energy is flowing; and Edmunton in Canada is using the power of the public to report and capture the state of playground equipment and picnic facilities in its parkland.

In many cases it is about how you capture the wisdom of the crowd, says Patrick McVeigh GM of business, innovation and skills at ATEED, Auckland Council in New Zealand. “What’s at the heart of a smart city is how you use technology to improve the experience of the city for residents, tourists and visitors.” He used the example of a recent collaboration with Spark and its business intelligence spin-off Qrious, where ATEED collected anonymised mobile phone data at a V8 motor racing event to better understand where people had travelled from how they interact with the event, what time they arrived and left, and something which they refer to as “dwell time”. This information will be used to improve planning and facilities at the next event.

Like Budde, McVeigh said that Auckland Council has to look at the subject of smart cities from a globally competitive angle. While there are lots of broad initiatives being taken thanks to the IoT, it’s a good idea to specialise in one sector and become a hot hub he said. In Auckland, that hub is focused on technology innovation – everything from ICT, to FinTech to AgriTech – based at the GridAKL innovation precinct in Wynyard Quarter. The innovation precinct itself is based on smart city principles and its building management systems are fitted with sensors that capture user behaviour and project them onto a data wall to allow better building monitoring and management and encourage more sustainable behaviour.

The number of sensors required for this type of monitoring is enormous. Analyst firm Gartner’s latest estimates suggest that there will be that 1.6 billion connected things used by smart cities in 2016, with 518 million of those being in smart commercial buildings. That’s up, they reckon, by 39 percent from 2015.

“Smart commercial buildings will be the highest user of Internet of Things (IoT) until 2017, after which smart homes will take the lead with just over 1 billion connected things in 2018,” said  Bettina Tratz-Ryan, research vice president at Gartner. A recent McKinsey Report sees things a little differently calculating that factories were likely to receive the greatest benefit from the IoT, with a potential financial impact of US$3.7 trillion per year to 2025, followed by cities, at US$1.7 trillion per year.

Indeed, the Strategic Forum for the Australasian Building and Construction Industry, a body that brings together key stakeholders in the Australasian building and construction industry, has stated that Australia and New Zealand, when taken together, “rank the third highest adopters of BIM in the world”, and that Australia and New Zealand both “demonstrate global leadership in the frequency with which they leverage BIM to visualise design intent”.

The Australian Standing Committee on Infrastructure, Transport and Cities has recommended that BIM be made mandatory for all projects exceeding A$50 million. It has also called for the formation of a Smart Infrastructure Task Force, based on the UK’s BIM Task Group which represents and co-ordinates government, academia and industry implementation of smart ICT in a city’s infrastructure.

The analyst predictions might be seen as pie in the sky, and the bureaucrats glacially slow to effect change, but it’s clear that clever innovations will get a willing ear, and budgets follow the excitement. The real competition, however, will be from the innovation ecosystem to build partnerships between application developers, industrial automation and sensor vendors so as to be able to access data, make sense of it and expose it to every day city-dwellers. And that will take foresight, and big budgets – budgets that will be helped by the our-city-is-smarter-than-yours competitive instinct.

The latest release of Deloitte’s annual ‘Tech Trends’ report provides an almanac of insights, advice, case studies and opinion on matters affecting business IT. Inside the 135 pages of the 2016 report are sections covering, for example, augmented reality, the internet of things and industrialised analytics. While you’d expect these hot tech topics to be covered, the coal-face challenge for many businesses is modernising legacy systems. In this year’s report Deloitte has dedicated a section to uncovering innovative ways to reinvigorate the foundational IT systems in your business, as summarised below:

IT’s legacy is intertwined with the core systems that often bear the same name. In a way, the modern IT department’s raison d’être can be traced to the origins of what is now dubbed “legacy” – those heart-of-the-business, foundation-of-the-mission systems that run back-, mid-, and front-office processes. Some include large-scale custom solutions whose reach and complexity have sprawled over the decades. Others have undergone ERP transformation programs designed to customise and extend their capabilities to meet specific business needs. Unfortunately, the net result of such efforts is often a tangle of complexity and dependency that is daunting to try to comprehend, much less unwind.

Meanwhile, core upkeep and legacy modernisation lay claim to inordinate amounts of IT budget. Deloitte’s 2015 global CIO survey found that core-related expenditures are the single biggest line item in IT investment dollars. This leads to an internal PR problem for the core: High cost is seen as low value. When asked to rank the technology investments they think will have significant impacts on their business, survey respondents cited analytics, digital, and cloud.

Clearly, it’s easy to overlook the fact that these and other emerging technologies are highly dependent on the underlying data and processes the core enables.

