Importance of Fintech to India

On 8 November 2016, the Government of India announced the demonetization of all ₹500 and ₹1000 banknotes, it set off a wave of Fintech growth in India. Fintech is now mainstream and a critical segment for the future of India's economic growth.

Here are 10 reasons why Fintech is very important to India.

1. Economic Growth
The payment segment has been a major enabler of economic growth. Electronic payments systems added $300B to GDP in 70 countries between 2011-2015, which resulted in ~2.6Million Jobs/Yr
Each 1% increase in electronic payment produces ~$104 B in consumption of goods & services

2. Financial Inclusion
Fintech opens up opportunities for the previously unbanked population to access modern financial instruments. For people living in poverty or at the fringes of the economy, Fintech lowers costs of Financial transactions: Lower cost of credit and other banking services.

3. Speed & Quality of Innovation
Fintech drives improvements in traditional financial services – which will replace legacy systems. Eg: Peer-to-peer lending, Robo advisors, Hi-frequency trading

4. Business Sustainability & Scalability
Fintech has made businesses sustainable & Scalable. The entire e-commerce economy was built on e-payment systems and new business models such as Ridesharing: OLA, UBER, Metro Bikes, etc were developed on Fintech e-payment systems – which allows these businesses to scale and grow rapidly

5. Transparency & Audits
All digital transactions are inherently auditable hence bringing greater transparency into the system. Data sharing in real-time across banks & financial institution reduce fraud risks and reduces the cost of regulatory processes.

6. New Value Streams
New fintech technologies are creating new business opportunities. Bitcoin & other cryptocurrencies have spawned whole new businesses.

7. Market Curation & Structural Transformation 
Fintech technologies are transforming other industries. For example, healthcare record management, Real estate, land registration with Blockchain, etc. This is bringing structural reforms to businesses that were on the fringes of the regulated economy into the mainstream economy.

8. Collaborative Culture
New Fintech businesses are built in collaboration with other businesses. For example, Blockchain is based on open collaboration between members who host the shared ledger.

9. The Scale of the Industry
Fintech has grown from being a niche to mainstream. Today Fintech companies are collectively worth more than $500Billion and directly employ millions of men.

10. Borderless Innovation
Technological innovations in Fintech can be quickly adapted across borders, creating new competition and new opportunities for existing players. This rapid innovation is bringing whole new financial hubs and opening new markets.

Product Management 101 - Customer validation is the key

Recently, I was having lunch with a co-founder of a startup in Bangalore. They have a vision which sounds good on the surface: Provide data loss protection on Cloud. Though this sounds as such a old & proven idea, they have a very good secret sauce which gives them a unique value proposition: Security, Cost benefits & much better RPO/RTO than competition.

Like most entrepreneur, he started out by validating his product idea with customers. Starting with customer survey, asking customers about their pain points and asking them:  "If this product solves your problem, will you buy it?"

Customer validation is a good point to start, but one must also be aware that such a survey can lead to several pitfalls.

1. Customer needs could change with time, and are no longer interested when the product is launched.
2. Customer just expressed his 'wants' and not his 'needs', and may not pay for the actual product.
3. Customer has no stake in the product. Just answering few questions was easy - there was no commitment or risks.

All this risks imply that customer validation may result in false positives.

False positive is a known risk factor in new product development and startups often take such risks. In case of my friend's startup, he took that risk and decided to invest in developing a prototype.

Several months have gone by and his company is busy building the prototype and his biggest fear is that customers may not embrace his product and is constantly changing what should be his MVP - Minimum Viable Product.

What is a Minimum Viable Product?

A minimum viable product (MVP) is the most pared down version of a product that can still be released. An MVP has three key characteristics:

It has enough value that people are willing to use it or buy it initially.
It demonstrates enough future benefit to retain early adapters.
It provides a feedback loop to guide future development.

The idea of MVP is to ensure that one can develop a basic product which early adapters will buy, use & give valuable feedback that can help guide the next iteration of product development.

In other words, MVP is the first version of a customer validated product.

The MVP does not generate profits, it is just a starting point for subsequent product development - which in turn results in rapid growth and profits.

Customers who buy the MVP are the innovators & early adapters, and no company can be profitable serving just the early adapters. But a successful MVP opens the pathway towards the next iterations of the product which will be embraced by majority of customers: 'Early Majority', 'Late Majority' and 'Laggards'.

MVP is also expensive for startups

For a lean startup, developing a MVP can be expensive. MVP is based on: Build -> Measure -> Learn process - which is a waterfall model.

There are two ways to reduce risks associated with developing an MVP. One way to reduce risks is to avoid false positives.

While conducting market research during customer validation process, one must ensure that customer is invested in this product development.

At the first sight, it is not easy to get customer to invest in a new product development. Customers can invest their Time, Reputation &/or Money.

By getting customers to spend time on the potential solution to their problem is the first step.

Second step would be get them invest their reputation. Can customer refer someone else who also has the same problem/need? Is the customer willing to put his name down on the product as the Beta user? Getting customer invest their reputation would most often eliminate the risks of false positives.

One good way to get customers invest their reputation is to create a user group or community - where customers with similar needs can interact with each other and new product development team - while helping new product development.

In case of B2B products, customers can also invest money in new product development. Getting customers to invest money is not so tough. I have seen this happen in several occasions. I call this co-development with customers (see my blog on this topic)

Kick Starter programs have now taken hold and today startups are successfully using kick starter programs to get customers invest money in their new product development.

Accelerating the Development Cycle & Lowering Development Costs

A lean startup should avoid developing unwanted features.

Once customers are invested in this new product, the startup will usually start developing the product and march towards creating the MVP.  However, it is common to develop a product and then notice that most customers do not use 50% of the features that are built!

Lean startup calls for lowering wastage by not building unused features. The best way to do this is to run short tests and experiments on simulation models. First build a simulation model and ask customers to use it and get their valuable feedback. Here we are still doing the Build -> Measure -> Learn process, but we are doing it on feature sets and not the entire product. This allows for a very agile product development process and minimizes waste.

Run this simulation model with multiple customers and create small experiments with the simulation model to get the best possible usage behavior from customers. These experimental models are also termed as Minimum Viable Experiment (MVE), which forms the blue print for the actual MVP!

Running such small experiments has several advantages:

• It ensures that potential customers are still invested in your new product.
• Helps develop features that are more valuable/rewarding than others.
• Build a differentiated product - which competes on how customers use the product, rather than having the most set of features.
• Helps learn how users engage with your product.
• Help create more bang for the buck!

Closing Thoughts

In this blog, I have described the basic & must-do steps in lean product development, which are the fundamental aspects of product management.

Customer validation is the key to new product success. However, running a basic validation with potential customers runs a big risks of false positives and investing too much money in developing the MVP.

Running a smart customer validation minimizes the risks while creating a lean startup or lean product development. A successful customer validation of a solution helps to get paying customers who are innovators or early adapters. This is first and most important step in any new product development - be it a lean startup or a well established company.

Taking Analytics to the edge

In my previous article, I had written about HPE's EdgeLine servers for IoT analytics.

In 2017, we are seeing a steady wave of growth in data analytics that's happening on the edge and HPE is in the forefront of this wave - leveraging its strengths in hardware, software, services, and partnership to build powerful analytic capabilities.

With HPE EdgeLine, customers are able to move  analytics from the data center to the to the edge, providing rapid insights from remote sensors to solve critical challenges in multiple industries like energy, manufacturing, telecom,  and financial services.

Why IoT project fail?

Recently, Cisco reported that  ~75% of IoT projects fail. This is because IoT data has been managed in centralized, cloud-based systems. In traditional settings, data is moved from a connected 'thing' to a central system over a combination of cell-phone, Wi-Fi and enterprise IT network, to be managed, secured, and analyzed.

