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The World Beyond Blockchain – Part 2/3: The Eye of the Storm

February 15, 2018 1 comment
Even as early as 2013, it was already clear the immense impact that Blockchain could have on: industries, individuals and society at large. Even as Bitcoin futures markets were launched in late 2017 (complete with cryptocurrency primer), and as the Bank of England considers introducing a UK cryptocurrrency, it is instructive to observe the speed at which things develop and evolve, almost on a daily basis. For example, the intense volatility of a major cryptocurrencies such as Bitcoin, with over 50% drop from a peak of almost $20,000 (in Dec 2017) to less than $8000 (in Feb 2018) is actually considered by some to be business as usual. Blockchain expert, Haydn Jones, at BlockchainHub, suggests that such highs and lows are actually indicative of active trading by buyers and sellers in a robust market. Besides, several other factors may also have exacerbated the huge price movement, e.g.: price manipulation (see allegations against Bitfinex / Tether), opportunistic short selling, tougher regulatory landscape, and even the Chinese / Lunar New Year!

 

 

Regardless of ongoing cryptocurrency price fluctuations, the above diagram depicts several key industries and activities which are currently or imminently undergoing, significant disruption by the Blockchain.

 

According to Blockchain researcher, Bettina Warburg, the Blockchain “provides a shared reality across non-trusting entities” which helps to: reduce uncertainty (via transparency), assure identity (via trust authentication), enforce asset tracking (via auditing) and guarantee execution / delivery (via smart contracts), all powered by mutual mistrust. Therefore, any industry or institution that relies on trusted 3rd party mediation is open to disruption by solutions that remove the need to know or trust the other party in a transaction. The Blockchain’s distributed, decentralised ledger of immutable transaction blocks is the trust platform upon which such transactions can occur. The successes of Bitcoin, and other cybercurrencies, attest the fact that the Blockchain is indeed the protocol that drives the so called Internet of value. It truly brings to life Professor Niall Ferguson’s assertion that “Money is trust inscribed”, even in the digital realm.

 

So many examples abound of new and pre-existing use cases for cryptocurrencies, smart contracts and DAOs (aka Decentralised Autonomous Organisations). They encompass diverse areas and players too numerous to mention and a recent CBInsights Webinar presentationoutlines the use of Blockchain in the enterprise.

 

The rising star du jour is the use of ICOs (or Initial Coin Offerings) for fund raising, which enables teams to raise sometimes eye watering amounts of money over a short space of time in exchange for coins or utility tokens at the launch of their solution. One recent ICO raised $36 Million in 1 minute! In comparison, you can probably see why the dot com bubble could be considered a sedate walk in the park.

 

Another emerging trend are faster, more scaleable, and fee-less cryptocurrencies which can be used to facilitate the low value and high velocity / volume transactions needed for the Internet of Things (IoT). These are next generation networks designed to get even faster through-put as the size of the network increases – in true to life network effect. Key players include IOTA, RAIBlocks and the proprietary Hashgraph. However they are all very much bleeding edge propositions, with many questions as yet to be answered.

 

Several concerns or potential roadblocks exist on the runaway expansion of the Blockchain, such as:

 

  • Increased regulation – There’s a looming threat or promise of tighter intervention by regulatory bodies and governments, especially for ICOs due to their conceptual proximity to the highly regulated securities industry. Other drivers include: reducing tax evasion, fraud, money laundering, anti-terrorism, as well as impact on PII (Personally Identifiable Information) data vs. the right to be forgotten and GDPR.
  • Security – Also, many security concerns persist, particularly in light of regular headlines about hacking, outright theft and other malfeasance. Increased Cryptojacking, i.e. the practice of stealing other people’s device processing power to mine cryptocurrency, is also a concern.
  • Scalability and fragmentation – it takes significant computing effort to mine Bitcoins, or to verify transactions, which has long raised concerns over its long term performance and scalability. The resulting splits or ‘ forks’ in that cryptocurrency have provided a vast array of competing coins (e.g.: Bitcoin! / Bitcoin XT / Bitcoin Unlimited / Bitcoin Cash / Segwit / Bitcoin Gold). Furthermore, there are myriad cryptocurrency wallets and exchanges to chose from, which can be rather daunting. Also the aforementioned next generation networks which use: Directed Acyclic Graphs (DAG) / voting algorithms / gossip protocols to deliver more flexibility, scale and performance.
  • Energy Consumption – Furthermore, the high cost of energy required to mine proof-of-work cryptocurrencies is another growing area of concern as it contributes to the spectre of global warming.
  • Privacy – Finally, the early association of Bitcoin with illicit and subversive activities on darknet sites (such as the defunct Silk Road and Alphabay) hasn’t really gone away, especially with the rise of privacy focused cryptocurrencies such as: Monero, Dash, zCash, Verge and DeepOnion. Contrary to popular belief, Bitcoin itself does not guarantee privacy because transactions can be linked to individuals (albeit with some effort), and all Bitcoin transactions are recorded for posterity on a very public Blockchain.

