Digital transformation is the changes associated with the application of digital technology in all aspects of human society.[1] Digital transformation may be thought of as the third stage of embracing digital technologies: digital competence → digital

usage → digital transformation, with usage and transformative ability informing digital literacy. The transformation stage means that digital usages inherently enable

new types of innovation and creativity in a particular domain, rather than simply enhance and support the traditional methods.[2]

Industrial Revolution 4.0

Steam, water,

mechanical

production equipment

Division of labor,

electricity, mass

production

Electronics,

IT, automated

production

Blurring the

physical and

the digital

divide

1784 1870 1969 2016

In 1971 small company Intel released 4004, first ever microprocessor.

It had only 2.300 transistors. Today, modern architectures have over 1.75 billion transistors, delivering 400.000 times more computing power.

In 1975 Microsoft was born, bringing power of the computing to the masses

„A computer on every desktop and in every home”, Microsoft vision

40 years later... Digital Economy is leading us to new Industry 4.0 Revolution.Digital Economy will reach EUR 3.2 trillion in the G-20 economies and already contributes up to eight per cent of GDP, powering growth and creating jobs.

Supercomputers in ourhands.

13

The world’s largest taxi company

does not own any taxis

The world’s largest accommodation provider

does not own accommodations

The world’s largest phone company

does not own any infrastructure

The world’s most valuable retailer

does not have any inventory

The world’s largest cinema house

does not have any cinemas

The world’s most popular media owner

does not create any content

Seeing the world with new eyes…

The cost of key technologies

has fallen rapidly.Time to reach $1B valuation or more.

Source: World Economic Forum

Astonishing Pace of Change

Affordable Transformative TechnologyConnecting Physical and Digital

Financial Services

Manufacturing

Retail & CPG

Healthcare

Public Sector

Media3D Printers, $500

1% of 2007 Cost

SmartphonesSensors

.3% of 2007 Cost

Solar Power

.5% of 1984 Cost

DNA Sequencing

.01% of 2007 Cost

Industrial Robots

3% of 2007 Cost

Drones, $700

1% of 2007 cost

Telecom

Automotive

Virtual Reality, $600

$600, 1% of 2007 cost

Voice Recognition Holographic Computing

Wearables Motion Sensing Technology

Digital Era Value Very Sobering Reality….Digital Companies grow fast and disrupt further

$25b $50b $75b $100b $200b $300b $400b $500b

YEA

RS IN

BU

SIN

ESS

%

IS GONE

O U T O F 5 0 0 L A RG E S T

G LO B A L CO M PA N I E S i n

1 9 5 5 …

WORLD IS CHANGING

Digital Business Transformation: Designing for your future customer

Business architecture is now a strategic variable. . . Do not harness technology to the imperatives of the business model, but rather, adopt the business to the possibilities of the technology.

~ Paraphrased from Boston Consulting Group, BCG Perspectives, Oct. 2016

Source: PWC CEO Survey

Technological advances

Demographic shifts

Shift in global economic power

Resource scarcity & climate change

Urbanization

Trends that will

transform

business, next five

years (%)

86% of CEOsconsider “Digital”

their #1 Priority

CEOs believe

technology will transform

their business more than any

other global trend

Digital transformation is both inevitable and mandatory

• In the midst of a major tech revolution, aka the “4th industrial revolution”

• #1 priority on our customers’ agenda

• “There is no other company than Microsoft that can have that kind of dialogue with customers with credibility” ~ Satya Nadella

of the world’s economy

will be digital by 2020

25%

Organizations mature in their

journey generate

100M+ more

operating incomethan those that lag behind

Organizations can’t transform to digital unless people do

Top of mind for business leaders and their digital transformation

Leaders embracedigital-first to fast track transformation

Harness informationto change the way youdo business

Digital transformation =

Cultural shifttechnology problem 1

of the respondents

identified IoT

initiatives — and

related machine-to-

machine and telematics projects — as

new areas of spending for the year ahead 8

RIGHT SKILLS

The most commonly cited

barrier to digitization for

most CIOs 2

shortage

Central to any

digital workplace

initiative:

increasing the

involvement of the

employee community in

technology strategies 3

of CIOs with hiring plans are in

search of people with combined

42%

TECH BUSINESS+backgrounds 4

Most important

decision

CEOs must

make in

2016 is to$invest in data

science

development 5

The CIO’s challenge is

to convince the entire

enterprise that

“SECURE BY DESIGN”

should be treated as a

business priority 6

By 2018,

AI will be

incorporated

into

1/2of all apps developed. By

2020, savings garnered by AI-

enabled efficiencies are

expected to total an estimated

60B for U.S.

enterprises 7

29%

30%By the end of 2016,

of businesses will have begun monetizing

their information assets, which is fueling

an information-driven

economy targeted at $156B 9

1 Forrester Research. The race to digital mastery is on in 2016. Forrester.November 11, 2015.

2 Andy Rowsell-Jones, et al. 2016 CIO Agenda: Global Perspectives onBuilding the Digital Platform. Gartner. February 23, 2016.