But with IoT devices generating huge volumes of data, and data being generated at multiple sites - even in remote areas with intermittent connectivity. This meant that analysis could not be done in a meaningful way as the data collection was taking time, and when the analysis was completed, results were computed, it was irrelevant.

Centralized cloud systems for IoT data analysis just does not scale nor can it perform at speeds needed.

HPE Solution - EdgeLine servers for Analytics on the Edge

With HPE EdgeLine servers, we now have a  solution that optimizes data for immediate analysis and decision making at the edge of the network and beyond.

For the first time ever, customers have the first holistic experience of the connected condition of things (machines, networks, apps, devices, people, etc.) through the combined power of HPE EdgeLine servers and Aruba wireless networks.

Analysis on the edge is just picking up momentum and it's just the beginning of good things to come.

Today, cloud is omnipresent, but for large scale IoT deployment, a new model of computing is needed emerge where constant cloud connectivity is not essential. Most data will be processed at or near its point of origin to provide real-time response and will be handled on-site in that  moment. Running analytics on edge will save costs, refine machine learning on massive data sets -  that can be acted on at the edge.

In June 2017 at HPE Discover, customers were delighted to get an in-depth view of this solution.

HPE's continued investments in data management and analytics will deliver a steady stream of innovation. Customers can safely invest in HPE technologies and win.

HPE along with Intel is future proofing investments in data and analytics for hyper distributed environments. HPE has taken a new approach to analytics to provide the flexibility of processing and analyzing data everywhere - from right at the edge where data is generated for immediate action and for future analysis in the cloud at a central data center.

Customers are using IoT data to gain insight through analytics, both at the center and the edge of the network to accelerate digital transformation. With HPE Edgeline, one can take an entirely new approach to analytics that provides the flexibility of processing and analyzing data everywhere—at the edge and in the cloud, so it can be leveraged in time and context as the business needs to use it.

This technology was developed in direct response to requests from customers that were struggling with complexity in their distributed IoT environments. Customers, analysts and partners have embraced intelligent IoT edge and are using it in conjunction with powerful cloud-based analytics.

Analytics on the edge is a game changing approach to analytics that solves major problems for for businesses looking to transform their operations in the age of IoT. The HPE Vertica Analytics Platform now runs at the IoT edge on the Edgeline EL4000. This combination gives enterprises generating massive amounts of data at remote sites a practical solution for analyzing and generating insights.

Customers like CERN, FlowServe,  etc are using Edge analytics to expand its monitoring of equipment conditions such as engine temperature, engine speed and run hours to improve maintenance costs. Telecom services companies are pushing the edge with analytics to deliver 4G LTE connectivity throughout the country, regardless of the location of the business.

Closing Thoughts 

Benefits of centralized deep compute make sense—for traditional data. But the volume and velocity of IoT data has challenged this status quo. IoT data is Big Data. And the more you move Big Data, the more risk, cost, and effort you'll have to assume in order to provide end-to-end care for that data.

Edge computing is rebalancing this equation, making it possible for organizations to get the best of all worlds: deep compute, rapid insights, lower risk, greater economy, and more trust and security.

Looking into the future - Right through Automation & Artificial Intelligence

Its no secret that Innovation & creativity is the ultimate source of competitive advantage. But success of any innovative idea depends on a number of other factors: An energetic leadership, Market growth, Significant investments pool, and a real "can do" spirit of the team.

As I write this article, there are thousands of articles being published on web - which state how robots and Artificial Intelligence will replace humans in workforce.

1. McDonald's is testing a new restaurant run completely by Robots 
2. Robot lands a Plane. 
3. Driverless Trucks will eliminate millions of jobs  
4. Smart Machines will cause mass unemployment  
5. Google's AI beats world Go champion in first of five matches  

Today's news is filled with the hype and fear of mass unemployment due to Automation. Today the hype cycle is almost at its zenith and in this background, I was asked to talk about what kind of jobs & employment opportunities will be there in future.

How automation will help mankind?

Automation is actually an innate feature of mankind. If we look into our past, we as a species have always come up with creative innovation to automate mundane tasks, and every time we did this, the civilization progressed by leaps and bounds.

The first ever automation was creation of canal system - thereby automating the transportation of water. This led to the rise of early civilizations in Indus River valley, Egypt, Babylon & China. Since then, civilization has been making a steady progress to automate simple, repetitive tasks.

Simple machines replaced human labor, trains & cars replaced horse drawn carts, Computers replaced clerks, and the list goes on and on.

From all our learning's, we know that if a task can be automated, it will be automated. There is no way a civilization will be able to stop automation. People have no pleasure in doing repetitive labor and the society will promote automation. Period!

And Yes, Today, People are being replaced by algorithms, machines and artificial intelligence.

What shall humans do?

As automation, artificial intelligence, machine learning and robotics grow in capability, humans doing simple, repetitive jobs will be pushed out of their jobs. So what will humans do?

The answer to this question can be found in history. When canals were invented, farmers found themselves with more time on their hands to increase the land area under cultivation. This led to more food production and this freed up people to create some of early classics of literature. Ramayana, Mahabaratha, Upanishads etc. were written during this time. People built massive temples, pyramids, palaces, forts, statues etc.

Industrial revolution also led to an explosion in arts - mainly paintings, writing of novels, poems, sculpture, building of palaces, classical music etc.

In 20th century and early 21 century, automation led to more creativity in terms of space travel, adventures, film making, music and new machines.

All this points towards only one direction. When humans are freed up from mundane tasks, they will use their free time to harness their creative potential.

Humans are innately creative. Machines, computers & Robots are not creative. Humans are far more creative and this creativity cannot be reduced into an algorithm & automated. This implies that the new generation of humans who are trained to be engineers, doctors, scientists and artists etc. will dream up new things to do, build and explore. Perhaps we may discover how to travel faster than light.

How to prepare for the new future?

The current education system is designed to create a workforce of yesterday, and people who do mundane, repetitive tasks and this education system will have to change first. We as a civilization will have to train the younger generation to be creative, develop expansive & divergent thinking. We need to nurture and flourish the creative side of humans and this will free up the younger generation to be creative and innovative.

Modern workplaces also have to change in a big way. Traditional hierarchical top down management system which pigeonhole people into narrow jobs need to be revamped. Silos need to be broken up and creative ideas must be fast tracked as quickly as possible. Businesses must be willing to take risks on new ideas. For example, Ford Motors recently fired its CEO - even after record breaking sales - because Ford as a business now needs a new business models - far from the one of building cars.

Cost of Failure - A major war & conflict

History also tells us the dark side of automation. Whenever automation ushered in a new era, lot of people had too much free time and when this was not utilized in a positive way, humans resorted to war and violence.

In fact, both world wars were in a way caused by industrial revolution. Industrialized European countries had surplus human labor and young population which had nothing much to do and the countries rushed headlong into a catastrophic war.

Today, we are seeing a massive surge in terrorism from people in Middle East and Pakistan. This is because their governments have failed to utilize their workforce in productive ways. Similarly, USA & China have increased their military spending in recent times - as they are not able to channel their enormous economic resources towards creative work.

Closing Thoughts 

We as a civilization are at the cusp of a new revolution - ushered by Automation & AI. Will this result in a golden era of creativity & innovation or will it result in a catastrophic war?

I cannot predict the future, but I know for sure that if we invest in building a creative & innovative society - we can usher in a golden era, else we are doomed for a devastating war. 

6 Key Tools and Techniques for Taming Big Data

Using Big Data across the enterprise doesn't require massive investments in new IT systems. Many Big Data tools can leverage existing and commodity infrastructures, and cloud-based platforms are also an option. Let's take a look at some of the most important tools and techniques in the Big Data ecosystem.

1) Data governance. 

