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Global ICT company uses its annual conference in Munich to highlight a services-led, global model designed to build successful digital transformation partnerships with customers.
The scale of digital change underway across all industries is forcing businesses to rethink their operating models in order to grasp new market opportunities and confront fast-evolving competitive threats. And to cope successfully with those pressures, they are demanding a new kind of relationship with their strategic suppliers, according to Tatsuya Tanaka, president of the global ICT company Fujitsu.
“With the expansion of ICT, no one can do everything themselves,” said Tanaka in his keynote address at Fujitsu Forum Munich 2018 earlier this month. And that means Fujitsu has had to change too, he said, announcing major changes to its traditional balance of products and services and the distribution of R&D more broadly around the world. “We are transforming ourselves into a service-oriented company,” he told the event’s 12,000 customers, partners and colleagues. As a result, the company’s previously separate PC/tablet/server line of business, and its components and electronic devices businesses will now sit under the services focus of Technology Solutions.
That is a response to the changing nature of customers’ IT investments, said Tanaka. Companies have a higher expectation of applying IT across their whole business, with senior management (beyond the IT department) increasingly keen to understand and exploit technologies such as AI, IoT, robotic process automation (RPA) and blockchain.
Coupled with that is demand for partnering across different industries. “Many customers are interested in developing new business models through co-creation that cross the barriers of organizations and industries,” said Tanaka. As well as creating new forms of businesses with customers, Fujitsu is interested in being a hub for “connecting customers across organizational and industry boundaries to develop new business models and cross-industry businesses.”
Satisfying that requires suppliers who are able to deliver products and services from a mix of vendors — and optimize their integration. “Fujitsu will break away from the ‘not-invented-here’ syndrome,” Tanaka said. “While we will continue to place importance on technological innovation and developing powerful products, as the field of IT expands it has become ever more important for us to combine the products we develop with products and services from strong partners around the world. This will enable us to provide greater customer value than ever before.”
Reflecting that, the company has implemented a major change in its cloud strategy. “We have revised the previous approach of prioritizing the development of our in-house [K5 Cloud] solutions and we have actively formed alliances with ‘mega-cloud’ partners such as Microsoft and VMware.” But the list is longer: as part of the Fujitsu Cloud Service, the company will also partner with Oracle and Amazon Web Services (AWS). An example of a recent customer win in this area was Securitas, the Swedish security services company. That involved AWS, Microsoft Azure and VMware.
As well as such multi-cloud orchestration of the migration of customers’ workloads into the cloud, Fujitsu aims to build on its strengths in the provision of hybrid cloud services.
To underscore its intentions and support that shift, the company says it is training around 10,000 people worldwide as certified multi-vendor cloud engineers. Separately, the company will hike its SAP services team to 5,000 globally and its security services group to 11,000.
Globalized R&D footprint
To support customers’ ambitions to exploit new technologies — and tap into the hottest centers of demand — the company plans to globalize much of its R&D. This will see the establishment of a headquarters for AI development in Vancouver, Canada, where it already has a major interest in quantum computing through its investment in quantum software start-up 1QBit. Other centers of excellence include: Brussels for blockchain; London and Tokyo for security; Madrid for analytics; Copenhagen for RPA; Munich for Industrial IoT, and Dublin for retail.
“To speed the delivery of services, we are strategically locating R&D in various global locations so that [those teams] can not only grasp the needs of those regions but also work closely with the delivery units in there.
“Customers are demanding such delivery is rapid,” said Tanaka. So Fujitsu has made a big commitment to train its teams in agile development, using a universal Enterprise Agile methodology and initially training 10,000 staff in its EMEIA region.
Hot product focus
But the emphasis is not all on services. The company has garnered considerable customer interest in its breakthrough Digital Annealer, an application-specific design that leverages ideas from quantum computing to solve in minutes or hours the kind of combinatorial optimization problems that are beyond the capabilities of conventional computers.
Duncan Tait, head of Fujitsu in EMEIA, pointed to instances when the Digital Annealer is transforming manufacturing processes, speeding up development in drug discovery, and delivering ground-breaking results in financial portfolio management.
One application is underway at NatWest, the UK banking giant, which is using the Digital Annealer to help dramatically speed up the optimization calculations for its high-quality liquid assets business, a management portfolio of around $150 billion.
Duncan Tait, head of Fujitsu EMEIA
Blockchain is another area of focus for the company where it believes it can bring some unique and compelling technology to the market.
During his keynote at Fujitsu Forum, Dr Joseph Reger, CTO for EMEIA, tackled cutting-edge developments in blockchain technology. Making a conscious effort to avoid a focus on cryptocurrencies, he suggested other use cases for the technology could be fraud detection in financial services and supply chain management in manufacturing. He also suggested that using the automation capabilities through smart contracts blockchain could help create a participatory democracy and aid public sector administration with revolutionary steps such as online voting.
With high expectations for the technology, Reger also believes blockchain will be instrumental in fixing many of the problems that have become inherent with the internet such as privacy and security for its users. “In defense of the internet, at the time we built it, it was unclear of its use. It is not a disgrace that the internet doesn’t fulfill all needs we have today [but] we need to rebuild it.” He believes the known security benefits, provenance tracking and immutability of blockchain will make it possible to re-architect a better internet.
Dr Joseph Reger, Fujitsu’s CTO for EMEIA
Anticipating the multitude of use cases for blockchain, Reger warns there will not be a single technology, solution or even a single blockchain model that will serve all needs.
Anticipating this and promoting interoperability challenges, Fujitsu has also developed software to create secure data exchange networks, allowing for the connection of two separate blockchains. The Fujitsu Virtual Private Digital Exchange can allow for the transfer of digital assets or digital data from one blockchain to another, bridging the gap between the two using another blockchain, a so-called connection chain.
One of Fujitsu’s public sector customers pushing ahead specifically with the application of blockchain is the Government of Estonia. Marten Kaevats, national digital advisor, Government Office of Estonia, reveals the country has been experimenting with blockchain for a decade.
“Since 2012, all Estonia governmental information log files have been backed up in blockchain,” he said. “This means ‘who did what and when’ with the data is always logged on the blockchain. Each citizen can see who is looking at their data and why, because ultimately the citizen is the owner of their data.”
Noting that trust is key in building ecosystems and technology, Kaevats asked: “How do you build trust constantly, especially when trust for institutions is waning?”
Question of trust
That was an issue tackled by guest keynote speaker Rachel Botsman, business author on trust and a lecturer at Oxford University’s Saïd Business School. “I think there is something more profound and interesting happening [than it being eroded]. Trust is like energy in that it doesn’t get destroyed, it changes form,” she said.
Rachel Bostman, business author
She outlined in her guest keynote how trust has historically been established locally between individuals or has flowed through institutions. But in the digital age trust is beginning to be embodied in and flow through platforms and networks, a notion she calls distributed trust.
“Technology is transforming how we trust in really interesting ways. It wants to move trust away from an institution and give it back to the individual, but on a scale we’ve never seen before. Blockchain is a really good example of distributed trust. This form of trust is only in its infancy but is already causing disruption.”
• Watch the highlights of Fujitsu Forum Munich 2018
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