The

Quantum
Decade
A playbook for achieving awareness,
readiness, and advantage

Fourth edition
How IBM can help
Partnerships in quantum computing between technology providers and visionary organizations are
expanding. Their aim is nothing short of developing quantum computing use cases and corresponding
applications that solve previously intractable real-world problems. The IBM Quantum Network is a
global ecosystem of over 210 Fortune 500 companies, leading academic institutions, start-ups, and
national research labs, enabled by IBM’s quantum computers, scientists, engineers, and consultants.
Participants collaborate to accelerate advancements in quantum computing that can produce early
commercial applications. Organizations that join the IBM Quantum Network can experiment with how
their high-value problems map to a real quantum computer. They can access 100+ qubit IBM Quantum
processors to explore practical problems important to industries. Visit [Link] for
more information.

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The
Quantum
Decade

A playbook for achieving awareness,

readiness, and advantage

Fourth edition
 The Quantum Decade

Contents

1 Foreword

3 Introduction

13 Chapter One: Quantum awareness and the age of discovery

35 Chapter Two: Quantum readiness and the power of experimentation

59 Chapter Three: Quantum Advantage and the quest for business value

91 Industry guides:
93 Airlines
99 Banking and financial markets
105 Chemicals and petroleum
111 Electronics
117 Government
123 Healthcare
129 Insurance
135 Life sciences
141 Logistics

i
 IBM faces of
The Quantum Decade

Thank you to the IBM team who participated Anthony Annunziata Gaylen Bennett
in and facilitated interviews and case studies Director of Industry & Technical
Accelerated Discovery Services Offerings
in these capacities.
IBM Quantum IBM Quantum

Joseph Broz David Bryant Cristina Caballe Joel Chudow Charles Chung
Vice President Chief Experience Officer Senior Partner Strategic and Industry Electronics Industry
Growth and Markets IBM Quantum Vice President Partnerships Global Lead Consultant
IBM Quantum IBM Global Public Sector IBM Quantum IBM Quantum

Christopher Codella Dan Colangelo Antonio Córcoles Scott Crowder Kristal Diaz-Rojas
Future of Computing Service Parts Planning Research Staff Member Vice President Chief of Staff to
Distinguished Engineer Program Manager IBM Quantum Adoption and Jamie Thomas,
IBM Quantum IBM Systems Business Development General Manager
IBM Quantum IBM Systems

Stefan Elrington Jay Gambetta Jeannette Garcia Darío Gil Jonas Gillberg
Global Lead for Start-ups IBM Fellow and Vice President Senior Research Manager Senior Vice President Chemicals and Petroleum
IBM Quantum Quantum Computing Quantum Applications and Director Industry Consultant
IBM Quantum and Software IBM Research IBM Quantum
IBM Quantum

ii
Raja Hebbar Heather Higgins Michael Hsieh Noel Ibrahim Blake Johnson Gavin Jones
Partner & Global Industry & Technical Government Squad Leader Financial Services Quantum Platform Lead Manager, Quantum Applications
Quantum Delivery Leader Services Partner IBM Quantum Industry Consultant IBM Quantum Technical Quantum Ambassador
for Enterprise IBM Quantum IBM Quantum IBM Quantum
IBM Quantum

Mariana LaDue Jesus Mantas Tushar Mittal Paul Nation Zaira Nazario Imed Othmani
Travel and Transportation Global Managing Partner Senior Product Manager Principal Research Theory, Algorithms, and Industry Consulting Partner
Industry Consultant IBM Consulting IBM Quantum Scientist Applications Technical Lead IBM Quantum
IBM Quantum IBM Quantum IBM Quantum

Hanhee Paik Bob Parney Jean-Stéphane Veena Pureswaran Edward Pyzer-Knapp Vlad Rastunkov
Research Staff Member Industrial Process Payraudeau Research Director Senior Technical Quantum Principal
IBM Quantum Squad Leader Managing Partner — Offering Quantum Computing Staff Member and Computational Scientist
IBM Quantum Management, Assets, IBM Institute for Worldwide Research Lead IBM Quantum
IBM Institute for Business Business Value AI-Enriched Modeling
Value, and Industry Centers and Simulation
of Competence IBM Research
IBM Consulting

Travis Scholten James Sexton Claudine Simson Jamie Thomas Peter Tysowski Kenneth Wood
Quantum Computing IBM Fellow and Director Director, Core AI, General Manager Insurance Industry Global Business
Applications Researcher Data Centric Systems Exploratory Science, Systems Strategy Consultant Development Director
IBM Quantum IBM Research Major Strategic Accounts, and Development IBM Quantum IBM Quantum
Global Executive Oil and IBM Systems
Gas/Energy/Chemicals
IBM Corporate Headquarters

iii
 The Quantum
Decade
Perspectives from
across the field

Ching-Ray Chang Richard Debney Todd Hughes Ilyas Khan

Thank you to these quantum computing Distinguished Professor Vice President Technical Director Founder and CEO
authorities who shared their expertise Department of Physics Digital Technology Strategic Projects and Initiatives Cambridge Quantum
with us in these capacities. National Taiwan University BP CACI Computing

Glenn Kurowski Doug Kushnerick Sabrina Maniscalco Ajit Manocha

Senior Vice President and formerly with Technology Professor of Quantum Information President and CEO
Chief Technology Officer Scouting and Ventures and Logic, University of Helsinki SEMI
CACI ExxonMobil Research CEO, Algorithmiq Oy
and Engineering

Prineha Narang Jeff Nichols Victoria Ossadnik Christopher Savoie

Assistant Professor of Associate Laboratory Director Chief Operating Officer Founder and CEO
Computational Materials Science Oak Ridge National Laboratory Digital and Innovation Zapata Computing
Harvard University [Link]

Irfan Siddiqi Colonel (Retired) Stoney Trent Peter Tsahalis Christian Weedbrook
Professor of Physics Founder and President CIO of Strategic Services and CEO
University of California The Bulls Run Group Advanced Technology Xanadu Quantum Technologies
Berkeley Wells Fargo

iv
 A snapshot
A snapshot of of
IBM technical
IBM technical
experts
experts who who
are advancing
are advancing
quantum
quantum computing
computing

Sergey Bravyi Markus Brink Jerry Chow Antonio Córcoles Andrew Cross
IBM Fellow and Chief Scientist Manager, Quantum IBM Fellow and Director of Research Staff Member Research Staff Member and Manager
for Quantum Theory Processor Development Quantum Infrastructure IBM Quantum Theory of Quantum Computing
IBM Quantum IBM Quantum IBM Quantum IBM Quantum

Oliver Dial
IBM Fellow and
Chief Quantum
Hardware Architect
IBM Quantum
Andrew Eddins
Research Physicist
IBM Quantum faces
Ismael Faro
Distinguished Engineer and
Chief Architect Quantum
Computing, Cloud, & Software
IBM Quantum
Jay Gambetta
IBM Fellow and Vice President
Quantum Computing
IBM Quantum
Jeannette Garcia
Senior Research Manager
Quantum Applications and Software
IBM Quantum

Abhinav Kandala Youngseok Kim Antonio Mezzacapo Jason Orcutt Katie Pizzolato
Research Staff Member Research Staff Member
Mamber Principal Research Scientist Principal Research Scientist Director, IBM Quantum Strategy
IBM Quantum IBM Quantum Technical Lead IBM Quantum and Applications Research
IBM Quantum IBM
IBM Quantum
Quantum

Sarah Sheldon Matthias Steffen Maika Takita Kristan Temme Christy Tyberg
Senior Manager IBM Fellow and Research Staff Member Research Staff Member Senior Manager
Quantum Theory Chief Quantum Architect IBM Quantum IBM
IBM Quantum
Quantum Quantum Computing
and Capabilities IBM Quantum IBM Quantum
IBM
IBM Quantum
Quantum

v
vi
 First, there was theory. Darío Gil
Senior Vice President and
Charlie Bennett first wrote the words “quantum information theory” in his notebook in 1970. Paul
Director of IBM Research
Benioff, Richard Feynman, Yuri Manin, and other quantum computing pioneers of the early 1980s
used math and theoretical quantum mechanics to argue their case. Their message was clear:
A computer is a physical system. If you want to efficiently compute the “non-computable,” you
had to rethink how to do computation. Quantum mechanics offers a rich computational model—
therefore, we had to build a quantum computer.

Then came qubits. Just like that, with the first two-qubit quantum computer built in 1998, theory
started to morph into reality. Qubits are the building blocks of a quantum computer, and today
at IBM we make them out of tiny superconducting circuits that behave like atoms. They can be in
linear combinations of multiple states, can interfere, and be entangled—so that when one qubit
changes its state, its entangled partner does, too.

Sounds mind-boggling, and it is.

Foreword It’s the weird but wonderful realm of quantum mechanics, and we’ve managed to harness its powers.
It’s these abilities of qubits to entangle and interfere that should allow future quantum computers to
perform more powerful computations than traditional computers will ever be able to do.

Now, we are fast approaching the development of practical applications that exhibit Quantum
Advantage—when quantum plus classical computers could soon outperform the use of classical
computers alone in a meaningful task. We expect to see this achievement this decade. Our quantum
computing systems continue to improve in scale, quality, and speed of operation. We have ever more
powerful tools to combine classical and quantum methods that allow us to run ever more complex
computations. For years now, researchers, developers, and other domain experts across industry and
academia have been part of a growing quantum-ready workforce, using IBM’s quantum computers
through the cloud to explore new applications and formulate practical problems that will be crucial
to achieving Quantum Advantage.

I urge others to join them, too.

By exploring quantum computers’ possibilities today, we are shaping the world of tomorrow. Whether
you work for a bank, a chemical company, an airline, or a manufacturing giant, quantum computation
could give your industry an edge. Soon, a quantum-centric supercomputer could be used to uncover
previously inaccessible solutions to simulations of nature and structure in data that can help us find
new materials, more efficiently extract insights from data, or accurately predict risk.

Read The Quantum Decade to find out how you, too, can be quantum ready—and how this bleeding-
edge technology can help you and your business thrive the moment quantum computers come of age.

Because that moment is closer than you think.

1
 Insights

Priorities of a The future The discovery-driven

post-pandemic of computing enterprise
world

As entire industries face greater The integration of quantum Enterprises will evolve from
uncertainty, business models computing, AI, and classical analyzing data to discovering
are becoming more sensitive computing into hybrid cloud new ways to solve problems.
to and dependent on new workflows will drive the most When combined with hyper-
technologies. Quantum com- significant computing revolution automation and open integration,
puting is poised to expand the in 60 years. Quantum-powered this will ultimately lead
scope and complexity of busi- workflows will radically reshape to new business models.
ness problems we can solve. how enterprises work.

2
The Quantum Decade

Introduction

For decades, quantum computing has been viewed as a futuristic technology:

it would change everything, if it ever moved from the fantastical to the practical.
Even in recent years, despite billions of dollars in research investment and
extensive media coverage, the field is sometimes dismissed by real-life decision
makers as too arcane, a far-off, far-out pursuit for academics and theorists. As
we progress through the Quantum Decade—the decade when enterprises
begin to see business value from quantum computing—that perspective is
quickly becoming an anachronism.

Because quantum computing is coming of age, and leaders who do not understand and adapt to the
Quantum Decade could find themselves a step — or more accurately, years — behind. Over the next few
years, we foresee a profound computing revolution that could significantly disrupt established business
models and redefine entire industries. Historically, crises have been the impetus for both new technologies
and their widespread adoption. World War I ushered in factory processes that are still in place today.
The Cold War accelerated the creation of the Advanced Research Projects Agency Network (ARPANET), a
predecessor to the internet, in the late 1960s. And COVID-19 drove an increased need for agility, resiliency,
and accelerated digital maturity. We anticipate quantum computing — in combination with existing advanced
technologies — will dramatically impact how science and business evolve. By accelerating the discovery
of solutions to big global challenges, quantum computing could unleash positive disruptions significantly
more abrupt than technology waves of the past decades.

3
 Perspective
The basics

Understanding the
exponential power of
quantum computing
To the nth degree
The power of exponential growth

Qubits 2 3 10 16 20 30 35 100 280

more than all more than all
Classical bits 512 1,024 16 1 17 17 550 the atoms on the atoms in
required to
bits bits kilobytes megabyte megabytes gigabytes gigabytes the planet Earth the universe
represent an
entangled state

Classical computer bits can store information as either a 0 or 1. That the physical
world maintains a fixed structure is in keeping with classical mechanics. But as
scientists were able to explore subatomic matter, they began to see more probabi-
listic states: that matter took on many possible features in different conditions.
The field of quantum physics emerged to explore and understand that phenomena.

The power of quantum computing rests on two cornerstones of quantum

mechanics: interference and entanglement. The principle of interference
allows a quantum computer to cancel unwanted solutions and enhance
correct solutions. Entanglement means the combined state of the qubits
contains more information than the qubits do independently. Together, these
two principles have no classical analogy and modeling them on a classical
computer would require exponential resources. For example, as the figure
above describes, representing the complexity of a 100-qubit quantum computer
would require more classical bits than there are atoms on the planet Earth.

4
The building blocks of quantum computing are already emerging.
Quantum computing systems are running on the cloud at an
unprecedented scale, compilers and algorithms are rapidly Hybrid cloud
advancing, communities of quantum-proficient talent are on the Secure, heterogeneous
rise, and leading hardware and software providers are publishing computational fabric
technology roadmaps.1 The technology’s applicability is no longer
a theory but a reality to be understood, strategized about,
and planned for. And good news: the steps you should take to
prepare for future quantum adoption will begin to benefit your
business now.

Neurons
Quantum computing will not replace classical computing, it
AI systems
will extend and complement it. But even for the problems that
quantum computers can solve better, we will still need classical Bits
computers. Because data input and output will continue to Classical high-
be classical, quantum computers and quantum programs will performance
require a combination of classical and quantum processing. computer systems

It is precisely the advances in traditional classical computing,

plus advances in AI, that are driving the most important revolution
in computing since Moore’s Law almost 60 years ago.2 Quantum
computing completes a trinity of technologies: the intersection Qubits
of classical bits, qubits, and AI “neurons.” The synergies created Quantum systems
by this triad — not quantum computing alone — are driving the
future of computing (see Figure 1).

FIGURE 1

The most exciting computer

revolution in 60 years
The convergence of three
major technologies

5
 “The time between the first Industrial Revolution and the second was around 80 years, and from
the second to the third around 90 years. But the time between the third and the fourth was
reduced to about 45 years thanks to disruptions enabled by semiconductors such as the Internet
of Things (IoT), artificial intelligence (AI), machine learning, virtual reality, and 4G. I expect the
time to Industry 5.0 will be further accelerated to roughly 30 years by quantum computing and
many additional disruptions.”

Ajit Manocha
President and CEO, SEMI

Phase 1 Phase 2 Phase 3

Awareness Readiness Advantage

Computing paradigm Accelerating digital Where quantum computers

evolving from an age transformation in the plus classical systems can
of analytics to an age context of preparing for do significantly better than
of discovery quantum computing classical systems alone

FIGURE 2

The path to Quantum Advantage

Taking a foundational approach
with digital transformation

The IBM Institute for Business Value (IBV) has been deeply engaged in conducting more than a dozen
industry- and practice-based studies on quantum computing.3 We’ve elevated that research here with new
insights gleaned from interviews with more than 75 experts, including IBM quantum computing researchers
as well as clients, partners, and academics. This report on the Quantum Decade provides executives with
strategies to prepare for the upcoming business transformation from quantum computing. It identifies the
most important factors, themes, and actions to take at this significant inflection point.

What makes this the Quantum Decade? What will the quantum-powered world look like? And what can and
should farsighted leaders and organizations do now to educate and position themselves effectively? The key
learnings revolve around three phases of organizational evolution: awareness, readiness, and advantage
(see Figure 2).

6
 Awareness
According to the IBV’s 2021 CEO study, 89% of the more than 3,000 chief executives surveyed
did not cite quantum computing as a key technology for delivering business results over the
next two to three years.4 For the short term, that’s understandable. Given the technology’s
disruptive potential this decade, CEOs should start mobilizing resources to grasp early learnings
and start the journey to quantum now. CEOs who ignore quantum’s potential are taking a
substantial risk, as the consequences will be much greater than missing the AI opportunity
a decade ago.5

Phase 1 of the quantum computing playbook requires broad recognition that the landscape is
changing. The primary shift is a computing paradigm that’s evolving from an age of analytics
(looking back at established data and learning from it) to an age of discovery (looking forward
and creating more accurate models for simulation, forecasting, and optimization). There’s real
potential for uncovering solutions that were previously impossible.

“CEOs of Fortune 500 companies have a once-in-a-lifetime

opportunity. They cannot afford to play catch-up. It’s time
to break tradition and educate themselves about what
quantum computing can do for them.”

Ilyas Khan
Founder and CEO
Cambridge Quantum Computing

7
 Readiness
Enterprises cannot use quantum computing to solve big problems
yet. But quantum computing has shattered timelines and exceeded
expectations at every phase of development. It’s not too soon for
organizational leaders to explore how the advent of this new technology
could alter plans and expectations. Phase 2 involves investigating
big questions: How could your business model be disrupted and
reshaped? How could quantum computing supercharge your current
AI and classical computing workflows? What is the quantum computing
“killer app” for your industry? How can you deepen your organization’s
quantum computing capabilities, either internally or through ecosys-
tems? Now is the time to experiment and iterate with scenario plan-
ning. Find or nurture talent who are fluent in quantum computing and
capable of educating internal stakeholders about the possibilities, and
partner for “deep tech” quantum computing resources.

But just as important is another critical question: What does your orga-
nization need to establish now to apply quantum computing when it’s
production-ready? Indeed, laying the foundation for quantum comput-
ing also means upping your classical computing game. Enhanced pro-
ficiencies in data, AI, and cloud are necessary to provide the required
fertile ground for quantum computing. Accelerating your digital trans-
formation in the context of quantum computing readiness will provide
a pragmatic path forward while delivering significant benefits now.
After all, quantum computing doesn’t vanquish classical computing.
The trinity of quantum computing, classical computing, and AI form
a progressive, iterative partnership in which they’re more powerful
together than separately.

“When people think of quantum computing now, they think

of researchers trying to figure out how to apply quantum
computing. Ten years from now, those questions will be
answered. At that point, it will be about whether you are
using quantum computing in ways others are not.”

Prineha Narang
Assistant Professor of Computational Materials Science
Harvard University

8
 Advantage
Phase 3, Quantum Advantage, occurs when a computing task of inter-
est to business or science can be performed more efficiently, more cost
effectively, or with better quality using quantum computers. This is the
point where quantum computers plus classical systems can do signifi-
cantly better than classical systems alone. As hardware, software, and
algorithmic advancements in quantum computing coalesce, enabling
significant performance improvement over classical computing, new
opportunities for advantage will emerge across industries. But prioritizing
the right use cases — those that can truly transform an organization or
an industry — is critical to attaining business value from quantum.

Getting to Quantum Advantage will not happen overnight. But while

that advantage may progress over months and years, it can still trigger
exponential achievements in usage and learning. From exploring the
creation of new materials to personalized medical treatments to radical
shifts in business models across the economy, change is coming.
Organizations that enhance their classical computing capabilities and
aggressively explore the potential for industry transformation will be
best positioned to seize Quantum Advantage.

“There is a huge competition in the ‘big problem’ space

in the energy industry. Whoever gets there first will
have a significant advantage.”

Doug Kushnerick
formerly with Technology Scouting and Ventures
ExxonMobil Research and Engineering

“The best of quantum computing is yet to come. There are

applications where we presume Quantum Advantage will play
out. And there is a vaster space of quantum computing
applications that we don’t know yet. That’s what will redefine
what’s possible.”

Irfan Siddiqi
Director of the Advanced Quantum Testbed
Lawrence Berkeley National Laboratory
Professor of Physics
University of California, Berkeley

9
 Perspective
Head-spinning facts
about quantum computing
(that you may not need to know)

To say the least, much about quantum computing is counterintuitive.

While you do need to understand quantum computing’s power and
potential to develop strategies and evaluate use cases, the good news
is you don’t need to be a quantum physicist or theorist—that’s what your
partners and ecosystems are for. Still, interesting facts to ponder:

Fact one. Quantum computing exploits a fundamental principle of

quantum mechanics — that a physical system in a definite state can
still behave randomly. The system is in a superposition, which is a
linear combination of two or more states.

Fact two. Classical computing bits are either a 0 or a 1. But in

quantum computing, quantum bits, or qubits, can be in an infinite
number of states all at the same time, a superposition of both 0 and
1. Think of a coin. If you flip a coin, it’s either up or down. But if you
spin a coin, its dimensional possibilities increase exponentially.

Fact three. Along those same lines, in binary logic, things either
“are” or they “are not.” Quantum computers don’t have this
limitation, allowing a more accurate reflection of reality.

Fact four. Superpositions are not inherently quantum. For

example, when several music tones create sound simultaneously,
the surrounding air is in a superposition. What’s unique to
quantum mechanics is that in some circumstances when you
measure a quantum superposition, you get random results, even
though the state of the system is definite.

Fact five. Measuring a classical bit doesn’t change it. If a bit is

a 0, it measures as a 0, and the same for a 1. But if the qubit is in a
quantum superposition, measuring it turns it into a classical bit,
reflecting a 0 or 1.

10
 Perspective
Three types of problems made
for quantum computing

Fact six. Entanglement is a property of a quantum system in In the near-to-medium term, quantum
which two qubits that are far apart behave in ways that are computing could be especially adept at
individually random, yet are inexplicably correlated. Two solving three types of problems:
entangled qubits individually measured can give random
results. But when you look at the system as a whole, the
state of one is dependent on the other. The combined system
contains more information than the individual parts. Hard to
simulation
wrap your head around? Einstein himself called it “spooky such as modeling processes and
action at a distance.”6 systems that occur in nature;

Fact seven. Quantum computers can use interference to cancel

paths that lead to incorrect solutions and enhance the paths
search and graph
containing the correct solution.
involving searching for the best or
“optimal” solution in a situation
Fact eight. Noise causes qubits to lose their quantum mechan- where many possible answers exist;
ical properties, hence they must be kept isolated from any
source of noise. There are different ways to build qubits. A
leading way is leveraging superconductivity to build devices and algebraic
with quantum mechanical properties that can be controlled at
problems
will. But for the qubits to work, they have to be kept in a “super-
fridge” at extremely cold temperatures of 10 to 20 millikelvins including applications for
— colder than the vacuum of space.7 machine learning.