3 Matthew W. Cain and Paul Miller. Recipe for Digital Workplace Execution:Transform the Employee Experience. Gartner. March 3, 2016.

7 John Dodge. Who’s in charge of AI in the enterprise? CIO. February 15, 2016. 8 Beth Stackpole. Forecast 2016: 5 fast-track trends to tackle now

(and one to ignore). CIO. December 1, 2015. 9 Mike J. Walker, et al. Top 10 Strategic Technology Trends for 2016:

Information of Everything. Gartner. February 26, 2016.

4 Beth Stackpole. Forecast 2016: 5 fast-track trends to tackle now(and one to ignore). CIO. December 1, 2015.

5 Ken McGee and Mark Raskino. The Most Important Digital Business DecisionSenior Executives Must Make in 2016. Gartner. February 16, 2016.

6 Marcus Shingles et al. Tech Trends 2016: Innovating in the digital era.Deloitte. February 22, 2016.

in savings garnered for U.S. enterprises 5

Digitalization drives down costs

Digital transformation and cost savingspriorities

Investments ininnovation pay offin efficiency

Future-ready your workforce throughdigital literacy

30%By 2018,

of organizations will formalize

workforce digital literacy strategies

to improve business outcomes and

employee engagement 9

1 James Manyika. Digital America: A tale of the haves and have-mores. McKinsey.January 12, 2016.

2 £10bn saved in 2012/13: Efficiency and reform 2012/13 summary report,UK Cabinet Office, 2013.

3 Susan Lund et al. Managing talent in a digital age. McKinsey. February 29, 2016.

7 Bill Snyder. The 6 Hottest New Jobs in IT. CIO. March 7, 2016. 8 James Manyika. Digital America: A tale of the haves and have-mores.

McKinsey. January 12, 2016. 9 Gavin Tay and Achint Aggarwal. Examining the Promise and Progress of

Digital Workplace Programs Globally. Gartner. January 27, 2016.

4 Marcus Shingles et al. Tech Trends 2016: Innovating in the digital era.Deloitte. February 22, 2016.

5 John Dodge. Who’s in charge of AI in the enterprise? CIO. February 15, 2016. 6 Jim Rapoza. Rounding Up Virtual Machine Sprawl With Private Cloud.

Aberdeen. January 4, 2016.

Digital labor platforms can:

increaseoutput by

9%

reduceemployee-related costs by

7% 3

57%

OPERATIONS

Global IT budgets:

16%INNOVATION 4

reduction in IT expenses for organizations after deploying a private cloud 6

40%

AIBy 2018:

½By 2020:

60B in savings garnered

for U.S. enterprises 5

of all apps developed

will incorporate

artificial intelligence

TECHNOLOGIESare moving faster than the EXPERTISE

needed to exploit them can

be disseminated to

the workforce 7

gov.uk saved

63Min public spending withina year of its launch 2

Digitization of labor, capital, and multifactor productivity

Combinedannual impact:

$1.6T - $2.2 Tby 2025 1

BASELINE PROJECTIONS

+6% - 8%US GDP

encouraging workers

to participate in the

digital economy 8

ACCESSINFRASTRUCTUREDIGITAL LITERACYDIGITAL TOOLS

All industries are investing heavily in digital transformation

Source: IDC, PAC, Gartner, Markets and Markets, MGI analysis

1 2016 calculated based on 2015 actuals from Gartner plus an 8% CAGR

$151

billionForecasted

digital

transformation

spend for top

ten highest-

spending

industries

Public sector

Telco and media

Advanced manufacturing

Retail/wholesale trade

Health

Professional services

Basic goods

manufacturing

Utilities

Transportation

1

2

3

4

5

6

7

8

9

10

2016

$ Billions

Financial services

6

7

9

12

12

15

19

19

20

32

2019

20161 155

200-

239

$ billions

Forecasted digital transformation spend 2016-19

But cloud momentum continues to accelerate

“If you’re resisting the cloud because of security concerns, you’re running out of excuses.”

“The question is no longer: ‘How do I move to the cloud?’ Instead, it’s ‘Now that I’m in the cloud, how do I make sure I’ve optimized my investment and risk exposure?’”

