We’re proud to share that the IBM Institute for Business Value (IBM IBV) has once again been ranked the #1 thought leadership producer for quality among leading consulting and technology firms, according to Source Global Research.This recognition comes from Source’s Quality Ratings of Thought Leadership for 2025, which evaluates a random sample of thought leadership from 19 firms using its White Space quality assessment methodology. This is IBM’s third straight year in the top position. &nbsp;<h3>The four pillars of the Source methodology</h3>Source assesses thought leadership using four quality pillars that reflect what senior executives value most: &nbsp;<figure class="table"><table style="border-style:none;"><tbody><tr><td style="border-style:none;vertical-align:top;"><h3>Differentiation</h3><ul><li data-list-item-id="ec6b916fa48e56ea9ac9b601404795334">Is the content timely and relevant?</li><li data-list-item-id="e8c1a814452b417d799ce87755841a3d2">Does it provide insight that goes beyond what is already well known?</li></ul></td><td style="border-style:none;vertical-align:top;width:8%;">&nbsp;</td><td style="border-style:none;vertical-align:top;"><h3>Appeal</h3><ul><li data-list-item-id="e14345decd3070fde6cb58b426601b337">Does the content encourage the reader to engage and keep reading?</li><li data-list-item-id="e95737a76271e0b7eb1f6d5eb02fb79f8">Is it clear, accessible, and easy to navigate?</li></ul></td></tr><tr><td style="border-style:none;vertical-align:top;">&nbsp;</td><td style="border-style:none;vertical-align:top;width:8%;">&nbsp;</td><td style="border-style:none;vertical-align:top;">&nbsp;</td></tr><tr><td style="border-style:none;vertical-align:top;"><h3>Resilience</h3><ul><li data-list-item-id="e742f4fb5ce47d20dbcbef61508a744bb">Are the insights credible and trustworthy?</li><li data-list-item-id="e9dfa95c596b4ab3c6223b13b42925ac6">Is the research transparent and clearly authored?</li></ul></td><td style="border-style:none;vertical-align:top;width:8%;">&nbsp;</td><td style="border-style:none;vertical-align:top;"><h3>Prompting action</h3><ul><li data-list-item-id="e6c5ab5108cf3e5e9820da3432a7df091">Does the content give the reader a clear sense of what to do next?</li><li data-list-item-id="e90868c13d181bd6424acffac22364723">Does it help translate insight into practical action?</li></ul></td></tr></tbody></table></figure>&nbsp;<h3>IBM’s performance in the 2025 quality ratings</h3>In the 2025 assessment, the IBM IBV ranked first overall across all firms reviewed. The IBM IBV also ranked first among all firms for prompting action, demonstrating a top-ranked ability to help leaders understand how to move from insights to next steps.Across the remaining pillars—differentiation, appeal, and resilience—the IBM IBV consistently placed among the top performers.Reports recognized in the assessment Two IBM Institute for Business Value reports appeared among the highest‑scoring publications in the overall sample:<ul><li data-list-item-id="e82e7804dd8610d9008a2bd40794af11f"><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/cybersecurity-ai-workforce">Cybersecurity 2028: Your workforce, built for the AI frontier</a>—Explore the ways in which organizations can shift to AI‑first cybersecurity operations over the next three years using a crawl‑walk‑run approach.</li><li data-list-item-id="ed144c8acacc1da9d6477547c3104abdf"><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/enterprise-resource-planning-erp-ai">ERP meets AI: Fortune favors the bold</a>—Discover how ERP platforms are being used to scale enterprise AI, separating incremental gains from true business transformation. &nbsp;</li></ul><h3>Why thought leadership quality matters</h3>Source’s report observes that professional services firms are finding it harder to stand out as the volume of published content continues to grow. As a result, quality, relevance, and actionability are becoming more important differentiators than scale alone.Prompting action, in particular, remains a persistent challenge across the market. While Source notes progress in this area compared with prior years, it highlights that firms that dedicate space to clear recommendations, frameworks, and case-supported guidance are better positioned to deliver value to executive audiences.Source is not alone in their assessment of the current thought leadership landscape. According to the Global Thought Leadership Institute (GTLI), three of the most important standards for meaningful content are trustworthiness, original insight, and actionable impact.And quality matters. <a target="_blank" rel="noopener noreferrer" href="https://gtli.org/promise-peril-attitudes-practices-thought-leadership-changing-era-ai/">87% of executives who consume thought leadership</a> say they’re likely to purchase business services from an organization based on the quality of their thought leadership.Looking ahead IBM’s #1 overall ranking reflects continued strength in delivering thought leadership that meets Source’s quality criteria, especially when it comes to helping executives translate insight into action.As expectations for thought leadership continue to rise, maintaining relevance, credibility, and usefulness will remain central to delivering value for leaders navigating complex decisions.A note of thanks This recognition reflects the collective work of researchers, writers, designers, editors, marketers, and partners across the IBM Institute for Business Value. Creating thought leadership that resonates with senior leaders takes rigor, collaboration, and a shared commitment to quality.Congratulations to everyone involved for continuing to raise the bar and helping leaders turn insights into action.Stay in the know Get easy access to a curated list of the IBM IBV’s latest research. <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=news-urx-53569">Subscribe now</a> to IdeaWatch, the IBM IBV’s monthly newsletter for the insights that matter.&nbsp;&nbsp;&nbsp;

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IBM Institute for Business Value ranked #1 for thought leadership quality

In a world defined by turbulence, massive economic uncertainty and regulatory shifts are colliding with the rapid rise of AI—a technology evolving faster than anyone can reasonably keep up with. For CEOs, the stakes have never been higher.Every decision feels like a gamble, with leaders expected to deliver results amidst constant disruption. But what if uncertainty wasn’t just a challenge to endure, but an opportunity to unlock growth?The 2025 CEO Study—conducted by the IBM Institute for Business Value as part of our Global C-suite series—reveals the strategies and mindsets that set today’s leaders apart from the rest.Based on a survey of 2,000 CEOs from 33 countries and 24 industries, the study offers a roadmap for navigating the complexities of the modern business landscape.&nbsp;Our research found that for CEOs:<ul><li>AI adoption is accelerating: 61% of CEOs say their organization is actively adopting AI agents today and preparing to implement them at scale, with expectations that AI investments will grow twice as fast as they did last year.</li><li>AI has them rethinking everything: 68% of CEOs say AI changes aspects of their business that they consider core—from the products and services they offer to how they run their business.</li><li>There's a gap between ambition and reality: Only 25% of AI initiatives have delivered expected ROI over the last few years, and only 16% have scaled across the enterprise.</li></ul>To bridge this gap and stay competitive in an AI-driven future, CEOs are adopting strategies to address workforce challenges, including reskilling existing talent, hiring for emerging AI-related roles, and integrating AI into workflows.&nbsp;But in the urgency to stay ahead in an AI-dominated market, leaders are under pressure to move faster and take risks. 64% of CEOs say the risk of falling behind drives them to invest in some technologies before they have a clear understanding of the value those solutions bring to the organization. &nbsp;<h3>What does this mean for leaders?</h3>As CEOs navigate the complexities of the modern business landscape, prioritizing growth is far from straightforward. Leaders must juggle competing demands—delivering immediate efficiency gains, positioning their organizations for long-term growth, innovating at scale, and transforming their workforce—all while avoiding costly mistakes.It’s a high-pressure balancing act, but leaders who succeed have embraced a bold mindset. To win in this environment, CEOs should:<ul><li>Make intentional risk-taking a priority: By embracing AI and taking smart risks, leaders can deliver success, even in uncertain times.</li><li>Prioritize innovation that delivers outcomes: Ignore the hype and focus on using AI to drive real business value.</li><li>Get rid of “good enough”:&nbsp;Inspire teams to think bigger with bold ambitions. Set goals that are so sharp that everyone understands them—and silos must crumble to meet them.&nbsp; &nbsp;</li></ul><h3>Discover how to move from productivity to performance&nbsp;</h3>With the pace of change accelerating and the stakes higher than ever, it's time to take a bold step forward.&nbsp;Read our full <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo">2025 CEO Study</a> report to learn how five mindshifts can help your organization unlock new opportunities for success. You'll also find actionable steps you can take to drive transformation, overcome obstacles, and stay ahead of the competition.<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">Subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success. &nbsp;

Insights from the IBM Institute for Business Value 2025 CEO Study

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How CEOs can turn massive disruption into growth opportunities

<h2>Modernizing Industry Operations&nbsp;</h2>In today’s rapidly evolving industry transformation, enterprises continue to invest in emerging technologies such as data, automation, AI, generative AI, including Large Language Models and advanced enterprise applications, striving to drive their digital transformation journey forward.However, despite the excitement and investments, CIOs and business leaders face a daunting challenge – to unlock the full potential of these technologies, automate for zero-touch operations, and drive real business outcomes.In the banking sector, CIOs and CFOs face challenges due to macroeconomic and geopolitical uncertainties, as well as increased competition, which highlight the limitations of conventional business models.Trade Finance operations in Banking which is $55B in market size, continue to face challenges such as:<ul><li>High costs due to the amount of people and complexity needed to validate each transaction</li><li>Manual and time-consuming processes due to 4-eye and 6-eye manual validations</li><li>Complexity-driven checks and balances performed on each transaction</li><li>Operational risk arising from continued manual handling of transactions and communications in operational processes</li></ul>Yet, despite the growing promises of AI solutions to address these challenges; there’s a significant gap between the promise of AI and the reality of scaling AI solutions. Expectations&nbsp;remain high. &nbsp;Over half (56%) of global banking and financial market executives plan to automate their operations functions with digital agents in high priority, high impact workflows.&nbsp;<h2>The dawn of a new era – autonomous automation</h2>With numerous technology stacks available, it’s easy to get lost in the sea of options. The proliferation of automation and AI solutions has created a situation where executives are overwhelmed by the sheer number of choices, making it difficult to identify the right blueprint that can bridge the technological gaps, provide interconnectivity and drive real, measurable business value.The convergence of generative AI and cloud-based solutions has enabled autonomous automation – a matrix with AI assistants, intelligent autonomous agents, and people harmoniously working together.An intelligent layer, or AI-Fabric, streamlines integration, curation, governance and delivery of high-quality data for AI-driven analytics.&nbsp; This intelligent layer provides interconnectivity and orchestration – enabled by Ai digital assistants and autonomous agents – to automate and redefine new workflows based upon continuous learning.The autonomous agents use sensors, transactional and external data to perceive their environment and self-make decisions without human intervention.&nbsp; Many executives, across various industries realize the opportunity. 70% of healthcare and life sciences execs say that their workflows will be digitized with intelligent automation and AI agents by 2026.<figure class="image"><img style="aspect-ratio:1280/385;" src="/thought-leadership/institute-business-value/uploads/en/8_Yoj4_O_Ez2rttdz5_C_Kbav_Sf6z_941e472305.png" width="1280" height="385"></figure>AI Fabric serves as a standard, reusable industry operations platform that bridges the gap between business and IT through a nimble, flexible, and seamless approach. By integrating data, automation, AI, enterprise applications and large and small language models (LLMs, SLMs) with full-stack orchestration, AI Fabric enables enterprises to leverage the full potential and scale AI.At the heart of AI Fabric is the main Orchestration Engine, a powerful and technology-agnostic platform which acts as the main agent that issues and orchestrates precise commands to multiple agents based on user prompts. Just like humans interact to each other, these agents interact, collaborate and build relationships among other agents, leveraging the agentic behavior to seamlessly execute complex actions across the enterprise.&nbsp;These agents leverage a synthesized data coming from the data fabric intelligent integration layer. &nbsp;Agents then use “AI Asset Crawler” to identify the right assets and solutions from the assets marketplace and create dynamic intelligent workflows to deliver the desired outcomes with full-stack orchestration capabilities, without the need of pre-programmed bots or traditional agents.&nbsp;Autonomous agents are often used in robotics, autonomous assets, and other operational environments where decision-making, and action-taking are critical.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-physical-asset-management">In a recent IBV generative AI study, 77% of executives say gen AI will enable connected assets to make autonomous decisions by 2026</a>.CIOs can consider AI Fabric as an oxygen and a blueprint that weaves&nbsp;Data &amp; AI&nbsp;into a fabric that automates and transforms industry operations to drive business value and ROI, powered by Agentic framework for any industry specific processes such as:<ul><li>Claims Operations</li><li>Trade Finance</li><li>Citizen Services</li><li>Billing operations</li><li>Healthcare experience&nbsp;</li></ul>and many more..&nbsp;<figure class="table"><table><tbody><tr><td style="background-color:hsl(0, 0%, 90%);border-color:hsl(0, 0%, 90%);padding:20px;"><h4>According to&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.marketsandmarkets.com/Market-Reports/autonomous-ai-and-autonomous-agents-market-208190735.html">Markets and Markets’ Autonomous AI and Autonomous Agents Market Forecast</a>, the market is expected “to reach USD 28.5 billion by 2028 at a CAGR of 43.0% during the forecast period”.&nbsp;</h4></td></tr></tbody></table></figure> With AI Fabric blueprint; CIO’s and business leaders can:<ul><li>Shift from labor arbitrage to zero touch transformation</li><li>Get desired Return on Investment (ROI) and Productivity</li><li>Reimagine customer experience</li><li>Optimize OPEX and CAPEX</li><li>Manage risk and compliance better</li><li>Address skills gap, attract, retain and nurture talent</li></ul>AI Fabric is not just about technology—it’s about creating a smarter, more connected organization that can adapt, innovate, and thrive in today’s fast-paced digital operations environments.

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AI fabric blueprint for industry transformation

As we step into 2025, businesses across industries are poised to harness the transformative power of AI to drive innovation, growth, and success.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/business-trends-2025">A new report </a>from the IBM Institute for Business Value reveals the five key trends that will shape the business landscape in the coming year:<h2>1. Agentic AI will transform your business—but first you must reskill your people</h2>AI continues to evolve, meaning that workers will need to rethink how they do their jobs to make the most of generative AI. Invest in reskilling and upskilling to ensure that your workforce is equipped to succeed in an AI-driven environment.To achieve this, AI literacy should become a must-have for all employees. Launch comprehensive educational initiatives that blend theoretical knowledge with hands-on projects.&nbsp;For example, your company can create a knowledge-sharing program that brings together people with product, engineering, and AI expertise to share best practices and learn from each other.The continued growth in demand for AI skills means you will need to prioritize talent acquisition and retention. Offer competitive salaries, benefits, and training programs that attract and retain top talent.&nbsp;<h2>2. Despite efforts to slow its growth, technical debt continues to increase</h2>Technical debt refers to the long-term costs and inefficiencies caused by quick, suboptimal technical decisions made to expedite development or delivery. To avoid compounding technical debt, incentivize teams to adopt a hybrid cloud architecture, modernize traditional systems, and change the way they develop new solutions.Leaders can bridge the gap between vision and reality by identifying the missing architectural pieces needed to succeed with AI at scale. You must also connect AI business cases to associated modernization costs to avoid unexpected expenses. By doing so, your organization can ensure that its technical infrastructure is aligned with their business goals and that you are well-positioned to succeed in an increasingly complex and dynamic environment.Furthermore, design your technical infrastructure for flexibility and scalability in mind. Adopt a hybrid cloud architecture that allows for seamless integration of different cloud services. Prioritizing DevOps and continuous integration can also help ensure that technical infrastructure is agile and responsive to changing business needs.<h2>3. In the age of AI, location is everything</h2>As organizations seek out the talent, data ecosystems, and infrastructure needed to scale AI effectively, they're moving operations to places that provide the greatest strategic advantage. Leaders must assess where data is housed and rethink how—and where—their organizations should operate.Stress-test your strategy and develop AI models specifically for navigating global instability. Use predictive analytics to stay ahead of regulatory changes, supply chain challenges, and shifting labor markets in volatile regions.Additionally, prioritize risk management and mitigation strategies to ensure that you are well-prepared for potential disruptions. Develop contingency plans, identifying potential risks, and prioritizing business continuity.<h2>4. The rapid pivot to AI has upended IT budgets, but self-funding is imminent</h2>AI investments continue to grow and as a result, organizations are reevaluating their spending priorities and moving money where it's needed most. Leaders must make data-driven decisions about which AI investments will drive the greatest business value and fund them accordingly.To ensure that your AI investments reflect business goals, your organization must unify infrastructure and amplify impact. This can be done by clearly defining what each AI investment is worth to your business—and what they will cost to implement. You must also identify the infrastructure upgrades needed to roll out solutions at scale and bundle projects that can share these costs to boost ROI.Furthermore, conduct thorough ROI and cost-benefit analysis to ensure that your AI investments are delivering the expected returns. Establish clear metrics and benchmarks for AI investments, then regularly monitoring progress.<h2>5. AI product and service innovation is the #1 CEO goal, yet business models aren't keeping up</h2>To make the most of innovative offerings, organizations must rethink how they turn a profit. This starts with analyzing customer and market data faster and more comprehensively than ever before—then changing strategies based on what's learned.To drive innovation, your organization must shatter departmental divides and build multidisciplinary teams that blend technology and business. Encourage knowledge-sharing and collaboration between different departments and teams. Leaders should also prioritize innovation and experimentation, and create a culture that encourages creativity and risk-taking.Additionally, develop business models that are aligned with customer needs and preferences. Use AI to analyze your customer data and develop personalized products and services that meet these needs.<h2>Stay trendy in 2025</h2><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/business-trends-2025">Download the full report</a> to discover more about the five trends that will define the business landscape in 2025 and learn what you should do about them.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.     &nbsp;

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Five trends for 2025

Unlocking the future of business

Supply chain leaders are facing unprecedented challenges. From geopolitical conflicts to climate catastrophes, disruptions can come from anywhere, and it seems impossible to predict what will happen tomorrow.&nbsp;But what if you could spend your time spurring growth instead of limiting losses? What if you could predict the future accurately enough to give your business a competitive edge?<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/supply-chain-ai">A new report</a> from the IBM Institute for Business Value and Amazon Web Services, titled "The Intuitive Supply Chain: Predict Disruption, Deliver Growth," explores the role of generative AI in transforming supply chain operations.&nbsp;According to the report, 64% of Chief Supply Chain Officers (CSCOs) say that generative AI is completely transforming their workflows, and 60% of executives believe that AI assistants will handle most traditional and transactional processes by 2025.<h2>Lean into the power of decision support</h2>To improve supply chains, organizations should leverage AI assistants to support decision-making. By analyzing vast stores of data almost instantaneously, AI assistants can bubble up critical insights for supply chain teams to skim from the surface. Plus, their natural language skills make it easy for employees to ask for the information they need—and find out where it came from—with a few simple prompts.For example, AI assistants can analyze which supplier is contributing the most to delays and identify issues causing disruption, such as weather, financial obstacles, or transportation bottlenecks.&nbsp;Then, AI-fueled predictive models can outline how the situation is most likely to evolve, allowing AI assistants to offer targeted recommendations that help supply chain teams prepare for what's next.<h2>Accelerating supply chain intelligence</h2>By allowing gen AI assistants to interact directly with the intelligent layer of the supply chain system, internal and external teams can collaborate more seamlessly. The goal is for AI assistants to continually communicate the intelligent layer's findings to the appropriate part of the supply chain team, along with recommended actions.The convergence of gen AI and cloud-based solutions has also enabled autonomous automation. Gen AI assistants can automate the process of workflow reinvention, learning from supply chain metrics and transaction history, making proactive recommendations, and even repurposing or redefining new workflows based on what they've learned.<h2>Visualize the future</h2>Gen AI-enabled virtual models can also help teams simulate how future events could affect supply chain operations, predicting potential problems and recommending respective contingency plans.&nbsp;For example, data from drones, robots, cameras, and other connected assets can flow into a unified platform with a geospatial layer, an information layer, and an orchestration layer. Time-lapsed visualizations can then let supply chain teams see how specific changes have impacted the ecosystem in the past—and make real-time decisions as situations unfold in the present.&nbsp;These simulations can also inform product development by helping teams identify where waste and inefficiencies can be removed from the process. As the report notes, "visibility of full product lifecycle management and environmentally sustainable products and services are two of the top automation priorities for operations functions over the next three years."&nbsp;By using gen AI to orchestrate multiple data sources, systems, and tools, supply chain leaders can inspire innovation across the ecosystem—and inform the strategic decisions that set their organization apart.<h2>Take action</h2>So, what can supply chain leaders do to predict and plan for endless disruption—and profit from the opportunities volatility can create? The report provides an action guide that outlines how to plan, prioritize, and perform to make every move count. This includes:<ul><li>Defining benefits and success criteria</li><li>Identifying key drop-out points between analysis and action</li><li>Investigating the key functionality and systems architecture needed</li><li>Understanding skills requirements and gaps</li><li>Keeping eyes on the prize and aligning supply chain innovation to market offerings</li></ul><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/supply-chain-ai">Download the report</a> now to learn more about the intuitive supply chain and how to predict disruption and deliver growth.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.    &nbsp;

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Predict disruption. Deliver Growth.