Approach re-imagining the core with a transformational lens – it is, after all, a chance to modernise much more than the underlying technology. Challenge the business to imagine how functions and processes should and could operate based on today’s realities, not yesterday’s constraints. Core modernisation can provide a path toward much more than re-engineering; it may ultimately help the business reinvent itself.

The five Rs
Roadmaps for reimagining the core should reflect business imperatives and technical realities, balancing business priorities, opportunities, and implementation complexity. They will likely involve one or more of the following categories of activities:

• Replatform: Upgrade platforms
• Revitalise: Layer on new capabilities to enhance stable underlying core processes and data.
• Remediate: Address internal complexities of existing core implementations.
• Replace: Introduce new solutions for parts of the core.
• Retrench: Do nothing – which can be strategic as long as it is an intentional choice.

Where do you start?
Core modernisation is already on many IT leaders’ radar. In a recent Forrester survey of software decision makers, 74 percent listed updating/modernising key legacy applications as critical or high priority. The challenge many of these leaders face will be to move from an acknowledged need to an actionable plan with a supporting business case and roadmap. Reimagining the core could involve gearing up for a sustained campaign of massive scope and possible risk, potentially one that business leaders might not be able to understand or willing to fully support. Yet, the fact is that CIOs no longer have a choice. In the same way that the core drives the business, it also drives the IT agenda. Consider this: What if that same legacy footprint could become the foundation for innovation and growth and help fuel broader transformation efforts? The following considerations may help bring this vision more clearly into focus:

• It’s a business decision: There should be a clear business case for modernising core systems. Historically, business case analysis has tended to focus primarily on cost avoidance, thus rendering many proposed initiatives uneconomical. It’s hard to justify rewriting a poorly understood, complex core legacy application based only on the prospect of avoiding costs. However, when companies frame the business case in terms of lost business opportunities and lack of agility, the real costs of technical debt become more apparent. Even then, however, it is important to be realistic when projecting the extent of hidden complexity, and how much work and budget will be required to meet the challenges that surround this complexity.
• Tools for the trade: Until recently, the process of moving off ERP customisations and rewriting millions of lines of custom logic has been resource-intensive and issue-prone to the point of being costprohibitive. Why migrate that old COBOL application when it’s cheaper to train a few folks to maintain it? Increasingly, however, new technologies are making core modernisation much more affordable. For example, conversion technologies can achieve close to 100 percent automated conversion of old mainframe programs to Java and modern scripting languages. New tools are being developed to automate the scanning and analysis of ERP customisations, which allows engineers and others to focus their efforts on value-added tasks such as reinventing business processes and user interactions.
• Shoes for the cobbler’s children: Leading CIOs caution against approaching core modernisation as a project with a beginning and an end. Instead, consider anchoring efforts in a broader programmatic agenda. Keep in mind that core modernisation efforts shouldn’t be limited to data and applications – they should also revisit underlying infrastructure. As IT workloads migrate to higher levels of abstraction, the infrastructure will require deep analysis. Shifting simultaneously to software-defined environments and autonomic platforms can amplify application and data efforts. Similarly, higher-level IT organisation, delivery, and interaction models will need to evolve along with the refreshed core. Consider undertaking parts of the rightspeed IT model in conjunction with core modernisation efforts.
• Honor thy legacy: Reimagining the core has everything to do with legacy. That legacy is entangled in a history of investment decisions, long hours, and careers across the organisation. A portion of your workforce’s job history (not to mention job security) is embedded in the existing footprint. As such, decisions concerning the core can be fraught with emotional and political baggage. As you reimagine core systems, respect your company’s technology heritage without becoming beholden to it. Sidestep subjective debates by focusing on fact-based, data-driven discussions about pressing business needs.

This article is an excerpt of the 2016 Tech Trends report by Deloitte. The re-imagining core systems section was written by Deloitte systems integration director Scott Buchholz and technology principals Ben Jones and Pavel Krumkachev. The report also includes chapters on:

• Right-speed IT
• Augmented and virtual reality go to work
• Internet of Things: From sensing to doing
• Reimagining core systems
• Autonomic platforms
• Blockchain: Democratized trust
• Industrialized analytics
• Social impact of exponential technologies

Download the full Deloitte 2016 Tech Trends report.

…

Kiwi entrepreneur Peter Beck wants to open space up to the masses by knocking tens of millions of dollars off the price tag of deploying satellites into space. He is on the cusp of creating a billion-dollar aerospace industry right here in the Antipodes.

