When MOD Pizza opened in 2008, customers had a chance to get a taste of something different. MOD, which stands for “Made on Demand,” offers customizable, artisan pizzas, giving customers a choice of more than 40 toppings with various sauces, and customizable salads —delivered superfast.

MOD in America

But pizza (and salads) alone isn’t what separates the Seattle-based chain from the competition and has made it a rapidly growing success. It now has more than 500 system-wide locations throughout the country. 

Two other factors, in addition to its high-quality, personalized products, set MOD Pizza apart from the crowd. The first is a unique pricing strategy. The size of the pizza and not the number of toppings determines the price. So, no matter how many toppings you want, the price is the same for the size you choose. 

The second factor has proven to be an essential ingredient for success: the human factor. Without dedicated, customer-focused employees, even a restaurant known for its cuisine can be difficult to stomach if the service is poor. Happy employees equal happy customers. In 2015, Fortune Magazine named MOD Pizza “one of the 20 Best Workplaces in Retail in the entire US.”

“For MOD Pizza, providing exceptional employee experiences is key to driving workforce engagement and business success,” says Tara Gambill, senior director of enterprise systems for MOD. And to help maintain those exceptional experiences, MOD Pizza added to its business recipe SAP solutions, including SAP SuccessFactors and SAP S/4HANA Cloud, public edition.

Keeping up with the MOD Squad 

MOD Pizza has more than 10,000 employees, known as the “MOD Squad” (perhaps influenced by the 1968 TV series of the same name – you remember, the one with Linc, Julie, and Pete.) That works out to hundreds of MOD Squad events occurring every day such as hires, transfers, promotions, and separations, generating a lot of data. 

With the chain’s rapid growth, its legacy technology couldn’t keep up. Data was entered manually, which, in some cases, led to inconsistencies and errors and slowed down operations. The company’s enterprise resource planning (ERP) and human resources (HR) systems weren’t integrated, creating information silos. Recruiting and onboarding processes were cumbersome. Those issues and more affected the business efficiency and MOD Squad experience.  

Cooking with SAP

MOD Pizza was looking for a solution to efficiently automate, accelerate, and connect the company’s HR and ERP processes and scale. SAP delivered with SAP SuccessFactors (for HR) and SAP S/4HANA Cloud, public edition (for ERP). SAP Business Technology Platform (BTP) provides the scalable foundation for the company’s digital transformation, and SAP Master Data Integration enables accurate data to be available enterprise wide.

MOD has also employed Qualtrics Experience Management solutions to capture employee feedback and refine recruiting and onboarding processes.

“The ability of SAP SuccessFactors and S/4HANA Cloud, public edition to handle our HR and back-office ERP needs in a scalable and powerful way allows us to leverage an intelligent core and weave all of our end-to-end processes together,” says Tara.

MOD managers can now focus on partnering with their teams instead of being overwhelmed with time-consuming HR and finance processes. “Bringing in this single, cloud-based platform to manage all these activities is a game-changer for MOD,” says Tara.

Out of the oven — automating and integrating

Today, back-of-the-house systems and capabilities – including ordering, inventory, labor management/scheduling, repair, and maintenance costs – are integrated into SAP S/4HANA Cloud, public edition, for seamless operation. 

Hiring and onboarding are frictionless and accelerated to help new employees report to work faster and easier. Up to 1,000 new hires are onboarded each month. 

SAP solutions help MOD Pizza manage 400 event data changes daily. By avoiding manual data entry, the chain saves labor – more than 15 hours a week – and eliminates errors. 

It all adds up to a recipe for ongoing success and happiness – for the MOD Squad, the squad’s pizza home, and MOD customers. For its accomplishments, MOD Pizza has been named a winner in the Experience Wizard category in the 2023 SAP Innovation Awards, which is celebrating its 10th anniversary.

To learn more about MOD Pizza’s Innovation Awards recipe for success, check out their Innovation Awards pitch deck.

Digital Transformation

The room was abuzz. People were standing, talking intensely, mingling, and meeting new people. This was our first in-person conference in 2023, and it was going exactly as planned: Participants were engaged and networking. In all of our surveys, networking is always one of the top two reasons attendees come to our events (the other is the content), but often we don’t see them doing it. So we’d put a structured networking exercise on the agenda, introduced the session, and presented some sample questions they could use as conversation starters. Voila – off they went. Later, our survey results indicated it was a highlight of the event.

Welcome to FutureIT, our new event brand debuting in five cities in 2023. We’ve focused on leveraging what’s special and important about meeting in person again, with keen attention paid to creating the best – and a memorable — attendee experience. A fresh take on content, networking and experiences means it’s not your father’s IT event – as one attendee enthusiastically told us.

That’s right. Our focus covers three areas: leadership, technology and personal development. The program starts with a workshop to heed the call of deeper learning, networking and personal growth;  features an inspirational, non-endemic keynote, followed by interviews with and panels of exceptional CIOs; and includes not just the aforementioned structured networking but active discussion groups led by our sponsors.

The program also features content aimed at attendees’ careers, by looking at the latest job requirements for senior IT and security executives. This session includes information that will help managers recruit for open positions – a big pain point across so many and IT security teams – as well.

As such, the agenda checks all the boxes regarding what recruiters and our research indicate are the most crucial skills for success in today’s volatile business environment. Sound exciting? We have programs coming up in Washington, D.C.; Toronto; Chicago; New York; and Southern California. Join us.    

Digital Transformation, Events, IT Leadership

Signs of a tech talent shift are under way, with IT pros increasingly turning away from Silicon Valley and tech stalwarts in favor of new roles outside the technology industry.

For Andreea Bodnari and Chris Jones, both of whom left Silicon Valley tech companies to work at healthcare organization Optum, the lure was not concern over mass layoffs in big tech, but the prospect of solving real-world problems and the opportunity to work on technologies that make a difference in people’s lives.

Bodnari, who previously worked at Google, says that while the search engine giant was a great place to build core technology, it felt more meaningful to integrate healthcare with AI. UnitedHealth Group, the parent company of Optum “was the holy grail of healthcare know-how and prowess,” says Bodnari, vice president of product at Optum.

Andreea Bodnari, vice president of product, Optum

Optum

Jones, who joined Optum from Meta in November 2022 as a senior principal applied scientist, says the move meant being able to leverage his expertise in responsible AI while making a positive, real-world impact in healthcare. 

Healthcare seemed like a better place to put his expertise to use “than the slightly ephemeral stuff I was working on at Microsoft,” says Jones, who spent a decade at Microsoft prior to his time at Meta.

Chris Jones, senior principal applied scientist, Optum

Optum

That sense of purpose and yearning to do meaningful work is the ace in the hole for Optum Enterprise CTO Francois Charette, who has hired a number of Silicon Valley technologists in recent months. Charette says that in his conversations with candidates, he is struck by how they are “really looking to make an impact on people’s lives” rather than just work on cool technology, he says.

Breaking the stronghold on talent

Historically, Silicon Valley and high-tech companies have had a leg up on luring top talent in part because they provided access to advanced technology, “but now, it’s basically used everywhere, so they’ve sort of lost their edge there. They’ll have to compete for talent like everyone else,” Charette says, adding that Optum’s mission of helping people live healthier lives “resonates extremely well for folks.’