“By 2020 clouds will stop being referred to as ‘public’ and ‘private’. It will simply be the way business is done and IT is provisioned.”

26

▪

▪ Expanding competitive radar screen; non-traditional competitors

▪ Creative, new business models

▪ Fast imitation and commoditization

▪ Highly information intensive digital business designs

▪ Extended, complex information chains

Other

Providers

Traditional

Competitors

New

Players

Other

Influencers

Traditional

▪

▪

▪

▪

▪

▪

▪

Higher Order Opportunities

Services

Economics

Product

Digital Leadership is Now a Continuous Process…

Thinking BIG with customers is all about impacting the Digital Business Model

27

Effort Focus

Digital

Transformation

New ways to create value with a digital

business

Digital

Effectiveness

Redesign and digitize processes to more

fully reach desired outcome

Digital

Efficiencies

Digitize existing processes to reduce waste

of time, effort and expense

Digital

Replacement

Replace existing digital capabilities with

lower cost ones

Business as UsualValue is created when things change, so no

value creationV

alu

e C

reati

on

Time

The value created by

any change decays

over time

Value Creation +

Value Destruction -

Digital Business Transformation Impact over Time

THINK

BIG

442020

ZETTABYTES OF DATA

4.42013

0.162006

1 ZETTABYTE = 1B TERABYTES

Data is increasing at rates never witnessed before

30%By the end of 2016,

of businesses will have begun monetizing

their information assets, which is fueling

an information-driven

economy targeted at $156B 9

In 2016, world around us is different. And we needed a different mission.

„Empower every person and everyorganization on the planet to achieve more.”

Microsoft Mission

Digital transformation focus

ENGAGING

CUSTOMERS

Give them new

experiences

they love

EMPOWERING

EMPLOYEES

Reinvent

productivity and

enable a data-

driven culture

TRANSFORMING

PRODUCTS

Innovate products and

business models

OPTIMIZING

OPERATIONS

Modernize

portfolio, transform

processes and skills

Build a digital innovation lab

within a customer’s location,

and start to bring the book of

Dreams to life, your Digital

Dream Factory

Identify, with customer

sponsor, a digital

transformation team, your

Dream Team

Drive, orchestrate and document a

co-created digital transformation

journey, your Book of

Dreams

Your Digital Transformation Journey – Our Approach

Current Threat Landscape

THE REVOLUTION

CYBER-CRIME CYBER-ESPIONAGE

CYBER-WARFARE

CYBER-TERROR

“FUNDAMENTALLY, IF SOMEBODY WANTS TO GET IN,

THEY'RE GETTING IN…ACCEPT THAT.

WHAT WE TELL CLIENTS IS:

NUMBER ONE, YOU'RE IN THE FIGHT, WHETHER YOU

THOUGHT YOU WERE OR NOT. NUMBER TWO,

YOU ALMOST CERTAINLY ARE PENETRATED. ”Michael Hayden

Former Director of NSA & CIA

“Defenders think in lists;

attackers think in graphs.

As long as this is true,

attackers win.”John LaTour (and others)

https://blogs.technet.microsoft.com/johnla/2015/04/26/defenders-think-in-lists-attackers-think-in-graphs-

as-long-as-this-is-true-attackers-win/

A Real Graph Example

…and then traverse the graph to the target

…Adversaries get in at an edge

The Pass-The-Hash Nuclear Bomb

Attackers think in graphs Defenders think in lists

✓ Firewall

✓Anti-virus

✓ Security Logs

✓ Incident Response

Plan

✓Assets

✓Networks

✓Applications

✓Users

…

Recon &

TargetingDelivery

Establish

FootholdEscalate

Lateral

Movement

Persistenc

e

Mission

Objective

Prepare &

WatchDetect

Alert &

MobilizeTriage

Investigat

e

Response

COAsExecute

Attackers / Defenders points of view

Denial of

Service?

Credential Theft?

STRIDE mnemonic

• STRIDE helps you think through potential threats more completely

Threat Plain English

Spoofing Impersonation

Tampering Unauthorized Modification

Repudiation False claim of “I didn’t do that bad thing”

Information Disclosure They got the files (or encryption keys)

Denial of Service Unavailable

Elevation of Privilege They aren’t supposed to be an administrator!

A Data Breach starts with

Identity Breach and Loss of

Control

Loss of Control often leads to

Denial of Service (Cyber Terror)

Cybersecurity Framework

Defend against

Determined Human

Adversaries and

Advanced Persistent

Threats (APTs)

Protect, Detect, and

Respond to malicious

activity from targeted

attacks

HOW DO YOU SEE YOUR FUTURE?