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DIGITAL DELIVERS FINANCIAL REWARD FOR REFINERS, BUT CUTTING-EDGE TECHNOLOGIES COULD UNLOCK EVEN MORE VALUE, ACCORDING TO NEW ACCENTURE RESEARCH

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Data security remains barrier to digital deployment as cyberattacks increase

NEW YORK; June 5, 2018 – Refiners are gaining financial benefits from digital technologies but are missing out on the additional value that the most cutting-edge technologies could provide, according to new Accenture (NYSE: ACN) research.

“The Intelligent Refinery,” Accenture’s second annual study on digital technology in the refining industry, is based on a survey of approximately 170 executives, functional leaders and engineers at refiners globally.  In addition to addressing the financial benefits that digital technologies can provide, the research also suggests that refiners are not investing sufficiently to address the increasing number of cyberattacks resulting from the proliferation of digital technologies.

Forty-one percent of respondents reported that their company can now determine the financial value of using digital technologies, including 30 percent who reported that the technologies increased their refining margins by more than 7 percent in the last 12 months. One-fifth (20 percent) of respondents said digital technologies are adding US$50 million to US$100 million or more in value to their business, with another one-third (33 percent) of respondents citing between US$5 and US$50 million.

This tangible financial benefit may explain why more than half (59 percent) of companies surveyed — approximately the same proportion as in last year’s survey — are spending more or significantly more on digital technologies than they were 12 months ago. Additionally, three-quarters (75 percent) intend to increase spending in the next three to five years, up from just over 60 percent in last year’s survey, indicating that demand for digital technologies remains strong.

Likewise, almost half (48 percent) of refiners now rate the use of digital technologies within their company as mature or semi-mature (up from 44 percent in last year’s survey). At the same time, however, most refineries have yet to move beyond deploying well-established digital technologies, such as analytics.

Indeed, when asked to identify the digital technologies driving the greatest margin improvement in refining operations, respondents most often identified advanced process control and advanced data analytics, cited by 61 percent and 50 percent of respondents, respectively. These are also the technologies to which refiners expect to allocate the largest proportion of their digital budget over the next 12 months. Cutting-edge technologies that could unlock additional value – including internet of things sensors and edge computing, mixed reality, mobility and blockchain/smart contracts – are only seeing partial adoption or pilot programs and are likely to receive less investment than the other well-established technologies over the next year.

In light of this, there is a need for more effective management of refiners’ digital strategies, with one-quarter (24 percent) of executives saying there is currently no clear role within the organization driving the digital strategy. In fact, 43 percent reported that this lack of a clear digital strategy is a barrier preventing further adoption of digital technologies in their refineries.

However, change is afoot. While only 11 percent of respondents said their company currently has a chief digital officer driving the digital agenda, many refiners are making governance changes to drive greater digital transformation and address the convergence of information technology and operational systems. Specifically, one-third (34 percent) are creating new organizational structures, more than one quarter (28 percent) are launching a steering committee, and 15 percent are creating new C-level positions.

“Refiners are currently reaping just a fraction of the value that digital can yield,” said Tracey Countryman, managing director for Global Resources Industry X.0, Accenture. “The next step will be to combine and deploy multiple technologies at scale to totally reinvent business processes and drive plant-wide transformational change. Our recent Accenture Disruptability Index pinpointed the energy industry as the most susceptible to future disruption. Increased and tactical digital investment can better enable the efficiency and performance improvements to help refiners weather the storm. There are signs refiners have realized this and are taking action to capture these benefits.”

Rising number of cyberattacks requires greater investment to bolster cyber defenses 
With a growing number of cyberattacks, there comes the associated need to constantly upgrade cybersecurity resilience and response. Indeed, 28 percent of respondents said they are seeing more or significantly more cyberattacks than last year. Most worryingly, at a time when operations are becoming increasingly connected and exposed to these kinds of threat, one-third (33 percent) of respondents said they don’t know how many attacks they are experiencing.

The need becomes more pressing considering that 38 percent of respondents said they see data security as a barrier to adopting digital technologies in their organization.  Among the risks respondents most often associated with cybersecurity are operational impact (67 percent), impact on workforce health and safety (39 percent) and data breaches (39 percent).

However, only 28 percent of executives cited digital tools to improve cybersecurity in one of their top three priority areas for investment in digital technologies. Respondents were more concerned about how lack of digital investment will affect their competitiveness (cited by over 67 percent), how digital can support cost reduction and improve their margins (64 percent) and how weak digital investment might affect their operational reliability (58 percent).

“With the increased exposure and risk from ever-greater connectivity of digital technologies comes a need to invest to stay at least a step ahead of the growing threat,” said Jim Guinn, a managing director at Accenture who leads the cybersecurity practice within the company’s Resources operating group. “In order to do that investing now in fundamental security capabilities will be crucial to safeguard future operations.”