It’s not just healthcare; other “traditional” industries such as insurance, transportation, banking, pharmaceuticals, and consumer products goods are all witnessing a surge in interest from tech professionals who no longer feel the allure of working at venture capital-infused Silicon Valley startups that promised innovative and challenging tech projects. Now, with the recognition that technology fuels all businesses, they can pretty much find those opportunities at almost any company.

You don’t always find a sense of great purpose working in Silicon Valley, observes Diogo Rau, executive vice president and chief information and digital officer at Eli Lilly and Co. “Any engineer throughout history has probably been motivated in large part by the impact they can have on society,” says Rau, who joined Eli Lilly two years ago after a decade at Apple. “It’s bigger than working on interesting problems. … Engineers throughout millennia want to do something that’s bigger than themselves and can last.”

Diogo Rau, EVP and chief information and digital officer, Eli Lilly and Co.

Eli Lilly and Co.

Rau hired a former Apple colleague who approached him and was incentivized by the offer to run the software engineering team at the Indianapolis-based Lilly after hearing about the types of projects he could work on. “I can tell you he didn’t come for the weather,” Rau jokes.

Perceptions are shifting

Lately, there is more receptivity to hearing about opportunities in other sectors for positions in information security, data, engineering, and cloud, observes Craig Stephenson,managing director for the North America technology, digital, data and security officers practice at Korn Ferry.

“The savvier CIOs are certainly trying to take advantage of the disintermediation in tech and recruiting the talent,” agrees Dennis Baden, a partner in Heidrick & Struggles’ Boston office and global managing partner of the technology officers and digital officers practice.

The tide is turning because of the large volume of layoffs and because engineering talent at big tech companies is more open to being scouted by other industries, Baden says. “Some of it is their equity is down and there may not be as much of an upside to staying.” Additionally, companies in other industries are demonstrating there are interesting and complex issues to solve as technology becomes more closely aligned with business goals, he says.

“There’s a world outside big tech and [a belief] that we can solve interesting problems and build cool software,” Baden says.

There are several considerations for tech professionals when assessing new roles and first and foremost is “the notion of impact or mission,” Stephenson says. “Individuals are looking to make sure they have a role that is socially responsible and globally responsible.”

While compensation remains important, the industry a company is in has become another consideration, as well as how the role is defined, the reporting structure and career path, he says.

And despite the uncertain economy, technologists, especially those with specialized skills, are still in high demand, and “established industries” are prepared to pay for talent with the skill sets and experience they need, according to Dice’s 2023 Tech Salary Report.

“This contrast between a rapid contraction in big tech and continued digitization initiatives across key industries sets the stage for an incredibly interesting year for tech hiring and retention in 2023,” the report notes.

Traditional companies let technologists be ‘rockstars’

XPO, a large freight transportation provider that handles more than 13 million shipments every year, is moving to the cloud and has a lot of initiatives geared at how to efficiently move freight through its network. All of XPO’s technology is proprietary and built in-house and CIO Jay Silberkleit has hired a lot of developers from Silicon Valley companies.

Jay Silberkleit, CIO, XPO

XPO Logistics

“What we see is if you have fun and interesting problems and a good work culture, that incentivizes the Silicon Valley technologists to want to move into other companies,” he says. “What’s important to them, and really, to all technologists, is they like to see … that the technologies they’re creating are having an impact on the companies they work for.”

Additionally, big tech companies have gotten so large, it’s harder to make an impact, Silberkleit says.

“A lot of people are leaving these companies to go to more traditional companies where they can be rockstars and have a massive impact,” he says. “They want to prove themselves and show that tech can change a company and be a differentiator for them.”

There has been a paradigm shift, and regardless of the business unit, individuals with deep tech savvy are now required throughout organizations, says George Thomas, CIO of JLL, a global commercial real estate firm.  

George Thomas, CIO, JLL 

JLL

Another factor driving “curiosity” from Silicon Valley talent to work in traditional industries like real estate is that “we are increasingly competitive now” from a salary perspective, Thomas says. These tech professionals also have a desire “to balance their career progression with work/life balance … one could argue that’s a challenge” in Silicon Valley, he notes.

Traditional organizations also have large amounts of legacy systems and some technologists want the challenge of being able to modernize them, Thomas points out. “I call it the ‘blue ocean curiosity.’” Candidates he has spoken with also care about diversity and inclusion as well as companies that are committed to reducing their carbon footprints.

Making an impact is very important to modern tech professionals, Thomas says. “I think we’re ready for them.” At the same time, he says the level of interest in working in more traditional companies is “much more than I’ve seen in previous years.”

The lure of applied AI

Across the board, CIOs and other IT leaders are hiring software engineers, machine learning engineers, data scientists, digital project managers, and cloud professionals, and many are, in fact, offering them the opportunity to work on impactful and innovative projects.

At Proctor & Gamble, CIO Vittorio Cretella is focusing on cloud-native development and says IT has deployed about 180 apps from their Kubernetes platform, an increase of 76% in the past few months. Applied AI is another area of growth, and the company’s AI factory is in the process of deploying algorithms “so the teams of machine learning engineers who work on [them] know what they’re building are cutting edge,” Cretella says.

Vittorio Cretella, CIO, Proctor & Gamble

Proctor & Gamble

While he isn’t looking at Silicon Valley technologists exclusively, “it’s a natural component of the talent pool we target,” he says. “We offer them the unique value proposition of working in a digitally-savvy, large CPG company so they can keep working on leading-edge technologies, but also see how their work … produces a positive impact on consumers around the world.”

Another draw is the opportunity to gain experience working in a variety of businesses across a portfolio of 65 brands, Cretella adds.

P&G is applying AI at scale and automating the machine learning deployment process, he says. Product lines include an intelligent toothbrush that interacts with consumers with embedded AI. “These are large-scale applications of AI technology where our employees can see the results of their skills being applied and providing benefits to consumers,” which can be inspiring to technologists, he says.

He believes job stability is another lure. Unlike the peaks and valleys the tech industry has experienced, P&G is committed to hiring for the long haul. “We hire for careers and that’s a time horizon that’s much longer than any economic cycle,” Cretella says. “We hire for the job that needs to be filled today while understanding what skills will fuel the future. Technology underpins everything we do … and we make a commitment with recruits to provide them with a long-term career” as well as job security, flexible work arrangements, and skills development across all brands and geographic locations.

Saving people’s lives

Reducing friction for patients and providers and reducing the burden of disease are two areas of focus for Peter Fleischut, group senior vice president and chief information and transformation officer at NewYork-Presbyterian Hospital. There are also more people using the hospital’s portal than there are doctors using electronic records. That has meant a need to hire a lot of machine learning specialists and web and application developers “who have the ability to do what’s been done in other industries and apply that to healthcare,” Fleischut says.

Peter Fleischut, group SVP and chief information and transformation officer, NewYork-Presbyterian Hospital

NewYork-Presbyterian Hospital

One tech professional he hired away from Silicon Valley started his career as a data scientist and then began medical training to combine the two disciplines, he says. When he talks to candidates, Fleischut says he doesn’t promote IT projects as much as emphasizing a need to change how the organization works and takes care of patients.

“The exciting thing we can offer is we fundamentally save people’s lives every day,” he says. In addition to the opportunity to work at a large health system with hospitals throughout greater metropolitan New York, Fleischut believes there are many people who are driven by “the altruistic nature of our mission,” which the organization “has been pretty direct about.”

