Where physical meets digital
This is the third instalment in a set of a few positively slanted articles that will try to explain the art of the possible for information technology (IT) service providers in the new “digital” world. I have been polling senior executives at IT service providers to understand how each sees the “digital” future. They each have slightly varying views, but all have a strong definition of how and where they want to play in the future, which is heartening, given that there is much fretting among external observers that the future is murky for IT services firms. In addition to chronicling their views, I will highlight examples of work already completed for each firm’s clients to envision, design and finally deliver solutions that fit with the new direction that technology is now going.
One of the executives I have spoken with is Sanjay Jalona, chief executive officer of Larsen & Toubro Infotech (LTI). I first met Jalona around a dozen years ago when he was the delivery leader for Infosys charged with that firm’s performance on one of Indian IT’s first “mega deals”. The client on this transaction was ABN Amro Bank NV. The global Dutch-heritage bank had retained my then employer TPI to advise on the deal, and as the lead negotiation adviser to the client, I sat across the table from Jalona and his team-mates who went on to win a large proportion of that transaction. Jalona subsequently climbed the ladder at Infosys and was eventually recruited to spearhead LTI’s evolution from being a privately held subsidiary of Larsen & Toubro Ltd (L&T) into a separate, publicly traded company.
Jalona doesn’t like the term “digital”. He would rather use the term “exponential technologies” to define this new world, and by this he means a raft of advancements in technology: 3D printing, virtual reality, face recognition software, artificial intelligence, automated data analytics and so on. His view is that these technologies govern about 20% of the IT spend at end-clients in today’s world, but that it is growing at speed—he expects that these technologies will constitute over 80% of the spend by the year 2025.
He is perplexed that while people talk incessantly about a digital world, they seem to forget that the physical world will never go away. So rather than focus solely on digital, he would prefer that the industry focus on the meeting point of the physical and digital worlds, which is where he feels the real value will be delivered, in places such as manufacturing shop-floors, airports and oil fields. This focus on the physical aspect is unsurprising, given LTI’s long gestation period within L&T.
This marriage of the digital and the physical is apparent in one of the examples Jalona provided. His firm has worked with an oil field firm to automate a large part of the repair and maintenance process of oil extraction machinery that is an integral part of keeping an oil field at peak production efficiency. Many critical pieces of machinery at these oil fields fail with alarming regularity, necessitating service on a regular basis. Jalona says his team worked with the client to put in place an Internet of Things (IoT) solution by building in sensors, beacons and other parts of electronic componentry into these pieces of machinery that could predict a critical machine failure before it occurred. The information exhaust produced by the data that this IoT solution provided also allowed for LTI to accurately predict which spare parts were most needed for the repair of these critical machines, and to instruct its client’s logistics systems to place an appropriate quantity of the right spare parts in supply dumps closest to the oil fields, thereby reducing turn-around delays on repairs caused by a shortage of the right spare parts.
I have written before in this column about how Xerox tried to build such an IoT solution many years ago for its large installed base of copiers and printing machines in North America, which also needed service and repair on a regular basis. That firm didn’t have much success rolling out the programme since the telecommunications and technology infrastructure available at the time was unequal to the task. In many ways, Xerox delivered several technologies to the world decades ahead of time: the mouse, windows, the facsimile machine, the laser printer, and collaborative computing, but failed to capitalize on them.
Today’s world is different. As Jalona says, “If you can imagine something, there is almost certainly a technology already available that can do it.” The art of the possible now lies in obtaining and then orchestrating that technology solution so that it can translate the imagination into reality.
Another example was LTI’s work with India’s Central Board of Direct Taxes (CBDT). LTI claims to be the primary partner for CBDT’s outcome-based program called Project Insight which is one of the largest digital transformation initiatives in the country, and which provides comprehensive “big data analytics” and surveillance solutions.
Jalona says that this program will promote voluntary compliance and build confidence in taxpayers; he also calls this the “mother of all automated analytics projects” which will provide the CBDT deep insights through automated analytics into the spending patterns of over a billion people, as evidenced not only by obvious areas such as their credit card expenditures, but also through their activity on social media—where people like to post photos of their latest fancy acquisitions or expensive foreign holidays.
If someone is paying no tax but is meanwhile posting pictures on Facebook of serial trips to Paris for shopping splurges, something is probably amiss, and the CBDT might want to know more. As I heard a wag once say about social media, “what (George) Orwell failed to predict was that we would buy the cameras ourselves and our biggest fear was that nobody would be watching”. It appears that the wag was wrong, and that Orwell was right after all.
Siddharth Pai is a world-renowned technology consultant who has personally led over $20 billion in complex, first-of-a-kind outsourcing transactions.