11
 Insights

Tackling the The 1,000-qubit The hybrid The power of

world’s problems milestone cloud future ecosystems

From discovering new drugs Quantum computing hardware Many quantum programs Quantum computing ecosystems —
to managing financial risk to has been on a trajectory to involve interactions between with opportunities for collabor-
re-engineering supply chains, scale from 127 qubits in 2021 classical and quantum hard- ative innovation and open-source
there is an urgency to accel- to 1,000 qubits by 2023 to ware. But these interactions development — are fast becoming
erate solutions to increasingly practical quantum computing, introduce latencies, or delays, fertile grounds for training users
complex societal, macroeco- characterized by systems exe- which must be reduced to to apply quantum computing to
nomic, and environmental cuting error-corrected circuits optimize capacity. This makes real problems.
problems on a global scale. and widespread adoption, by hybrid clouds the most viable
2030. Cloud-based open-source future for quantum computing.
development environments
will make using quantum
computers “frictionless.”

12
Chapter One

Quantum awareness
and the age
of discovery

When new technologies emerge, they can be daunting to comprehend

fully—especially when they’re as complex as quantum computing.
But developing a base understanding is critical for appropriately aligning
both technology and business strategies.

In this chapter, we explain the case for quantum computing — what is happening now to create
an inflection point — and then explore how the triad of classical computing, AI, and quantum
computing will move us from an age of analytics driven by mining data for insights to one
defined by accelerated experimentation and discovery. We also outline the implications for
enterprises in a discovery-driven environment.

13
 The case for the
Quantum Decade

The Quantum Decade will be driven by mounting pressure to solve

the biggest business and societal computational problems, a trajectory
toward practical quantum computing by decade’s end, and ecosystems
of developers that can unleash this power onto real, intractable
problems (see Figure 3).

FIGURE 3

What makes this the

Quantum Decade?
Three factors propelling us forward

Mounting pressure Quantum technology Quantum ecosystems

to solve exponential at a tipping point scaling
problems

Discovery of Hardware scaling from Open innovation fosters

new materials 127 qubits in 2021 to collaborative learning
1,000 qubits in 2023

Managing complex Software developments Users trained to apply

financial risk for frictionless quantum quantum computing to
computing real-world problems

Re-engineering supply Algorithmic improvements Billions of circuits on IBM

chains for resilience and greater circuit quality, Quantum services per day
capacity, and variety

14
An increased urgency to solve big problems
Imagine discovering new materials for solar panels that help us obtain clean energy more efficiently.
Or accurately simulating aircraft parts in minutes as opposed to years. Envision drug development that
can sometimes grind on for a decade coming to fruition in months.

Increasingly, these problems fall into ambitious, industry-altering, data-driven science. In this realm,
enterprise discovery builds on data and AI, accelerating cycles of exploration that allow organizations
to aggregate knowledge, resolve questions, and enhance operations and offerings.8

Planetary-scale issues such as climate change, world hunger, and the possibility of more pandemics
require powerful new tools to achieve breakthroughs. Quantum computing can help expedite
solutions to these complex computational problems that face business and society.

The information we need for significant breakthroughs on global problems may exist — but we lack
the computing power to harness and use it productively. To understand why requires some background.
Classical computing has long enabled an age of analytics. Existing systems rely on storing and manipulating
individual computing bits — saved in binary form as either 1s or 0s — that help us process vast volumes of
data. Quantum computers work in a fundamentally different way via so-called quantum bits or qubits,
which can represent information using more dimensions (see Perspective, “Head-spinning facts about
quantum computing” on page 10). Exploiting the properties of quantum mechanics, quantum computers
excel at the challenge of evaluating multitudes of options that lend themselves well to these properties —
and exploring problems that have thus far been intractable.

15
 The quantum tipping point
Quantum computing is not new. It’s been the subject of theories
and experiments since it was first postulated by Paul Benioff,
Richard Feynman, and others in the early 1980s.9 During the
1990s, preliminary mathematical and algorithmic work took
place; the 2000s focused on physically representing qubits;
and in the 2010s, multi-qubit systems were demonstrated to
be viable, as well as accessible on the cloud (see Figure 4).

1927 1980 1997

The Uncertainty Paul Benioff’s Topological
Principle quantum mechanical codes
model of computers

1935 1970 1994

The EPR Birth of quantum Shor’s
Paradox information theory factoring
algorithm

pre-1964

Quantum Quantum
Bell’s cryptography error
Inequality (IBM) correction

1964 1984 1995

FIGURE 4

A quantum leap
Historic milestones in
quantum computing

16
 The advance of quantum computing has reached a tipping point. picture. For example, quantum scientists and engineers are developing
In 2020, the state of the art in quantum computing was an IBM ways to link different genres of processors together into scalable
system with 65 qubits. That doubled to 127 qubits in 2021, tripled modular systems that could transcend the limitations that exist today.
to more than 400 qubits in 2022, and more than doubled again to
over 1,000 qubits in 2023. The combination of classical and quantum parallelization techniques
and multichip quantum processors can scale quantum computing
But to reach their full potential, quantum computers could require with modular hardware and the accompanying control electronics
hundreds of thousands—perhaps even millions—of high-quality and cryogenic infrastructure. Pushing modularity in both software and
qubits. And while qubit number is often used as a milestone, it hardware will be key to achieving scale well ahead of our competitors
doesn’t tell the whole story. It’s just one component of the bigger this decade.10

2017 2023
Quantum demonstrations Evidence of
0(10) qubits quantum utility

Quantum applications Technical working

using hardware-efficient groups established
quantum circuits (IBM)

2001 2007 Quantum error mitigation 2022

developed (IBM)
Experimentally The transmon Probabilistic error
factoring 15 superconducting Provable Quantum cancellation in noisy
(IBM) qubit Advantage with quantum processors
short-depth circuits (IBM)

Error mitigation for universal

gates on encoded qubits
IBM makes quantum
Circuit Coherence time computing available Provable exponential speed-up
QED improvement on IBM Cloud using quantum kernels

2004 2012 2016 2021

17
 To that end, the IBM quantum computing roadmap ushers in the age
of the quantum-centric supercomputer and lays out a path toward
frictionless quantum computing (see Figure 5). The quantum-centric
supercomputer will incorporate quantum processors, classical processors,
quantum communication networks, and classical networks, all working
together within an intelligent quantum software orchestration platform
to completely transform how computing is done.

2019 2020 2021 2022 2023 2024 2025 2026+

Run quantum Demonstrate Run quantum Bring dynamic Enhancing Improve Scale quantum Increase accuracy
circuits on the and prototype programs 100x circuits to applications accuracy of applications and speed of
IBM Cloud quantum faster with Qiskit Runtime with elastic Qiskit Runtime with circuit quantum workflows
algorithms and Qiskit Runtime to unlock more computing and with scalable knitting toolbox with integration of
applications computations parallelization of error mitigation controlling error correction
Qiskit Runtime Qiskit Runtime into Qiskit Runtime

Model Prototype quantum Quantum software applications

developers software applications
Machine learning Natural science Optimization

Algorithm Quantum Serverless

Quantum algorithm and application modules
developers
Intelligent orchestration Circuit knitting toolbox Circuit libraries
Machine learning Natural science Optimization

Kernel
Circuits Qiskit Runtime
developers
Dynamic circuits Threaded primitives Error suppression and mitigation Error correction

Quantum Falcon Hummingbird Eagle Osprey Condor Flamingo Kookaburra Scaling to

systems 10K—100K qubits
with classical
and quantum
communication
27 qubits 65 qubits 127 qubits 433 qubits 1,121 qubits 1,386+ qubits 4,158+ qubits

Heron Crossbill

133 qubits x p 408 qubits

FIGURE 5

The IBM quantum computing roadmap

Recent progress and looking ahead

18
“Moore’s Law is coming to an end and classical computing is
reaching its limits just as our demand is starting to surge.”

Richard Debney
Vice President, Digital Technology
BP

A quantum-centric supercomputer can serve as an essential technology to help solve the

world’s toughest problems. It could open up new, large, and powerful computational spaces
for industries globally, and enable useful applications sooner than most are expecting based
on a purely fault-tolerant perspective.

In addition to scale, other attributes are required. In 2019, IBM developed the Quantum Volume
(QV) metric to measure the computational power of a quantum computer. QV addresses highly
technical issues, including gate and measurement errors, crosstalk, device connectivity, and
compiler efficiency. Other vendors are starting to report their progress on computational quality
using QV.

IBM has been successfully doubling QV every year. In fact, IBM doubled it three times in 2020.
This is a Moore’s Law level of increase, even as Moore’s Law itself has been abating for
traditional computing (see Perspective, “Classical computing – The trouble with Moore’s
Law” on page 20).

As quantum computing evolves and begins to tackle practical problems, how much work quan-
tum computing systems can do in a given unit of time merits greater attention. Real workloads
will involve quantum-classical interactions—full programs that invoke a quantum processor as
an accelerator for certain tasks, or algorithms requiring multiple calls to a quantum processor.
Consequently, the runtime system that allows for efficient quantum-classical communication
will be critical to achieving high performance.

This runtime interaction is embedded in IBM’s proposal for the Circuit Layer Operations Per
Second (CLOPS) benchmark.11 CLOPS is a metric correlated with how fast a quantum processor
can execute circuits—specifically, the metric measures the speed the processor can execute
layers of a parameterized model circuit of the same sort used to measure Quantum Volume.

One of the key aims for productive use of quantum hardware is to support a variety of circuits,
with the ability to create more complex circuits, including, for example, dynamic circuits.
Dynamic circuits use very low latency classical instructions that can exploit information obtained
from measurements occurred during the circuit to define future components of the circuit. This
enables the construction of more efficient quantum circuits and is a fundamental capability
needed for quantum error correction. Quantum error correction can protect quantum informa-
tion by using multiple physical qubits to encode information in a single logical qubit. Quantum
computers must be able to run a diversity of circuits to effectively solve a variety of problems
(see case study, “Woodside Energy” on page 21).

19
 Perspective
Classical computing
The trouble with Moore’s Law

In 1965, Gordon Moore observed that the number of transistors

Log2 of the number of computations
on a given area of a silicon computer chip was doubling every
per integrated function
year. He predicted this doubling of density would continue well
16 into the future, though the time frame was later revised to 18 to
15 24 months.12
14

13
For Moore’s Law to survive this long, chip designers and engi-
12

11
neers have consistently shrunk the size of features on chips.
10 The most advanced laboratories today are experimenting with
9
chip features that measure only 5 nanometers. (A nanometer is
8
1 billionth of a meter.) These features are so small that some
7

6
need to be measured in individual atoms.
5

4 But now, physical limits are creating serious headwinds for

3
Moore’s Law. Some chip industry leaders point to the massive
2

1
expense and effort required to sustain it. One estimate is that
the research effort to keep Moore’s Law on track this far has
1959 1961 1963 1965 1967 1969 1971 1973 1975
increased by a factor of 18 since 1971.13 And the facilities needed
to build modern chips are growing increasingly expensive. For
Quantum example, Samsung’s new chip plant, under construction in Texas,
Volume (QV) will cost more than $25 billion.14

What all this indicates: the slowdown of improvements in clas-

104

sical computing only escalates the importance of integrating

quantum computing with classical systems.
103

QV 512

102

101

2017 2019 2021 2023 2025 2027 2029

Doubling up
Scaling Quantum Volume
by 2x per year

20
Woodside Energy
Introducing quantum
kernels into classical
machine learning workflows 15

In classical machine learning, algorithms sometimes use to the quantum computer and make it more practical, the team
kernels (similarity measures between two pieces of data) to began research combining quantum kernels with classical
solve classification or regression problems. Usually, kernels algorithms for matrix completion that answers the following
are used to increase the dimensionality of the data to separate question: Taking a collection of kernel values calculated using a
it, thereby boosting accuracy of the algorithm. Recently, IBM quantum computer, could the researchers use that information
researchers proved the existence of quantum kernels providing with the classical algorithm to accurately predict what an
a super-polynomial advantage over all possible classical binary uncalculated value might be?
classifiers and requiring only access to classical data.
Investigating this approach raised some essential questions,
Researchers from Woodside Energy, a leading natural gas including: Could leveraging state-of-the-art completion tech-
producer in Australia, saw an interesting opportunity to niques lower the number of queries required, thereby making
collaborate with IBM’s quantum researchers. Could quantum the use of quantum kernels more practical, more quickly? Do
kernels be practically deployed in industry-relevant classical these kernels provide useful benefits to Woodside Energy, such
machine learning workflows? as enhanced classification accuracy in their industry data sets?
Can predictions be made relating properties of quantum circuits
As part of their exploration of quantum computing, the teams to the ease with which quantum kernels can be completed?
wanted to understand how to define those kernels using
quantum circuits and reduce the amount of quantum com- Woodside Energy considers this research a “pathfinder project”
puting resources required to evaluate them. This involved that establishes a foundation for subsequent experimentation.
connecting properties of quantum circuits to properties of The company is continuing this line of thinking by researching
kernels and assessing how well those kernels worked. literature about other quantum circuit families used as building
blocks for other applications. Going forward, the additional data
The commonly understood way of using quantum kernels in can help Woodside refine its predictions about the tractability
classical machine learning workflows requires one query to of quantum kernels and where they could be most useful. One
a quantum processor for every kernel value to be calculated. potential use case: applying this technology to petrophysical
Instead of evaluating every value this way, to reduce the calls analysis of well log data.

21
 IBM, the University of Tokyo,
and the University of Chicago
Partnering to develop a
100,000-qubit quantum-centric
supercomputer 16

In May 2023, IBM announced a 10-year, $100 million initiative with the University
of Tokyo and the University of Chicago to develop a quantum-centric supercomputer
powered by 100,000 qubits. This 100,000-qubit system would serve as a foundation
for tackling challenges that even today’s most advanced supercomputers may never
be able to solve.

For example, this imposing quantum system could unlock entirely new understandings
of chemical reactions and molecular process dynamics. These insights could expand
climate change research through modeling better methods to capture carbon. What may
also be possible: discovering new materials to build batteries for electric vehicles and
energy grids and developing more energy-efficient fertilizers.

This effort will take the proverbial village on a global scale—it calls for collaboration
and an activation of talent and resources across industries and research institutions. By
collaborating with the University of Chicago, the University of Tokyo, and IBM’s broader
global ecosystem, IBM will devote much of the next decade to developing and progress-
ing the underlying technologies for this system, as well as to designing and building the
necessary components at scale.

Development of this quantum-centric supercomputer will require innovation at all levels

of the computing stack. It will exploit modularity and communication—and use a layer
of middleware for quantum to seamlessly integrate quantum and classical workflows
via hybrid cloud.

The design must meet the challenge of integrating high-performance computing and
quantum processors, as well as break new ground in quantum communication and
computing technology.

This system’s foundation will include milestones IBM has already outlined in its Quantum
Development Roadmap (see page 18). This includes the ability to scale and connect growing
numbers of quantum processors through quantum and classical interconnects, as well as
technology to mitigate errors to fully harness noisy yet powerful quantum processors.

22
 IBM is working toward debuting three cornerstones of its necessary architecture for
quantum-centric supercomputers:

— The new 133-qubit IBM Heron processor. This processor is a complete redesign of IBM’s
previous generations of quantum processors, with a new two-qubit gate to allow higher
performance. It will also be compatible with future extensions to enable modular connected
processors to grow the size of the computer.

— The introduction of IBM Quantum System Two. The new flagship system is designed to be
modular and flexible to introduce elements of scaling in its underlying components, including
classical control electronics and high-density cryogenic wiring infrastructure.

­— The introduction of middleware for quantum. A set of tools to run workloads on both
classical and quantum processors. This includes tools for decomposing, parallel executing,
and reconstructing workloads to enable efficient solutions at scale.

IBM plans to work with university partners and its worldwide quantum ecosystem to evolve
how its quantum processors can be connected via quantum interconnects. This work will
strive to enable high-efficiency, high-fidelity inter-processor quantum operations and a reliable,
flexible, and affordable system component infrastructure to allow scaling to 100,000 qubits.

Quantum-centric supercomputing
A concept rendering of IBM
Quantum’s 100,000-qubit
quantum-centric supercomputer,
expected to be deployed by 2033

23
 “Quantum computing is not just an expansion of classical
computing. We can’t just port problems to quantum computers.
We need to break them down and build communities that can
effectively apply this technology to the right problems.”

Richard Debney
Vice President, Digital Technology
BP

But the speed and power of quantum computing alone do not define the Quantum Decade.
The exponential increase of qubits is impressive, but if that brute computing force is inaccessible
and inapplicable to real problems, we’re back to abstract theory.

Fortunately, the power of quantum is accessible. Historically, if you wanted computing power,
you had to build or install and maintain the machines yourself. But now, thanks to the cloud,
even highly sophisticated quantum computers are attainable.

In fact, a programmer can sit at his or her laptop and create a quantum circuit using quantum
gates. When the software sends the circuit via the cloud to a quantum computer, the machine
converts those gates into microwave pulses. In turn, the pulses control the physical qubits,
which work their magic on the problem at hand. The results are returned — translated back
into classical bits — to the programmer.17 This frictionless interface is what will unleash quantum
computing to today’s developer communities.

Open ecosystems are scaling

A decade ago, quantum computing experts were predominantly Ph.D. physicists in labs —a
valuable commodity that’s still in short supply. But communities of developers, not necessarily
Ph.D.s or other physicists, are beginning to appear. These communities include chemists,
electrical engineers, and mathematicians, among others. They’re learning and applying
quantum concepts, even in classical computing environments.

Ecosystems fostering open innovation have sprung up and are training software developers to apply
quantum computing to real problems. IBM started one such open-source community, Qiskit, to
build the necessary code development tools and libraries for quantum developers. The community
also offers skills development for thousands of quantum students. Billions of quantum circuits are
run per day over IBM Quantum Services using real quantum computers.18

24
Quantum-enabled
cell-centric therapeutics
Pioneering new research in
healthcare and life sciences 19

Quantum computing is making its mark in fields such as cryptan- These technologies include:
alysis, natural science simulations, and optimization. Yet there is
— Quantum convolutional neural networks (QCNNs) to learn optimal
still much to learn about the potential of quantum computing
chimeric antigen receptor (CAR) T-cell intracellular signaling domain
simulations in the realm of healthcare and life sciences (HCLS).
design from limited experiment data

Quantum-enabled tools could soon go much further in addressing — Hybrid classical-quantum graph neural networks (GNNs) to model
some HCLS challenges and computing problems. Quantum algo- tumor microenvironments from single cell spatial data­
rithms use a significantly different computing paradigm that could
— Single cell perturbation response using quantum conditional
potentially represent biological data—and learn from it—more
optimal transport (OT)
efficiently. This could enable researchers to explore new frontiers
for biological research and enable biomedical discoveries. — Quantum-enhanced topological data analysis (QTDA) to identify
topological signatures of single cell perturbation response.
In particular, consider therapeutic design and discovery. This
research realm has traditionally focused on drug-target identification Insights from each research area can be valuable in and of themselves,
and interaction optimization. While quantum-applicable algorithms and they can also be combined in various ways to provide insights
exist, researchers have typically taken classical approaches. It’s that can empower researchers to provide new treatment options that
a strategy that has led to the approval of many novel therapeutics optimize the cellular context and improve therapeutic response.
(for example, small molecule inhibitors, chemotherapeutic, and
antibody therapies) across a multitude of diseases. For example, by developing a comprehensive understanding of how
cancer cells behave—and modeling that behavior both individually
However, since the 1950s, research and development costs per and in aggregate—treatment plans can emerge. These new treat-
new approved drug have been doubling every nine years.20 For ments could potentially be developed to manipulate a cancer and
many diseases, effective therapies remain elusive. In fact, target- its tumor microenvironment into a more therapeutically responsive
centric approaches may be reaching the point of diminishing returns. state. Or treatment could shift the tumor into an indolent phase that
transforms the disease into a more manageable, chronic condition.
But there’s hope. Researchers are making significant progress
with quantum-enabled cell-centric therapeutics. Spatiotemporal Quantum computing may serve as an enabler in this cell-centric
single-cell, cell-line, imaging, drug profile, and clinical data are approach to therapeutic design. This use case illustrates just one
analyzed with four quantum computing technologies that can example of how quantum computing can significantly contribute
capture varying aspects of cellular behavior. to HCLS.

25
 From analysis
to discovery

The advances in quantum computing have been significant, but

what are their practical implications? How will they impact our
ability to address complex problems at scale?

In its early days, science was empirical and theoretical. People

observed and measured phenomena, such as the motion of objects;
made hypotheses and predictions about why they happened; and
tested them repeatedly. Computers—and eventually AI and super-
computers—changed that, ushering in the age of analytics. We can
now ingest massive amounts of data and develop models for how
systems will behave. We can also now model chemical systems,
move individual atoms, and simulate how some materials will
perform or react over millions of uses.

But some challenges remain beyond our reach. While we may be able
to model a chemical system, these classical models work well for
problems where we already have data. These models are not based
on the underlying physics of how molecules behave and are therefore
imprecise. We don’t have the toolset to address these shortcomings.
As powerful as it is, classical computing has fundamental limitations
in the face of exponential problems (see Figure 6).

FIGURE 6

Progress through the ages

The road to quantum-
accelerated discovery

1st paradigm 2nd paradigm 3rd paradigm 4th paradigm 5th paradigm

Empirical Theoretical Computational Big-data-driven Quantum-accelerated

science science science science discovery

Observations Scientific laws Simulations Big data Scientific knowledge at scale

Experimentation Physics Molecular dynamics Machine learning AI-generated hypotheses
Biology Mechanistic models Patterns Autonomous testing
Chemistry Anomalies
Visualization

Pre-Renaissance ~1600s ~1950 ~2000 ~2020

Increasing speed, automation, and scale

26
27
 IBM and Cleveland Clinic
Using the power of
quantum to tackle key
healthcare challenges 21

IBM and Cleveland Clinic, a nonprofit academic medical center

that integrates clinical and hospital care with research and educa-
tion, have announced a planned 10-year partnership to establish
the Discovery Accelerator. Cleveland Clinic and IBM will strive to
advance discovery in healthcare and life sciences through high-
performance computing using hybrid cloud, AI, and quantum
computing technologies.

Through the Discovery Accelerator, researchers anticipate using

advanced computational technology to generate and analyze data
to help enhance research in the new Global Center for Pathogen
Research & Human Health. Research is expected to focus on areas
such as genomics, single-cell transcriptomics, population health,
clinical applications, and chemical and drug discovery.

In March 2023, Cleveland Clinic and IBM unveiled the first quan-
tum computer delivered to the private sector and fully dedicated
to healthcare and life sciences. The IBM Quantum System One
machine sits in the Lerner Research Institute on Cleveland Clinic’s
main campus and will help supercharge how researchers devise
techniques to overcome major health issues. This quantum
program will be designed to engage with universities, government,
industry, start-ups, and other organizations. It will leverage
Cleveland Clinic’s global enterprise to serve as the foundation of
a new quantum ecosystem for life sciences, focused on advancing
quantum skills and the mission of the center.

In addition to the on-premises IBM Quantum System One, Cleveland

Clinic will have access to IBM’s current fleet of more than 20 quan-
tum systems, accessible via the cloud. With the unveiling of IBM’s
next-generation 1,000+ qubit quantum system, Cleveland Clinic is
slated as the site of the first private-sector, on-premises system.