Working in a non-toxic environment

Like Silberkleit from XPO, Eli Lilly’s Rau has “made a conscious shift” to bring more tech development in-house, saying it is more costly to hire contractors, projects take longer and “at the end, you don’t retain the knowledge. My view is anything that’s strategically important, that’s something you need to do yourself and don’t give it away.”

Yet, he admits that the company hasn’t done a great job of selling its purpose in its recruiting efforts. Rau attributes that to a deeply ingrained culture that everyone takes for granted.

“Everyone takes a lot of pride in what they do here in the technology world, even if they’re a couple of steps away [from] getting people medicine” that will improve their lives, he explains. “It’s a different sensation from just solving cool problems.”

Beyond that, Rau believes that having a good environment to work in is extremely important. The phrase he heard when he worked in Silicon Valley and continues to frequently hear from friends there, is “toxic work environment,” he says. “It’s almost jarring because I don’t hear it anymore here at Lilly.”

That has caused Silicon Valley to “lose some of its luster,” Rau says. “If you’re a good engineer, why put up with that and be in an environment where you’re seeing bad behaviors from your boss or colleagues? Life’s too short to be in that [environment].”

Rau also speaks from personal experience. When he worked at Apple, “I was averaging one [expletive referring to a contemptible person] per week. … I’ve been here a year and a half, and I haven’t met an [expletive] yet.”

Hiring

According to Infosys research, data and artificial intelligence (AI) could generate $467 billion in incremental profits worldwide and become the cornerstone of enterprises gaining a competitive edge.

But while opportunities to use AI are very real – and ChatGPT’s democratisation is accelerating generative AI test-and-learn faster than QR code adoption during the Covid pandemic – the utopia of substantial business wins through autonomous AI is a fair way off. Getting there requires process and operational transformation, new levels of data governance and accountability, business and IT collaboration, and customer and stakeholder trust.

The reality is many organisations still struggle with the data and analytics foundations required to progress down an advanced AI path. Infosys research found 63 per cent of AI models function at basic capability only, are driven by humans, and often fall short on data verification, data practices and data strategies. It’s not surprising only one in four practitioners are highly satisfied with their data and AI tools so far.

This status quo can be partly explained by the fact eight in 10 only began their AI journey in the last four years. Just 15 per cent of organisations have achieved what’s described as an ‘evolved’ AI state, where systems can find causes, act on recommendations and refine their own performances without oversight.

Then there are the trust and accuracy considerations around AI utilisation to contend with. Gartner predictions forecast 85 per cent of all AI projects by 2022to wind up with an erroneous outcome through mistakes, errors, bias and things that go wrong. One in three companies, according to Infosys, are using data processes that increase the risk of bias in AI right now.

Ethical use of AI is therefore an increasingly important movement being led by government, industry groups and thought leaders as this disruptive technology advances. It’s for these important reasons the Australian Government deployed the AI Ethics Principles framework, which followed an AI ethics trial in 2019 supported by brands such as National Australia Bank and Telstra.

Yet even with all these potential inhibitors, it’s clear the appetite for AI is growing and spend is increasing with it.

So what can IT leaders and their teams do now to take AI out of the data science realm, and into practical business applications and innovation pipelines? What data governance, operational and ethical considerations must we factor in? And what human oversight is required?

It’s these questions technology and transformation leaders from finance, education and retail sectors explored during a panel session at the Infosys APAC Confluence event. Here’s what we discovered.

Operational efficiency is the no-brainer use case for AI

While panellists agreed use cases for AI could well be endless and societally positive, the ones gaining most favour right now orient to operational efficiency.

“We are seeing AI drive a lot deeper into the organisation around how we can revolutionise our business processes, change how we run our organisation, and all add that secret sauce from a data and analytics perspective to improve customer outcomes,” said ANZ Bank CIO for Institutional Banking and Markets, Peter Barrass.

An example is meeting legislative requirements to monitor communications traders generate in 23 countries. AI is successfully used to analyse, interpret and monitor for fraudulent activity at a global scale. Crunching and digitisation of documents, and chatbots are other examples.

Across retail and logistics sectors, nearly three in 10 retailers are actively adopting AI with strong business impact, said Infosys APAC regional head for Consumer, Retail and Logistics, Andal Alwan. While personalisation is often a headline item, AI is also increasing operational efficiencies and frictionless experiences across the end-to-end supply chain.

Cyber security is another favoured case for AI across multiple sectors, once again tying to risk mitigation and governance imperatives.

Advancing AI can’t be done without a policy and process rethink

But realising advanced AI isn’t only a technical or data actionability feat. It requires transformation at a systematic, operational and cultural level.

Just take the explosion of accessible AI to students from a learning perspective. With mass adoption comes the need for education institutions such as the Melbourne Archdiocese Catholic Schools (MACS) to actively build policies and positions around AI use. One consideration is how open accessibility of such tools can influence students. Another is protecting academic integrity.

Then it’s making sure leadership is very clear from an education system perspective to gain consistency across MACS’ 300 schools for how to utilise AI in learning. “We need to educate our teachers to be able to think about how their students will use AI and how they can maximise the learning for individual students, taking on-board some of these types of tools available,” MACS chief technology and transformation officer, Vicki Russell, said.   

Elevating data governance and sharing is critical

Simultaneously, data governance and practices need refinement. Alwan outlined two dimensions to the data strategy debate: Intra-organisation; and inter-organisation.

“Intra-organisation is about how I govern the data: What data I collect, why I’m collecting it and how am I protecting and using it,” she explained. “Then there’s inter-organisation, or between retailers, producers and logistic firms, for instance. Collaboration and sharing of data is very important. Unless there is visibility end-to-end of the supply chain, a retailer isn’t going to know what’s available and when it’s going to be arriving. All of this requires huge amounts of data, which means we’re going to need AI for scaling and to predict trends too.”

A further area of data collaboration is between retailers and consumers, which Alwan referred to as “autonomous supply chains”. “It’s about understanding demand signals from the point of consumption, be it online or physical, then translating that in real time to organisation systems to get more security of planning and supply chain. That’s another area of AI maturity we’re seeing evolving.”

Infosys Knowledge Institute’s Data + AI Radar found organisations wanting to realise business outcomes from advanced AI must develop data practices that encourage sharing and position data as currency.

But even as the financial sector works to pursue data sharing through the Open Banking regime, Barrass reflected on the need to protect the information and privacy of customers and be deliberate about the value data has to both organisation and customer.

“In the world of data, you have to remember you have multiple stakeholders,” he commented. “The customer and person who owns the data and who the data is associated with is really the curator of that information, and should have right to where it’s shared and how it’s shared. Corporates like banks have a responsibility to customers to enable that. That needs to be wrapped up in your data strategy.”

Internally, utilising the wealth of education learning and data points MACS has been capturing is a critical foundation to using AI successfully.

“The data and knowledge a business has about itself before it enters into an AI space is really important in that maturity curve,” Russell said. “Having great data and knowing what you have to a certain extent before you jump into your AI body of work or activities is important. But I also think AI can help us leapfrog. There’s knowing enough but also being open to what you might discover along that journey.”

Building trust with customers around AI still needs human oversight

What’s clear is the onus is on organisations to structurally address trust and bias issues, especially as they lean towards allowing AI to generate outcomes for customers autonomously. Ethical use of data and trust in what and how information is used must come into play. As a result, parallel human oversight of what the machine is doing to ensure outcomes are accurate and ethical remains critical.

