Modernization: Architecting the Future of Your Business
September 27 | London
The Bloomberg Modernization Roadshow began in London on September 27, where business and technology executives gathered to discuss the strides companies have made in modernizing technology without hampering innovation, creativity or security.
They shared their outlooks on emerging technologies, the importance of creating ecosystems that work well together and insights into ESG strategies.
- Callum Mitchell, Senior Business Development Executive, Hybrid Cloud & AI, IBM
- Prakash Pattni, Managing Director, Digital Transformation, Cloud for Financial Services, IBM
- Nikkie Spencer, Director of Cloud and Service Delivery, Metro Bank
- Leon Molchanovsky, Enterprise Security Architecture, BP
- Josie Smith, Chief Architect, BT Digital
- Yiting Shen, Global Head of External Network Management, TTS, Citi
- James Maudslay, Global Digital Lead for Insurance, Equinix
- Navin Rauniar, Partner, Sustainability, ESG & Climate, Tata
- Bruno Corasolla, Head of Digital Trains, Hitachi Rail Limited
- Justin Arbuckle, Global Chief Technology Officer, Wealth & Personal Banking Technology, HSBC
- Amitabh Apte, Vice President, Global Chief Information Officer, Pet Nutrition Business, Mars Inc.
- Ron Argent, Founder & CEO, Cognition Foundry; CEO, TES Enterprise Solutions
- Janet Wu, Anchor & Reporter, Bloomberg
- Tamlin Bason, Analyst, Bloomberg Intelligence
Bruno Corasolla, Head of Digital Trains, Hitachi Rail Limited, explained the challenges train operators face in delivering on-budget services while dealing with constantly changing operating costs.
Their goal: to embed technology that connect to a larger environment, resulting in lower operating costs and better service. Before that can happen, Corasella argued, governments need to create an ecosystem that integrates different forms of travel.
Customers who use public transport every day want a seamless experience where they know the exact duration and cost of a journey at a moment’s notice, he said. To achieve this trains will be streamlined with other forms of transport in the transportation environment.
“Our business isn’t in the cloud, our business is in assembling and building trains,” Corasella said. “But the value we’re embedding in our product needs to deliver this so we need to rely on partners that will help us deliver this.”
Janet Wu, Anchor & Reporter, Bloomberg, stressed the need for innovation in the American rail system in order to create demand. Navin Rauniar, Partner, Sustainability, ESG & Climate, Tata, said he believes the vested interest of transportation competitors has hurt rail development. “It’s big business and it’s very concerning.”
Prakash Pattni, Managing Director, Digital Transformation, Cloud for Financial Services, IBM, took the conversation towards creating ecosystems that “help you solve end-to-end problems.”
Leon Molchanovsky, Enterprise Security Architecture, BP, brought up the challenge of motivating different stakeholders to work together. “Only one in seven interconnected systems succeed,” Molchanovsky said. “All the others fail in the first five years because they can’t agree with the strategic decision or the way the strategies should be implemented.”
Amitabh Apte, Vice President, Global Chief Information Officer, Pet Nutrition Business, Mars Inc., explained that during the past ten years, Mars has been shifting away from the chocolate business to pet food. Mars is now one of the biggest recruiters of vets and is acquiring vets and personal clinics so that services can be integrated into their businesses. “If you own the whole ecosystem it’s better,” he said. “Sharing the same vision is a great challenge.”
Josie Smith, Chief Architect, BT Digital, noted that integrated systems are expensive and that one system isn’t always better. Justin Arbuckle, Global Chief Technology Officer, Wealth & Personal Banking Technology, HSBC, agreed that such ecosystems have become a buzzword but that integrated strategies are key to making them work.
The future of ecosystems
Navin Rauniar noted that merger activity can slow integration. Justin Arbuckle agreed and said that creating clear priorities is a key. He said while new features under development might seem “cool,” what makes a banking app successful is systems that are reliable and safe.
Josie Smith observed that demographics determine customer requirements. For example, older customers may only need a phone that can call 999 while younger people want the ability to game and go online. It’s important, she said, to cater to both.
Nikkie Spencer, Director of Cloud and Service Delivery, Metro Bank, explained that while other banks are closing their branches Metro has been continuing to open new stores. She emphasized that in-person interaction is still valued and that visitors to her bank are not limited to one age or gender demographic. James Maudslay, Global Digital Lead for Insurance, Equinix, agreed that consumers want stores on the ground and that online banks need to be interconnected with a physical presence.
Navin Rauniar noted that American banking practices lag those in the UK and Europe. The group strongly agreed and said the problem goes beyond banking to areas like health care and public transport.
Prakash Pattni brought up the importance of consumer trust, stressing how easy it is to lose. This led to a discussion of how technologies such as Twitter have created environments that make it easy for a company’s reputation to be damaged online. Bruno Corasolla noted that social media can be an important business strategy. He detailed an instance in which Hitachi found out about a train defect five minutes after it happened by monitoring social media. Janet Wu said she believes “every corporation now needs to have a team looking at social media because it’s just too instant and too easy [for your reputation to be damaged.” Nikkie Spencer added that “If we have operational issues we are always monitoring Twitter.”
Justin Arbuckle, emphasized that although Tesla is often seen as a car company, it has actually created a battery ecosystem. Ron Argent, Founder & CEO, Cognition Foundry; CEO, TES Enterprise Solutions, said that while battery-powered cars are labeled green, they are not actually a sustainable alternative. People underestimate the amount of energy it takes to extract the materials needed to create these cars and how much energy it costs to recycle the products afterward, Argent said.
The importance of energy security
As the discussion moved towards energy supply, the question was raised as to where future energy production will happen and whether global conditions mean there will be a move away from ESG. Navin Rauniar said he believes that while governments should focus on ESG, it needs to be balanced with other important factors like energy security.
The talk then moved to the metrics around ESG and the problems that arise because of a lack of transparency about what the term actually means. While greenwashing is not uncommon, James Maudslay, Global Digital Lead for Insurance, Equinix, said he believes these companies would eventually be found out and publicly exposed. Ron Argent argued that exposing companies brings its own level of risk because once accusations of greenwashing are made, it may prevent companies from taking environmental actions.
This brought up the issue of how companies measure their carbon emissions and Navin Rauniar expressed his belief that companies are engaged in tech modernization without addressing these issues. Tamlin Bason, Analyst, Bloomberg Intelligence agreed that the metrics haven’t caught up, but that backlash against greenwashing and ESG is nothing new.
Again the conversation returned to the importance of focusing on a range of goals other than solely our environmental concerns. “We have to grow the economy in India, say we are doing coal, oil, it’s carbon-intensive but what else are we doing? We are building townships, we are building the infrastructure, public services, hospitals, and schools, we’re taking over the responsibility of governments, we are a government in ourselves,” said Navin Rauniar about India. “There’s a lot of good that’s coming out of what we’re doing we’re creating jobs, you can’t just close down fossil fuels overnight.”
Participants asked whether future investors will make purchasing decisions based on the ESG, though nearly everyone agreed that they already do. Leon Molchanovsky pointed out that ESG companies have a premium of 15 percent to 20 percent, and Janet Wu said that investors in any demographic are willing to pay more for ESG-oriented stocks.
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