Digital Transformation - Cisco's Journey
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Cisco's Vice President of IT, Sesh Tirumala, explores the landscape of Digital Transformation and goes over why Cisco chose to embrace it.
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Digital Transformation - Cisco's Journey
- 1. Sesh Tirumala Vice President, IT April 13th 2017 Cisco’s Journey Digital Transformation
- 2. Agenda Cisco Landscape Why the Move to Digitization? Digitization Use Cases Q&A
- 3. Cisco Landscape Setting the Context
- 4. Cisco Snapshot 192 Acquisitions since 1993 19,000+ Patents $48.7B Revenue #1 or #2 in most market segments 70,000+ Employees $71.8B Total Cash 60,000+ Channel Partners 16,000 Engineers $37.2B Product Revenue 380 global sites in 165+ countries $11.9B Services Revenue 32 Years Old
- 5. Evolution of the Network Security IoT and Applications Next-Gen Data Center, Cloud & Analytics Service Provider Cisco’s Key Focus Areas
- 6. 97 Countries 570 Offices 141,766 Connected Stakeholders 6,769 LAN Switches 12,013 UCS Blades 29.4MW Data Center Capacity 89PB Overall Usable Storage 46,903 Production Virtual Machines 154 Services 203,702 Connected Devices 4,379 Routers DNS 5.8B DNS Records/day 71,539 Employees Cisco at a Glance
- 7. Territory Manager Billing and Revenue Management Product LifeCycle Analytics Enterprise Inventory & Service Level Optimization Service Contracts and Install Base Management Fulfillment Experience Fulfill to Activate Invoice to Cash Service & Consumption Experience Monitor to Usage IB / Contract Mgmt Issue to Resolution Acquisitions Data & Analytics Knowledge Management Customer Success Management Common Technologies Market to Demand Lead to Opportunity Quote to Order Selling & Buying Experience Cisco Technology Landscape Business Process Category (Outside-In View)
- 8. Simplification: Business Services Architecture Change Management Define / Measure Success Services Taxonomy Organizing principle Services Roles Responsibility and accountability Services P&L (Cost and Value) Cost Bill of IT to deliver a capability Value Client view of capability Business Partnership Business Partnership / Aggregate Value of IT Services Services Funding Budget Strategic Investment Planning Organizational Health Architectural Reviews Services Review
- 9. Guillermo Diaz Chief Information Officer Rebecca Jacoby Chief Operations Officer Kevin Bandy Chief Digital Officer
- 10. Why the Move to Digitization?
- 11. Our Digital Transformation Value Reimagined | Work Reimagined New Customer Experience New Business Models Security Everywhere
- 12. CDaaS - Innovation Digitizing Planning to Release Process | Continuous Delivery Toolchain | 80% Agile – 20% Waterfall Policy Cisco Virtualization Cisco Tetration Policy DaaS - Insights Analytics | Visualization | Virtualization | Data Catalog of Services | Role Based Access 4 Policy PaaS - Agility Orchestration Foundation | Automation | Open and API Driven | Removed 83% Cost Structure 3 Cisco UCS Cisco Security Cisco UC&V Cisco Network Storage ACI IaaS - Simplicity Catalyst of Service Architecture | Simplified Infrastructure Provisioning | Programmable & Policy Based 2 5 Policy APPaaS – Outcome Focus Mobile | Web | Machine | Cloud Native | Contextual Collaboration Cloud Native IOE/Policy SaaS ERP Value Exchange1 Cisco NSO Cisco Network Cisco Network Cisco Network Spark
- 13. TRANSFORM Everything We Do Simplification Automation Security Analytics Continuous Innovation 5 DIGITAL PRINCIPLES
- 15. Digitizing Renewals – How it’s Done Qualified Opportunities Management Pre-Quoting & Deal Approval Quoting & Ordering Collaborate Reconcile Assets and Entitlements Price Modeling (what if scenarios) Historic deals approved and the view to that Analytics to support… Cisco Impact (Partner integration) i Opportunity Qualification Upgrade and downgrade Knowyour Customer Actionable Opportunity Asset Information Digital Seller View Deal seamless routing Improved Validations Simple Q2O process Deal Approval Rules Optimization Proactive management and maintenance of customer/partner entitlement access Self-Service Contract Management Auto entitle based on business rules Smart Account