“Trust in the source of information and really clear ownership of that information is really important, so there’s clear accountability in the organisational structure for who is responsible for maintaining a piece of information driving customer decision outcomes,” said Barrass.  “Then over time, as this matures, we potentially could have two sets of AI tools looking at the same problem sets and validating each other’s outcomes based on different data sets. So you at least get some validation of one set of information drivers.”

Transparency of AI outcomes is another critical element with customers if trust in AI is to evolve over time. This again comes back to stronger collaboration with data owners and stakeholders, an ability to detail the data points driving an AI-based outcome, and explaining why a customer got the result they did.

“It’s very important to be conscious of the bias and how you balance and provide vast sets of data that constantly work against the bias and correct it,” Alwan added. “That’s going to be key for the success of AI in the business world.” 

We all need to work with ChatGPT, not against it

Even as we strive for responsible AI use, ChatGPT is accelerating generative AI adoption at an unprecedented rate. Test cases are being seen in everything from architectural design to writing poetry, creating law statement of claims and developing software code. Panellists agreed we’re only scratching the surface of use cases this generative AI can tackle.

In banking, it’s about experimenting in a controlled way and understanding the ‘why’ so generative AI is applied to achieve solid business outcome, Barrass said. In the world of retail and consumer-facing industries, conversational commerce is already front and centre and ChatGPT is set to accelerate this further, Alwan said.

For Russell, the most important thing is ensuring the future generation learns how to harness openly accessible AI tools and can prompt it appropriately to gather great information out of it, then reference it. In other words, education evolves and works with it.

It’s a good lesson for us all.

Infosys

We’ve entered another year where current economic conditions are pressuring organizations to do more with less, all while still executing against digital transformation imperatives to keep the business running and competitive. To understand how organizations may be approaching their cloud strategies and tech investments in 2023, members of VMware’s Tanzu Vanguard community shared their insights on what trends will take shape.

Tanzu Vanguards, which includes leaders, engineers, and developers from DATEV, Dell, GAIG, and TeraSky, provided their perspectives on analyst predictions and industry data that point to larger trends impacting cloud computing, application development, and technology decisions.

Trend #1: More organizations will take on a cloud-native first strategy, accelerating the shift to containers and Kubernetes as the backbone for current and new applications.

According to Forrester, forty percent of firms will take a cloud-native first strategy. Forrester’s Infrastructure Cloud Survey 2022 reveals that cloud decision-makers have implemented containerized applications that account for half of the total workloads in their organizations. Kubernetes will propel application modernization with DevOps automation, low-code capabilities, and site reliability engineering (SRE) and organizations should accelerate investment in this area as their distributed compute backbone.

“I agree on the cloud-native first strategy [prediction] since Kubernetes is the base for modern infrastructure. But you have to take into account that cloud native first does not mean public cloud first. Especially in regulated environments, public clouds or the big hyperscalers won’t always be an option,” says Juergen Sussner, cloud platform engineer and developer at DATEV. “If you look into the startup world, they start in public clouds, but as they grow to a certain scale, cloud costs will become a big problem and the need for more control might come up to bring things back into their own infrastructures or sovereign clouds. So cloud-native first, yes but maybe not public cloud first to the same degree.”

While Scott Rosenberg, practice leader of cloud technologies and automation at TeraSky, agrees with Forrester’s prediction, he notes that there is nuance in the details. “The growth of Kubernetes, and the benefits it brings to organizations, is not something that is going away. Kubernetes and containerized environments are here to stay, and their footprint will continue to grow. As Kubernetes is becoming more mature, and the ecosystem around it as well is stabilizing, I believe that the challenges we are experiencing around knowledge gaps, and technical difficulties are going to get smaller over the next few years. With that being said, due to the maturity of Kubernetes, I believe that over the next year, the industry will understand which types of workloads are fit for Kubernetes and which types of workloads, truly should not be run in a containerized environment. I believe VM-based and container-based workloads will live together and in harmony for many more years, however, I see the management layers of the 2 unifying in the near future, as is evident by the rise of ecosystem tooling like Crossplane, VMware Tanzu VM Operator, KubeVirt and more.”

Even if organizations decide to take a containerized approach to their applications,  Jim Kohl, application and developer consultant at GAIG, says “there still is heavy lifting in moving the company project portfolio over to the new system. Even then, companies will have a blend of VM-centered workloads alongside containerized workloads.”

Similarly, Thomas Rudrof, cloud platform engineer at DATEV eG, agrees that we won’t necessarily see the end of VM-based workloads. “Our organization, as well as the majority of the industry, is already adopting a cloud-native-first or a Kubernetes-native-first strategy and will increase their investment in technologies like Kubernetes and containers in the coming years. Especially for new apps or when modernizing existing apps. However, it is also important to note that there are still many apps that run on virtual machines and do not work natively in containers, especially in the case of third-party software. Therefore, I think there will still be a need for VM workloads in the coming years,” says Rudrof.       

“This year, companies will focus on cost optimization and better use of existing hardware resources. Using containerization will allow you to better control application environments along with their lifecycle. It will also allow for more effective and faster delivery of the application to the customer. IT departments should reorganize some IT processes that use a VM-based approach rather than containers,” says Lukasz Zasko, principal engineer at Dell.

Trend #2: Optimizing costs and operational efficiency will be a focus for organizations looking to improve their financial position amidst an economic downturn and skills shortages. IT leaders and executives must use AI and cloud platforms, and adopt platform engineering, to improve costs, operations, and software delivery.

Gartner’s Top Strategic Technology Trends for 2023 advises that this year is an opportunity for organizations to optimize IT systems and costs through a “digital immune system” that combines software engineering strategies like observability, AI/automation, and design and testing, to deliver resilient systems that mitigate operational and security risks. Additionally, with ongoing supply chain issues and skills shortages, organizations can scale productivity by using industry cloud platforms and platform engineering to empower agile teams with self-service capabilities to increase the pace of product delivery. Lastly, as organizations look to control cloud costs, Gartner states that investments in sustainable technology will have the potential to create greater operational resiliency and financial performance, while also improving environmental and social ecosystems.

“Eliminating cognitive load from your developers by using platform engineering techniques makes them more productive and therefore more efficient. There’s always a discussion about what can be centralized, and what should and should not be centralized as it can cause too much process overhead when not giving this specific control to your developer teams,” Sussner says. “The rise of AI in this case can’t be overlooked, like GitHub Copilot and many intelligent tools for managing security and many other aspects of supply chains.”

However, cost savings isn’t necessarily a new prediction or trend for organizations in 2023, according to Martin Zimmer – Technology Lead Modern Application Platforms at Bechtle GmbH. “I have heard this for 10 or more years. Also, AI will not help with [cost savings] because the initial costs are way too high at the moment.”

On the other hand, Rudrof says, “AI has the potential to significantly improve the efficiency, productivity, and effectiveness of IT professionals and organizations, and is likely to play an increasingly important role in the industry in the coming years.” He is also optimistic about platform engineering as a trend that will impact enterprise strategies. “I believe that platform teams are essential in helping DevOps teams focus on creating business value and in providing golden paths to enhance the overall developer experience,” says Rudrof.

Trend #3: Infrastructure and operations leaders will need to rethink their methods for growing skills to keep pace with the rapid changes in technology and ways of working.

