Fujitsu sets out agenda for driving digital transformation
Tatsuya Tanaka, president of Fujitsu
Photography: Yasu Nakaoka
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Fujitsu sets out agenda for driving digital transformation

Kenny MacIver — June 2016

ICT company’s top executives outline how customers can grasp the opportunities and confront the challenges of the digital revolution as it reshapes both business and society.


Global ICT company Fujitsu used its annual conference and exhibition in Tokyo 19-20 May to showcase its fast-maturing Digital Business Platform MetaArc, which is designed to empower the digital transformation ambitions of customers and partners and help them “digitalize with confidence.”

Alongside a host of new products and services, the 13,000-plus audience at Fujitsu Forum 2016 saw how MetaArc is already being used to help organizations react to the profound changes that are sweeping through business and society, while also providing a foundation for taking their existing applications and systems into the cloud.

Setting the historical context for the announcements, Fujitsu president Tatsuya Tanaka portrayed how the digital revolution would be as impactful as the agrarian, industrial and information revolutions that went before it. “A major change is about to happen in the history of mankind. And this fourth industrial revolution will change the way we produce, the way we work, the way we live and the way we think.”

“Digital innovation will enable and help realize a new smart society, and how we make this future is in our hands.”

To ensure Fujitsu becomes a force in this era of digital transformation, the ¥4.7 trillion ($41bn) company is investing heavily in four technology pillars — artificial intelligence (AI), the Internet of Things, big data and mobile — while underpinning these with a renewed focus on cyber-security.

But as with any major turning point, said Fujitsu’s head of global marketing Hiroyuki Sakai, the future shape of society will be determined by the choices made today. For Fujitsu, those are all about putting people at the center of IT.

“Digital innovation will enable and help realize a new smart society. How we make this future is in our hands,” said Sakai. In support of its concept of Human Centric Innovation, everything the company undertakes — from R&D to products and services — needs to have people at its core, he stressed. “Fujitsu wants to be a company that is trusted to enrich society through digital; working together with customers to drive their digital transformations,” he added.
Co-creating new business

There is certainly a growing appreciation among those customers that digital will spur new business models, transform industries and redraw competitive lines. Recent research carried out by technology analyst group Gartner shows a cross-section of CEOs from around the world predicting that more than 40% of their companies’ revenues will be derived from digitalized business within five years. That will be up from around 20% of revenues today.

Supporting such ambitions, in the past year alone Fujitsu has worked with customers on more than 300 proof of concept digital transformation projects that have looked to forge new business models, propel them ahead of competitors and enhance customer engagement and experience, said Sakai. But he emphasized that the company is doing so by co-creating such value with customers.

Fujitsu Sakai
Hiroyuki Sakai, head of global marketing, Fujitsu

A good example of it fostering business model change has been with Japanese condominium rental company Leopalace 21 Corporation. Leopalace saw the opportunity to create a brand new revenue source by installing solar panels on the roofs of its buildings, so becoming an electricity generator. The key digital enabler behind that new venture is an energy management system — Venus Solar — built in partnership with Fujitsu.

Already, the system has been deployed at more than 4,500 apartment buildings, providing a total generating capacity of 70 megawatts.  And Tanaka indicated that the two companies are now looking to broaden the model so they can offer other apartment building owners the opportunity to use their rooftops for power generation. That is just the kind of ecosystem that emerges in many digital transformation programs, said Sakai — with all participants able to benefit.
Serving transformation ambitionsFujitsu is underpinning all such projects with MetaArc, which it introduced last year as its way of delivering digital transformation by bringing together all the elements organizations need to address the opportunities and challenges of the digital age.

To help organizations, says Tanaka, “what’s needed is a globally consistent approach to service companies’ digital transformation ambitions and help them digitalize with confidence.” Fujitsu describes MetaArc as a comprehensive set of solutions, services and cutting-edge technologies — spanning IoT, mobile, analytics, AI and security — that integrates the digital transformation of business and existing information systems. Sitting at its heart is K5, the company’s global core cloud services platform.

