Fujitsu commits to ‘bridging the digital gap’
Photo of Duncan Tait, SEVP and head of Americas and EMEIA, Fujitsu
Photography: Enno Kapitza
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Fujitsu commits to ‘bridging the digital gap’

Maxine-Laurie Marshall and Kenny MacIver — November 2017
Global ICT company uses its annual conference in Europe to showcase cutting-edge technologies, and co-creation initiatives designed to move customers from digital transformation strategy to successful execution.

“Digital disruption is becoming the defining theme of the 21st century. And if it continues at the current rate, then by 2025 30% of global business revenue will be redistributed to brand new players.”

That was the stark warning from Duncan Tait, Fujitsu’s SEVP and head of Americas and EMEIA, to the 12,000 attendees at the global technology company’s annual conference in Munich in November. The challenges of such disruption extend well beyond the boundaries of any single organization, he said, requiring a coordinated response across business, government and society.

Drawing on new research by the company that canvassed the views of 1,625 business decision-makers worldwide, Tait revealed a picture of businesses struggling to succeed in their digital transformation efforts — with painful financial consequences. While almost 90% of the businesses surveyed believe they have a culture of innovation, a third have cancelled digital transformation projects in the past two years at an average cost of €0.5 million ($0.6m). “Companies are being consumed by a fear of failure and by their internal skills gaps. If you’re lacking the skills to digitalize and have a gap between strategy and execution, you must collaborate,” he said.

Fujitsu Forum 2017 Munich

The way forward, he argued, is through digital co-creation initiatives with experienced partners such as Fujitsu that have the scale and surrounding ecosystem of technology partners who “can collaborate together and help customers close that execution gap.”
Co-creation in action

Tait went on to announce a series of recent co-creation success stories. The company has developed an AI tool with Siemens Gamesa Renewable Energy to improve quality control in the engineering company’s manufacture of wind turbine blades. Using image processing and deep learning techniques, the solution is able to identify patterns that indicate a manufacturing flaw that might cause the blades to fail during operation. The approach has reduced blade inspection time from six hours to just one and a half.

In the health sector, Fujitsu is working with Slingeland Hospital in the Netherlands on sensors to enable nursing staff to continuously monitor patients’ vital signs. Using details of the hospital’s healthcare monitoring requirements and Fujitsu’s IoT expertise, the team co-created a solution that attaches two small sensors to patients while placing additional sensors around their beds. Together, these provide 24x7 monitoring of heartbeat, blood pressure, respiratory rate and other health data, and can be tracked regardless of where the patient is within the hospital. The results include freeing up nurses’ time to focus on care-giving and treatment rather than running routine checks. Chrit van Ewijk, CEO at Slingeland Hospital, said that the system enables nurses to apply data-driven decision-making, prioritizing the care of patients who have more acute health issues. “In the near future,” predicted Van Ewijk, “we expect to be able to predict a patient’s deterioration and to intervene at an early stage.”
Investing in digital transformation

To further assist customers’ digital journeys Fujitsu is investing heavily in what it sees as the four core technologies of digital transformation: Cloud, IoT, AI and security.

It has continued the global rollout of its Fujitsu Cloud Service K5. Adding to the earlier zones in Japan, the UK, Finland, Germany and Spain, the cloud data centers are now also available in the US, with Singapore and Australia to follow soon. The company has also introduced the K5 Playground, creating a safe space in which customers can fast-track the testing of cloud applications.

To support its IoT offerings Tait announced the launch of INTELLIDEGE, a new solutions line for ‘Industry 4.0’ that provides edge compute processing and closes the gap between field operational technology and on-premise/cloud IT.

Fujitsu has also opened an AI Center of Excellence in France in collaboration with the French government. And on the security front, the company has increased its team of cyber engineers to 2,000, supporting customers globally through a network of 13 Security Operation Centers that are active 24x7 and through newly established advanced cyber-threat centers in the UK and Germany.
New competitive dynamics

Tait was not the only voice at Fujitsu Forum calling for a deeper collaborative foundation for digital transformation. Keynote speaker Rita McGrath, professor of strategy and innovation at New York’s Columbia Business School, told attendees that successful digital co-creation required a new strategic framework. Citing the emergence of digital business models and a pace of change accelerated by digital, McGrath insisted that companies can no longer count on establishing a sustainable competitive advantage and living off that for many years. “Just because you’ve had long period of success doesn’t mean rules won’t change,” she warned attendees. “We’re now in a world of transient rather than sustainable competitive advantage.”