Gartner predicts that through 2025, 80% of the operational tasks will require skills that less than half the workforce is trained in today. Gartner recommends that leaders implement a prioritized set of methods to change the skills portfolio of the infrastructure and operations organization by creating a skills roadmap that emphasizes connected learning, digital dexterity, collaboration, and problem-solving.

“The main problem in 2023 will be how can we learn new skills fast and stay on top of all the new tools and technologies in every area. If you implement a toolchain today, tomorrow it’s old,” Zimmer says. He adds that implementing a skills portfolio is nothing new. “Connected learning, digital dexterity, collaboration, and problem-solving should be the ‘normal’ skills of everyone who works inside the IT organization. The days where an IT ‘guru’ sits in his dark room and runs away when you try to talk with him are long gone.”

While developing digital and human skills will always be important for current and future workforces as hybrid work and digital transformation initiatives take hold, organizations must also look inward to evolve company culture. Sussner believes that being able to react and adapt to change is a skill in itself that an organization has to develop. “Not only do DevOps teams have to adapt to changing requirements, but also company structures. If you take Conway’s law seriously, this means being able to develop software in an agile way, would also raise the necessity to be able to change company structures accordingly.” Conway’s law states that organizations design systems that mirror their own communication structure.

“This huge step in company culture requires brave managers adopting agile principles. So in my opinion, it’s not only about technology transformation, it’s also about company culture that has to evolve. If neither technology nor culture does not take part in this game, all will fail,” Sussner adds.

At a time when budgets and margins are tightening, leaders should take this time to re-evaluate investments and prioritize the technologies and skills that build a resilient business. As business success increasingly relies on the organization’s ability to deliver software and services quickly and securely, building a company culture that prioritizes the developer experience and removes infrastructure complexity to drive productivity and efficiency will be critical for 2023 and beyond.

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Cloud Computing

The new year brings with it enthusiasm for new priorities and accomplishments to come, resolutions to seize opportunities and overcome challenges, and the opportunity to assess takeaways from the previous year and turn the page on projects and missteps past.

In the ideal beginning of the year scenario, organizations would have completed celebrating and cerebrating on accomplishments of the previous year and performing forensic root cause analyses of the smattering of initiatives that failed to meet expectations. Now, rolling into Q1 with heads held high and bursting with confidence, the enterprise should be enthusiastically embarking on programs designed to realize the full promise of explicitly articulated goals and objectives.

This, however, is not the situation in many — probably most — IT and digital organizations today.

Having just completed my walkabout of the C-suite in 12 vertical markets, I have found that the three words most frequently used to describe the general attitude toward 2023 were “uncertainty,” “headwinds,” and “conservative.” This has led me to conclude that the No. 1 job of IT and digital leaders in 2023 is to “un-cancel” the future. They have to get their organizations to believe and behave as if 2023 is going to be better than 2022. 

Navigating a tsunami of macro-pessimisms

The general message from a multiplicity of disciplines is lack of hope and optimism. “Doom Porn” — for example, books resembling Paul Ehrlich’s The Population Bomb and Nouriel Roubini’s MegaThreats: Ten Dangerous Trends That Imperil Our Future, And How to Survive Them — continues to top non-fiction best seller lists.

Forecasters at my former hangout, The World Bank, tell us that growth will be a less than breathtaking 1.7%. My classmate at Carnegie Mellon, hedge-fund manager-extraordinaire David Tepper, told CNBC viewers that they “can’t fight the Feds” and that equities are not going anywhere in 2023.

“More than two-thirds of the economists at 23 large financial institutions that do business directly with the Federal Reserve are betting the U.S. will have a recession in 2023,” according to The Wall Street Journal.

In the foreign policy community gloom has become commonplace across the “West” in recent years.

Important voices in the environmental movement counsel that we are to adopt a “future of less, a restricted life, purged of joy.”

Robert Silverberg, in his introduction to This Way to the End of Times: Classic Tales of the Apocalypse, reminds us, “the market in apocalyptic prophecy has been a bullish one for thousands, or more likely millions of years.” We may like our fictional future dark and dystopic but science-fiction novelist William Gibson is concerned that people have given up on the future they will actually live in:

“All through the 20th century we constantly saw the 21st century invoked. … How often do you hear anyone invoke the 22nd century? Even saying it is unfamiliar to us. We’ve come to not have a future.”

Re-branding the future

The fact that the macro-picture is less than rosy is not an excuse to sit back and coast through 2023. IT and digital leaders need to re-introduce stakeholders to a future they want to live in. 2023 can be a great year. For this to happen IT and digital organizations need to re-establish trust that their agency will make things better.

Step one: IT/Digital needs to clean house. We need a skills- and attitude-driven purge of the incompetents who inhabit so many critical positions. Cheryl Smith, former CIO at Keyspan, McKesson, and West Jet and author of The Day Before Digital Transformation: Unlocking Digital Transformation for Business Leaders, has long lamented the lack of credentialing in the CIO/CDO arena. Lawyers are required to master a basic body of knowledge. As are doctors, nurses, and accountants. Any yahoo who can steam a mirror can be a CIO/CDO.

Debra Hockemeyer, who has designed and managed multiple digital transformations in multiple industries, is similarly shocked at how IT/Digital is being managed in many major enterprises today. “There is a way to consistently, reliably, and affordably deliver the benefits of digital,” she says.

Put very simply, basic IT blocking and tackling snafus such as those that recently devastated Southwest Airlines and the FAA should not be allowed to occur. Applying the words of Glenn Kelman, CEO of Redfin, to the tech and digital arena, we need to “stop doing stupid stuff.”

US Secretary of Transportation Pete Buttigieg is spot on when he demands a root cause analysis of exactly what happened. The names of the sic IT professionals who brought the entire aviation infrastructure to a screeching halt should be plastered over every science classroom in the country with the admonition, “Don’t be these guys!” The contractor they work for should be banned from all government work for no less than five years.

Let me be perfectly clear: I am not against making mistakes in the IT/digital realm. This is the only way our discipline can grow. I am advocating that we make new mistakes. We cannot — like so many organizations — be so afraid of “breaking something” that we conduct no experiments and stifle all innovation. The blow ups at Southwest and the FAA were not innovations gone awry. They were malfeasant acts by incompetents.

Step two? Collaboratively imagine a future that works — and that we can work toward.

Emerging Technology, Innovation, IT Leadership, IT Strategy

Even though sustainability can be an amorphous organizational pursuit, it’s becoming more of an urgent priority all industries must clearly define. Whether that’s through internally motivated ESG efforts or imposed regulations, CIOs, in particular, find themselves increasingly central figures in sustainability initiatives. And scope 3 reporting—an account of carbon emissions across the supply chain to build equipment, provide professional expertise, or deliver a subscription service—may be the most rigorous and challenging requirement. While scope 3 reporting won’t be mandatory anywhere before 2024, the hard work to prepare has already begun in some organizations—even though the blueprint isn’t yet finalized.

“Scope 3 reporting will come as a shock to a lot of technology leaders,” says Niklas Sundberg, CIO of global solutions at Swedish conglomerate Assa Abloy. “I think this is going to be even more massive than GDPR. Companies will be required to publish real numbers about sustainability across the supply chain—and much of the data will come from IT procurement.”