 

In light of the above opportunities and challenges, it is plain to see that the Blockchain technology is just at the starting line on a lengthy course of disruption and upheavals as yet unimagined. However, in the third and final part of this blogpost series, we’ll take a look at key scenarios and likely outcomes and conclusions after the storm has passed and dust settled.

 

Governing the Internet of Things.

February 28, 2015 Leave a comment
In light of increasing coverage about the so called “Internet of Things” (IoT), it is not surprising that sovereign governments are paying attention and introducing initiatives to try understand and take advantage of / benefit from the immense promise of the IoT. Despite the hype, it is probably too early to worry about how to govern such a potential game changer, or is it?


According to Gartner’s Hype Cycle for Emerging Technologies, the Internet of Things is hovering at the peak of inflated expectations, with a horizon of some 5 – 10 years before reaching the “plateau of productivity” as an established technology, so still fairly early days as yet, it would seem. However, that is not sufficient reason to avoid discussing governance options and implications for what is arguably the most significant technology development since the dawn of the Internet itself. To this end, I attended a recent keynote seminar on policy and technology priorities for IoT (see agenda here), and below are some of the key points I took away from the event:


1. No trillion IoT devices anytime soon –  According to Ovum’s Chief Analyst the popular vision of ‘a Trillion IoT devices’ will not appear overnight, for the simple reason that it is difficult, and will take some time, to deploy all those devices in all manner of places that they need to be.


2. What data avalanche? – Although a lot of data will be generated by the IoT, it shouldn’t come as a surprise that the proportion of meaningful information will depend on the cost to generate, store and extract useful information from the petabytes of noise – there is a lot of scope for data compression. For example, the vast majority of data from say environment sensing IoT devices will likely be highly repetitive and suitable for optimisation.


3. Regulatory implications – OFCOM, the UK’s Data regulator, identified the four themes as most relevant for the future development of  IoT, i.e.: 1. Data privacy (including authorisation schemes); 2. Network security & resilience (suitable for low end devices); 3. Spectrum (e.g. opening up 700Mhz band and other high / low frequency bands for IoT); and 4. Numbering & Addressing (need to ensure there is enough numbers & addresses in the future for IoT).


4. Standards and interoperability – these remain key to a workable, global Internet of Everything (IoE) particularly because of need for data availability, interoperability (at device and data level), and support for dynamic networks and business models.


5. Legal implications – again the key concern is data privacy. According to Philip James (Law Firm Partner at Sheridans), in describing the chatter between IoT devices: “hyper-connected collection and usage of data is a bit like passive smoking – not everyone is aware of it”.


In context of the above observations, it may be easy to ignore the elephant in the room, i.e. how to manage unintended consequences from something as intangible as the future promise of IoT? What will happen if and when the IoT becomes semi-autonomous and self reliant, or is that science fiction?


Well, I wouldn’t be so sure, because it all boils down to trust: trust between devices; trust in data integrity; and trust in underlying networks and connectivity. However, this is not something the Internet of today can provide easily, therefore some interesting ideas have started percolating around scalable trust and integrity. For example, Gurvinder Ahluwalia (IBM’s CTO for IoT and Cloud Computing) described a scenario using hitherto disruptive and notorious technologies (i.e. Blockchain and BitTorrent, of Bitcoin and Pirate Bay fame respectively), to create a self trusting environment for what he calls “democratic devices”.


