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NYC 19 Conference Report May 14 - 15 | #TechonomyNYC

The Agile Enterprise: Talent, Culture, and Digital Transformation

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  • Drew Ianni of CDX with Max Furmanov of Accenture. Photo credit: Rebecca Greenfield

Speaker

Max Furmanov
Managing Director & Partner, Accenture

Drew Ianni
Founder & Chairman, CDX


Agile started as a software technique–to move quickly and iterate to achieve breakthroughs. Now entire companies can use the approach to make themselves more innovative. How does it work?

The following transcript has been lightly edited and condensed for ease of reading.

 

Drew Ianni: Good segue from digital transformation of New York City to—we’re going to talk a little bit about digital transformation. We’ve got a limited amount of time so let’s jump right in and why don’t you introduce yourself and tell us a little bit about what you do at Accenture.

Max Furmanov: I was worried we’d have to jump from like the geopolitical issues of China right into this and that would be a little more difficult. So Max Furmanov. I’m a managing director at Accenture. Been there for about 19 years now, and I run today our emerging technology practice globally, which is where we look at sort of new innovative technologies and how they’re helping drive innovation for our clients.

Ianni: That’s great, and thank you to Accenture for being a sponsor here. And SolutionsIQ is also part of that logo that you see around. And what is SolutionsIQ, just so we can get an idea?

Furmanov: Yeah, so like I said, I’ve been with Accenture for 19 years and over the course of the last, I would say 10, we’ve been on an acquisition spree. So SolutionsIQ is an organization we’ve acquired and it’s really kind of, I think, relevant to this topic because as our clients are pivoting to digital transformation and becoming what we think of as an agile business, SolutionsIQ plays a key role in that in helping transform not just the technology piece, which is historically where Accenture has really been strong, but also the culture, people, you know, operating model aspects of it. And that’s kind of, you know, us recognizing that, bringing in organizations like SolutionsIQ to help drive those services to our clients.

Ianni: That’s great. And you used to run the liquid applications studio and I’m just curious, what is it—what exactly is a liquid applications studio?

Furmanov: Yeah, so I was actually just remembering about that as I was hearing Kathy talk about kind of fin tech and what, you know, we do with the private public partnerships in New York City. The liquid applications studios is kind of our little incubation lab where we bring clients in and work with them to drive innovation, to experiment with technologies, to kind of showcase and demonstrate the culture and the, you know, physical aspects even of the environment that require you to do that and think differently. So I launched our liquid application studio network a couple of years ago. We now have something like 35 facilities across the globe with several thousand people dedicated to that where we work with our clients together.

Ianni: That’s great. So digital transformation, so I’ve been actually running an event on digital transformation for six years, so I have my own thoughts on the state of digital transformation, but I want to hear your thoughts on—so you know it’s, it’s become a buzzword, right? Everybody’s driving digital transformation. And we just heard what the city’s doing and the city’s doing great things. I’ll also plug Kate. I don’t know where Kate is. Kate spoke at my events before and JLab is doing phenomenal work, I think certainly a poster child for great things on the innovation and transformation front and helping lead J&J there. But you know, what is the state of digital transformation from your and Accenture’s perspective at a top line?

Furmanov: So to be honest with you, I’m not a big fan of the term digital transformation. And the reason I’m not is because it sort of implies that, you know, there’s an end state that you get to, right? So you go through this activity and now you’re digital, you’ve transformed, and you know, you’re successful. And I don’t think that’s the case at all. I think what’s happening with digital and organizations today is—you know, Accenture said in our tech vision a couple years ago that every business is a digital business. And what that means is that businesses are starting to use digital technologies to industrialize their operating processes and make them more efficient and more, you know, personalized, effective, et cetera. And they’re also creating digital services around physical products, even for companies that are not technical, right? They’re creating digital services around it.

So that’s what happening in digital space. But this notion that you will transform to get there is, I think is not a good one. And you know, for me, I’m running the Brooklyn half marathon on Saturday,  so running is top of mind and I think of it as, you know, not a race that you do, which when you say digital transformation, it sort of implies there’s an activity, you’re done with it, and that’s it. I think it’s the muscle you build to constantly do races.