Transforming supply chain operations with AI

As AI continues to revolutionize industries, it's also raising significant concerns.&nbsp;Balancing the potential benefits of this technology with its ethical and regulatory implications is crucial, but it’s not easy. In fact, 80% of business leaders see AI explainability, ethics, bias, or trust as major roadblocks to adoption.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/roi-ai-ethics">A new report </a>from the IBM Institute for Business Value, written in collaboration with the Notre Dame—IBM Tech Ethics Lab, explores the importance of investing in AI ethics and governance while providing actionable steps organizations can take to improve in this area. &nbsp;<h2>A holistic AI ethics framework</h2>Investing in AI ethics is not just a moral imperative; it's a strategic business decision. 75% of executives view AI ethics as a key differentiator in the market.So how can organizations measure the impact of their AI ethics investments?&nbsp;Our report introduces a holistic AI ethics framework that considers three types of ROI to help organizations understand the value of their AI ethics investments and make informed decisions about allocating resources:The economic impact of AI ethics investments refers to the direct financial benefits, such as cost savings, increased revenue, or reduced cost of capital. For instance, an organization might avoid regulatory fines by investing in AI risk management. Additionally, AI ethics can help reduce the cost of data breaches, which can be a significant financial burden.The reputational impact of AI ethics investments refers to the intangible benefits, such as improved brand reputation, increased customer trust, and enhanced social responsibility. Prioritizing AI ethics allows organizations to demonstrate their commitment to social responsibility, which can lead to positive media coverage and improved customer satisfaction.The capabilities impact of AI ethics investments refers to the long-term benefits that arise from building capabilities that can be used across the organization. By investing in AI ethics, organizations can develop technical infrastructure, platforms, and expertise that may be applied to a wide range of business areas, leading to increased innovation, improved efficiency, and enhanced competitiveness.&nbsp;For example, an organization that develops a robust AI ethics framework may be able to apply that same framework to new AI initiatives, reducing the time and cost associated with implementing AI solutions.&nbsp;Similarly, an organization that invests in AI ethics training and education will likely be better positioned to develop a workforce with the skills and expertise needed to drive AI innovation, ultimately leading to increased competitiveness and revenue growth. &nbsp;<h2>Real world examples</h2>The report features seven real-world examples of organizations that have successfully implemented AI ethics and governance strategies.&nbsp;Deutsche Telekom, a leading telecommunications company, has established a comprehensive approach to AI ethics, As part of this effort, the company has created a high-level governance group to evaluate current and future AI initiatives and ensure compliance with data privacy and security procedures, including the EU AI Act.&nbsp;Deutsche Telekom's approach to AI ethics is centered around the importance of data as a fundamental element of any AI product. The company carefully considers who is exposed to data and how customer data is protected, and also prioritizes the protection of certain data segments related to sustainability and energy practices.&nbsp;Similarly, Fidelity Investments, a leading financial services company, has implemented an AI ethics program that includes a centralized AI Center of Excellence to oversee AI decision-making and ensure that AI is used responsibly and ethically.&nbsp;Fidelity Investments' approach to AI ethics is centered around the concept of "AI for good," which emphasizes the importance of using AI to drive positive outcomes for customers and society. This center resides in Fidelity’s data function and includes representation from each business unit at the firm, with roles ranging from risk compliance and audit to legal and even information security. This process also allows Fidelity to confidently answer clients’ increasing demands for information on its AI use and governance.&nbsp; &nbsp;<h2>Take the next step</h2><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/roi-ai-ethics">Read the full report</a> to discover how a holistic approach to AI ethics can help your organization thrive in the age of AI. You’ll also find a five-step action guide for optimizing your AI ethics investments.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.    &nbsp; &nbsp;

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Why organizations should invest in a holistic approach

Unlocking the value of AI ethics

In the era of gen AI, the most critical conversations might be the ones that aren't happening—and that's a risk business leaders can't afford to take.Today’s business leaders face a daunting challenge—harnessing the power of gen AI to drive growth and innovation while mitigating its risks. To succeed, executives must navigate complex technological landscapes and make smarter decisions that balance short-term and long-term goals.&nbsp;And now more than ever, they’ll need to work together.<h2>The 2024 global C-suite study series&nbsp;</h2>Every year, researchers from the IBM Institute for Business Value conduct dozens of research studies to identify the challenges and opportunities currently facing enterprise executives.&nbsp;Over the course of this year, we surveyed more than 50,000 global leaders on topics ranging from the impact of gen AI on business models and talent development to the role of finance and technology for driving innovation and growth. The data from these surveys and interviews is synthesized into robust, reliable thought leadership reports that help leaders make smarter business decisions.<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study">Our 2024 C-suite series</a> pinpoints key topics that CEOs ought to be discussing with their finance and tech leaders now as gen AI transforms industries and creates new opportunities for growth.<h2>When CEOs and CFOs meet over coffee, what should they talk about?</h2>CEOs and their CFOs must work together to determine their organization's risk tolerance and allocate finite budgets to drive growth and profitability in a gen AI-driven market. These two leaders need to prioritize investments in areas that can create the most value with gen AI, both in the short-term and long-term.&nbsp;This includes investing in talent development and upskilling their workforce to ensure they have the right capabilities to take advantage of gen AI. For example, they may need to ignite a talent revolution by analyzing workforce data to identify skills gaps, and determining whether to “buy, build, borrow, or bot” to fill those gaps.&nbsp;The conversation should also focus on how to make data the oxygen for their AI, and how to unlock AI potential with a unified data ecosystem. This involves discussing how to simplify data access, integration, and evaluation, and how to create a strong foundation for AI adoption.&nbsp;Ultimately, the goal of these conversations is to drive business success in a rapidly changing world. By working together, CEOs and CFOs can create and fund a strategic plan that allocates resources effectively to drive growth and profitability. This will require a proactive, agile, and data-driven approach, but the payoff will be worth it.&nbsp;<figure class="table"><table><tbody><tr><td>As one CFO noted, “You have to be able to understand the levers of your business and how each and every decision impacts your business—and then which potential levers you would have to pull with what amount and quantity or volume in order to compensate for that.”</td></tr></tbody></table></figure><h2>CEOs and tech execs should collaborate to reveal organizational blind spots</h2>As the gen AI era takes hold, CEOs and their tech leaders must have an urgent conversation about the strategic implications of this technology. With 72% of CEOs saying competitive advantage depends on who has the most advanced gen AI, the stakes are high, and the insight tech leaders have is crucial input.&nbsp;In many cases, tech leaders are being left out of critical leadership conversations. Their absence or ineffective participation has resulted in organizational blind spots in areas such as data, infrastructure, talent, and innovation.&nbsp;As CEOs and tech leaders plan, key topics should include how to:&nbsp; &nbsp;<ul><li>Position technology as essential to business outcomes and drive a culture of innovation.</li><li>Develop a hybrid-by-design infrastructure that delivers the flexibility, security, and scalability necessary for growth.&nbsp;</li><li>Prioritize a people-centric approach to technology operations that empowers their workforce.</li><li>Develop a responsible AI framework that cultivates a culture of integrity and transparency.&nbsp;</li></ul> During these conversations, tech leaders must position themselves as bold visionaries who can give life to a winning strategy by sharing their expertise. On the other side, CEOs must be willing to listen and adapt to the changing landscape driven by generative AI.<h2>Together, CFOs and their tech exec colleagues can make 2+2 equal far more than 4</h2>CFOs who recognize technology's transformative power are more likely to seize first-mover advantages and define markets. As gen AI continues to disrupt traditional business models, CFOs and tech execs must have an urgent conversation about the strategic implications of this technology.&nbsp;Many CFOs are not fully leveraging technology to drive business outcomes. While 62% of CFOs say their organizations are under pressure to accelerate ROI across their technology portfolio, only 35% of finance organizations engage in early IT planning with tech leaders to set expectations on how technology advances enterprise strategy. This is a missed opportunity.To drive business success in a rapidly changing world, CFOs and tech leaders must work together to champion tech as core to the business. This requires that CFOs shift from being financial overseers to strategic allies, where they work with their tech colleagues to drive transformation and support enterprise strategy with aligned technology initiatives.&nbsp;These leaders must support modernized finance IT and updated financial systems with cloud-based ERP to consolidate standalone legacy applications and standardize and integrate existing and new applications.&nbsp;As they discuss how to make execution the yin to strategy's yang, CFOs and tech leaders must prioritize investments that drive growth and profitability, determining their risk tolerance and placing big bets on technology investments that drive growth and profitability.&nbsp;<h2>Discover what C-suite leaders need to know—and do—to succeed in the age of gen AI</h2>The future is on the line. Leaders’ abilities to insert their essential expertise into enterprise decisions will ultimately determine their organizations' success in the AI era.But with the right strategy, leadership, and vision, organizations can thrive in this new era of technological disruption.&nbsp;Read our reports to gain a deeper understanding of the role each C-suite leader plays in this era of rapid technological change. Our research and insights will empower you to make informed decisions, drive transformative growth, and position your organization for long-term success. &nbsp;<ul><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo">2024 CEO Study: 6 hard truths CEOs must face</a></li><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/2024-cfo">2024 CFO Study: 6 power moves CFOs must make</a></li><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/cxo">2024 Tech Leaders Study: 6 blind spots tech leaders must reveal</a></li></ul> Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.  &nbsp;

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Essential conversations executive teams need to have now

The AI agenda

The financial services and insurance (FSI) industry is on the cusp of a revolution, driven by the rapid adoption of generative AI.&nbsp;And like any business revolution, there will be winners and losers. Insurance companies that fail to incorporate gen AI into their operations will likely fall behind their competitors, while those that seize the opportunity could gain a significant advantage.&nbsp;<h2>A measured leap into gen AI</h2>The insurance industry is facing a critical juncture, with customers increasingly demanding personalized products and services that meet their specific needs and preferences. Gen AI has the potential to deliver on this promise, but only if insurers are willing to take a deliberate and intentional approach to its implementation.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/insurance-generative-ai">A new report from the IBM Institute for Business Value</a> explores the current state of gen AI in the insurance industry, highlighting the benefits and challenges of implementing this technology. Our research shows that insurers using gen AI in their customer-facing systems are experiencing significant improvements in customer satisfaction, retention rates, and Net Promoter Scores.But building a better chatbot is only the beginning. Here's a preview of the opportunities described in the report:Tailoring products for the modern customerTo bridge the gap between consumer expectations and insurer capabilities, these companies must focus on understanding customer needs and concerns.&nbsp;One key practice is to "know your customer" by using gen AI to enable more accurate tailoring of products and services. This involves analyzing consumer data and call center best practices to understand customer wants, needs, and concerns, then using these insights to develop tailored products that match offerings to the customer's current life situation.&nbsp;By taking this approach, insurers can differentiate themselves from competitors and build stronger relationships with customers.<h2>Conquering complexity</h2>Insurers are struggling with complex aging IT landscapes that hinder innovation and limit their ability to adapt to changing market conditions.&nbsp;To overcome these challenges, insurers must "build AI across infrastructure" by assessing their technology landscape to determine how gen AI workflows can operate across that landscape, not just in one or two applications.&nbsp;Leaders must identify and break down data silos that limit AI integration and, instead, orchestrate AI across multiple constituent systems. This approach will enable insurers to modernize their technology architecture and leverage gen AI to help solve problems.<h2>A policy for success</h2>Read the report to discover how you can harness the power of gen AI to transform your insurance business.&nbsp;The report also includes an action guide with clear steps on how to modernize your technology infrastructure, drive innovation and competitiveness, and deliver personalized products and services that meet your customers' unique needs.&nbsp;Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.&nbsp;

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The future of insurance with generative AI

You can't win if you don't play

The digital economy is shifting at an unprecedented pace, with mainframes handling 70% of the world's transactional workloads and AI processing up to 30,000 transactions per second.&nbsp;But as transactional workloads continue to grow, mainframes are emerging as the linchpin of digital transformation, enabling organizations to drive business success and stay ahead of the competition.&nbsp;In this era of rapid change, companies that fail to modernize and integrate their mainframe applications risk being left behind, stuck with outdated systems that can't keep up with the pace of innovation.<h2>The backbone of digital transformation</h2>A <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/mainframe-hybrid-cloud">new report</a> from the IBM Institute for Business Value reveals the importance of mainframes in driving business innovation and growth.&nbsp;The report explores how Adaptive Enterprises are thriving in a hybrid cloud world and provides guidance on how to modernize mainframe applications to unlock new revenue streams, improve customer experiences, and gain a competitive edge.Here's a preview of what you’ll find:<h3>Integrating mainframe and cloud</h3>Hybrid cloud architecture is the norm for most enterprises, offering flexibility but also introducing complexity. When built piecemeal, hybrid cloud environments can lead to fragmented systems, silos, and higher costs. A hybrid-by-design approach can overcome these challenges by aligning hybrid cloud and digital transformation with key business goals.This approach recognizes the central role of mainframes in storing and sharing critical data and enables enterprise-wide integration. It allows organizations to leverage mainframe strengths in transaction processing and data security while harnessing the flexibility and scalability of public cloud-based solutions. A fit-for-purpose strategy ensures applications run in suitable environments.To realize the benefits, leaders must adopt a business-centric mindset, where business priorities drive technology decisions. They must ensure enterprise-wide integration, assign workloads to suitable computing environments, and consolidate operations and unify security and compliance policies. By doing so, enterprises can unlock higher ROI and achieve positive results in these areas.<h3>AI and mainframes</h3>Modern mainframes and AI are driving innovation and creating value together. IT executives rely on mainframes for storing and processing critical data and transactions, and are now turning to AI for enhanced decision-making, cybersecurity, and systems management. In fact, most IT executives agree that mainframes are essential for enabling AI-driven innovation and value creation.Modern mainframes provide a robust foundation for AI in-transaction workloads, allowing organizations to leverage state-of-the-art AI in virtually every transaction. With AI accelerators on mainframes, organizations can scale processing power and effectively use traditional AI models, large language AI models, and new Ensemble AI methods. This enables accurate and precise business outcomes, such as detecting payment fraud.In addition to driving business innovation, organizations are using AI with mainframes to enhance cybersecurity and operations. AI-powered mainframe management is becoming essential for innovating in fast-paced digital environments, with AI-powered automation, predictive analytics, and self-healing capabilities improving system reliability and optimizing workflows.&nbsp;By integrating AI into mainframe operations, organizations can proactively detect and prevent issues, and transform system management and maintenance.&nbsp;<h2>Unlock the full potential of digital transformation</h2><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/mainframe-hybrid-cloud">Read the full report</a> to learn specific steps you can take to optimize business value, modernize applications, and enhance mainframe operations. The report also discusses how to meet sustainability goals and boost cybersecurity performance.&nbsp;Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Discover why mainframes are the foundation for hybrid cloud optimization and AI innovation.

