Catalyst

Covid-19 could be an accelerant to digital transformation

Chitra Narayanan | Updated on April 02, 2020 Published on April 02, 2020

Nigel Vaz, Global CEO, Publicis Sapient

The transformation will be driven by three factors, says Nigel Vaz, Global CEO of Publicis Sapient

For Nigel Vaz, the London-based Global CEO of Publicis Sapient, it has been an eventful one year of leading the digital business transformation company. The 30-year-old company has itself gone through several business transformations — starting life as a tech consulting company, then focusing on brand experiences and now exiting marketing services and strengthening its capabilities in data/AI and engineering. Vaz shares his perspectives on what it takes to digitally transform as well as Publicis Sapient’s own evolution. Excerpts:

Do you think Covid 19 will accelerate the digital transformation journey of companies?

Absolutely. We think about digital transformation being driven by three factors.

1) Changing human behaviour: If you look back, the advent of internet led to change in businesses. In India, it was mobile telephony that led to people’s behaviour changing and forced business changes

2) Technology: This made it all possible.

3) Business models: When new behaviour kicks in and technology changes, it leads to new business models. Twenty years ago, it was incredible to think you could be sharing your house with a stranger. Or that the biggest automobile company would not own a car but be transporting other people. Be it Airbnb or Uber, there are many such examples of new behaviour-led, tech-enabled, business models.

What you are seeing currently is a dramatic escalation of human behaviour dynamics. Even somebody who used to say, ‘I have to work from office because that is the only way we know how to’ is able to work from home. In healthcare services, banking, e-tailing, we are seeing numbers going through the roof in terms of adoption of digital systems, and platforms. There is huge adoption even among the elderly.

I won’t say Covid-19 will be the reason for the take-off of digital transformation, but this could be yet another major accelerant because during this period most people have figured out how to do things they were uncomfortable with. Now we don’t have a choice.

What about the other barriers that have inhibited companies from transforming themselves?

A lot of people equate digital transformation with an IT project or a digital project. For us, digital transformation is not a destination but a journey. Every company is in a different point of this journey. Even most advanced technology companies like Microsoft are transforming themselves to be even more digital — if you look at the way they are moving their businesses to cloud.

At the other end we have traditional manufacturing businesses that are still taking the first steps in digital adoption. They are at a different point in the journey. For one company in the very basic stage, there is so much transformation to do, for others the shift is to something new in digital. So there are challenges and challenges in digital transformation.

Then we see situations such as in India, where companies leapfrogged an entire generation of tech. Mobility is the trend that really accelerated the digital transformation in India. It works in different countries, different ways. If an India company were to launch an e-commerce app, it wouldn’t lodge it in a website but mobile first, but that may not happen in America.

The other challenge with digital transformation is that lots of companies have a wrong culture, wrong incentive, philosophy. A lot of companies think of tech and IT as being about risk and cost. The mindset is keep the risk down and keep the cost low.

Today, to me, technology is moving from risk and cost to value and differentiation, which is actually how tech is going to give the biggest advantage. What can I do that competition cannot.

There are still a lot of companies in the risk and cost stage. Not everybody is thinking of technology in the way, say, an Amazon does because that is part of their core and operation.

Publicis Sapient’s own evolution in the last 30 years has been interesting — can you outline reasons for these transformations?

We exist primarily to serve our clients. We are 30 years old and you could look at the company in three decadal slices.

In the first third, we were talking about fundamentally internet-enabled business, helping companies leverage the internet to change their business. In the first third, for most companies, internet and digital was a small percentage of their revenues. For retailers and small companies, they knew they needed a website. We were shifting people’s ideas in banks, trading houses, etc, but they were still small shifts.

In the second third, our focus was on experiences. The user experience is fundamentally the brand. If I am going to a bank and try its mobile app, the app would define the brand. If I were Taj Hotels and a customer tries to book a room on my website, the booking experience of the customer is the brand.

Till then, brand-building was advertising, marketing, storytelling. But what we were offering was brand-building through actual experience. What happens when you are travelling an airline and your luggage goes missing? That will take away the promise of the airline brand.

But both in the first third and second third of our existence, we were not actually touching the client’s product. Now, as we help clients digitally transform their businesses, we are deep inside the companies, actually working the product, or the service.

Can we use AI to reorganise the entire customer journey for a bank providing housing loans? The way it worked in the past is, you go see a house; by the time you fill in the paper work, sew the mortgage, somebody would buy the house.

Now if you are the bank, you would be helping me buy the house by getting all the information upfront.

If you are an airline customer, you can now pick your own seat. The business case for the creation of the seat map was to avoid too many calls landing at call centre asking to block seat and faster turnaround in the airport. But today, one of the largest non-ticket revenue streams for airlines is the price to select your seats. It is a digital product. So you can see the journey from where it began to where it is today.

In this shift, how have your talent needs changed and how have you managed to get the capabilities you need among your employees?

If I take a human example, outside of business, the way we think about our workforce today is the way we think about raising kids. Earlier when we raised kids, first third of their lives they studied, then next third they worked, and the last third they retired and enjoyed.

But today what we are teaching the kid is that the learning is going to continue. By the time the kid finishes the first four years of university, the first job is obsolete.

We look at people with deep strategy and consulting experience so they really understand our clients. You can’t transform something unless you know how it was and how it will be. You have to have that context.

The second thing we look for is experience and design capabilities. Third is engineering skills. Fourth is Product knowhow — the ability to think about a product not as a project but as a product that keeps evolving with time.

The last skill set is data and AI. We are basically saying all the decisions you are taking, whether designing or writing a system, all should be in the context of data. Now we provide a lot of data-driven design.

When we look at the evolution of skills in our creative team over the years, it has moved from information architecture and content strategy to computational design.

A lot of upskilling has to happen for a company to digitally transform, But in tough times like these, training budgets get cut first. So how do companies meet this challenge?

We don’t have a training budget. At least we don’t put it in a bucket called training. We basically put it in the development bucket. What was change management? The origin came from training. A group of people said a process has ten steps, now let us cut it down to five steps and write down a training manual for the organisation to run a change management programme.

Today, the work we are doing is too quick and rapid to go the old way of training. Our model is more like “Players and coaches”. You identify the raw skills and capabilities people have and the gap they have and match it with capabilities we have. So we co-create with our clients.

For example, if Client A has 10 people, we find out which of our people fit those skills and together they become part of a transformation team. They have real work to do.

Transformation is not something you can do for somebody. You have to do it with somebody.

Published on April 02, 2020

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