The implications are astounding and much closer to the science fiction I mentioned previously. However, it is real enough when you consider that it requires a scalable, trustworthy, distributed system to verify, coordinate, and share access to the ‘Things’ on the IoT, and that key components and prototypes of such a system already exist today. This, in my opinion, is why sovereign governments are sitting up and taking notice, as should all private individuals around the world.


Free, your new IP strategy: is this the future of Intellectual Property and Innovation?

June 26, 2014 1 comment

I came across a blog post about electric automaker Tesla’s recent move to open up its patents by making them free to use by anyone, including competitors. According to founder, Elon Musk, “Technology leadership is not defined by patents, but rather by the ability of a company to attract and motivate the world’s most talented engineers.”

Tesla-specs

I believe that while this move may have multiple strategic intent, (i.e. Tesla could have other IP cards up their sleeve), it also highlights limitations in the current systems of Intellectual Property, and it’ll require a fundamental shift in philosophy to fully appreciate where such trends could take us.

Obviously, I admire Tesla’s creativity and innovation, not least because their eco-friendly cars do not remind me quite so much of badly constipated turtles, but because their sheer guts and willingness to take risks (aka multiple leaps of faith) puts them ahead of the curve.

If technology leadership is no longer defined by a sizeable IP portfolio, then this presents some very real challenges to various foul strategies and current sharp practices for IP, such as: “weaponised IP”, Patent Trolls, industrial espionage, and so forth. According to author Don Peppers’ blog post on the topic, such “open source” and “free revealing” (aka free sharing) of otherwise competitive IP assets actually drive innovation “while patents, copyrights and other legal mechanisms seem to be holding us back.”  He goes on to say: “This is big, everyone. If you don’t know how big this is, you haven’t been paying attention.”

In my opinion, a mindset of “share first then ask questions after” is vastly superior to the usual scarcity based approach to wealth creation, (i.e. “mine, mine, all mine” is not real wealth, just an illusion). True wealth, which is firmly based in abundance, actually favours the sharing mindset by motivating and empowering bright creative people to continue to do and share what they do best. Such a system fosters innovation, and is ultimately self replenishing, because it forces organisations to ensure they maintain the right ingredients to continue being innovative.

In such a world, an organisation may be deemed a failure when it no longer has the ability to innovate, regardless of the size of its bank balance, market capitalisation or IP portfolio. Instead, successful organisations will be ones which can establish and demonstrate a self-perpetuating culture for creativity and innovation. Such bold claims do however raise some serious questions over IP, e.g.:

  • Should IP be granted with implicit right for others to use and reuse by default, (along with fair recompense or royalty to the owner)?  And if this were feasible, would everyone play by the rules?
  • Are we likely to see a situation whereby IP may be rescinded from organisations that do not actively use them to innovate? I can already imagine Patent Trolls, and their IP lawyers, screaming in anguish at the thought.
  • If free sharing of IP became common practice, will it ultimately diminish the value of IP, and its raison d’etre, (i.e. a means to provide direct economic reward for creators and owners of IP)?  Bear in mind that creators and owners of IP are not always one and the same.

These and other similar questions easily rise to the fore when you extrapolate the developing trend for free IP sharing and their implication for both individuals and organisations. The preceding points / questions are not solely relevant to organisations. Individuals, particularly those in the creative arts (e.g. authors, musicians and other artistes), are also affected especially as they increasingly chose to explore alternative funding models to finance their works.

TV presenter and author, Kate Russell (of BBC Click fame) takes it a step further by advocating the creation of new IP models based on crowd funding in her recent BCS blog post. Her exact words were: “With the online world still in freefall about how to solve digital rights protection and make sure artists get paid fairly for creative works, I genuinely believe that crowd funding could form the groundwork of a new intellectual property model”. In my opinion, this is another example of the shifting mindset that will ultimately bring about the evolution of a more suitable IP system for the digital world of today and tomorrow.