Rita McGrath Fujitsu Forum 2017

Competitors can now come from any industrial sector as boundaries are blurring and ecosystems are being formed to satisfy new customers’ demands that are moving away from products to services or experiences. McGrath says: “We used to think that owning assets was our way of protecting our competitive advantage. But now people don’t need to own assets [such as music recordings or cars], they can use them on an as-needed basis.”

She said this shift from products to services is creating a network effect that businesses need to grasp. No matter how many customers own a product, it doesn’t add to the user value. However, as a network builds around a service there is an exponential increase in the user value generated. For example, a dating site only becomes valuable to the user as more people join in. When businesses can mimic this effect in their own spheres and provide valuable environments where customers can come together in a network, the ecosystem grows and the service is progressively enhanced.

“Worry less about competitors and worry more about customers,” she counselled. “You can drive yourself crazy charting competitors’ moves and wondering what they will do next. But you will never go wrong if you really understand the customers’ buying [patterns].”
Building a collaboration

Co-creation was also on the mind of Jo De Vliegher, CIO of Norsk Hydro, the NOK82 billion ($10bn) global aluminium company. Co-creation is necessary for transformation, he said, but its success is also dependent on making changes to internal business culture. Like other companies, Hydro sees digital transformation as too important and complex a challenge to undertake with just its own pool of talent. “We must make our people comfortable with this process of partnering up with suppliers and achieving results together,” he said.

Having laid the foundations for its digitalization journey through a comprehensive IT modernization program, Hydro is now setting some big challenges for its technology partners: “We want to go a step further now, go beyond the ‘normal’ ICT and challenge companies such as Fujitsu on what they can deliver going forward with robotics and process digitalization, using technology to optimize productivity, create new services and improve our carbon footprint,” said Hans Petter Øya, the Norwegian company’s program manager for digital strategy.
Towards a quantum future

Acknowledging that its customers are looking to future technologies to support their digital transformation ambitions, Fujitsu president Tatsuya Tanaka unveiled a new computer design inspired by quantum computing technology that promises to deliver a step change in processing performance. “There are a lot of problems in the world that require more sophisticated computing power. So we need a new type of computer, and quantum computing is quickly becoming a strong candidate [for addressing those problems].”

The Fujitsu Digital Annealer design implements quantum-inspired computation on a traditional digital circuit. The system can process enormous amounts of data combinations known as combinatorial optimization problems. Shigeru Sasaki, CEO of Fujitsu Laboratories, gave an example of how it could speed up drug discovery processes by analyzing tens of millions of chemical compounds — delivering results in less than a day rather than the two weeks a conventional approach would take.

The Digital Annealer’s foundation on standard digital technology enables the delivery of quantum computing-like capabilities without having to overcome the huge challenges of building and running a true quantum machine. Fujitsu Laboratories plans to commercialize the technology in the first half of 2018, with a view to applying it in a variety of fields, including chemistry, finance, energy and distribution.

Fujitsu’s CTO for EMEIA, Dr Joseph Reger, used his keynote address at Fujitsu Forum to explore that step towards exploiting that potential of quantum computing. “[With the Fujitsu Digital Annealer] we are doing what can be done today. It’s not quantum, but it is quantum inspired. And it’s 17,000 times faster than a normal computer and very energy efficient,” he said.

Dr Joseph Reger Fujitsu Forum 2017

He characterized that performance leap in terms of the biennial performance-doubling associated with Moore’s law, saying that’s Fujitsu breakthrough represents 14 chip generations or 30 years of development time. “It’s a step towards quantum speed-up and it will help to solve pretty much the same problems as quantum computing will be addressing,” he said.

But the benefits of quantum technology go beyond dramatic performance enhancement, Reger told the conference. Because quantum states cannot be copied, the approach can be used to build entirely secure communications channels, he explained. “Quantum IT is so incredibly exciting because it will allow us to build secure networks, secure clouds, a quantum-secured internet, and therefore a safer world.”

“The future is much brighter with quantum computing,” said Reger. And although he predicted that a true quantum computer may not be commercially viable for another seven to 10 years, “in the mean time, technologies like Fujitsu Digital Annealer will enable us to take a giant leap ahead and build a safer, more prosperous world for everyone.”
First published November 2017
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