1. Disruptive Technology...
Changing Enterprise Architecture
as we know it
David Turner
Head of Architecture
@djturner90
davidjamesturner
Good afternoon, pleasure to be stood in front of you all this afternoon to talk about DT and more specifically to look at…
how modern Enterprise Architecture is having to change to meet the demands of the business, deliver innovations and plan for disruptive technology
As Head of Architecture at Hermes I spend some of my time working with other IT stakeholders and business areas to investigate and evaluate potential disruptions: 
3D printing 
Robotics 
Smart machines 
internet of things 
crowd-sourcing 
Gamification 
Wearables 
So would like to expand on a little of this and discuss how disruptive technology is changing Enterprise Architecture as we know it... 

2. About Hermes Key facts: Re-branded from Parcelnet in 2009
Handled nearly 220 million parcels in 2014
Hermes is now the second largest carrier in the UK to Royal Mail
Largest carrier for FGH, JLP, Next, ASOS, QVC, Clarkes and more…
Presence in UK, Germany, Austria, Italy and Russia
Almost doubled in parcel volume over the last 5 years
Operates a network of over 10,000 lifestyle couriers and 5,000 ParcelShops designed to give end customer choice and convenience
Largest European PUDO network (35,000+)
Launched C2C parcel delivery service myhermes.co.uk in 2009
But first a shameless plug…

3. Hermes Today We recognised for low cost and multichannel choice.
Our Services:
Fully tracked parcel delivery services:
24hr and 48hr services, 7 days a week
To home via 10,000 95% 1st time success rate
To ParcelShop via 5, % 1st time success rate
Offer International delivery services
So certainly in our industry we are seeing the advent of the digital business
And seeing an increase in the pace of potential disruptions through new technologies - both in our industry and looking over the fence in near-neighbour industries like retail

4. Outline
What do we mean by Disruptive Technology?
A look at some potential disruptions
3D Printing
Gamification
How Enterprise Architecture is changing?
What does that mean for EA?
Tips on how to tackle this

5. Disruptive Technology
Helps to creates a new market or entirely new industry
Will eventually disrupt an existing market
Displaces earlier technology
Improves a product or service in a way the market does not expect
Example
So an example would be the way the personal computer displaced the typewriter, which changed forever how we work and communicate
Arguable the laptop and mobile computing then created the possibility for a mobile workforce who could connect to corporate networks on the move and collaborate anywhere. In many companies the PC has been displaced by the laptop
The rise of tablets/ smartphones, the app market and how this has led to the consumerisation of IT arguable is displacing the laptop
The point is there have always been disruptive technologies
– the locomotive, the mass-produced automobile, the light bulb
However, in the past the cost of entry has always been high which creates a barrier – meaning few ideas made it through
The digital revolution, the break through of this idea that every business is a digital business rewrites these rules because all of sudden the cost/ barrier to entry is lower.
Digital disruption is happening at a much faster pace than every before

6. Sustaining Technologies Disruptive Technologies
The Challenge
Sustaining Technologies
Disruptive Technologies
Incremental Improvements
Already established technology
Existing market
Existing customer base
Sits more comfortably with corporate goals
Lack refinement
New technology
Market may not yet exist
Lack of an audience
Value difficult to measure
Sustaininng Technologies – sit more comfortably with organisations because they sustain their focus, goals and customers
Improve existing products and increase customer satisfaction
Improvements in the things that the current customer wants
E.g. Christensen gives in his book is disk drives – with high capacity and smaller. This was driven by PC customer’s wants
Disruptive Technologies
Initially do not improve the focus of the company
Markets may not yet exist – they have to created
They may also underperform established methods
Which way does your organisation swing?
So Clayton Christensen summarised well the reason some larger corporate companies fail..
They stay close to their customers

7. Clayton Christensen…
“…a more fundamental reason lies at the heart of the paradox: leading companies succumb to one of the most popular, and valuable, management dogmas. They stay close to their customers.”
The problem is customers wield extraordinary power in directing a company’s investments
particularly for large corporations as there is more at risk
Before managers decide to launch a technology, develop a product, build a plant, or establish new channels of distribution
they must look to their customers first:
Do their customers want it?
How big will the market be?
Will the investment be profitable?
But are these the right questions to be asking when looking at disruptive technology?
Are existing customers the right people to be asking?
Who isn’t use your product/ services? Why not?