Data governance includes the rules for managing and sharing data. Although it's not a technology per se, data governance rules are enforced by technologies such as data management platforms.
"There's a lack of standards and a lack of consistency," explains Doug Robinson, executive director of the National Association of State CIOs (NASCIO). "There's certain data quality issues: Some of the data is dirty and messy and it's non-standardized. And that increasingly has made data sharing very difficult because you have language and syntax differences, the taxonomy on how information is represented.

... All that is problematic because there's no overarching data governance model or discipline in most states. Data governance isn't very mature in state government nor local governments today, and certainly not the federal government."

Data governance is critical to gaining buy-in from participating agencies for enterprise-wide data management. Before data sharing can begin, representatives of all participating agencies must work together to:

• Discuss what data needs to be shared
• Determine how to standardize it for consistency
• Develop a governance structure that aligns with organizational business & compliance needs

2) Enterprise data warehouse. 

With an enterprise data warehouse serving as a central repository, data is funneled in from existing departmental applications, systems and databases.

Individual organizations continue to retain ownership, management and maintenance of their data using their existing tools, but the enterprise data warehouse allows IT to develop a single Big Data infrastructure for all agencies and departments. The enterprise data warehouse is the starting point for integrating the data to provide a unified view of each citizen.

3) Master data management (MDM) platforms. 

With data aggregated into an enterprise data warehouse, it can be analyzed collectively. But first it has to be synthesized and integrated, regardless of format or source application, into a master data file. MDM is a set of advanced processes, algorithms and other tools that:

• Inspect each departmental data source and confirm its rules and data structures. Identify and resolve identity problems, duplicate record issues, data quality problems and other anomalies 
• Ascertain relationships among data
• Cleanse and standardize data 
• Consolidate the data into a single master file that can be accessed by all participating organizations
• Automatically apply and manage security protocols and data encryption to ensure accordance with privacy mandates

4) Advanced analytics and business intelligence.

High-performance analytics and business intelligence are the brains of the Big Data technology ecosystem, providing government centers of excellence with a comprehensive analytical tool set that leverages extensive statistical and data analysis capabilities. Through the use of complex algorithms, these platforms quickly process and deliver Big Data's insights. Functionality includes the ability to:

• Mine data to derive accurate analysis and insights for timely decision-making
• Create highly accurate predictive and descriptive analytical models Model, forecast and simulate business processes
• Apply advanced statistics to huge volumes of data 
• Build models that simulate complex, real-life systems

5) Data visualization. 

Data visualization tools are easy to use — often with point-and-click wizard-based interfaces — and they produce dazzling results. With simple user interfaces and tool sets, users of advanced business intelligence and visualization tools can easily:

• Develop queries, discover trends and insights
• Create compelling and dynamic dashboards, charts and other data visualizations 
• Visually explore all data, discover new patterns and publish reports to the Web and mobile devices 
• Integrate their work into a familiar Microsoft Office environment
   

6) Specialty analytics applications. 

Multiple analytics techniques can be combined to deliver insight into specialized areas such as:
Fraud, waste and abuse. By detecting sophisticated fraud, enterprises can stop fraud before payments are made, uncover organized fraud rings and gain a consolidated view of fraud risk.

Regulatory compliance. Analytics tools can help agencies quickly identify and monitor compliance risk factors, test various scenarios and models, predict investigation results, and reduce compliance risk and costs.

HR analytics. Hiring is critical to build capabilities quickly. Therefore it becomes important to hire employees who can meet its requirements and fit into its corporate culture. There in lies the challenge: "How to hire someone from outside - who has relevant knowledge needed in banking and who will fit in with the existing corporate culture." This challenge can be solved by using data analytics during the selection process.

Each BU will have several such tools and techniques that are important, but that can't be justified to create data silos. Breaking data silos, combined technology with analytics expertise, new organizational workflows and cultural changes to enable enterprise-wide data management.

Developing an Innovation Zone

Every business today wants to be innovative. Yet most companies fail to innovate. Having worked as R&D engineer in Silicon Valley - where I started my career and filed for my first patent, and a innovation coach, here is one the key point for building an innovative teams.

Innovative teams need market knowledge to be successful. Having just technical skills is not enough. Here are four key inputs innovative teams need.













1. Customer Insight 

Great innovative companies such as Intel, Hewlett Packard, EMC etc have developed multiple channels to get information about and from customers, and have built extensive knowledge sharing systems to distribute this information widely within the company. This enables teams to understand customer needs and that helps develop new products that delights customers.

Having deeper customer interactions also provides opportunities for customers to participate directly in the innovation process.

2. Global Network

Companies that leverage information from the large business ecosystem are always at an advantage. Organizations that build a global network have greater advantage. When we look at top 10 innovative companies - they have a global foot print with teams operating in all continents and many countries, they integrate these global sites with information sharing channels helping teams all over to innovate.

The global network extends to global partners in the business ecosystem. For example Intel works with Hewlett Packard, Dell, IBM, Lenevo, Microsoft and several hundreds of partners to collect information & knowledge from the ecosystem.

3. Future Foresight

Innovation does not happen without a need from the market. Understanding what customers will need in future. But getting to know what customers will need in future is not easy. Developing a future insight in extremely difficult. This is where global companies have an advantage.  Identifying tomorrow's market needs, opportunities and risks requires working with senior management to assess the strategic and tactical implications of trends, and sharing information throughout the organization. Company leadership then shares this vision of the future with the entire organization. Global teams then work on this insights to develop products for the future.

4. Innovation Organization

There is tremendous innovation potential residing in all employees. Companies that go to great lengths to hire intelligent employees and then they have to empower innovators. Innovative companies provide dedicated R&D budgets, invest in labs, and focuses on innovation.

Company leadership backs up an idea with money, resources and time to develop innovative products.

Closing thoughts

All successful companies have reached the top because of their innovation. There has been no shortcuts in innovation.

Innovation is essential for success, but not all innovative products will be successful. For example, Nokia invested in two different smart phone technologies - Symbian and MeeGo, and yet failed. While history will say Nokia as a leader who failed, history will always remember Nokia as an innovative company.

2017 - The year of Artificial Intelligence

Every leader in technology sector know that success in a very transient in nature. Even global giants - such as Kodak, Nokia, Blackberry, Motorola, IBM have become victims of rapid technological changes.

Rapid Innovation brings in rapid obsolescence. Technology is ever changing and companies need to invest continuously in R&D, to develop new products, technologies - just to stay relevant in this ever-changing world.

We are already seeing the early fruits of Artificial Intelligence. Google Car - A self driving car is clearly the flag bearer, and today several startups are working hard to make the self driving cars a standard. This new technology will make the current auto giants such as GM, VW, Toyota, Honda, Tata, obsolete. Taxi hailing companies such as Uber will be first ones to capitalize on this new technology. Together with self-driving cars and on-demand taxi service will change the way people look at owning an automobile.

While this is good for technology companies, this shift in marketplace will deal a death blow to auto industry, and millions of workers will lose their jobs.

Another sector where AI will bring a huge change is the world of IT services.

Today, several million people are employed in IT/BPO service sectors - who do just the basic first line or second line product support. Low cost communication technology moved these low skill jobs from US/Europe to India. But now, the lower cost of AI will eliminate several of these jobs altogether.

Apple's Siri & Facebook's chat bot are just the beginning, soon all e-commerce companies, product support organizations will move the first line support functions to computers which have cognitive system intelligence.

To win in this AI arms race, companies such as Microsoft, Google, Facebook, Tesla, Amazon etc are investing billions of dollars to develop new AI technologies. Companies that can master new AI technologies will be able to lower their operational costs, execute better and thus compete better and win new business. For example, AI enabled drones can speedup delivery for Amazon, thus reducing distribution costs. Customer support Bot will answer customer questions, etc,

Just like Internet drove the business in 1990's-2010, Artificial Intelligence will be the driver of the new smart world of 2020's.