Ianni: Right.

Furmanov: Right. And so that’s why I don’t like the term but I do think that digital transformation is a thing and businesses are starting to become, you know, increasingly more and more digital and it’s a really, really important part of, you know, technology.

Ianni: Right. And I think it’s also a misnomer in the sense of you know, I’m assuming, you know, a CEO of a Fortune 500 doesn’t call you or call Accenture and say, “I need to digitally transform my company.” It doesn’t start that way. It’s usually a project or a specific business or maybe they have a new business model innovation they want to try. But where’s a good starting point—if there’s a company out there or an institution, organization that knows they need to start to transform, where’s a good starting point for them?

Furmanov: Well, a good starting point’s always kind of small, right? It’s something you experiment with, you know, you do something in our liquid studios, we demo something. But you’d be surprised at how many people call you up and, you know, “I’ve read about digital transformation” in, you know, whatever blog it is. “So I want a digital transformation.” But I think really it’s about, you know, defining a business objective and starting out a small initiative to, you know, pilot that, prove out that it can work, you know, and scaling from there. So it’s always starting small and scaling, is what we see.

Ianni: And how do you—you know, sort of we talk about changing culture and my shows this year all focus on open innovation, so we’re dealing with a lot of the people in the labs and innovation centers and the people running challenges and competitions, and when I’m talking to a lot of these people who say, “Look, I’ve got buy-in at the top, and obviously I’ve got all the people here in the lab and everyone’s committed to it and want to do it,” and they say, “My challenge is that”—I heard one expression the other day called the frozen middle. Right, so the frozen middle of management. And you know, so of course you need an executive champion, we know that. Probably down at the ground level in terms of people, you have that. What has been successful in terms of transforming culture sort of in that middle to upper-middle management or senior management level, not necessarily in a C suite that’s bought in, to transform and get them to truly buy in and truly embrace changing the culture? What’s your advice?

Furmanov: You know, I think doing digital transformation for the sake of digital transformation is the wrong way to go about it, right? I mean, I think the key—and where we’ve seen this happen successfully is where there’s a business vision, where somebody lays out, you know, a vision for their customers or vision for some other constituency or vision for their business that you can rally around. And you know, I’ll tell you a great example. You know, I spent a number of years at Disney. Have you guys, anyone experienced a Disney Magic Band or heard of the Magic Band, right? It’s this new connected device that you go to Disneyworld and experience, you know, the parks through. So Accenture had a role, you know, in that. It was a very interesting experience for me, personally. I played a role in that as well. You know, once they had a vision for what kind of an experience they wanted to create for their customer, it suddenly became very easy to rally support all across the organization and get through some of the really hard stuff, like the technology piece of it, which is what I’m passionate about, but also, you know, the culture and talent and, you know, operating model aspects of it, which is what, like SolutionsIQ does and why we brought them in. So I think that is really key is having that vision, having that, you know, mandate that your organization can rally around.

Ianni: And also, I do want to get to the audience so think of a question. Ultimately, this is for you, so I’d like to get into the audience early. We talked about data and leveraging data to sort of unlock digital transformation and I know that’s actually what’s in the program and what you wanted to talk about. So share with the audience a little bit about that theory, sort of that premise.

Furmanov: Yeah, so like I said earlier, right, I’m not a big fan of the term digital transformation because I don’t think it’s about a destination you get to. I think it’s about building muscle, right, to constantly innovate, to constantly bring, you know, new capabilities to market, and doing it at speed. And I think that’s what, when we say agile enterprise, that’s what agile businesses, effective businesses do. But I think when you look at organizations today and how they start to think of themselves, you know, as becoming agile and adopting agility, they think of agile, you know, in the sense of the capital A agile. I’m going to run some scrum processes, I’m going to—

Ianni: And what’s scrum? Just for folks out there.

