FOR ADAPTIVE ENTERPRISES

10TOP TRENDS2014

2014 offers exciting new business and technology trends in that will become increasingly important and pervasive over the next year. Pegasystems’ Setrag Khoshafian shares 10 key trends that can have a lasting—and valuable—effect on every aspect of your business. By understanding and focusing on these trends, your organization gains the opportunity to streamline operations, enhance the customer experience and continuously increase business agility and excellence.

Dr. Setrag KhoshafianChief Evangelist and VP of BPM TechnologyPegasystems

JOIN THE CONVERSATION and tell us what your top enterprise trends are

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TREND

One of the most compelling trends for 2014 is the need for innovation across the enterprise.

The rapid pace of change is exceeding the capacity of traditional business, as well as

structured operational and IT models. Innovation needs to be a strategic priority combined

with execution that enables continuous change, while improving and “doing more with less.”

In 2014, organizations must not just embed innovation in their products and services, but

make it the “DNA” of the enterprise to make all functions and teams as agile as possible.

IT needs to lead the innovation agenda, but approach it holistically. Innovation needs to

be pervasive so that it spans IT, business, customer experience especially, and process

innovation for differentiation.

Innovation with Speed and Agility#1

Process Innovation:Intelligent automation of end-to-end collaborative business processes

Customer Experience Innovation:Intelligent Process-enabled CRM to treat different customers differently

IT Innovation:Direct vision, ideation, opportunities and overall digitization and delivery of innovative services and products

Product Innovation:Ideation “crowdsourcing” with customers & partners for innovative products

BUSINESS INNOVATION

Creative and transformed business execution that

continuously adapts

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TREND

For innovation to yield concrete and tangible results, it needs a revision of existing

organizational roles as well as new roles and cultures. In 2014, we will see more process-

centric roles, with increased collaboration between data owners and process owners.

These roles will empower people to achieve innovation with adaptability.

Role 2014 FocusProcess Owners Evolve from siloed departmental solutions to end-to-end processes that span the organization as well as the extended

supply and value chain.

Chief Process Officer

Own overall process efficiency to coordinate process owners, spearhead cross-process improvement and initiate Process Competency Centers, also called Centers of Excellence.

Chief Customer Officer

Own the lifetime value of customers, including their optimized and overall experience with the company.

Data Scientists and Owners

Data and process are two sides of the same coin. Focus on Big Data Analytics and Master Data Management for processes that span business units and the extended enterprise.

Chief Digitization Officer

Transform the enterprise with modern digitization, especially mobile, social , cloud and the "Internet of Everything"- within intelligent processes.

Analysts and Data Scientists

Provide expertise in the tools and methodologies needed to discover predictive models from all types of data including transactional, process, “big data”, text and unstructured data.

Business Transformation Roles and Empowerment #2

CDO CPOCCO

CUSTOMER DATA SCIENTIST BUSINESS ANALYST PROCESS IMPROVEMENTEXPERT (BB, GMB)

PROCESS ARCHITECT

BPM

CMO

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TREND

In mature organizations, the weight of a mish-mash of heterogeneous systems,

platforms, applications, languages, home-grown and point solutions conflicts with

change, adaptability and agility. In 2014 , persistent adaptability pressures will compel

IT to rationalize application portfolios, simplify with fewer data centers, platforms and

applications. Adaptive enterprises will modernize with intelligent business process

management (iBPM) providing a business-friendly agility layer that improves IT efficiency

and aligns business and IT.

Rationalization and simplification allow IT to get rid of complexities, replication and

technology silos. Modernization via a business-friendly agility layer lets business owners

become partners in transformation and even “own the change”. This trend will accelerate

as business owners gain the power to change policies, procedures and decision strategies.

iBPM will become the key enabler for simplification and modernization, aligning strategy,

continuous improvement and execution in adaptive enterprises.

Application Rationalization, Simplification and Modernization #3

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TREND

The Internet of Everything (IoE) is one of the most important technology trends of 2014

and beyond. IoE will involve billions of devices or “Things” connected over the Internet—

generating data, sensing, firing and consuming events, and being controlled remotely.

IoE will realize its full potential through intelligent processes (Process of Everything)

that can coordinate multiple participants (humans, systems and machines/devices) in

complex, dynamic processes and cases to achieve business objectives.

Intelligent processes provide the container and the context for intelligent things to collaborate

to achieve objectives. In the next couple of decades, semi or even fully automated human

robots and avatars will become more pervasive. As this trend matures, humans will

increasingly focus on innovation and cognitive work, delegating routine and even some

knowledge-assisted work to automated things and processes.

#From Internet of Everything to Process of Everything4

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TREND

The use of intelligent technology will accelerate in 2014 with the goal of making the right

decisions. With the explosion of data, organizations rely on analytics to make sense of

all this information and decide what to do. Predictive models are minded and discovered

from historic data. Big data is also becoming an important source for understanding

customer behavior. While these have value, the more exciting trend is the ability to act

on the discovered intelligence in real time. Real-time decisioning allows organizations

to achieve tangible benefits by unlocking the insights hidden in vast amounts of

digital information and capitalize on them within the context of marketing and service

interactions, for example.

Adaptive analytics are a significant part of this trend. Adaptive analytics take technology

intelligence a large step further, as they provide “self-learning” that can dynamically

incorporate new information and insights and automatically apply them to the next

applicable situation. This combination of data-driven recommendations from big data with

adaptive self-learning is an important 2014 trend, providing significantly more insight for

real-time decisioning than previously possible.