The Greenhouse Gas (GHG) Protocol Initiative, a multi-stakeholder partnership of businesses, NGOs, governments, and other players was formed in 1998 to define standards and frameworks, including three different scopes for reporting. Scope 1 is on direct emissions from sources owned or controlled by an organization, including emissions from company-owned power generators. Scope 2 is on all indirect emissions resulting from an organization’s energy consumption, including emissions from the company’s energy provider. And scope 3 reporting for one company depends on scopes 1 and 2 reporting from the next company upstream in the supply chain. Or it could mean getting scope 3 reporting from the next company upstream when the supply chain is deeper than just one step, which is usually the case.

In Europe specifically, EU taxonomy for sustainable activities has been in force since July 2020. The goal is to reach a climate-neutral economy in the EU by 2050, with an intermediate milestone of a 55% reduction in emissions by 2030. Companies in Europe are required to start scope 3 reporting in 2024 with data from 2023, so collecting that data starts now. In the US, on the other hand, the Securities and Exchange Commission (SEC) published a rule proposal in March 2022 calling for companies to start gathering scope 3 emission data as early as in 2024 for reporting in 2025. While this is not yet law, the fact that the SEC made such a proposal is a good indicator that it will be soon.

Regardless of the timeline of in-country regulators, US companies doing business in Europe already have to adhere to the same rules as their European counterparts. And some organizations have already started doing scope 3 reporting regardless of mandates. They do so knowing that many investors and customers want to limit their business to companies that are committed to sustainability efforts.

Scope 3 reporting specifically places a heavy burden on many CIOs because IT is a large part of procurement for many companies outside of manufacturing, where business is about buying raw material and component parts from the supply chain and converting them into products. Furthermore, IT accounts for most of the energy expenditure for a lot of organizations—and it’s getting worse. With each new generation of the sophisticated applications companies have come to depend on—applications, such as machine learning and data analytics—compute requirements soar to new heights.

In the short term there will be cascading errors and double counting. But once the kinks are ironed out, third-party consultants will be able to put together an accurate picture that traces carbon emissions across supply chains. The big consulting firms already have their eyes on what this can do for their businesses. They know that GHG reporting—and particularly scope 3—will be a lucrative field of expertise that they can market to IT leaders.

The race is on in Europe with the US following suit

The large companies, who for one reason or another have started to report, depend on emissions numbers from their suppliers. This in turn puts pressure on everybody in the supply chain to do their own reporting, even if they’re not yet required to do so by law.

“One of the challenges with scope 3 is a lot of vendors in your supply chain can’t disclose this information today,” says Sundberg, who echoes these points in his new book Sustainable IT Playbook for Technology Leaders. “Nobody can tell you how much CO2 emission is embedded in some of the more popular software—for example, how much is consumed for one user to run Office 365 for a year. If you have 50,000 Office 365 users, there are no metrics to help you make the calculation at this point.”

IT leaders generally need to get numbers from suppliers in four different categories: hardware vendors, software vendors, professional service providers, and cloud providers. The large hardware vendors usually have the numbers readily available. Software vendors don’t know where to start. Professional service providers, once they overcome the tedium, can get a good count by tracking down things like emissions incurred during travel. As for cloud services, some of the large cloud providers have the numbers ready—and for those who don’t, a third party can calculate emissions based on geographic location and the type of equipment used.

Organizing for sustainable IT

Many companies in Europe have built teams to address IT sustainability and have appointed directors to lead the effort. Gülay Stelzmüllner, CIO of Allianz Technology, recently hired Rainer Karcher as head of IT sustainability.

“My job is to automate the whole process as much as possible,” says Karcher, who was previously director of IT sustainability at Siemens. “This includes getting source data directly from suppliers and feeding that into data cubes and data meshes that go into the reporting system on the front end. Because it’s hard to get independent and science-based measurements from IT suppliers, we started working with external partners and startups who can make an estimate for us. So if I can’t get carbon emissions data directly from a cloud provider, I take my invoices containing consumption data, and then take the location of the data center and the kinds of equipment used. I put all that information to a rest API provided by a Berlin-based company, and using a transparent algorithm, they give me carbon emissions per service.”

Internally speaking, the head of IT sustainability role has become more common in Europe—and some of the more forward-thinking US CIOs are starting to see the need in their own organizations.

“Europe is a step ahead,” says Srini Koushik, CTO of Rackspace Technology in the US. “We’re a global company, so we already started our preparations for scope 3 reporting. Our approach has been if we can meet the European standard, then we’ll be a year or two ahead of the rest of US organizations.” Hiring chief sustainability officers is the way to go, he adds, but the question remains how that person fits into the hierarchy. “That will depend a lot on the industry,” he says.

In many industries, such as finance, IT is a big part of overall procurement. It makes sense to have a role dedicated to sustainability reporting into the CIO. However, in other industries, such as manufacturing, where much of the procurement occurs outside of IT, it makes more sense to have a chief sustainability officer separate from IT.

Large companies have already begun working on scope 3 reporting, and this has already started to put pressure on smaller partners. “Companies do a calculation on how much overhead they have to put in to make up for suppliers that don’t give them enough information,” says Koushik. “If the supplier isn’t worth that overhead, they’ll change suppliers.”

Once people settle on reporting and investors, and customers start to see which companies are doing well on CO2 emissions, companies will start to re-evaluate their suppliers—and that’s exactly the reason behind the reporting. But not everybody is onboard yet. Too many companies lack in-house expertise.

“I know so many IT leaders who are not familiar with the GHG protocol,” says Koushik. “Now is a good time for them to get started.”

Starting now means jumping ahead on what will likely become an important part of IT leadership in the future. CIOs who get behind may have to rely on consulting firms to track and report on GHG emissions. That could be the right decision. But the decision to outsource such an important activity should be a deliberate act, rather than just a knee-jerk reaction.

Data Governance, Green IT, IT Governance

For many enterprises, the pandemic involved rapidly deployed ways of enabling remote working. Today, the need for long-term solutions means that hybrid working is one of the top three trends driving network modernization – as reflected in the 2022-23 Global Network Report published by NTT.

According to the survey data for this report, 93% of CEOs agree that even if their staff return to the physical workplace, they will provide an expanded remote or hybrid-working policy.

But even though hybrid working is here to stay, organizations may still lack the cybersecurity controls and business-grade internet connections, like SD-WAN, that are required to support remote and hybrid workers. The burden on the network grows even as some employees start returning to the office.

The report flags three ways in which CIOs and CTOs are reshaping the physical workplace to meet these new demands:

Increasing Wi-Fi density and speed for seamless connectivity and high-bandwidth applicationsConverging information technology (IT) and operational technology (OT) networksProviding modern meeting rooms and devices with high-resolution video

However, the impact of these increased burdens on enterprise networks isn’t always widely appreciated. Amit Dhingra, Executive Vice President of Enterprise Networking at NTT, says: “Nobody expected it. But the requirement on the network is increasing because even when we go into the office, we spend much of the day on high-definition video calls.

“The network was never built for that. It was built for in-person collaboration within the office, not virtual collaboration. But in the workplace, we have all become guzzlers of bandwidth in a way we were not before the pandemic.”

In the Global Network Report survey, 97% of CIOs and CTOs say that hybrid working leads to a higher demand for network connectivity, generated by both home and remote working.

The result: network managers now need to ensure that networks are both fit for remote working and able to cope with the demands of high bandwidth consumption in the workplace.

