F. Digital strategy Flashcards
what is disruptive technology?
instances where technology is used to fundamentally change and ‘disrupt’ the existing business model in an industry
transport: Uber taking on traditional taxi firms
accommodation: Airbnb
retail: Amazon, Alibaba
advertising: Facebook and Google
what are the two largest growth sectors for disruptive technology?
health services
financial services - Fintech, GS estimates that upstarts could steal up to $4.7trillion in annual revenue, and $470 billion in profit from established financial services companies
what is Zopa?
Fintexh loan company
links lenders and borrowers, without bank margins so lower fees
no physical branches so less overheads and operating costs
loans are unsecured but credit scores are available to lenders so that they can match lending rates to different credit scores
lenders can sell their loan if they want to cash in early
What is Betterment?
financial portfolio management platform
take away from financial advisors
use smartphone to get investment advice
what is a ‘born digital’ organisation?
founded recently with digital tech at forefront e.g. Uber, Deliveroo
what are the advantages fo Fintech?
- better use of data
- a frictionless customer experience using elements such as smartphone apps to provide a broad and efficient range of services
- more personalisation of products/services to individual customers
- lack of a physical presence
- access to cheap capital to fund growth
According to Accenture’s Technology Vision, how can management ensure that organisations survive digital disruption?
Internet of Me - users being places at the centre of digital experiences
Outcome economy - customers want outcomes rather than just products
the Platform (r)evolution - global platforms through cloud computing, mobile technology
the intelligent enterprise - use of data in a smart way
Workforce reimagined - people being used in a different way
what are the myths about digital transformation?
those organisations that are not digital already have missed their change
becoming a digital business is an administrative exercise that focuses on achieving operational efficiencies
digital transformation can be successfully achieved just by creating a digital business unit headed up by Chief Digital Officer
-needs to be top down and everyone buy in
what is AI?
an area of computer science that emphasises the creation of intelligent machines to work and react like human beings
designed for use in:
- voice recognition
- planning
- learning
- problem solving
what is machine learning?
developed through algorithms to detect patterns and learn how to make predictions from very large data sets
adapt to new data and experiences to improve their function over time
what are the 3 major types of machine learning?
supervised - human label input data and the algorithm finds the connection between input and output
unsupervised - the algorithm receives unlabelled data and infers relationship between input and output
reinforcement - the algorithm learns to perform a task by maximising rewards earned from actions it takes, ideal when there isnt alot of training data available
what are the 3 steps to how supervised learning works?
- a human labels every element of the input data and defines the output variable
- the algorithm is trained on the data to find the connection between the input variable and the output
- once training is complete- typically when the algorithm is sufficiently accurate in providing output data from input- then the algorithm is applied to new data
what are the 3 steps to using unsupervised learning?
- the algorithm receives unlabelled data: for example, a set of data describing customer journeys on a website
- the algorithm then infers some sort of structure on the data
- the algorithm identifies groups of data that exhibit similar behaviour e.g. clusters of customers of similar age that exhibit similar buying patterns
what are the 3 steps to using reinforcement learning?
- algorithm takes an action on the environment e.g. ti makes a trade in a financial portfolio
- it receives a reward if the action taken brings the machine a step closer to its objective e.g. return on investment chosen
- the algorithm optimises for the best series of actions by correcting itself over time e.g. if losses made, will do better next time
what is AlphaGo?
reinforcement learning helped the AI system AlphaGo defeat the world champion Ke Jie in the Ancient Chinese board game of Go
-played with human beings instead of online
How did JLR use intelligent vehicles?
introduced self-learning vehicles into its range of vehicles
system within the vehicle integrates with different passengers’ mobile devices and learns to recognise their individual behaviour and preferences
can then apply such understanding to adapt issues such as conform controls within the vehicle and the entertainment choices that are offered
How can AI contribute to improving finance and systems?
- ML to code accounting entries and improve on the accuracy of rules based approaches, enabling greater automation of processes
- improving fraud detection through more sophisticated, ML models of ‘normal’ activities and better prediction of fraudulent activities
- using ML-based predictive models to forecast revenues
- improving access to, and analysis of, unstructured data such as contracts and emails
what is cloud/mobile computing?
computing based on the internet
providers maintain software, applications, servers and services on the internet and make them available to authorised users
what are the benefits of cloud computing?
- store and share data
- on-demand self-service: users gain access as and when needed
- flexibility for users
- easier collaboration between users
- more competitive
- easier scaling
- reduced maintenance
- backups
- disaster recovery : faster and cheaper
- better security e.g. loss of hardware avoided
what are the risks of cloud/mobile computing?
- reliance on service provider e.g. security, keeping tech up to date, staying solvent
- regulatory risks: service provider must ensure compliance with data protection. Provider may be in different jurisdiction
- unauthorised access of business and customer data: possible hacking of service provider will impact all users. Also misuse by service provider staff
what are the cloud computing applications to finance
used in budgeting process
budget templates worked on simultaneously by many people without them having to be at the same location
what is IoT?
inter-connection via the internet of computing devices embedded in everyday objects, enabling them to send and receive data
according to DTI, 8bill devices globally, forecast to grow to 1T by 2030
What are intelligent refridgerators?
alert user for sell-by date of ingredients to reduce food waste
can identify when stock is about to run out
add milk to next order from supermarket automatically
what are the benefits of blackboxes?
work out cheaper for good drivers
give motor insurance companies more data
leads to more careful driving
what are smart meters?
heaters that turn on and off or reduce and increase according to demands
can be controlled from smartphone
overall energy consumption reduced
How can dairy farming use IoT?
trial smart collars attached to a herd
feeds back info to the farmer’s computer about the cow’s behaviour
2 issues affect cow’s profitability:
- illness costs industry around £100m
- cow’s ability to conceive
abnormal behaviour could then in turn lead to action being taken by farmer
How does UPS use IoT?
fitted fleet vehicles in the US with smart devices that tracked fuel consumption
identified that making left turns at traffic lights lead to increased amounts of idle time and therefore longer journey durations and fuel consumption
re-routed deliveries so as to avoid unnecessary left turns
saves 9m gallons of fuel and $31m
How does Vitality use IoT?
introduced a scheme where policyholders who took out health insurance with the company were given an Apple watch and had to download Vitality app
watch was ‘free’ provided they met the exercise target in a specified time
if target not reached, a contribution would be paid via direct debit to the insurance company
benefits:
- gave Vitality marketing edge in the insurance market
- increased number of members
- forced users to exercise thereby staying healthier and reducing the amount of health insurance claims
What is Big Data?
term for a collection of data which is so large that it becomes difficult to store and process using traditional databases and data processing applications
90% of the information in the world has been created in the last few years
what are examples of inputs that Big Data systems can include?
- social network traffic
- web server logs
- traffic flow information
- satellite imagery
- streamed audio content
- banking transactions
- web page histories and content
- government documentation
- GPS tracking
- telemetry from vehicle
- financial market data
What can the data from the Hybrid Fusion model, which generated 25GB of data per hour, be used for?
- computer model developed that projects CO2 emissions generated by the fleet of vehicles on roads worldwide for the next 50 years, helps balance fuel economy requirements and environmental considerations
- mathematical models have analysed millions of possible vehicle combinations to assist in the construction of a technology roadmap which has resulted in the development of new features such as Ford Auto Start-Stop
- Ford researchers have developed specific tools such as the Ford Fleet Purchase Planner, which analyses fleet customers’ needs and identifies their optimal vehicle choice
what are the features of Big Data?
volume - amount
velocity - speed and update
variety - structures and unstructured
veracity - reliability and accuracy