The Architect and Digital

March 15, 2014 Leave a comment

I was very fortunate to participate in Capgemini’s recent Business Priority Week (BPW), alongside over 300 attendees from 22 countries, at the beautiful Les Fontaines retreat. The focus of the week was a new global service line called Digital Customer Experience (DCX), and we (from various business units, disciplines and competencies) were set a challenge to explore and articulate how we’ll work together to deliver this promise for clients.

Digital Customer Experience

The Digital Customer Experience

Being the clever people that architects are sometimes rumoured to be, the immediate response is directly related their role in a rapidly accelerating digital world. However, as an architect, I fear our time may be coming to an end unless we embrace the need to evolve the practice of architecture into something that clearly defines, assures and guides the digital customer experience for our organisation and our clients (incl. their customers / end-users). In order to do this properly, we must undertake an architectural journey to understand the context and key issues before deciding on the most appropriate response. Key questions to ask and answer include:

1. What is Digital and why is it such a game changer for our clients and our business?
A great story about rice, chess and an emperor was used to illustrate the impact of Moore’s Law to startling effect by revealing that we are only at the beginning of the digital journey, or as the authors of Race Against the Machine would say, “we ain’t seen nothing yet”.

2. Are established architecture approaches still relevant for digital?
The experience gained from several decades of putting together complex computer based systems was not lightly earned, and it would be spectacularly foolish to suggest that this is no longer required in the age of digital. If ever there was a time for true architecture it is right now, at the start of such an epic journey, however this implies a shift in the way architects engage clients and practice architecture.

3. So what is different about architecture for Digital and why is this important?
In a short answer – it needs a renewed focus on the business model. The role of architecture in digital is about getting closer to the business and helping achieve desired outcomes, (so far so normal), but this must be done at the exponential pace of digital, whilst maintaining ROI from existing technology investments. It is akin to walking atop the wall of a castle whilst juggling live cats and canaries, during an earthquake, and ducking missiles from inside and outside the castle. I’m sure you get the picture.

The above points indicate a necessary shift in mindset to handle the relative extremes in velocities at the interface of Digital vs. traditional IT systems. Among other things, the digital architect should:

  • Provide enterprise technology governance framework as a key point of reference for the various agile projects and initiatives commonly found in the would-be digital enterprise.
  • Utilise business modelling techniques (e.g. the business model canvas) along with time and velocity sensitive architecture principles to provide critical governance and to guide solutions from design right through to implementation, and beyond.
  • Be mindful of legal and ethical issues that can arise in the digital space (e.g. contractual obligations for digital services, and / or the privacy concerns of end-users).
  • Anticipate the needs of clients and their business in a fast changing environment, even when some stakeholders might challenge the need for architecture in any form.

In conclusion, it is my opinion that architecture has never been more critical than at this particular point in time. This therefore is a call to action for every organisation to challenge their architects to provide the governance and assurance needed to achieve the outstanding outcomes promised by Digital Customer Experience, whilst also protecting existing investment and core assets.

How to implement innovative business models

August 9, 2013 2 comments

Back in 2011, I wrote a post about business model innovation in which I waxed lyrical about how a simple, straightforward business model canvas could be the perfect tool for any organisation to use in tackling the complexities of today’s business environment. So what has changed since then?

Absolutely nothing, and I still stand by what I said. If anything, ample proof exists in the growing number of user communities and tools (e.g. here and here) that employ this amazing technique to simplify and facilitate business model innovations. However, the one missing piece for me was how to easily translate valuable insights gleaned from using the business model canvas into something tangible, practical and immediately applicable to the actual work of business transformation. That problem appears to have been solved with the introduction of tools that can automate and facilitate the execution part of business model innovation.

Image

Figure – The missing piece: executing business model innovation 

Don’t get me wrong, the above missing piece is achievable by manually translating business model changes into the enterprise architecture (EA) and business process (BPM) landscape, but this implies hefty overheads in terms of people and effort required to implement even a simple change. Also, the evolving nature of the role played by EA and BPM functions, (within a dynamic and fast changing business environment), demands a more seamless interface with changing business models. Thankfully, the afore-mentioned tools should help to automate and provide such seamless linkage.