The survey also shows that 93% of CIOs and CTOs believe the campus network is the most critical element to enabling a resilient hybrid workplace.

On top of these challenges, Matthew Allen, Vice President, Service Offer Management – Networking at NTT, identifies a further difficulty. “Once you’ve got distributed employees all over the place, how does IT get visibility? How are those users accessing their systems? Are they performing to standard? If employees are not able to access key business systems no matter where they are, you have an issue. Lack of visibility is really one of the key problems that we have encountered.”

NTT’s recipe for hybrid working begins with zero trust network architecture, identity management and multifactor authentication. There’s also the requirement for a seamless transition between different work environments, says Allen: “Everyone returns to the office, carries their company laptop if they’ve got one, carries their phone, carries their watch, carries whatever. If I’m connecting all of these things at home, I want to be able to walk into my office and connect in a similar way without too much drama. If the underpinning technology enables that experience, this becomes a way to start bringing people back into offices.”

Finally, there’s the need to consider access technologies. Dhingra says: “It’s wireless-first if you ask us, perhaps wireless-only campus connectivity. Gone are the days when you used to have lots of fixed LAN cables. This is true in offices, and it’s true in factories too. This, combined with wireless access, enables manufacturers to rejig assembly lines within days, rather than months.”

Enabling productivity and effective collaboration amid hybrid working has become one of the top five business objectives for organizations, the Global Network Report shows. After what was – in many cases – a frantic transition at the start of the pandemic, it’s clear that a good deal more work remains to be done before enterprises can claim to have laid the foundations for a long-term hybrid-working strategy.

NTT’s Global Network Report takes stock of how networks are evolving, organizations’ preparedness for these changes and how they will adapt their networks to these new demands.

Download the 2022–23 Global Network Report

Networking

Erin Howard, executive director of product, service, and experience design at Charles River Laboratories, admits she doesn’t get into all the scientific intricacies of the blood products her company supplies to its customers for their research needs.

But she and her team did understand what was working and, perhaps more importantly, what wasn’t working in the interactions that Charles River had with blood donors and its own business customers.

In fact, finding those pain points — where customer experiences need improvement — is squarely in her wheelhouse.

Howard joined Charles River, which provides products and services to pharmaceutical and biotechnology companies, government agencies, and academic institutions for their research and drug development efforts, in March 2021 as the first one in her role.

“I joined to bring design thinking and to reimagine how we work,” she says.

According to Howard, the company created the position, which reports to the CIO and is part of the global IT leadership team, to ensure that its digital products deliver the best customer experiences and to ensure those experiences help customers do their own jobs better.

“We’re hoping that digital transformation with its focus on customer experience will take one year off the drug-development lifecycle,” she says. “We want to be that impactful.”

Howard and her 14-member design team hunt for ways to do that. She subdivided her teams into groups assigned to different customer areas, with those groups working with the IT teams delivering customer-facing products, engaging in continuous discovery activities and scheduling regular meetings directly with customers to learn about their needs.

That’s all to understand the customer journey and create customer personas so the groups can help develop digital products that better meet customer needs.

Insights and customer experience improvements gleaned by one group are shared, thereby creating synergies where pain points within different customer journeys are similar, Howard explains. And her design team works with agile development teams to iterate, test, learn, and rapidly evolve customer experience features.

“It’s about enhancing the customer experience with a digital tool,” she says. “We’re talking about ease and speed. We can’t just digitalize our ways of work. We’re looking for ways to reimagine the solutions, honing in on pain points and finding a technology-enabled new process or new way of working with us.”

That’s what led her team to the blood donation process and its drive to fix how it was falling short.

“We found that the product donation experience was a great opportunity for really impactful customer experience change,” Howard says. “We were still making a lot of phone calls, finding people word of mouth, and we were calling in the same donor pool. But donors are now mobile and used to digital tools, so we weren’t really meeting the donors in the way they wanted to interact with us. We weren’t honed in on their needs.”

Her designers created customer personas to understand both the donors and the business customers, taking the insights gathered from that exercise to ideation sessions focused on how to reduce the time it took to identify, diversify, expand, and ultimately enroll the pool of blood donors in their collection process.

The designers then used those donor-side improvements to create customer experience improvements for the company’s business customers, who as a result of all this work see both a quicker delivery of blood products and more diversity within those products — two essential elements for the clients’ cell and gene therapy development.

After nine months of work, her team launched the new digital donor experience in October, reducing a process that took weeks to one that donors can do themselves in minutes via a new app.

CX: A central tenet to digital transformation

The idea of meeting customers “where they are” has became core to digital transformation success — a tenet that, in turn, has put more of the work of customer experience (CX) under the remit of IT as companies look to make good on the promise of digital transformation.

In fact, customer experience is now a priority for all enterprise executives. The 2022 Be Digital Research report from digital consulting firm West Monroe surveyed 700 C-suite executives and found that improved customer experience is No. 1 among the top three priorities for growth. (The other priorities were enhanced data capabilities and increased scalability through process improvement.) Executives also listed customer experience as one of their top 5 areas for “next big digital investments.”

Calvin Cheng, managing director of West Monroe’s Product Experience & Engineering Lab, defines CX as “the impression and perception customers have when they interact with a company and a brand.”

He says everyone within an organization is responsible for customer experience. Consider, for example, that a company trying to resolve a customer complaint about a missed or late shipment will need information from finance, supply chain, logistics, and others.

Yet CIOs, he notes, are the “executives at the table defining and delivering on the corporate customer experience strategy and enabling the technologies that brings it to life.”

“The CIO has a high level of responsibility to coordinate technologies that enable and ensure the privacy and security of those engagements,” Cheng says, adding that those enabling technologies include artificial intelligence and machine learning as well as automation such as robotic process automation (RPA).

Moreover, he says, CIOs must also know how to make those enabling technologies work across various touchpoints to ensure a seamless experience.

Despite its growing importance to enterprise success, CIO efforts to build CX capabilities within their IT shops and their ability to use those capabilities to transform their organization’s customer experiences have had mixed results.

The West Monroe survey found that 92% of organizations said they are effective at putting the customer at the center of everything; 93% said they’re effective at creating “fluid, connected experiences across digital and physical worlds”; and 75% are investing heavily in the customer experience. Yet only 37% of companies gave an “A” to their customer experience.

“There are still companies that are struggling to bring customer experiences to life,” Cheng says, noting that companies in the business-to-business space and those in the middle market tend to lag behind the largest companies and consumer-facing ones when it comes to maturing their CX disciplines.

CIO as owner of CX

As CIO of tech company Logitech, Massimo Rapparini has taken direct responsibility for customer experience: He took on the head of customer experience title and role about four years ago after serving as only CIO for about 18 months.

“The intent is to have a single person for experience. I’m not the only one who shapes experience, but we want someone to bring it all together, and knowing how technology drives experience is the driver behind using me [the CIO] in the role,” Rapparini explains.

He says having a single owner of CX has helped the company focus on creating consistently positive and seamless experiences at all touchpoints, rather than having siloes of great experiences.

And having that single owner be the CIO allows the company to create unified experiences throughout, he says, “because technology plays such an important role in how you stitch together all these different customer touchpoints in the journey.”

Furthermore, he says having one owner has brought companywide alignment to Logitech’s vision of what great CX should be. Rapparini says he and his team did that by developing a list of objectives (known as the “7 Es”) for designing experiences.