Invercargill-born Peter Beck has always been fascinated by rockets and their potential. Ever since he was a child he dreamed of working for an aeronautical giant such as Lockheed Martin or Boeing and making space more accessible to everybody. Everything he did in his career was another manoeuver in the journey there. Forgoing a degree. He started as a tool and die maker in the precision engineering trade. “That gave me the tools to be able to build the rockets that I wanted to build,” he says. After that he worked for the government at what is now Callaghan Innovation (then IRL), but a trip to the States in 2007 turned the trajectory of his journey away from the large corporates and into start-up territory.

“My wife had some business to do in the States, so I took a month off work and spent it visiting all the companies I had wanted to see for many years,” he says. What soon became clear, however, was that although there were plenty of space programmes at these companies, you had to be a US citizen and get clearance to work on them because of the nature of the technology.

“It was just obvious that there were huge barriers there and even if you did break them down you were still just a government contractor – you’re not actually making a big difference. It became very apparent that they weren’t doing what I wanted to do. For me it has always about reducing the cost and increasing the frequency of trips to space to allow some awesome and significant things to happen. So it was really that trip that sealed the deal. I remember coming back on the plane thinking: ‘well, if they are not going to do it, I am’.”

Lift off
Beck set up RocketLab with the goal of commercialising space via the Electron Program. The company has two guiding principles: launch costs must be kept below $5 million and launches must take place once a week. To achieve this Beck says RocketLabs approaches all problems with no predetermined constraints.

Beck believes that if his company can make weekly low-cost flights possible, he will be able to build a critical mass of infrastructure in orbit and do “some really spectacular things”. And there are plenty of companies around the world that believe RocketLab is on track to be able to do just that. In 2009 RocketLab became the first company in the Southern Hemisphere ever to send something into space. Today it has over 30 commitments from clients, which range from MOUs to signed launch contracts, for satellite launches – something Beck calls “absurd” given that RocketLab hasn’t even launched its first commercial vehicle yet. (It has launched over 80 rockets since 2008, will start its test flight programme at the end of this year and once it does put its first satellite into orbit it will be the ninth nation in the history of our planet to ever do so – all the others being Super Powers.)

“It gives you an indication of how much pent-up demand there is in the industry and how RocketLab’s credibility is viewed internationally,” he says.

RocketLab’s interested clients – Beck won’t name any of them yet – come from a wide range of industries across the government, commercial and academic sectors. At this stage the commercial interest is generally linked to earth observation for doing things like mapping and monitoring movements of ships in ports. Beck expects, however, that once the Electron Program reaches critical mass it will have the potential to inject significant competition and increased accuracy into many industries, and to transform life not only for the developed world but for the developing world as well. The average citizen often doesn’t realise how much they already rely on space infrastructure in their everyday lives, he says. We jump in our cars and use GPS, we listen to the radio, watch television, surf the internet and receive weather forecasts – all without thinking that somewhere far up above us a network of satellites is working hard to make it all happen.

“It gives you an indication of how much pent-up demand there is in the industry and how RocketLab’s credibility is viewed internationally.”

“Space infrastructure is critical to daily life and if you can reduce the cost to getting that infrastructure built then a lot more can happen. If we are launching a satellite once a week then life will be very different. For starters internet will be everywhere, so it won’t matter where you are on the planet, you’ll have internet. For you and I that’s just handy, but when you think about third-world countries it is really quite empowering to be able to disseminate the knowledge of the planet in to somebody’s hands in a mud hut. I think if we can get that satellite infrastructure up there, that’s a huge win for mankind.”

Indeed, Google recently announced plans to put thousands of satellites into space for internet use – something the team at RocketLab could (and would very much like to) help facilitate.

Flying down under
RocketLab’s operations all take place in New Zealand, but not because Beck is a Kiwi. Beck is single-minded in his goals. RocketLab is a global company with its parent company being the US entity because it makes it easier to raise venture capital that way – to date all of its funding has come out of America’s Silicon Valley, from the likes of aerospace giant Lockheed Martin, Khosla Venture and Bessemer Venture Partners.

“You just can’t do those sorts of raises in a New Zealand company,” Beck says. “These are the guys that look for the really big disruptive opportunities – they don’t invest in incremental changes.” (RocketLab has also secured funding from K1W1 Ltd an investment company owned by fellow business legend Sir Stephen Tindall).

When it comes to the research, development, testing, manufacturing and launching, however, this is all done by RocketLab in New Zealand because, as Beck puts it, New Zealand is a fantastic place from which to put rockets into orbit.

“We are a small island nation in the middle of the Pacific, there’s nothing out there until Chile which is a very long way away,” says Beck, explaining that the massive expanse of clear air and marine space and lack of landmasses means it is perfect for launching rockets at high frequency.