28
 That’s where quantum computing, in combination with classical
computers and AI, comes in. This triad is poised to generate
discovery at a radically faster pace. Consider the amazing impact
of research involving mRNA, a single-stranded RNA molecule
that is complementary to one of the DNA strands of a gene.22 This
research expedited COVID-19 vaccine development: decoding
the virus to vaccine creation took only a few weeks, followed by
months of clinical trials and broad release in a year.23 Yet this was
only possible because we already had a decade’s worth of mRNA
research to leverage.

With quantum computing, that kind of discovery might itself be

compressed, especially when starting with a blank slate, vastly
accelerating vaccine development and efficacy and easing the
pain of future pandemics.

So many of our best practices in healthcare remain approximations:

extrapolating information from large data pools and applying it to
individuals. In many ways, we are still using trial-and-error
techniques—more sophisticated, certainly, but hardly treatment
tailored to each specific individual. Quantum computing’s step-
change capabilities hold the promise of eventually creating
personalized medicine, matching therapeutics to an individual’s
genome (see case study, “IBM and Cleveland Clinic”).

“This will be the Quantum Decade if we can apply quantum

IBM Chairman and CEO Arvind Krishna standing
next to the interior of a quantum computer at IBM’s
computing to discover one thing, heretofore unimaginable,
facility in Poughkeepsie, New York, home to IBM’s that progresses our line of inquiry into the future.”
first Quantum Computation Center.

Todd Hughes
Technical Director, Strategic Projects and Initiatives
CACI

29
 “The materials discovery process is unbearably
slow. Companies don’t have time to experiment
endlessly. Quantum computing can give us an
exponential leap in discovery.”

Doug Kushnerick
formerly with Technology Scouting and Ventures
ExxonMobil Research

This dream can become a reality by supercharging how experimenta-

tion is done. You may recall learning about the basics of the scientific
method as a child: a sequence that runs from observation, to question,
hypothesis, experiment, results, and finally, conclusion. With classical
Study computing, we’ve been able to speed up that process. The triad of
classical, AI, and quantum computing can supercharge the scientific
Extract, integrate, and
reason with knowledge method (see Figure 7).
at scale
The unprecedented ability to model complex systems will accelerate
Question Hypothesize the ability to extract, integrate, and validate so that we can draw
Tools help identify Generative models conclusions. We are already using AI to generate hypotheses automat-
new questions automatically propose ically and using robotic labs to automate physical experimentation.
based on needs new hypotheses that The greater ability of quantum computing will expand the possibilities
and gaps in expand the discovery
that can be evaluated before moving to physical experimentation, and
knowledge space
Accelerated accelerate the entire discovery process as a result. “For the first time,
scientific
method the loop in the scientific method is closing,” as the 2021 Science and
Report Technology Outlook from IBM Research puts it. “Each breakthrough
Test is a step toward realizing the dream of discovery as a self-propelled,
Machine
representation of Robotic labs automate continuous, and never-ending process.24
knowledge leads experimentation and
to new hypotheses bridge digital models
By accelerating discovery and more rapidly translating knowledge into
and questions and physical testing
practice, all kinds of new leaps will be possible. Healthcare is only one
Assess area of application. Another scenario: quantum computing can be put
Pattern and anomaly to work on finding new materials. These capabilities may improve the
detection is integrated efficiency of solar panels, wind turbines, and battery life. As we will
with simulation and explore in the Industry guides on page 91, the applications to specific
experimentation to
industries are myriad.
extract new insights

FIGURE 7

Scaling the scientific method

From questions to
hypotheses to reports

30
The discovery-driven
enterprise

In organizational terms, what will emerge from the Quantum

Decade is a new kind of discovery-driven enterprise (see Figure 8).
Just as cloud has increasingly virtualized the traditional enterprise,
the injection of quantum will open new possibilities. Analysis Discovery

The computing triad will revolutionize how businesses manage and

operate market-making business platforms enabled by intelligent
— or AI-driven — workflows. By examining how people work, AI can
Discovery-driven
already help determine the most efficient or effective workflows.

Cloud workload complexity

Tasks can then be routed to traditional or quantum systems — one
or more quantum computers working with a classical computing
system — depending upon which is the best option. Once information
technologists establish a workflow, a user need not know where or AI-
how the computation is being done. No specialized knowledge of Data-driven driven
quantum computing would be required.

Just a decade ago, those who appreciated the potential of AI —

and took steps to prepare for it and implement what they could Time Today
along the way — are now the outperformers.25 Today, we are in the
Quantum Decade, and as we accelerate the pace of discovery,
enterprises of all kinds need to pay close attention. Enterprise characteristics
Business Intelligent Scientific
intelligence, workflow, method at scale,
consumer-led enterprise-led external and
innovation innovation internal data

Enabling technologies
Network computing, AI and automation, Complex hybrid
consumer-facing mission-critical cloud workflows
FIGURE 8 apps on workflows on cloud
public cloud
A new normal
The emerging
discovery-driven enterprise

31
32
 Questions
to ask

1 3
Question One Question Three

How would your team, How are you educating

your executives, and yourself and your key
your board define the talent on quantum
case for quantum computing possibiities?
computing?

2 4
Question Two Question Four

What steps are you taking What are some viable

to become—or compete ecosystems through
with—a discovery-driven which you can access
enterprise that includes powerful, scalable
quantum computing? quantum computing
capabilities on the cloud?

33
 Insights

The power of The hidden Don’t go

quantum literacy workflow opportunity it alone

You can develop partnerships Getting more value from The speed at which quantum
and join ecosystems for “deep quantum computing requires computing is improving and
tech” quantum know-how. What examining workflows for quan- expanding makes it difficult for
you do need on your team is tum computing opportunities many companies to keep up.
literacy in quantum computing and modes of interaction Being part of a quantum computing
potential — a fluency that can with classical systems. But ecosystem can provide access to
help you conduct experiments readiness will take more than technology and talent that might
and scope out the advantages quantum computing literacy not be accessible otherwise.
for your organization. and experimentation. It requires
preparing your classical enter-
prise to integrate quantum
computing deeply into new
ways of working and new
business models.

34
 Chapter Two

Quantum readiness
and the power of
experimentation

“There is no doubt that quantum computing technology will be ready for

business this decade. There will be multiple million-qubit quantum
machines by 2030,” says Christian Weedbrook, CEO of Xanadu Quantum
Technologies. “The question is, are you ready?”

The short answer is, “maybe — if you act now.” Quantum computing readiness is a continuously evolving
state that depends on your general approach to, and investment in, innovation, as well as new talent
and skills, and overall digital maturity. This readiness includes your adoption of enabling technologies
such as automation, AI, and hybrid cloud; your willingness to analyze, experiment, and iterate with
evolving computing capabilities; the sophistication of your workflows; and your organizational skillset.

Your industry and location factor in as well. Industries fluctuate in their quantum computing readiness
based on competitive pressure and concentration, growth and innovation requirements, and quantum
computing’s potential for solving industry-specific computational problems. Countries and regions can
vary by geographical context, mainly with respect to investment, education and skills, regulation, and
ecosystem availability. And ecosystems themselves must achieve readiness to provide viable support.
But still, partnering with the optimal ecosystem can be an astute way to alleviate fluctuations in readi-
ness, regardless of your location or industry.

Think of it like this: Getting a head start in a technology such as quantum computing is analogous to the
power of compounded interest. Waiting a couple of years and letting early adopters pull away can
give them an exponential lead.

35
 Experiments by design:
Applying quantum literacy
to real problems

Encouraging news: You don’t need on-staff Ph.D.s in quantum computing to get
started. Yes, the world of qubits, superposition, and entanglement can be a slippery
slope best left to quantum experts, and it does take Ph.D.-level proficiency to create
novel intellectual property. But by developing partnerships and joining ecosystems
for “deep tech” quantum computing know-how, that can be surmountable. What you
do need on your team is literacy in quantum computing potential — a fluency that can
help scope out the advantages for your organization.

The exciting — and challenging — part is applying that literacy to business problems.
What are the current limitations in your industry? Dig deeper. What limitations are
causing those limitations? How would dissolving these seemingly intractable barriers
reshape your industry? Where are the stumbling blocks in how you mobilize computing
and design workflows today? Where are your industry and organization headed in
10 years?

Complex real-world problems may not be solvable until we progress toward fault-
tolerant quantum computing — the Quantum Decade’s culmination. This is a class of
quantum computing where you can run general-purpose quantum programs compiled
across both quantum and classical resources. Fault-tolerant computers incorporate
procedures that help prevent errors from multiplying and spreading, allowing them to
run quantum circuits arbitrarily close to correct even when their physical components
are faulty.

We are already learning how quantum computing can contribute to our understanding
of problems — big problems, at that. It’s helping researchers explore the development of
new materials. Over time, it can contribute to developing earth-friendly, efficient fertilizers
to support the global food supply chain. On a genuinely cosmic level, it could be a key
player in investigating the mysteries of how our universe is stitched together.26

“Executives need to understand what quantum

computing can solve in the next decade. They
need to look across the stack, evaluate the cost,
and determine the advantage.”

Jeff Nichols
Associate Laboratory Director
Oak Ridge National Laboratory

36
 “It’s not just decomposing, but
rethinking and recomposing
problems for quantum computers.”

Christopher Savoie
Founder and CEO
Zapata Computing

But let’s think shorter term. To achieve quantum readiness, — The benchmarking framework approach. Both classical and quan-
you need to define the art of the possible now through problem tum computing are far from static. They’re improving and evolving
scoping, experimentation, and iteration. This can involve one — constantly, especially quantum computing. Experiments can bench-
or a combination — of several approaches used independently mark problems against classical and quantum capabilities at one
or together (see Figure 9). time and then re-run them against improved hardware, software,
algorithms, error correction capabilities, and so forth. Isolating
— The pyramid approach. Industry-essential problems, by their and identifying those specific quantum computing improvements
nature, are complex. This approach involves experimenting and and strategically applying them to broader problem sets can help
learning in an iterative way, using classical decomposition and advance quantum readiness and the path to Quantum Advantage.
heuristic techniques to deliver an abundance of potential solutions.
Then, quantum processes identify a subset of optimal solutions The potential for quantum computing is tremendous, even if the
that rise, in this analogy, to the top of the pyramid. In other words, concepts themselves are esoteric. But experimenting and iterating
classical approaches can provide a good set of solution options, with quantum computing can demonstrate the power of conceptual-
then quantum systems can optimize. This enables refining larger izing outside the box (see case study, “IBM Services Supply Chain” on
solution sets and transcending smaller, theoretical options that page 38). As you evaluate scenarios and develop experiments for your
are not of any robust consequence. industry, creating a tangible roadmap for quantum readiness can bring
the esoteric very much down to earth. What’s critical is experiment-
— The analyze-and-extract approach. Solving a complex problem ing with state-of-the-art quantum computing hardware, most likely
in its entirety could require a million qubits. For now, the strategy through an ecosystem.
needs to involve extracting the parts that are solvable with classical
computing and reserving the other segments for quantum computing
and its extreme computational power. It’s like a dissection. The
problem undergoes analysis at various stages: preparation, decon-
ent | Le
struction, then resolving each deconstructed part. erim arn
xp
|E
n
sio

For now, this usually shakes out to align classical computation

Envi

Readiness over time

with data understanding, decomposition, and the computation it
can handle; quantum capabilities align with specialized computation. ent | Le 9
erim FIGURE arn
xp
Additionally, this process of deconstructing and reconstructing the erim
ent | Le |E
xp arn
|E Envision, experiment, learn
n
sio

problem in different ways helps to see it differently — perspectives Experimental approaches for
Envi
n
sio

that can ascertain even greater eventual value from quantum

Envi

applied learning
computing.

FIGURE 9

Envision, experiment, learn Increase of quantum capabilities

Experimental approaches
for applied learning

37
 IBM Services Supply Chain
A quantum-fueled search
for more accurate
demand forecasting 27

Predicting the future — is it possible? Across industries, organizations give it their best shot in
multitudes of areas: demand forecasting, inventory forecasting, capacity forecasting, and more.

But classical computing forecasting techniques can suffer from low accuracy. As an example,
for demand forecasting, the challenge of aligning supply chains with quickly changing demand
is daunting. Even consistent forecast improvements of just 1% can have a significant financial
impact. In services, there is a larger component of independent demand driven by variable
failure characteristics. With that in mind, IBM researchers are preparing a demonstration that
pairs quantum and classical computing techniques to make demand forecasting more efficient.

To that end, researchers are working with IBM Services Supply Chain (SSC), an organization
responsible for servicing data centers by storing and delivering field-replaceable service parts.
IBM SSC’s millions of dollars of inventory encompass more than 2,000 different parts housed in
114 warehouses located around the US. Depending on the severity of the issue, delivery needs to
occur within one of four specific timing windows: two hours, four hours, one day, or two days. As a
result, IBM SSC’s forecasting challenge is to predict how many parts are needed when and where.

The researchers used a two-step approach to the scenario. The first was to apply demand pattern
classification with example patterns that include:

Fast Slow Inactive Rare

Demand is Demand is Demand becomes Few orders or

continuous intermittent, with inactive one-time order
time periods that
have zero demand

38
 Then, the researchers executed the appropriate forecasting algorithm for the demand pattern.
Both classification and forecasting could be done using a combination of classical and quantum
(see figure below). Classical and quantum computing work together as a team, with quantum
doing the computational heavy lifting part of the workflow.

Quantum machine learning models have the potential for greater generalizability, which
means forecasting algorithms could achieve greater accuracy with new data. While classical
computing can complete these workflows without quantum computing, as the researchers
refine their techniques, they’re getting closer to understanding the role quantum computing
can play. This is going to be essential in areas such as predictive maintenance, in which IoT
sensors are increasingly a source of data. And for safety-related maintenance, such as airplane
parts, the increased performance and accuracy of quantum machine learning models could
become a necessity.

As with many quantum computing experiments, this classification and forecasting work is
both foundational and evolving, providing IBM researchers the platform to explore quantum
algorithms and capabilities for business forecasting. Upon completion, researchers will have a
tangible demonstration that maps a business problem to quantum computing. And it will help
to illustrate a critical point: Classical and quantum computing are not competitors. Rather,
they are complementary technologies that, together, can be more effective.

Combining classical
and quantum
The forecasting workflow

Quantum activity

Data
engineering Classification Forecasting

Data Feature Quantum Support Demand Quantum Support Forecast

extraction kernel vector pattern kernel vector
classification classification regression

39
 Quantum-fueled
process workflows

Thinking small and incrementally can be an expeditious route to Quantum

Advantage, especially when integrating quantum computing into your workflows.

A workflow is essentially a tree of tasks, with functionalities spanning adaptive

customer and vendor interactions, proactive executive decision support, targeted
employee training, and other AI applications.28 However, workflows can encounter
difficulty in comprehensively computing large amounts of complex data in a timely
manner. As a result, businesses may be forced to employ computed approximations
even in the face of pressing market demands. Examples could include workflows
involving complex networks such as distribution, transportation, communications,
or logistics.

Applications of quantum computing are almost always in terms of accelerating a

process or sub-process within a workflow. Getting more value from quantum computing
requires examining workflows for quantum computing opportunities and modes of
interaction with classical systems (see case study, “OLED screens” on page 42).

Evaluating quantum computing in this way requires a broad focus on industry trans-
formation. How can quantum computing partner with classical computing within a
particular context? What workflow subsections are best suited for quantum computing?
The intellectual analysis required in assessing workflows for classical versus quantum
computing can result in a fresh perspective on the workflow itself — as can the potential
range of results that quantum computing provides. Quantum computing can be conducive
to computation that generates unexpected breakthroughs — yielding new efficiencies,
sharper methodologies, and more meaningful modes of engagement with both internal
and external stakeholders.

“Quantum computers won’t cannabilize classical “We need to spend more time on what part of the workflow
computers. Quantum computers will help with quantum computing can address. Not mysterious physics,
certain difficult optimizations that exist in work- but the mission and business problems that it can solve in
flows. It will be additive.” a transformative manner.”

Christopher Savoie Glenn Kurowski

Founder and CEO Senior Vice President and Chief Technology Officer
Zapata Computing CACI

40
41
 OLED screens
Brighter, more efficient
displays through
quantum-driven simulation 29

What’s the one thing that comes between humans and their phones? The screens, also known
as flat panel displays. But these displays are one of the highest power-consuming components
in smartphones, often limiting battery lifetimes.

New, advanced materials can produce brighter displays that are more efficient and less power
hungry. But developing these new materials requires labor- and time-consuming traditional lab
research methods. The process spans several development stages, including material identification,
process development, device prototyping, and qualification testing.

Traditionally, progress in this realm has been slow. For organic light-emitting diode (OLED)
displays, 34 years passed from the first reported observance of electroluminescence in an organic
molecule (1963) to the first OLED display commercially available on the market (1997).30

But quantum computers can contribute to a brisker pace. Quantum computing can help commercial-
ize new materials with faster, more accurate molecular modeling of both the materials as well as their
interactions with manufacturing processes and operating conditions. These new materials can produce
brighter, lower-power, lower-cost displays that may expedite their commercialization, enabling compa-
nies to offer more compelling, more competitive products sooner.

Materials simulation with classical computing currently has limited application in the development
of new materials. The time required to accurately simulate molecular scenarios of sufficient complexity
quickly expands beyond practical time frames. As a result, without accurate computer simulations,
laborious and costly experimental methods must be employed.

With the quantum computing approach, quantum simulations can be used across the workflow to
more realistically simulate materials and their interactions with device operation, manufacturing
processes, and the operating conditions. More complex and more accurate molecular-level materials
simulations can enable productive experimentation on the computer, reducing costly, cumbersome
lab research and manufacturing development.

These quantum computing-driven material simulation workflows can create strategic, competitive
product advantages such as brighter, lower-power displays. And the potential financial rewards are
considerable. Just a 1% revenue increase per year could mean an additional $320 million for the
OLED display market.31

42
43
 The intelligent workflow:
Adding the power of quantum

At IBM, we define intelligent workflows as extended end-to-end systems that, through the application
of technology at scale, define the customer experience and influence economic results.32 These workflows
are more expansive than simple processes and traditionally have used technologies such as automation,
blockchain, AI, 5G, cloud, and edge computing to contribute to exceptional outcomes. IBM research shows
that using these classical computing technologies in workflows can triple the benefits.33 Incorporating
the power of quantum computing has the potential to improve on that exponentially (see Figure 10).

In fact, we’re approaching a revolution that’s driving computing toward highly heterogeneous environ-
ments. Increasingly, classical, AI, and quantum computing will be integrated into intelligent workflows
managed on a hybrid cloud.

As you evaluate quantum computing in the context of intelligent workflows, here’s an analogy. Processes
function as an organizational backbone. But intelligent workflows serve as the organization’s nervous
system — in short, they’re interconnected and interdependent. These workflows differ from simple
processes because they extract information from the ecosystem, sense and determine the appropriate
response, and send feedback to other workflows.34 Quantum computing, with its ability to evaluate many
options, excels here.

Intelligent workflows are creatively crafted models with a fresh approach to both data and innovative
technology. Establishing these workflows — and enhancing the requisite AI, data, and cloud capabilities
— can benefit your business now, while you’re laying the groundwork for quantum (see Perspective,
“Intelligent workflows” on page 46). Other considerations include the reality of quantum computing
breaking Rivest-Shamir-Adleman (RSA) and elliptic curve cryptography (ECC) encryption, and the need
to migrate to existing quantum-safe cryptography.35

FIGURE 10

The booster shot

Intelligent workflows powered
by quantum computing

Ecosystems

AI IoT

Market Outcomes
Extended intelligent workflow

Blockchain Quantum Automation

computing

44
 “Process workflows alone miss the complexity of real-world
work. Quantum computing will change the relationship
among people, technology, and work.”

Colonel (Retired) Stoney Trent, Ph.D.

Founder and President
The Bulls Run Group

By their very definition, intelligent workflows are inherently based

on a mix of technologies — and that mix can and should include
quantum computing. Intelligent workflows thrive in an open, loosely
coupled architecture, for starters, that connects applications and
technical approaches. Their ability to leverage hybrid environments
is critical, given most organizations are accessing quantum comput-
ing on the cloud versus developing the infrastructure themselves.
Even if your organization uses a more simplified process approach,
establishing some foundational intelligent workflows can be an
excellent segue into quantum computing.

In the intelligent workflow framework, quantum computing may

be intuitively thought of as an accelerator at first — a booster tech-
nology to supplement classical computing where extra power is
needed. But in reality, quantum computing is a catalyst for deep
industry business model revolutions that can spawn disruptive
services and modes of consumption.

For these revolutions to happen, enterprises need to develop a

strategic compass that guides them toward optimal opportunities.
They also need to shore up the ability to apply quantum computing
within classical business environments from technology, process,
and people perspectives. In short, enterprises need to establish
a quantum-receptive infrastructure — and when the technology
fully comes to fruition, they’ll be ready.

IBM Senior Vice President and Director of Research

Darío Gil holding the 433-qubit IBM Osprey chip

“It would be very strange if any major cloud platform in 2030

does not have a quantum play. Quantum is going to be more
impactful than AI or supercomputers.”

Christian Weedbrook
CEO
Xanadu Quantum Technologies

45
 Perspective
Intelligent workflows as
a foundation for quantum
computing acceleration 36

Developing intelligent workflows can help you prepare for quantum

computing — and their business-enhancing properties can create
organizational benefits now. The four steps below outline a broad
framework for incorporating emerging technologies, curating data,
and embracing a hybrid cloud environment. With that infrastructure
in place, organizations can progress to analyzing sub-workflows for
quantum computing acceleration opportunities.

1 2 3 4
Embed emerging Drive value Deploy through Evaluate sub-workflows
technologies, including AI from data. hybrid cloud. best suited to quantum
and machine learning, to computing acceleration.
change ways of working.

Apply other emerging technol- Leverage curated data across Use the journey to a hybrid Join an open-source quantum
ogies to build highly dynamic intelligent workflows to mine cloud to access data and put computing ecosystem. Such a
and intelligent workflows that the most important value it to new use, house intelligent community provides access
radically change how work pools. Establish robust gover- workflows, and modernize to quantum computing on a
gets done and new experiences nance to engender trust in applications in an open manageable scale, providing a
are designed. In particular, your data and AI models so and de-risked manner. Use low-commitment “laboratory”
strengthen AI and machine decisions can be pushed out this flexibility to seek out for experimentation. Classical
learning capabilities, which to the front lines of the organi- opportunities for experimenting and quantum computing usage
partner exceptionally well zation. Identify sub-workflow with cloud-based quantum should be choreographed for
with quantum computing. components of exceptional computing. quantum computing to most
complexity that would benefit effectively augment classical
from quantum algorithms. functions.