8. Predicting the future is hard
One thing is certain…
Predicting the future is hard
So what do we do?

9. Look for what’s difficult and remove friction
“…we can understand the future if we understand what people are doing when it's hard” Henry Jenkins

10. Look for what’s difficult and remove friction
1999
2011
2013
1990
Each step in this evolution removed some friction versus the previous step.
People struggled in the 90s to digitise their vinyl collections
Napster – gave us peer to peer file sharing and playlist creation from our 400MB hard drive  PCs, with 486DX processors!
Enter the MP3 player… listening to digitised tracks becomes mass market.
Enter Spotify…
you can listen to streamed music on multiple devices (car, tv, pc, phone) at your convenience,
And if you go premium go play offline
And don’t bother to own the media!

11. Removing Friction Removes the friction of taking payments
More than 2 million US individuals and businesses use Square, and they process $15bn in annualised transactions
Removing Friction Can Catapult new market entrants

12. Removing friction catapults new market entrants
Founded in 2008
Rent out lodgings – connects hosts and travellers without owning any rooms itself
Opens up new opportunities for travellers and home owners
1 millionth booking in 2011
Now valued at 10 billion dollars
250 employees

13. A disruption long in the making?
Digitally disrupting your product and process
People will never do it, it will cost too much
Barclays account holders can photograph their cheques via their smartphones to pay them in
Digital disruption..to build a better product experience
Create stronger customer relationships
Test and measure - expect and accept failures
Small teams to generate innovations/ ideas quickly
able to photograph their cheques and send them electronically from their smartphone - Barclays customers
£300million worth of cheques are never paid in

14. And the disruptions just keep on coming!
Users and business colleagues are empowered by choice
Thanks to consumerisation they now have more choices
They are seeking help outside of traditional IT to deliver innovative business solutions
Their expectations have changed
Speedy delivery of new features

15. Printing is back and now it’s cool!
3D Printing…..
Printing is back and now it’s cool!
Printing is back and cool.
Should it have died 10 years ago – remember the paperless office?
But it’s back
Actually 3D printing is 25 years old!
40 manufactures worldwide
Consumer-oriented devices
Makerbot, Airwolf, Cube
Dropping in price all the time - £600 at Maplin for a velleman printer kit

16. 3D Printing….. Or is it scary?
3d Printer – working gun, 50,000 copies of blueprint were downloaded almost immediately
3D printer – counterfeiting goods, loss in intellectual property, toy manufacturers (lego).
3D Printing – chaos, who owns the templates, who is responsible for assembling the parts together, who is responsible for the quality
3D printing of tissues and organs (bioprinting) – print human skin for people who have been burnt
Human liver tissue is been printed
How far will it go? Will we be comfortable with it – if we were it wouldn’t be disruptive

17. 3D Printing In Logistics
The end of the globalised supply chain?
Massive investment from manufacturers
Localised/ Regional printing
Impact on logistics
3D print centres close to sales markets
Reduced shipping needs
Evaluation/ Action
Longer term impact still unclear
Next 5 years, “not significant” to “low” risk
Observe, possible pilot 3D printing service
Over the last few years, the technology has evolved at a rapid pace
Market share of additive manufacturing is likely to grow.
Rapidly growth in various 3D print technologies - more and more industries will invest in it. 
Localised printing/ 3D printing centres
Will it reduce need for shipping?
People just pop into local store
3d blueprint is purchased and transferred to a local printing station and constructed/ collected at your convenience
Will the logistics firms of the future be 3D printing stations?

18. Gamification…..The Fun Way to Engage
The "gamification" of business processes
One of the latest phenomena aimed at making the workplace more engaging and more productive.
Companies are starting to recognising the potential benefits of gamification
Apply feedback, measurements and incentives
Same techniques that game designers use to keep game players interested
To continuously improve business processes.