IoT is about to change Human Behavior

Internet of Things (IoT) is no longer a futuristic science fiction stuff. It is here and is slowly but surely changing our lives. As the technology matures and the prevalence of connected devices increases, it will change our lives in several profound ways. IoT would have an impact greater than that of World Wide Web!

I would say IoT will be one of those things that will fundamentally change the way we live on this planet:

 - Just like our ability to harness fire put humans on path to civilization,
 - Just like our ability to read & write helped create complex civilizations,
 - Just like Newspaper and Telegram created a global economy,
 - Just like Internet & WWW created a knowledge economy,

IoT will fundamentally change the way humans live, behave & interact in the society.

Let illustrate this with an example.

Let's say there is a construction on a major highway in the city. One hundred years ago, information of this construction would be published in newspaper - which very few people would read, and the local administration would put up big hoarding all around the construction site - requesting commuters to take alternate routes, and a local policemen would manually redirect traffic.

Percentage of people who knew about the advisory - 5%
Percentage of people who heeded to the advisory - 1%

The rest 99% would still drive on the same path and get redirected by local police.

With the advent of Radio & television the situation did not change much. With better communication technology, more people were now aware of the construction, but did not know

Percentage of people who knew about the advisory: 20-30%
Percentage of people who heeded to the advisory:  1-5%

The rest 95-99% would still drive on the same path and get redirected by local police.

Internet and World Wide Web along with  Social Networking tools improved the level of awareness, but people would still pile up at the construction point and choke traffic, and we still needed police to redirect traffic.

Percentage of people who knew about the advisory: 50-80%
Percentage of people who heeded to the advisory:  5-10%

While we now have all the tools to send out information, we as humans still have limited capability to absorb information and act on it.  So even with instant communications, real time traffic map service and social networks, people behavior hardly changed.
Studies done on the aftermath of Hurricane Sandy and Katrina show that people now have awareness - but still do not act on those information!

But IoT is about to change this.

With the advent of GPS Navigation systems, users can now chart out their driving path so as to avoid the construction area. So with IoT,

Percentage of people who knew about the advisory: 100%
Percentage of people who heeded to the advisory:  50-80%

The next generation IoT does even bettwe, with the advent of self-driving cars, the information about road constructions will be consumed by the car and it will reroute its path to avoid construction site, thus avoiding unnecessary traffic jams and wasted time/fuel. Thus with second generation of IoT,

Percentage of people who knew about the advisory: 100%
Percentage of people who heeded to the advisory:  100%

First Generation of IoT

While IoT is no longer a futuristic pipe dream, the technology is still maturing. The  technology has evolved a lot ever since Simon Hackett and John Romkey operated a toaster via the Internet in 1990. Technology evolved quite a bit since then and today we have Smart thermostats such as Nest, or fridges which can display Tweets!

Today, there is much wider prevalence of connected devices - which collect lots of data from the surrounding environment. But these are essentially the first generation of IoT.

Collecting information and presenting information is just a proof of concept of what role IoT can play in our daily lives. Devices such as smart watches or Fit-bit bands can collect a whole lot of information on a person's daily activity. But it does very little to change the person's behavior.

Very few people can change their actions and behavior based on the information presented to them. I would say less than 1% of people changed their exercise pattern because of Smart Bands/watches.

First generation of IoT was all about collecting data. But data was not an end in itself.  Consumers are already overwhelmed by data. Some systems were able to present data in a meaningful way in form of actionable information for people to act. For example, smart baby monitors can alert parents when the baby's breathing pattern changes. But then all mothers are still very anxious and would not change their sleeping patterns - even after knowing that their baby us being safely and actively monitored.

First generation IoT did not make life better, rather it added tremendous complexity with yet another gadget that consumes attention and feeds our obsessive-compulsive disorders.

Smart products today still have big challenges in making users interact with the products and take actions.

The first generation IoT was still far away from creating meaningful experiences.

Second Generation of IoT

Second generation of IoT is just around the corner. Few systems are already being deployed and tried - but these are just the beginning. Smart systems today react to all the information coming from connected systems in a meaningful, purposeful ways.

For example, Smart insulin pumps can alter the quantities of Insulin being pumped into body based on real time blood sugar levels.

The second generation of IoT goes beyond collecting & presenting data. It has to simplify life through automation. Connected devices have to remove tedious chores from our daily lives, allowing people to concentrate on more important stuff.

Second generation of IoT has to provide the ability to control things automatically - which we otherwise would not. For example changing the building thermostat settings to match with power savings plans or based on real-time power supply data - when grid loads increase beyond a point, smart gird can tell all connect smart buildings to lower their power consumption. Smart buildings will then react to this request by changing the temperature & lighting settings.

The next big innovation in IoT will be to create user experience in ways that it makes lives richer by seamlessly eliminating mundane activities. One must create systems focused on meeting a conscious or an unconscious need. For example self driving cars - which meets the need for transport whenever without the hassle of driving.

Today, Airlines and aircraft's are using data from IoT to change the flight parameters to create better fuel efficiency and better passenger comfort - all without pilots actions.

Closing Thoughts

Developing this second generation IoT systems will certainly require a different ways of thinking. This also presents a tremendous opportunity to enhance human experience and enhance life in ways that were never possible before.

Smart systems must be able to understand our intentions and desires and then act independently to create those experiences. When IoT and Smart systems can take real time, meaningful action - without human interaction, IoT will become mainstream.

Second Generation of IoT will not be centered around the product. Instead, it will be centered around user experiences, while hiding all complexity of technology.  Second generation IoT does away with all the unnecessary interfaces and enable customer to concentrate on more important tasks. When IoT products (sensors, actuators), the network, the apps - will all work seemlessly - it will ehance the customer experience - without "Experience of the product"

How IoT will help Sustainability

Any one who has a car today will have experienced a traffic jam and once a while, while waiting in the traffic jam, there will be a thought: How to eliminate this traffic jam and help environment by better use of technology?

Several of today's startups are working on latest technology that may do just that.

In my previous post I had mentioned about How IoT is helping build sustainable buildings. But there is more to technology built on top of IoT which will profoundly change the way we live - and thus reduce energy consumption by increasing energy efficiency.

Cars are the BIGGEST users of energy today. It is no wonder, a lot of innovation and new technology is being developed to improve energy utilization in cars. Some of the innovations that we have already seen are:

1. Hybrid Cars that run on electric motors and fossil fuel engines
2. Electric Cars that can be charged from Solar panels
3. Uber's network of cars, where Internet connects the drivers to customers
4. Google's self driving cars

Now the stage is set for the next revolution:  A network of connected cars, connected buildings and smart traffic management systems.

The idea of self driving electric cars integrated with Uber like technology will enable commuters to share rides - thus eliminating waste. The idea of one person driving alone in a car will soon be history!

To enable such a system where self driving taxis can be hailed via smart phones will require lots of new technologies driven by IoT in form of Smart/Intelligent cars, Traffic monitoring systems on roads such as cameras, Vehicle speed detectors, Intelligent traffic monitoring and management via smart traffic lights, Smart parking spaces  & recharge points - which broadcast empty slots to self driving cars, Air quality & pollution monitoring and broadcasting system - which will guide hybrid cars to switch over to electric mode in polluted areas, Commute demand management systems - which will automatically determine the best possible commute options,  etc.

I am sure there will several other technologies that will emerge in the next decade.

On November 30th, amidst the backdrop of the COP21 Climate Change Conference in Paris,  a group of high-powered tech executives announced Monday the formation of the Breakthrough Energy Coalition and its intention to push investment to pioneering climate change technologies, there can be some real change in energy efficiency in the enterprise with technology available today.