Research Methodology
The online survey was conducted in March 2018 by PennEnergy Research in partnership with the Oil and Gas Journal. The survey was developed with HSB Solomon Associates LLC, a benchmarking and global advisory services company for the global energy industry. Respondents are subscribers to PennWell publications and comprised 169 refining industry professionals across 48 countries, including executive and mid-level management, business unit heads, engineers and project managers from a cross-segment of the industry.

About Accenture
Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions – underpinned by the world’s largest delivery network – Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With approximately 442,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com.

 

 

 

 

 

Source: Accenture

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Business

BANK OF CHILE HIT BY CYBER-ATTACK, HACKERS ROB MILLIONS

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Shares in the Bank of Chile were down on Monday after it confirmed hackers had syphoned off $10 million (roughly Rs. 67 crores) of its funds, mainly to Hong Kong, though the country’s second-largest commercial bank said no client accounts had been impacted.

The cyberheist is the latest in a string of such attacks, including one in May in Mexico in which thieves used phantom orders and fake accounts to steal hundreds of millions of Mexican pesos out of the country’s banks, including Banorte.

Shares in the Bank of Chile, which is controlled by the Chilean Luksic family and Citigroup, were down 0.47 percent at CLP 100.4 ($.16) in mid-day trading.

Bank CEO Eduardo Ebensperger told Chilean daily La Tercera in an interview on Saturday that hackers had initially used a virus as a distraction, prompting the bank to disconnect 9,000 computers in branches across the country on May 24 to protect customer accounts.

Meanwhile, the hackers quietly used the global SWIFT bank messaging service to initiate a series of fraudulent transactions that were eventually spotted by the bank and cancelled but not before millions were funnelled to accounts abroad.

“The [attack] was meant to hurt the bank, not our customers,” Ebensperger said.

Ebensperger said a forensic analysis conducted by Microsoft had determined the attack was the work of a sophisticated international group of hackers, likely from eastern Europe or Asia, and that the bank had filed a criminal complaint in Hong Kong.

The bank said in a May financial statement that it would work with insurers to recoup the lost funds.

 

 

 

 

source: Gadgets 360

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3 LESSONS FOR ENTREPRENEURS FROM SPOTIFY, WHICH WON OVER TAYLOR SWIFT AND JUST MADE ITS BILLION-DOLLAR IPO

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As the bell rang Tuesday morning at the New York Stock Exchange, music streaming giant Spotify went public in a historic move for the music industry. Company shares opened at $165.90, the cost of about 13 physical CDs, or close to 130 songs on iTunes. The opening price pegged Spotify’s market value Tuesday morning at close to $30 billion.

When CEO Daniel Ek launched Spotify in 2008, his business plan shook up the industry. Music streaming revenue in the U.S. has multiplied more than elevenfold since 2010 — growing from around $500 million to, in 2017, roughly $5.7 billion — and experts say there’s likely no going back. Ek’s business plan hasn’t changed much since its original incarnation — the idea that consumers either listen to ads or pay a regular fee for access to essentially all music. The company’s $1 billion “IPO” isn’t traditional, either.

For the moment, the company’s big move, seen by some in the industry as a gamble, seems to be working out. About 30 million outstanding shares of Spotify’s 178 million total were traded on Tuesday, and the price dropped just around 10 percent. By the end of day, the company’s market value was close to $27 billion, and as of Wednesday, Ek’s shares (about 9 percent of the company) were worth $2.3 billion.

Here are three lessons you can learn from Spotify after its big day.

1. Don’t be afraid to take a nontraditional approach.

Spotify’s “IPO” is actually called a “direct listing.” Instead of a traditional IPO, which involves more middlemen in the form of investment banks and institutional investors, Spotify is choosing to allow existing shareholders to sell their shares to potential buyers immediately. Spotify’s direct listing also allows shareholders to sidestep the traditional 180-day lockup period and see an immediate return.

As for why the company went the nontraditional route? Most companies raise capital and use IPO proceeds to fuel growth, but “Spotify doesn’t need that — it has plenty of cash on its balance sheets,” says Matthew Kennedy, IPO market strategist at Renaissance Capital.

The company’s five reasons for going with a direct listing align largely with its core values. For example, instead of preferred access to bankers, a direct listing grants equal and simultaneous access to the public. It also doesn’t hurt that this plan should save Spotify roughly $35 million in fees, Kennedy says. But although the likes of Airbnb and Uber might sit up and take notice, he warns that a direct listing likely isn’t the best choice for the majority of tech companies. The insurance that a traditional IPO and its underwriters provide can be important for stability — especially if the company isn’t a household name.

