Future Focus: London June 4 2009

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Future Focus London June 4th 2009

2009 IBM Corporation

Future Focus Charles Bligh

2009 IBM Corporation

Future Focus Dr James Bellini

2009 IBM Corporation

Future Focus London

Twitter replyto:@futurefocus Or mention #futurefocus www.futurefocusblog.com 2009 IBM Corporation

Future Focus Richard Farleigh

2009 IBM Corporation

Ned Kelly

Interest Rates

Taming The Lion “A tour de force of common sense investing.” Tom Stevenson Daily Telegraph

Sir Alexander Fleming The Nobel Prize in Physiology or Medicine 1945

Igloo Thermo-Logistics

Future Focus

2009 IBM Corporation

Future Realities Focus

2009 IBM Corporation

Future Focus Future Economic Realities Stephen Radley June 4th 2009 2009 IBM Corporation

Overview World economy has started to thaw... ...but recovery likely to be halting Business environment will be more challenging... ... but create significant opportunities... ... with company fortunes becoming increasingly polarised

59 / x

2009 IBM Corporation

World economy has been in deep freeze… % change in GDP quarter on quarter 0.0 -0.4 -0.8 -1.2 -1.6 -2.0 -2.4 -2.8 -3.2 -3.6 -4.0

2008q3

%

Japan

UK

2008q4

2009q1

Italy Germany EurozoneFrance Spain

US 60 / x

2009 IBM Corporation

… but is starting to thaw Manufacturing purchasing managers index 50= no growth US

UK

Eurozone

60 55 50 45 40 35

61 / x

9 Ap r-0

9 -0 Ja n

O

ct -0

8

8 Ju l-0

r-0 8 Ap

-0 8 Ja n

7 -0 O ct

l-0 7 Ju

7 r-0 Ap

-0 7 Ja n

6 O ct -0

Ju l-0 6

6 r-0 Ap

Ja n

-0

6

30

2009 IBM Corporation

Recovery driven by End to stock reduction cycle Boost to disposable incomes from falling costs Low interest rates Massive fiscal intervention Signs that support for bank lending is starting to work

62 / x

2009 IBM Corporation

But thawing out will leave a major mopping up exercise Recessions associated with credit crises tend to be more severe with longer lasting effects Large overhang of bank debt Households need to rebuild balance sheets Action needed to address ballooning public sector deficits World trade system will take time to get functioning normally Inflation likely to remain low for some time

63 / x

2009 IBM Corporation

Rebuilding Balance Sheets Likely to be Long Process UK Personal Savings ratio

14 12 10 8 6 4 2

64 / x

3

20 0

7

1

20 0

6

3 4 20 0

1

20 0

3

3

20 0

1

1

20 0

0

3

19 9

8

1 19

97

3 5

19 9

19

94

1

3

19

92

1

19 9

1

3

19

89

1 19

88

3 86

19

19

85

-2

1

0

2009 IBM Corporation

Key questions Can world economy return to past trend growth rates? Where will growth in the world economy come from? What will be the major growth markets? How serious are the dangers to business from increased protectionism, growing regulation and deglobalisation of finance? What will business need to do to thrive in this changed environment?

65 / x

2009 IBM Corporation

Trend growth rates Cutbacks in investment could weaken innovation and productivity growth But recession creates opportunity and imperative to change practices Working populations shrinking... ... but hit to wealth creates incentives to work longer Increased government role in economy creates danger of misallocation of resources Regulation likely to stifle financial innovation Constraints on public infrastructure spending

66 / x

2009 IBM Corporation

Where will growth come from? United States - Company balance sheets in good shape pre-recession - With vigorous cost cutting since then - Major problems remain in banking system but some signs of confidence returning - Significant fiscal boost in short-term - With shift to bigger government likely to be lasting - Major advatages from flexible economy and close trading links with Asian economies

67 / x

2009 IBM Corporation

Where will growth come from? Asia - Increasingly confident and trading amongst itself - Wide differences in performance both in short and long-term - Lessons from late 80s mean financial system in good shape - Shift towards domestic consumption supported by widening of welfare systems - Partially conmpensating for weaker contributon from trade - Many nations still in catch-up phase with significant infrastructure programmes in train - Major environmental challenges