IoT and the always connected network forms the backbone of this new technological breakthroughs - that will create build a sustainable world. IoT forms the eyes, ears & senses of this new technology, while the wireless networks from the interlinks that connects the people, the business and the cities together and provides relevant information for insights on what needs to be done to reduce energy consumption in real time.

Linking vehicles, commuter traffic and air emissions to air quality is giving traffic management the right data to manage for optimal efficiency: Reduce operational cost, greenhouse gas emissions and the environmental footprint.

The key value will come from raising the efficiency. Today people who drive their cars & big SUVs around normally use it for 5% of the time and at 20% of the capacity - i,e ~99% of all the available transport capacity in cars & automobiles are being wasted!

This will have to change and technology sector will drive this change to create a sustainable cities.

Similarly, almost 100% of sunlight falling on cities are being wasted! Developing more effective and efficient solar photo voltaic panels can eliminate the need for fossil fuels in cars.
New technology can change the way we consume energy and lead us to a path of greener and a sustainable future.

Closing Thoughts

Today, cars form the biggest polluters in the planet, and with new technology based on IoT and connected world and renewable energy, we can change the way we commute and this will help in a big way to reduce pollution and create a sustainable world. 

How Innovations in IoT & Smart Buildings are creating Sustainable Work Places

As Indian economy grows at 8%, the demand for new office spaces in big cities like Bangalore, Delhi, Mumbai etc. has increased exponentially. According to a study done by CBRE, 150 Million Square feet of new office space will be ready in 2017! Most of this office space will be consumed by IT & ITES companies.

Such a rapid growth in office space naturally leads to big increase in power consumption. It is therefore natural that reduction in energy usage has become a top priority for owners of commercial and industrial buildings to help save money and also save environment in the process.

Adding to the desire to save operation costs, government and non-government agencies are increasingly demanding compliance with IGBC (LEED) Green Building Standards. Examples include ASHRAE standard 90.1-2007 and ECBC 2008 and California's 2013 Title 24 Building Energy Efficiency Standards. In future several new, more stringent standards are likely to go into effect by 2020.

These changes in regulations implies that in future, businesses will need to implement technologies that enable highly energy efficient office spaces and factories and ultimately leading to zero-net-energy buildings - Office, Factory, or Warehouses.

To meet this challenge, several innovations are happening. Internet of Things (IoT) is the game changer and is enabling the revolution in managing energy requirements of buildings.

Some of the innovations include Smart LED Bulbs which can connect wirelessly to a central Building Management System - which monitors & controls the bulbs can lead to 70-80% of energy savings when compared to regular lighting. Smart sensors for Temperature, CO2, Humidity, Motion detectors help in optimizing air-conditioning, which leads to big power savings.

In short, the need to create sustainable buildings has led to a plethora of innovations in all aspects of building management. Building are now being equipped with intelligent networked systems for controlling and managing energy-related applications. Wireless networking removes a number of limitations, such as which devices (lighting, thermostats, plug-loads and CO2 sensors etc.) can be controlled.

Innovations in Building Lighting

Building lighting presents on the greatest opportunity for implementing energy savings and costs. Automated lighting control systems allow lights to be turned off or dimmed to accommodate time and usage factors, providing the correct amount of light where and when it's needed. These systems can reduce building energy consumption by 70 percent or more, and when combined with LED lighting, savings can top 90 percent.

Power saving from LED alone makes a strong business case to adapt LED lighting. But LED can offer several more advantages.

The new innovation in LED lights is Li-Fi. A new light based Internet connection system that will replace Wi-Fi. Light based data transmission can transfer data at 224 gigabits per sec!  Even at 1 Gbps, it is 100 times faster than Wi-Fi.

Smart lighting will provide several other benefits such as enhanced comfort to occupants, improved operational efficiencies and very fast Internet connectivity. Since the available bandwidth on Li-Fi is in several Gbps, one can create a mesh architecture where each Smart light device can connect to other devices and data  is passed through the wireless network from device to device. New technologies such as Li-Fi will eliminate the need for data wiring. The savings from eliminating wiring alone is an incentive enough for many building owners to make the move to Li-Fi systems.

Innovation in Smart HVAC Systems 

Building heating & cooling is a big consumer of energy in office buildings and optimizing it with smart sensors and smarts controllers will save operational costs.

Humidity, CO2 and temperature significantly affect personal health and comfort; thus measuring humidity and temperature in this context and reacting to the changes can improve personal well-being. Applications include temperature control, humidity control and quality of air.

Smart HVAC systems can sense the various air quality parameters inside the building and can change and control it automatically and efficiently. Smart HVAC systems use sensors that distributed across the building and have VAV fans to control the ventilation system to achieve optimal ventilation. And temperature control.

Measurement of humidity and temperature can help optimize processes and thus save energy and costs. Applications include automotive engine control, smart condensation control for refrigerators and optimization of A/C cooling cycles.

Smart Temperature Sensors will enable several levels of automation. Knowing the hot & cold zones in the building from the sensors will enable HVAC controllers to direct cold air via VAV fans to the required regions and avoid cooling/heating the entire building. Such systems can reduce energy consumption by as much as 25%.

Innovation in Elevator Control & Management

A bank of Elevators have become a mandatory feature in all office buildings. All elevators have a common feature - it annoys users in several ways. Firstly it makes people wait. Secondly it is impossible to know which elevator will take you to the desired floor quickly. Often we see one elevator being filled to capacity and the next elevator going empty.

Occasionally it make people happy when the elevator goes nonstop to the desired floor.

Smart Elevators are going to change this. Some of the new innovation in Elevator control and management. Instead of choosing the floor to stop after entering an elevator, users will have to enter their destination floor on a common keypad set at the bank of elevators.

The smart elevator management system instantly assigns the user to the elevator that will get him most quickly to the desired floor. Knowing how many people have similar destination allows for clustering of people into a common elevator. This allows elevators skip floors and minimizing stops. It also prevents random cramming into the first available elevator.

Another innovation in elevator management is use the information embedded in employee smart badges which reads the floor details and even eliminate the need to press buttons!

When elevator management system is integrated to motion sensors, it can automatically shutdown elevators when there are less number of people and turn them on when number of users increase.

Smart Elevators not only gets the users with less waiting, but the system saves energy and equipment wear by minimizing empty trips. Smart elevators also enhance user comfort by reducing waiting time and enhance user experience!

Innovation in Water Efficiency

Water is fast becoming one of the scarce resource all over the world. In India, we are already seeing critical water shortages. It may be our most precious resource. Where alternatives exist for energy sources, but there are no alternatives to water. It therefore makes sense to look at innovative solution to improve water management and improve water efficiency.

Office buildings require large amounts of water for Landscaping, HVAC chillers, toilets and taps/faucets. Water also has a direct connection to energy use. Every gallon or liter of water used may require some pumping or treatment which uses energy. Reducing potable water uses reduces energy consumption.

In most office buildings, monitoring and management of water is generally pathetic. How many facility managers can monitor and manage real-time water use in their buildings? Water is often seen as cheap and limitless resource.

Office buildings have two main needs for water. One is the plumbing system within the building and the other is the irrigation system for the building's landscape.

Green Building codes in form of USGBC LEED Certification in US or IGBC Certification in India, have defined building codes that specifies the type of fixtures, water recycling requirements, usage of recycled/reclaimed water and water metering systems.

For real savings in water usage, one must use smart technologies such as smart water meters which can detect leakage and alert facility management. Smart meters can record water usage for specific areas and generate reports & alerts when the usage pattern changes or crosses set thresholds.

Smart irrigation control systems can take inputs from weather monitors, timers and soil moisture sensors and then regulate the amount of water used for landscaping or irrigation.

Smart water management systems that monitors and manages water usage that will change the process from simply supplying water to managing the demand for water - thus saving water and reducing costs.