Mainframes are mainstays of digital transformation

The consulting industry is undergoing a significant transformation, driven by the rapid advancement of AI. This transformation is giving rise to a new era of consulting, one that is rooted in what IBM calls the science of consulting – a rigorous, evidence-based, and technology-enabled approach to delivering value to clients.&nbsp;As this technology continues to disrupt industries and professions, it presents both opportunities and challenges for consultants, including the need to adapt business models, skills, and delivery approaches to remain relevant.&nbsp;A <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/consulting-ai">new report</a> from the IBM Institute for Business Value explores how clients expect consultants to use AI to help them reimagine what's possible and deliver new forms of value creation.&nbsp;In this blog post, we'll provide a preview of the report's key takeaways and actionable insights.<h2>The rise of AI-enabled consulting</h2>Executives are planning to increase their overall consulting spend. But in return, they want consultants to deliver greater value with AI. In fact, 89% of buyers expect consulting services to incorporate AI for improved productivity and quality.To meet these expectations, consultants need to invest in developing AI-enabled capabilities that can be reused and adapted across multiple engagements.&nbsp;This includes developing AI assistants that can augment human expertise, creating reusable AI models and platforms, and building a repository of AI-enabled assets that can be used across different clients and projects.<h2>A new dynamic</h2>The traditional one-and-done consulting delivery model is giving way to a more symbiotic partnership between consultants and clients. In this new dynamic, consultants will focus on identifying widespread opportunities to improve business performance and designing solutions that deliver specific outcomes.&nbsp;This shift requires a technology-driven approach focused on evidence-based experimentation, continuous iteration, and user-centric design. Consultants must also be willing to co-create value with clients through ongoing collaboration and iteration. Doing so will help them deliver sustained business impact and forge long-term relationships that are based on mutual respect.<h2>Building a foundation of trust</h2>As consultants increasingly rely on AI to deliver services, building a foundation of trust with clients will become more important than ever. 93% of consulting buyers say they'll only use consulting services from organizations that are transparent in their use of AI.&nbsp;Consultants must prioritize governance, ethics, and security in their AI use, and ensure that clients understand how AI is used to drive value. This involves establishing clear policies and procedures for AI use, implementing robust data management and security protocols, and providing ongoing education and training to consultants on the responsible use of AI.&nbsp;<h2>Reboot your consulting strategy&nbsp;</h2>Read the full report to learn more about how AI is redefining the consulting industry and what it means for your business.&nbsp;You will also discover how you can work with partners and advisors who take a technology-fueled approach to consulting, and how to adapt your internal services model to consume internal services in the same way you are changing your use of consulting.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success. &nbsp;

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Consulting reimagined, Powered by AI

Small and medium enterprises (SMEs) form the backbone of the global economy, representing 90% of all firms, employing approximately 70% of the world’s workforce, and contributing 50% to global GDP. Despite the significant role SMEs play and the market relevance for banks, our recent study <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/small-medium-enterprises-banking">Banking for Small and Medium Enterprises</a> identifies divergent views among SMEs and the banks that serve them. Uncovering this white space presents an untapped opportunity for nimble institutions to compete in this varied market segment.SMEs face many challenges that go beyond access to finance, and which demand innovative banking solutions. To guide banks and fintech in their business strategy and technology investments, our study&nbsp;investigates the opinion of more than 1,200 SME owners and nearly 700 banking executives. Our research explores how SMEs imagine their primary banking relationship, and what they expect from their bank to grow, be efficient, meet compliance and risk management requirements.<h2>Banks as central actors in SME ecosystems</h2>Our findings reveal an interesting disparity between the perspectives of bankers and SMEs when it comes to choosing a bank. Overall, SMEs expect bankers to understand their unique business needs, offer tailored solutions, and facilitate networking with business partners and clients. In contrast, bankers tend to focus on the foundational aspects of banking, such as easy-to-use apps, dedicated banking managers, and the proximity of branches. Looking into survey data by jurisdiction, we observe nuances in the top three choices. SMEs in the US, the UK, France, and China also report branch proximity as one of their top three preferences. Many bank branches in major advanced economies have closed due to digital advancements and industry consolidation, often at a pace that does not align with how quickly clients are adapting to digital services. Conversely, SMEs in India highly value easy-to-use mobile apps, as the government-led intervention accelerated digital adoption throughout society.&nbsp; &nbsp;SMEs prefer banks that demonstrate deeper understanding of their sector and business ecosystems.&nbsp;<figure class="image"><img style="aspect-ratio:3000/2209;" src="/thought-leadership/institute-business-value/uploads/en/x_It5_F0_BUIX_7_Fldq_Yk_Tw_En_Y0_P_bc27e3a7fb.png" width="3000" height="2209"></figure> A widespread return to branch network expansion is unlikely, given client appreciation of the convenience and efficiency of digital banking. What is emerging is a blend of branch services, human relationships, and enhanced digital access to mold SME banking along the varied needs of their diverse clientele.&nbsp;<h2>Banks as expert advisors to plan for growth&nbsp;</h2>When it comes to the banking services that can facilitate growth, SME owners and managers tend to emphasize the importance of expert support in planning for expansion corroborated by market and economic analysis. In the US, key priorities include guidance for credit scoring, flexibility of funding options, and expert support in planning. Overall, SMEs recognize the role of banking stewardship as they seek trusted advisors who can provide counsel and navigate the complexities of business expansion. Fast access to funds also ranks high on their list of priorities, as SMEs need to minimize bureaucratic hurdles and save time. For these dynamic entrepreneurs, every moment counts, and cumbersome credit applications can be an obstacle to overcome.Bankers look inward, underestimating the SME need for fast money and expert advice to grow their businesses.&nbsp; &nbsp;<figure class="image"><img style="aspect-ratio:3000/2055;" src="/thought-leadership/institute-business-value/uploads/en/w_Hu0f_ZQI_Z_Xpu_R_Pr_Y_Ub_Ob47k_72ef493d61.png" width="3000" height="2055"></figure><h2>Banks as platforms beyond banking</h2>In the pursuit of optimizing business efficiency, SMEs place a premium on instant payments and streamlined digital access to all banking and non-banking services. As such, comprehensive super apps seem to appeal to SMEs not only in emerging markets but also across EU countries. These centralized platforms could provide a wealth of benefits, including enhanced decision-making facilitated by data-driven insights and cash flow forecasts. &nbsp;SMEs recognize the value of integrated ecosystem platforms with banking and non-banking services.<figure class="image"><img style="aspect-ratio:3000/2056;" src="/thought-leadership/institute-business-value/uploads/en/3_CL_ixit_V1jjv_J1_STH_6_C4jr_G_bbb63c49cc.png" width="3000" height="2056"></figure>A platform experience that embeds banking and non-banking services in the context of the daily life of SME businesses can liberate them from complexities that can stifle productivity and innovation. With an integrated solution, SMEs can redirect their energies toward strategic growth, creativity, and competitiveness, rather than being bogged down by administrative tasks. And by adopting an ecosystem approach, banks can connect the dots to foster long-term relationships.&nbsp;Winning the banking future by scaling AI enterprise-wide requires strong technical and cultural foundations. A practical governance of AI guides banks in the continuum of innovation and use cases application.<h2>Banks as compliance solvers, not burdens</h2>Finally, the survey uncovers a gap between the SMEs and bankers relative to the value banks can bring to mitigating risks faced by SMEs and addressing their compliance concerns. While SMEs crave guidance and support to navigate the complexities of compliance obligations and make informed decisions about sustainability, they also crave enhanced confidence in fraud monitoring.Conversely, bankers expect a greater interest from SMEs in insurance and financial hedging products. Rather than addressing these more advanced elements, SMEs first require guidance to address cumbersome compliance obligations. &nbsp;SMEs seek help to navigate regulatory complexity and sustainability considerations.&nbsp;<figure class="image"><img style="aspect-ratio:3000/1820;" src="/thought-leadership/institute-business-value/uploads/en/Yj_X8g_uzu_c_Yc_E_Ng_Vor_T_Si5_T_5e6a7889d3.png" width="3000" height="1820"></figure><h2>The value of time</h2>As bankers define new strategies to compete in SME markets, one element of value for their clients emerges as a constant. Time is money for SMEs and helping SMEs to save time in consuming financial services, and beyond, is a critical added value that creates differentiated client trust.&nbsp;Read now <a target="_blank" rel="noopener noreferrer" href="https://ibm.co/sme-banking">Banking for small and medium enterprises – serving the world economy with data and AI</a>.Our study findings are also enriched by the expert opinion of 10 executives who joined IBM Institute for Business Value to discuss how banks compete in diverse, dynamic SME markets. Read now&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/small-medium-enterprises-banking-makers">The Voice of the Makers</a> to learn from their strategic perspectives.You can&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to our newsletter to receive our studies.

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Banking for small and medium enterprises

Generative AI is shifting computing costs into high gear, and it's no longer solely an IT concern. The cost of compute is now a top priority for CEOs, as it can quickly lead to unexpected expenses that jeopardize innovation and business transformation.&nbsp;Understanding what drives the computing costs of gen AI can make all the difference in making informed investment decisions and setting strategic priorities.<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-cost-of-compute">A new report</a> from the IBM Institute for Business Value provides CEOs and business leaders with a comprehensive roadmap for managing the cost of compute and using generative AI to drive business transformation and innovation. &nbsp;<h2>Catalyze the costs&nbsp;</h2>To effectively manage the cost of compute, CEOs need to pinpoint the factors driving up gen AI expenses and stay ahead of the curve as projects scale.This includes identifying cost catalysts, such as data labeling, model customization, and training, then developing strategies to mitigate these expenses. It's also essential to recalibrate computing resources by conducting a full lifecycle cost assessment to preempt and anticipate compute needs.&nbsp;Additionally, FinOps and cloud optimization can help reduce costs and improve efficiency. For example, deploying Kubernetes can help manage workloads and services in containers, reducing the need for manual intervention and minimizing downtime. &nbsp;<h2>Hybrid by design makes scaling gen AI affordable</h2>Not every application of generative AI is created equal. Each use case has its own unique compute, data, and privacy requirements.&nbsp;That's why hybrid cloud, which allows organizations to use the most cost-effective infrastructure for every workload, is quickly becoming the go-to architecture for helping organizations achieve their gen AI goals at scale – without breaking the bank.&nbsp;To make the most of hybrid cloud, CEOs should extend hybrid cloud architectural principles across their technology estate to ensure consistency and scalability, design for modularity and flexibility to accommodate changing compute requirements, and measure success with clarity by establishing clear cost objectives and performance metrics. &nbsp;<h2>Don't let the cost of compute derail your gen AI plans</h2>Understanding the factors driving up expenses and taking control of your company's compute costs can empower you to unlock the full potential of your organization.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-cost-of-compute">Read the full report</a> to learn more about the CEO's guide to cost of compute and discover how to use hybrid cloud, gen AI, and optimization to achieve your business goals.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Move lightning-fast at a lower cost with gen AI and hybrid cloud

Get a grip on the cost of compute

Generative AI has rapidly become a business necessity, with 77% of leaders convinced that this tech is key to maintaining competitiveness.&nbsp;But as adoption grows, so do the risks, making effective gen AI governance crucial to building trust and mitigating potential regulatory and compliance issues.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ai-governance">A new report</a> from the IBM Institute for Business Value reveals the three essential trust factors for gen AI that can’t be ignored and clear actions you can take to address them.<h2>Trust factor 1: Accountability</h2>Establishing clear accountability is the first step in managing AI governance. This means empowering a senior-level executive to lead AI and data governance initiatives and providing the necessary resources to support this mandate.&nbsp;By building robust AI governance frameworks, organizations can minimize the risk of failure due to fragmented ownership and fuzzy accountability.&nbsp;In fact, our research shows that 60% of C-suite executives have placed clearly defined gen AI champions throughout their organizations, and almost as many have a direct report responsible for organization-wide AI integration.<h2>Trust factor 2: Transparency</h2>Transparency is key to earning user trust in AI systems. This requires providing explainability—the ability of an AI system to offer insights that people can use to understand the causes of the system's predictions.&nbsp;To achieve transparency, organizations must assemble a multidisciplinary AI governance team, including diverse experts from technical, ethical, and social domains. This team can help identify gaps faster, leverage existing governance mechanisms, and proactively head off unintended impacts.&nbsp;Moreover, training everyone in transparency is essential, as it enables employees to build or procure AI models responsibly and seek help when needed.<h2>Trust factor 3: Provenance</h2>Provenance—the ability to trace and verify the origins and history of data throughout its lifecycle—is essential for ensuring the trustworthiness of AI-generated insights and decisions.&nbsp;By designing AI systems that facilitate human-AI collaboration and oversight, organizations can ensure that AI models are built and governed responsibly. This includes prioritizing AI output that is explainable and auditable, incentivizing employees to speak up if AI output is confusing, and providing appropriate communication channels.&nbsp;Organizations must also recognize the importance of explainability, which informs provenance and enables people to trust AI outputs.<h2>Seizing the opportunity</h2>Championing AI governance at the leadership level will enable organizations to create a foundation of trust that will unlock the full potential of generative AI.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ai-governance">Read the full report</a> to learn more about how to address these three crucial trust factors, build confidence in AI governance, and unlock the power of generative AI.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success. &nbsp;

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Building trust in a world of generative AI

The enterprise guide to AI governance

Traditional operating models aren't equipped for today’s business.&nbsp;Our research found that a typical enterprise has an average of 78 handovers per major product initiative, so it's no wonder that speed and innovation are suffering. Moreover, these models often fail to engage millennials and Gen Z workers, who now comprise a significant portion of the workforce.<h2>A better scenario</h2>Across industries, a hybrid-by-design approach–which combines the flexibility of a hybrid cloud environment and the design thinking and collaboration of a human-centered approach–is evolving to support the growing use of gen AI applications.&nbsp;This requires a full redesign of operating models that goes beyond simply rethinking process flows. Leaders must also consider people and culture, with top-down encouragement and bottom-up embedding to drive change.<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/hybrid-by-design/hybrid-by-design-operating-model">In the 5th chapter of our 5-part series on the power of gen AI in hybrid cloud</a>, the IBM Institute for Business Value highlights the importance of adopting a hybrid-by-design approach to break down silos, eliminate handovers, and foster a culture of innovation and collaboration.<figure class="image"><img style="aspect-ratio:1456/728;" src="/thought-leadership/institute-business-value/uploads/en/1d_R_Xi_K999_Q_Qz_E_Nm_Jfw_RBA_eac109a913.jpg" width="1456" height="728"></figure> Here’s a preview of the report:<h2>Hack the handover</h2>Handoffs and indecision are killing velocity in today's operating models. Many enterprises are stuck in "operating-model-by-default" mode that leads to frustration, stagnation, and a lack of innovation. Decision-making is slow, and communication is muddled, with an average of six management layers between the C-suite and the front lines.&nbsp;A hybrid-by-design operating model can reduce handoffs and indecision by empowering the front lines, automating processes, and integrating data analysis and machine learning. In these models, you have a "single pane of glass" for centralized visibility, and process and workflow automation can reduce handoffs and free up employee time for more strategic work.&nbsp;The outcome is a decrease in operating costs by 40% to 70% within six months. But to make this work, you need to hack the handover by mapping the money trail, editing ruthlessly, and unleashing the hackathon heroes.<h2>The silent screams</h2>Employee disengagement is a flashing red light on the organizational dashboard, signaling something is wrong with your operating model. Leaders must focus on the people delivering outcomes, rather than just chasing KPIs. Common culprits include bureaucracy, lack of empathy, and self-serving managers. Employees will show where the operating model needs work, and leaders must listen to their concerns.&nbsp;To address these issues, leaders should put bureaucracy and hierarchy to bed by designing and documenting changes required for a hybrid-by-design operating model. This includes equipping employees for decentralized decision-making, incorporating anonymous feedback into AI models, and tracking key metrics such as idea leakage rate, fix-it-myself rate, and "Yes, but..." ratio.&nbsp;By focusing on people and culture, you can create a culture of innovation and collaboration that drives business outcomes.<h2>Don’t let your operating model hold you back</h2><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/hybrid-by-design/hybrid-by-design-operating-model">Download this report</a> – Built for flexibility: Why hybrid-by-design operating models are tomorrow’s enterprise foundation – to discover what a hybrid-by-design operating models can do for your organization.&nbsp;Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.&nbsp;

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Hybrid-by-design operating models are tomorrow’s enterprise foundation

Built for flexibility

Toss out the old playbook. As generative AI invites people to integrate technology into everything they do, siloed, top-down decision-making has become a barrier to innovation. Hierarchical structures and linear processes that once drove success are now recipes for sluggishness and failure.The question is, are CEOs ready to reimagine workflows and decision-making processes to make the most of gen AI?The <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-enterprise-operating-model">latest installment</a> of the CEO’s guide to generative AI from the IBM Institute for Business Value reveals how organizations can create the agile, adaptive, and interconnected operating models needed to embrace gen AI—while keeping chaos in check.Here are just a couple of key takeaways from the report:<h2>Reboot how your organization operates</h2>You can’t run tomorrow’s business with yesterday’s operating model, meaning that CEOs must rethink their approach. It’s tempting to harness the power of gen AI through centralized structures and deployment processes, but these are rarely consistent with the open innovation that is essential to transform workflows with gen AI.&nbsp;Instead, explore hybrid deployment models, such as the "hub and spoke" approach, in which a central team is responsible for developing, training, and maintaining gen AI models, while decentralized, cross-functional spoke teams focus on deploying, integrating, and customizing the models to meet specific needs.<figure class="image"><img style="aspect-ratio:1473/737;" src="/thought-leadership/institute-business-value/uploads/en/q_f_Mjz_ZV_Gsasawsb5_L_J74_O8_59c607acca.png" width="1473" height="737"></figure> These approaches can accelerate progress by balancing standardization and control with the need for flexibility and adaptability of gen AI tools across different business use cases.&nbsp;<h2>Scaling gen AI is everyone’s job</h2>As gen AI frees people to focus on higher-value tasks, roles are evolving faster than executives can update the org chart. The automation of routine tasks is putting greater emphasis on skills like creativity and critical thinking—and bringing a broader set of leaders into the gen AI conversation.Organizations must evolve their operating models to enable a cross-enterprise approach to gen AI adoption. This means breaking down silos and fostering a culture of collaboration and coordination. Leaders must establish clear goals and objectives for gen AI initiatives and provide a roadmap for implementation that aligns with business strategy.Empowering people to drive transformation is key. Fostering a collaborative culture of shared responsibility, inclusivity, and proactive engagement is essential. This means encouraging collective ownership of gen AI initiatives, giving executives and managers the education they need to become internal gen AI experts, and creating a participatory culture that encourages tackling the challenges of gen AI head-on.<h2>Change the rules of the game</h2>The rise of gen AI is disrupting traditional business models. To stay ahead, CEOs must reimagine their operating models and empower their teams.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-enterprise-operating-model">Read the full report</a> to discover the three things CEOs need to know and three things they need to do now to evolve their operating model for the gen AI era.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Why CEOs must rethink their operating model for generative AI