68 / x

2009 IBM Corporation

Where will growth come from? Europe - Concerns over transparency of banks and ability to develop Europe-wide solutions - Consumers and companies particularly dependent on bank lending - Working populations shrinking - Business still more regulated than in other parts of the world but growing evidence of companies working round this - Widely varied performance across Central and Eastern Europe but some nations face similar issues to late 80s Asian Tigers

69 / x

2009 IBM Corporation

What will be the major growth markets Climate and environment - Low carbon energy, products and promoters of energy efficiency - Growing importance of energy efficiency - Significant winners and losers - Opportunities in emerging economies but global agreement uncertain - Resource efficiency a growing area - Demographic change - Strategic security

70 / x

2009 IBM Corporation

What are the dangers to business? Regulation - Some shift in sentiment away from free market approach - Increased pressure for regulation - Potential for voluntary approach in next Parliament Global trade and finance flows - Public statements positive but signs of creeping protectionism - Potential significant impact on supply chains - Recent major shift away from global finance - But longer term finance will be drawn to highest returns though return to ``normal`` may be slow

71 / x

2009 IBM Corporation

What does business need to do to thrive? Systematic focus on innovation to differentiate from competition and combine high quality with low cost Corporate reputation and behaviour increasing critical to attracting and retaining key staff and customers Ambitious and coherent approach to exploiting opportunities in emerging markets Agility in identifying and capitalising on new opportunities

72 / x

2009 IBM Corporation

Key messages Worse could well be over But major problems to address and high degree of uncertainty Growth likely to be slower But business can have major influence on business environment and outlook Significant opportunities for companies who are alert and fast moving

73 / x

2009 IBM Corporation

Future Realities Focus

2009 IBM Corporation

Future Focus In the Future We’ll All Be Older Professor David James

2009 IBM Corporation

Firms get out of shape in the good times Recessions force us to get back into shape Treat everyday as if you were in a recession

76 / x

2009 IBM Corporation

What‘s Your Core Competence? 77 / x

2009 IBM Corporation

3.0bn 78 / x

2009 IBM Corporation

we‘re addressing a new

Breed of customers

79 / x

2009 IBM Corporation

All businesses are liars....

80 / x

2009 IBM Corporation

the media revolution we are talking to a new

Breed of customer...

81 / x

2009 IBM Corporation

we are talking about

DIY MEDIA

82 / x

2009 IBM Corporation

garage influentials

curators of style

Generation C(ontent)

Micro-Celebrities 83 / x

2009 IBM Corporation

Who are the world’s most trusted brands

? 84 / x

2009 IBM Corporation

you &

me

85 / x

2009 IBM Corporation

Thank-You [email protected] 07710 754017 86 / x

2009 IBM Corporation

Future Focus

2009 IBM Corporation

Future Communications Focus

2009 IBM Corporation

Future Focus Euan Semple

2009 IBM Corporation

Future Communications Focus

2009 IBM Corporation

Future Focus

William Robins Director, Keystone Law Technology and the future of legal services

2009 IBM Corporation

Welcome 

Introduction to Keystone law



Keystone’s business model



Our satellite offices



Legal experts



Central office

Overview 

Lessons learnt



Future of legal services industry



Market conditions

Trends in the legal services market 2000 to 2007 

Salaries up



Profits per partner up



Legal spend up



Proportion of junior lawyers up



Head count up



Average spend up



Smaller clients dropped

The legal services market today – staff 

Linklaters – 270 redundancies



Allen and Overy – 250 redundancies



Baker McKenzie – 125 redundancies



DLA – 124 redundancies



Collectively 4,000 redundancies



Trainees not taken on

The legal services market today – renumeration 

Cuts across the board for associates



Eversheds profits per partner – down 27%



Latham and Watkin profits per partner – down 21%



Cameron McKenna profits per partner – down 15%



Most law firms still to report

How is Keystone doing? 