Innovations in Building Management Systems

Buildings today use complex systems. Each component inside a building has been developed and improved, allowing modern-day building owners to select lighting, security, heating, ventilation and air conditioning systems independently.

For real savings, buildings must connect the various pieces in an integrated, dynamic and functional way. Smart building management systems will seamlessly integrate disparate systems while minimizing energy cost, supporting a robust electric grid and mitigating environmental impact.

At the most fundamental level, smart buildings deliver useful building services that make occupants productive (e.g. illumination, thermal comfort, air quality, physical security, sanitation, and many more) at the lowest cost and environmental impact over the building life cycle.

Today, Building Management Systems aggregate all data sources and data analysis tools can generate previously unattainable insights in real time.

For example, building management systems monitor multiple HVAC systems and detect performance anomalies. When HVAC systems in the campus have different power consumption - then the BMS will flag this alerting maintenance crew to find & fix the issue.

Smart building management system looks beyond the equipment and uses data from each system (Lighting, HVAC, Security, water meters etc.) to optimize total building performance. It allows buildings to be responsive to smart power grid and interacts with building operators to empower them with new levels of visibility and actionable information.

Imagine predicting when equipment is about to break down. Imagine having clarity into which retrofits can get you the highest ROI, before any project has even started. Imagine automating your lights so that when you are approaching peak demand, they dim automatically. Holistic building data analysis are at the heart of the hidden insights which were previously impossible to find.

Smart Technologies are more valuable when they are connected.  Data is meaningful only when it is holistic. Siloed data causes more harm than good. That's why smart building management systems connect various systems, thus enabling completely automated buildings that enhance user comfort and productivity and lower costs in the process.

Closing Thoughts 

Today, new building management software systems can collect data, organizing it, normalizing it and highlighting actionable insights which are then used to identify, quantify, implement and verify efficiency improvements.

At the heart of smart buildings lies IoT. A set of connected smart objects that create a powerful impact on how people interact with their environment.

Innovations in IoT is driving Smart buildings which not only improve energy & cost efficiency, but also increase the productivity of people working in those buildings. Data collected from smart systems helps architects and construction engineers to build better and smarter buildings that leads to real saving and create less impact on environment.  

Product Leadership - Building Successful & Innovative Products

One can learn good management theory and principles in MBA colleges. One can learn creativity and design in design institutes. But no one teaches how to create successful products!

Creating successful new products requires a right marriage of right brain thinking:  creativity/design, and left brain thinking: Process, science/maths, rational management. Apple Inc. is a perfect example of left brain right brain thinking - Jonathan Ive the designer and Tim Cook, the operations manager. Steve Jobs the business leader.

Every company that develops new products needs product leaders managers who can get the right balance between creative people and managers to create successful products.

Product leader has to bring in few tricks: "Design thinking" and "Lean Development"  techniques to rapidly experiment with solutions.

The secret for success in new product development is to understand that developing new products is not much about product development! Instead, it is all about creating customers!

Creating customers is all about understanding customer needs, desires, & problems, and solving it profitably. If the number of customers are large enough, then you have created a successful product.

Since there is a very high level of uncertainty in creating new customers, one needs to be agile & lean when it comes to trying out new designs - i.e, ability to move/change/adopt quickly. Since things are at flux and needs are constantly changing one has to be lean - i.e., use minimal resources for experimentation.

Startups generally are good at new product development - mainly because they are not focusing on sustaining customers. They are creating new customers. They have few resources & are forced to be lean and they are agile. Enabled with rapid decision making leadership, who is not afraid to experiment or fail, Startups are constantly figuring out how to create a customer.

I always say "Without a customer, you don't have a product. You only have a prototype!"

I have worked in startups and have seem several other start ups and established companies follow a similar process towards new product development. Often

Step 1: Develop an Insight: 
Identify what the market needs or desires. Start with talking to customers, question customers current levels of comfort & needs. Observe customers and learn. Network with similar minded people. Also be ready for surprises. Lastly experiment - to get deeper insights about problems that is worth solving.

Step 2: Define the Problem: 
To develop a successful product, one needs to know what is the real problem that needs to be solved. Competition could also have the same insight - but had failed, because they did not solve the right problem.  Discover the customers' need or problem first, and then make sure you are going after a problem worth solving.

Step 3: Solution: 
Develop a prototype first. Check if the prototype meets the minimum requirement in terms of solving the customer problem. Practice agile & lean principles to rapidly develop prototypes - instead of developing full scale products. If needed, develop multiple prototypes, each to solve many aspects of customer problem. Iterate until you develop an awesome product - the one that delights customers.

Step 4: Develop Business Model: 
The finally solution must be priced to market. Carefully examine the entire cost structures, validate go-to-market strategy. If the need be, one has be creative in pricing the product. A differentiated pricing strategy that makes it easier for customer to acquire the product.

Closing Thoughts

Product Leaders must push the design and management teams to go beyond the obvious. Force the team to Think differently or experiment. Accept failures during prototype stage - and fail fast. Once a failure is identified, pull out the product and iterate until the product succeeds.

Leaders must embrace uncertainty in the product development, Challenge the problem statement until every stakeholder is convinced of the problem, Set a high pace for development, and be bold in experimentation.

Role of Customer in New Product Development

In my previous article: First Steps in Developing New Software products,  I had made a reference to a stage of defining product features. There are many ways to identify product features and functionality. One of the ways is to involve a potential customer in the early stage of new product development.

The key advantage of involving customers at an early stage is to minimize the risk of developing features & functions - which are of no value to customers. It also helps in taking active customer feedback at the time of product definition and that helps in a BIG way to minimize risks of product failure.

Improve the Odds By working with the Customer

I had good fortune to work at both a large technology company in Santa Clara, and also at a startup and also in a very large technology company. All through my experience, I have been involved in product development, from both technology side and business side. Based on my experience, I seen the value of customer involvement at an early stage of product definition.

Normally, all new product development goes through cycles of  "IDEA" -> "Build Product" -> "Measure Customer Response" -> "Learn from Customer Data" -> "New Idea".

Involving customers at an early stage of product development has several benefits.

1. It will help avoid mistakes and it allows the developer to explore and iterate during the cheapest phase of development - before any code is written, and when the product is still in the mockup stage. Customers can give valuable inputs and validates the initial assumptions.
2. It also gives a clearer picture of  customer needs and competitive alternatives. Talking to customer gives a much deeper insight into actual customer usage models and needs - there are invaluable for defining new product features/functions. In my past experience, we had a case where got so impressed with the product idea that they were willing to invest and co-develop the product. Customer, being a Fortune-500 company, thus ensured the product was an overnight success.
3. It also helps to uncover new opportunities for differentiation from competition, and helps in clear market positioning and helps develop the product launch, and product marketing plans.
4. It will reduce or eliminate unnecessary features, thus it will reduce the amount of product that needed to be built, and speeds up time to market!
5. It is always better to be first in the market - even with minimum viable product. This reduces cost of development and time to market.

Customers are eager to help 

It is surprising to know that most customers are eager to help and talk about their needs - even to companions that don't even have a product.

During my interactions with customers, I have noticed that customer often tend to request features that are far more ambitious than their current needs and usage, but are willing to accept a product that meets their minimum needs.  As a result, we were able to release new product in months - and without many features which was initially planned.

Customer are also willing to give time for additional features - which helps in product road map definition. Just asking for customer priority of features helps in identifying the time scales for subsequent product releases and this also helps shape the future direction of the product.

Customer Involvement is actually an opportunity to build stronger relationships with some of our customers. We'll choose those most likely to be receptive, and we'll set expectations appropriately.

However, customer involvement does not mean building a custom product - which meets the needs of only one customer.  Its a process for gathering information, and it will require a skilled product manager to prioritize that information and figure out what and how we respond to it - and help product management do their jobs more effectively.