19. Increased customer complaints Lack of engagement
Gamification…..Why?
Work can be boring
Increased errors
Increased customer complaints
Lack of engagement
Create culture of continuous improvements
Clear and immediate feedback
Believe it or not work can be "boring"
And when it is…
it results in errors, customer complaints, employee burnout
High personnel turnover.
So you need to increased employee engagement
driven by well-designed business processes using gamification
enables immediate feedback
clarity of the goal and clear rules for engagement

20. Provide visible outcomes to employees
Gamification…..How?
Provide visible outcomes to employees
Assign value to each activity or task
What and how will you measure?
How will you reward?
Metrics, UI, Game Design
Use of game mechanics in non-entertainment environments
Motivate a change in user behaviour
Game designers spend a lot of time understanding how to keep players interest
Data coming out of operational systems can be made visible and
actionable through this automation, and gamification can be applied using technology already in
Use by employees - desktop computers, mobile devices, wearables

21. Gamification…..Be Careful
Wow factor
Cost versus Benefit
UX/ Game Design skills
Culture
Big Data
Plan for Iterations/ “Game Fatigue”
Don’t fall victim to the wow factor
Work with the business to understand the business processes that need improving
May be to digitise the process first
Costly to build/ implement and maintain versus benefit
UX/ Gaming skills may be required
Culture – not everyone is motivated in the same way. May back fire
Big Data
Data sets required – both structured and unstructured, high volume, low latency challenges
Game fatique

22. Enterprise Architects…
This digital revolution will impact every business and not just those that deal directly with consumers
Every business is an IT business
Technology will change what we do – it rewrites the rules of innovation
IT changes the way we live, work and play
Which quite frankly is great news for Enterprise Architecture
Organisations are refocusing their efforts on EA
Great News! EA is now more important than ever before

23. Enterprise Architecture is Changing…
To meet new demands of the business
To focus on business outcomes and results
To proactively generate ideas
To evaluate disruptive technology
To determines the impact
To create radars, transformation roadmaps
To become a technical business partner
Users and business colleagues are empowered by choice
Thanks to consumerisation they now have more choices
They are seeking help outside of traditional IT to deliver innovative business solutions
Their expectations have changed
Speedy delivery of new features
Evaluating disruptive technology
Likley to impact your industry
Looking at near-neighbour industries to provide cluse
Evaluating their capailities, use cases and opportunities

24. Vanguard Architecture
The EA disciplines…
Vanguard Architecture
The advanced guard, leading the Charge
Primary Concerns:
Drive innovation
Disruptive Technology
Foundational Architecture
Maintain the estate
Primary Concerns:
Systems of Record
Maintain primary technology estate
Vanguard enterprise architects
Primarily concerned with driving innovation with disruptive technologies
Systems of Engagement – touch customers, partners, employees
New channels and enablers via smartphone, tablets
Focus on “Business moments” delivery
Foundational enterprise architects
Concerned with systems of record and maintaining the (primarily technology) estate
ERP-type systems that run our core business processes
Long development and deployment cycles
BUT in reality the world doesn't divide in two that easily
Have to balance the two
Vanguard – 20% of your time

25. Roles and Competencies
Vanguard
Foundational
Business
Understand the business, the organisation and the culture
Understand and analyse the business model and ecosystem
Focus on the customer
Develop a keen business insight
Adopt a global mindset
Take accountability and behaviour with an entrepreneurial spirit
Behavioural
Think strategically
Thinking creatively
Influencing and persuading
Risk taking – be bold
Decisiveness – make a decision and act
Technical
Understand existing systems and technology
Designing and developing solutions
Integrating solutions

26. What does that mean for EA?
Identify disruptive trends and technologies that you will investigate
Develop clear method for prioritising
Work with business to understand opportunities
Develop business outcomes statements
Evaluate the opportunity, cost, risk and impact
Prioritise into set of roadmaps
Show timings
Interdependencies across projects/ channels
Firstly identify the disruptive technologies that you will analyse – more on this in the next slide
Prioritise those that merit further investigation
Rationalise and carry out deeper analysis in the context of business scenarios
Interact with the business and other IT groups
Develop business outcomes statements
E.g. To deliver 100% first time delivery success to customers
Evaluate
Does it cause you to rethink your future state of architecture?