Turnover up 80%



25 new lawyers



Fastest growing law firm in the country

Trends in the legal market 2000 to 2007 

Salaries up



Profits per partner up



Legal spend up



Proportion of junior lawyers up



Head count up



Average spend up



Smaller clients dropped

Effects of these market trends 

SMEs priced out of the market



Legal bills disproportionately high



Work pushed down to juniors in the bid to increase profitability

Keystone‘s response to these market trends 

Keystone was set up to offer: • Cost effective legal advice • A joined up approach • Personal lawyer/client relationships

Cost effective legal advice Break down of typical fixed costs 

Staffing: • • • • • • •

Senior lawyers Junior lawyers Knowledge development lawyers Secretaries Human resources IT support Back office



Non-staffing: • Rent and office equipment • Information technology • Consumables

Cost effective legal advice An assessment of the value of fixed costs to clients Break down of costs 

Staffing: • • • • • • •

Senior lawyers – highly valuable Junior lawyers – valuable in part KDLs – no direct value Secretaries – valuable in part Human resources – no value IT support – no direct value Back office – no direct value



Non-staffing: • Rent and office equipment – some value and in part required • Information technology – key area • Consumables - required

Cost effective legal advice – Keystone‘s approach Break down of costs 

Staffing: • Senior lawyers – a priority • Junior lawyers – replace with technology • KDL’s – outsource • Secretaries – replace with technology • Human resources – not needed • IT support – outsource • Back office – streamline



Non-staffing: • Rent and office equipment – dispersed and flexible solution • Information technology – targeted spend • Consumables - streamline

The results of being cost effective 

Cost savings passed on to clients



Able to undercut the competition by 40 to 70%



Fixed fees to align our business with our clients

What technology does Keystone use? 

The mobile office



Online and offline functionality



Some examples: • • • • • •

Web access Maximiser Gotomeeting VOIP Desk to desk video conferencing Instant messenger

Keystone‘s key lessons  Using technology: • • • • •

Don’t throw money at the problem Buy technologies based on problems and opportunities Buy what you need most, first Have an IT strategy Get real use out of any technology you buy

Future Communications Focus

2009 IBM Corporation

Future Focus The Future of Work @IBM Brendan Tutt

2009 IBM Corporation

IBM’s transformation: An ongoing journey

1984

1992

2004

2005

2006

109 / x

2009 IBM Corporation

Knowledge Creation in the “old world” Subject Matter Experts

Create Content for others to use

110 / x

2009 IBM Corporation

Access to “Experts” in the “Old World”

111 / x

2009 IBM Corporation

Changing Nature of Work Drives a Need to Connect Dispersed Workforces

112 / x

2009 IBM Corporation

Something Changed .............

113 / x

2009 IBM Corporation

“Experts” are everywhere

Knowledge

114 / x

2009 IBM Corporation

And they are networked Instant Messaging File Sharing Social Bookmarking Activities Wiki's Blogs

115 / x

2009 IBM Corporation

....the world of work is changing From Hierarchies and Teams … Exploration & Production

to Networked Communities O’Brien

Senior Vice President

Stock

Jones

Explorations

Drilling

Production

Williams

Taylor

Stock Shapiro

G&G

Petrophysical

Production

Reservoir

Cohen

Cross

Sen

O’Brien

Shapiro

Smith

Andrews

Moore

Paine

Hughes

Cohen

Paine

Cole

Miller

Kelly

Ramirez

Jones

Andrews

Smith Miller

Hughes Bell

Extended Community who leverage Cole’s knowledge to do their jobs

Williams

Cross Hussain

Cole

Taylor Hussain

Moore Kelly

Ramirez

Bell

Sen

Social Network Analysis

116 / x

2009 IBM Corporation

IBM’s internal innovations Profiles

Persona

Bluepages

BlueGroups

Communities

Connections Profiles

Beehive

Community tools

Connections Communities

Community Map

Connections Blogs

BlogCentral

Blogs

Connections Files

Cattail

Files

Connections Dogear

Dogear

Dogear Instant Collaboration

Activities

1998

Activity Explorer

UAM

2003

Connections Activities

OpenActivities

2009 117 / x

2009 IBM Corporation

IBM Lotus® Connections social software Lotus Connections is social software for business that empowers you to be more innovative and helps you execute more quickly by using dynamic networks of coworkers, partners and customers.

Home page

Profiles

Blogs

Files

Communities

Activities

Wikis

118 / x

Dogear

2009 IBM Corporation

Future Communications Focus

2009 IBM Corporation

Future Focus

2009 IBM Corporation

Future Focus

2009 IBM Corporation

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