“Like I said, it’s all about solving the problem with no predetermined constraints.”

Trailblazer
RocketLab is not only building rockets in New Zealand, it is also having to build the infrastructure for a whole industry, including a launch site and tracking stations, all the while keeping to its key goal of cheap and frequent space flights. It has deliberately chosen to build a small launch vehicle, not a big one, so that automatically reduces cost, and it has also embraced new technologies to tamp the costs down even further. The design and manufacture of the rocket engine has been a two and a half year process in itself, while on board there is the equivalent of a mini super computer which has over 32 processors.

“There’s a good reason why only nine countries have ever managed to do it – it’s freaking hard.”

“We use additive manufacturing (or 3D printing) in metal an awful lot – our entire rocket engine is actually printed. We use all carbon composite structures. The launch vehicle has been built around reducing cost and increasing reliability and manufacturability,” says Beck. “Those sort of technologies and innovations aren’t just cool, they really make the job a lot easier.”

‘Easier’ is a deceptive word, however, as Beck says that every time RocketLab builds another launch vehicle it reconfirms just “how freaking hard” it is to do.

“There’s a good reason why only nine countries have ever managed to do it – it’s freaking hard. You are controlling enormous amounts of energies and … if you are out by a fraction of a percent on anything then you don’t get your satellite to orbit. The margins for error are zero.”

If any company can do it, however, it seems likely that RocketLab can.

Vital statistics
• 20 m tall
• 1 m in diameter
• Weighs a just over 10.5 tonnes
• Runs on liquid oxygen and a refined kind of jet fuel
• Lifts 100 kg payload
• Reaches a 500 km sun-synchronous orbit
• Operates under a Federal Aeronautics Administration (FAA) licence
• Adheres to the strict laws governing space flight

It used to be said that you had 30 seconds from when a customer stepped in to your store or office to when they made a decision to buy or use your service. But at least they were entering your domain where every aspect of the experience could be controlled and calibrated to make them more likely to spend with you. Today the decision is made in a matter of seconds and between clicks. The vast majority of customers have already made up their mind whether to purchase from you long before they set foot on your premises, and many of them won’t even make the trip, preferring to interact online. Then there is the question of competition from abroad thanks to e-commerce and cloud services. The perfect customer experience has become at once paramount to success and increasingly difficult to deliver.

Achieving improved customer experience can come in many forms. The 2014 IBM Global C-Suite Survey, which interviewed more than 4000 C-suite leaders (known as CxOs), showed that 54 percent of CxOs said customers now have a large influence on their enterprise, and its results showed that outperforming enterprises are 24 percent more likely than underperforming enterprises to collaborate extensively with their customers.

The survey also showed that “the emergence of social, mobile and digital networks has played a big part in democratising the relationship between organisations and their customers. It is also forcing them to rethink how they work.” It is becoming increasingly important to meld the two dimensions, the report says, pointing out that chief marketing officers (CMOs) in particular consider it “critical to put the components of a strong digital strategy in place”.

These digital ambitions include (in order of importance as per the survey results) integration of cross-channel touch points, analytics to capture customer insights, social networks to foster collaboration, a workforce aligned to opportunities and a digitally-enabled supply chain.

Going direct
As digital infuses the physical and vice versa organisations are transforming the customer experience and more than half of CxOs today aim to understand and engage the customer as an individual rather than a category or market segment.

Vaughan Chandler, executive manager of Qantas Loyalty’s new marketing analytics agency Red Planet says: “Marketing is becoming more personal and direct. There is an increasing need for businesses and marketers in general to understand who they are targeting and the effectiveness of their marketing activity across multiple channels, to be able to provide improved visibility, better insights into customer behaviour change and commercial outcomes. The challenge for many marketers is how they gain understanding of who their customers are, how they engage them with the right message, at the right time, and with less waste.”

Insights into customer needs and behaviour come from analysing the data you have on your clients. Nick Hearn, GM of Lab360, a division of Loyalty New Zealand which acts as an agency for third party clients, says that he thinks New Zealand is cottoning on to the fact that the term ‘big data’ is a bit misleading and that we should actually be talking about ‘relevant data’.

“Without the relevant data you are stuck,” he says, adding that one client needed 92 percent of its data cleansed before they could even start. “At a holistic level people don’t want to be shouted at anymore. They want to know they are being listened to – they want one-on-one marketing.”