“Building on our company values, we are committed to delivering an experience based on the 7 Es to advocate for our customers: empathy, expectation setting, effortless, engaging, eliminating errors, equitable, and environmentally sustainable,” he says.

Rapparini also uses other commonly recognized CX best practices such as creating personas and customer journeys, having CX teams engage business groups and products teams, and following agile development methodologies with incremental delivery.

Rapparini credits this cohesive CX program for recent customer experience improvements and shaping planned CX innovations, such as using artificial intelligence to predict product failures before they happen and creating embedded self-healing capabilities.

CIO as conductor

Monica Caldas, deputy CIO for Liberty Mutual Insurance, is also looking ahead to determine how and where CX can better serve the company’s customers.

“When we start with our company’s purpose, ‘We exist to help people embrace today and confidently pursue tomorrow,’ you understand that the customer experience and helping our customers at their time of need is always in focus,” she says. “Specifically related to the customer experience, it is always important to us to provide products and services that deliver on our promise. Across the globe we have teams that are working on improving what we deliver, and we incorporate the customer journey perspective into our work when we are delivering technology capabilities.”

Liberty Mutual has been building such capabilities for more than a decade, when the customer advocacy team was first established.

“The team’s mandate is to serve as passionate customer advocates who work across the business to ensure that everything Liberty Mutual does begins with the customer in mind,” Caldas says. “The team ensures that customer-facing employees are empowered and equipped with the tools, training, processes, and support to consistently deliver an outstanding customer experience.”

Caldas points to one recent example to illustrate how all this work enables IT to deliver value to Liberty Mutual customers when they are most in need of service.

IT created a tool that uses AI, aerial imagery of an area before and after a catastrophic event, and weather data to identify damage to customers’ properties before policyholders even call in claims. “This enables our claims organization to be more responsive and deploy resources to those areas with customers most in need,” Caldas says.

Creating such impactful customer experiences by rallying resources should be the CIO’s goal, experts say.

“Customer experience is like a symphony orchestra. There are a lot of players. They need to be working together to create something beautiful. They have to be playing all together to deliver a great performance. In a similar manner, the elements across an organization have to work together in concert to deliver on customer experience expectations,” West Monroe’s Cheng says.

CIOs will become even more important in orchestrating those coordinated efforts moving into the future, as customer expectations continue to evolve and as they rely on emerging technologies such as digital payments and the metaverse.

“Customer experience continues to change and customer expectations of brands continue to increase,” Cheng adds. “Those companies that can make bold moves to make customer experience their competitive differentiator can have better business performance by increased customer acquisition, customer growth, and customer satisfaction. And those companies that can align their internal people, processes, and technology to adapt and meet those customer expectations will be the most successful.”

IT Leadership, IT Strategy

In the second of this two part CIO webinar series ‘Driving business success with true enterprise applications’, we speak with DXC Technology, brewing giant Lion and analysts Ecosystm about ‘How to take customer experience to the next level’.

Today more than ever before, the customer is king.

And having been conditioned – some might say spoilt – over the past several years to hyper-personalisation via the growing number of intelligent digital platforms, delivering them the best possible experiences has now emerged as a major competitive differentiator.

Key to this is ensuring you have the right data and systems to underpin every customer interaction. This means having all customer-related data in a single repository, updated in real time, and accessible by business critical systems.

But as with so many challenges in this business, it’s a lot easier said than done. You need the right strategy, the right teams and the right culture, as well as the right solutions in place. And you need a proper plan to bring everyone in the organisation along with you on the journey.

Brewing giant Lion is one of the most established companies in Australasia, having carried some of our most famous and enduring beverage brands over a more than one hundred year history. And the explosion of new beer brands, especially in the craft space over the past several years, means it’s a more dynamic and complex business than ever.

Back in 2019, before COVID, Lion’s head of customer business process excellence, Nicole Parés and her team embarked a mission to gain a “360 degree view” of the company’s partner customers.

Shortly after, they met and quickly partnered with DXC Technology to set out a strategy to optimise the SAP Marketing solution and provide a customer experience that only a fully integrated tech stack could provide.

Changing customer – and partner – expectations demanded that the company undertake a full transformation if it was going to develop proper systems for managing its many moving parts and remain competitive into the future.

“I recognised that we had, three hundred legacy systems that had very little integration between them, making it difficult to utilise data and analytics, to draw insights and make business decisions,” Parés recalls.

Deployment of multiple SAP modules followed, until one day the legacy systems were switched off and Lion was operating in a new digital world.

Data driven

Perhaps the most profound change, Parés says, has been the cultural shift towards becoming an organisation that properly understands the value of data, especially in terms of driving better customer experiences.

“I can see the impacts through that our entire value chain … it [data] gives you the avenue through the technology of that marketing cloud to be really targeted in who your customer segments are.

“That in itself has been a transformative journey for our business”.

Matthew Varone, SAP CX consultant with DXC Technology says he and his team were initially brought in to work on a fairly narrow use case deploying SAP CX applications and marketing cloud.

From there the remit was expanded to encompass a broader plan to improve engagement with Lion’s extensive partner channel.

“[We started] working towards the right solution that’s 100 percent focussed on excellent customer experiences”.

This meant making sure the solution was right for everyone “and so that involved partnering very closely and doing lots of discovery, and going on the journey together to make sure we get the right outcome.”

Alan Hesketh, principal adviser with ecosystem and author of Start fast: Achieving rapid impact from digital transformation, has himself been at the coalface of several major digital transformation projects, in particular for the retail and fast moving consumer goods sectors.

He notes that for companies like Lion the challenge is how to harness data so that people find it easier – and are more inclined – to do business with you.

It’s essential therefore, to have “accurate data”.

“[It means] you’re able to use the data that they’re giving you to do the right kind of promotional activities to get that the expected returns .. and so when they’re doing that electronic ordering, it just flows through smoothly.”

Varone explains that DXC has helped Lion connect with its customers across multiple touchpoints.

“We’re measuring click through rates and engagement when they’re on the phone with agents and through the CRM system. You know those interactions are coming back, and all of those are being centralized and building this vision of one picture of a customer.”

Parés adds that being able to demonstrate that the project would give rise to new revenue streams was a key factor in getting buy in from the broader executive team. And further endearing her and her team was the fact that there were “zero issues” after ‘go-live’; a remarkable achievement for a project of this scale.

“It’s amazing now to look back and reflect on what that journey was like for us, putting that case forward and getting the buy in. Now we have the right technology, we can turn that into a competitive advantage.

Working on the marriage

Much is made of the importance of having great teams if major digital projects are to achieve their most ambitious objectives. And that also means different teams being able to work well together.

Parés reflects that hers and Varone’s team at DXC were united by strong sense of purpose but without any illusions about what needed to be done.

“We kept each other accountable, challenging what it was we were trying to achieve, and how we would get there.

“I think for me what I really enjoyed was it wasn’t a case of saying ‘here’s what I want to do. Go and do it. It was a partnership to understand, ‘well, have you considered that this is possible, or you are doing this process right now?’.”

Varone feels that that’s what made the “marriage” between Lion and DXC special.

“Did it take work? Yes, like most teams like this, forming and storming and norming, and all of those sorts of progressions that we all make together.”

“But there was always a lot of respect for each other”.

SAP