Your comfort zone is a danger zone

The generative AI era has arrived, and it's a make-or-break moment for CFOs. Finance leaders must be both guardians of stability and agents of change, working hand-in-glove with CIOs, CTOs, and other IT leaders to supercharge technology as the transformative force in their organization.As part of our global C-suite series, the 2024 CFO Study from the IBM Institute for Business Value reveals that leading CFOs are already making powerful moves to drive innovation and prepare for the future. But what sets these leaders apart, and how can other CFOs follow their lead?Our report explores six power moves that CFOs must make to succeed in this era.Here’s a preview of the first two moves:<h2>Power move #1: Champion tech as core</h2>When organizations treat technology as an enabler, they risk missing out on new opportunities and falling behind the competition. By recognizing technology as the transformative force at the core of innovation, organizations can seize first-mover advantages, define markets, and gain economies of scale.To champion tech as core, CFOs should proactively advocate for tech leaders' expertise in the boardroom, integrating evaluation, investment, and planning to ensure that technology initiatives align with the company's overall strategy. By doing so, CFOs can form a powerful coalition with CTOs, CISOs, and other tech leaders to drive growth.&nbsp;This requires a shift in mindset, from evaluating tech investments solely on financial returns to considering the broader operational, customer, and financial impacts. By taking this holistic approach, CFOs can harness the potential of technology, inform strategy, and capture value, ultimately driving innovation and competitiveness.<h2>Power move #2: Make execution the yin to strategy's yang</h2>As CEOs accelerate transformational objectives, CFOs must balance precision and agility while navigating a variety of new factors that influence operations.That’s easier said than done, and will require CFOs to adopt a more agile and adaptive approach to strategy execution. This means partnering across business units to translate high-level goals into financial targets and metrics while enforcing financial discipline by monitoring performance against objectives and benchmarks.&nbsp;By promoting a culture of accountability and empowering leaders to take ownership of their decisions and outcomes, CFOs can drive business evolution and ensure that execution is a reality, not just a promise.<h2>Start making moves</h2><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/cfo">Read the 2024 CFO Study</a> to learn more about the six power moves that CFOs must make in the generative AI era. The report also contains the findings of our survey of 2,000 CFOs and case studies about how finance leaders are driving transformation across industries.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.&nbsp;

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Tackling hard truths in the generative AI era 

6 power moves CFOs must make

Business leaders must be careful not to focus solely on how generative AI can simplify and automate today's processes—many of them are routine and mundane.&nbsp;While such measures may increase productivity, executives also have a rare opportunity to revolutionize employee potential and pioneer a new future for their organization.Forward-thinking organizations are increasingly framing AI strategies that extend beyond mere command and control and process steps.&nbsp;A new report from the IBM Institute for Business Value (IBM IBV) and Oracle, titled <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/human-potential-genai">Reimagine human potential in the gen AI era</a>, explains how HR can use AI to empower people to unlock their performance and potential by connecting them to what matters most for their job and personal goals.&nbsp;This is a chance to further humanize work. AI tools and data can help provide clarity on work roles and expectations, guide and coach employee development with purpose, and help foster employee progression and internal career mobility.<h2>Forecasting employee potential</h2>For example, leaders can take a proactive approach to forecasting the potential of their people by identifying the key skills and attributes that will be valuable going forward, such as critical thinking and emotional intelligence.&nbsp;Using data models to make informed predictions about future potential, organizations can ensure they're developing the right talent to drive business success. Additionally, leaders can encourage continuous learning and growth by providing opportunities for employees to develop new skills and take on new challenges.<h2>Encourage a culture of experimentation</h2>More than half of executives say that, in the next three years, generative AI will make entirely new types of work possible. It's all about starting small and moving fast to fail, learn, and scale more quickly. The biggest gains may come from stepping into the unknown.Leaders can encourage experimentation by creating an environment that supports calculated risk-taking and learning from failures. This can be achieved by fostering a culture of psychological safety, where employees feel comfortable sharing their ideas and learning from setbacks.&nbsp;By providing resources and support for employees to take on new challenges, leaders empower them to drive innovation and growth. And by recognizing and rewarding employees who demonstrate a willingness to experiment and take risks, organizations can reinforce a culture of experimentation and continuous learning.<h2>See the future of work</h2>Let’s reimagine human potential in the gen AI era to revolutionize work and boost business value.&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/human-potential-genai">Read the full report</a> to learn how you can take the reins and shape the future of your industry.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Revolutionizing work to boost business value

Reimagining human potential in the gen AI era

In today's fast-paced digital landscape, technology is no longer just a supporting function—it’s the driving force behind business success.With the rapid rise of generative AI, organizations are counting on tech leaders to deliver competitive advantage like never before.&nbsp;A new report from the IBM Institute for Business Value, titled <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/cxo">"6 blind spots tech leaders must reveal,"</a> explains that tech leaders are facing unprecedented pressure to deliver increasingly complex core IT services while building capabilities that enable their organization to achieve AI advantage.<figure class="table" style="float:left;width:100%;"><table class="ck-table-resized" style="background-color:hsl( 190, 55%, 96% );border:1px solid hsl(0, 0%, 60%);"><colgroup><col style="width:7.53%;"><col style="width:92.47%;"></colgroup><tbody><tr><td style="padding:10px;" colspan="2"><h2>The 6 blind spots</h2></td></tr><tr><td style="padding:15px;"><h2>1</h2></td><td style="padding:10px;">We treat tech as an enabler, but tech must be the core of everything we do.</td></tr><tr><td style="padding:15px;"><h2>2</h2></td><td style="padding:10px;">We say we are working together, but our collaboration is only skin-deep.</td></tr><tr><td style="padding:15px;"><h2>3</h2></td><td style="padding:10px;">We hope it will be a magic wand, but generative AI could break our organization.</td></tr><tr><td style="padding:15px;"><h2>4</h2></td><td style="padding:10px;">We want it to be trustworthy, but our AI may be irresponsible.</td></tr><tr><td style="padding:15px;"><h2>5</h2></td><td style="padding:10px;">We talk about data as currency, but our data could be a liability.</td></tr><tr><td style="padding:15px;"><h2>6</h2></td><td style="padding:10px;">We think our team is strong, but we’re still fighting yesterday’s talent battle.</td></tr></tbody></table></figure>&nbsp;To reveal and obliterate these blind spots, tech execs must be part mastermind, part maestro—architecting technology strategy, building multidisciplinary teams, and finding new approaches to collaboration with other C-suite leaders to drive enterprise-wide outcomes.&nbsp;This requires a deep understanding of the organization's goals, as well as the ability to communicate and integrate the value of technology in achieving those goals. &nbsp;<figure class="image image-style-align-center"><img src="/thought-leadership/institute-business-value/uploads/en/62_N0s9mh_NQJ_Kqrr77_J_m3xh_B_bdd650fb72.jpg" width="100%"></figure><h3> A roadmap for success in the AI era</h3>Our report provides a comprehensive guide for tech execs to insert their essential expertise into enterprise decisions, overcome blind spots, and better position their organizations for success.For instance, tech leaders can deepen collaboration by building relationships with finance leaders, recognizing that a strong partnership between technology and finance is critical to driving business outcomes. Initiate discussions with finance team members about which technology investments create the greatest competitive advantage. Model financial stewardship through transparency and accountability, regularly assessing and evaluating tech investments against business objectives.Tech executives can also avoid the risk of AI “breaking” your organization by assessing the current state of your infrastructure with an eye toward AI everywhere. Develop an AI transformation roadmap based on what’s needed to solve critical business problems, and optimize your cloud infrastructure for AI workloads that process and analyze large data sets.Finally, tech leaders can stop fighting yesterday’s talent battles by adopting a day-one mindset when it comes to their approach to talent in today's fast-paced AI landscape. Transform reskilling and upskilling into advancement opportunities. Establish AI academies or centers of excellence where employees can develop their proficiency. Keep high-value skills in house and leverage partners for easier-to-source tasks.<h3>The AI revolution starts with you</h3><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/cxo">Read the full report</a> to learn more specific actions your business can take to overcome these blind spots, elevate your technology strategy, and achieve AI advantage.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Elevating tech leadership to achieve AI advantage

The end of business as usual

<figure class="table"><table><tbody><tr><td style="border:1px solid hsl(0, 0%, 90%);padding:25px;">This blog is related to the latest chapter of The CEO’s Guide to Generative AI. To explore all chapters of the book,&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai">visit the website</a> or&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/downloads/cas/BN9Y6QPN">download the digital edition</a>.</td></tr></tbody></table></figure>&nbsp;Generative AI has the potential to create unprecedented value, but it also introduces new and complex risks that can have far-reaching consequences.As a result, many leaders are wary about this revolutionary technology. While 55% of CEOs see gen AI as an opportunity, 45% view it as a risk.But with the right approach, organizations can benefit from the scale and speed of gen AI without falling victim to unforeseen threats. &nbsp;<h3>Understanding the risks of gen AI</h3>In the latest chapter of the CEO's guide to generative AI, the IBM Institute for Business Value identifies three key takeaways for CEOs in regard to AI risks: &nbsp;1. Gen AI is unleashing a maelstrom of risks. Gen AI is introducing a wide range of new risks, from data breaches and cyber-attacks to regulatory non-compliance.&nbsp;2. Reputations are on the line. Gen AI has the potential to significantly impact an organization's reputation, both positively and negatively.3. The future is a threat multiplier. As gen AI becomes more widespread, the potential consequences of a major failure or breach will multiply exponentially.&nbsp; &nbsp;<h3>Managing risks and opportunities</h3>To stay ahead of these challenges, CEOs must set a risk threshold that fuels innovation, not chaos. This requires understanding the full spectrum of risks that gen AI introduces and a proactive approach to mitigating those threats.&nbsp;Leaders can maintain credibility with stakeholders by establishing processes to monitor and respond to reputational risks as they emerge. This involves predicting which risks are most likely to escalate and suggesting proactive strategies to keep the lid on heated situations.Finally, CEOs must prepare for “100-year risks,” which are rare but catastrophic events that can have long-term consequences. These risks are often unpredictable and can arise from any number of factors, including natural disasters, cyber-attacks, or supply chain disruptions.&nbsp; &nbsp;<h3>The roadmap to risk management</h3>For CEOs who want to unlock the full potential of gen AI while minimizing risks, the new chapter of the CEO's guide to generative AI provides a blueprint for success.&nbsp;By understanding the complexities of gen AI risk management and taking proactive steps to mitigate risks, CEOs can drive innovation, protect value, and transform potential threats into opportunities.<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ceo-generative-ai/ceo-ai-risk-management?utm_medium=Email&amp;utm_source=Outbound&amp;utm_content=IBVWW&amp;utm_term=20MFX&amp;utm_campaign=220336&amp;utm_id=OutboundMK1ENCTA1&amp;mkt_tok=Mjk4LVJTRS02NTAAAAGU7wyvC0nN1TLGQzcQ2gielioSZe72OY1MrDbUsWae2gxno7Hc2iyT3QYC-3z8z7Z5ww8abXC-xkHBkBWaReqW">Read the full report</a> to discover the three things every leader needs to know and three things they need to do now to improve gen AI risk management.Also, <a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/account/reg/us-en/signup?formid=urx-43376">subscribe now</a> to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.

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Strategies to improve risk management for generative AI

Navigating the uncharted territory

Executives rely on trusted, credible thought leadership, and that’s why we are so proud to announce that the IBM Institute for Business Value has been ranked the #1 thought leadership producer by Source Global Research for quality of thought leadership among leading consultancy and technology firms.&nbsp;The ranking, based on Source’s White Space quality assessment methodology, evaluates 19 leading consultancy and technology firms by reviewing a random sample of each firm’s thought leadership. The IBM Institute for Business Value (IBV) is IBM’s thought leadership think tank, and has appeared in the top three since 2012 when the ranking was first established, finishing in the #1 spot five times out of the last 13 years, including this year.The evaluation is based on four categories: differentiation, appeal, resilience, and prompting action. IBM appears in the top two in all categories, leading in appeal and prompting action.The four pillars of the Source methodology &nbsp;<figure class="table"><table style="border:1px solid hsl(0, 0%, 90%);"><tbody><tr><td style="padding:20px;vertical-align:top;width:150px;"><figure class="image"><img style="aspect-ratio:120/120;" src="/thought-leadership/institute-business-value/uploads/en/Ex_DQE_Wbdn_Euqy_o_Xwp_Pik_Jt_S_eec5cd01e0.jpg" width="120" height="120"></figure></td><td style="border:1px solid hsl(0, 0%, 90%);padding:20px;vertical-align:top;">Differentiation:<ul><li>Is this piece of thought leadership relevant to me right now?</li><li>Does it tell me something useful that I didn't know already?</li></ul></td></tr><tr><td style="padding:20px;vertical-align:top;"><figure class="image"><img style="aspect-ratio:120/120;" src="/thought-leadership/institute-business-value/uploads/en/fvs7a_K0df1_Oi_Fgxvzh_Tptk_L_20f6229e1f.jpg" width="120" height="120"></figure></td><td style="border:1px solid hsl(0, 0%, 90%);padding:20px;vertical-align:top;">Appeal:<ul><li>Am I encouraged to read on?</li><li>Is it easy and enjoyable to use?</li></ul></td></tr><tr><td style="padding:20px;vertical-align:top;"><figure class="image"><img style="aspect-ratio:120/120;" src="/thought-leadership/institute-business-value/uploads/en/xiv_Wmh4v64ur3_Sk_Jo_FU_9_A_Ne_T_2a0b7cafd7.jpg" width="120" height="120"></figure></td><td style="border:1px solid hsl(0, 0%, 90%);padding:20px;">Resilience:<ul><li>Can I trust what I am being told?</li><li>Do I know who is writing this and why I should believe them?&nbsp;</li></ul></td></tr><tr><td style="padding:20px;vertical-align:top;"><figure class="image"><img style="aspect-ratio:120/120;" src="/thought-leadership/institute-business-value/uploads/en/lw_L47_P_Ekcrv3_Zv4y238_B_Td_YM_4d9a9b1389.jpg" width="120" height="120"></figure></td><td style="border:1px solid hsl(0, 0%, 90%);padding:20px;">Prompting action:<ul><li>Do I have a clear sense of what I ought to do now?</li><li>Will a conversation with this firm be useful to me?</li></ul></td></tr></tbody></table></figure>&nbsp;The quality analysis includes this analysis by the Source evaluators:<blockquote>IBM excels in uncovering novel perspectives within familiar territories, often delving deeply into overlooked subjects, thereby crafting reports that stand out in both scale and depth.</blockquote><blockquote>With an even higher score than previous years, IBM continues to impress with its refined presentation and the seamless transition from engaging landing pages to well-designed reports. Its adept use of clear data visualization and compelling case studies enhances the appeal of the firm’s content. One report stands out:&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/seven-bets">Seven Bets: It’s Time to Bet on the Future</a>. From its captivating landing page to its well-structured content and compelling case studies, this report exemplifies IBM’s ability to create truly engaging and informative material.&nbsp;</blockquote><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/seven-bets">Seven Bets</a> was featured at IBM meetings during the 2023 World Economic Forum, and was presented to a standing-room-only crowd at the IBM Think conference in 2023 by&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.linkedin.com/in/salima-lin-b17bb71/">Salima Lin</a> and&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.linkedin.com/in/jmantas/">Jesus Mantas</a>.Three IBV reports also appear in the top 10, more than any other organization:&nbsp;<ul><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/quantum-readiness">Make Quantum Readiness Real</a>, which&nbsp;introduces a quantum readiness index and reflects the impact of preparedness. The Source analysts had this to say: This report features strong data visualizations, providing a clear and engaging representation of the findings. The specificity about how IBM can assist in quantum computing is particularly notable, as it highlights the company’s unique capabilities and resources. Additionally, the report’s recommendations are detailed and actionable, accompanied by numerous specific quantum resources and links. Overall, the piece demonstrates a high level of expertise in the field of quantum computing, making it a standout in its sample.</li><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/record-to-report-automation">Modernize Record to Report</a>, which illustrates how proper data management and the combination of automation and AI can modernize the record-to-report finance function.</li><li><a target="_blank" rel="noopener noreferrer" href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/women-leadership-2023">Women in Leadership</a>, a report co-published with&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://chief.com/">Chief</a>, which analyzes the reasons the pipeline of women in leadership roles continues to stagnate.</li></ul>Why is thought leadership important to executives?Fake thought leadership is everywhere – especially now when any fledgling prompt engineer can use generative AI to create content.&nbsp;Thought leadership is a critical tool for executives operating in uncharted territory. It provides provocative, evidence-based insights and lets business leaders explore challenges without the bias inherent in internal brainstorms. Building on primary research, external expertise, and practical examples, it delivers distinctive, evidence-based intelligence that helps leaders make smarter, faster business decisions. It&nbsp;builds trust and credibility—which may be why so many executives regularly spend time with thought leadership. IBV research shows that almost nine in ten (88%) executives say they spend about two hours each week consuming thought leadership.Why are they so invested? Almost all (96%) business leaders who consume thought leadership say they make better decisions as a result. And those results inspire them to take action: 87% of US executives say they made a specific purchase decision in the previous 90 days as a direct result of consuming thought leadership.So what IS thought leadership anyway?Thought leadership is a distinct type of content. It is a narrative that analyzes a business challenge using distinctive, evidence-based intelligence which results in insight that helps leaders make smarter, faster business decisions. There are three requirements for thought leadership that other types of content do not have:<ul><li>It must be evidence-based. Meaning it has to be backed by rigorous, credible research. It can’t simply offer a point of view or someone’s opinion like a blog, a podcast, or an explainer.</li><li>It must identify a new business challenge or examine an old business problem and deliver new insights. It can’t simply report or repeat what is already known like a news story or feature article.</li><li>It must offer actions that help leaders move toward a solution to the business challenge. However—and this is essential—thought leadership cannot veer into marketing or sales by pitching specific products or services like an advertisement or endorsement.</li></ul>Getting the definition and execution right matters because—as our research has revealed—the best thought leadership has a measurable and material impact on those who consume it. To influence decisions and drive long-term, mutually-beneficial client relationships, it must be bias-free, trusted, supported by data, and clearly actionable. When it is, it’s one of the best relationship-building investments any business can make.Because there is so much interest in, confusion about, and opportunity for thought leadership, the time is right for a professional association to represent those who produce bona fide thought leadership.&nbsp;Introducing the Global Thought Leadership Institute (GTLI)On 11 June, APQC, the organization known for quality, benchmarks and productivity, announced the establishment of a new&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.apqc.org/GTLI">Global Thought Leadership Institute (GTLI).</a> The GTLI is a not-for-profit organization advocating for the standardized practice, production, and promotion of high-quality thought leadership. Through its network of world class thought leaders, researchers, marketers, editors, designers, influencers, and others, GTLI promotes the development of distinctive, evidence-based intelligence that gives business leaders the insights they need to make better decisions.The IBM Institute for Business Value is a founding organizer of the GTLI, and holds two seats on the board of advisors, filled by&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.linkedin.com/in/anthonyejmarshall/">Anthony Marshall</a>, who serves as chair, and&nbsp;<a target="_blank" rel="noopener noreferrer" href="http://www.linkedin.com/in/clwanderson480">Cindy Anderson</a>. They are joined on the board by leaders from McKinsey, EY, KPMG, and Accenture.&nbsp;One of the first tasks this organization will undertake is to build a capability maturity model and metrics that measure the value of thought leadership, with a view to creating a certification framework for thought leadership.Congratulations to <a target="_blank" rel="noopener noreferrer" href="https://www.linkedin.com/in/salima-lin-b17bb71/">Salima Lin</a>,&nbsp;<a target="_blank" rel="noopener noreferrer" href="https://www.linkedin.com/in/pjkorsten/">Peter Korsten</a> and the entire IBM Institute for Business Value team on these important achievements!