Management Opportunity business rules Cross sell upsell view Historic Purchase View Contact Information Accurate Tagging for Renewals and Follow on Std & Non-Std Billing based on Customer’s Invoicing Requirements Optimized revenue allocation/compensation for renewals and follow-on Invoicing and Billing Options Partner Metrics Partner Feedback Goal Setting Sales Comp Entitlement & Contract Management Billing & Invoicing Sales Comp & Partner Rebate QualifiedRenewals Opportunities IB/SA Data Foundation Customer Registry Licensing Support Sales Coverage Partner Data Portfolio/ Config Collector Minimum Duration Renewal Quote Protection Multiple End Users Takeovers Periodic Billing Schedule Summary Quoting Service Contract Start date Policy Simplification Introduce common definitions, ability to tag data and enrich with partner data. Provide visibility to actionable insights through clean data and advanced analytics. Deliver simplified next generation quoting, ordering and management experience. Expand upon consumption based, auto-renew business models. Simplify through policy. Simplification
- 16. Automation Conversational Commerce – Digital Assistant
- 17. Security Everywhere 4TB Data Collected & Analyzed NetFlow Analyzed per/day (Lancope) 15B Traffic Inspected per/day 27TB Alerts per/day (NG-IPS) 1.5M Network Events 1.7T 10K Files Analyzed per/day (ThreatGRID) 5.8B DNS Records per/day 6M Web Transactions Inspected per/day (WSA) 425 Devices Detecting & Preventing Incidents 4.1M Email Transactions Blocked per/day (ESA) Security One day defending Cisco… During Before After 1 2 3 Discover Enforce Harden Detect Block Defend Remediate Scope Contain
- 18. (Real Time Predictive Score + Prescriptive measures) Augmenting Cisco Support with Analytics Avoidable RMA Identification Categorization of ARMAs Predicting ARMA + Cisco Spark Application AI Bot Identification & Categorization Prediction Prediction Model Backend Engine A-RMA viewDecision Cockpits Analytics Consumption Analytics Identified “Avoidable” Returns Providing Metrics / Insights into root causes Digital assistant for Support to minimize “Avoidable” Returns Value Generated Analytics
- 19. Continuous Innovation Culture Multidisciplinary Labs Business aligned operating model, people and capabilities (technical depth / engineering skillsets) Agile Method and Mindset Modern DevOps Tool Chain Test and Learn on Cloud Micro-Service- Led Architecture and App Consolidation Shared Components Data-Centric Management Model Continuous Innovation
- 20. Continuous Delivery Analytics Application Are we baking CD Practices and Quality while building the Software? Developer Are we measuring Developer and Vendor Software Contributions? Security Are we baking Security while building the Software? Platform Are Continuous Delivery Platforms and Practices pervasive? Technical Leads Senior Execs Software Developer Senior Execs Security Architect Senior Execs CoDE Team Senior Execs Analytics
- 21. Accelerating Digital Skills IT Skills Report Digital Competencies IT Skills Academy Education, experience, exposure offerings Progress Needed for the future Top 10 skills needed for each competency area SAFE / Agile: ~ 355 Scrum Masters Data Scientists: ~ 95 graduates Security: White Belts: 1470 Green Belts: 226 Engineering Cloud Training: 123
- 22. Leading Change Clear Vision Building a sense of urgency Iterative Execution Architecture Leadership Culture of innovation / Risk taking Lessons Learned
- 23. “If the rate of change on the outside exceeds the rate of change on the inside, the end is near.” - Jack Welch
Editor's Notes
- As our customers continue to evolve as technology shifts around them, they look for a strong partner that will be with them for the long term. Cisco’s financial strength demonstrates our staying power and our ability to continue to grow and innovate. They ask themselves such questions as: Will Cisco be around when I need them? Does Cisco have the financial strength to invest in innovation? Can we count on Cisco to provide a strong portfolio of integrated products and solutions? In each case, the answer is “yes.” Cisco has weathered may economic storms and captured major market transition.