 

2. Do something differently — or better — than everyone else.

Almost 377 billion songs were streamed in 2017, up more than 50 percent from the previous year, according to a report by BuzzAngle Music. That number left song sales in the dust. As the world’s largest music streaming service, Spotify is leading competitors including Apple Music and Pandora — and although it wasn’t technically the first of its kind (Napster launched in 1999), the company aimed to revolutionize music streaming with easier access for consumers and a new idea for turning a profit.

That kind of “different or better” approach is a good way to frame your own business idea, and one key is often finding your niche and solving a chief problem. For example, Netflix’s original incarnation — allowing consumers to rent and return movies via snail mail — capitalized on a problem in the industry and offered a solution.

“Spotify’s done that as well,” says David Brickley, host of Entrepreneur Wrap and CEO/owner of STN Digital. Sit down and think about the problems in an industry you know well, then brainstorm solutions. “You have enough coffees with people, [and] you start to hear the same problem over and over again in the industry,” Brickley says.

Once you’ve got a business plan, practice your elevator pitch that clearly details why your idea is different and which problem you’re solving.

Related: IPO vs. Getting Acquired: What You Can Learn From Snap and Instagram’s Divergent Exit Strategies

3. Turn adversaries into allies.

Singer Taylor Swift made headlines in 2014 when she pulled her entire music library from Spotify over a revenue conflict. Since then, she’s reinstated her songs on the streaming service — and last week, she announced that the music video release for her song “Delicate” would only be available on Spotify. Turning a business opponent into a partner isn’t very common, but Spotify officials and Swift came to a level of understanding. So how do you do it — and why?

“It’s being a good human … even if somebody is a competitor and not necessarily on your side,” Brickley says.

Most industries are much smaller than you’d think, so treating everyone — even your opponents — with respect is a good rule to live by, especially since you might end up working together one day. If you’re butting heads with another key industry figure, keep in mind that the best way to sow goodwill is asking for their expertise. And if you need to have a tough conversation? Do it in person.

“You can disarm them better psychologically, if you will,” Brickley says. “90 percent of communication is nonverbal.”

 

 

Source: https://www.entrepreneur.com/article/311511 

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HOW SHOULD I PREPARE FINANCIALLY TO LAUNCH MY OWN BUSINESS?

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I’m considering starting up a personal business. How should I prepare financially? —Anonymous

Being your own boss is the dream for many Americans.

But it’s not as simple as quitting your job and then pow! Instant entrepreneurial success. Instead, it takes time. And, of course, it takes money.

Don’t quit your day job just yet

If you’re unsure about jumping into the world of self-employment, try some baby steps first. Pick up a side gig, turn your passion into a mini business or cultivate your side hustle into something bigger. And most importantly, set some money aside. You’ll need something to live on while you’re business is still getting off the ground and isn’t making money yet.

Kristin Sutton, a financial planner and founder of her own business, Debt Free Black Girl, admits that when she first embarked on a life of entrepreneurship, she was a little too excited to hit the ground running.

“I quit my job prematurely and it’s been a struggle,” she says. “Your job is your first investment into your business. Utilize that money to fund your start-up costs. It’ll keep you afloat while you’re starting to make money consistently.”

Kimmie Greene, a self-employment expert and head of communications at Intuit Quickbooks, says she frequently hears from young people who are excited to leap directly from college life to starting their own business. Her advice: slow down. Experiences working for someone else can actually make you a more successful entrepreneur.

“It’s really important to have a year to a few years working for someone else, because you establish a network and you learn your work style and you learn what it is to potentially manage someone else’s money before you manage yourself,” she says.

Know your numbers

Knowing the health of your business account means also knowing the health of your personal account.

Sutton suggests keeping your personal money and your business money completely separate — and start that habit on Day 1. When you open a new bank account for your business, it ensures you save money for supplies, investments and eventually taxes, all without dipping into your personal funds.

Her own tip: meet with an accountant.

“I suggest people do hire an accountant if they aren’t good at managing their own money,” she says. “In order to be successful with the business, you have to know your personal finances as well.”

Pick your investments carefully

The best part of starting your own business is earning your own money.

The hard part: deciding what to do with it.

At your past 9-to-5 jobs, taxes, retirement savings and other expenditures come out of your paycheck automatically. You lifted pens from the office supply closet and poured java from the office coffee maker.

But as a self-employed mogul, none of that comes free. In your initial business plan, calculate what money you will have to set aside for taxes, insurance, retirement savings, rent, material costs and other business expenses.

With the money left over, however, you have to consider what you’ll keep as income — and what you’ll invest back into the business.

Greene recommends considering what matters most to you at different stages of growing your business.

At the very beginning, for example, a new computer may be more valuable than a membership to a coworking space. But as you expand, you may find that a coworking space or conference ticket offers invaluable opportunity to promote your product, meet mentors, connect to the larger industry community and more.

 

 

 

Source: http://money.cnn.com/2018/03/08/pf/money-movesentrepreneurship/index.html

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