46
 To get to this point requires key capabilities (see Figure 11). None of them are about mastering quantum
technology itself. Rather, they’re about enhancing enterprise skills, technical capabilities, and forward-
looking strategies that will enable the quantum computing revolution to take root and thrive.

The good news: Taking a pragmatic, agile, and iterative approach to quantum computing now isn’t just
about reaping future rewards. This strategy can start to deliver significant business benefits today.
For example, setting up a modern dynamic delivery model and open innovation platform through a
hybrid cloud can yield its own significant returns in your classical enterprise.37 In parallel, they advance
your ability to seamlessly integrate quantum computing when it is production-ready.

By enhancing your classical computing environment now while also investing in experimentation and
quantum-ready workflows, you are better positioned to accelerate your path to Quantum Advantage.

FIGURE 11

On solid ground Strategy Technology Operations

Laying the foundation for
quantum computing

Ability to convert quantum DevSecOps framework Governance and oversight

computing market information to build, test, deploy, and to help ensure successful
into actionable insights on update quantum computing execution of the quantum
opportunities and threats applications computing roadmap

Proficiency to capture AI and other advanced Talent strategy and

business value from computational model culture to build a
quantum-triggered maturity for supporting high performing team
strategies, capabilities, quantum computing-
and innovation initiatives addressable workflows Innovation processes that
create a quantum-enabled
Expertise to secure and Hybrid cloud architecture solution that meets
protect intellectual property that enables orchestration business needs
(IP) or quantum computing and interoperation of
technologies quantum-classical workloads Agile practices that result
in high velocity of R&D and
Influence of regulations and iterative solution design
standards related to intended
use of quantum computing

47
 The quantum computing
ecosystem talent track

In this global, complex economy, no business can do everything Keeping the following questions in mind can help effectively align
itself. We rely on partners, specific expertise, and ecosystems to ecosystems with talent needs.38
leverage the best of what is available — and to exploit and demon-
strate our own differentiating value-add. What is your type of business problem?
You may not yet possess the expertise to explain your issue in
The speed at which quantum computing is improving and expand- terms of quantum capabilities, but you undoubtedly have a broader-
ing makes it difficult for many companies to keep up, and the cost brush perspective. Is your problem a simulation problem based in
of “going it alone” could be prohibitive. Being part of a quantum chemistry? Or are you looking for quantum algorithms that enhance
computing ecosystem can provide access to that technology when machine learning? Maybe your primary concern is security in the
it might not be possible otherwise. And these ecosystems also quantum era? Prospective ecosystems are most effective when
provide a window into better understanding quantum computing’s they’re already working on use cases relevant to your specific issue
implications and how they relate to your business issues. and include experts who understand your industry problems.

Determining exactly what those business problems are, and how Who are the world’s leading organizations and thinkers related
quantum can play, requires expertise. Organizations can strive to to quantum computing and your business issues?
build their own in-house quantum computing team, and to an extent Because of the rapid pace of quantum computing innovation, you
that could be necessary. But ecosystems provide valuable supple- need partners who are at the forefront of scientific breakthroughs
mentation — or even substitution — for in-house quantum computing and their application to business problem-solving (see Figure 12).
talent, especially of the deeply technical sort. The difference between partnering with Tier 1 and Tier 2 players
could mean the difference between being part of a “winner-takes-
Due to limited availability, attempts to build or bring quantum com- all” competitive scenario or being left behind.
puting skills in-house are very challenging. But the most advanced
ecosystems are already stockpiling talent.

“At this point, partnering for quantum skills makes

much more sense than acquiring them.”

Doug Kushnerick
formerly with Technology Scouting and Ventures
ExxonMobil Research

48
 “I’m managing intellectual capital that’s
not even formed yet.”

Irfan Siddiqi
Director of the Quantum Systems Accelerator
Department of Energy (DoE)
National Quantum Information Science (QIS) Research Center

What is the optimal mix of consultants versus in-house staff?

The right quantum computing ecosystem for you contains the Your organization
right mix of ecosystem participants concentrating on your
business problems alongside your industry and technical
professionals, including:

— A quantum computing technology provider that offers easy

access to cloud-based quantum computing systems, an open-
source programming framework, educational resources such
Application
as tutorials and research papers, quantum computing researchers, developers
quantum computing consultants, technical support, and a
collaborative community actively engaged in addressing quantum
computing challenges.
Universities

— Quantum computing developers who understand quantum

computing application development using open-source code
and access to application development libraries, and have
access to real quantum computing hardware. Start-ups with
supporting
technologies
— Academic partners and universities conducting relevant quantum
computing research and developing budding quantum computing
experts that you may ultimately hire onto your team. Research labs

Organizations with
similar challenges

Technology infrastructure
provider

FIGURE 12

Where are your superpowers?

Assembling the right mix
of ecosystem constituents

49
 “If anything slows down the Quantum Decade, it’s unlikely to be
the technology. It will be the talent. There’s access to capital,
a lot of interest, and we will have the technology. It’s the people
that we need.”

Prineha Narang
Assistant Professor of Computational Materials Science
Harvard University

If developing at least some in-house talent is a priority, a first step

Quantum stack components Skills required
can involve seeking out community platforms. These “hands-on”
ecosystems give developers access to tools to create and run quantum
Technical services General technology
expertise computing algorithms on actual quantum computing hardware. For
example, the IBM quantum computing community offers the open-
source Qiskit framework. Such platforms are open to both students —
Applications Application architecture
a critical constituency — and organizational IT teams.
and development

A less “deep tech” option is to form small teams to start identifying

Use case-specific Industry/domain problems — whether industry-changing breakthroughs or workflow
libraries knowledge accelerators — in which quantum computing can play a role. Team
members don’t need Ph.D.-level quantum computing expertise, but
Performance libraries Quantum computing they do need enough quantum computing literacy to assess quantum
system algorithms computing capabilities against industry and organizational needs
(see Figure 13).
Compilers and Advanced math, quantum
optimizers computing system expertise When you’re hiring for quantum computing, what’s the optimal talent?
Researchers from the Rochester Institute of Technology and the
University of Colorado Boulder provided some interesting insights.
Assembly language Quantum physics, quantum
and drivers computing system expertise They interviewed managers at more than 20 quantum tech companies
based in the US, and the responses yielded two common paths.

Quantum computing Quantum physics,

FIGURE 13
hardware chemistry, engineering
Stacked for success
What components and skills
can help you achieve quantum
computing literacy?

“The semiconductor industry and quantum computing in the US

face challenges acquiring STEM graduates—first from having to
compete for engineers with more well-known software and social
media companies, and second from having a shrinking pool of
STEM graduates compared to other countries over the past 30 years.”

Ajit Manocha
President and CEO
SEMI

50
First, the organizations said they were seeking candi-
dates who were quantum “aware.” This encompassed
a broad understanding of quantum computing concepts
and the ability to discuss and apply those concepts—
what we call quantum literacy. The prospects didn’t
necessarily need an in-depth knowledge of equations
and theory.39 Our IBM experts point out that this quan-
tum literacy can often be a re-skill, a case of learning
enough quantum computing to augment domain
expertise and figure out how to integrate quantum
computing in that area.40

Second, candidates who had hands-on lab skills were

favored over those with none.41 In a 2021 interview,
one IBM industry expert estimated only 3,000 skilled
quantum workers existed, and that base needed to
double or triple.42 Other research suggests that by
2025, less than 50 percent of quantum computing jobs
will be filled unless significant interventions occur.43

Acquiring this level of deeply technical skill can be

challenging, especially when competing against univer-
sities, start-ups, and vendors. This “talent drought”
can boost the appeal of up-and-running ecosystems
with their own talented quantum teams.

51
 Quantum-ready What do QROs have
in common?

organizations 44

To find out, we surveyed

565
Quantum-ready organizations (QROs)
rank in the top 10% for their readiness
across quantum strategy, operations, and
technology. In contrast, the least ready CXOs
organizations comprise the bottom 10%.

across

15
countries

and

13
industries

with primary responsibility

for technology and
innovation strategy

52
 QROs use ecosystems as QROs have a greater grasp
a catalyst for readiness. of the skills gap.

Compared to the least-ready

organizations, QROs are:
% of QROs are focused
on a single quantum
computing system
nearly 5x more effective at
developing internal quantum skills

QROs participate in quantum

ecosystems to access nearly 2x more effective at
attracting STEM talent

over 2x more effective at

71%
partnering with academic institutions
use cases
63% 66%
hardware educational programs

1.5x more effective at

partnering with research labs

Simulation Algebraic problems

is the most heavily have the highest
funded use case area use case activity nearly 3x more effective at
internship programs

of the technology workforce

38% 63% % is expected to expand skills
to gain quantum expertise
over the next 3 years

53
QROs are technology innovators. QROs spend wisely.

9 in 10 QROs outperform their peers in agility 8 in 10 QROs outperform their peers in

efficiency and profitability

7 in 10 QROs outperform their peers in innovation

QROs are nearly

Quantum-ready organizations 5x more

run 48% more AI workloads efficient
48% more
in production than their
least-ready counterparts. in their
quantum spend

Cloud investments at 55% of quantum investment

the start of this decade by QROs is directed toward
have a high impact on research and experimentation,
their readiness. Today, 28% ecosystem participation, and 55%
QROs run 28% of their workflow re-design.
workloads on hybrid cloud.

54
 IBM Quantum System Two is designed to be the building block of quantum-
centric supercomputing. IBM Quantum System Two employs a modular
architecture allowing multiple systems to be connected together to create
greater computational capacity. Quantum communication can also be
employed to further increase computational capacity, along with hybrid cloud
middleware to seamlessly integrate quantum and classical workflows.

55
56
 Questions
to ask

1 3
Question One Question Three

How can dissolving Intelligent workflows that

seemingly intractable use technologies such as
barriers reshape your automation, blockchain,
industry? AI, 5G, cloud, and edge
create an ideal environment
What types of quantum for quantum computing to

2 4
computing experiments plug into.
could you be conducting
now, in pursuit of those How can establishing this
goals? foundation benefit your
business now?

Question Two Question Four

How can quantum What steps can you

computing partner with take to foster quantum
classical computing within computing literacy within
a particular workflow? your organization?

Which workflow subsections What ecosystems can

are best suited for quantum you partner with for
computing? “deep tech” quantum
computing expertise?
How does this assessment
alter perspectives and
possibilities related to
your processes?

57
 Insights

A process, Three classes of The quantum computing

not a destination problems at which “prioritization matrix”
quantum excels

When quantum demonstrates Quantum computing is especially Evaluating the potential business
its superiority over traditional astute at simulations of nature; impact of quantum computing
computing for a specific algebraic problems, including applications can be challenging.
problem, that’s Quantum machine learning, differential We show you how to evaluate
Advantage. It’s gradual, coming equations, and dealing with which potential quantum computing
in waves that both progress and matrices; and quantum search- applications are better positioned
pause, but ultimately move the and-graph problems. to deliver optimum business
technology forward. benefits.

58
 Chapter Three

Quantum Advantage
and the quest for
business value

Quantum Advantage — as introduced on page 6 — occurs when a computing task

of interest to business or science can be performed more efficiently, more cost
effectively, or with better quality using quantum computers. This is the point
where quantum computers plus classical systems can do significantly better
than classical systems alone.

But Quantum Advantage is not a dramatic, all-at-once event. It will be more ambiguous, coming in waves
that both progress and pause, but ultimately move the technology toward achieving concrete business
value. Each use case has its own unique timeline for Quantum Advantage. The particular quantum com-
puting system or ecosystem partner you’re engaging can influence that timeline and advantage as well.
Fortunately, Quantum Advantage can benefit from a domino effect in which successes in one use case
can cascade to others.

“Exponential acceleration can occur after an initial use case.

What we learn from those early use cases can be applied to others.”

Sabrina Maniscalco
Professor of Quantum Information and Logic, University of Helsinki
CEO, Algorithmiq Oy

59
 As we evaluate the time it will take to attain Quantum Advantage, it’s
helpful to understand a bit about the current systems and where
we are heading. Today’s qubits are subject to errors from hardware
limitations and “noise” from the surrounding environment. If super-
conducting qubits — which live at a temperature close to absolute
Classical
zero — aren’t protected from noise by keeping them in a vacuum,
computer
vibrations or stray photons hitting the device could ruin a compu-
tation. The same goes for heat and ambient effects. Remember,
quantum computing is built on the physics of quantum mechanics,
and that is the model for interactions at the atomic, electron, and
photon level. Coupling to the environment could disturb what we
are doing in our system.

Quantum error
More precisely, qubits in quantum hardware are called physical qubits.
correction
Currently, quantum computing use cases are enabled by the types
of algorithms available to us, but we are limited to implementing
them using noisy physical qubits. While we expect it may be possi-
Quantum error ble to reach the earliest Quantum Advantage examples with physi-
mitigation cal qubits, we will need to move to logical qubits to achieve quantum
computing’s full value. Logical qubits are created by combining soft-
Runtime

ware with hundreds of physical qubits to implement error correction.

With this type of qubit, errors coming from noise affecting the under-
Quantum circuit complexity lying hardware can be both detected and corrected. Implementing
quantum error correction is a crucial goal for this decade.

Indeed, it is widely accepted that fault-tolerant quantum proces-

sors need to be built before any quantum algorithms with proven
super-polynomial speed-up can be implemented. However, recent
FIGURE 14
advances in techniques we refer to broadly as quantum error
On the road to fault tolerance mitigation can create a smoother, continuous path toward this goal.
Quantum error mitigation Along this path, advances in qubit coherence, gate fidelities, and
as a stopgap strategy
speed translate to measurable advantage in computation, akin to
the steady progress historically observed with classical computers.
In Figure 14, we chart quantum runtime as a function of quantum
circuit complexity for classical computers, quantum computers
with error correction, and quantum computers with error mitiga-
tion. Quantum error mitigation can fill the gap before quantum
error correction achieves practical runtime reductions.

60
In recent years, two general-purpose error mitigation methods—zero noise extrapolation (ZNE) and
probabilistic error cancellation (PEC) — have allowed us to evaluate accurate expectation values from
noisy, shallow-depth quantum circuits, even before the introduction of fault tolerance.

The ZNE method cancels subsequent orders of the noise affecting the expectation value of a noisy
quantum circuit by extrapolating measurement outcomes at different noise strength.45

PEC can already enable noise-free estimators of quantum circuits on noisy quantum computers, as
evidenced by theoretical and experimental advances.46 These advances then translate into larger
circuit volumes that can be run on the noisy hardware while still producing superior expectation values.

These ideas have progressed beyond mere theory. In June 2023, IBM Quantum and UC Berkeley
demonstrated that noisy quantum computers could beat expectations and deliver value sooner,
thanks to advances in IBM Quantum hardware and these new error mitigation methods.

The two organizations joined forces to determine if today’s noisy, error-prone quantum computers
could help calculate accurate results for specific kinds of problems. And the IBM researchers used IBM
Quantum processors to explore significant computations and realistic applications.

The researchers alternated running complex physical simulations on the 127-qubit IBM Quantum Eagle
processor, and UC Berkeley using state-of-the-art classical approximation methods on supercomputers
located at Lawrence Berkeley National Lab and Purdue University. Each method was checked against a
precise brute-force classical calculation.

As simulations grew more complicated, researchers observed how both computational systems —
quantum and classical — performed. Both teams were confident that the quantum computer returned
answers more accurate than classical methods, even when the simulations transcended brute-
force methods.

“In order for quantum computing to be an advantage, you have

to have confidence in and trust the results. Look at it this way.
If a quantum computer designed a parachute for you, would
you be willing to wear it and jump out of a plane?”

“For example, would three different quantum facilities come

up with the same answers, with similar error rates and answer
sets? It’s through consensus that you get confidence.”

Peter Tsahalis
CIO of Strategic Services
and Advanced Technology
Wells Fargo

61
 At this level of computing, everything is changing — fast. No one is claiming that today’s quantum com-
puters are consistently beating classical computers. In fact, other classical, specialized computers could
soon return correct answers on the very calculations that were tested. But consider this: the scientific
dance of quantum computers running a complex circuit and classical computers verifying the quantum
results benefits both classical and quantum. And, importantly, it reassures users about the utility of
near-term quantum computers.

The IBM Quantum Eagle processor has now successfully run some of the longest, most complex circuits
to date— delivering results that are accurate enough to be useful. And this research validates a compu-
tation model that is a core facet of algorithms designed for near-term quantum devices. The power of
these processes, combined with error mitigation techniques and IBM’s fleet of 100+ qubit processors,
will enable IBM Quantum users to explore applications on systems that can potentially outperform
today’s classical methods.47

The IBM Quantum-UC Berkeley research underscores an important question that will reverberate
through the Quantum Decade: As the results from quantum computing truly transcend those of classi-
cal, how do you evaluate them? They’re well past validation from traditional techniques and traditional
computers. When conducting theoretical research, the issue might not be as consequential. But in
scenarios that impact real-world health and safety, it’s a daunting question.

Out of necessity, we need to veer away from classical validation — it simply won’t keep up — to using
multiple “flavors” of quantum computing. This could mean benchmarking across different modes of
quantum computers themselves, or even different ecosystems. Validation and quantification of results
could ultimately elevate some systems over others in terms of reliability and accuracy. It’s yet another
factor that can influence waves of Quantum Advantage.

62
63
 At IBM, we see those waves aligning into three phases (see Figure 15).
Wave 1 Wave 2 Wave 3
— The first wave is low tide and low key. There may be murmurs in
Low tide High tide Tsunami some industry and academic research corners, but overall results are
not heavily publicized. Those with the foresight to experiment with
the technology may see value, followed by ways to improve, then
applications for other areas and new algorithms.

— The second wave is high tide. Breakthroughs are more structured

and commonplace. Conversations about quantum computing are
gaining currency. More organizations are aligning with ecosystems,
experimenting with cloud-based quantum computing services
environments, and test-driving quantum computing with increasing
success.

— The third wave? Here comes the tsunami. Much can change, and
industries are transformed. Quantum machine learning comes to the
forefront, and breakthroughs grow more complex and revolutionary.
This is where the Quantum Decade reaches a crescendo, with a
strong surge into error-corrected quantum computations.

Ultimately, the third wave confers Quantum Advantage to organizations,

Low-key murmurs Breakthroughs are Breakthroughs grow end users, and society overall. How can airplanes be manufactured
in some research more structured more complex with less corrosive metals — and fly more safely with less maintenance?
corners and commonplace and revolutionary How can the medical industry better personalize diagnoses, treatments,
and pharmaceuticals? (See case study, “IBM and Cleveland Clinic,” on
page 28.)

FIGURE 15

The three waves

From low tide to tsunami

64
 To put it in perspective, some experts believe that quantum computing
is where AI was in 2010. By virtue of the exponential nature of the tech-
nology, quantum computing has the potential to take off even faster.

However, it will take investments in carefully considered use cases to

reveal quantum computing “killer apps” by industry domain. To get
a grasp on evaluating quantum computing’s commercial potential
for your industry, we’ll jump into how quantum computing can help
specific classes of problems, and from there, a methodical approach to
prioritizing use cases. We’ve also included an extensive set of Industry
guides outlining industry-aligned use cases and scenarios on page 91 —
detailed guides to what quantum computing could mean for you.

Ultimately, Quantum Advantage comes down to results.

“In 10 years, we will have achieved what took 40 to 50 years “At the end of the day, executives need capabilities. They care
in classical computing. In the ’60s, ’70s, and ’80s, computer about the business answer. They’re agnostic as to how that gets
science was niche, almost a dark art. But by 2030, we will done, and that won't change. You don’t go to business leaders
have figured out how businesses can use quantum comput- with quantum solutions per se. You go to them with ways to
ing — with no in-depth knowledge of how it actually works.” better optimize their business.”

Ilyas Khan Christopher Savoie

Founder and CEO Founder and CEO
Cambridge Quantum Computing Zapata Computing

65
 Perspective
High Energy Physics
and new avenues toward
Quantum Advantage 48

High Energy Physics (HEP) explores what the world is composed of and how it operates, seeking
insights from the tiniest earthly particles to the outer realms of space.49 Needless to say, the field
abounds with difficult computational problems.

Yet these same challenges give HEP researchers an invaluable perspective in assessing quantum
computing’s potential—and driving Quantum Advantage. On the theoretical side, this community
explores model systems that are difficult or impossible to address with classical techniques. On
the experimental side, HEP faces tremendous data difficulties, such as the computational challenges
following the upgrade of the Large Hadron Collider, the world’s largest, most powerful particle
accelerator.50

In July 2023, in a significant milestone, CERN, the European Organization for Nuclear Research;
Deutsches Elektronen-Synchrotron (DESY); and IBM led the publication of a paper updating HEP
quantum computations, as well as outlining examples for theoretical and experimental benchmark
applications that could be addressed in the not-so-distant future.

The paper summarized the output from a working group, Quantum Computing for HEP (QC4HEP),
which was convened by the three organizations. QC4HEP gathered experts on HEP from academic and
research institutions across four continents. In addition to being world experts in HEP’s theoretical
and experimental aspects, these individuals are passionate about quantum computing.

QC4HEP investigated classes of problems and corresponding quantum algorithms that can lead to
Quantum Advantage with near-term, noisy, quantum devices, and specifically using IBM supercon-
ducting devices. The group’s goal: to deliver a set of physically relevant use cases that can evolve
into interesting demonstrations. This is underscored by IBM’s 100x100 challenge—in 2024, the
company plans to offer a tool capable of calculating unbiased observables of circuits with 100 qubits
and depth-100 gate operations in a reasonable runtime.51

66
The paper explores two main domain areas: theoretical methods and algorithms for modeling HEP
problems, and machine learning methods for the analysis of experimental results as well as detector
simulation and event generation.

A major emphasis is the investigation of how quantum computing can accelerate or improve different
steps of data analysis and data processing chains, identifying new avenues for Quantum Advantage.
Currently, most of the work in this domain is focused on the development and optimization of quantum
machine learning algorithms implemented either as quantum neural networks (variational algorithms)
or kernel methods.

However, evaluating the performance of machine learning algorithms on HEP data requires prudence:
realistic applications have requirements that today’s quantum devices cannot easily handle. The most
critical issue involves data sample size and complexity. The preferred approach today is hybrid: a
classical feature extraction and/or dimensionality reduction step is used to bring the classical input
to a size that can be realistically embedded on noisy, near-term quantum hardware.

In particular, trainable techniques allow an end-to-end optimization of the reduced data representation
(known as “latent representation”), their embedding in quantum states, and the quantum algorithm itself.

These steps have enabled the design and implementation of quantum algorithms for most of the
tasks in the typical data processing chain, albeit at a reduced scale. But the good news: access to the
100x100 quantum hardware, combined with data reduction techniques, is likely to bring current
prototypes to a much more realistic size.

67
 Quantum computing at its best:
Three classes of problems
52

What could the commercialization of quantum computing mean for

your organization? What types of problems are the best candidates
for Quantum Advantage?
Search
In the near-to-medium-term, quantum computing could confer
business benefits in three areas: simulation, search, and algebraic
problems (see Figure 16).