- Growth Areas We Must Focus on for the Future Evolution of the Network Service Provider Cloud and Next-Gen Data Center Security IoT and Apps – show our differentiation relative to IoT (Fog, analytics with Jasper) Analytics
- 8
- Lets begin with the million-dollar question – Wht is Digital Business Transformation? Gartner defines this as “Digital business is the creation of new business designs by blurring the digital and physical worlds” To transform into a successful digital business you will need 3 critical capabilities Transform Processes and Business Models which leads to faster time to market and leaner operations Explosion of connected devices disrupts value chains paving the way for Business Model disruption. By 2020, one million new devices will go online every hour which enabling quicker automated decisions driving efficiencies to a new level Personalize Customer/Citizen experience which leads to increased customer loyalty and greater insight to predict future purchases Why so? Accenture surveyed ~13,000 consumers in 33 different countries and found that 66% i.e 2 out of every 3 consumers switched providers due to poor customer experience and by 2016 Gartner predicts that “89%i.e 9 out of every 10 companies will compete primarily on the basis of the customer experience Empower their workforce for efficiency and innovation which leads to increased productivity and better employee retention Again, why does this matter? Gallup surveyed over 1000 employees each in about 142 countries representative of 98% of the world population and found that about 87% of employees are disengaged and when companies address this dissatisfaction and bring it town to 10%, their earnings per share jumps by a whopping 50% These changes are forcing companies to become more digital when people and things interact to conduct business Source: Digital Business Definition Gartner IT Glossart - http://www.gartner.com/it-glossary/digital-business/ 18M quote Gartner G00293702, 30 Oct 2015, Forecast Alert: Internet of Things — Endpoints and Associated Services, Worldwide, 2015 “…Gartner is now projecting shipments of 6.6 billion Internet of Things (IoT) endpoints in 2020 …” Logic In 2020 devices shipped = 6600 million 365*24 hours = 6600 Devices shipped every day in 2020 = 6600/365 = 18.082 M 87% quote Gallup 2013, State of the Global Workplace: Page 7 “…Overall, among the 142 countries included in the current Gallup study, 13% of employees are engaged in their jobs, while 63% are not engaged and 24% are actively disengaged…” 1.5x quote Gallup 2013, State of the Global Workplace: Page 7 “…Organizations with an average of 9.3 engaged employees for every actively disengaged employee in 2010-2011 experienced 147% higher earnings per share (EPS) compared with their competition in 2011-2012. In contrast, those with an average of 2.6 engaged employees for every actively disengaged employee experienced 2% lower EPS compared with their competition during that same time period…” 66% quote Accenture 2013 Global Consumer Pulse Survey – Page 10 “…Globally, there is a 4 percent increase in switching due to poor customer service to 66%...” Sample size: 13168 consumers in 33 countries 89% quote Gartner Survey Finds Importance of Customer Experience is on the Rise; Marketing is on the Hook, Jake Sorofman, Laura McLellan, Sep 2014 Actual quote – “…The trend is clear: the percentage of companies competing primarily on the basis of customer experience is rising from 36% two years ago to 58% today to a whopping 89% two years from now. The implication is that customer experience has become a strategic imperative.”