Furmanov: So scrum is a methodology, right, for executing technology implementation that has certain orchestrational elements to it. You know, you do standups every day and there’s certain processes you follow.

Ianni: It’s almost like a six sigma.

Furmanov: It is very much like it. And there’s others, right? There’s extreme programming, you know, methodologies. So a lot of organizations think, “I’m going to become agile by doing those things.” Well, guess what, just because you stand up at 9:00 every morning and talk about what you’re doing for 15 minutes, which is one of scrum’s methodologies, you don’t become an agile business. So to become an agile business kind of with the lower case a, right, you need to think about not just the orchestration of agile methods, but also think about how to remove some of the technology inhibitors that are driving that. And I think that’s where data comes in because, you know, organizations are—if you look at historic organizations, they really have an edge over companies even like the startups of the world, like the Ubers of the world, because of the data they have about their customers. So we talk about the power of data, you know, big data, artificial intelligence, analytics, right? Those are hot topics. We also talk about innovative technologies like blockchain and, you know, things like IOT technologies and AI. We don’t talk about those two things coming together, right? Many organizations can go and build a blockchain demo very quickly. Very few organizations can actually tie that to data they have and make it relevant to their customers, personalized to their customers, right? And so when you look at something like Disney, you know, the hard part about that connected experience that we created for Disney was not the sensors that were in the parks that were tracking where the people were. The hard part was integrating that with the data sitting in their dated legacy systems, right, and making that data useful. And that’s the hard part and that is what prevents organizations from being agile. And I think to become agile, to really go through a digital transformation, you really have to figure out how to unlock that value, how to remove the constraint you have from your core systems that are housing data, and make it useful.

Ianni: And can you share, for whatever you can share with the Disney relationship, you know, how do you transform the culture in the enterprise or the structure of the organization to actually make that data actionable or to act on that data? Because it’s one thing to create a bunch of systems and integrate your data and then we’ve got all these actionable insights, but is there anything that these companies are doing within their organization? Are they having new people sort of own sort of the collected data? But in terms of making that data actionable and actually extracting that value, sort of at a really tactical level, how do you do that?

Furmanov: Yeah, so at a very tactical level, I think it’s hard. Because, you know, there’s all sorts of—obviously there’s sensitivity, you know, from a legal standpoint and how people feel about their personalized data. But also, you know, this creepiness factor. So like when we were working at Disney, I remember one element of it was we were able to provide so much data about guests that Disney was actually worried about how creepy that would be. So like when you’re in the park, you can walk up to a cast member and say, “Hey, I’d like to know where the nearest restaurant is where I can get pasta” or whatever, right? And before the Magic Band, Disney had no idea who you were, right? So you’re coming up to them, they have no idea who you are. Today, when you come up to them, the band actually informs, you know, their iPad and pulls up all this data about you. And they were very cautious in how to use that data.

Ianni: Right.

Furmanov: And even calling you out by name, you know, they did some studies and apparently, you know, if you go up to them and they say, “Hey, Drew, we know you’re staying at this hotel,” that freaks you out. If they call your kid out by name, by the way, that doesn’t seem to bother anyone. Only if it’s you. So there’s some weirdness to how—

Ianni: Yeah, if Mickey walks up and says, “Hey”—

estiFurmanov: Yeah, like if Cinderella walks up to your daughter and says, “Happy birthday, Julie,” like, you’re okay with that. But if they know your name, that seems to be a problem.

Ianni: Right.

Furmanov: So anyway, so like how you treat data is really important. And thinking through that is critical. But also, you know, enabling technologically to have access to that data is really what’s going to drive—

Ianni: And before I go to the audience, we should also think about GDPR, you know, the data sort of protections in Europe, which are coming to the US in some capacity.

Furmanov: Yes.

Ianni: California maybe leading the way. It’s mainly be advertising-driven, sort of email marketing-driven, but that’s also going to have an impact in terms of what Disney can use with its own first party data and communicating with people and I think it’s really important that everybody watch that.