Quantum simulation of natural processes

Algebraic Because quantum mechanics describes how nature works at a
problems fundamental level, quantum computing is well-suited to model
processes and systems that occur in nature (see case study,
“IBM Researchers: Exploring the molecular simulation of water”).
Simulation

Simulation Algebraic problems Search

Chemistry Adaptive vendor/ Sampling
Pharmaceuticals customer interactions Travel and transportation
Materials Decision support Logistics/supply chain
Electric batteries Training Network infrastructure
Air traffic control
Work scheduling

FIGURE 16

Where the rubber meets the road

Anticipated uses of
quantum computing

68
IBM researchers
Exploring the molecular
simulation of water 53

The future is not quantum computing alone. Rather, it’s the convergence of quantum computing,
classical computing, and AI that has the power to transform. Combining classical and quantum
computations in nontrivial ways, trading off one for the other, can enhance the capabilities of any
one on its own and increase what is possible with the resources available.

The methods described here harnessed classical and quantum resources to capture quantum
correlations and double the size of the system that can be simulated on quantum hardware.

Exploiting the symmetries of the problem, IBM researchers developed a technique to split the
quantum circuits into smaller ones, capturing the most challenging aspects of the computation
and requiring only half as many qubits as the full circuit. This strategy allowed them to not only
reduce the number of qubits needed, but also to make the quantum circuits required shallower.
Each smaller circuit was run separately on a quantum computer and the outputs combined using
classical post-processing techniques.

The researchers tested this method in a molecular simulation of water. In this case, the parts of the
problems difficult to simulate could be reduced to 10 orbitals, or wave functions. These orbitals
could be represented on five qubits of an IBM Quantum processor to compute the ground state
energy of the molecule in the most accurate simulation to date.

Methods like this have the potential to scale by doing twice as much with the resources available,
trading off quantum and classical computations to expand the computational reach of the quantum
computing systems. This method can prove productive in materials discovery workflows.

69
 Search-and-graph problems Algebraic problems
The art of solving optimization problems involves searching for Algebraic problems include linear systems of equations, differential
the “best” or optimal solution in a situation where many possible equations needed for industry problems, problems relevant for machine
answers exist. Take the example of building a package delivery learning, and operations on matrices. Mathematical problems like some
schedule. Mathematically, more than 3.6 million possible combina- methods of machine learning and options pricing in finance involve
tions exist for scheduling 10 deliveries in adjacent time slots.54 But the mapping and evaluation of functions over a multidimensional
which schedule represents the optimal solution, given variables parameter space.
such as timing requirements of the recipients, potential delays,
and the shelf life of transported goods? Even when applying The state of qubits in a quantum computer is itself a complex high-
approximation techniques, the number of possibilities is still far dimensional space capable of exploring aspects of data inaccessible
too large for a classical computer to explore (see case study, to classical computers. In fact, a symbiosis between AI and quantum
“ExxonMobil”). computing is beginning to spawn a virtuous cycle of advancement in
both fields. For example, quantum algorithms can enhance machine
As a result, classical computers today take extensive shortcuts learning in the area of data clustering.55 But machine learning can be
to solve optimization problems of significant size. Unfortunately, used to better understand quantum systems.56 Other businesses that
their solutions are often suboptimal. Businesses that could could benefit in this area include consumer products and retail
benefit from quantum search-and-graph optimization include: companies tailoring marketing offers (see case study, “IBM Quantum
and University of California, Berkeley researchers” on page 73).
— Telecommunications companies upgrading their
network infrastructure
— Healthcare providers optimizing patient treatments
— Governments improving air traffic control
— Organizations developing employee work schedules
— Universities scheduling classes.

While no one has yet delivered a mathematical proof confirming

that quantum computing will confer an exponential speed-up for
search-and-graph problems, researchers are working on demon-
strating this heuristically. Forward-thinking companies are already
exploring solving optimization problems using quantum computing in
their quest to leap ahead of competitors. Their foresight may prove
warranted after the first demonstrations of Quantum Advantage in
optimization are confirmed.

70
ExxonMobil
Investigating the use of
quantum computing to help
optimize global journeys 57

How do you orchestrate tens of thousands of merchant ships traversing

the oceans to deliver the consumer goods we use in our daily lives?
Roughly 90% of world trade is dependent upon maritime shipping.
More than 50,000 ships, carrying as much as 20,000 containers each,
move around every day, transporting goods worth $14 trillion.

On an international scale, optimizing this magnitude of shipping

routes is intractable for classical computers. Research teams from
ExxonMobil and IBM are using this scenario to investigate how to
effectively map optimization problems to quantum computers.

In 2019, ExxonMobil was the first energy company to join the IBM
Quantum Network, a consortium of organizations that are provided
access to advanced quantum computing systems and tools. Exxon-
Mobil has used the network’s capabilities to explore methods that
map the routing of merchant ships globally to quantum computers.

The advantage of quantum algorithms is rooted in their ability to

reduce incorrect solutions while amplifying correct solutions. Using
the Qiskit quantum optimization module, ExxonMobil set out to
test various quantum algorithms. Depending on the aspects of the
problem, some heuristic quantum algorithms performed slightly
better than others, and Variational Quantum Eigensolver (VQE)-
based optimization performed better depending on the choice of the
ansatz (in physics terms, this is an educated guess or assumption).

These investigations could easily apply to other industries and use

cases that involve time constraints. Scenarios could include goods
delivery, ride-sharing services, or urban waste management.

71
 The continuing quest
for quantum speed-up

Identifying problems that quantum computing can solve is a vibrant area

of ongoing research, and for this fourth edition of The Quantum Decade,
we explore it further. How can quantum computing provide computa-
tional advantage in the three main areas we’ve just discussed, each with
different timelines and promises for speed-up?

Quantum simulation of natural processes involves computing properties

of quantum mechanical systems (think energetics) found in natural sci-
ences such as chemistry, physics, biology, material sciences, and so forth.
Electronic configurations required to describe materials grow combina-
torially and often have non-classical correlations, or entanglement.

Quantum computing can efficiently represent a state of entanglement,

a critical quantum mechanical property that requires exponentially
more computing resources to represent with a classical computer.
Simulation of time evolution is polynomially expensive on quantum
computers. Exponential speed-up is not, in general, guaranteed for
solving ground and thermal states or any system. However, there is
a strong belief that exponential speed-up will be a feature of natural
systems with local interactions.

Search-and-graph problems use quantum algorithms with a quadratic

speed-up such as amplitude estimation and amplification or heuristic
algorithms that use a quantum Hamiltonian. Even though currently
available algorithms do not offer exponential speed-up in search and
optimization, these can be applied to finance or logistics industries
where even a small speed-up can bring substantial savings.

72
IBM Quantum and University of
California, Berkeley researchers
A winning algorithm for
quantum machine learning 58

Machine learning in a quantum computing environment is intriguing to researchers. Over the past few
years, they have proposed quantum machine learning algorithms that promised quantum speed-ups
over their classical counterparts.59 Most of these learning algorithms assumed access to the data as
coherent quantum mechanical states — yet the world operates with classical data.

Researchers from IBM Quantum and the University of California, Berkeley explored the possibility
of finding circuits that are hard for classical computers and using them to provide an advantage in
machine learning tasks requiring only access to classical data.

In the case of supervised machine learning, the researchers in this case study map data to spaces in
higher dimensions, or feature spaces, to work with it, and the space of the state of multiple qubits is
itself rich and high dimensional. In other words, a quantum environment takes data to those high
dimensions naturally.

The researchers used quantum circuits to map classical data to the higher dimensional space of
multiple qubits, and to estimate the quantum kernel, which is a similarity measure between the pieces
of data. The estimated kernel was then used in a classical support vector machine to calculate the
support vectors that separate the data.

In late 2020, the researchers provided rigorous proof of Quantum Advantage for a quantum feature
map circuit over all possible binary classical classifiers, requiring access to just classical data. This
may be useful in applications such as forecasting, prediction of properties from features in data, or risk
analysis. For the first time, we have formal theoretical proof of Quantum Advantage in machine learning.

73
 Algebraic problems exploit a large parameter space that can be accessed by quantum computation.
With the kernel method (similarity measures between two pieces of data), user data can be represented
and mapped to a quantum-enhanced feature space through nonlinear mapping by a quantum circuit.
This allows users to uncover relations in data by a simple linear classification.

Exponential speed-up has been proven for quantum kernel approaches.60 This suggests that applications
of the quantum kernel method can expand to areas that benefit from machine learning approaches,
but where the data structure is too complex for classical classification methods. Nonlinear differential
equations are included in this category because they rely on interdependent solutions that disobey the
superposition principle.

Simulating electronic structure problems accurately using quantum computers often requires deep
quantum circuits to capture all contributions to correlation energy, even for small molecular systems with
strong correlations. Families of quantum circuits exist that represent quantum kernels. These kernels,
while hard to simulate using classical computers, could be simulated on quantum computers with
shallower depth compared to the electronic structure problem. This line of thought suggests that the
path to Quantum Advantage might be shorter for machine learning applications.

Still to come: a thorough comparison of runtime analysis between chemistry and machine learning
problems that are stipulated to provide Quantum Advantage.

In short, we’ve identified several use cases that could bring tremendous value to industry and may benefit
from the additional computational power that quantum computers bring. The applications that stand to
benefit the most from quantum computers are those that carry the most potential for Quantum Advantage,
because this could offer the greatest amount of computational speed-up over classical methods.

The two most promising areas of application research for Quantum Advantage lay in processing data with
complex structure and simulations of nature. A third area, search and optimization, may provide modest
improvements over classical approaches. Even so, it remains a priority research area due to the vast
number of use cases that would benefit from even modest advances and rate of innovation.

Circuit compositions and reduced depth associated with quantum machine learning algorithms may
position them to compete with classical analogs before those used in the simulation of nature. A number
of novel algorithmic techniques that leverage quantum and classical components and involve error
mitigation enable the exploration of quantum computing applied to these use cases today—and positions
users for the future.

74
[Link]
Taming risk with quantum
computing strategies 61

[Link], based in Germany, serves as one of the largest operators The company worked with IBM to incorporate quantum com-
of energy networks and infrastructure in Europe. The company puting strategies into this endeavor. For example, [Link] used
runs power stations, renewable generation facilities, power quantum nonlinear transformations to compute energy con-
grids, and electric vehicle charge points across the continent. tract gross margins, with nonlinear functions of temperature
The firm has set a goal to reduce emissions by 55% by 2030.62 approximated by quantum Taylor expansions. As well, the
company conducted risk analysis using quantum amplitude
Serving 47 million customers in 15 different countries comes estimation to leverage dynamic circuits. [Link] also integrated
with challenges, especially when [Link] is expected to connect quadratic speed-up into classical Monte Carlo techniques and
6 million additional renewable assets to its grid infrastructure optimized hardware resource requirements. The strategies
in Germany by 2030.63 proved successful, with benefits including:

To better manage variabilities, [Link] needed a more effective — Real-time planning and decisioning
way to analyze weather-related risk. The solution would need — Finer risk diversification
to manage extensive Monte Carlo simulations that spanned — More frequent reassessment of portfolio risks for
multitudes of locations, contracts, days, and weather and renegotiation of hedging contracts
pricing fluctuations. Mitigating risk in this manner was essential
to [Link]’s business model and mandate of solidifying affordable Overall, the company sees quantum computing as a technologi-
energy costs. cal game changer, specifically for machine learning (improving
classical machine learning algorithms), modeling (risk analysis,
accelerated Monte Carlo techniques, and system modeling), and
combinatorial optimization (logistics, scheduling, and graph
partitioning).

“Working together with IBM Quantum, [Link] is using this

cutting-edge technology to research complex challenges
in today’s quickly changing decentralized energy grid. We
believe that our partnership will play a part in unlocking the
potential of applied quantum computing to our industry.”

Victoria Ossadnik
Chief Operating Officer, Digital and Innovation
[Link]

75
 Wells Fargo
Partnering with IBM to
investigate sequence modeling 64

You may be surprised to learn where ideas for practical appli- Specifically, the joint Wells Fargo and IBM teams investigated the
cations that tap into breakthrough quantum computing tech- problem of sequence modeling inspired by the mid-price move-
nology are being explored. One place this work is happening? ment prediction use case. The evolution of asset prices on today’s
At a bank—Wells Fargo. The global financial organization is a exchanges is driven by the interaction of ask-and-bid orders placed
member of the IBM Quantum Network, a collaboration that on an electronic two-sided queue known as a Limit Order Book.
allows its developers to access IBM’s fleet of quantum computers
via the cloud. One important statistic associated with the Limit Order Book
is the mid-price, which is the mean of lowest ask order price
“Wells Fargo is an amazing industry partner in the IBM Quan- and highest bid order price at any given moment. In one of the
tum Network,” says Darío Gil, IBM’s Senior Vice President and approaches, Wells Fargo implemented stochastic generators
Director of IBM Research. “Their quantum researchers collab- known as quantum hidden Markov models (QHMMs).65
orate with us to be able to explore use cases and applications
like sampling and optimization and machine learning using Each hidden Markov model defines a stochastic process language.
quantum—all in an effort to start seeing valuable results from Similar to large language models (LLMs), the most popular kind of
quantum computing. It’s a wonderful collaboration that we get language-based generative AI, the goal is to generate a sequence
to do.” of most likely tokens, or observable symbols, given a particular
start state.
For example, Vanio Markov, a Distinguished Engineer at
Wells Fargo, has worked with IBM to test and implement new In one example we may consider two symbols: 0 and 1. At any
machine learning generative models, using quantum to given moment, the symbol 1 is observed if the price has increased,
potentially improve our artificial intelligence technology. while the symbol 0 is observed if the price has decreased or
remained unchanged. We prove that QHMMs are more efficient
definitions of stochastic process languages compared to the
equivalent classical hidden Markov Models (HMMs).

“Our quantum models of stock prices are simpler than the

classical models … so quantum learning can be very efficient.
We hope that our quantum algorithm will enrich the ensemble
of algorithms Wells Fargo uses to estimate stock prices.”66

Vanio Markov
Distinguished Engineer
Wells Fargo

76
IBM and Boeing
Advancing quantum chemistry
research on the mechanism for
corrosion by combining hybrid
classical and quantum resources 67

Designing corrosion-resistant materials is a critical task that could make airplanes easier to maintain,
but performing experiments on these new materials is often very expensive or otherwise impractical.
Numerical simulations present a much more practical alternative for researchers who wish to model
and study the molecular systems that make up experimental materials. However, classical computers
are only able to create approximate simulations of molecular systems, and those approximations
become even less accurate when dealing with molecular systems that are large in size.

Quantum computers, by contrast, have the potential to compute precise simulations of even incredibly
complex molecular systems. However, these systems may be too large for our current generation of
quantum hardware to simulate them all at once. That’s why researchers use a class of techniques called
“circuit knitting” to break up those larger molecular systems into smaller simulation problems.

A circuit knitting technique like quantum embedding, for example, makes it possible to focus the
quantum computer’s efforts on a tractable partition of the full simulation problem. When researchers
combine circuit knitting with classical pre- and post-processing techniques like active space selec-
tion — which serves to identify the portion of the chemical system that is active during chemical
reactions—they can extrapolate their solutions to understand properties of the entire system.

Researchers from IBM and Boeing collaborated to develop automated methods of active space selection
suited to studying not only corrosion but all manner of chemical reactions that take place on surfaces.
By leveraging local embedding methods with the designated active spaces, the researchers were able
to use variational quantum algorithms to study the splitting of a water molecule on a magnesium
surface. At the time of completion, this study represented one of the first-ever instances of quantum
algorithms being used to investigate surface reactions.

77
 IBM and JSR
Exploring how quantum computing
could shape the future of computer
chip manufacturing 68

Today’s computers are smaller and more powerful than ever—and

famed engineer and businessman Gordon Moore called it. Back in
1965, he predicted that the world could double the number of transis-
tors packed onto a single computer chip every two years for at least
a decade. That prediction came true — and for much more than just
a decade. Clever engineers have consistently achieved the biannual
milestone now known as “Moore’s Law” ever since.

The continued accuracy of Moore’s Law has largely been powered

by a remarkable trick of chemistry. In the 1980s, a team at IBM
discovered a new method for printing transistors onto chips using a
special, light-sensitive material called photoresist. That technique
soon became commonplace, with the Japanese technology company
JSR Corporation emerging as one of the world’s leading photoresist
producers. Now, researchers at IBM and JSR are working together to
see how quantum computing could take the field even further.

A photoresist is a mixture of long, string-like molecules and photo-

sensitive molecules that form the circuit pattern on semiconductors
by light irradiation. Companies like JSR are constantly designing new
and improved photoresist molecules, but the process is costly and
time-consuming. Modern supercomputers have a difficult time
simulating the quantum-scale phenomena of molecular systems,
so it’s difficult to predict how a new photoresist will behave until
researchers have tested it in real-world conditions.

Quantum computers, which harness the laws of quantum mechanics

to perform computations, could be much more efficient. The
technology still has a long way to go, but in a 2022 paper, researchers
from IBM and JSR Corporation used IBM Quantum hardware to
simulate small molecules that mimic parts of a photoresist.
Continued research in this area could be key to ensuring Moore’s
Law continues to ring true long into the future.

78
79
80
Prioritizing use cases
for business value
69

Evaluating the potential business impact of quantum computing

applications can be challenging, particularly given the complexity
of this emerging technology. Your organization needs a way to
evaluate which potential quantum computing applications are
better positioned to deliver optimum business benefits.

A quantum computing “prioritization matrix” helps address this

dilemma. Executives from various disciplines in your organization —
including strategy, operations, innovation, IT, and risk — can evaluate
the potential impact of quantum computing on their domains,
prioritize quantum computing applications, and subsequently
measure Quantum Advantage as your organization moves from
early adoption to mainstream quantum computing.

Our prioritization matrix categorizes quantum computing

applications into four distinct categories:

1 2 3 4
Early Bloomer Late Bloomer Wild Card Mature Industry

applications are the most applications promise applications may or may applications can deliver
feasible to implement today. significant Quantum not ultimately deliver clear competitive advantage
Advantage in the future. business advantage. on a business scale.

“It all comes down to the ‘killer app’ and what problem quantum
computing can solve for your industry. It may not be obvious,
just as in the early days of the internet, but it’s about realizable
use cases, not outlandish or esoteric problems.”

Todd Hughes
Technical Director, Strategic Projects and Initiatives
CACI

81
 A tested prioritization
framework
70

Our quantum computing prioritization matrix

helps executives evaluate each application in
three dimensions (see Figure 17):

Quantum speed-up
Theoretical capacity to deliver technological
advantage over classical computing solutions
(Y-axis).

Near-term technical feasibility

Operational readiness
(X-axis).
Use case C

Relative potential business impact by use case

Use case B Ability to drive unique business
value for a specific enterprise
(bubble size).
Quantum speed-up

Use case A
Prioritizing quantum computing applications in this
way provides a comprehensive portfolio overview,
visually graphing an organization’s decision trade-offs.
Near-term technical feasibility As a result, you can make more informed decisions
about your organization’s quantum computing adop-
Ability to drive unique business value tion based on strategic priorities, such as following
Low High a first-to-market strategy, a cost-optimization
approach, or acting as an industry disruptor.
FIGURE 17

The quantum
prioritization framework
A visual representation of
decision trade-offs

82
The Y-axis: Quantum speed-up Bubble size: Business impact
Overall, the promise of Quantum Advantage is to efficiently solve The third dimension of the quantum computing prioritization matrix
particular business problems that are not currently feasible (or are is tailored to the size of the business impact each application
prohibitively expensive) to resolve due to today’s computational is predicted to have for a specific enterprise. This dimension
constraints.71 Correspondingly, where an application sits on the incorporates business metrics exclusively chosen by each organi-
quantum computing prioritization matrix’s Y-axis is dependent zation. As part of each individual company’s selection process, it
upon the theoretical magnitude of improvement a specific quan- is important to realize that assessing business impact is more than
tum computing algorithm is expected to deliver over a classical merely measuring economic outcomes.
solution. An individual application’s Quantum Advantage may
manifest in different ways. One example is a faster runtime to find Metrics should be a blend of market outcomes and competitive
a desired solution or a better approach to solving a problem that consequences, as well as financial impact. For example, depending
achieves greater accuracy. on an organization’s strategic objectives, this dimension may
include measures of value chain enhancement, operational
improvement, market disruption and/or innovation, market share
growth, revenue generation, cost reduction, and/or risk mitigation.

The X-axis: Near-term technical feasibility

The quantum computing prioritization framework’s X-axis depicts
the technical requirements for quantum hardware and software
needed to successfully execute each identified application. A key
aspect of this is the expected qubit and performance requirements.
Placement on the X-axis is also impacted by further quantum
computing hardware and software considerations, such as chip
and algorithm design, qubit interconnectivity, number of gates
and qubits used in the code, and the compiler’s efficiency.

Even though quantum computing technologies are in a nascent

state, some algorithms, such as quantum approximate optimi-
zation algorithm (QAOA) or quantum support vector machines
(QSVM), have shown potential to run better on near-term quantum
systems due to their shorter circuit-depth requirements, while
other algorithms will need mature quantum computing systems
to run more sophisticated problems.72

83
 Quantum computing
application classification
73

As noted earlier, employment of the quantum computing

prioritization matrix elucidates four quantum computing
application categories: Early Bloomer, Late Bloomer, Wild
Card, and Mature Industry (see Figure 18). Identifying a
diverse mix of these types of applications prepares your
organization to respond rapidly to breakthrough advances in
Late Mature quantum computing technology (see Perspective, “Applying
Bloomer Industry the quantum computing prioritization matrix,” on page 86).
Quantum speed-up

Wild Early
Card Bloomer

Near-term technical feasibility

FIGURE 18

Quantum computing
application categories
Rapid responses through
diversified applications

84
Early Bloomer Wild Card
Early Bloomer applications are the “no-brainers.” Because their Wild Card applications do not currently exhibit a straightforward
solutions are heuristic, businesses can experiment with and use path to deliver the substantial Quantum Advantage of Late Bloomers,
them to help build talent. Since Early Bloomer applications operate nor are they as technically feasible as Early Bloomer applications
using existing technology, their adoption is a profound step for are today. While they may or may not ever pan out, evaluating
organizations learning how to use quantum computing. The use of them helps you to better understand how quantum computing’s
these applications helps clarify how to integrate quantum computing attributes could apply to your organization’s future success. These
into your current business processes and build momentum for long shots are not to be completely counted out. As quantum
additional quantum computing adoption. Adopting Early Bloomer technology evolves, some Wild Cards may transform into Early
applications initially may be critical to sustaining marketplace or Late Bloomers.
relevance, as they may establish the basic requirements necessary
to remain competitive.