Advisory firm Deloitte has also highlighted this trend towards using data analytics to treat customers as individuals. In its Tech Trends 2015 report it said: “CIOs and CMOs should embrace the reality that the marketing levers of the past no longer work the same way, if at all. The front office of marketing has been recast around connectivity and engagement – seamless contextual outreach tailored to specific individuals based on their preferences, behaviours, and purchase histories. At the same time, marketing’s back office has been transformed by new technologies for accelerating and automating campaigns, content and positioning – fueled by data and analytics. Together, these new dimensions are ushering in a new breed of marketing: dimensional marketing.”

Deloitte breaks ‘dimensional marketing’ up into four quadrants: customer experience, relationships as interactions, targeted intelligence, and the multidimensional channel. In summary this means customer experiences should be hyper- personalised, contextual and real-time; customer relationships should be built on a dialogue with consumers rather than a one-way broadcast; marketing campaigns should be data-driven; and the technology that powers all of this needs to be omni-channel and able to serve contextual content based on where customers are, what they are doing and what they might want next.

“Today’s data feeds from mobiles, wearables and IoT devices promise marketers rich new streams of information that can be mined for marketing insights and to gauge customer sentiment.”

Experience is everything
Gartner’s recent ‘The State of Customer Experience Innovation, 2015 survey’ reiterated this new push for better customer experiences. In 2014 the biggest focus was on customer experience (CX) programmes to improve the collection and analysis of customer feedback and “opening up” the organisation. While this remains high on the list of priorities this year, organisations have also highlighted that they are interested in projects aimed at improving consistency across channels and acting as one unified organisation.

This is unsurprising as the report authors said that successful CX projects are characterised by improved customer feedback and customer engagement, backed by good leadership, improved processes and multichannel management. The report authors added: “There is no silver bullet to improve customer experience, but a combination of projects can cumulatively contribute to better customer experience and create a hard-to-copy competitive advantage.”

The top three projects to improve customer experience in 2015 are:

• Acting as one organisation to ensure multi-channel consistency.
• Activating self-service; providing tools to select/order/track/stop.
• Collecting/analysing customer feedback/ communicating actions.

Personalised technology
There is a recurring theme in recent research literature – at their base, customer experience projects are about having the right information at the right time so as to be able to act on and even predict clients’ needs and wants. And that requires an integrated platform hub that can act as a single point of truth. More data however, does not automatically mean better decisions. In its summary for the 2014 Digital Marketing Hub Magic Quadrant, Gartner said: “CMOs and digital marketing leaders are under pressure to engage individuals on increasingly fragmented and unpredictable terms, driving the need for a common pool of profile data, analytics, workflow and content resources enabled by a digital marketing hub.”

Gartner named Adobe, Oracle and Salesforce as ‘leaders’ in the digital marketing hub landscape, with IBM and Marketo named as ‘challengers’ and IgnitionOne leading the way in the ‘visionaries’ quadrant.

Oracle has recently established a Marketing Cloud business unit so marketers can have onestop access to all the data they need to inform marketing campaigns. Adobe has also recently announced advances in its integration of big data with creative content, introducing tighter connections between its creative tools and marketing solutions.

Any new technology, will, however, need to allow marketers to deliver individually tailored and contextually appropriate products, services and offers at speed and scale and this will only become all the more pressing as the internet of things (IoT) continues to grow and evolve.

Chandler says: “Customers can be accessed through multi-channel methods that allow businesses to communicate with them more effectively to achieve better outcomes on their marketing spend. It is about finding and targeting the right customer, at the right moment, and at the right time to make that purchase. The connectivity that our customers use today allows us to get a better understanding and insight of how we can interact with them more effectively for better results.”

Today’s data feeds from mobiles, wearables and IoT devices promise marketers rich new streams of information that can be mined for marketing insights and to gauge customer sentiment. In November 2014, Gartner predicted that 25 billion connected ‘things’ will be in use by 2020, compared with more than half of those being consumer devices. A new report released by Cisco and DHL in April 2015 saw this estimate double to 50 billion devices by 2020, compared to the 15 billion that are already connected today. Needless to say, these connected devices are going to be a huge disruptive influence and will reach far beyond the mobile phone and smartwatch scenarios that we are currently getting to grips with.

Big data dealers
There is also a whole industry of new marketing/ analytics agencies springing up – and interestingly they are often business units within well-known enterprises that are monetising their own data. Qantas’s Red Planet and Loyalty NZ’s Lab360 are just two such examples of agencies inside corporates that are backed by massive data banks.

Both have compelling stories to tell about how in-depth knowledge of your customers can make a massive impact on your bottom line. Meanwhile, Air New Zealand and Canadian marketing and loyalty analytics company Aimia have bought Waikato University’s 11Ants Analytics, whose main product is a cloud-based customer science platform, which turns customer data into insights. Air New Zealand and Aimia are planning to use it to develop new products in the travel sector.