- I put the story of our journey in the below notes. This is not meant to talk word for word, but to pick the points that need to be delivered to the appropriate audience. Each of us have a style of presenting so use your style and speak to key points to get your message across. And it should be a flow and not intended to be a start / stop at each section. It is about it all coming together. Start of Notes: ITaaS - The Foundation of Cisco’s Digital Business IaaS – Catalyst of our Services Architecture. Starts with a solid foundation – which in our case we a solid Infrastructure which was the catalyst of our Services Architecture. Our first step was to virtualize / digitize the infrastructure assets of Network, Compute, Storage and Security.. And our key communications services. Which we really termed as Infrastructure as a Service and we branded it CITEIS – Cisco IT Elastic Infrastructure Services PaaS – enabling orchestration.. Extending the Cloud That was great because we were able to quickly deploy new core infrastructure services, but our development / business facing teams still needed to have other assets such as App Servers, Web Servers , DB schemas as well. It was still taking weeks to months to get that deployed. We took the same Networked Programmability / Automation mindset and we extended the Cloud so to speak. Moving simplicity up the stack…extending the cloud. DaaS – Powering faster and scalable insights This foundation of programmability and automation has allowed not only to look at the infrastructure assets but really look at areas like our Data Architecture. Pulling the same capabilities and disparate data sources and Virtualize them. Using a foundational data approach we used key technologies such as Cisco Composite to Virtualize many data assets and Hadoop to not only allow quick and scalable access to data, but really lay the beginnings of our Data as a Service model. Driving a set of data services to improve the visualization and getting much improved insights into data for fast and more precise decision making. We are taking the same self service, programmable and automated approach to data and we have recently deployed both Cisco Composite (Virtualization) and Enterprise Hadoop (Highly scalable / computations) on our Application Centric Infrastructure – will improve policy management of security and faster provisioning based on data needs. CDaaS – Continuously delivering FASTER and More Secure! Over the past 2 years we have focused heavily on improving our release capabilities. We had perfected the art of waterfall, in fact we made them faster, moving to approximately 24 releases per year with that approach. But many people later and still complex PLC processes we began to lay a foundation of agile. We quickly learned of all the silo’d agile activities and determined an approach to deliver software and other key assets of Planning to Release as a Services. We called it Continuous Delivery. There were many tools and methods, so we standardized on a set of tools and digitized the toolchain. We also implemented a standard training through the SAFE agile approach – for both IT and the business We learned that we have to approach the delivery of experiences and capabilities and one team (biz and IT) Over that 2 year period we went from 80/20 Waterfall to Agile to the opposite. And delivery at over 90% improved velocity and releasing – nearly any time. APPaaS – Delivering Contextual Experiences and Insights, anywhere. With this Services Everything approach, we have laid a great foundation for our Digital Business and experienced through our applications. At the end of the day, the business policy and process is delivered through applications – mobile, web, machine, IOT, and being able to collaborate across all types of applications. We often here the term bi-modal, multi-modal, or brownfield / greenfield. I believe there is one mode. FASTER and MORE SECURE! And having the ability to program and orchestrate apps through a solid services foundation of data and infrastructure is key. Thus we can really talk about Applications as a Service. And our aim is to embed Unified Collaboration capabilities (SPARK) into our business processes and how we work. Having data, voice, video an an interactive service to provide contextual experiences and insights. Examples are how we collaborate everyday together, but also how we have embedded collaboration into the Services (TAC Kitchen) and Sales (Collaborative deal approvals) processes. The mindset and culture of simplicity, automation and gaining insights of our ITaaS journey are foundational to Cisco’s Digital Process. We are only touching the surface of what is possible, but the IT and more importantly business outcomes have been accelerated through this foundation. End of Notes This should also align very well to the first Digital Process slide – which shows the process and elements, next the blueprint slide which shows the steps, then this target slide to show and describe what we have done… and then subsequent to these three slides we can show the business outcomes. E.g. Supply Chain, Customer Service, Sales, and even IT.. Depending on the audience. In this case we can use the Supply Chain and Customer Service.
- Chuck’s Slide: How We Will Transform 5 Digital Principles
- Next we will go through examples which illustrate how we have applied each of the principles
- This use case shows the end-to-end digitization of the Renewals process, which was previously very disconnected. This use case focuses on providing a frictionless experience for Renewals. Its about providing visibility to actionable insights, using data and analytics to determine the right time for action. The simplified process gives us insight like: When to approach a customer Opportunities for refresh or end of life products and also providing the migration path from old product to new Overall simplified experience throughout the renewals cycle This use case also showcases the simplification of policy & experience- before digitization, we must clean up our existing processes in the Data Foundation through data cleansing with common definitions and taxonomies.
- We can simplify processes as much as we can, and automation can be used to further hide the complexity of systems and processes. This is an example of a Digital Assistant automating our commerce interactions.