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IBM Institute for Business Value ranked #1 thought leadership producer

As enterprises embark on generative AI initiatives, they require rich data sources that reflect their unique realities. ERP systems, such as SAP, hold this critical input.&nbsp;<a href="https://www.ibm.com/downloads/cas/WQVPW4JP">Recent research </a>from the&nbsp;<a href="http://www.ibm.com/ibv">IBM Institute for Business Value</a>&nbsp;reveals that organizations applying gen AI solutions to SAP data are experiencing greater profitability and are well-positioned to take full advantage of gen AI innovations.What's driving this synergy between ERP systems and gen AI? Three reasons stand out:&nbsp; &nbsp;<ol><li>Sheer volume and variety of data: ERP systems provide the foundation for gen AI models to learn and generate highly relevant outputs.</li><li>Inherent structure and organization of ERP data: This enables gen AI models to process information more efficiently and extract valuable insights with greater accuracy.</li><li>Intrinsic trust in ERP data: Since businesses rely on ERP systems for core operations, they strive to sustain accurate, well-maintained, and secure data, which boosts confidence in gen AI models trained on this data.</li></ol>&nbsp;To capitalize on this potential, organizations must think hard about the critical prerequisites to SAP-specific gen AI success. At a minimum, they must get their cloud infrastructure, talent, and governance right. By doing so, they can accelerate their gen AI adoption, drive innovation, and reap the benefits of SAP-specific gen AI initiatives.Critically, given the breadth of potential gen AI use cases, organizations must prioritize those activities that can be improved with gen AI solutions today and into the future. By urgently instituting enterprise-wide gen AI governance to keep gen AI priorities aligned to desired outcomes and by embracing strategies in support of the prerequisites outlined above, organizations can unlock the full potential of gen AI in ERP systems to drive innovation, growth, and profitability.&nbsp;<figure class="table"><table><tbody><tr><td style="width:150px;">&nbsp;</td><td><a href="https://www.ibm.com/downloads/cas/WQVPW4JP"><img src="/thought-leadership/institute-business-value/uploads/en/Gv_V_Am_AO_Wc_Fj3_Bdi_Sqi6icszu_fd1f5e0508.gif" width="339" height="55">&nbsp;</a></td><td style="width:150px;">&nbsp;</td></tr></tbody></table></figure>&nbsp;&nbsp;&nbsp;

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A practical on-ramp to innovation

Unlocking the power of gen AI in ERP systems

New forces and trends are reshaping law enforcement and public safety

Law enforcement is changing more rapidly than ever before. New forms of crime, advanced technologies, and evolving relationships with citizens and communities are challenging and shifting the very foundations and scope of law enforcement and public safety and how organizations and the officials perform their critical mission.

As a result, new processes, new tools and new strategies are urgently needed to equip law enforcement and public safety personnel with the resources and capabilities required to focus on core, value-added mission functions. Success will require deep understanding and adoption of new technologies, coupled with cultural and organizational changes. As emerging technologies drive new business and service models, governments must be prepared to rapidly create, modify, and enhance policy and regulatory frameworks to help ensure they&rsquo;re leveraged effectively and responsibly and maximize value to the communities they serve.

New technological developments are resulting in an explosion of data that is reshaping the law enforcement mission

There is an ongoing convergence of key digital technologies that have the potential to transform the way law enforcement officers work and perform their critical function of protecting and serving communities. Key disruptive technologies include 5G mobile communications, artificial intelligence (AI), data analytics, and the Internet of Things (IoT). Independently, each of these technologies have the potential for significant impact; however, the combination of these technologies is poised to create unprecedented opportunities to significantly augment the capabilities of law enforcement and public safety personnel and to significantly improve mission outcomes. The explosion of real time data available to organizations can accelerate the adoption of AI systems that will augment human capabilities. AI represents machine-based intelligence, typically manifested in &quot;cognitive&quot; functions that humans associate with other human minds.&nbsp;There are a range of different technologies involved in AI including machine learning, natural language processing, deep learning, and more. Cognitive computing involves self-learning systems that use data mining, pattern recognition, and natural language processing to mimic the way the human brain works.

AI has many potentially beneficial applications in law enforcement including (pre-) processing large amounts of data (e.g. from confiscated digital devices, police reports or digitized cold cases), finding case-relevant information to aid investigation and prosecution, providing easier to use services for civilians (e.g. with interactive forms or chatbots), and generally enhancing productivity and paperless end-to-end workflows. It can be used to promote human rights, dignity, freedom, equality, solidarity, democracy and rule of law. AI also helps socialize the tacit knowledge across the organization and improves collaboration beyond organizational boundaries.

The Challenges of AI, Human and Machine Interaction

The heart of new investigative analytics and similar tools is human-machine integration. The idea is not to have digital technology replace humans that perform critical law enforcement and public safety functions, but rather to have it augment their capabilities, allowing each to work to focus on and leverage their strengths. Digital technology can crunch massive volumes of data to pull out clues a human could never find, while the human can adapt it for context, understand circumstances, and interact with other humans.

While AI is indeed a very promising technology that could provide many benefits to law enforcement and public safety missions, it is important to be aware of its limitations as well as understanding and ensuring the ethical and responsible use of AI. This is imperative to begin to remedy common misconceptions people have about the use of this technology. Established and accepted guidelines and legal frameworks for the ethical use of AI (e.g., the <a href="https://www.europarl.europa.eu/RegData/etudes/BRIE/2019/640163/EPRS_BRI(2019)640163_EN.pdf" target="_blank">EU Ethics Guidelines for Trustworthy AI</a>, <a href="https://www.consilium.europa.eu/en/press/press-releases/2022/12/06/artificial-intelligence-act-council-calls-for-promoting-safe-ai-that-respects-fundamental-rights/" target="_blank">EU Artificial Intelligence Act</a>, the <a href="https://oecd.ai/en/ai-principles">OECD AI Principles</a><a href="https://oecd.ai/en/ai-principles" target="_blank">, Australia&rsquo;s AI Ethics Principles</a>) continue to emerge and will constantly evolve. These frameworks will help set guidelines for the development and use of this technology and AI-enabled systems and capabilities will need to be adaptable to these new standards and regulations.

Building on Momentum to Strengthen Readiness

IBM and the <a href="https://www.mi-labs.de/#projects" target="_blank">Munich Innovation Labs</a> have been working on a series of innovations to leverage AI to help enhance the role of the law enforcement and public safety personnel while also ensuring its responsible use. These innovations include the following: 
&nbsp;

<ol>
	<li>Leveraging AI to detect hate speech: Create standards and harmonize practices to capture threat intelligence from internal and external data sources through an ecosystem of security tool integrations and open-source intelligence (OSINT) feeds to help public safety agencies detect and share threat data faster and prepare preventive actions against crime. 
	&nbsp;</li>
	<li>Gaining efficiency and automation in a very fragmented system: AI is a complex technology, but it is critical that AI is human-friendly, usable, fair, trustworthy, and explainable. There are a set of use cases that demonstrate how to design and build AI applications that are transparent and maintain human control of decision making throughout all processes.&nbsp; 
	&nbsp;</li>
	<li>Collaboration across national boundaries: Data Analytics and AI contribute to knowledge sharing across countries and help improve law enforcement. Lessons learned from different countries are being analyzed to accelerate the right adoption of technology and its adherence to the <a href="https://www.europarl.europa.eu/RegData/etudes/BRIE/2019/640163/EPRS_BRI(2019)640163_EN.pdf" target="_blank">EU Ethics Guidelines for Trustworthy AI</a> and the <a href="https://www.consilium.europa.eu/en/press/press-releases/2022/12/06/artificial-intelligence-act-council-calls-for-promoting-safe-ai-that-respects-fundamental-rights/" target="_blank">EU Artificial Intelligence Act.</a> 
	&nbsp;</li>
</ol>

New and emerging technologies have the ability to help law enforcement and public safety organizations keep pace with advances in criminal capabilities and evolving mission requirements. &nbsp;Organizations like the <a href="https://www.mi-labs.de/" target="_blank">Munich Innovation Labs</a> and other major nonprofit organizations, are envisioning the ways these new technologies can enhance the missions of these organizations and developing recommendations based on real-world use cases to help organizations around the world better prepare for the future.

Over the coming months, we plan to convene a series of discussions with global experts and share lessons learned through a series of blogs outlining strategies and solutions for governments to address the challenges that lie ahead. We encourage you to contact us (<a href="https://www.linkedin.com/in/cristina-caballe-77516938/" target="_blank">Cristina Caballe</a>, and <a href="https://www.linkedin.com/in/markus-straub-16978320/" target="_blank">Markus Straub</a>) directly to learn more. Stay tuned for the next blog on &ldquo;Leveraging AI to detect hate speech.&rdquo;

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How emerging technologies can transform law enforcement and public safety

The COVID-19 pandemic exposed governments to a host of mostly unexpected challenges. And while leaders have captured many lessons, it is questionable if they have fully embraced them.&nbsp;

Over the past two years,&nbsp;governments around the world have navigated&nbsp;and responded to the impacts of&nbsp;the pandemic.&nbsp;Throughout this journey,&nbsp;governments have captured valuable lessons and gained an understanding of critical areas of focus. But government leaders are now telling us they fear what were previously viewed as rare Black Swan events are now becoming more frequent&mdash;and more destabilizing.

One event follows closely on the heels of another, or even multiple events are occurring at the same time. For example, the COVID-19 pandemic was still ongoing when the unthinkable happened&mdash;the Russian invasion of Ukraine leading to deteriorating international relations. Various climatic/environmental challenges are occurring around the world, such as <a href="https://news.sky.com/story/southern-france-lashed-by-heavy-rain-thunder-and-flooding-12407846" target="_blank">severe flooding in France</a>, both <a href="https://www.theguardian.com/australia-news/2022/mar/10/parts-of-australia-suffer-drought-and-low-rainfall-as-la-nina-and-climate-change-create-weather-extremes" target="_blank">drought</a> and <a href="https://en.wikipedia.org/wiki/2019%E2%80%9320_Australian_bushfire_season#cite_note-:2-2" target="_blank">bushfires in Australia</a>, and <a href="https://www.cnn.com/2022/05/04/us/california-drought-water-restrictions-climate/index.html" target="_blank">water shortages in California</a>. And we are experiencing the economic fallout from the pandemic and the war, which has even the <a href="https://www.worldbank.org/en/news/press-release/2022/06/07/stagflation-risk-rises-amid-sharp-slowdown-in-growth-energy-markets" target="_blank">World Bank concerned about a period of stagflation</a>. Governments must develop the agility and resiliency to protect against and respond to this plethora of challenges.

Recognizing recent successes

While many stories detail the troubles the world has faced, it is important to remember where governments have successfully delivered extremely valuable solutions and services for their constituents (albeit after some delay) over the past few years.&nbsp; IBM has partnered with government agencies to navigate the pandemic; for example:

<ul>
	<li>The Italian Ministry of Health and the Red Cross built a <a href="https://www.ibm.com/blogs/client-voices/machine-learning-keeps-ambulance-transport-on-schedule/" target="_blank">predictive platform for ambulance transport times</a>, fully integrated with the national healthcare system allowing for multiple layers of analytics. As a result, data collection, driver shift management, invoicing of completed trips, and much more were greatly improved.</li>
	<li>In the United States, New York State launched the <a href="https://newsroom.ibm.com/Digital-Solutions-Help-Support-New-York-State-with-Reopening-Plans" target="_blank">nation&rsquo;s first state-run vaccine passport</a>, allowing easier verification of vaccine status and test results.</li>
	<li>In Rhode Island, the state built a <a href="https://www.ibm.com/case-studies/state-of-rhode-island-ibm-consulting/" target="_blank">cloud-based data lake and automated processes</a> to enable faster, more sophisticated, and more reliable analysis. Within three weeks, the data team was disseminating deeper COVID-19 insights needed to guide policy and operational decisions and keep the public informed.</li>
	<li>The US Department of Defense (DoD) ordered the creation of the <a href="https://www.ibm.com/downloads/cas/YODO9EVN" target="_blank">Joint Artificial Intelligence Center (JAIC)</a> with the goal of enabling teams across DoD to swiftly deliver innovative AI-enabled capabilities and effectively experiment with new operating concepts in support of US DoD&rsquo;s disaster and humanitarian response to the pandemic.</li>
</ul>

Governments have had two years to learn from grappling with the pandemic. They have improved stability to the point where they are no longer forced to think minute-to-minute but can look into the future and imagine what &ldquo;shocks&rdquo; may come next.&nbsp;

What do we mean by &ldquo;shocks&rdquo;

Shocks are events with severely disruptive consequences. They could be rapid- or slow-onset, or regional or global. While the scope and nature of a particular shock can vary, each requires governments to be prepared to coordinate a response (see figure).

Shock events typically begin locally, and their impacts spread rapidly through contamination or contagion to societies and economies. Regional shocks are limited to a specific geographic area or sovereign state(s) and include events such as climate-related or other natural disasters and cyber events/attacks on economies or critical infrastructure.

Rapid-onset shocks, such as wildfires, have immediate impacts requiring urgent action. However, not all shocks are immediate and come as a surprise. Slow-onset shocks, including environmental risks resulting from climate change, provide more time for impacted governments and societies to adjust, react, and mitigate impact.

&nbsp;

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The bottom line is that future shocks of all kinds are likely to happen more and more frequently, and governments can&rsquo;t afford to assume a reactive posture. The time to act&mdash;the time to prepare&mdash;is now. If the pandemic taught us anything, it is that governments have a responsibility to anticipate and be ready for the worst.&nbsp;

Preparation priorities

In our client conversations, we have distilled the lessons captured from pandemic-era experiences&mdash;both positive and negative&mdash;into <a href="https://www.businessofgovernment.org/node/4547" target="_blank">four core themes</a> that are fundamental to continuing and accelerating government transformation and to preparing for the future:&nbsp;

<ul>
	<li>Rapid innovation and agility&mdash;Many governments, even those caught off-guard by the pandemic, quickly shifted to rapid innovation and modernization.</li>
	<li>Trust and transparency&mdash;Providing essential services and averting economic collapse are further complicated by demands from citizens for protection, personal liberty, and equity.</li>
	<li>Security&mdash;The stress of the pandemic exposed existing gaps in cybersecurity and critical infrastructure security and created new ones.</li>
	<li>Talent and transformation&mdash;The workers of today need to become the workers of tomorrow by learning the new skills and technologies that are expected to become ubiquitous among government workforces.</li>
</ul>

Within each of these areas, governments need to develop insights as to what is required to continue to build resiliency and anticipate future shocks. Readiness requires governments at all levels to prioritize leadership attention and investments as well as define and orchestrate strategies to address challenges in several key domains. Governments need to build a set of core capabilities to be better prepared for the future. Those capabilities can be organized within the following 6 strategic domains:

<ul>
	<li>Emergency preparedness</li>
	<li>Supply chain</li>
	<li>Cybersecurity</li>
	<li>Sustainability</li>
	<li>Workforce development</li>
	<li>Cross-border coordination.</li>
</ul>

Let&rsquo;s look at each domain in more detail.

Renewed investment in emergency preparedness is required to cope with the increased frequency of regional and global rapid-onset events. Nations need to be ready to cope with a serial outage in the Critical National Infrastructure (for example, power supply, gas). Potential vulnerabilities touch all parts of government and society, including the 16 sectors whose &ldquo;assets, systems, and networks, whether physical or virtual are considered so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety&rdquo; as identified by the <a href="https://www.cisa.gov/critical-infrastructure-sectors" target="_blank">Cybersecurity and Infrastructure Security Agency</a>. Emergency and preparedness response can&mdash;and must&mdash;be improved to withstand the threats of the today&rsquo;s world.&nbsp;&nbsp;&nbsp;

Another key focus area is modernizing supply chains. Supply chain leaders have struggled with how to maintain supply chain continuity in the face of current disruptions. While many agencies felt that they had diversity in their supplier base, they realized that most of those suppliers were actually going to the same source&mdash;companies with distribution centers located in China. <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/smarter-supply-chains" target="_blank">In IBM Institute for Business Value (IBV) research</a> we found that 93% of organizations have faced challenges associated with demand volatility. Leaders are expressing new urgency in redesigning supply chains for control, integrity, and dynamic agility while identifying new models that can avoid breakdowns better than the traditional &ldquo;just-in-time&rdquo; approach. To mitigate the risks of future disruptions, supply chains must be reimagined to allow for real-time visibility and auditability as well as dynamic, AI-enabled responsiveness, all while helping to manage the integrity and security of the supply chain ecosystem. Opportunities for modernization exist from the front end to the back end of the supply chain and everywhere in between.