Speaking at the AdTech conference in Sydney in March this year, Qantas Loyalty’s executive manager of the group brand and chief marketing officer Stephanie Tully said that Qantas Loyalty is, at its heart, a data and marketing business – one that is paying off nicely for its parent airline. Indeed, Tully said Qantas Loyalty delivered A$286 million to its parent company last year, largely through the sale of points to partners, which benefit from the deep engagement with consumers that Qantas can deliver. Each time Qantas Loyalty sends out an e-message to its members it issues about 50,000 targeted variants.

It’s this experience with data and nurturing personalised customer relationships that eventually led it to establish its new media analytics and research business unit. Red Planet, last year. After all it has 27 years’ of historical insights about 10.6 million members – or half the Australian population. Initially Qantas trialed Red Planet’s service internally for its online Qantas Airways campaigns and found that using Red Planet insights and modelling made the campaigns four times more effective than traditional campaigns the airline had run.

Across the ditch, Loyalty New Zealand has been using ‘big data’ to target customers since 1996. It’s best known for its Fly Buys programme which has over 2.4 million cardholders, but also runs the full-service data and analytics agency Lab360 headed up by Hearn, which combines Loyalty New Zealand’s customer insights with those of its clients to help refine their business and marketing strategies.

Technology may be the key to ‘listening’ to your customer, but Hearn is quick to say that purchasing technology does not make you innovative with technology. Lab360 employs people with machine learning, BI and data management skills to name a few. Its process involves combining a clients’ existing, cleansed data with new sources, in-depth customer profiling and segmentation along with attitudinal research and mapping. This is then translated into implementing improvements to the client’s business, such as product range consolidation, site selection, and cross-sell and up-sell programmes.

In New Zealand these programmes are mainly limited to electronic or physical direct mail campaigns, says Hearn, who thinks that Kiwis are yet to engage in more sophisticated social media marketing, even though the best way to engage with the consumer is digitally. Nevertheless Hearn says that Lab360 is currently trialing iBeacon technology (devices which can send location proximity data to iPhones), and he thinks that while it is currently quite expensive to deploy, the concept will become omnipresent in the future, giving marketers an easy way to interact in situ with potential customers.

Tangible results
Lab360 has had some impressive results. New Zealand’s largest insurer had a 600 percent return on investment when Lab360 used its Knowledge Cube (a proprietary model in which New Zealanders have been split into 38 micro-segments) to create an acquisition database and targeted direct mail campaign. And New World was able to run an individualised mailbox drop campaign for its wine programme in which it created tens of thousands of subtly different versions of the campaign.

Red Planet meanwhile helped bookseller Dymocks to increase member engagement in its Booklover loyalty programme by targeting members with offers relevant to them. Red Planet’s approach was to use Dymock’s data to identify previous high-value members based on their past purchase behaviour. The result was a more than 400 percent improvement in open rates for targeted electronic direct mail, compared with non-targeted; open rates as high as 50 percent on individual targeted campaigns; and a 30 percent boost in conversions.

“While data insights are important, it is still critical to apply a creative approach to marketing and not rely totally on the data and science.”

With results like these it is no wonder that marketers are beginning to look beyond their current technologies to help close the gap between data collection, relevant data insights and concrete actions to deliver what the customer wants.

It might sound like marketing is going down the track of ‘painting by numbers’ but that is not the case. Customers still respond to novelty and constantly want to be ‘surprised and delighted’ by their brand experiences. As Tully said, while data insights are important, it is still critical to apply a creative approach to marketing and not rely totally on the data and science. Marketing campaigns need to be data driven but creative, attentiongrabbing and pertinent to the individual. And that is just the beginning. Modern marketers need to work with the IT department and operations teams to ensure that the overall experience makes good on the marketing promise and listen closely to customer feedback to ensure that they continue to deliver results.

Today we live in a fast-paced world where technology is changing the goal posts on an almost daily basis. Old-style enterprises are rapidly finding themselves challenged by technology-led disruptors, à la Kickstarter, Airbnb, Uber or Xero. These challengers have the benefit of being young and not weighed down by legacy infrastructure, processes and mind-sets. Like a Hamilton Jet they can navigate unexplored waters and respond quickly to market fluctuations and opportunities. They disrupt the incumbents, innovate fast, and can stay ahead as industries adapt. Meanwhile, traditional businesses have spent the past 30-plus years setting their processes in stone and honing their efficiency. Changing direction is done at the speed of a laden cruise ship and sees them left in the wake of the disruptors, unable to respond quickly and ill-equipped to embrace innovation.

