Smart technologies, big data and the Internet of Things are reshaping the world we live in. INNOVATE@ISS asks Khoong Chan Meng, Director & CEO of NUS-ISS, to forecast the five top trends that will revolutionise business landscapes in 2016.
Q: The world is becoming increasingly more connected with smart devices. In fact, by 2020, it is predicted that some 50 billion smart devices will be interconnected in the world. How would this affect consumers, IT professionals and businesses?
This interconnectivity is what I call 'Smart Everything'. We are now at the tipping point where the Internet of Things is ready for prime time. Today, each of us easily owns three to five smart devices, from wearable and audio devices to communication and tracking sensors. These interconnected devices generate a lot of information that is growing exponentially. The level of intelligence and behavioural patterns hidden in this data is phenomenal. It will significantly change the way the world works.
Take robotics for example. This used to be available exclusively for industrial use, such as for car manufacturing and precision engineering. Today, they have found their way into consumer products in the form of vacuum cleaners and drones. Driverless cars have become a real possibility. Behind all of this technological innovation is the software development and big data in the cloud that's making the devices smart. The algorithms are a key critical factor in defining not just the industry, but also the world we live in. So, 'Smart Everything' is one of the five megatrends we will observe in 2016 and beyond.
Q: You mentioned five megatrends - so what are the other four?
The others are 'Digital Disruption', 'Data Tsunami', 'Cyber Insecurity' and 'Humanity 2.0'. For 'Digital Disruption', the classic examples by now are Uber and Airbnb, which have up-ended the taxi and hotel industries respectively. However, the disruption caused by technology transformation is becoming far-reaching and dramatic. Take the cargo transportation industry for example, where something as remotely related to 3D printing is now posing a serious threat to this traditional industry. With 3D printing, replacement parts and even entire components can be replicated on-site instead of buying and shipping from the original equipment manufacturer. Logistics demand will fall as a result.
We are seeing similar disruption in the financial services sector. It is now possible to find more than 100 startups providing different services traditionally offered by a single bank. Banking services are fast becoming unbundled. The more progressive banks in Singapore are learning to disrupt themselves proactively. They are experimenting with multi-modal operations and investing in FinTech startups in order to understand the emerging technological landscape and ride the wave of change. As new processes and business models emerge, jobs, skills and regulations must also change to suit the new way of doing things.
Q: Will this lead to more data and information being generated?
Internet of Things and mobility are already bringing about a 'Data Tsunami'. The ability to capture and make sense of data in real time will become increasingly important. Organisations must decide where to locate the data, how to capitalise on the information, and the tools to apply for better business decisions. The market insights will enable them to stay ahead of the competition.
While data collection can be crowd-sourced, companies should develop the ability to process and make sense of the data in-house. At the end of the day, there's only so much time you have as a human decision maker, so you have to visualise, analyse and decide in real time. Analytics is a growing field, and it's useful for employees to learn how to derive stories from data - understand the trends and picture what's happening - so that they can direct their attention to areas that require further analysis.
Q: Will this 'Data Tsunami' cause consumers and business to become more vulnerable to cyber attacks?
There has been an increase in both the number and sophistication of cyber attacks in recent years. Beyond the run-of-the-mill identify theft and hacking, cyber criminals are exploiting systemic weakness within the companies due to organisational silos and lack of user awareness. A study in 2015 by IBM found that it costs US$3.8 million every time data is breached, a 23% increase from 2013.
Financial institutions are particularly vulnerable to cyber crimes. As a result of 'Cyber Insecurity', many banks have begun to move their technology on to a defensible architecture. Some are building new platforms, data clouds and virtual desktops to protect sensitive data.
The 50 billion interconnected smart things in the near future can potentially mean 50 billion points of cyber insecurity. Most of these points are at the consumer end and are insecure. The attack surface exploitable by cyber criminals is vast.
Q: How will digitisation transform the way we live?
These days, toddlers are exposed to digitisation from the moment they're able to hold something in their hands. Clearly, digital technology will continue to enable and improve people's lives, but lifestyles are also changing as innovation becomes more and more embedded through wearable designs, augmentations and, literally, through implants. I call this 'Humanity 2.0'.
With the ability to harness more information and power in real time, human expectations will begin to change. The interfaces and relationships between man and machine will become more integrated and sophisticated. Beyond IT skills, design thinking and a keen understanding of human behaviour will become more critical.
Q: How should we respond to these five megatrends?
Let's look at it in the context of the three groups you mentioned earlier - that is, consumers, IT professionals and business leaders.
As consumers, we should embrace and make the most of these megatrends or risk being left behind. Learn to collaborate and leverage information in the community to take advantage of this digital power.
For IT professionals, it's time to go beyond technical skills. Learn to view architecture and technology integration in a different way, and to develop the discipline to combine sciences with humanities and the softer side of things. To be successful, you've got to be more holistic in your problem-solving approach. All IT professionals need technology, business and people acumen.
Business leaders will have to understand the digitisation impact and lead their organisations through this change. The worst thing for a leader is to remain status quo, because the competition is going to leave you far behind. Invest in people development so that employees can make better sense of the changing world and develop the foresight to anticipate change - like building an airplane in the air as we are flying. It is about building an organisation that is highly adaptive and future-ready.
Khoong Chan Meng is Director and CEO of NUS-ISS. He is driving NUS-ISS to develop and inspire the next generation of infocomm and digital business leaders through education, applied research and consulting services. Chan Meng has more than 27 years of holistic international experience in the industry. He was previously Group Chief Information Officer (CIO) at RGE, and prior to that, the Government CIO of the State of Qatar. To learn more about the five megatrends or to prepare your organisation for the digital transformation, get in touch with Chan Meng at isskcm@nus.edu.sg.