After SAPPHIRE NOW in June, a burning question remained: How does SAP’s professional services organization fit into the company’s new intelligent enterprise vision? SAP’s Digital Business Services (DBS) Analyst Day provided the answer: DBS is the enabler to the intelligent enterprise, which is a system of SAP and non-SAP applications, underpinned by a digital platform and made intelligent by the SAP Leonardo technologies.

As the enabler, DBS will have several responsibilities including helping to create business cases, and road map, architect and implement the customers’ version of the intelligent enterprise. SAP certainly has the technical expertise in-house to architect and implement the intelligent enterprise and has reskilled and hired over the last few years to bolster its advisory capabilities, particularly as it relates to emerging technologies such as artificial intelligence. Critically, SAP’s partners have ample opportunity around the necessary change management responsibilities that are undoubtedly needed to ensure successful business process transformations.

Repeatedly during the two-day event SAP leaders emphasized that DBS helps the company accelerate clients’ time to value and reduces risk for all involved — the client, SAP, and any consultancy or SI partners. By being close to software-related services, not necessarily project-related, such as change management, SAP DBS plays to its core strengths and competencies and brings the value clients expect. More broadly, DBS assures clients that a large partner-led engagement meets SAP standards, often through a separate SAP Value Assurance contract between SAP and the client apart from the partner or project arrangements. This clear vision of what DBS does well, why, and how built on last year’s DBS Analyst Day, particularly when reinforced consistently by the DBS leadership team.

Artificial intelligence (AI) technologies continue to progress, with vendors increasingly embedding machine learning capabilities into enterprise applications and consumers coming to expect a level of personalized, yet automated, interaction that only AI can deliver at scale. Discussions around the potential hazards of AI to brand reputations, personal data protection, constitutional freedoms and society at large have become commonplace, but this has not slowed the pace of technological advancement. While AI technology vendors continue to lead and engage in these discussions (especially when their own reputations and research investments are at risk), ultimately, organizations that incorporate AI tools into business decisions and automated processes will be responsible for the impacts of those technologies.

If the 2018 O’Reilly Artificial Intelligence Conference made anything clear, it was that as AI adoption grows, so does the technology’s complexity, particularly at the intersection points between humans and machines and between regulatory policy and technological innovation. This should sustain professional services opportunities for vendors that can stay on top of AI technology developments while maintaining a broader perspective on the impact of AI on clients’ business processes and HR strategies. Still, many questions remain unanswered, including how to manage security and governance over the massive autonomous systems that will be coming online in the next several years; whether the approach taken by the European Union with its General Data Protection Regulation (GDPR) will become the global standard; and what the long-term impact on human intelligence and skills will be as machines take over more tasks. It is unlikely these issues will be resolved by the 2019, or even 2020, O’Reilly Artificial Intelligence Conference, but vendors can start to address some of these questions with clients through consulting and solution design engagements tied to broader digital transformation initiatives.

Event overview

TBR attended business and technology learning content company O’Reilly Media’s third O’Reilly Artificial Intelligence Conference, an event centered on a variety of AI topics, including enterprise use cases, implementation, business and societal impacts, product design, and machine learning methodologies, over two days in New York. The conference’s theme, “Putting AI to Work,” mirrored that of last year, but sessions and discussions reflected growing maturity in how enterprises and researchers approach, develop and apply AI technologies. Keynote speakers represented AI technology vendors such as Intel AI (the conference’s co-presenter, as announced last year), Google, IBM Watson, Microsoft (Nasdaq: MSFT), Amazon Web Services, SAS, Digitate and Uber, as well as research institutions such as MIT, Princeton and Carnegie Mellon. In addition to tactical sessions around specific AI use cases designed for data scientists and software engineers that were abundant last year, new in 2018 was the AI Business Summit track tailored for executives, business leaders and strategists (and for TBR’s lead analyst covering professional services related to AI, analytics and digital transformation). TBR also interacted one-on-one with founders, product leads and marketing executives from AI-related startups such as Alegion, Kinetica, Clusterone and Dataiku throughout the conference.

A new generation of incredibly powerful, flexible and responsive businesses is reshaping markets. Their ability to serve single customers at scale is what TBR terms the “Business of One.” The environmental forces triggering this shift are vast. Information velocity accelerates globally; digital information expands exponentially; competitive advantage windows compress rapidly; task work automates; acute labor shortages persist in new skill work; and new business risks pressure public policy. In the aggregate this confluence of technology-enabled business factors disrupts traditional business, education and public policy best practices. Technology vendor and enterprise business models must evolve, as evidenced by the market capitalizations of relatively new businesses such as Facebook, Amazon, Apple, Netflix and Google (FAANG) while more established firms have languished. In the Business of One era, success will rest upon rapid iterations rather than deliberate cadences, ecosystem participation for assembling complementary assets rather than amassing scale advantage, subscription monetization cycles rather than transactional product sales, and highly automated processes and customer access points rather than labor-intensive task work and repetitive, overlapping paper trails to establish commercial trust.