A couple of weeks ago, I attended a vendor webinar which actually prompted this blog post, because they described how their software suite was designed to deliver this capability, and below are some of my impressions from that event, including:

  1. The promise of business model canvas as the right approach to address the challenge of a Volatile, Uncertain, Complex and Ambiguous (aka VUCA) world.
  2. The shift away from products to business models as key differentiators
  3. Seven applications of the Business Model Canvas, including various business model innovation journeys and perspectives (e.g. offer / customer / revenue driven models)
  4. Business Model Mountain was the term used to describe how business model innovation falls over halfway between ideation and execution, (see diagram below).

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Figure – Business Model Mountain (source: BizzDesign Webinar Slides)

According to the presenter, their software suite provide a more compelling way to engage business stakeholders with the end-to-end transformation process, by using business model canvas as the reference model for communication between business, process and technology stakeholders. It was also great to see a demo of the software suite, which allayed some of my fears about tools that attempt to do too much, by featuring different aspects (i.e. business model canvas, EA and BPM) as distinct tools that work well in their own right, but which can be combined to deliver end-to-end translation of the business model into real system components and processes.

Health Warning: Not having used this tool yet, (due to very busy day job, believe it or not), I’m unable to say more about real hands-on capabilities, but in terms of its potential to help realise the huge promise and benefits of business model innovation, this is certainly a step in the right direction, in my humble opinion.

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Note: this is another post in the innovation topic series, and more specifically, “tools for innovation”. Watch out for more on this and related topics, over the next few months.

Some relevant links:

  1. Blogpost: “The Innovative Art of Business Model Generation” – https://www.capgemini.com/blog/capping-it-off/2011/07/the-innovative-art-of-business-model-generation
  2. BizzDesign Webinar: “Business Model Innovation Webinar” – http://www.bizzdesign.com/blog/serviceline/business-model-management
  3. Bright talk Webinar: “Innovation and EA”-  https://www.brighttalk.com/webcast/679/32551
  4. Blogpost: “Developing a tradition for change” – http://www.bcs.org/content/conBlogPost/2204
  5. Blogpost: “Capabilities for Sustainable Innovation” – https://www.capgemini.com/blog/capping-it-off/2013/08/capabilities-for-sustainable-innovation

Creating an ecosystem for entrepreneurs, innovators and investors

June 13, 2013 Leave a comment

Creating an ecosystem for entrepreneurs, innovators and investors

What do you get when you gather some entrepreneurs, serious investors, and innovators together at a jam-packed, invitation-only, event on entrepreneurship? Read on to find out…

Follow The Entrepreneur

Follow The Entrepreneur Summit 2013

I attended the third annual Follow the Entrepreneur Investor Summit, and wasn’t disappointed by the impressive speakers, entrepreneurs and location. The event focused on: “The New Common Sense” (why society needs to organise around the entrepreneur), and “The New Future” (how entrepreneurs are transforming the future of business). Among the superb array of speakers and topics, a few highlights include:

Former defence secretary, Dr Liam Fox MP, delivered a key note calling for the UK to focus more on growing the economy by encouraging entrepreneurship.

Dell’s entrepreneur in resident, Ingrid Vanderveldt, descibed how corporates can get into the action by providing the facility to connect startups with resources (e.g. Dell’s Entrepreneur Centre), and she wondered why more corporates were not already doing this.

Mark Hoffman, ceo of Oxygen Finance group, and founder of Sybase and Commerce One, explained how to make money from account payables, via an innovative new service

Panelist, Geoff Knott, recalled how social innovation and reform has always had the biggest impact on society, and called for entrepreneurs to “think broader than just business”.

Panelist, Frank Meehan, described how a 16 year old created a news summarisation service, and  secured investment from Li-Kashing’s Horizons Venture. The service is set to be acquired by Yahoo!

Matternet Drones

Matternet Drones

Panellist, Andreas Raptopoulos presented a bold vision for radical transformation of the transport and logistics industry with Matternet, an AI enabled network of drones and ground stations that can be used to deliver medicine and other lightweight goods in remote or road challenged locations around the world. I said it was a bold vision.