Customer involvement gives information on how individual customers behave and buy. This type of insights cannot be captured from market research or from usability testing. Market research and usability testing are still very imprint and customer involvement does not eliminate it.

Customer involvement is the best way to validate assumptions on who the customer is, what he needs and what he'll buy.

Facebook's 6-Pack Punch

When a billion+ users log on to an Internet service, the underlying fundamental principles of a datacenter has to change. The traditional datacenter was designed to serve thousands of users that can scale upto a million users - but not in Billions!!

Facebook engineers have learnt what it takes to run datacenters that serve billions of users and are Open Compute Foundation.
kind enough to share that knowledge with rest of the world - via


As part of Open Compute Foundation, Facebook recently revealed "6-pack": The first open hardware modular switch. Its a scalable solution - with modular design.

6-Pack is a top-of-the-rack switch, commonly used in "Leaf-Spine" networks for large datacenters. In Leaf-spine network, a rack full of servers are connected to every other rack via a Leaf-Spine network.

6-Pack is also an "open design" Facebook will allow other companies to manufacture and sell these devices. The switch is built from off-the-shelf component & not custom built AISCs - thus bringing down the cost (in a big way) of networking.

6-Pack can scale from 32 ports of 40Gig Ethernet to 128 ports of 40Gig Ethernet - providing a total bandwidth of 1.28T!  It supports two fabric cards, and eight linecards (called as Wedge). Each line card has 16 40GigE ports.

It packs enough punch to change the bedrock of the Internet - the datacenter switches.

For full technical details see: Introducing "6-pack"

Innovation

From a pure switching technology perspective, the 6-pack is not that innovative. The modular & scalable design, the 40GigE ports and fabric cards have been around for years. Cisco Nexus series, Juniper EX series & Arista are established leaders in this space.

In terms of performance, reading from the specs of the device, (I have not seen any real performance numbers) Facebook's 6-pack is on par with the top-of-the-line offerings from Cisco or Arista or Juniper.

The main innovation comes in the internal design. Each line card has a micro-server and a server inside. A Linux derivative Operating System (code-named "FBOSS") drives each of the module.

Each element runs its own FBOSS on the local server and is completely independent.

Herein lies the major Technical innovation. The server inside the linecard and fabric - runs all the network control functions and the switch can be managed as a server - i.,e provisioned & configured using existing server management tools.

Note: No separate/special network management tools needed. 6-Pack/FBOSS does not use SDN technology - like virtual network overlay, but its a hybrid SDN - where all the network switching intelligence is built into the sever.

Running each module independently, allows network engineers to modify any part of the system with no system-level impact, software or hardware. It has a unique dual backplane solution that enabled us to create a non-blocking topology.

Business Disrupter

The other major Innovation with 6-pack is its "Open-design", thus allowing any 'grey-box' manufacturer to build and sell these high performance switches. The open design, Open OS, and off-the-shelf components all comes together to reduce the costs drastically.

6-Pack is a great value proposition for Cloud service providers. Who, like Facebook, run massive datacenters that server millions and millions of users. Unlike Enterprise class switches from Cisco or Arista - which costs $600/port (approx),  Facebook's 6-pack will cost a small fraction - $90 or even less (my estimate) and will reduce further with time.

Since the networking intelligence is built into the software running on a server, the expensive proprietorial protocols and custom built switches can be replaced by 6-pack!

Limitations

Note that Facebook built 6-Pack to meet its needs and not enterprise needs. This means that 6-pack is designed to work with web based service workloads and not the traditional enterprise workloads. Even for the large enterprises, the savings from lower cost/port will be offset by higher cost of integration with existing tools/frameworks, and lack support of support for Open Compute.

This implies that enterprises who do not run 100,000's of identical servers and will not require the scale and flexibility of 6-Pack. Such customers are better off with switches from Cisco or Juniper or Arista or others. But for service providers: AWS, AT&T, BT, Colt, VMWare AirCloud, CSC, etc., Facebook's 6-Pack is a game changer.

Software Innovation Ecosystem

Innovation may be broadly defined as the successful commercial introduction of a new product, service or process. In general terms, Innovation refers to the implementation of New products (or processes) that as significant technological improvements to the outputs of the products (or processes).

Often times, software innovation involves technological innovation and process innovation.   Technological innovation involves a series of scientific and technological improvements. While process innovation involves a series of  organizational, financial and commercial activities.

It is important in this context to note that software R&D must look at both aspects of innovation.

In software, incremental innovation is most common. Incremental innovation is often seen as development of a new feature or new functional aspects or new application of an existing software product or improvement to the previous generation of the software product.

Innovation Ecosystems

Today, software innovation relies on several players:

1. Companies that develop commercial software.
2. Organization that develop free/open-source software.
3. Companies that develop Compute & Communication hardware.
4. Companies that develop Information communication technologies & hardware.
5. Companies that develop hardware-software integration.
6. Companies that develop IT services.
7. Companies that provide services based on Information Technologies.
8. Companies that finance purchases of software or hardware of compute & communication technologies.
9. Companies that own & license patents.
10. Government & regulatory agencies.

Today innovation in software sector is often characterized by participation of a wide range of companies listed above. The complexity of the interactions between different players add to challenge of innovation.  Many companies in the ecosystem operate beyond the norms of software development and often complement software products. Understanding the ecosystem forms the foundation to software process innovation.

The technological convergence between hardware, software and telecommunication technologies lead to product innovation - where technology synergy and interdependence across different technologies drives product innovation.

In short, software innovation today needs a greater level of collaboration across multiple players in different segments of the ecosystem.

As a result of this ecosystem, software innovation is getting concentrated in areas/cities that has a conducive environment for collaboration. 

Rise of Anti-Social Apps & Limits of Social Networking

Smart phones have indeed made people smarter. Right now, there are millions of Smartphone users who are worried about their loss of privacy.

On one hand Smart Phones gave users tremendous power to communicate with anybody in real time - via social networks. Social Networking Apps such as Facebook & Twitter gained immensely from this. But with passage of time, users are slowly understanding the "dark" power of social networks: Loss of privacy. Some people found it the hard way - when they were not getting hired - because of some "party pictures" in the social network, or a comment.

The social networks help people connect and communicate, but it also remembers all communications forever, and all communications are instantly made public!  This leads to loss of privacy.

Smart phones today have built-in GPS and it can imbed all the locational information in photos, videos, messages etc. Cell phone service provider can track the location of each smart phone using the GPS or by triangulation. In extreme cases, malacious software can be added to the phone which can record all conversations/communication and send to a predetermined location without the knowledge of the user!

Its no wonder that people are now abandoning social networks. Many users whom I know are not posting anything on their network and the volume of activity in my social network has dropped by nearly 90% from its peak two years ago. In other words, we have seen the high tide mark of Social Networking.

As users became more aware of the disadvantages of Facebook & Twitter, they switched over to apps such as Snapchat & Whatsapp or LiveChat, etc.  These apps allow discreet communications.

Secrecy has its advantages for people and It's quite attractive. These niche apps were being developed to capture some of few remaining untapped social-media markets.

Now, a  new trend of Apps are coming: The "Anti-Social Apps." While most social networks aim to connect people, one new service seeks to join the growing trend of doing the opposite and help you avoid them.

Some of the new Apps in this category are:

Cloak: 

Cloak 'anti-social' app helps you avoid your friends. Cloak uses location information from other social networks (FourSquare and Instagram at the moment) to work out where your friends are. It then informs you via push notifications so you can avoid anyone you'd prefer not to see. Users can choose to receive an alert when certain people are believed to be nearby.  You can also view friends on a map or on a detailed list telling you how close they are, to the nearest mile. It's free and currently available on IoS.

Snapchat:
Snapchat is used to send pictures and videos - which is automatically deleted seconds after they have been viewed.  This is opposite to that of Facebook, which keeps the photos/videos forever and for everyone to see.

