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The digital transformation experiences of DreamWorks, Merck, CenterPoint Energy and Callidus

mikeshaw747

At DISCOVER in Las Vegas, senior vice president of marketing at HPE, Jim Jackson facilitated a discussion with four executives who have been thru, and continue to go thru, digital transformations. The executives were:

  • Kate Svanborg, SVP of Technical Communications and Strategic Alliances at DreamWorks
  • Susan Carroll, Head of Global Infrastructure at Merck (a pharmaceutical company)
  • Dr Steve Pratt, CTO at CenterPoint Energy
  • Giles House, EVP and Chief Product Officer at Callidus (a SaaS-based sales performance management provider)

 

 

I think it’s an interesting and insightful session, but in case you don’t have time to watch it, I’ve summarised it below.


What did you get from your digital transformation efforts?
CenterPoint (Energy)
We got a much closer relationship with customers. CenterPoint can get an understanding of each individual customer, rather than having to treat them as averages.

On the supply side, digital technology allows CenterPoint to deliver higher uptime and to reduce risk [of energy supply failure].

Merck (Pharma)
Merck is able to move from “selling pills” to “creating health”. For example, with diabetes we have created an app for their customers. In other words, Merck has gone from product to service - from pill to “insulin-control service”. In doing so, we have a closer, more one to one, relationship with our customers.

jimj-merck.png

Drug trials have been “digitally enhanced” too. In the past, patients on trials had to fill out information on paper - what they had done, the weather, etc. Now, digital data from FitBits, weather feeds and water quality feeds can be automatically supplied. This means that Merck can bring safer products to market more quickly.

DreamWorks
Bringing an animation film to market is all about the artists. The trick is to use digital technology to help the artists, but to “get out of their way”. This was a tough challenge because when digital animation production started, the tools were difficult to use and most certainly didn’t “get out of the way”.


Does digital transformation require IT cultural shifts?
Merck : there is a change in IT speed required. Because digitization directly impacts the business and its customers, the business needs changes “at business speed”. IT is not used to working at these speeds.

The business knows that technology can help them, but they are not sure exactly how. IT has to work with the business to help them understand what is possible - what is “easy” and what is “hard”.

When we (IT and the business) use digital technology, we need to think “one experiment at a time”. This is different for us in IT. And, once we’ve done an experiment, we (IT and the business) may need to pivot - to change direction. In other words, it’s not a linear progression. Some steps “fail” and some steps cause us to move thru 90 degrees. We in IT have to get used to this way of working.


How do you balance between the creative needs of the business and IT?
DreamWorks : we want to be able to say “yes” to the creatives. We want to be able to help them realize any of their ideas.

The only way to do this is if we collaborate with them. But, when we’ve put the digital technology in place, was have to try to make it as invisible as possible. We need the digital technology to “get out of the way” so that the creatives can “do their thing” with technology gearing them, not frustrating them.

jimj-dreamworks.jpg

It’s all about the apps and data analytics, not about the IT platform” We in IT are used to thinking about the IT infrastructure we need to put in place. The business thinks about the digital apps and analytics it needs and they couldn’t care less about the IT infrastructure.


What insights could you share from your digital journeys?
Callidus : go for low-hanging fruit. Start small. Learn from each step. Move quickly and be agile.

CenterPoint Energy : the technology is changing very fast. So, you can’t boil the ocean [go for massive digital transformation projects] - just fill the tub with water.

Don’t forget the fundamentals that you as a business are good at. Use digital technology to do these things better.

You must be flexible. Things will sometimes go as you expect. But often, they won’t. This is not failure - it’s just the way it is with digital transformations.

Merck : digital transformation is not about digitizing an existing paper process. You need to start with the customer and redesign from the customer’s point of view  And help the business to re-imagine how things could be.

This is known as design thinking and both McKinsey and Gartner believe it’s an essential component of digital transformation.

DreamWorks : You need to think about the “customer experience” that the business has of IT.

Once IT has the right customer experience for the business, it can then think about the digital supply chain it needs to put in place behind that. For example, DreamWorks has massive, massive compute burst requirements when a movie is being rendered. DreamWorks achieves this thru bursting out to the public cloud. That’s now part of its digital supply chain.


How do you get the budget for your digital transformations?
CenterPoint : you must go for funding with a business case. The case must be about increasing business value or reducing business risk. It can’t be about saving money. Don’t talk about technology investments. Instead, talk about business investments (that happen to be digital technology).

Callidus : don’t go in with an ocean-boiling request. Start small and ask for incremental resource later.

jimj-callidus2.png 

DreamWorks : get the business to ask for the IT resource to work on digital technologies. The business asking for IT help is much more compelling than IT itself asking.


How does management measure a digital transformation project?
DreamWorks : prior to one of our digital projects, our studios could create five seconds of film a day. Management asked “after this project, how many seconds a day will you be able to produce?” The team replied, “we don’t know. We can’t predict”.

Because digital transformations are multi-step experiments, often in the dark, setting management goals is not always helpful. It is very tough to say to your management, your “bankers”, “I’ve no idea what you’ll get for your money”, but it’s what you have to do. Let the RIO realise itself. Let the digital transformation play itself out.

I’ve heard this a lot times from other customers. Upper management loves to ask “when will ‘it’ come out?” and “what will ‘it’ contain?”. Agile is a wonderful thing because it throws experiments against the tough test of reality on a regular basis, but unfortunately, reality doesn’t always like what’s been thrown at it, or it reacts in an unexpected way. This is why digital transformations work really well if high-level management is bought into them and understands the experimental, unpredictable nature of continuous innovation.


How do ensure that innovation occurs on digital transformation projects?
Stop thinking about the technology first. It’s all about the business - the customer experience, or making things safer, or taking out business risk, etc.

Give people the freedom to experiment. Once you’ve taken your first few experimental steps, you will gain confidence, but it all starts with giving your people the freedom and support to experiment.

jimj-centerpt-man.png

The technology is changing quickly. Someone needs to be always looking to the future.

McKinsey calls this “technology scouting” - having someone in IT constantly looking at what’s coming next. Companies like Google take this one stage further. They allow people a percentage of their time to play, and they ensure that they have playpens with all the latest "stuff" in them. 



Mike Shaw
Director Strategic Marketing
Hewlett Packard Enterprise

twitter.gif @mike_j_shaw
linkedin.gif Mike Shaw

Mike Shaw
Director Strategic Marketing

twitter.gif@mike_j_shaw
linkedin.gifMike Shaw

  • Digital_Transformation
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About the Author

mikeshaw747

Mike has been with HPE for 30 years. Half of that time was in research and development, mainly as an architect. The other 15 years has been spent in product management, product marketing, and now, strategic marketing. .

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