Mary Turner, serial entrepreneur and former CEO of Tiscali UK, described a service that senses and alerts users to events at home. The sensing network being a key component of the intelligent home and the Internet of Things.

This event was full of entrepreneurs with fascinating ideas in different stages of maturity, and it felt very much like an innovations parade; one idea even better than the next. For example, I ran into the founder of Scoopshot, (a service providing crowd-sourced visual content – i.e. images and footage for breaking news); then heard from the founders of Quill (a service for bespoke, branded content, articles which has since raised £1M from Ariadne & partners), and Taggstar (a data rich, content tagging service that enables shopping, sharing, viewing and targeting). When combined with investors and established legal / media industry representatives, one could easily see the future of transmedia content publishing and usage business models all present together in the one room. The same could be said for any other industry e.g. health, defence, logistics or manufacturing you care to name.

In conclusion, I believe it is this sort of occasion and environment (with the right mix of investors, innovators and entrepreneurs) that some key connections and relationships are sparked off, which ultimately go on to impact the world.

Five Myths of Digital Technology and Enterprise Transformation

January 29, 2013 Leave a comment

Digital technology has brought unprecedented change across all business sectors, and very few organisations can claim to be unaffected by the information age (e.g. via internet, mobile, social channels). However, this does not always translate to a need for that cause-all / cure-all catchphrase of technology or digital transformation.

Below are five commonly held myths associated with digital technology and enterprise transformation:

1 – Technology really drives the business

Only if your business is about creating and / or selling new technology, otherwise this is tantamount to placing the cart before the horse, or the tail wagging the dog – it may be possible, but not necessarily a good idea. The fact is that technology places way down the list of drivers for business change. Gartner’s Nexus of Forces which combine to impact businesses, although enabled by technology, relate mainly to changing paradigms (i.e. big data / cloud) and behaviours (i.e. social / mobility) rather than just pure technology

2 – Change technology; change your business

No, not really. Technology change is not the same thing as technology enabled change. The former relates to tools, whereas the latter is about the purpose for which said tools are used or acquired. For example, buying and using Salesforce will not automatically make yours a more customer centric organisation. Digital technology transformation is less about technology than the outcome of an architected approach to delivering fast, flexible and responsive services to customers

3 – Transform now or die!

Not all businesses will need to undergo an immediate or full blown technology change programme, as sometimes the only change required may just be around processes or service focus. A change in culture could have more significant and lasting impact in some organisations. For example, shifting from a reactive customer support environment towards proactive customer engagement will yield better results even if the tools remain the same!

4 – You need a team of tech-savvy whiz kids to transform your business

False. Most of the advantages of new digital technologies come from ability to provide fast and flexible services connected / delivered through standardised interfaces, which don’t require expert knowledge of the source system. The role of IT is fast evolving into an orchestrator and governor of the various external / internal services (including legacy systems / applications) that must work together to deliver said fast, flexible and responsive services to the internal / external customer

5 – The need for digital transformation will one day come to an end

No, no, no. There can be no real end to continuous digital evolution, especially when the rate of change is actually on the increase, no doubt spurred on by knock-on effects of fast changing technologies, user behaviours, customer expectations and competition. The ideal business lifecycle must embrace a process of continuous improvement with allowance for testing new business models, implementing changes (including technology related ones), evaluating the outcome, making further tweaks, and repeating the entire process all over. This cannot stop because as soon as an optimal solution is achieved the business environment changes again, thus necessitating another cycle

In summary, and perhaps somewhat ironically, digital technology is neither the root cause nor cure-all for many challenges facing organisations today. The need for transformation is often triggered by changing environments and / or behaviours (e.g. by customers, suppliers, partners or competitors), perhaps in combination with some innovation (technology based or otherwise), that ultimately impacts their bottom line.

Perhaps fittingly the real business impact of technology transformation comes from how it is deployed and used by the people within and outside the organisation. Each organisation must make the effort to understand its own particular situation, and to discover the right way forward. It is not an easy task, but with the right attitude and motivation from the top, it will be relatively less painful than just doing nothing.