Intelligence through Analytics and Real-Time Decisioning #5

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TREND

As Millennials (Gen X) and Generation Z become a larger presence in the workforce, the ways

in which they work are different. In 2014, dynamic case management represents an important

milestone in the evolution of process automation that suits their collaborative and less

structured way of working.

Dynamic case management, with all its automation capabilities, supports the modern

worker’s culture. It provides end-to-end orchestration of tasks for all types of work from

structured and pre-determined to collaborative, unstructured and ad-hoc work. The case has

a business objective and uses business rules and decisions to intelligently and dynamically

decide how to move forward.

Because modern case workers rely on collaboration, social networking is now an important

part of the case. Social interactions are used to find new case solutions, complete ad-hoc

work, suggest improvements, resolve the case and monitor and analyze the performance of

case milestones.

Dynamic Case Management for the Modern Worker#6

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TREND

Process improvement empowered with execution is essential for the success of

enterprise initiatives. Methodologies that capture best practices and enable adaptation

are indispensable.While methodologies such as Lean and Six Sigma have been around

for some time, what is significant in 2014 is marrying these continuous improvement

methodologies with adaptive process automation methodologies.

Centers Of Excellence (CoEs) will become the key enabler of these combined methodologies.

The COE uses an adaptive methodology that identifies a best-choice opportunity for process

improvement. Starting with “slivers” of improvement, the CoE gradually builds iterations

that ultimately incorporate continuous improvement (Real-Time Lean Six Sigma) to optimize

the process.

Agile Methodology, Competency and Real-Time Continuous Improvement

#7

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TREND

Increasingly coalesced enterprise technologies involving mobile, social and the cloud are

becoming the de-facto strategic building blocks for digitization. In 2014, the maturity of

these technologies will pave the way for innovative use within the enterprise.

� Social networking is a natural and essential component for all types of process-enabled exchanges between employees and customers. Intelligent processes leverage social tools, providers and metaphors in all phases of solution lifecycles, while these processes provide context for social networking and collaboration.

� Mobile technology provides instant access to case status, work and collaboration, empowering an emerging mobile workforce to not just stay connected, but complete transactions and work via smart devices.

� With cloud computing, users can access services over the Internet (networks, servers, storage and business applications) conveniently and on demand. This allows organizations to easily build and deploy adaptive enterprise solutions on the cloud.

Digitization: Mobility, Social Networking and the Cloud #8

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TREND

A key trend in customer relationship management (CRM) has been the use of analytics—

especially predictive and adaptive models. In 2014, CRM will be enabled by intelligent

processes that leverage analytic insight in real time. Product and enterprise focus will give

way to dynamic, customer-centric recommendations based on customer needs, lifetime

value and business objectives. Organizations will be able:

� Eliminate confusing data-driven forms in favor of intuitive processes, decisions and guided interactions.

� Replace commodity services with personalized treatments that consider such factors as the customer, product, reason for the interaction and location when executing the business logic.

� Do away with manual work and exceptions handling using dynamic case management for holistic, end-to-end automation.

� Replace traditional “black box” CRM packages with complete visibility into all the procedures, policies and decisions within the CRM solution in order to simplify change, maintenance and customization.

CRM Driven by Intelligent Processes#9

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TREND

We conclude with perhaps the most important trend in 2014. Enterprise transformation

is not just about technology—it is also about an organizational culture that is focused on

continuously adapting its strategies to address two crucial gaps in execution. First is the

gap between business objectives and a mish-mash of existing systems that cannot easily

execute these objectives. Second is the gap between the voice of the customer and systems

that are not flexible enough to respond in order to optimize the customer experience. By

leveraging the trends we have discussed, organizations can overcome these gaps to:

� Continuously monitor and optimize measurable business outcomes.

� Allow process owners to transform the business and enable rapid innovation of specialized, contextual and situational solutions.

� Rationalize, simplify and modernize while continuously improving with iterative enhancements.

� Empower the modern workforce with dynamic case management delivered via multiple social, mobile and collaborative channels.

� Streamline work with intelligent processes that eliminate routine, manual work and exception handling.

� Leverage big data recommendations with predictive and adaptive analytics to continuously learn and adapt decisions in intelligent processes.

The Adaptive Enterprise

#10

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If you would like to learn more about key technology trends for 2014 and how intelligent

business process management (iBPM) can help you capitalize on these trends, download Dr.

Khoshafian’s newest book, “Intelligent BPM: The Next Wave” at no charge:

LEARNMORE

Through 15 in-depth chapters you'll discover:

� The role of iBPM and how both business and IT benefit

� How to create iBPM agile methodologies and

� Centers of Excellence

� How enterprises can be transformational and

� adaptive with iBPM

� How iBPM relates to SOA, EA, ECM, and the

� Internet of Things

� Why iBPM is a great fit for modernization andapplication rationalization

You can also gain more insights on the trends for 2014 in our thought leadership blogs at:

http://www.pega.com/community/pega-blog

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About Pegasystems

Pegasystems, the leader in business process management and software for customer centricity, helps organizations enhance customer loyalty, generate new business, and improve productivity. Our patented Build for Change® technology speeds the delivery of critical business solutions by directly capturing business objectives and eliminating manual programming. Pegasystems enables clients to quickly adapt to changing business conditions in order to outperform the competition.

For more information, please visit us at www.pega.com.