Chapter 10
Staying Current
“Where could we use blockchain at P&G?” I recall asking a couple of smart start-up founders in June 2015. We were at their Silicon Valley offices, which had glass conference rooms hung from the ceiling over an atrium. It looked as futuristic as blockchain technology, which is essentially a secure chain of data blocks, each connected to the one before it, fully verified and managed without a central authority. It’s fascinating because it is considered to be unhackable. It has the ability to correctly and securely log any transaction, thus eliminating processes such as validation and reconciliation. That’s relevant since most operations in any enterprise are done as transactions—whether placing an order or paying for it. If transactions could be made accurate and secure from their earliest source to their last destination (for example, from sourcing potatoes in Peru to selling chips in the UK), that would certainly disrupt the way enterprises ran their operations.
The brainstorming that followed my question was intellectually stimulating but unsatisfying. Uses could include tracking discount coupons, advertising, creating a P&G cryptocurrency to ease intracompany transactions and sales across countries, and so on. The problem was, none of these were available as solutions even in their basic forms. The current products of the start-up were all aimed at the average consumer (e.g., how to pay for coffee at the store). I left the meeting having mentally filed away blockchain as a powerful technology that was not ripe for primetime in the enterprise.
Six months later, I ran across the same start-up. Their current product offerings included several enterprise-related blockchain solutions, including tracking international shipping from corporate suppliers, highly secure financial accounting, and anti-counterfeiting certification of consumer products. Although I was delighted at the progress, it also left me slightly disheartened. If I, in my transformation leader role, found it hard to stay current with the pace of change in technology, then how would the average operational leader cope?
Staying Current in a Volatile Digital World
Keeping track of all the sources of disruption and the exciting possibilities in a digital world can seem like an impossible task. That’s true for us in our role as consumers as it is in our professional lives as, say, entrepreneurs/executives/public sector leaders. The explosive growth of capabilities in digital technology is mind-boggling. A teenager has more computing power available on his or her smartphone today than President Bill Clinton had at his disposal while in office. They can make phone calls for free to Asia or Africa over WhatsApp—calls that used to cost $3 per minute thirty years ago.
In our lives as consumers, we see real-time financial and sports updates posted on Yahoo. Each of these is a short, similar-sounding paragraph. That makes total sense, since 90 percent of them are written by robots. I read tweets from the police in my city of Cincinnati that say, “Shooting in Avondale tonight, victim lied about where it occurred until confronted with @shotspotter evidence! @CinciPD.” ShotSpotter is the acoustic triangulation technology used in London, New York, and other cities that use analytics to accurately pinpoint where shots are fired and directs the police to these locations in real time.
As a business executive, I see large tech-savvy customers make accounts receivables claims that can number in the thousands for each order—each claim being worth as little as a few cents. Clearly, these are being generated by robots. It wouldn’t be cost-effective for a human to create these micro-transactions worth a few cents each.
In our NGS scouting trips for solutions for P&G, I saw AI that could replace experienced lawyers on highly personalized contract negotiations and robotic products originally created for defense applications that could rival Robocop. There were automated meeting rooms that could recognize you as you entered and start up the upcoming videoconference meeting on your calendar without a single click. I saw solutions that could make the whole chore of creating travel expense reports an archaic practice from the past and real-time language translation capabilities that could beat experienced humans. It can seem a bit overwhelming to an executive who needs to understand what’s possible first and then decide where to focus.
Insights on Where to Stay Current
It’s obviously a waste of time and effort to try and be on top of every new digital development. Through my work over the years, I have realized that there are some principles that can help us stay current in a focused manner. This applies equally to staying current on knowledge as well as on using disruptive product capabilities.
Track possible disruptions, but invest only in applied innovation:
At P&G, I first came across picture-taking technology to recognize products on retail store shelves in 2007 that could quickly tell manufacturers if their products were out of stock or incorrectly shelved. It was an interesting concept that was not ready for application.
We checked it out every year after that until it suddenly became sufficiently mature for use in 2010. After that, we moved rapidly to deploy.
Take the slow train that’s here instead of a fast train that might come later: This was an interesting analogy that arose during a conversation with Salim Ismail. On disruptive technology, it’s usually better to jump onto a slow train that’s here and working rather than wait on the promise of a faster train that might come later. It delivers benefits faster, since no solution is permanent anyway. In other words, don’t wait to start experimenting if the current product is already viable, even if imperfect.
Go for quick “disposable” solutions that pay out quickly: This is a corollary to the previous “slow train” principle. The risk of losing money with an imperfect disruptive solution is mitigated if it pays out in a year or two anyway.
These principles have helped me on assessing and selecting where to focus. However, there’s still the question of how to stay pragmatically current. In the following section I propose a few ideas. Additionally, to help with a quick update on the current state, appendix B at the end of the book provides a basic primer on a few select exponential technologies that are most likely to be disruptive to enterprises. I call these the “Exponential Five,” and they include artificial intelligence, blockchain, smart process automation, drones and robotics, and industry-specific special-function exponential technologies such as genome editing.
The Discipline of How to Stay Current on Digital Technologies
The discipline of how to stay pragmatically current is not time consuming and can be built into the day-to-day routine of leaders. Here are a few activities that can be woven into the processes of every enterprise. I have found these to be extremely effective.
Creating executive learning opportunities
Partnering with venture capitalists (VCs) and start-ups
Leveraging partners for education
Opening up your data via APIs (data gateways) to others
Enlisting the help of digital ambassadors (tech-savvy users) Let’s break down each one.