Many IT departments used to be like these old organisations (some IT departments still are, but that is a tale for another day). Large and lengthy IT projects developed a reputation for being risky and prone to frequent and spectacular failure. The traditional Waterfall approach to IT projects hinged on preparing a detailed business case then executing it to the letter before testing and deploying it. This could take years, by which time needs had changed and the end users were dissatisfied by the result.

Is agile mainstream?
In the 90s a group of radical software developers and interested parties met to discuss better ways of developing software that would result in fewer project failures. What ensued was the Agile Manifesto which cemented the core tenets of developing software while avoiding project failure. Its core values are:

• Individuals and interactions over processes and tools
• Working software over comprehensive documentation
• Customer collaboration over contract negotiation
• Responding to change over following a plan

Essentially it meant lots of small projects that allowed developers to fail small but often and to fix issues as they arose. These ideas were reiterated in the landmark Chaos Report released (way back in 1995) by The Standish Group. It concluded that smaller project time frames, with delivery of software components early and often, would increase IT project success.

Since then, the now-annual report’s central thesis has continued to say that smaller projects are essentially better and, a decade later, the message is gradually getting through.

Today there are many flavours of agile development, from Extreme Programming to Scrum, Sprint, Lean and Kanban, and it is no longer considered fringe. Since agile frameworks are designed to be flexible, pinning down a specific definition deflects from the more important issue of finding the most efficient way to deliver IT projects. What truly differentiates an agile project, however, is its bite-sized projects and constant review of working code. Agile’s mini-projects, or development cycles, are usually referred to as ‘sprints’. Each sprint involves planning, design, development, testing and deployment activities and delivers functioning code to the customer for review and signoff throughout the duration of the project. Many well-known companies from Suncorp to Telstra, NAB, Jade Software and Xero now swear by its effectiveness.

Craig Beveridge, COO and general manager of Jade Software in Australia, a full-service provider of business software and technology, is responsible for solution delivery and capability using agile methodologies and works closely with big, complex clients on challenging software projects around the globe. He says that working in an agile manner allows organisations to test their ideas in the market very quickly with no surprises at the end of the project. From concept to pilot they could have something up and running within six to nine months.

“That’s really, really quick when you consider you have done your market research and your testing along the way and by the time you get to the end you are actually up and running and you’ve got customers using your product.” It sounds like common sense, but many large organisations are yet to embrace an agile workstyle.

Can large organisations be agile?
The inherent flexibility that has made agile frameworks so successful can also be their undoing when it comes applying them to enterprise environments which thrive on clear structures and processes. Adam Boas, advisor to the Agile Australia conference and delivery lead at Australia’s REA Group, which uses agile development frameworks extensively, says that new adopters are typically looking for some clear instruction on what to do and instead get advice on how to approach things and some useful tools.

“It’s been a bit of a disappointment for some companies that have attempted to adopt agile frameworks and agile thinking because most mature agile frameworks refuse to tell you what to do,” he says. Indeed, they encourage you to pick and choose the tools that are most useful to you and most mature agile companies use a mixture of techniques cherry picked from the various agile frameworks.

Not only do larger organisations struggle with the flexibility of agile frameworks, they can also find it difficult to deal with the lack of hard deadlines and a responsive project management approach. Boas says that the introduction of Scrum, which draws heavily on PRINCE2 project management principles, helped to put some structure around agile in terms that traditional businesses are more comfortable with. In particular it helped to dispel the perception that agile frameworks lack accountability.

Scrum has been a very popular agile process within enterprises, but Boas says the more mature organisations often move past that and adopt the principles of Lean, which have more of a focus on just-in-time feature delivery. Even so, he finds it frustrating that many companies start to see a better outcome using PRINCE and Scrum and then don’t take it further.

“There’s a common failure mode where they cease to question whether they can get more, so they often get frozen in that early phase of agile adoption and confuse that with having completed the journey.”

Flexible organisations
The core concepts of agility are not only relevant for IT projects but are transferable across any type of work and any line of business. Although big business has spent the last three decades solidifying its processes with a focus on efficiency, the rise of digital business models is driving a change revolution. Gartner analyst Michael Warrilow said at a recent Gartner Predicts 2015 briefing, that by 2017, 70 percent of successful digital business models will rely on deliberately unstable processes designed to shift as customer needs shift. This will require an agile and responsive workforce that is empowered to make decisions and is held accountable for those decisions.

Beveridge, who uses agile frameworks throughout Jade, says, “I think it’s quite easy to implement agile teams in verticals within an organisation. The greater challenge is to get an agile project which is cross-disciplinary, especially once you start bringing in partners or externals. In my view it’s that organisation agility that needs to step up next.”