Lack of ubiquitous interoperability a lingering vexation in the healthcare sector

TBR believes the pace of health IT innovations will continue, and even accelerate, especially as value-based care takes hold of the healthcare sector. However, full realization of the benefits of new healthcare technologies will continue to be deferred until we have, according to the Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma in her conference remarks, “a healthcare ecosystem where data flows freely.” In the same forum at HIMSS18, White House Senior Advisor Jared Kushner added that “even with the most advanced military on Earth, the U.S. still struggles to exchange records between the DoD [Department of Defense] and VA [Department of Veterans Affairs].”

Dr. Jon White, deputy national coordinator for Health Information at the U.S. Department of Health and Human Services (HHS) Office of the National Coordinator (ONC), highlighted the challenges of enforcing regulatory rules designed to prevent data blocking during the HIMSS18 Compliance Symposium. While healthcare organizations that do not share patient information as required may face fiduciary penalties, White acknowledged that his agency has yet to comprehensively define what constitutes information or data blocking. He also described other complications stemming from fees associated with connecting health IT infrastructures and the proper reading of Health Insurance Portability and Accountability Act of 1996 (HIPAA) regulations. Even beyond these challenges, White noted that some healthcare organizations as “an out-and-out business practice,” still refuse to share data, despite the risks of fines or other consequences.

Also during the HIMSS18 Compliance Symposium, Ken Mortensen, data protection officer for InterSystems, made a tacit admission that healthcare organizations may continue to block data sharing with impunity, provided they can sufficiently “explain the rationale behind their actions” if and when they are accused of information blocking and subsequently audited by the Office of the Inspector General (OIG). TBR believes this sets a troubling precedent that may shift the focus of healthcare organizations in favor of governance versus care delivery, at least in terms of crafting satisfactory practices, policies and accounts of internal activities to indemnify against potential audits.

The 2018 Healthcare Information and Management Systems Society Annual Conference & Exhibition (HIMSS18) took place at The Sands Expo Convention Center in Las Vegas. The 2018 event was the largest yet, with nearly 44,000 attendees, over 300 educational sessions, and over 1,350 vendors demonstrating their healthcare IT solutions.

Nine floors filled with experts, emerging technologies, partners and clients, all centered on a simple formula: innovation, intelligence and industry, plus rotation to the new while developing new skills.

Counting down to today; investing in tomorrow

A bit of history: Five years ago, Accenture dedicated its Bangalore assets to delivery, focusing on quality, productivity and lowering clients’ (and Accenture’s) costs. Four years ago, the company announced a “rotation to the new,” partially in response to a confusing world of emerging technologies. Three years ago, Accenture’s expectations for the future included everything becoming liquid, intelligent and connected. Last summer, the Bangalore Innovation Hub became an advanced technology center, focused on innovation, intelligence and industry. According to Accenture Technology Group Chief Executive Bhaskar Ghosh, expectations have become reality as Accenture, under one roof, combines those three elements with emerging technologies and a newly skilled workforce. The company invested more than $3 billion in fiscal year 2017 — in training, acquisitions and assets/IP — and will continue to invest this year to build further, cementing its market leader position.

One notable exception to nearly every innovation/experience/collaboration center TBR has visited over the last two years: Accenture has devoted two floors in Bangalore to technology partners, with dedicated professionals and space marked specifically for SAP, Oracle and Microsoft, three partners TBR highlighted in its October 2017 coverage of Accenture: “As Accenture strives to generate a vast majority of its sales from in ‘the new,’ a profitable relationship with the Big Three will be critical to success.” While unmistakably an Accenture facility — no client could be confused about where they are, even when seeing SAP- or Oracle-centric solutions — the investment in resources and physical space to technology partners may be unique across Accenture’s peers. One floor houses just Avanade, the company’s joint venture with Microsoft. TBR has argued for years that consultancies maintaining technology vendor agnosticism should still recognize their clients’ core IT systems will still be there even after the client spends a day being amazed by emerging technologies and all that digital transformation can do. Highlighting, or at least including, these technology partners should be part of any client workshop or design-thinking day. Combined with the “Business Groups” created with SAP, Oracle and, recently Pivotal, Accenture has taken a giant leap forward and literally built separate floors dedicated to these partners.

On Jan. 24, 2018, TBR attended Accenture Technology’s Analyst Day at the recently opened Innovation Hub in Bangalore, India. The event included technology demonstrations around specific industries and partners, as well as extensive discussions with Accenture executives.