27. Identify Disruptive Technology
Build a process that quickly allows you to identify disruptive tech
Market Research
Industry-specific journals
Look at competitors
Near Neigbour Industries
Hype cycles and waves
Near neighbour industries can provide clues about how such technology may be leveraged
So for Hermes that would be retailers

28. Build a Radar
We love radars at Hermes – because our execs don’t like words
It is an effective communication tool, can put it up in depts as a poster
This one shows relevance, maturity, distance from the market

29. Build a Radar And this one Shows business segment/ channel Timeline
Colour coded relating to customer facing or operational
And the horizon shows our business vision/ ambition programme
So shows how we propose aligning to the business strategy

30. E.g. RFID tags
Understand availability, maturity and impact of the tech
Developed in 1980s
Expensive
Only used in high-value application
Now costs have dropped
Commonplace
Hotel Room Keys
Ski Pass
What are likely use cases for the business?
Use your radar to chart expected timeframes
So in 1980s very expensive – one of early deployments
Used to track high-value vehicles
Track nuclear material
It needed high-value to incur deployment costs
Now costs dramatically reduced
Commonplace
Casinos used RFID enabled chips to communicate with sensors/ antennas throughout casinos
Track gamblers average bets/ location of high-denomination chips
Famously thwarted 1.5 million dollar robbery from Bellagio in 2010
Chips were immediately deactivated when they left the hotel

31. Develop a set of performance metrics Build into objectives
Business-driven Measures
Develop a set of performance metrics
Build into objectives
Communicate with key stakeholders
Increase Customer Satisfaction
Increase business efficiency
Increase in new revenue
Faster time to market
Decrease
Business
Understand the business, the organisation and the culture
Understand and analyse the business model and ecosystem
Focus on the customer
Develop a keen business insight
Adopt a global mindset
Take accountability and behaviour with an entrepreneurial spirit
Behavioural
Think strategically
Thinking creatively
Influencing and persuading
Risk taking – be bold
Decisiveness – make a decision and act
Technical
Understand existing systems and technology
Designing and developing solutions
Integrating solutions

32. Use a heat map or RAG status to show benefit…
This shows timeline – years to mainstream adoption
And benefit
Colour code to allow execs to understand where to focus their attention 

33. Create an Innovation Team and Charter
Clarify what innovation & enabling technologies means
How it will be successfully delivered?
Define purpose, scope and success measures
Involves people from all across the business not just IT
Gain executive support to officially empower the team
Key metrics to measure
Quality of the innovation
Innovation reach,
Small teams to generate innovation and ideas quickly
Test, measure and repeat
Expect and accept failures
It can means different things to different people – it can be negatively charged
Initiatives fail - become of ambiguous goals, inconsistent support from wider enterprise

34. And Those Pesky Drones…
How long before we see 30 minute delivery from point of order?
30 minute delivery for customers (initially within 10 miles of a fulfilment centre)
Aim to have it up and running within 5 years.
DHL already runs a regular drone service to a little German island in the North sea
2 years?
5 years?
10 years?
15 years?

35. Our Answer…
We just so happen to share our name and it would appear logo! with a miltary UAV
Perhaps we can use these to shoot down Amazon drones!
That would certainly reduce their first time delivery success!

36. But they are disruptive…
Parcels/ packets under 2kg
Customer within 10 miles of fulfilment centre
Automous road transport more likely to impact
Gartner 2014

37. Key Takeaways… Next Week? Assess current scope of EA
Include time for Vanguard Architecture
Next 30 days
Align objectives to business outcomes
Develop an Innovations Radar
Extend scope to an Innovations Charter in partnership with business
Next 60 days
Form a small innovations team
Generate ideas/ prototypes
Test/ Measure
“ Signature-ready” business decisions

38. Takes months to mature from one level to another and is living and continually evolving, so this isn’t a short-term fix