And it is a challenge. You can have very good pockets of agility within a business but the more fingers you get in the pie the more difficult it becomes to remain agile. “I believe the key to a successful agile organisation is to focus on the overall process or project that you are trying to deliver and introduce agility at the executive level all the way down. Then you look at how you apply those agile principles to all those processes regardless of how big or small they are,” he says.

Xero is another organisation that has brought agility into its entire organisation, not just its product development teams. Jolene Enoka, who heads up Xero’s online marketing, spoke at the AgileNZ 2014 conference about how the marketing team has taken on the principles of agile. Eighteen months ago Xero had one centralised global marketing team of 20 based in Wellington. It was frequently a bottleneck to progress and at one point had 300 projects in its work cue. “We knew we needed to change so we took a few cues from what was going on in the product development side of the business,” says Enoka, who admits that agile was completely foreign to her at the time but now feels like common sense.

They chose to introduce what they call the ‘pod system’ (similar to a Scrum team) which already operated in the product development side of the business. Each pod is cross-functional, co-located and autonomous, made up of all the skill sets that are needed for a marketing project. Xero established eight pods around the world and de-centralised the newly named ‘global marketing services team’ in Wellington into another six pods. Focus was one of the key outcomes from the change as staff suddenly had a sense of purpose and knew what they needed to work on, which was both empowering and sped up the pace of delivery.

Enoka says that the real risk with de-centralising the team was that there would be an alignment issue and the different pods would start to pull in different directions, but a common purpose, regular communication both within the pod and back to the wider marketing team and trust that the pods could operate autonomously and effectively were the answer.

As for specific agile philosophies that have found their way into marketing, Enoka says that the team has stopped looking for a silver bullet or big bang solution, working on a succession of small improvements and projects that incrementally contribute towards overall success. Iteration and frequent testing in a live setting to gauge customer priorities have become the new mindset.

This idea of breaking big problems into small problems is core to agile operations, says Boas. So are transparency, accountability and stakeholder trust – every day team members are called on to report on the progress of the tasks they are responsible for (and everyone is responsible for something). The Kanban storyboard is a good tool that helps teams and companies to visualise throughout REA. The HR department, for example has a storyboard for hiring people, so you can see what is going on in the team at a glance.

Innovation teams
If you want to inject agility into an organisation without changing everyone, Beveridge suggests using specific innovation teams.

“These teams implicitly have the authority or permission to take an idea and research and test it quickly. If the idea works it can then move it into a more mature execution within the main business,” he says.

These sorts of innovation programmes are naturally well-supported by the executive committee and, if their projects are set in the context of the long-term business strategy they can also be a good way of introducing innovation to the wider organisation. A ‘mid-point’ team made up of people from the main business can sit between the innovation team and the business-as-usual teams to make the link between the forward thinking and the company’s day-to-day operations.

Beveridge adds that “an evolution rather than a revolution type approach” to system development is a more effective means of changing the backend of the business in today’s budgetary environment.

He says another really important aspect of using agile project frameworks is that they help organisations to build a proper and successful capability model to help them face and even take advantage of the disruption that digital technologies bring to industries.

Over the horizon
Beveridge has one word of warning however. He says that you don’t want to lose what he calls “the vision over the horizon”.

“Agile projects are by nature focused on what the next outcome is, so you don’t want to lose your long-range planning and strategy,” he says. One way to manage this is to ensure that the people working on the project don’t only understand the tactical needs of the day but also how they fit into the two to three year strategy for the company.

• For innovation projects where the outcome is to identify new products, services or processes that may disrupt the market or build a competitive advantage, our teams draw heavily on the tenets of design thinking and often use design studio methodology to quickly establish a very solid design that gets a huge amount of input at the beginning of the project. We’ve literally iterated dozens of variants in a couple of days using this method. One of the major benefits of these agile design approaches is that they allow you to take the business stakeholders on a journey very quickly that allows them to test all their ideas and distill them down to those that matter most – this insight might not come out until much later in a waterfall project.
• To develop digital solutions that allow businesses to inform, engage and transact with consumers we use Scrum most often. It lets a team start delivering software almost immediately and it allows us to respond instantly to market and user testing. Scrum can help you get the very best value-for-money in terms of features and functionality, in a fixed time frame.
• Before development begins we make heavy use of all sorts of rapid prototypes to validate scope and requirements and this can range from paper sketches to clickable wire-frames or even throw-away applications.
• To manage an ongoing programme of work and the associated work-flow we will use Kanban boards which allow us to quickly identify bottlenecks in work and ‘swarm’ to get things moving again.