Late Bloomer Mature Industry

Late Bloomer applications pose the “innovator’s dilemma.” Mature Industry applications are the ultimate goal for businesses
They promise the greatest Quantum Advantage, but they leveraging quantum computing. Although no application has yet
require more advanced quantum computing technology to solve demonstrated Quantum Advantage at business scale, in the future —
meaningful business problems. Late Bloomer applications can if quantum computers achieve sufficient scale and quantum comput-
potentially transform competition in particular industries through ing applications demonstrate competitive value — some will confer
their potential to significantly impact business value in the future. business advantage, transforming company operating models and
Because it is less clear when Late Bloomer applications will industry value chains. Some applications already in development
become technically feasible, your organization needs to keep may be placing their creators on the path to significant marketplace
a close watch on advancements in quantum computing. A new success even now.
quantum computing algorithm or hardware approach could
cause a Late Bloomer to leapfrog into technical feasibility. Due
to their expected impact on company value chains, competitive
success can accrue disproportionately to those companies that
are first to recognize and implement Late Bloomer quantum
computing applications.

85
 Perspective
Applying the quantum computing
prioritization matrix 74

To illustrate how the quantum computing prioritization

matrix works, let’s take the actual quantum computing
application investigation undertaken by a financial services
trading organization. This financial institution identified four
potential uses of quantum computing that are computationally
challenging for conventional machines:

1 2 3 4
Value-at-risk Derivative Fraud Credit/asset
analysis pricing detection scoring

Strengthening risk Improving the pricing Enhancing the detection Strengthening the statistical
mitigation by developing of financial assets of irregular patterns to flag analysis that segments
more accurate using market-scenario fraudulent transactions customer financial solvency
risk-simulation models. . simulations. and imposters. and bond ratings.

86
 Each of these potential applications can be solved by a specific
quantum computing algorithm that helps designate its level
of quantum speed-up and its stage of technical feasibility
(see figure):

—Value-at-risk analysis and derivative pricing are solved with a

simulation algorithm, called quantum amplitude estimation Late Mature
(QAE), to estimate scenarios. This type of algorithm delivers a Bloomer Industry
quadratic speed-up while improving the quality of the solution,
even though quantum error correction could diminish the advan-
1 2
tage. However, it requires mature quantum computing systems.
Applications associated with this algorithm are usually identified
as Late Bloomers.

—Fraud detection and credit/asset scoring are solved with machine-

learning algorithms for classification and prediction (QSVM). This
type of algorithm can run on near-term quantum systems and
3

Quantum speed-up
4
may bring increased accuracy. However, the benefit needs to be
proven as quantum system capacity increases, typically placing Wild Early
associated applications as Wild Cards. Card Bloomer

The business value these applications might collectively bring to

the financial services industry could surpass $10 billion in the Near-term technical feasibility
first year of their launch.75 Enhancing fraud detection and reducing
monetary losses from money laundering could deliver more than
half of the total.
Four quantum applications Relevant algorithms

1. Value-at-risk analysis QAE

2. Derivative pricing
3. Fraud detection QSVM
4. Credit/asset scoring

Quantum prioritization
in practice
Four financial applications

87
 Perspective
Charting a path to
business value 76

We have outlined five steps

to developing a quantum
computing portfolio for
your organization.

Step One Step Two Step Three

Identify the quantum Identify potential Position each application on

computing skills your quantum computing the quantum computing
organization needs. applications. prioritization matrix.

Determine whether to Select business problems Evaluate the technology profile

acquire them directly, or opportunities likely to of each proposed application,
hire a consultant, and/or benefit from the unique both in terms of potential
join an existing quantum capabilities of quantum quantum speed-up and near-
computing ecosystem to computing, such as those term technical feasibility,
access them. constrained by resources based on state-of-the-art
or huge optimization quantum computing hardware
calculations. and algorithms.

Step Four Step Five

Determine the expected Plan for

business impact. quantum adoption.

Assess the size of the projected Determine whether you will

business impact by analyzing purchase a quantum computer
each application’s potential or access the latest quantum
competitive advantage and computing technology through
expected financial benefits a partnership arrangement.
specific to your organization. Plan for quantum computing’s
impact on your internal work-
flows, including potential process
redesign and resource allocation
adjustments.

88
 Questions
to ask

2
Question Two

Think about your intractable

industry problems we
discussed in Chapter Two.

How do simulation, search,

and algebraic use cases

1 3
play in their resolution?

Question One Question Three

Where do you see your Take the quantum

organization positioned computing prioritization
during each of the matrix for a test drive.
“three waves” of
Quantum Advantage? What were the results?

Were there any surprises?

89
90
The Quantum Decade

Industry
guides

As we’ve discussed, Quantum Advantage occurs when a computing task critical

to science or business can be performed more efficiently, more cost effectively, or
with better quality using quantum computers. This is where quantum computers
plus classical systems can transcend what classical systems can do alone.

As hardware, software, and algorithmic advancements in quantum computing converge, enabling

significant performance improvement over classical computing, new opportunities for advantage will
emerge across industries.

In this section, we provide quantum adoption information across nine specific industries: airlines,
banking and financial markets, chemicals and petroleum, electronics, government, healthcare, insurance,
life sciences, and logistics. Each section contains industry-specific observations and use cases to help
guide your quantum journey.

While attaining Quantum Advantage can take some time, it can still trigger exponential achievements in
usage and learning that can benefit your business — and industry — now.

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Quantum computing applications

Airlines

While organizations in the travel and transportation sector took some of

the worst hits from the COVID-19 pandemic, business has bounced back. Quantum computing
International travel bookings for 2023 were up 40% from 2022 through use cases for airlines
May 2023. That is down 2% from 2019, but still a significant increase.77

Untangling
Some organizations viewed the crisis as an opportunity not only to survive,
operational
but to evolve and emerge stronger. As the travel business continues to thrive,
disruption
the industry needs to prepare for growth by exploring new technologies and
solutions for first-mover advantages. Quantum computing is one of those
technologies.

Quantum computing opens the door to new opportunities across industries,

mainly through higher computational speed, greater accuracy of data-driven
actions, and the creation of new algorithms and systems capabilities to address
challenges that classical systems cannot solve. Quantum computing capabilities
could play a crucial role in solving airlines’ complex business problems. Optimizing network Enhancing
planning globally contextual
Following are three use cases where Quantum Advantage may transform how personalized
airlines seek to optimize operations and improve customer experience. services

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 Use case

Untangling operational
disruption for airlines
(IROPS)

Pandemics, storms, earthquakes, operational issues, technical problems, and other challenges can wreak havoc
on airline schedules and staffing. Recovering from such disruptions is one of the most difficult problems that
airlines manage. Current solutions are fragmented and primarily focused on operational information, with less
consideration given to inventory, profit maximization, or even the impact on customer service and satisfaction.

Airlines currently work through these disruptions — known as —Improve the accuracy and speed of scenario simulations that
irregular operations (IROPS) management — using suboptimal quantify the impact of potential solutions on future flights and
algorithms on classical computers. Due to the limitations of passengers — and do it in time to respond to a disruption. Quantum
current computers, each specific element, such as crew, slots, computing algorithms have already proven effective in choosing
and equipment, is managed in a sequential and siloed manner. the best scenarios in Monte Carlo simulations used in banking
System-wide recovery can take a week or more, threatening and finance.78
passenger satisfaction, and second-order effects on other flights
and airports can drive higher costs for an airline. —Provide a simulation tool to operation control center analysts so they
can proactively test scenarios before a major event that may disrupt
The technical limitations of current IROPS solutions are primarily operations, such as air traffic control or crew work stoppages or
linked to: aircraft delivery delays. Due to the complexity of these issues, today
they can only be solved for each functional area separately, thwarting
1. Lack of data visibility to incorporate all relevant inputs into the the development of integrated solutions.
resolution of the disruptions.
2. Fragmentation of solution development. Different parts of the —Deliver advisory tools to customer service agents and automated
IROPS problem — fleet, crew, passengers, look-ahead impact — customer care systems using quantum machine learning to advise
are solved separately in multiple steps with different tools, on best approaches to IROPS resolution. For example, a quantum
which leads to suboptimal and inefficient solutions. computing algorithm could advise agents on how to best compensate
each specific customer whose travel has been disrupted based on
It’s the second limitation — fragmentation of solution development personal preferences for cash, accommodations, upgrades, or other
— where quantum computing could help. Due to the massive amenities. Imagine how customer satisfaction might improve if you
scope of IROPS and the resulting complexity of the underlying could do this today.
global mathematical optimization problem, solving a single
operational disruption on today’s computers could take years — In these ways, quantum capabilities could dramatically shorten
or even centuries. With improvements in quantum algorithms recovery time and reduce the cost of irregular operations while
and better error-correction schemes, airlines may be able to: mitigating their negative impact on passengers.

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 Use case

Enhancing contextual
personalized services
for airline customers

The “segment-of-one” is a personalization strategy for which

For the global travel industry, one of the pivotal actions scalability is probably the biggest challenge. As sophistication in
digital marketing grows, organizations are likely to see increases
for survival and recovery is to restore customer trust and
in the number of users for whom they need to create personalized
confidence by creating personalized services that emphasize
experiences. It is one thing to personalize a landing page for one
health and safety measures.
customer segment, but it’s a completely different challenge when
you have hundreds of personas, multiple geographies, a dozen
sites, and thousands of places where personalization is needed.
At that point, personalization strategies need to scale in order to
For airlines specifically, it’s key to differentiate services, improve be feasible.
customer experience, and drive incremental revenue though
individualized offerings. Providing personalized customer engage- Quantum computing may solve these problems, enhancing the
ment and services requires four specific steps: personalization process by:

1. Collecting and extracting data, including customer data and

—Supporting richer customer segmentation, incorporating more
transactional data.
complex customer features for multidimensional passenger
2. Performing data engineering to build customer data features.
segmentation, and allowing for higher specificity in contextual
3. Training customer segmentation models based on customer
profiling to improve personalized offerings.79
and journey context features.
4. Scoring and identifying the best offers depending on customers’
—Improving the accuracy of machine learning models that deliver
individual travel contexts.
insights and interpretability of results to help marketers or customer
service agents better understand the causality links between
Today’s personalized offering systems often fall short of living up
customer data and delighted passengers.
to their promises, mainly because of limitations in the customer
segmentation step. Current segmentation methods often rely on
—Potentially enabling the identification of a dramatically greater number
basic customer features, such as demographic and sales data,
of finely tuned customer segments that is unmanageable for classical
but do not include contextual data, reducing the pertinence of the
computers through better machine learning capabilities.
recommended offer. Current systems also lack multidimensional
segmentation to effectively capture contextual differences in
If airlines can leverage quantum computing to unlock the promise of
preferences, intent, and behavior of travelers. One reason for the
contextual and dynamic personalization, that personalization can then
absence of contextual features is insufficient computing capacity
help increase ancillary revenue, provide better customer experience,
and scale to handle the high number of data elements required
and support service differentiation.
to build complex segmentation models.

95
 Use case

Optimizing airline network

planning globally

In addition to the steep decline in global travel demand due to the COVID-19 pandemic, airlines are also
facing major shifts in customer preferences for new routes, close-to-departure bookings, and no-fee itinerary
changes. Addressing such challenges requires dynamic and flexible network planning processes that can no
longer depend on historical demand data.

Network optimization, from flight planning and fleet allocation to crew scheduling, is at the heart of air-
line operations, significantly impacting operational costs. But, despite substantial efforts dedicated to
streamlining this process, there are still important limitations. They are mainly linked to a step-by-step
approach that leads to local optimization of the sub-processes deployed with isolated decision support
tools. These tools generate suboptimal, local, and uncoordinated solutions.

For example, aircraft route planning often does not incorporate crew scheduling. Similarly, crew sched-
uling does not include block times, and block-time planning does not factor in fuel planning, often with
detrimental consequences. Additionally, network planning typically does not coordinate its solution
optimization with revenue management (RM) and pricing, resulting in two major processes happening
daily with the same objective — profit optimization — but with separate models and parameters.

This out-of-sync approach leads to inferior solutions in terms of total cost, profit, and adapting to
change. It also causes confusion during key operational updates, such as the introduction of new types
of aircraft or the opening of new routes. While RM or pricing is optimizing offers based on schedule,
capacity, and aircraft configuration, network planning may be inadvertently changing these parameters
based on profit optimization. The main reason for airlines taking this distributed solution path is the
complexity required to solve a global network optimization problem in a single step. It is practically
impossible to solve with current classical computers alone.

In the future, quantum computers, working in concert with classical computers, should enable an
airline network to co-optimize fleet, schedule, block/gates, crew, and fuel, while dynamically coordi-
nating with RM, pricing, cost targets, sales, and customer relationship management (CRM). This is
because quantum optimization algorithms can search the universe of solutions more widely and
efficiently.80 In order to make the best use of future quantum capabilities, airlines need to change
the way they manage network operations, with more centralized operating models and tighter data
integration. The expected results could be a proprietary competitive advantage for the airlines that
embrace quantum technology.

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Quantum computing applications

Banking and
financial markets
The financial services industry has a history of successfully applying physics to
help solve its thorniest problems. The Black-Scholes-Merton model, for example, Quantum computing
uses the concept of Brownian motion to price financial instruments — like use cases for banking
European call options — over time.81 and financial markets

Targeting
Applying emerging quantum technology to financial problems — particularly
and
those dealing with uncertainty and constrained optimization — should also prove
prediction
hugely advantageous for first movers. Imagine being able to make calculations
that reveal more profitable arbitrage possibilities that competitors are unable to
see. Beyond that, employing behavioral data to enhance customer engagement
and enabling faster reactions to market volatility (for example, intraday versus
overnight risk calculations) are some of the specific benefits we expect quantum
computing to deliver.

While broad commercial applications may remain several years away, quantum
computing is expected to produce breakthrough products and services that will Trading Risk
likely solve very specific business problems within three to five years.82 Quantum optimization profiling
computing can also enable financial services organizations to re-engineer opera-
tional processes, such as front-office and back-office decisions on client man-
agement; treasury management, trading, and asset management; and business
optimization, including risk management and compliance.

Quantum computing’s specific use cases for banking and financial markets can
be classified into three main categories: targeting and prediction, risk profiling,
and portfolio optimization.

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 Use case

Targeting and
prediction

Today’s financial services customers demand personalized products and services

that rapidly anticipate their evolving needs and behaviors. 25% of small- and
medium-sized financial institutions lose customers due to offerings that don’t
prioritize customer experience.83

Customer behavior patterns are complex, and missing aspects of these relationships can prevent
financial institutions from providing preemptive product recommendations with optimal feature selection.
This can lead to failure to grasp opportunities to expand current customer share of wallet or reach the
1.7 billion adults worldwide who are unbanked.84

A similar problem exists in fraud detection. According to some estimates, financial institutions are losing
up to $10 billion a year in revenue due to poor data management practices, and total losses from fraud
were as high as $56 billion in 2020.85 Fraud detection systems remain highly inaccurate, returning in the
vicinity of 80% false positives, causing financial institutions to be overly risk averse.86 To help ensure
proper credit scoring, the customer onboarding process can take as long as 12 weeks.87 In today’s envi-
ronment, where 70% of banking takes place digitally, consumers are just not willing to wait that long.88
Financial institutions too slow in engaging effectively with new customers are losing them to more
nimble competitors.

For customer targeting and prediction modeling, quantum computing could be a game changer. The
data modeling capabilities of quantum computers are expected to prove superior in finding patterns,
performing classifications, and making predictions that are not possible today because of the challenges
of complex data structures.

100
Use case

Risk
profiling

Financial services institutions are under increasing pressure to balance risk, hedge positions more
effectively, and perform a wider range of stress tests to comply with regulatory requirements.
Liquidity management, derivatives pricing, and risk measurement can be complex and calculations
difficult to perform, making it hard to properly manage the costs of risk on trades.

Today, Monte Carlo simulations — the preferred technique to analyze the impact of risk and uncertainty
in financial models — are limited by the scaling of the estimation error. Simulating all of the risks in a
financial institution can be prohibitive and may include portfolios of many options, requiring numerous
samples and hours to complete.

Looking forward, we expect continual waves of overlapping amendments to regulations, directives,

and standards, such as Basel III and its revisions.89 They will require a much larger array of risk-
management stress scenarios. As a result, compliance costs are expected to more than double in
the coming years, including regulatory penalties and remediation in cases of non-compliance.90

In the face of more sophisticated risk-profiling demands and rising regulatory hurdles, research and
breakthroughs in quantum computing capabilities may speed up these very long risk-scenario simu-
lations with higher precision, while testing more outcomes.

101
 Use case

Trading
optimization

Complexity in financial markets trading activity is skyrocketing. For example, the valuation
adjustments model for derivatives, the X-Value Adjustment (XVA) umbrella, has greatly
increased in complexity, now including credit (CVA), debit (DVA), funding (FVA), capital (KVA),
and margin (MVA).91

Due to greater transparency requirements from regulations, stricter validation processes are applied
to trading, impacting risk-management calculations that need to align counterparty credit exposures
with credit-limit utilization of derivatives portfolios.92 Furthermore, significant investment frame-
works and vehicles have changed. For example, bond exchange traded funds (ETFs) are projected to
reach $2 trillion by 2024, and environmental, social, and governance (ESG) investments are gaining
traction, with $35 trillion invested in this asset taxonomy in 2019.93

In this complicated trading landscape, investment managers struggle to incorporate real-life

constraints, such as market volatility and customer life-event changes, into portfolio optimization.
Ideally, money managers would like to simulate large numbers of potential scenarios and investment
options to validate sensitivities when estimating expected returns. Currently, finding the best rebal-
ancing strategy that keeps up with market movements is significantly constrained by computational
limitations and transaction costs.

Quantum technology could help cut through the complexity of today’s trading environments. Quantum
computing combinatorial optimization capabilities may enable investment managers to improve portfolio
diversification, rebalance portfolio investments to more precisely respond to market conditions and
investor goals, and more cost-effectively streamline trading settlement processes for large portfolios.

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 Quantum computing applications

Chemicals
and petroleum
The chemical industry has a hand in about 7% — or $5.7 trillion — of global domestic product, along
with approximately 120 million jobs.94 Developing new chemical products requires expensive and Quantum computing
time-consuming lab work. Today, classical simulations of chemistry can help guide lab testing, but use cases for chemicals
the accuracy of calculations decreases as the complexity of molecular interactions increases. and petroleum
Optimizing feed
stock routing,
When attempting energy calculations in a quantum mechanical system such as large molecules,
refining, and taking
calculating all the different parameters, including the movement of electrons, becomes intractable
product to market
on conventional computers. As a result, modeling many industrially important molecules becomes
increasingly inexact — or simply too time consuming to wait for an exact solution.

Determining the electronic structure of molecules is imperative to understanding the reactivity of

the molecule. As molecules increase in size beyond hydrogen (H2), the mathematical descriptions
of molecules that accurately capture electron-electron interactions, nuclear effects, etc. become
increasingly complex. In fact, when a full configuration interaction calculation is performed
classically, the algorithms have exponential scaling. However, due to the nature of quantum
algorithms, chemistry calculations have been predicted to scale polynomially, a promising step Developing chemical Expanding
toward the ability to perform exact calculations on molecules that are currently out of reach. products, including reservoir
catalysts and surfactants production
For example, the simple hydrocarbon Naphthalene (C10H8), could be modeled with ~116 qubits,
but it would require a classical computer with 1034 bits to do the same.95 For perspective, 1034
bits is 7.1 billion times the total volume of data predicted to be stored electronically by 2025 —
perhaps 175 zettabytes.96

Quantum computing may change the way chemicals are designed, hydrocarbons are refined, and
petroleum reservoirs are located and produced. In the next few years, it may accelerate the go-to-
market cycle in the development of new chemical products, refine investment strategies in light
of tightening environmental regulations, and optimize complex systems that directly impact profits,
such as transportation, refinery, and chemical plant processes.

Eventually, quantum computers may be able to tackle reservoir simulation and seismic imaging.
Consequently, quantum computing is expected to fundamentally disrupt the landscape of the
chemicals and petroleum industry. We have identified three powerful quantum computing use
cases already being explored by chemicals and petroleum companies:

—Developing chemical products, including catalysts and surfactants

—Optimizing feed-stock routing, refining, and taking product to market
—Expanding reservoir production.

105
 Use case

Developing chemical
products, including
catalysts and surfactants

In this use-case scenario, chemical and petroleum companies use

quantum computers to accelerate the discovery and development of
new chemical methods and materials. Prototype quantum computers,
supported by classical computers, are already performing quantum
chemistry simulations.

In 2017, a cover story in Nature showed depictions of the small

inorganic salts lithium hydride (LiH) and beryllium hydride (BeH2)
modeled on IBM’s publicly available quantum computers.97
Application of these same variational methods to challenges in the
chemicals and petroleum industry may soon be possible — such as
applying insights to new catalysts for emissions reduction or
surfactants to improve subsurface recovery. These possibilities,
among others, have led some to consider chemistry the “killer app”
for quantum computing.98

106
Use case

Optimizing feed-stock
routing, refining, and
taking product to market

Perhaps surprisingly, similar approaches (using Hamiltonians)

employed in molecular modeling can be repurposed to address a
wide range of optimization problems, from transportation and
supply chain logistics to optimizing investment portfolios.99

In this use-case scenario, quantum computing could improve the

profit margins of chemicals and petroleum businesses by determining
optimal combinations of feed-stock routing, refining, and taking
product to market. The impact on a refinery can be viewed as the
estimated annual loss of business due to octane giveaway. Octane
and vapor pressure giveaways result in an annual loss of more than
$4.9 billion in the US and more than $4.2 billion in the European
Union.100

107
 Use case

Expanding reservoir
production

In 1856, Henri Darcy, a French engineer trying to design water filtration systems for the city
of Paris, created a simple experiment by flowing water through a tube filled with sand. His
observations led to Darcy’s law, which has formed the basis of the entire field of reservoir
simulation and production engineering.

However, modern developments in nanoporous unconventional reservoirs are causing Darcy’s law to
break down. One outcome is that the global oil hierarchy has been reordered, with the US becoming
the world’s top energy producer. Quantum computing may usher in a new generation of subsurface
understanding and reservoir simulation by allowing the exploration of molecular-scale physics in
tight reservoirs.101

In unconventional reservoirs, liquid oil flows as if it has a high permeability, similar to a gas, with
preferential production of short-chain hydrocarbons and leaving long chains behind. The physics
is inconsistent with conventional understanding of subsurface flow dynamics.

Using quantum computers to do molecular scale modeling of the interactions among oil, water,
and gas molecules with the surface of rocks could help explain the physics behind the disconnect
between Darcy and non-Darcy flow. If so, the benefits would be substantial.