Reinforcing the security imperative and cybersecurity for Critical National Infrastructure is another critical domain. 2021 was a record year for cyberattacks. <a href="http://www.fastcompany.com/90715622/cyberattacks-ransomware-data-breach-new-record-2021" target="_blank">Data breaches jumped 23%</a> over the previous all-time high set in 2017, and <a href="https://www.fastcompany.com/90715622/cyberattacks-ransomware-data-breach-new-record-2021">ransomware attacks doubled</a> the past 2 years in a row. High-profile attacks through SolarWinds and Microsoft Exchange Server, and on the Colonial Pipeline infrastructure, to name just a few, demonstrated how closely <a href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/government-digital-transformation" target="_blank">cybersecurity is tied to business continuity and operational resilience</a>. <a href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/zero-trust-security" target="_blank">A recent IBV report</a> found that &ldquo;70% of organizations are unable to secure data that moves across multiple cloud and on-premises environments&rdquo; and &ldquo;92% of organizations lack the ability to securely enable and extend new cloud-native capabilities to their internal and external partners.&rdquo; Governments must act to bolster security capabilities that protect both public- and private- sector institutions&rsquo; assets within the Critical National Infrastructure.

Over the next decade, <a href="https://www3.weforum.org/docs/WEF_The_Global_Risks_Report_2022.pdf" target="_blank">8 of the top 10 global risks</a> identified by the World Economic Forum (WEF) are environmental or societal, with climate action failure, extreme weather, and biodiversity loss topping the list. In a <a href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo" target="_blank">recent IBV study</a>, 57% of government CEOs identified increasing sustainability as a top priority in the next 2-3 years compared to just 48% of CEOs from all industries. Government leaders clearly see that it is vital to accelerate the green agenda for sustainability, energy transition, and climate change. Nations and regions need to be prepared to address an increased frequency of rapid-onset climate/environmental catastrophes (such as, flooding and wildfires) and take actions to address slow-onset climate-related events.

Rapid technological advances, increased globalization, and unprecedented industry disruption are destabilizing traditional job roles and fueling a global skills crisis. <a href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo" target="_blank">In a recent IBV study</a>, a third of government leaders identified inadequate skills and resources as one of the greatest challenges facing their organization. To avoid negative repercussions within their organizations as well as for individuals and economies worldwide, government leaders must work to deepen the talent pool and build the workforce of the future by upskilling and reskilling talent. <a href="https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/government-digital-transformation" target="_blank">They must build and maintain a workforce</a> with the skills necessary to meet organizational responsibilities in the face of rapid technological advances and increased competition for top talent in local and regional labor markets.

Globalization and the level of interconnectedness between countries has grown for decades. Just as the COVID-19 pandemic ignored borders and boundaries, so must the response systems that governments put in place to prepare for future shocks. They must strengthen cross-border coordination. It is vital that governments work with allies, trading partners, and neighboring sovereign states to help ensure cross-border response systems are constantly ready for fast, rigorous, and efficient responses to global events.

Building on momentum to strenghthen readiness

Governments should prepare for future shocks.&nbsp;IBM, working through the&nbsp;<a href="https://www.businessofgovernment.org/" target="_blank">IBM Center for the Business of Government</a>&nbsp;and the&nbsp;<a href="https://www.ibm.com/thought-leadership/institute-business-value/" target="_blank">IBM Institute for Business Value</a>,&nbsp;and in partnership with the&nbsp;<a href="http://www.napawash.org/" target="_blank">National Academy of Public Administration</a>&nbsp;(NAPA) and other major nonprofit partners, expects that these six domains will be most critical to building resilience.&nbsp;Further, we envision governments carrying the momentum they created from rapid pandemic-driven innovation into their preparation for future shocks.

Collaborative action to address anticipated threats requires focus and cooperation across a broad ecosystem of partners and stakeholders, but every step forward helps build progress toward addressing the <a href="https://napawash.org/grand-challenges/the-12-grand-challenges" target="_blank">Grand Challenges in Public Administration</a> put forth by NAPA. Over the coming months, we plan to convene a series of roundtable discussions with global experts from across the public and private sectors to curate and share lessons learned in each of these domains and to identify strategies and solutions for governments to address the challenges that lie ahead.

We welcome your thoughts and perspectives and invite you to contact us directly (<a href="https://www.linkedin.com/in/mikestone1/" target="_blank">Mike Stone</a>, and <a href="https://www.linkedin.com/in/tim-paydos-857197/" target="_blank">Tim Paydos</a>) to learn more.

<a href="https://www.businessofgovernment.org/node/4547" target="_blank">Listen to the podcast interview with Michael J Keegan</a>, Leadership Fellow, IBM Center for The Business of Government

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Preparing governments for future shocks

With the rise in global warming-induced severe weather events, insurance regulators and institutions have placed a greater emphasis on sustainability. Sustainability drives the need for insurers to mitigate risk in underwriting and help ensure business continuity in case of catastrophic events. And while climate change impacts every industry, it has some of the greatest implications for insurance institutions due to their broader risk exposure. In fact, in 2021 alone, natural disasters <a href="https://www.reuters.com/markets/commodities/natural-disasters-cost-insurers-120-billion-2021-munich-re-says-2022-01-10/" target="_blank">cost insurers</a> $120 billion, <a href="https://www.businessinsider.com/cost-of-climate-change-natural-disasters-homeowners-billions-insurance-fema-2022-1" target="_blank">up from</a> $100 billion in 2020 and $52 billion in 2019.&nbsp;

A recent <a href="https://www.ibm.com/thought-leadership/institute-business-value/c-suite-study/ceo" target="_blank">IBM Institute for Business Value (IBV) study</a> surveyed 3,000 CEOs, including 150 insurance leaders in 40 countries, to better understand their priorities relating to sustainability. The survey found that 44% of insurance CEOs identify increasing sustainability as a top priority over the next 2-3 years. Believing that sustainability is critical in business and financial risk assessments, insurance CEOs are engaging their Chief Financial Officers on sustainability at a higher rate, 55%, compared to their peers at 47% across industries. And 83% of insurance leaders also expect sustainability investments to produce improved business results within the next 5 years.

As underwriters of risk and major institutional investors, insurance institutions are considering sustainability in their business operations in multiple ways:

<ol>
	<li>Insurers are looking at their investment portfolio, beginning to divest from fossil fuels, and increasing their investment in sustainable business models. This investment in sustainability encourages progress in other sectors. &nbsp;</li>
	<li>As severe weather becomes more common, the job of underwriters becomes more complex. To deal with this, insurance institutions are creating stronger underwriting models that gather more data from more sources to predict risk more accurately and to identify hidden risk concentration.</li>
	<li>Insurers are considering how to more actively manage risk, both through policy advocacy and pricing, and by partnering with the insured to build more resilient behavior.</li>
	<li>Regulators are demanding reporting on climate and sustainability exposure more and more, requiring more active data gathering and management by insurers.</li>
</ol>

Advanced technology and green software are at the helm of driving sustainability forward for insurers 

What is the top barrier to achieving sustainability business objectives? Insurance CEOs say it&rsquo;s an unclear ROI and economic benefits of sustainability initiatives. That&rsquo;s where IT and exponential technology can help, including data, artificial intelligence, and cloud.

Artificial intelligence captures, aggregates, and analyzes data that can be used to create personalized solutions to manage climate-related risks in a repeatable, provable way. For example, The Weather Company,&reg; owned by IBM, is using AI capabilities to develop leading-edge technologies that measure and analyze an array of geospatial, water, and climate data. The insights from this data help insurers understand how natural ecosystems are impacted and take preventive actions. AI can also tailor risk alerts to elicit action from insureds to materially reduce their risks.

Cloud computing technology offers another way for insurers to contribute positively to sustainability. Data centers <a href="https://www.computerworld.com/article/3431148/why-data-centres-are-the-new-frontier-in-the-fight-against-climate-change.html" target="_blank">are expected</a> to make up 3.2% of global emissions by 2025, and insurance institutions still own and run many of them. IBM has an end-to-end approach to measure, analyze, and optimize the carbon footprint for sustainable hybrid cloud environments. In the UK, for example, IBM Cloud&reg; already uses a network of data centers that are powered 100% by renewable electricity.

Insurers can tackle the difficulties of climate change with new business models 

Climate change presents an opportunity for the insurance industry. As severe weather wreaks havoc on our world and challenges insurance underwriting, these institutions can leverage hybrid cloud and AI to build more sustainable business models. This approach can ultimately support business continuity and help insurers build new products to meet the needs of our changing world.

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Insurers with a focus on sustainable business operations powered by modern technologies can underwrite and manage climate change risks better.

Climate change is a major challenge for insurers, but AI and cloud can help

In the past decade, companies, their stakeholders, and society at large have focused more attention on business&rsquo;s role in sustainability as the effects of climate change have become more apparent. But over the past year, something changed for CEOs worldwide. Sustainability talk turned into action as continued disruption&ndash;including upheaval from the pandemic&ndash;thrust an even greater spotlight on climate change with society calling for a transformation of economic activities and business priorities.

Transformational sustainability starts with a mindset that makes sustainability an integral part of an organization&rsquo;s values and business strategy, fundamentally reshaping business models as well as delivering on community needs.&nbsp;One way banks and financial institutions can drive this transformation is by embracing digital technologies strategically and operationally to drive sustainability outcomes while expanding economic opportunities.

In this context, unlike most other industries, banking and financial market institutions (BFM) have two key ways they can execute on the world&rsquo;s agenda for transformational sustainability:

<ol>
	<li>Leverage exponential technologies, like data, AI and cloud, to measure and embed sustainability into their IT architectures and applications - looking to opportunities beyond simply responding to regulatory demands to reduce the environmental footprint of their operations (consistent with other industries).</li>
	<li>Aid retail and corporate clients engaged in sustainability and help address return on investment concerns by better allocating financing and investments supporting the world&rsquo;s transition to a &ldquo;green economy&rdquo; and other sustainable outcomes. (BFM-specific)</li>
</ol>

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Therefore, sustainability is both an operational challenge and a business opportunity. In <a href="https://www.ibm.com/thought-leadership/institute-business-value/c-suite-study/ceo" target="_blank">a recent IBM Institute for Business Value study</a>&nbsp;that polled over 3,000 CEOs, including nearly 300 banking and financial market executives in 40 countries, we found that 80% of BFM CEOs expect sustainability investments to improve business results in the next 5 years. BFM leaders also recognize that executing promptly on transformational sustainability is among the top 3 operational challenges, preceded only by heightened cyber security risks and demanding regulations. CEOs feel the pressure from their Board members (72%) and community of investors (57%) who are calling for radical transparency about their sustainability programs. To respond, BFM CEOs are engaging a wide swath of their leadership teams and departments to make the right investments in sustainability initiatives. BFM CEOs have taken a broader approach than CEOs in other industries starting with engagement of their Chief Financial Officer (69%) and Chief Operations Officer (45%).

Accelerating sustainability is about mindset shift in the usage of exponential technologies

The leadership teams of banks and financial services institutions are engaged to reduce the environmental footprint, measuring their own sustainability while investing in exponential technology like data, artificial intelligence, and hybrid cloud.

We know that a company&rsquo;s transition to hybrid cloud is an essential business approach, but it is also an important factor in sustainability. Transforming the operating model - how the workforce collaborates and operates with workflows on hybrid cloud - allows for a more energy-efficient usage of data centers and computing environments. According to the IDC, cloud computing could <a href="https://www.idc.com/getdoc.jsp?containerId=prUS47513321" target="_blank">eliminate a billion metric tons</a> of CO2 emissions over the next four years.

The transformation of banks&rsquo; data centers is an opportunity to further advance sustainability by increasing the adoption of renewable energy sources. In the UK, for example, IBM Cloud already uses a network of data centers that are powered 100% by renewable electricity. In Spain, BBVA <a href="https://www.bbva.com/en/sustainability/bbva-reduces-co-emissions-and-energy-consumption-of-its-data-center-processors-by-50-with-ibm-technology/" target="_blank">upgraded their data centers</a> leading to the reduction of the firm&rsquo;s energy use by 50% and, in a period of five years, expect to cut BBVA&rsquo;s carbon gasses in half.

As financial institutions adopt a hybrid cloud approach, a massive amount of data now exists, which can help financial firms and companies in all industries understand their environmental footprint. However, that data largely remains scattered across different databases, systems, and locations, making it hard for all stakeholders to access and understand. AI-powered software can help businesses take advantage of sustainability insights across their operations. This can make an impact in areas like:

<ul>
	<li>extending the life of physical assets,</li>
	<li>creating more efficient and resilient supply chains,</li>
	<li>understanding the impact of acute climate events and chronic physical climate risk, and</li>
	<li>analyzing and reporting on ESG data and initiatives.</li>
</ul>

This is key as good governance of data, AI and IT leads to better sustainability.

Sustainability data and insights underpin relevant business opportunities for financial services ecosystems

<blockquote>
Sustainability has become an opportunity to differentiate and expand financial services businesses.
</blockquote>

By the end of 2021, 265 banks representing more than 45% of global banking assets had signed up to the UN&rsquo;s &ldquo;Principles for Responsible Banking,&rdquo; leading to the development of products and solutions to meet these sustainability commitments. This commitment has included a greater focus by financial institutions on tracking financed emissions, forcing the companies they invest in, in all industries to examine and reduce their carbon footprint. Sustainability, therefore, has become an opportunity to differentiate and expand financial services businesses.

Our new CEO study reveals that executives in all industries feel pressure about executing on sustainability, amidst business challenges and uncertainty. 59% of the world&rsquo;s CEOs indicate that unclear return on investments (ROI) and economic benefits are the biggest challenges in achieving their sustainability objectives, and 44% mention lack of insights from data.&nbsp;Banks and financial institutions closely monitor and rely on other industries&rsquo; transparency regarding their sustainability initiatives. In this regard, they are instrumental in mitigating the sustainability concerns of all other industries, granting short- and medium-term value in terms of financial levers.

Banks provide sustainable financing and prioritized access to capital markets through preferred inclusion in sustainable investment products for institutional and retail clients. Banks and fintechs are also collaborating to orchestrate sustainability-oriented data platforms that allow their ecosystem of clients and partners to extract value from participating in a standardized and transparent exchange of information.

An action guide to accelerate sustainability as a business opportunity

In <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/2022-banking-financial-markets-outlook" target="_blank">a 2022 global outlook report</a>, IBM draws from 12 months of research with leaders in the financial services industry and found a top imperative for banks today is in finding viable sustainability models that balance business value and stakeholder expectations. &nbsp;The industry is now developing and deploying initiatives to meet these commitments, while helping ensure targeted investments deliver on overall business and financial objectives.

These initiatives are emerging across 4 broad areas:

<ul>
	<li>Incorporating climate and sustainability data and insight to help manage risks,</li>
	<li>addressing the sustainability of banking operations&mdash;the financial industry&rsquo;s journey to net-zero,</li>
	<li>developing new products and services to support the sustainability agenda, and</li>
	<li>reporting on sustainability performance.</li>
</ul>

&nbsp;

Shanker Ramamurthy is the Managing Partner of IBM&rsquo;s Global Banking &amp; Financial Markets consulting practice, President of the IBM Industry Academy and a board member of the Banking Industry Architecture Network.

Brigid McDermott leads IBM&rsquo;s industry technology focus as General Manager, Global Financial Services at IBM.

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Financial institutions hold the keys to unlocking sustainability within their own operations and across industries 

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Pathways in transformative sustainability: banking CEOs own their impact

Over the past several months, we have shared a series of articles&mdash;from building a robust <a href="https://www.ibm.com/thought-leadership/institute-business-value/blog/covid-19-foundation-stronger-resilient" target="_blank">analytic foundation</a> for increasing situational awareness to transforming <a href="https://www.ibm.com/thought-leadership/institute-business-value/blog/covid-19-digital-citizen-services" target="_blank">digital citizen services</a>&mdash;focused on how governments can emerge stronger and more resilient from the COVID-19 pandemic. Here we focus on process innovation and agility.

The pandemic has forced nearly every organization to change the way that it works. In some cases, organizations have had to completely reinvent their operating models to continue delivering mission-critical services. Some government agencies faced massive workload increases and had to address huge increases in demand for services. They faced this challenge even as their own workforces were directed to leave government facilities and work remotely.

Initially, things went poorly and many government systems designed to provide critical services <a href="https://reason.org/commentary/state-unemployment-websites-crash-as-covid-19-shines-light-on-government-technology-failures/" target="_blank">crashed</a>. After this stuttering start, many leaders used digital technology to make <a href="https://nextcity.org/urbanist-news/entry/from-the-covid-19-crisis-to-rebuilding-our-public-technology-infrastructure" target="_blank">significant strides</a> in resolving delivery issues. Some became agile. They <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">cut cycle times</a>, reduced costs, and improved services. They deployed new capabilities in weeks, not months or years.

Digital engagement across all industries jumped ahead by years during COVID-19, and government was no exception. <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/covid-19-future-business" target="_blank">Research</a> from the IBM Institute for Business Value found that the COVID-19 pandemic accelerated digital transformation at 59% of surveyed organizations. Similarly, over half of government executives surveyed said digital transformation was a priority.

Focusing on agility and redesigning workflows

Embracing the new urgency to harness technology, leading governments scaled to meet demand, delivered entirely new services, and supported new ways of working.

At <a href="https://www.ibm.com/blogs/watson-health/social-security-scotland/" target="_blank">Social Security Scotland</a>, a social program management platform underlies user-centered, agile transformation. More than 2,400 citizens, civil servants, and non-profits collaborated to build a single case management platform for social benefits. Over the course of 2 years, 7 social programs were deployed on the platform designed to ultimately deliver benefits to about 1.8 million people. The cloud-based platform integrates a variety of technologies to deliver a virtually seamless citizen experience. It scales up and down to meet demand and eliminates the ongoing expense of purchasing, housing, and maintaining an on-premises infrastructure for these programs.

The <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">US Department of Veterans Affairs</a> applied process automation and intelligent workflows to help improve citizen service and cut costs associated with manual, paper-driven processes. The Department uses AI and process automation to digitize incoming benefits packages and correspondence, cutting processing times from <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">5 to 60 days</a> to hours. Within just 8 months, <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">200</a>&nbsp; people handling piles of paper were retrained for new positions. While modern technology played a huge role, these changes were underpinned by a fundamental culture shift that embraced innovation. Innovation was a must. There was no other way.