- Visibility is Key in Catching threats BEFORE they can do harm Cisco is working hard to keep up with the threat landscape and our technology plays a vital role in this. And although the numbers seem daunting in terms of the amount of traffic we inspect, the number of network events we monitor, etc., the capabilities to automatically detect and remediate as well as retrospectively remediate are what allows us to deal with 95% of our incidents. Automation is also playing a key role in dealing with the remaining 5% of incidents with capabilities such as context-aware security analytics, StealthWatch identifies known bad behavior or anomalous activity. For instance, if a user or machine normally only interacts with a few megabytes of network data a day but suddenly starts collecting many gigabytes of data in a short period of time, it could be hoarding data in preparation for exfiltration. StealthWatch can detect this activity by building baseline profiles to understand what normal, everyday traffic patterns looks like and then alarming on activity that falls outside accepted thresholds. We want to stop ~95% of the bad stuff knowing that ~5% (advanced threats) will get through. Incident Detection and Response (ID&R) promotes operational metrics back into the work flow process and provides attention on maturing our Data Loss Prevention service lifecycle, which is paramount at all levels of our service. These metrics shows how we are improving the service, providing value back into the organization, and ensuring that we are securing our customer’s assets: Traffic and Events 27TB traffic inspected per day – equivalent to 2.2K hours of Blu-ray video 1.2T network events 425 devices detecting and preventing security incidents Data Collected and Analyzed 4TB data collected and analyzed 15B NetFlow records analysed per day (Lancope) 5.8B DNS records per day (Passive DNS) 1.5M alerts per day from ~350 sensors (IDS/IPS) Transactions Blocked 6M web transactions/day, 75K blocked automatically (WSA) 5.4M emails inspected, 4.1M blocked/day (ESA) Seeing threats DURING an event: Using Advanced Malware Protection (AMP) capabilities, we are able to detect more threats before damage occurs: 90% are desktop/laptop related FY15-FY16 – 86% year over year increase in incidents detected FY16-FY17 – projected 34% year over year increase in incidents detected Progress year over year since FY13 per security solution: Net/Net: Mean Time to Detection is below target Containment continues to be our Achilles heel as we await strategic execution: ISE quarantine in our automated workflow to make an impact to our infected host containment metrics. Total Incidents FY13: 394 FY14: 2869 FY15: 5322 (86% year over year increase) H1FY16: 3558 (projected 34% year over year increase in incidents detected) FireEye – Advanced Malware Detection FY13: 68 FY14: 1239 FY15: 413 H1FY16: 28 Cisco FireAMP – Advanced Malware Detection FY13: - FY14: 24 FY15: 800 H1FY16: 315 Cisco Web Security Appliance FY13: 34 FY14: 658 FY15: 1338 H1FY16: 787 Cisco Intrusion Prevention System FY13: 149 FY14: 631 FY15: 314 H1FY16: 604 Passive DNS/RPZ FY13: 72 FY14: 95 FY15: 1778 H1FY16: 1483 Host Based IPS FY13: 56 FY14: 114 FY15: 530 H1FY16: 269 NetFlow FY13: - FY14: 14 FY15: 107 H1FY16: 70 Data Loss Prevention FY13: 15 FY14: 94 FY15: 42 H1FY16: 2
- Product quality is a function of component quality, software defects and how we diagnose & support our products. RMA are product returns. Analytics helped identify a category of returns that are completely avoidable. They are result of mis-diagnosis of the issue by the support personnel. Support case from customer is likely a result of mis-configuration or setup but we issue a return. Its costly for cisco and customer is frustrated as the new product has the same exact issue. Analytics is now helping support identify the support cases which may likely fit this pattern and we have been able to reduce our return rates and improve customer satisfaction as a result. Machine learning / analytics can now help drive consistency in how we support our product and drive a measurable change to bottom line & customer sat. Value metrics • 50% reduction in UCS-B returns • Its now being rolled out across support for all products ML Alogrithm Logistic regression modeled on open source Apache Spark Machine Learning Library. AI BOT leverages the same model by querying it from Cisco Spark.
- This slide is similar to slide #20- do we need both?
- Automated metrics generated from analyzing the code and usage of the continuous delivery platform has been critical to drive the adoption of CD in IT. We don’t need to ask or get status on adoption or security vulnerabilities or usage Measure and get status directly from the platform / tools on which applications are leveraging it or not. Measuring developer productivity. #s of lines of code, defects, # of check-ins Automated checking for Security vulnerabilities