For example, if the number of wells could be reduced by only 10%, the net cash flow of the top 32
North American unconventional oil producers would shift from a net loss of $1 billion (January to
September 2018) to a positive cash flow of $8 billion (based on an estimate of $6 million per well).102

108
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Quantum computing applications

Electronics

The electronics industry faces a growing myriad of challenges—the cost of the latest
generation of semiconductor manufacturing facilities is as much as $25 billion.103 Quantum computing
The design of electronics products grows more complex while expansion in some of use cases for electronics
the largest traditional markets, such as smartphones, is leveling off.104 And as design
and manufacturing have become increasingly difficult over the past 50 years, the
industry’s performance improvements have slowed down.
Product
design
In brief, the industry’s current path is becoming more challenging, risky, and expen-
sive. And this will be felt beyond electronics: as an enabling technology, electronics
are used by practically every industry.105 The electronics industry’s responses to its
challenges today could impact almost every sector of the global economy.

Quantum computing is a fundamentally new computing paradigm that may offer

the electronics industry a powerful tool to help tackle some of its biggest problems.
Three use cases illustrate quantum computing’s potential for the electronics indus-
try: materials development, product design, and smarter manufacturing. Materials Smarter
development manufacturing

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 Use case

Materials
development

The design and manufacturing improvements that enabled the electronics revolution over the
past 50 years have been slowing down. The world’s most powerful supercomputers used to increase
their performance capability 80% every year. Now it’s 40%.106 That’s partly because the era of simply
shrinking the transistor to improve computer performance is ending.

The electronics industry has sought other ways to boost compu- One reason that materials development is such a long haul:
tational performance, including new materials such as copper classical computers have difficulty simulating materials. Simply
interconnects and chemically amplified photoresists, both representing a material in a classical computer is challenging.
pioneered by IBM.107 But classical computers struggle to simulate To exactly represent a single molecule from one family of light
materials. As a result, materials development has had to rely on emitters, a classical computer would need 10106 bits. That exceeds
time-consuming and costly traditional lab research methods. the number of atoms in the universe (approximately 1084) many
times over. By contrast, a quantum computer could represent the
Take this example: Flat-panel displays, the primary interfaces same molecule using just 354 logical qubits. Moreover, a quantum
between us and our smartphones, drain power and quickly exhaust computer can manipulate this compact representation of a light
batteries. A more efficient display could be possible with a more emitter to predict interesting properties, such as its electronic
efficient light emitter. Yet that would require new materials, which structure and the color it generates.109
take a long time to develop. For organic light-emitting diodes
(OLED), now common on smartphones, it was 35 years from the The quantum capability to model new materials has wide application.
first paper about the technology to the first OLED display.108 IBM is using quantum computers to model more environmentally
friendly chemicals for electronics manufacturing.110 And IBM has
Let’s also consider two-dimensional transition metal dichalco- worked with Mercedes-Benz Daimler to perform quantum simulation
genides (TMDs) — atomically thin materials that have attracted of battery chemistry.111
significant interest in their potential to increase transistor
performance while reducing power consumption. The chemistry Another case in point: Current light emitters have an internal
and physics of TMDs are best described using quantum mechanics, efficiency of up to 25%. IBM, JSR, and Mitsubishi teamed together
which is challenging for classical computers — but a natural match to model OLED light emitters with the potential for 100% internal
for quantum computers. efficiency.112 An OLED display made from these emitters could have
substantial power efficiency advantages — and valuable market
advantages. Just a 1% increase in the OLED display market is worth
$320 million per year.113

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Use case

Product
design

A quantum computer’s skill at finding optimization solutions is

Design and manufacturing in the electronics industry are areas actually an expression of its ability to search. A good example of
of intense competition. The goal: products that perpetually perform this capability is design verification. Imagine spending two days
better, cost less, and are bug free. This takes time, yet the team that of each week doing your work and the other three days checking
your work. That’s more time verifying than executing — a slow and
gets its product to market first enjoys significant advantages.
inefficient process.

And yet, too often that’s precisely what happens with electronic
design. Microchips, for example, have grown so complex that
Quantum optimization may help product development teams more of the product cycle time (60%) is spent verifying chips
develop higher-performing designs more quickly. In electronics, than actually designing them.115 Unfortunately, a chip released
this has a multitude of applications. Imagine finding the fastest with an undiscovered bug can deliver a huge blow to a company’s
route for moving packets of data around a network. Or calculat- bottom line.116
ing the most profitable product mix and production schedule for
an electronics manufacturing plant. Or identifying the shortest Software is now part of nearly every product. And like microchips,
wiring route for 10 billion transistors on a chip. software has become so complex that complete verification isn’t
possible. For some products, like a music player, a software bug
Solving these sorts of optimization problems has long challenged might simply be a nuisance. But for other products, such as bio-
classical computers. But finding the optimal solution has the medical devices, undiscovered software bugs have the potential
potential to result in huge market advantages. A microprocessor to literally be a matter of life and death. One study shows that
with shorter wire lengths can simultaneously result in both lower 64% of biomedical device recalls are due to software faults —
power consumption and greater compute performance. In the the top cause of biomedical device recalls.117
smartphone application processor market, a particularly power-
sensitive market, a 1% increase in market share would translate A powerful design verification method employs Boolean satisfiabil-
into an additional $290 million per year.114 ity solvers, also known as SAT solvers. Like many optimization
problems, SAT solving can be challenging for classical computers.
One challenge these optimization problems pose to classical Quantum methods to SAT solving are being explored to search large,
computers: there are far too many possible solutions. For example, complex design spaces and increase the probability of finding un-
finding the shortest path between just 10 points requires find- known bugs.118 The aim is to help design teams more quickly verify
ing the best solution among over three million feasible paths. designs, develop a more reliable product, and get it to the finish
However, quantum computers have the potential to complement line faster.
classical techniques by finding the solution to these optimization
problems more efficiently. This may help product design teams
find higher-performing designs more quickly and get a better
product to market faster.

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 Use case

Smarter
manufacturing

Smart factory initiatives and digital transformation are increasingly priorities for manufacturing
operations, driving competitiveness and resiliency into the 2020s.119 AI can play a central role in this
transformation, but classical AI is hitting its limits.

One example: to keep costs low and yields high, electronics But we can now see beyond classical computing. We can
manufacturing facilities must quickly and accurately identify glimpse quantum computing’s potential to create smarter AI.
defective products. Classical AI has been employed for product
inspection and brings benefits such as speed and consistency to When IBM researchers compared quantum neural networks to
the process. But its accuracy is still far from ideal. Inspection AI classical ones with the same number of degrees of freedom,
has a high false-positive rate, meaning it too often flags products they demonstrated that — on some data sets — quantum neural
as bad when they’re actually good. There’s little point in having a networks can be more accurate and learn faster than classical
superfast machine if it’s often wrong. neural networks.124 Moreover, quantum machine learning
models have the potential to achieve lower error rates with
For silicon wafers, automated optical inspection has false-posi- less data.125
tive detection rates ranging from 10% to 15% — which are far too
high.120 A 10% loss of wafers at a five-nanometer facility would A more accurate AI that can learn faster with less data has many
be a loss equivalent to $8 billion per year.121 possible applications. In data networks, a more accurate AI can
more reliably identify security threats. In biomedical electronics,
Classical AI’s ability to distinguish good products from bad has hit a more accurate AI could help medical teams more reliably iden-
fundamental limits. In one analysis, the best error rate for image tify tumors in MRI images. In electronic design, an AI that learns
classification on the ImageNet data set was 11% at a cost of $1 faster with less data could identify better designs more quickly,
million.122 To achieve fully automated AI product inspection, the particularly at new process nodes when design data is scarce.
error rate must be brought to below 1%. But, if we extrapolate cur- And, for electronics manufacturers that have to establish new
rent trends in classical AI, getting an 11% error rate down to 1% manufacturing processes for product refreshes every year, both
would cost $100 billion billion. (That’s not a typo: $100 billion bil- time and data are precious and rare commodities. Quantum AI
lion.) What’s more, that process would produce one million times could help these electronics manufacturers get new products to
more carbon dioxide than the entire planet emits.123 market faster, with greater yields, and at lower costs.126

114
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Quantum computing applications

Government

In the face of economic volatility, geopolitical instability, extreme weather events, and rapidly shifting
demographics, the demand for public services has skyrocketed. Meanwhile, many governments have Quantum computing
often been in a reactive posture and struggled to adapt to rapidly shifting economic, social, and use cases for government
technological challenges.

Detecting fraud
Quantum computing can help governments tackle their most complex and consequential challenges.
in social
A prime example is climate change, which is endangering public safety by contributing to a maelstrom
programs
of extreme weather, pandemics, and wildfires. The sustainability of social programs is pressured by
rising costs and demand. And globalization is increasing travel and trade, straining transportation
systems everywhere.

The ability to solve complex problems with better results in a fraction of the time and resources
provides immense opportunities to governments that can effectively leverage the power of
quantum computing. We’ve already begun to see use cases emerge that can provide value for
governments. As this capability advances and experimentation continues, we expect quantum
computing applications to continue to grow and deliver value across government segments. Emergency Optimizing
preparedness transport
Following are three use cases in which Quantum Advantage may be a game-changer for govern- and response systems
ments seeking to remediate their toughest problems. These include the ability to more precisely
model responses to natural disasters, accelerate detection of fraud in social programs, and more
efficiently manage transportation systems.

Relevance of quantum computing across government segments

Infrastructure Revenue, tax,

and citizen Social and customs Public safety Defense and
services programs management Education and justice intelligence

Emergency preparedness and response

Optimizing transport systems
Detecting fraud in social programs
Next-gen predictive maintenance
Accelerating scientific discovery
Quantum decryption for national security

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 Use case

Emergency preparedness
and response

Climate change has prompted more frequent and severe hurricanes and tornadoes, increased the
range of infectious diseases, and produced more parched land susceptible to fires. 3.7 million homes
in the US are at risk from wildfires,127 and the situation is worsening. In the US, risks of very large
fires could increase by sixfold by midcentury.128 Coastal regions have their own issues, with experts
predicting that hurricanes will become more intense.129

Emergency preparedness and response — essentially, saving citizen compensates for the weakness of the one before it.130 Finding an
lives — is one of the most essential government functions. The optimal composition of weak learners by accelerating integer pro-
August 2023 wildfires in Maui serve as a tragic reminder of this gramming is one area where quantum computers may be helpful.
growing threat to humanity. Response planning for wildfires
requires analyzing both current status as well as how a wildfire Image analysis can be assisted by pixel labels, which identify the
evolves in response to specific actions (for example, digging function roles of pixels in an image in both static and dynamic
firebreaks or dispersing fire retardants) and natural conditions contexts. This maps onto an energy minimization problem that
such as wind and rain. can be expressed as quadratic unconstrained binary optimizations
(QUBOs), addressable with quantum computing. And for scheduling
This type of scenario analysis requires machine learning to analyze assets in time and space, a quadratic assignment problem can be
imagery for features of interest, and optimization to determine best a starting point.
courses of action. Accelerating such computations may enable
response planners to analyze a broader range of scenarios more Quantum computing can have distinct advantages over classical
rapidly, and this is where quantum computing comes into play. computing, accelerating computations at the core of these scenario
analyses and providing planners with more timely insights on the
For example, one challenge is to combine imagery and field studies expected outcomes of different courses of action. For example,
and determine what is likely to burn. As a rule, this is not a domain Tokyo-based Sigma-I utilized a quantum cloud to develop evacua-
with extensive, statistically high-powered historical data. In tion routes in the event of a tsunami.131 In the case of wildfires, the
addition, performing classifications with computers that are weak benefits could be immense: even a 1% improvement in US response
learners is daunting. In boosting, a random sample of data is could help prevent as much as $2 billion in economic loss.132
selected, fitted with a model, and trained sequentially. Each model

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Use case

Optimizing
transport systems

As global populations and economies grow, transportation infrastructure is strained, sometimes to the
breaking point. The United Nations estimates a global population of 9.7 billion by 2050, an increase of
21%.133 Considering that from 1980 to 2000, 1.2 vehicles were purchased for every person added to the
global population, a future of increasingly overcrowded roads, congestion, and delays is imminent.134 In
fact, traffic jams cause annual productivity losses of $121 billion in the US economy.135

Routing the movement of passenger and cargo traffic is a complex signal timing optimization can be managed in various linear
motion planning task currently limited by the computational power programming frameworks, collecting another class of energy
of classical computers. But that is poised to change. For example, minimization problems for quantum computers with quadratic
traffic control could someday see innovations such as millions of unconstrained binary optimization (QUBO)-like structures.
sensors embedded in roads — with those sensors connected to
quantum computers. These computers could adjust each traffic In 2023, IBM embarked on an engagement with a large provincial
light second by second, reducing backups.136 transport agency. IBM is providing enablement materials and per-
sonalized coaching to help the agency build its internal knowledge
Quantum computers may improve optimization of complex routing and capability around quantum computing. Education ranges from
tasks, reducing vehicle idle times, minimizing delays, decreasing general quantum computing education for a business audience as
pollution, and cutting energy waste. How? By accelerating the well as more detailed technical enablement. Ultimately, IBM will
optimization computations that direct transportation systems. This help the agency select a use case and assist with building out a live
can help to reduce congestion and improve commutes for citizens proof of concept.137
and visitors.
Engagements like these have immense potential, because even
For example, route selection can be performed as an energy minimal progress reaps big results. For example, in the US, every
minimization formulation, potentially addressed with a Quantum 1% in improvement in traffic routing efficiency gains $1.2 billion
Approximate Optimization Algorithm (QAOA). Flow prediction maps in annual productivity.138
may be improved with Quantum Amplitude Estimation (QAE). Traffic

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 Use case

Detecting fraud in
social programs

Many of the applications emerging from quantum technology to

solve financial problems — particularly those dealing with uncertainty
and constrained optimization — can prove essential to governments
in detecting fraud and criminal activity and managing risk.

As national populations grow and age, the burdens placed on gov- Fraud detection with quantum computing can be useful, specifically in
ernment-provided social services will increase. Already, in the US, feature engineering — the process of extracting characteristics, prop-
Medicare, Medicaid, and the Children’s Health Insurance Program erties, and attributes from raw data141 — and classifier development.
(CHIP) have a combined annual expenditure of $1.07 trillion.139 The Quantum Approximate Optimization Algorithm (QAOA) — a hybrid
quantum-classical algorithm, is expected to garner better approximate
In addition to addressing challenges in scaling capability to meet solutions than any existing classical algorithm.142 And classifier devel-
increased demand for services, governments are faced with opment can potentially benefit from quantum information processing.
another critical issue: fraud. The financial impact of fraud to
governments and the constituents they serve is massive, with the Overall, quantum computing can enhance the sustainability of social
cost to Medicare and Medicaid alone a whopping $100 billion.140 programs with quantum-enhanced machine learning — and gain an
This drives costs up significantly, yet detection is difficult because advantage over a purely classical computing approach. The savings are
of the sheer volume of transactions. impressive: for every 1% increase in fraud mitigation rate for Medicare
and Medicaid, the programs recoup $1 billion.143
Quantum computing can help facilitate sustainable social programs
through mitigation of fraud — enabling these social programs to
better focus on the health and well-being of beneficiaries.

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Quantum computing applications

Healthcare

Healthcare data — such as information from clinical trials, disease registries, electronic health
records (EHRs), and medical devices — is growing at a compound annual growth rate of 36%.144 Quantum computing
Increasingly, this data helps address challenges associated with the “quadruple aim” of healthcare: use cases for healthcare
better health, lower costs, enhanced patient experiences, and improved healthcare practitioner
work lives.145 At the same time, healthcare consumers are making more decisions and have to
navigate an increasingly complex system.
Precision
medicine
Significant investments are being made to deliver the right data and powerful insights at the point
of care. Industry incumbents and new entrants alike are trying to create digital experiences that
reinforce healthy, preventive behaviors. Despite that, accounting for the exponential possibilities
from this diversity of new data is stretching the capabilities of classical computing systems.

Quantum computing has the potential to provide both more computing power and speed. However,
it necessitates a different way of thinking, a new and highly sought-after set of skills, distinct IT
architectures, and novel corporate strategies. The technology also has immediate implications for
security.146 Security is an area of particular relevance for healthcare, given the sector’s data privacy Diagnostic Insurance
responsibilities and challenges. assistance premiums
and pricing
In healthcare, as in other industries, using quantum computers in concert with classical computers
is likely to bestow substantial advantages that classical computing alone cannot deliver. As a result,
there is now a race toward quantum applications.

Three key potential quantum computing use cases are central to the healthcare industry’s ongoing
transformation: diagnostic assistance, insurance premiums and pricing, and precision medicine.

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 Use case

Diagnostic
assistance

One challenge is the classification of cells based on their many

Early, accurate, and efficient diagnoses usually engender better physical and biochemical characteristics. These cause the feature
space, that is, the abstract space in which the predictor variables
outcomes and lower treatment costs. For example, survival rates
live, to be large (high dimensional). Such classification is important,
increase by a factor of 9 and treatment costs decrease by a factor
for example, in distinguishing cancerous from normal cells.
of 4 when colon cancer is diagnosed early.147 At the same time, for
Quantum-enhanced machine learning approaches, such as quantum
a wide range of conditions, current diagnostics are complex and
support vector machines, may enhance classification and could
costly.148 Even once a diagnosis has been established, estimates
boost single-cell diagnostic methods.
suggest that it is wrong in 5 to 20% of cases.149

Moreover, discovering and characterizing biomarkers may necessitate

analysis of complex “-omics” data sets, such as genomics, trans-
criptomics, proteomics, and metabolomics.152 These can entail a
Medical imaging techniques, such as CT, MRI, and X-ray scans, large feature space, as well as many interacting features leading to
have become a crucial diagnostic tool for practitioners over the interdependencies, correlations, and patterns that are challenging
last century. Computer-aided detection and diagnosis methods to find with traditional computational methods.153 Further extending
for medical images have been rapidly developing. At the same biomarker insights down to the level of the individual naturally
time, many of these images are impacted by noise, poor resolu- requires even more advanced modeling. These characteristics
tion, and low replicability. suggest that quantum computing could help discover biomarkers,
perhaps even for individuals.
One of the reasons for these challenges is the need to adhere to
strict safety protocols. Quantum computing has the potential to Through quantum computing, care providers may be able to improve
improve the analysis of medical images, including processing diagnoses while simultaneously eliminating the need for repetitive
steps, such as edge detection and image matching. These improve- invasive diagnostic testing. They may be able to continuously monitor
ments would considerably enhance image-aided diagnostics. and analyze the health of individuals. In addition to helping patients,
such improvements could also benefit health plans and providers
Furthermore, modern diagnostic procedures may include via reduced treatment costs as a result of earlier diagnoses. It might
single-cell methods.150 In particular, flow cytometry and single- even become possible to carry out meta-analyses for more elaborate
cell sequencing data typically require advanced analytical diagnostic procedures in order to determine which procedure should
methods, especially when considering combining data sets be performed and when. This could help further cut costs and enable
from the different techniques.151 more data-driven decisions by health plans and governments for
providers and individuals.

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Use case

Insurance premiums
and pricing

Another important lever through which quantum computing may

Determining health insurance premiums is a complex process. A support pricing decisions is enhanced fraud detection. Currently,
healthcare fraud costs hundreds of billions of dollars in the
number of factors need to be taken into account by a health plan
US alone.156 Classical data mining techniques already help with
in the process of developing a general pricing strategy (recognizing
detecting and reducing healthcare fraud; nevertheless, more
that regulations in some countries, such as the US, may limit the
computationally efficient methods are needed.157 Quantum algo-
number of factors used to calculate premiums).154
rithms could enable superior classification and pattern detection
and thus help uncover anomalous behavior and eliminate fraudu-
lent medical claims.158 This is expected to allow health plans to
further optimize pricing strategies and offer reduced premiums
These include complex interdependencies, such as population as a result of having lower costs associated with fraud loss and
health levels and disease risks, treatment suitability and costs, prevention schemes.
and the risk exposure a health plan is willing and able to accept
based on corporate strategy and regulations. While health plans Enhanced pricing computations would enable lower average pre-
have already made considerable progress in this space by miums as well as better-tailored premium options. The complexity
applying classical data science methods, achieving more granular of healthcare is reflected in the challenges associated with making
models with lower uncertainties remains difficult. pricing strategies easily understood. New regulations that require
transparency and lower average healthcare costs make it even
One key area in which quantum computing may help optimize more important to optimize pricing models.159
pricing is risk analysis. Leveraging insights about disease risk
at the population level and combining them with quantum risk
models that can compute financial risk more efficiently could
allow health plans to achieve improved risk and pricing models.155

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 Use case

Precision
medicine

Precision medicine aims to tailor prevention and treatment approaches to the individual.160
Due to the complexity of human biology, individualized medicine requires taking into
account aspects that go well beyond standard medical care.

In fact, medical care only has a relative contribution of 10% to 20% to outcomes; health-related
behaviors, socioeconomic factors, and environmental aspects account for the other 80 to 90%.161
Computationally, the interdependencies and correlations among these diverse contributors create
formidable challenges with regard to optimizing treatment effectiveness.

As a result, many existing therapies fail to achieve their intended effects due to individual variability. For
example, only a third of patients respond to drug-based cancer therapies. In some cases, consequences
of drug therapies can be disastrous; in Europe alone, up to 200,000 people die each year due to
adverse drug reactions.162

A key aspect of tailoring medical approaches is proactivity. As mentioned, early treatments and
preventive interventions tend to drastically improve outcomes and optimize costs. Classical machine
learning has already shown some promise in predicting the risk of future diseases for a range of patient
groups based on EHRs. Nevertheless, challenges remain due to the characteristics of EHRs163 and other
health-relevant data, including the level of noise, size of the relevant feature space, and complexity
of interactions among the features. This suggests supervised and unsupervised quantum-enhanced
machine learning techniques could allow earlier, more accurate, and more granular risk predictions.164
Eventually, medical practitioners might even have the tools to understand how an individual’s risk for
any given condition changes over time, enabled by continual virtual diagnostics based on ongoing data
streams from individuals.

Knowing an individual’s disease risk is not sufficient, however. Just as important is knowing how to
effectively medically intervene for any given individual. One avenue in this endeavor is the study of drug
sensitivity at the cellular level. For example, by taking into account the genomic features of cancer cells
and the chemical properties of drugs, models that can predict the effectiveness of cancer drugs at a
granular level are already being investigated.165 Quantum-enhanced machine learning could support
further breakthroughs in this area and ultimately enable causal inference models for drugs.

126
 The goal of precision medicine is lofty: identifying and explaining relationships among interventions
and treatments on the one hand and outcomes on the other to provide the next-best medical action at
the individual level. Traditionally, diagnosing a patient’s condition has been based heavily on patient-
reported symptoms, which is time consuming and results in an umbrella diagnosis and associated
treatment that frequently fail.

We are now moving toward a setting where insights from additional health-relevant data can be obtained
to efficiently arrive at a continuous and precise health status, along with personalized interventions (see
Figure 19). While we are still a long way from realizing this, quantum computing may be able to accelerate
our progress toward such a new framework.