Tapping into modern technologies on the transformation journey

Looking ahead, government transformation and continued investment in modernization initiatives will remain imperatives. <a href="https://www.idc.com/getdoc.jsp?containerId=US47907021" target="_blank">IDC reports</a> that, for both public and private sector organizations, customer satisfaction, operational efficiency, and innovation are the three top focus areas for the future. By building on lessons learned from the COVID-19 response, governments can continue to cost-effectively improve service delivery.

During the height of the pandemic, the most successful governments identified critical priorities and rolled up their sleeves to focus on core issues. They commissioned diverse teams of people from across their organizations and communities to define issues and opportunities for improvement. They used <a href="https://www.ibm.com/garage?utm_content=SRCWW&amp;p1=Search&amp;p4=43700055082249585&amp;p5=b&amp;gclid=CjwKCAjw7--KBhAMEiwAxfpkWIp23ImkpKw_AyiN6RWN61XT3PW0J_u81-liLeCcpbyJTPSTdSS5uRoCn5oQAvD_BwE&amp;gclsrc=aw.ds" target="_blank">Design Thinking</a> to focus on end users and develop solutions that people would adopt.

Many organizations also discovered that <a href="https://searchsoftwarequality.techtarget.com/feature/Low-code-app-platforms-prove-essential-in-times-of-crisis" target="_blank">low-code platforms</a> can provide the agility to quickly deploy new capabilities and minimum viable products (MVPs). These platforms also can enable fast iteration and rapid deployment of new functionality beyond MVPs. They are transforming citizen engagement, internal processes, and transactions across the ecosystem.

Cloud computing has also proven to cost-effectively support the pace required for progress. Cloud servers and resources can be added in minutes&mdash;far faster than deploying new hardware on premises. That speed and associated scalability can deliver cost efficiencies. Users pay for what they need when they need it and can avoid purchasing, maintaining, and managing equipment in a data center.

But cloud is only part of the answer. Governments are complex enterprises and successfully run technologies that are decades old. They maintain large amounts of their own technology while also buying services and solutions that cross many different clouds. This has generated increasingly complex and diverse technical environments. Governments need to cost-effectively manage that infrastructure without creating new ranks of specialized IT operations teams. It can be done, using <a href="https://www.kyndryl.com/services/cloud/multicloud-management" target="_blank">new technologies</a> that make it possible to run workloads across multiple clouds and government data centers from &ldquo;a true single pane of glass.&rdquo;&nbsp;&nbsp;

Maintaining momentum and moving forward with purpose

The pandemic has provided a massive stress test for business and operating models, new technologies, and agile deployment methods. In confronting this generational challenge, leaders around the world have found ways to improve citizen services, streamline processes, and even reduce back-office costs. They have demonstrated the power of technology to boost government performance and meet unprecedented demands for services and benefits. They have crafted road maps of success and foundations for sustainable improvement. Governments must persist and build on this momentum to continue transforming operations to enrich citizen services.

While there have been many positive lessons, some governments have experienced unsettling new challenges, such as expanding complexity, security gaps, and a sense of loss of control. All of these can be addressed. We encourage you to contact us (<a href="https://www.linkedin.com/in/paul-dommel" target="_blank">Paul Dommel</a> and&nbsp; <a href="https://www.linkedin.com/in/mikestone1/" target="_blank">Mike Stone</a>) directly to discuss and learn more.

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COVID-19 Phase III—Process innovation and agility to emerge stronger and more resilient

Health is a shared value. As we map out a more equitable future for <a href="https://www.ibm.com/thought-leadership/institute-business-value/blog/healthcare-mapping-sustainable-future" target="_blank">healthcare beyond the pandemic</a>, advancing health equity and improving community health must be part of the conversation.

Health disparities are the unfair differences in health and health outcomes that result from unequal access to goods, services, or opportunities. They can occur because of race, ethnicity, gender, income, disability status, or geography, among other factors.

It is <a href="https://www.ncbi.nlm.nih.gov/books/NBK425844/" target="_blank">widely recognized</a> that health disparities are associated with a higher burden of disease. The COVID-19 pandemic laid bare the underlying issues that put vulnerable populations and community health at increased risk. For example, Latino, Indigenous, Black, and Pacific Islander Americans die of COVID-19 at <a href="https://www.apmresearchlab.org/covid/deaths-by-race#data" target="_blank">double or more the rate</a> of white and Asian Americans. What&rsquo;s more, 10 upper-income countries have received the vast majority of COVID-19 vaccines, according to the <a href="https://www.who.int/campaigns/vaccine-equity" target="_blank">World Health Organization</a>. If only vaccines had been distributed equitably, it says, there would have been enough shots to immunize every healthcare worker and older person in the world.

Despite many valiant efforts, health equity remains elusive. But data and technology can help. To channel their power toward addressing health disparities, the healthcare and life sciences industries should consider 3 core principles:

1. Commit to transparent, complete data collection

Organizations that collect, store, manage, or process data have an obligation to handle it responsibly. IBM, for example, outlines its beliefs and practices in the <a href="https://www.ibm.com/blogs/policy/dataresponsibility-at-ibm/" target="_blank">IBM Commitment to Data Responsibility</a>.

Organizations that commit to responsible data stewardship can better address health disparities and social inequities by re-examining how they collect, disaggregate, analyze, and report data. Broad data categories such as Black, white, Hispanic, Asian American/Pacific Islander, and American Indian/Alaska Native ignore variations in risk, exposures, and resilience within populations. Likewise, excluding relevant characteristics that influence health, such as income, education, neighborhood social capital, or income, further perpetuates inequities.

Accurate, complete data is critical to helping organizations monitor the impact of their health equity programs, understand the real drivers behind improved health outcomes, and allocate their resources appropriately.

Complete data collection also can help create health equity in biomedical research, particularly when it comes to <a href="https://www.hlth.com/digital-content/hlth-matters/blog/prioritizing-women-in-scientific-and-clinical-research" target="_blank">prioritizing women in scientific and clinical research</a>. For instance, underrepresentation of women as clinical trial participants, researchers, and leaders has contributed to incomplete data, poorer health outcomes, and what <a href="https://doi.org/10.1186/s13293-020-00308-5" target="_blank">one research team</a> called &ldquo;sex inequality that hides in plain sight.&rdquo;

2. Collaborate to enable patient-centered care for all

Achieving health equity requires <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/phm" target="_blank">collaboration across multiple stakeholders</a>, including healthcare providers, payers, employers, life sciences companies, and government agencies, all of whom must work together to create a healthier future.

For example, healthcare providers can partner with community organizations to help address social needs. Healthcare payers, meanwhile, can prioritize and pay for patient-centered care teams. And life sciences companies can use <a href="https://www.ibm.com/blogs/watson-health/the-future-of-clinical-trials-is-now/" target="_blank">decentralized trials</a> to help vulnerable populations participate in studies. Patient-centered care should be integrated into virtually all aspects of care delivery, including value-based payment models.

Access to and integration of data are the 2 most essential requirements for successful population health management, <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/phm" target="_blank">according to providers</a>. Enabling secure access and shared data can help facilitate more personalized care. Combining several types of data&mdash;for example, claims, clinical, labs, genomics, wearables, and <a href="https://www.ibm.com/blogs/watson-health/5-examples-of-using-social-determants-for-population-health/" target="_blank">social determinants of health</a>&mdash;enables a more comprehensive longitudinal health record with which to make more informed healthcare decisions.

When organizations collaborate with communities, more accurate and comprehensive data sets are possible. Essential to this collaboration is a meaningful discussion around data <a href="http://www.ibm.com/thought-leadership/institute-business-value/report/ai-ethics" target="_blank">trust, transparency, and ethics</a>. Organizations that exercise social responsibility can be a powerful influence on the values of their members or stakeholders.

3. Use artificial intelligence (AI) and analytics to measure what matters and surface new insights

Organizations must measure progress toward health equity as they would any other aspect of performance. As part of its 100 Top Hospitals&reg; program, for example, IBM Watson Health recently introduced a <a href="https://newsroom.ibm.com/2021-04-27-Fortune-and-IBM-Watson-Health-Recognize-Top-Performing-U-S-Hospitals-and-Health-Systems" target="_blank">new measure</a> of hospitals&rsquo; contributions to community health. This measure focuses on equity, along with measures of clinical outcomes, operational efficiency, patient experience, and financial health.

There is great potential value in <a href="https://www.ibm.com/blogs/watson-health/applying-machine-learning-to-population-health/" target="_blank">applying machine learning to population health challenges</a>, especially as organizations collect and manage larger and more diverse types of data. For instance, machine learning helped IBM uncover correlations between COVID-19 mortality rates with sociodemographic traits such as race, HIV prevalence, and unemployment rate.

Discovering correlations between social determinants of health and population health challenges can help healthcare providers tailor interventions. We must, however, remain vigilant that AI and machine learning do not inadvertently perpetuate biases. IBM Research has therefore developed&nbsp;<a href="https://www.ibm.com/blogs/research/2018/09/ai-fairness-360/" target="_blank">AI Fairness 360</a>, a comprehensive open-source toolkit of metrics to check for unwanted bias in data sets and machine learning models.

The time to act is now

A more equitable future in healthcare and life sciences is possible&mdash;if we work together to achieve it. Please <a href="mailto:idankwa@us.ibm.com">contact me</a> or <a href="mailto:wfelix@ibm.com">Winnie Felix</a> to learn more about how IBM Watson Health can help your organization innovate in pursuit of health equity.

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Healthcare beyond the pandemic: Innovating to advance health equity

In many countries, the COVID-19 pandemic exacerbated the long-present and wide gap in service quality between the private and public sectors. Governments suddenly faced enormous pressures on some services. For example, as many as <a href="https://tcf.org/content/commentary/1-in-4-workers-relied-on-unemployment-aid-during-the-pandemic/?agreed=1" target="_blank">1 in 4 workers</a>&mdash;more than 46 million people&mdash;received a form of unemployment insurance.

System failures across the US and countries <a href="https://www.anao.gov.au/work/performance-audit/services-australia-covid-19-measures-and-enterprise-risk-management" target="_blank">around the world</a> were common. After a crush of newly jobless residents overwhelmed Florida&rsquo;s online and phone systems, citizens <a href="https://www.cnn.com/2020/04/07/politics/florida-unemployment-benefits-covid/index.html" target="_blank">lined up</a> to obtain paper applications for unemployment benefits. <a href="https://www.theguardian.com/australia-news/2020/mar/23/queues-at-centrelink-offices-and-mygov-website-crashes-ahead-of-coronavirus-shutdowns" target="_blank">Australia</a> and other countries experienced similar hardships. Many people had never filed for unemployment benefits or interacted with unemployment insurance systems or processes. Few were impressed.

Both private and government organizations had to adapt&mdash;and quickly. <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/covid-19-future-business" target="_blank">Research</a> from the IBM Institute for Business Value found that the pandemic accelerated digital transformation at 59% of surveyed organizations. Similarly, given the pandemic&rsquo;s impact on government, just over half of government executives surveyed said digital transformation was a priority.

Although their initial response was slow, many public sector organizations made <a href="https://nextcity.org/daily/entry/from-the-covid-19-crisis-to-rebuilding-our-public-technology-infrastructure" target="_blank">significant strides</a> to resolve service issues. Numerous governments achieved years of changes in months. Leaders identified new ways to educate students and shift work from offices to homes. Administrations implemented massive changes in process and technology to scale up and meet unprecedented demand for social benefits services. Skyrocketing fraud added to the challenges, but investigations and counter-fraud solutions have led to <a href="https://www.oig.dol.gov/doloiguioversightwork.htm" target="_blank">hundreds</a> of indictments and convictions.&nbsp; &nbsp;

Digital engagement across all industries jumped ahead by years during COVID-19, and government was no exception. Governments need to build on this progress to cost-effectively improve service delivery going forward. By capturing lessons learned, they can continue their advancements to drive further impact.

Innovating with modern technology to meet citizen need.&nbsp;

Embracing the new urgency to harness technology, leading governments scaled to meet demand, delivered entirely new services, and supported new ways of working. For example, governments across the globe set up <a href="https://newsroom.ibm.com/watson-assistant-thrive" target="_blank">AI-powered virtual assistants</a> to answer millions of questions per day. Some agencies went even further and used the technology to seamlessly conduct transactions like scheduling appointments, paying for licenses, or even processing paper benefit applications. This approach can not only improve citizen service, but, according to <a href="https://www.gartner.com/smarterwithgartner/rethink-customer-service-strategy-drive-self-service" target="_blank">Gartner</a>, effective self-service channels can be 80 to 100 times less costly than time-consuming live interactions.&nbsp;

The <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">US Department of Veterans Affairs</a> applied process automation and intelligent workflows to help improve citizen service and cut administrative costs associated with manual, paper-driven processes. The Department used AI and process automation to digitize incoming benefits packages and correspondence, cutting processing time from <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">5 to 60 days</a> to hours. Within just 8 months, <a href="https://www.aptiveresources.com/case-study/veteran-intake-conversion-and-communication-services-viccs-mail-automation-services" target="_blank">200 people</a> handling piles of paper were retrained for new positions. Improvements continued and the Department began to use a similar solution to speed <a href="https://www.g2xchange.com/statics/va-awards-40m-vba-foia-pa-processing-services-task-to-ibm/" target="_blank">Freedom of Information Act (FOIA) Request processes</a>. While modern technology played a huge role, these changes were underpinned by a fundamental culture shift that embraced innovation. Innovation was a must. There was no other way.

Keep moving forward with lessons learned

Not every new system deployed during the pandemic was a success. In fact, some vaccine scheduling tools were considered <a href="https://www.theguardian.com/world/2021/jan/28/coronavirus-vaccine-appointments-older-americans" target="_blank">difficult to use</a>. What&rsquo;s more, many citizens <a href="https://spectrum.ieee.org/telecom/internet/to-close-the-digital-divide-the-fcc-must-redefine-broadband-speeds" target="_blank">lacked access</a>&nbsp;to broadband internet and were not able to easily get into these systems.

The more successful governments identified critical priorities and rolled up their sleeves to build resilient solutions. They created diverse teams of people from across their organizations and communities to define issues and opportunities for improvement. They used <a href="https://www.ibm.com/garage?utm_content=SRCWW&amp;p1=Search&amp;p4=43700055082249585&amp;p5=b&amp;gclid=CjwKCAjw7--KBhAMEiwAxfpkWIp23ImkpKw_AyiN6RWN61XT3PW0J_u81-liLeCcpbyJTPSTdSS5uRoCn5oQAvD_BwE&amp;gclsrc=aw.ds" target="_blank">Design Thinking</a> to focus on end users and develop solutions that people would adopt. They kept things simple, often eliminating steps that should not exist. Finally, they teamed with technology partners that brought insights, experience, and tools for the journey.

The transformation imperative and need for continued investments is not over. In fact, leaders in both government and the private sector are continuing to focus on customer experiences and efficiency. <a href="https://www.idc.com/getdoc.jsp?containerId=US47907021" target="_blank">IDC reports</a> that the top 3 focus areas for the future, for all organizations, are customer satisfaction, operational efficiency, and innovation.

Yet, as governments have become more comfortable with transformation at pace, some have experienced unsettling new challenges: security gaps, expanding complexity, and a sense of losing control. All of these can be addressed. Disciplined approaches can drive fast results and address important considerations for long-term success. We will be writing more on these themes over the next several months.

We encourage you to contact us (<a href="https://www.linkedin.com/in/paul-dommel" target="_blank">Paul Dommel</a>, <a href="https://www.linkedin.com/in/nick-holmes-3b0a6915/" target="_blank">Nick Holmes</a>, and <a href="https://www.linkedin.com/in/mikestone1/" target="_blank">Mike Stone</a>) directly to learn more. Although we can&rsquo;t predict the future, we can forge a path forward that is productive, improves the lives of taxpayers, and can be more secure for all of us.

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COVID-19 Phase III—Digital citizen services to emerge stronger and more resilient

The globalized supply chain is a &ldquo;hidden hand&rdquo; underpinning our economy and society. For the last several decades, a vast ecosystem of suppliers, logistics providers, and buyer brokers has partnered to optimize this extended supply chain and increase efficiency while cutting the cost of capital.

We all depend on this global supply chain for our food, clothing, fuel&mdash;indeed, our very livelihoods and security. And it has become increasingly complex, integrated, and fragile.

The domino effect

In March 2021, strong winds helped cause a single ship, the <a href="https://www.bbc.com/news/business-56559073" target="_blank">Ever Given</a>, to run aground and block the entire Suez Canal&mdash;through which 12% of global trade passes each day, representing 30% of all global container traffic and over $1 trillion worth of goods annually. As a result, 369 massive cargo ships came to a complete standstill&mdash;holding up an estimated <a href="https://www.bbc.com/news/business-56533250" target="_blank">$9.6 billion</a> in trade along the waterway per day. What&rsquo;s more, the global price of oil spiked <a href="https://www.usnews.com/news/top-news/articles/2021-03-25/oil-prices-rebound-on-fears-suez-canal-blockage-may-last-weeks" target="_blank">4%</a>, and commodity price indices in Europe grew 5%.

The fact that a single vessel can impact the cost of beef on the other side of the world underscores supply chain interdependence in a globalized world.

That had become clear a year earlier, when the Black Swan COVID-19 hit with all its attendant challenges. Almost overnight, we saw <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/covid-19-supply-chains" target="_blank">disruptions to the supply of goods</a> that were unimaginable just days prior. As consumers, we all have our personal stories to tell&mdash;perhaps you were unable to purchase paper products or eggs at your local grocery store.

The problem was not that the world had run out of toilet paper or poultry, but rather that we had too much product packaged in transit in the commercial supply chain&mdash;hotels, restaurants, and office buildings&mdash;and not enough in the retail and consumer supply chain.

On March 12, 2020, demand for consumer <a href="https://fortune.com/2020/05/18/toilet-paper-sales-surge-shortage-coronavirus-pandemic-supply-chain-cpg-panic-buying/" target="_blank">paper products</a> jumped 734%. The following month, US dairy farmers reportedly were dumping 3.7 million gallons of <a href="https://www.nytimes.com/2020/04/11/business/coronavirus-destroying-food.html" target="_blank">milk</a> a day. The worldwide crude oil surplus reached an <a href="https://www.nytimes.com/2020/04/20/business/oil-prices.html" target="_blank">all-time high</a>. And while the global food distributor <a href="https://www.supplychaindive.com/news/Sysco-earnings-warehouse-truck-driver-hiring-pandemic-recovery/594579/" target="_blank">Sysco</a> furloughed 33% of its workforce in the summer of 2020, <a href="https://www.thepennyhoarder.com/make-money/amazon-hiring-spree/" target="_blank">Amazon</a> hired 100,000 new employees, mostly in delivery and logistics.