All right, time’s zipping by. We got a couple minutes, so let’s get to a couple questions. In the back, if you can just wait for the mic and also introduce yourself once it arrives, thank you.

Audience 1: Thank you. Hi, Julia McAllister from Dev Method [[INDISCERNIBLE 12:15]. So I have a question. With agile methodologies, it often requires rapid iteration, but also when working with a bigger company, you do have to budget and plan for the projects that you’re starting. Have you found a process that is effective for estimating how long a bigger project will take while also using agile methodologies once you actually kick that project off?

Furmanov: Yeah. So actually, really glad—thank you for asking that question. I think it’s a really important element for organizations to become agile is not just look at technology, culture, and talent, but also think about how does it fit into the bigger processes, right? And there absolutely are, you know, methods and mechanisms for doing that, you know, scaled agile, safe methodologies. You know, not my favorite, but a way of doing it. But I think the key thing is that you have to think about those things. Because you’re absolutely right, for traditional organizations, historic organizations, large, complex organizations, you know, they have very traditional processes for dealing with that—how do you do funding, how do you do all those things—and they need to start to pivot and change that because if they’re not doing that but only talking about, you know, how to be agile and how to apply certain methods, and even how to apply certain technologies, they’re really not transforming themselves. They’re really not becoming agile. They’re really not going to be able to respond to the market. So you know, that is a really key element I would say. You know, even how you’re organized, right, is often contrary to becoming a more agile enterprise and organization. So these are all the things they have to think through. And actually, SolutionsIQ, one of the reasons we acquired them is because they have a point of view, methodologies, and ways of solving these problems, both for things like funding and organizational effectiveness, et cetera.

Ianni: We’ve got time for one more. Did we answer all the questions? Oh, we’ve got one.

Audience 2: I would really like to dig into that analogy about running the marathon and the muscles. What would you consider the muscles? I’m serious. I mean, is it the people? Is it the data? Is it the decision making process? Is it the reaction time?

Furmanov: Yeah, so, great question, actually. I think it’s really a couple of things. I think one is it is how you’re organized, how you’re operating as an organization. Where does control sit? And specifically, thinking about how to start to shift from being a traditional kind of pillar-based organization, where you have different business units and IT and things like that, to being more product-focused and really tying, you know, how you’re operating to outcomes that your customers ultimately consume. I think that’s one key element of it.

I think the other key element of it is technology and building the right foundation to get at the data you have in your enterprise in a very rapid way, right? Somebody said, “It’s about iteration, it’s about doing things very quickly.” Well, to do things quickly, you also need access to data quickly and one of the things, you know, we faced at Disney was, every time we needed access to you know, their retail system or their hotel management system, it’d be like, “Yeah, no problem, we can give you access to that. It will take six months and $5 million dollars,” right? So there’s a lot of technology today to get past that. And we often, you know, we think about technology implementation as these like individual projects, but we need to start to think about the overall enterprise architecture to enable that. And that’s the second piece.

And then the third element I would say is the talent and culture that needs to really transform for organizations.

Ianni: And my unsolicited parting shot with that is, over six years of doing these events in digital transformation, from chief digital officers to chief marketing officers to chief innovation officers, heads of open innovation, I always ask them, “How often do you interface with HR?”

Furmanov: Yeah.

Ianni: Never. And you know, it’s all about culture transformation. It’s insane to me. Every board should have the CHRO on the board. To me, it’s insane that it doesn’t happen. And then they’ll get up on stage and say, “My biggest problem is talent.” Or “My biggest problem is changing culture.” Anyway, so that’s just my unsolicited rant.

Furmanov: No, I think that’s absolutely right. We have an agile HR kind of practice area and one of the things they tell me is that, most people don’t realize this, but you know, most people today are not incentivized primarily by monetary rewards. And that’s a very interesting, you know, thing. So people go and talk to HR when there is reward problems, right, compensation problems. But that’s actually not what incentivizes most people today. So it’s really important.

Ianni: That’s right. All right, we’ve got to wrap. Thanks very much.

Furmanov: Thanks.

[APPLAUSE]

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