This framework would allow healthcare organizations to optimize and personalize their services through-
out the continuum of care. Moreover, adherence and patient engagement are also key considerations in
decisions about the next-best medical action for a given individual. Advanced computational modeling
can address this area too.166 For instance, adherence data analysis allows the timing of interventions
to be optimized for individuals.167 Eventually, population health management at this level of granularity
could become possible.168

FIGURE 19

Quantum computing has Umbrella approach Precision-based approach

the potential to accelerate
the transition Patient-reported symptoms Many factors
from umbrella diagnosis and
treatment to precision health
status intervention.

Umbrella diagnosis Granular health status

Umbrella treatment Precise intervention

127
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Quantum computing applications

Insurance

Insurers worldwide are navigating increasing pressure to remain competitive and differentiated in
the face of rapid technological innovation and higher macroeconomic volatility. Sophisticated mod- Quantum computing
eling and computational techniques are needed at an unprecedented scale to make sound business use cases for insurance
decisions, but many of the underlying problems remain intractable and elusive today. Quantum
computing has the potential to pave the way toward finding solutions that even supercomputers
Catastrophe
will be unable to match.
and mortality
projection
Across insurance domains, underwriters are assessing a wider range of risks using real-world and
real-time data from sources such as sophisticated AI platforms and distributed sensors. Insurers
require products and marketing strategies that are more precisely targeted to customer needs
while maintaining the ability to price them accurately, fairly, and in an explanatory way.

Traditional pricing methods lack the ability to respond quickly to changing market conditions
and to easily incorporate non-technical pricing factors. AI-based pricing models are expected to
greatly reduce the time required to introduce new pricing frameworks—including more flexible
usage-based models—condensing time-to-market from months to weeks.169 Customer Risk
and risk concentration
Risk management is another challenge. Insurers require improved tools to study and balance risk classification analysis

concentrations, attain efficient capital allocation, and satisfy regulatory compliance demands. With
ever-growing data inputs and constraints, the precise modeling of large-scale risks and catastrophic
event fallouts are large computational challenges.

Quantum computing is well positioned to create new value in the computationally intensive oper-
ations that insurance companies perform across the core business functions of underwriting, risk,
claims, and wealth. Quantum machine learning, optimization, and linear algebraic techniques may
be integrated into conventional workstreams to begin to harness greater computational scale and
to obtain more accurate results. As well, quantum computing excels at finding patterns in data
generated by AI—the two technologies are complementary.170

By applying quantum computing, insurers can expect to embrace the risk-related innovations of the 21st
century. We will explore three potential use cases: customer and risk classification, risk concentration
analysis, and catastrophe and mortality projection.

129
 Use case

Customer and
risk classification

Underwriters have traditionally profiled customers and associated risks based on demographic
categories that are easily traceable, while potentially missing deeper explanatory factors and creating
risk gaps. Marketers of insurance products typically have sparse and incomplete data to leverage in
deciding how to appeal to consumers to purchase risk-related products.

By taking into account more granular risks, insurers can promote Today, these insights are not easily discoverable with compute-
the discovery of new underwriting and rating criteria for products. intensive approaches due to the complexity of factors in which
Higher precision in underwriting and pricing processes can lead to patterns need to be found. Simple heuristics are insufficient to
better risk allocation and improved combined ratios. More person- adequately capture a complete picture of the relevant risk factors.
alized offers can also speed up the onboarding process and fuel
more sales. Insurers are already planning to invest heavily in AI, Quantum machine learning techniques may potentially result in
with 55% of insurance CEOs naming AI as a core technology that faster data training, provide more precision in classification and
will help them drive business results.171 regression tasks, and allow computation with greater feature
counts. Quantum machine learning employs a hybrid classical and
By combining AI tools with quantum technology, insurers can quantum approach to fundamental computations in AI; it combines
vie for new customers more effectively. They can employ more the best of both computing worlds in game-changing workflows
sophisticated and flexible pricing models and marketing strategies that can bring compelling new products to the marketplace.
that address the precise risk needs and appetites of potential
customers.172 Insurers could capture more risk elements from higher-definition
data, identify new target micro-segments, and go to market with
Quantum machine learning techniques can be applied to create products that are engineered to enhance lifetime customer value
more efficient and accurate data maps from sparse, loosely but are tough to emulate by competitors.
related data in order to find compelling new insights and correla-
tions. Quantum algorithms may provide greater precision around
classification results and more reliably determine the influence of
individual rating features.

130
Use case

Risk concentration
analysis

Customers are constantly searching for personalized policies that will satisfy their needs of today and
tomorrow. Insurers are motivated to sell policies that are matched to the insured’s lifestyle, ambitions,
and emotional state, with appropriate riders. Due to regulatory constraints, current pricing models are
largely static; this creates difficulties, particularly in making timely adjustments that prevent high-risk
markets from generating excess reserving pressure. Furthermore, managing marketing efforts to attract
profitable and accurately priced new business is operationally complex.

A complete model balancing risk pricing, book of business concen- Quantum optimization techniques can potentially solve complex
tration, and distribution dynamics may improve risk management optimization problems relating to policy design, pricing, and risk
across the entire book. More advanced AI tools will result in better concentration. Certain kinds of problems may potentially result in a
policy or rider recommendations and cross-sell opportunities that quadratic computational speed-up or better. Quantum optimization
improve the competitiveness and sustainability of the business. techniques may be able to solve many problems that consume too
The go-to-market strategy may be continuously adjusted. many classical computing resources to otherwise even attempt.
They may also improve the solution iteratively to discover a near-
With better modeling, agents and distributors will receive more optimal solution with higher confidence than can be attained today.
support for writing new business on more relevant and effective
products. The use of data analytics has the potential to improve It is expected that increased sales and profits could follow when
customer revenue by as much as 60%.173 More granular pricing applying quantum techniques to optimizing product configurations,
models based on improved statistical modeling may result in finding profitable and compliant pricing models, and formulating
customers being better able to tailor solutions to their needs.174 desired risk concentrations across the business.

Risk concentration can grow increasingly problematic over time if

insufficiently addressed; it can potentially result in overexposure
and difficult market withdrawals to correct. Policy design is chal-
lenging due to limited information from clients, the complexity of
features and riders at disposal, and the difficulty of conveying risk
in an understandable way to a customer.

131
 Use case

Catastrophe and
mortality protection

Insurers need to confidently ascertain the total risk exposure of their book of business and forecast
the likelihood and consequences of catastrophic losses. They must assess nonstop changes in under-
lying risk, the litigation environment, and emerging risk trends. Such impacts may be wide-ranging
and severe.

One example is the estimated global impact on gross domestic The processing of large and complex models is expected to be an
product (GDP) due to climate change: the GDP is expected to drop advantage of quantum computing. Quantum amplitude estimation
18% by 2050 if no mitigating actions are taken.175 The ability to algorithms may provide a quadratic speed-up performance advan-
correctly perform reserving based on accurate projections will tage over the counterpart Monte Carlo simulation techniques being
inform the strategies for underwriting, re-balancing of the contract performed today (in limited fashion). This could result in overnight
portfolio, and reinsurance. computations being shifted to intraday. Alternatively, the quantum
algorithm could yield more precise results than classical Monte
Risk models utilized today are compute-intensive and subject to Carlo, boosting confidence in the analysis.
significant drift within the constantly changing risk environment.
Notable risks range from climate and health threats, and resulting The computational advantage expected from quantum computing
damage and interruption to business, to societal changes stemming will enable risk scenario planning to occur more often and to yield
from technological progress. The adjustment of these models more accurate results than ever before. Better outputs will result in
may need to rely upon large pools of data from disparate sources, more efficient capital allocation, higher optimization of asset port-
including the Internet of Things. It is usually too time-consuming folio risk, and higher confidence in the ability to meet regulatory
and costly to permit scenario analysis of such voluminous data; requirements.
the probabilities of risks and their downstream consequences can
change too quickly and unpredictably.

It is expected that catastrophe, mortality, and wealth management

modeling will be greatly aided by improvements in computational
capacity. Actuaries and analysts typically have modeling needs
requiring highly scalable computation.

132
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 Quantum computing applications

Life sciences

In life sciences, major challenges include understanding the relationships among

sequence, structure, and function and how biopolymers interact with one another, Quantum computing
as well as with small organic molecules that are native to the body or designed as use cases for life sciences
drugs. Such problems are computationally complex and are at the heart of genomic Developing novel
analysis, drug design, and protein folding predictions. biological products
based on protein
As a result, there is now a cross-discipline race toward quantum applications. folding predictions
Within five years, it is possible quantum computing will be used extensively by new
categories of professionals and developers to solve problems once considered
unsolvable.176

Trends such as the spread of efficient low-cost sequencing and the advent of the
“-omics” era result in life sciences companies exploring ways to take advantage of
the diversity of novel data sources. Further, the life sciences industry is among those
in which people could most directly experience future quantum computing benefits.
Creating precision medicine Improving patient
Exploration and implementation of quantum computing use cases, paired with therapies by linking outcomes through
further scientific progress in quantum computing hardware and algorithms, are genomes and therapies enhancing the efficiency
expected to enable the transition from potential to reality over the coming years. of small-molecule
Quantum computing has the potential to enable a range of disruptive use cases drug discovery

in life sciences. These include:

—Creating precision medicine therapies by linking genomes and outcomes

—Improving patient outcomes through enhancing the efficiency of small-
molecule drug discovery
—Developing novel biological products based on protein folding predictions.

135
 Use case

Creating precision Classical algorithms to identify motifs are computationally expensive

because they require exhaustively searching all possible arrangements

medicine therapies
for a given length. The application of quantum optimization algorithms
could further our understanding of transcription factor binding and
de novo genome assembly.

by linking genomes —Genome-wide association studies (GWAS):181 The goal of GWAS is

and outcomes to find associations between a selected trait or disease and single
mutations in DNA. Current methods are inherently high dimensional
and computationally challenging. This highlights the potential for
quantum computing to significantly narrow the lists of candidate genes
that need to be experimentally validated. Quantum computing may
The 15-year, $2.7 billion investment to accurately sequence also enable progress in gene network and graph models.
the human genome and subsequent reductions in sequencing
costs helped launch the “-omics” era.177 Accordingly, understanding —De novo structure prediction:182 With the explosive growth of sequencing
primary sequences is no longer a major limitation for scientists. information and technology, an increasing gap exists in understanding
how sequence translates to structure and, ultimately, function (see
Figure 20). Despite sophisticated methods, such as homology models,
classical approaches to predict structure de novo often scale poorly.183
For instance, the search space of potential protein configurations
Instead, research focus has shifted to taking advantage of new increases exponentially with the size of a protein, making brute-force
computational tools to deepen our understanding of how genomic approaches infeasible. Quantum computing has the potential to
sequences translate to function. However, this task is extremely drastically improve structure predictions for RNA molecules, proteins,
difficult with traditional methods due to the size of the human DNA-protein complexes, and other constructs.
genome (about 3 billion DNA base pairs), the variation that exists
across populations, and the wide range of health outcomes.178 Such advances could eventually help realize the vision of powerful
digital twin models.184 Organic digital twins might be used in pharma-
Potential opportunities at the intersection of genomics and cogenomic testing to predict an individual’s response to specific drugs
quantum computing include:179 over time, aiding the development of precision medicine therapies.
Additional inorganic digital twins could be created to optimize research
—Motif discovery and prediction:180 DNA, RNA, and amino acid or care facilities by comparatively stress-testing aspects such as
sequences have all been shaped through evolutionary pressures. procedures, staffing levels, facility layout, and equipment. Reaching the
One bioinformatic challenge is identifying motifs in these sequenc- day when a medical team can tell a patient, “Based on your genome,
es, such as patterns that activate or inhibit gene expression and, we have confidence that this will be the specific result of your treat-
thereby, help us better understand mechanisms of gene regulation. ment,” may no longer seem like a purely utopian goal.

FIGURE 20

Sequence-structure-
Sequence Structure Function
function dogma
at the heart of
biology research
Toxic
compound

Protein
subunits Changes
direction
Cell
membrane

136
Use case

Improving patient outcomes

by enhancing the efficiency of
small-molecule drug discovery

Small-molecule drug design and discovery has always been a complex optimization process. Its goal:
improving patient outcomes by designing a novel molecule active against the disease-related target
while simultaneously reducing activity against the thousands of other targets in the body to avoid side
effects and dangerous toxicities.

In pursuit of this goal, typically 200,000 to >106 compounds are The ability to study more potentially pharmacologically active
screened in experimental and computational workflows, and a molecules, beyond the roughly 107 organic and inorganic sub-
few thousand are produced and tested in the necessary battery of stances that have been reported in the scientific literature to date,
assays.185 Here, computing has long played a role, largely through is important. In fact, the total number of possible carbon-based
similarity and classification approaches to support screening and compounds whose molecular masses are similar to those of living
detailed 3D structure, as well as energy calculations to support systems is around 1060.187 There are thus many orders of magni-
more precise target-based design. tude of uncharted chemical space left to explore, clearly an area of
great potential. This opens the door, for instance, to better assess-
Quantum computing has a diversity of potential applications in ing ultra-large libraries of small organic molecules now available
drug discovery.186 The technology could help assess a greater num- for purchase with synthesis “on demand.”188
ber of candidate molecules and evaluate them more accurately
using, for example, classification methods such as those employed Particularly accurate scoring is possible through molecular dynam-
in lead-finding and off-target screening. And it may impact the ics simulations of protein-ligand complexes. Here, quantum com-
classification associated with lead-finding and the modeling of puting could offer significant advantages for carrying out hybrid
off-targets in lead optimization — as well as with the physics-based quantum/molecular mechanics approaches as well as developing
modeling carried out in lead optimization when a 3D protein struc- the underlying parameters of the classical force field. Such ad-
ture or good model is available. vances would apply to both lead optimization and the growing field
of computational process chemistry, such as in modeling enzymat-
ic reactivity and stereoselectivity to support biocatalysis in drug
manufacturing.189

137
 Use case

Developing novel While many proteins can be modeled adequately by analogy to

known structures, an important and challenging design target is the

biological products
hypervariable H3 loop in the complementarity-determining region
of antibodies. This loop typically contains 3–20 residues but is
sometimes much longer, and accurate representation has been

based on protein the subject of much study.195

folding predictions Quantum computing has the potential to overcome many of these
computational challenges — for example, scoring the great number
of possible structures and identifying the likeliest one. A recent
publication demonstrated that quantum computing could score a
peptide in two common conformations represented on a lattice —
In contrast to small-molecule drugs, in the case of biologics, a alpha helix and beta sheet — and leveraged a quantum algorithm for
protein or other macromolecule is the drug. Biological drugs, such the search.196 It has also been shown that quantum computing
as antibodies, insulin, and many vaccines, have been employed may drastically improve the calculation of protein force fields.197
for decades.190 In recent years, pharmaceutical companies are As Quantum Volume increases, quantum computing’s ability to
increasingly targeting biologics to treat a number of diseases. score additional conformations will increase accordingly.198 Recent
Designing the 3D structure of biologics is important for function, progress in predicting protein structure with classical deep-learning
specificity, and stability.191 networks suggests that quantum algorithms may be particularly
valuable when polypeptides with unnatural amino acids are studied,
where suitable machine learning training data is quite limited.199

Finally, as with all the potential quantum applications previously

Real-world protein modeling cases involve exploration of the discussed, quantum computing could enable further use cases in
enormous number of possible folding patterns, as illustrated in tangential areas. For instance, biologics tend to be much less stable
Levinthal’s paradox (see Figure 21).192 The exponential growth of than small-molecule drugs. Optimization of the biologics supply
potential conformations with chain length makes the problem chal- chain itself — from formulation through shipment and, ultimately,
lenging for classical computers. For example, in one model, a chain transport to pharmacies, hospitals, and even homes — is a complicated
of 20 amino acids has 109 potential conformations, and chains with process that also may be improved by quantum computing.200
60 and 100 amino acids have 1028 and 1047 conformations, respec-
tively.193 Moreover, as part of the US Food and Drug Administration’s
biological product definition, a protein must comprise more than 40
amino acids.194

FIGURE 21

Levinthal’s paradox
Even a protein with only
100 amino acids has
NH around 1047 potential
Tyr
Gly
Phe conformations. In reality,
Leu
Arg however, many proteins
Amino acid
sequence Ile fold to their native
Arg structure within seconds.
Pro
Lys
Leu

138
139
140
Quantum computing applications

Logistics

In the age of globalization and international trade, effectively managing transpor-

tation and logistics is vital to the health of the economy and society in general. As Quantum computing
events surrounding the COVID-19 pandemic illustrated, logistical disruptions can use cases for logistics
have catastrophic impacts on both business-to-business operations and consumer
behavior. In today’s interconnected digitized world, logistics and supply chain
Disruption
strategies are perhaps more important than ever—and more complex.
management

Before the pandemic, the average consumer didn’t think much about how the
products they used or foods they ate were transported—they just took it for granted
that grocery shelves were replenished and everything they wanted was already
available. Now, “supply chain” is common vernacular and stories of disruption
dominate news cycles as capacity shortages, rising transport costs, and the accel-
eration of online commerce continue to pose challenges.

The overall goal of a logistics enterprise is optimized operations at all times—

a tall order that is easier said than done. Even during times of more stability, Last mile Sustainable
logistics management is a complex discipline, involving a network of moving parts delivery maritime
and systems ranging from logistics planning, to manufacturing and supply, storage routing
and distribution, and transportation/shipping.

Organizations rely on logistics optimization models to help them reduce overall

costs while satisfying capacity constraints and meeting demand through effective
procurement, production, storage, distribution, and transportation. And the
more information involved in the logistics equation, the better. More information,
however, also means more complex models that require exponential increases
in computing power. Today’s logistics providers are facing complexities that push
the limits of their technologies. At scale, these problems are challenging to solve
with only classical computing technologies.

Quantum computing could evolve into a powerful tool to help tackle some of
today’s biggest challenges related to transportation and logistics. Pairing quantum
computing capabilities with classical computers could help organizations address
a number of critical logistics challenges. We explore three potential use cases: last
mile delivery, disruption management, and sustainable maritime routing.

141
 Use case

Last mile
delivery

As customer expectations for speedy omnichannel fulfillment continue to increase, optimization of

multimodal transportation, particularly the last mile, is a must. One of the hottest topics in global
logistics, last mile delivery represents an enormous competitive opportunity, buoyed by the meteoric
growth of e-commerce. Valued at $40.7 billion in 2022, the last-mile-delivery market is projected to
grow to $86.2 billion by 2032.201

Arguably the most expensive and challenging step of the supply optimization problems grows exponentially in complexity with
chain, last mile delivery has only gotten trickier amidst current the size of the input. This leads to solutions with high optimality
disruption. The pandemic further propelled the rise of e-commerce. gaps (the gap between an approximate solution and the optimal
Shifting consumption habits and unpredictable demands are solution) and long runtimes — and illustrates the limitations of
increasingly commonplace. The ability to pivot quickly is crucial to classical computing.
meet consumer delivery expectations. However, current systems
remain fragmented and static, able to conduct only limited optimi- Research indicates quantum algorithms have the potential to solve
zations for large scale logistics networks. larger, more complex logistics problems.203 These algorithms could
support more efficient searches of the solutions landscape, opening
To highlight the scale and complexities involved, consider that in the door to discovery of more profitable delivery routes and better
2021, the global daily average delivery volume for UPS was 25.2 fleet management.
million packages.202 Optimization models of this size push the limits
of classical computing and, at the same time, point toward oppor- By supporting global routing optimization and more frequent
tunities for quantum computing. re-optimization, quantum computers could help significantly reduce
door-to-door freight transportation costs, as well as boost customer
Classical last mile delivery solutions are based on heuristics and satisfaction. Progress in last-mile delivery could be game-changing
have limited inputs. Responding to frequent changes and demand for the logistics industry: Even a 1% performance improvement could
shifts is difficult and slow. The state space of many last mile delivery lead to an annual $400 million in savings worldwide.204

142
Use case

Disruption
management

While the COVID-19 pandemic delivered a violent shock to global

supply chains, it represented but one in a long history—and it
certainly will not be the last. The ability to rapidly and efficiently
respond to and manage disruptive events will remain critical
for logistics enterprises.

Leaders responded to disruption by building intelligence and agility numerous elements and dependencies can generate an enormous
into their supply chains, in a quest for radically improved perfor- number of disruption scenarios. However, current simulations
mance and resilience. Data-led solutions are key to this shift; 73% typically try to find only the most feasible scenarios rather than
of leaders say they recognize the strategic value of data and 64% considering all of the components.
are using data to identify new opportunities.205
Quantum computing could support better decision-making by simulat-
The ability to more accurately simulate the impacts of logistics ing more disruption scenarios and quantifying their impact on various
disruptions is crucial, leading to more rapid responses and shorter parts of the network. Quantum computers performing risk and impact
recovery times. However, the complexities of managing international analysis may be able to reduce the number of “what if” simulation
fleets of planes, trains, ships, and trucks and serving millions of scenarios necessary to achieve conversion to the best result within
businesses and consumers stretch the limits of current disruption actionable time windows. This could help improve recovery times,
management systems. lower costs, and lessen operational and customer service impacts.
In addition, quantum machine learning may enable more precise
Classical systems are mainly rule-based, consisting of manual classification and prediction of disruption events.
and ad hoc processes. Siloed and sequential, they provide limited
insight for supporting flawless recovery decisions. They deal with Improvements in disruption management could be transformational
personnel, equipment, and materials separately in a suboptimal for transportation and logistics, as well as help reduce the $184
manner. System-wide recovery can take anywhere from a week to million, on average, lost globally due to supply chain disruptions.206
more than two months. In addition, complex environments with

143
 Use case

Sustainable
maritime routing

With 90% of the world’s trade volume traveling by sea,207 optimizing container shipping is an essential
priority for maritime logistics. Elevated shipping rates over the past two years made global container
shipping a $150 billion market.208 Due to imbalances in global trade, many containers are shipped
empty, a practice that is becoming increasingly expensive. For example, shipping a 40-foot container
from Asia to Europe costs between $15,000 and $20,000, compared with $2,000 in 2019.209

The classical approach to container shipping operations is a mix of human intuition and ad hoc optimi-
zation solutions. Although simulation modeling is employed at some ports and terminals, solutions are
often local and use limited data inputs. Due to a lack of data insights, many container shipping decisions
are made based on “instinct.”

With contingencies that include large fleets and uncertainties such as weather and demand fluctuations,
many optimization challenges in shipping operations can’t be precisely solved exactly using classical
computers. Producing a useful solution, even for a small-scale problem, takes many hours.210

However, quantum algorithms may enable more accurate modeling. More precise demand forecasting
and better inventory routing on a global scale could enable more streamlined—and sustainable—maritime
operations.211 In addition to addressing societal demands for improved air quality and reduced carbon
emissions, container repositioning improvements could save millions of dollars a year.212

144
145
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153
 The Quantum Decade
A playbook for achieving awareness,
readiness, and advantage

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154
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