Given the complexity of our interdependent supply chain, 80% of the <a href="https://www.resilinc.com/blog/download-now-resilinc-2020-annual-report/" target="_blank">failures</a> we saw were in the 2nd and 3rd subtier ecosystem of raw material and component suppliers.

Bearing the brunt

Leaders in healthcare and government, more than any other sector, faced the full force of this disruption. The most visibly impacted area was the medical equipment supply chain, as demand skyrocketed for personal protective equipment (PPE), ventilators, and even hospital beds. But the impact to the public sector went far beyond that, as government leaders sought to keep the economy open and the supply of goods flowing.

As a result, leaders faced 4 core challenges:

Volatile demand: Extreme volatility in critical materials and supplies that public sector leaders needed to address the pandemic, and entirely new demand patterns the world had never seen.

Inventory fluctuations: Stockouts of high-demand goods and stockpiles of low-demand items, with little visibility in inventory count and location.

Logistics constraints: Partial loads, capacity-constrained warehouses, lower fill rates, fewer on-time deliveries, and constrained labor flexibility.

Increased global supply network complexity: The supply chain became even more dependent on tier 2 and 3 suppliers, creating limited visibility into raw or work-in-progress (WIP) inventory, coupled with a rising need to onboard new suppliers and a growing concern around supply chain integrity.

Forging stronger supply chains

Government and healthcare leaders have been focused on supply chain issues for decades. More than 20 years ago, when the September 11 terrorist attacks shook the world and shaped an entire generation, agencies became much more aware of how global risk and uncertainty affect supply chains. Those events moved the issue of supply chain resiliency to the fore.

As the global community focuses on rebuilding and emerging from the most recent crisis, there are 4 key actions that governments must take to modernize and strengthen supply chains. These actions can help ensure increased agility and resiliency for the future and protect against foreign adversaries and other potential risks:

1. Harness data and build visibility across multitier supply chains to smooth volatility.&nbsp;

Organizations gather vast amounts of data to monitor and measure risk. That trove of information can, with improved transparency, provide the ability to identify both relationships and resulting dependencies in integrated chains.

A trusted data exchange secured and enabled by blockchain technology can allow organizations to collect internal and external data from partners across their extended supply chain ecosystem. Once synthetized, that data can offer vital insights shared across partner networks on critical transactions, external and internal events, and shared risks.

2. Monitor the supply chain and drive collaboration to actively plan for future disruption. 

No supply chain is without risk. But increased access to information in a timely manner provides greater decision-making options.

Before an agency can craft a strategy, it must identify the risks inherent in its integrated supply chain. From suppliers and production flows to transactions and operations, organizations must examine the details of each interconnected relationship and segment of the supply chain to pinpoint vulnerabilities and bottlenecks. By creating a common operating picture based on information from all suppliers, organizations can model and test different scenarios to evaluate the plans of action that best align with shared goals.

Increased visibility into supply chain disruptions enables organizations to be better prepared. Moreover, this information can provide organizations insights to help achieve essential supply chain objectives (such as sustainability or supplier diversity) by surfacing information on where and by whom commodities are sourced.

3. Build integrity and trust by measuring performance and risk, and compare results over time.

Measuring the supply chain is as critical as monitoring it. Organizations must identify measurements to gauge and quantify risks, and to better understand the impact and potential exposure of disruptions across their integrated supply chain. Data management solutions can help categorize certain aspects of supply chain risks as high, medium, or low. Transparency across ecosystem partners provides shared insights on the reliability of the entire integrated supply chain.

Extending a measurement system to external partners allows organizations to benchmark themselves against leading organizations in both the public and private sectors&mdash;and drive continuous improvement efforts. Regardless of the data collection frequency, a regular measurement and analysis cadence helps ensure quality findings. This data set is pivotal to shaping a risk management strategy and prioritizing resources for the greatest return.

Combining these findings with the right analytics tools can further enhance the reliability, quality, and repeatability of organizational processes.

4. Improve the resiliency and reliability of supply chains.

With a foundation of data-driven insights for monitoring and measuring the integrated supply chain, organizations can put preventive and proactive strategies in place and continuously iterate to <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/supply-chain-resilience" target="_blank">improve reliability and resilience</a>. With a robust data set, organizations can better monitor their integrated supply chain as they implement new strategies and evaluate the results of new initiatives and interventions.

Introducing new technologies such as artificial intelligence (AI) can further amplify results. AI can help identify suppliers that have room for improvement, prioritizing based on highest impact and predicting new scenarios through simulations.

Improving resiliency also requires building a diverse supplier base. Understanding and mitigating supply chain risks involves gaining visibility into tier 2 and 3 suppliers which&mdash;as we&rsquo;ve seen&mdash;can quickly and significantly disrupt production and delivery. Over <a href="https://www.dnb.com/content/dam/english/economic-and-industry-insight/DNB_Business_Impact_of_the_Coronavirus_US.pdf" target="_blank">90%</a> of Fortune 1000 companies depended on tier 2 suppliers in regions most affected in the initial phase of the global COVID-19 pandemic or operated in potentially adversarial nation states. Impediments to interaction and engagement with these suppliers greatly complicate risk management.

Governments should pursue policies and strategies that reduce dependence on single sources of supply (suppliers and regions) for critical goods and services, and limit geopolitical exposure. Supply chain repatriation should be part of the discussion.

Critical capabilities

Building a deep and comprehensive understanding of your organization&rsquo;s integrated supply chain strengths and weaknesses can enable business continuity planning and rapid response strategies. The last 19 months have been a harsh reminder of the risks inherent in our interconnected world and further demonstrated the criticality of supply chains to economies, organizations, and individuals. As such, it&rsquo;s imperative that governments can crowdsource feedback from stakeholders across the extended value chain&mdash;from suppliers to citizens&mdash;on what they need and what changes impact them most.

We are committed to helping governments build these critical capabilities. We encourage you to contact us directly to learn more and discuss how we can work together to help further protect and promote the safety, security, and economic prosperity of regions and countries.

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COVID-19 Phase III — The new urgency in modernizing supply chains for control, integrity, and dynamic agility

The world&rsquo;s problems are complex.

Extreme weather events. Food insecurity. A global health crisis. These intricate, interconnected challenges require intelligent solutions&mdash;tools, systems, and approaches that have been developed with discipline and rigor.

In its search for answers, the world is turning to science. A recent IBM Institute for Business Value survey found that nearly 9 in 10 (88% of) global consumers believe advances in science and technology are critical to making the world a better place.

The survey of more than 14,500 adults in 9 countries found that consumers are overwhelmingly confident that technology can help address many of the problems facing society today. And 79% of those surveyed say the rapid development of the COVID-19 vaccines increased this confidence. People are most optimistic about the potential impact of AI, robotics, and semiconductor technology.

<img alt="86% of consumers believe AI will help solve the most pressing challenges facing the human race and societies today." src="https://s3.us-south.cloud-object-storage.appdomain.cloud/ibv/I_x55_WXNBVY_3_ITOF_0_G5_z3vy_4d408edb80" style="height:451px; width:800px" />

The US leads the way

While addressing complex challenges like climate change and COVID-19 will require international collaboration, global consumers say the United States is best positioned to tackle the world&rsquo;s toughest problems. 58% believe the US is leading the world in science and technology innovation today and 45% believe the US is most prepared to address the pressing challenges currently facing society. In both cases, global consumers ranked the US higher than all other countries.

To improve the United States&rsquo; ability to leverage advances in science and technology to manage crisis and change, adults in the US believe it&rsquo;s important for their country to:

<ul>
	<li>Encourage public/private partnerships (89%)</li>
	<li>Promote policy and regulation that encourages innovation (91%)</li>
	<li>Improve collaboration and information-sharing across the scientific community, showing they are ready for research institutions to collaborate on innovation (93%)</li>
</ul>

Most global consumers believe governments bear the greatest responsibility for advancing science and technology in their country today. What&rsquo;s more, they expect governments to continue to carry the torch in the future, and the strongest agreement comes from consumers in Brazil, Spain, and Mexico.

<img alt="9 in 10 US adults surveyed believe it's important to encourage public/private partnerships, or promote policy and regulation that encourages innovation to improve US ability to leverage advances in science and tech." src="https://s3.us-south.cloud-object-storage.appdomain.cloud/ibv/r472_El7_SWD_Pd_KW_4_T5i_Y_Ph_N_x_50f79c5e4f" style="height:451px; width:800px" />

Science and tech skills will enable future career success

For some respondents, the rays of hope that emanate from science and technology also cast shadows of doubt and anxiety. 61% of employees surveyed&nbsp;are concerned that technology will ultimately make their jobs obsolete.

However, 85% are confident they can keep up with future advances, and for many, the pandemic jumpstarted this process. 4 in 5 employees worldwide say the pandemic required them to learn both new ways of working and new technologies. Cloud computing (41%) is the top tech used by employees in their jobs today, followed by 5G (37%), IoT (32%), and AI (28%).

Overall, employees are demanding skill development&mdash;and they&rsquo;re ready to make sacrifices to prepare themselves for the future. 59% say they would be willing to take a pay cut to work for an employer that provides training on new technologies. 72% would be willing to switch employers to get this type of training.

<blockquote>
Nearly all employees say they&rsquo;re willing to invest personal income (95%) and personal time (97%) to develop new skills.
</blockquote>

To deliver on these evolving expectations, business leaders need to invest in helping employees gain new skills. But while 74% of executives believe they have been helping their employees learn the skills needed to work in a new way, only 38% of employees agree, according to 2020 research from the <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/hr-3" target="_blank">IBM Institute for Business Value</a>.

<img alt="59% of consumers surveyed report they would be willing to take a pay cut to work for an employer that provides training on new technologies." src="https://s3.us-south.cloud-object-storage.appdomain.cloud/ibv/6_Qgm6_O_Hzu_Knc_T_Tg03n_O8aoq_A_69b198a358" style="height:451px; width:800px" />

Taking a science-forward approach

Advancements in science and technology have already done so much to help humanity understand and address incredibly complex challenges. And what scientists learn today will help the world overcome the obstacles it will face tomorrow.

As renowned astrophysicist Carl Sagan noted decades ago, science is a candle in the darkness. It reveals surprising truths and highlights opportunities for transformational change. In this vein, business leaders who take a <a href="https://www.ibm.com/policy/science-forward/" target="_blank">science-forward approach</a> to adopting new technologies, including AI, hybrid cloud, and quantum computing, will be better positioned to adapt to ongoing disruption and change.

Exponential technologies&mdash;and the new business models they enable&mdash;promise to build resilience and enable growth even as new challenges arise. As entire industries are threatened with extinction, companies that evolve will be better positioned to find new ways to thrive, no matter what the future might hold.

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Global consumers say science and technology are helping solve today’s toughest problems

In the heat of the moment, governments around the world responded to the COVID-19 crisis with rapid innovation &ndash; by creating more frictionless citizen experiences, accelerating digital business transformation, expanding cloud footprints, transitioning to hybrid or remote work models, and integrating global supply chains. In many cases, government leaders surprised themselves with their ability to rapidly innovate. In the rush to launch new capabilities to meet increased demand, however, critical security and protection measures may have been deprioritized, overlooked, or ignored altogether. As a result, many government organizations have further increased their exposure to security threats. The trick now is to sustain the pace of innovation and build even more momentum, while simultaneously closing any security gaps.

Moving government services, communication, and personal interactions to digital has significantly increased potential attack surfaces, resulting in a <a href="https://www.ibm.com/security/data-breach/threat-intelligence" target="_blank">dramatic surge in cybersecurity incidents</a>, including the recent series of ransomware attacks and exposure of personal and sensitive citizen data. This risk has intensified even more as a result of organizations leveraging data and artificial intelligence (AI) to accelerate COVID-19 recovery plans across multiple levels of government. This required moving workloads to the cloud&mdash;along with their associated threats and vulnerabilities. In fact, research indicates <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/zero-trust-security" target="_blank">upwards of 90% of cyber-related incidents originated in cloud environments in 2020</a>.

In addition to increasing risk, cyber incidents also had significant financial impacts on governments. According to <a href="https://www.ibm.com/security/data-breach?utm_medium=OSocial&amp;utm_source=Blog&amp;utm_content=000000NJ&amp;utm_term=10013747&amp;utm_id=SI-Blog-Inline" target="_blank">IBM&rsquo;s Cost of Data Breach Report</a>, public sector organizations are the 6th most frequency attacked among all industries, and the average cost per cyber security incident is nearly $2 million. And what&rsquo;s even more alarming is that attacks on public sector organizations have the 2nd longest attack lifecycle, with the average organization taking 330 days to contain a breach once identified. While you can&rsquo;t point to a singular cause, a dearth of security experts with the right skills is a key gap and a likely contributing factor to the security woes of many public sector organizations.

Securing critical infrastructure with zero trust principles

The very nature of critical infrastructure implies a dynamic relationship between trust and risk. Understanding the amount of risk governments carry and being able to <a href="https://www.ibm.com/security/services/security-governance/risk-management" target="_blank">quantify that risk</a> into financial terms provides a clear picture for implementing security in the most efficient and effective way possible. This is even more important when government operations move online, exposing both IT and operational technology (OT) networks to potential compromise. The May 2021 <a href="https://www.bloomberg.com/news/articles/2021-06-04/hackers-breached-colonial-pipeline-using-compromised-password" target="_blank">Colonial Pipeline ransomware attack</a> led to fuel shortages across the East Coast of the United States. Reliance on IT and OT environments means mission-critical infrastructure is increasingly vulnerable to new threats. For example, GPS-enabled navigation systems that we take for granted are at risk of breakdown, which can negatively impact the deployment of emergency services vehicles, maritime navigation, and operation safety of many services consumed by citizens every day.

With the number of risks and security events growing exponentially, government security operation teams are adopting the zero trust security approach. The <a href="https://www.ibm.com/thought-leadership/institute-business-value/report/zero-trust-security" target="_blank">IBM Institute of Business Value</a> concluded that organizations with mature zero trust capabilities have reduced their security capital and operational expenditures and increased the effectiveness of their cybersecurity operations. This zero trust approach enables the protection of the IT and OT at the foundation of government services by adopting key zero trust principles:

<ul>
	<li>Preserve citizen private and sensitive data with a focus on simplifying and securing user onboarding, managing user preferences and consents, and enforcing privacy regulations controls.</li>
	<li>Reduce the risk of insider threat by enforcing least privilege access, discovering risky user behavior, and embedding threat intelligence.</li>
	<li>Protect the hybrid cloud by managing and controlling all accesses, monitoring cloud activity/configurations, and securing cloud native workload.</li>
	<li>Secure the remote workforce by securing bring your own (BYO) and unmanaged devices, eliminating VPNs, and providing &ldquo;passwordless&rdquo; experiences.</li>
</ul>

Cognitive roadmap to zero trust

Government organizations can&rsquo;t simply spend or hire their way to a healthy security posture. To close critical capability and skills gaps, several approaches and technologies are needed. As security technologies have evolved over the years, they have moved from simple perimeter controls (such as focusing on static defenses) to more advanced security intelligence capabilities (such as focusing on real-time threat information and deviations from patterns).

These new technologies have ushered us into the cognitive era of security. Cognitive security solutions can understand context, behavior, and meaning by analyzing both structured and unstructured data. Cognitive security looks to unlock a new partnership between security analysts and their technology. These solutions can interpret and organize information and offer explanations of what it means, while offering a rationale for conclusions. They also learn continuously as data accumulates and insights are derived from interaction.

These next-gen cognitive security solutions, can enable government security teams to:

<ul>
	<li>Enhance the capabilities of junior security operations center (SOC) analysts by giving them access to best practices and insight that used to require years of experience.</li>
	<li>Improve the response speed by applying external intelligence from blogs and other sources in an effort to take action before threats materialize.</li>
	<li>Quickly identify threats and speed detection of risky user behavior, data exfiltration, and malware infections using advanced analysis methods.</li>
	<li>Gain greater context around security incidents through automation of local and external data gathering and reasoning.</li>
</ul>

Cognitive security solutions can be used in combination with automated, data-driven security technologies, techniques, and processes to help ensure the highest levels of context and accuracy.

Improving collaboration for better security

While traditional approaches to cybersecurity relied on permissions and discrete network boundaries, today&rsquo;s networks are defined by dynamic services and diffuse boundaries. Today&rsquo;s digital platforms generate value by virtue of being interconnected, by sharing information across multiple parties. One leading example is the <a href="https://mediacenter.ibm.com/media/Los+Angeles+Cyber+Lab+/1_hee4ejbp/98865812" target="_blank">LA Cyber Lab</a>, a first of its kind threat intelligence sharing platform, which allows city government officials, businesses, and private citizens to share cyber threat intelligence. In support, IBM deployed the <a href="https://www.ibm.com/security/xforce/research-hub" target="_blank">X-Force Threat Intelligence Research Hub</a>, which is using cognitive services and tools to correlate many parallel cyber events.

This collaborative approach to security helps governments increase their responsiveness while reducing complexity. Cognitive security technology helps to identify primary cyber weaknesses and vulnerabilities across government operations and government-controlled supply chains. Success requires a holistic approach and a deep understanding of the value that cognitive security solutions can provide.

We encourage you to contact us (<a href="https://www.linkedin.com/in/holecy/" target="_blank">Miro Holecy</a>, <a href="https://uk.linkedin.com/in/julianmeyrick" target="_blank">Julian Meyrick</a>, <a href="https://www.linkedin.com/in/tim-paydos-857197" target="_blank">Tim Paydos</a> and <a href="https://uk.linkedin.com/in/mikestone1" target="_blank">Mike Stone</a>) directly to learn more. While we can&rsquo;t predict the future any more than we could predict the last months, we can work together to help forge a path forward that is prosperous, productive, and more secure for all of us.

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COVID-19 Phase III— Amplifying the security imperative to emerge stronger and more resilient

Thought Leadership Research Insights Blog