Secret: 
Secret broadcasts messages anonymously - are growing in popularity. Using Secret, one can share a confession with your network (in practice, those of your contacts who also have the app), though they won't know it was shared by you. You must have a minimum of three friends before you start sharing (in order to protect your secrets). In theory, secrets that are liked and reshared can spread across the world — though the app's developers insist you won't be identified at any point. Posts are encrypted so that the Secret team doesn't know what you're sharing.

Whisper: 
Whisper, like Secret enables users to share secrets. One can also respond to other Whispers with your own, and there is a private messaging app if you long to live in a riddle wrapped in a mystery inside an enigma. You can browse by topic, so you can quell your conscience by unearthing others who have cheated on the other halves/shoplifted something/failed to give up their seat on the Tube.  It's free and available on IoS.

Closing Thoughts 

Today's young generation are done with sharing and uploading nearly every part of their lives. Instead, intimacy and privacy in the digital age is now what they seemingly seek. Constantly being connected to the world was cool way back when, but this constant connection has created lots of problems and people are fleeing from it.

Next Technology Disruptor: Internet of Things

2014 is the year when Internet of Things becomes are reality & it will start disrupting the tech industry

2014 is shaping up to be interesting year in the tech industry. Several new & exciting technologies are being introduced. The main focus this year is to move mobile smart devices beyond the cell phone space - and create exciting new products:

1. Smart Watches:  Samsung Gear & Gear-2 NEO. 
2. Smart bands: Nike Smart Band, Hauwei Talkband, GoQii
3. Smart Glasses: Google Glass, Vuzix M100, Epson Moverio BT-200 
4. Android in Cars: Open Automotive Alliance, OpenXC 
5. Home Monitoring: Nest Thermostat.
6. Subscriber Identity Module: Nymi acts as a digital vault and password holder.
7. Industry Appliances

The term "Internet of things" emerged as a buzzword over the last year or so to describe the phenomenon of network-connected devices, such as thermostats, that in the past were simple standalone appliances.

The phrase "Internet of things" stands for devices that can be connected wirelessly to Internet and other compute devices - such as phones or tablets or directly to Internet Cloud.

These new connected devices is a gold mine for Telecom companies, car manufacturers, software/App vendors and networking equipment makers. But this new technology can also disrupt their existing business.

The writing on the wall for tech companies is clear: The Internet of things is coming, and you better disrupt or prepare to be disrupted.

The number of these smart & connected devices will grow rapidly and is expected to reach 500 billion or more by the end of the decade. When we think about such large number of connected devices generating huge volumes of data - it will change the very nature of technology industry.

The financial rewards of this new technology is huge. It will touch every aspect of our lives and disrupt every single industry we know of - just like Internet did 25 years ago.

To understand how this Internet of Things can change things, consider the game of basketball. Sensors on the player's shoes can tell how well the players are performing and help coaches plan a better game - by using real time analysis of player & ball movements.

GoQii can change how professional athletes train. GoQii can capture all the movements, exercise, heart rates, calories burnt, sleep patterns etc and feed that information to a real time analysis systems that can help players & coaches plan better.

The possibilities to change things are endless. Successful companies will have to built easy-to-use, high value apps and that will happen over time.

And there are dangers as well. Loss of privacy, digital identity theft and ever widening of the digital divide are the biggest risks. Legal systems must evolve to deal with this new everything-connected world.

Companies around the world are still grappling on how to take advantage of this new technology and many will perish, while several new ones will emerge.

Closing Thoughts

The benefits are so massive that it is inevitable that Internet of Things will be everywhere. By connecting devices over the Internet/Wireless over mobile networks, companies can manage a wide range of new services for their customers.

Leading companies are not waiting for market to emerge. Google paid $3 Billion for Nest's Smart Thermostat technology! Soon others will follow with big money and explore new opportunities.

As the devices get smaller and smarter, as well as the circuitry that drives them, we will have more products that integrate into our life. Soon the question will not be: Whether you're wearing a piece of smart tech, but why not?

Internet of Things is now the new gold rush for this decade!

Also see:

Mobile+Cloud is the Next Big Thing

Mobile+Cloud is the Next Big Thing

Last week, I bought a Lenevo Smartphone for my mother. It costed less than $100 (In India, we pay the full price for the handsets and there are no carriers subsidies)

The new phone comes with 16GB memory, 1 GB RAM, HD display, Andriod 4.3 Jellybean 16GB Flash, 5MP Camera, etc. In short the new phone is saturated with features and can do pretty much everything one can do with a high end iPhone.

Today, Smartphones and tablets are powerful enough to run applications that was once found only on a PC. The Network & Internet is everywhere. With 4G, Smartphones can download faster than most DSL services.

As hardware capability on a mobile platform matures to point where the next big innovation will happen in software. Some of this software innovation will be on the device - but big part of this innovation will be in the cloud.

Service providers and Startups and innovators are looking at means to make smartphones more useful and more valuable to customers. The revenue/customer from traditional phone services: Calls, SMS, & Data is declining and the value is shifting to the Apps. Dropbox is currently valued at $10Billion, Facebook spent $19B for WhatsApp! This acquisition is primarily driven by the potential value in the Apps - and not in the cellphone service.

Going by valuation alone, the total value of App companies is more than the combined value of phone companies!

As this shift happens, the use of cloud by mobile Apps will accelerate and create a new wave of innovation.

Types of Mobile Apps

As mobile phones evolved, mobile apps have also evolved and the apps can be classified broadly into 3 categories:

1. Generation-1 App: Basic Phone Apps
Application uses only the phone resources. These applications are tightly tied to the phone. Eg: iWork suite.

2. Generation-2 App: Web Applications. 
The Phone apps is a rehashed version of the web application. Eg: Facebook, Gmail, etc. The same application can be accessed on a PC or on a smartphone.

3. Generation-3 App: Cloud Apps. 
Cloud Apps leverage the compute & storage capabilities of the cloud and little phone resources to deliver unique experiences to users. For eg: Dropbox, Snapchat, Mobile gaming, etc.

Today, Mobile devices like smartphones and tablets are becoming devices to access cloud resources. As the trend catches on, the use of cloud by mobile applications will be the leading use of cloud computing, surpassing personal computers. And as that happens development of new and innovative applications - which will enable users to exploit cloud computing in multiple ways.

This shift is happening as we speak. Phone service providers and transforming into cloud service providers. Some carriers are moving the base station functionality from the cell site to a cloud data center. These cloud datacenters allow phone service providers with tremendous compute capability and that capability can now be used by new Gen-3 Apps.

For example, how about getting real time traffic & weather information on the route you are travelling on your mobile. Say for example alerting you of a traffic jam 400 meters ahead!
Another example could be relaying information about the best deals in a shopping mall to users based on user preference etc.

Phone Service providers and Cloud service providers can offer new Apps - that can give real time information to users. Cloud computing capability provides huge number crunching capability to process Big data, and end users can consume this results from their mobile phones - in new and unique ways.
For example, creating a mashup of Airline travel information and weather information can help a local taxi driver get more business.

Mobile network and phones will be rapidly commoditized in the cloud era, Forcing service providers to innovate and become platform providers or application providers.

For example, a user can create a document on a table using iWork & have the cloud services to get the document processed for publication. Proof reading, Editing, reformatting, Translating etc., can be done either by machines or humans or a mix of both - all enabled by the cloud, and finally published in the cloud.

Closing Thoughts 

The growth of mobile technology has clearly changed our lives. As mobile platforms mature, and cloud infrastructure evolves, the use of cloud computing through mobiles will increase and have a much bigger and deeper impact on our lives.

Phone service providers and application providers will have to innovate on developing new tools and capabilities - which will allow users to develop new and unique apps.