Creating Executive Learning Opportunities
Throughout my P&G career, I blocked out time every month to meet experts on digital technologies. This was in addition to reading books and online articles. The actual tactics varied with my role but included a combination of the following:
Reverse mentoring: During my NGS role, I was very fortunate to have some of the best industry experts from other companies assigned to our team. I found our conversations over lunch or happy hour to be the best learning opportunities of my career. An offshoot of this approach can be peer mentoring, where a more senior person from the IT organization or an external agency can do the same.
There’s no better way to get the organization moving on staying current than by setting an example.
Defining disruptive problems: Engaging more frequently on defining specific disruptive problems is another win-win method. In NGS, our informal open-office culture helped. All sorts of problems were discussed in the open forum. Though I contributed my business experience into those discussions to help routine problem solving, I learned a tremendous amount about digital possibilities.
Adjacent or complementary industry pairing: NGS set up an alliance of about ten large company shared services organizations, called the Shared Services Innovation Alliance, to share the most disruptive ideas across the group. We met every six months, and the small group discussions were priceless.
Organizing advisory resources: Another effective mechanism is to organize advisory ecosystems on specific topics. The resources from Singularity University (SU) were particularly valuable here. I consider the bigger challenge of digital transformation to be change management, and here the SU network, including John Hagel III, was extremely helpful.
Partnering with Venture Capitalists and Start-Ups
Ninety percent of all the disruptive ideas that we worked on at NGS came from start-ups. This was true even though the NGS ecosystem included the world’s best large digital companies. That’s understandable, because disruption is what start-ups do. To tap into this, we set up a simple process. Every big GBS opportunity would promptly be summarized into a short paragraph and emailed to our venture capital partners. Our VCs were excellent in connecting us with start-ups working in that domain, and the subsequent dialogue produced very useful insights and business relationships.
There’s a highly symbiotic relationship between VCs/start-ups and larger enterprises. VCs and start-ups need feedback from real “user” organizations, and enterprises need the latest thinking from them. Setting up periodic connections (e.g., a VC/start-up day) on-site at your organization (yes, they are willing to travel to you!) or organizing targeted visits to VC sites every six to twelve months would be a good start.
Setting up a periodic drumbeat of assigning your major partner companies a digital literacy slot in your organization can be beneficial to all organizations concerned.
Leveraging Partner Companies for Education
In the NGS team, we created a calendar of monthly slots on “hot technology” topics and offered both vendors and internal experts the opportunity to share knowledge in short bursts. Most partner companies are very eager to take advantage of free opportunities to bring in experts to client companies in the hope of establishing a strong equity of expertise. Setting up a periodic drumbeat of assigning your major partner companies a digital literacy slot in your organization can be beneficial to all organizations concerned.
Opening Up Your Data to Others Via Application Program Interfaces (APIs)
This is a highly innovative way to generate “applied” innovation and stay current at the same time. Here’s how this works. Invite a targeted number of technical resources and software developers to access relevant data within your enterprise to either solve specific problems or even develop innovative uses based on it. Set up commercial agreements ahead of time to compensate and reward people for coming up with the most breakthrough ideas and apps. Access to data can be provided via secure APIs, which are gateway tools for others to either tap into specific data or talk to your programs. Once this competitive marketplace is set up, the creativity explodes. The capacity of the organization to attract and receive a large number of apps grows exponentially. Several large companies, including AT&T, Walmart, and FedEx, have created such API-based developer networks. At NGS, we created some crowdsourced prize-type opportunities using nonsensitive data even without creating an API portal.
Open up relevant data access via APIs to select internal and external developers and set up commercial models for them to benefit from the breakthrough apps they create.
Enlisting the Help of Digital Ambassadors (Tech-Savvy Users)
At P&G, we used our most tech-savvy users to occasionally train others or lead IT road shows in targeted areas. They loved the opportunity to be recognized for their IT expertise, and we were able to multiply the capacity of the IT function to quickly scale up operations using valuable experts.
Expert users from functions other than IT can be a great extension of your digital literacy army.
Chapter Summary
Even the best digital transformation ideas can fail to take root in the organization that doesn’t have the capability to best use them. In several cases, this is due to a lack of understanding of the digital capabilities. This is a tough problem because of the pace of change of digital technology.
Certain principles for staying current on digital capabilities can help. These include the following:
Track possible disruptions, but invest only in applied innovation.
Take the slow train that’s here instead of a fast train that might come later.
Go for quick “disposable” solutions that pay out quickly.
There are disciplined ways to help the organization stay current on technology. This chapter offers five techniques.
Creating executive learning opportunities
Partnering with VCs and start-ups
Leveraging partners for education
Opening up your data via APIs to others
Enlisting the help of digital ambassadors (tech-savvy users)
The technologies that are most likely to disrupt fall in the category of exponential technologies, i.e., technologies whose capabilities grow exponentially. Appendix B provides a quick primer on my pick of the most disruptive digital technologies. In summary they are:
Artificial intelligence: This is the most pervasive digital disruptive capability.
Smart process automation: This may be a low-hanging fruit for enterprise efficiency, but it also has significant capabilities to build agility of operations.
Blockchain: Its combination of decentralized transactions, easy access to many parties, and extremely high security has the ability to disrupt just about any transactional activity system.
Robotics and drones: Robotics and drones will disrupt any task that needs physical seeing, sensing, assisting, moving, measuring, or delivering—including those that need to be executed remotely.
Special-function technologies (virtual reality, 3D printing, Internet of Things, nanotech, energy storage, biotechnology, advanced materials, etc.): Just about every industry has one or more of these that will disrupt its business model. The key is to identify and target the ones to invest in.
Your Disciplines Checklist
Evaluate your digital transformation against the questions in figure 22 to follow a disciplined approach to each step in Digital Transformation 5.0.
Figure 22 Your disciplines checklist for staying current