“With MetaArc we want to go beyond the boundaries of companies, organizations and industries and create a digital platform that supports the advancement of digital transformation,” said Sakai.

fujitsu forum v2 

he company aims to build a developer ecosystem around MetaArc. The MetaArc Venture Community will support start-up companies globally to use the business platform and leverage Fujitsu services to build innovative applications and services.

However, MetaArc is not only designed to underpin new digital business innovation. It will also provide a platform for the modernization of existing IT infrastructure by re-hosting applications and systems in efficient cloud environments. Deployment models will range from highly secure on-premise and virtual private clouds to public clouds.

With an eye on digitalizing its own business Fujitsu is practicing what it preaches. The company is in the process of moving 640 of its core internal systems to K5. To date, 60 systems have been migrated, but when complete the move will have reduced the total cost of ownership of these systems by ¥35 billion ($319m).

“To create an enriched society using IoT, we have to resolve the data utilization bottleneck.”

At the cutting edge of technology, Fujitsu aims to play a major role in how AI technologies such as deep learning will evolve to enhance the daily activities of people and organizations. That will focus on three areas:
• sensing and recognition (voice, image and emotional state)
• knowledge processing (including natural language and pattern discovery)
• decision and support (including AI-based prediction and action recommendation).

The outcomes will include applications in transport safety, with vehicles able to understand and interpret their immediate environments, the use of AI in medical diagnosis and the modeling of the impact of natural disasters.

In the area of big data and IoT, Fujitsu’s Tanaka points out that while enormous amounts of data are being generated, only a small portion of it is being turned into business value. “So to create an enriched society using IoT we have to resolve the data utilization bottleneck,” he said.  And he pointed to several large-scale implementations of big data that are doing just that.

Fujitsu’s cloud service for real-time location data analytics, SPATIOWL, has been deployed in Tokyo and uses widely deployed sensors, Hadoop-powered big data analytics and Fujitsu cloud technology to create detailed, real-time models of traffic and people flow around the city. That expertise is also being shared elsewhere in Asia. Indonesian toll road management company PT Marga Utama Nusantara is implementing SPATIOWL to provide drivers with real-time information on traffic congestion and so encourage the use of its toll roads.
Security imperative
These massive flows of data are making cyber-security a daunting challenge, said Tanaka, and are a prime example of where AI can have a major impact. To help customers mitigate against ‘zero-day exploits,’ Fujitsu is using AI to rapidly analyze vast amounts of communications log data in near-real-time in order to spot abnormal patterns that might indicate a new type of cyber attack.

Also highlighting the security challenge at the Tokyo conference was Cisco global innovation officer Dr Guy Diedrich, who helps guide digitalization programs at a country level for governments around the world, including France and Japan. Reinforcing the imperative that security underpins all digitalization initiatives, he outlined a recent conversation with Japan’s prime minister, Shinzō Abe.

“We thought the prime minister's digital priority would be about preparing the country for the Tokyo Olympics of 2020. Instead his number one digital priority is cyber-security.” Diedrich pointed out that Japanese government facilities dealt with 54 billion cyber attacks in 2015, twice the number experienced in the previous year.

Security, like many other aspects of digital, will demand increased levels of collaboration between organizations, said Tanaka. “Needless to say, there’s only so much that one company can do, so we will further enrich our collaboration with our technology industry partners. We need to be flexible in our thinking, to overcome boundaries between organizations and verticals. The key to success is how quickly we can establish such models in which we can co-create with customers and partners.”

Tatsuya Tanaka will be delivering the opening keynote on ‘Driving digital transformation’ at Fujitsu Fourm 2016 in Munich, 16 and 17 November, alongside Duncan Tait, the company’s head of Americas and EMEIA.

First published June 2016
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