SEE. A global and regional outlook into the minds of the CXO. Katie Axam CMO IBM Central & Eastern Europe

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1 A global and regional outlook into the minds of the CXO Katie Axam CMO IBM Central & Eastern Europe SEE

2 Highlights from the IBM Global C-Suite Study 2

3 Incumbents strike back Dancing with disruption Incumbents hit their stride Orchestrating the future The pull of platform business models Trust in the journey The path to personalization Innovation in motion Agility for the enterprise 3

4 12,854 Global C-suite Study respondents in ,148 Chief Executive Officers 2,102 Chief Financial Officers 2,139 Chief Human Resources Officers 3,457 Europe 2,258 Chief Information Officers 1,709 China 3,144 North America 1,171 Japan 2,091 Chief Marketing Officers 1,032 South America Middle East 1,014 Middle East Africa and Africa 1,327 Asia-Pacific 2,116 Chief Operations Officers 2,047 Face-to-face meetings 10,807 Live phone interviews 4

5 Re-inventors (27%) Practitioners (37%) Aspirationals (36%) Cluster analysis identified three distinct segments of organizations among the study participants Tightly-aligned business and IT strategy Able to continuously adapt and manage disruption Culture of experimentation, co-creation and design thinking Close collaboration with customers and partners Highly ambitious, but capabilities don t yet match their ambitions Looking to disrupt through innovation Exploring new business models, especially platforms Inclined to take on more risk Plan to execute with agility Challenged to get the right vision, strategy and execution capabilities in place Focused more on defensive strategies At a relatively early stage of the digital journey Digital skills gaps are a major concern Leverage data to create compelling customer experiences 5

6 IDC 2018 Adriatic Study: Perception and Use of Cloud Computing & Artificial Intelligence Finance & Telco Sector 6

7 C level executives taking part in the IDC Survey 7

8 Cloud Computing findings Implementation & Status Plans 4 in 5 using some form of Cloud 67% planning to use new cloud services in the next 12 months Innovator companies using cloud to a higher degree & planning to expand their cloud usage Private cloud most popular & 2 in 5 companies using Public cloud. 1/3 companies planning to use hosted cloud in next 12 months Saas most preferred public cloud Cloud Maturity Only 1 in 4 will have an ad-hoc approach to Cloud Within 2 years, 3 in 5 companies see themselves as Cloud native Companies interviewed have less mature Cloud strategy than CEE peers None of the companies interviewed had a public cloud first approach when needing net new IT services 3 in 4 companies have no predefined barriers to choose public as the delivery model Innovator and Follower companies show very different approaches to Cloud Triggers for Cloud Adoption 1/3 are cloud resistant and wouldn t consider adopting public cloud even if functionality or service is able available this way Providing agility or speed to business is a strong trigger End of cycle, upgrades, expansions or re-platforming are also strong triggers CEE peers are more motivated for switching to cloud services when business is demanding agility or speed OR upgrades / expansions or replacing data center capacity. CEE more motivated by OPEX or CAPEX reductions Security Data privacy and loss of control over data primary concerns 2/3 companies concerned about compliance as the biggest challenge 2/5 companies concerned about consistency of security policies combining cloud and traditional architectures Integration of cloud and on-prem security solutions represent the major challenge 8

9 Artificial Intelligence findings Implementation Status & Plans 50% on interviewed companies are using some kind of AI solution AI implementations are expected to accelerate, 71% of the companies are planning new AI solutions within 12 months Only 1/3 are fully sure about the quality criteria of their data (accuracy, up to dateness, consistency) across their company Educational gap beyond data assessment Innovator companies are more data driven and business models and decisions rely on data Barriers for Faster Adoption Talent shortage is the strongest barrier to more investment in AI Few companies have concerns about the maturity, although there is still lack of understanding from the business to the value and potential of AI Companies looking for more convincing business cases Data privacy, governance & regulatory implications represent sizable obstacle due to no experience around assurance of compliance or security risks when using AI solutions Business Areas using AI Solutions Most companies applying AI in the area of security and privacy 1 in 5 (80% being finance companies) using AI solutions for fraud and risk detection and 1 in 3 companies planning to implement Front end functions with a high end of customer engagement represent strong potential for the future Direct, indirect and online sales represent the highest potential for AI investments in medium term Back office functions (HR, payroll, legal) lag behind acceptance of AI and not among areas of investment (despite being relevant for these functions) Adoption of AI Technologies Cyber security applications represent highest current adoption For future plans, customer interaction and solutions such as chat bots and AI enabled CRM are top of the list Automation and risk mitigation are key motivators for AI adoption. 9

10 Are organisations in SEE any different? Leveraging & attracting talent Data & Security Compliance Business agility, speed & resiliency Harness digitalisation & automation Consumer expectations & customer service Consumer expectations & customer service Fraud detection & Risk Management Identifying business opportunities with AI Elevating network or service operations 10

11 Introducing CXO Club moderators Identify business opportunities with AI Leverage and attract talent Business disruption - the "what" and the "how" Consumer expectations and customer service Data and Security Compliance Increase business agility, speed and resiliency Predicting uncertainty with accurate data Fraud Detection and Risk Management Harness digitalization and automation Cognitive Service Operations Center - Elevate network or service operations 11

12 Thank you Katie Axam CMO IBM Central & Eastern Europe 12

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