There are many challenges that come when attempting to transform a legacy brand into a modern customer-focused organization. Here are some tips for making the process simpler.
I am lucky to live in Silicon Valley and have the opportunity to be a part of the lively gatherings and discussions that occur as people come together to think through this changing world we are all a part of.
Last week I attended a particularly interesting event that I think you'll enjoy sharing in: The Churchill Club's open forum event "Business Transformation Insights and Strategies: D&B CEO Bob Carrigan with Advisory Geoffrey A. Moore" - two extremely well-known thought leaders who combined made for a fascinating discussion about business transformation. Bob Carrigan assumed the chief executive (CEO) role at Dun & Bradstreet eight months ago; prior to that he was CEO of IDG Communications. Geoffrey A. Moore is a renowned author focusing on market dynamics surrounding disruptive innovation; his books includeCrossing the Chasm and Escape Velocity.
The conversation was broadly centered on business transformation and some of the key elements Carrigan is focused on in his role as CEO for Dun & Bradstreet as he tackles the challenge of modernizing a legacy brand of a 173-year-old company into a modern customer-focused organization.
Third Platform Age
Moore explains that there are basically two reasons a company undergoes the terrifying process of transformation: 1) to catch the wave of the next big thing and if we don't transform we're going to miss it or 2) to react to an existential threat and a competitor will take our business away from us. He cites 45 iconic tech brands that he has worked with no longer exemplifying the high stakes of business transformation.
As we all know, cloud, mobile, social, and big data are changing everything from the way we shop to the way we interact - analyst firm IDC calls this the "Third Platform Age" (first platform: mainframe, second platform: client/server). For established organizations to survive and thrive as the pace of change quickens exponentially is a huge challenge as everything become more digital and Internet-based - creating the need to foundationally change how their businesses are run, especially as threats like commoditization and pure-play digital upstarts loom.
After spending time with numerous customers, Carrigan started his tenure by investing in innovation - that isdiverting returns - which can be difficult to explain to investors. One of the (I think brilliant) ways that Carrigan worked with his strategy team to look at investment options was to visualize the decision-making process by setting up a table with poker chips and different investment options. The strategy team physically moved the chips as they considered how to spend their investment dollars for the company, all the while keeping customer needs top of mind. Of course as some budgets are diverted to fund new projects; this raises the cultural issues that surround business transformation as it changes standard practices and the stakeholders who grasp onto the "this is how we've always done it" mentality.
In this modern organization transformation, Carrigan took some of the following actions:
- Creating a more transparent and flatter organization: reducing his direct reports from 13 to six
- Hiring of a chief people officer: someone new to the organization who is an experienced change agent focused on people and talent development, who looked at new compensation models, who was intentionally not "human resources" (this role is one of the six that report to Carrigan)
- Allowing for employee advocacy: their social media policy had been more restrictive than open; they now encourage employees to socially engage inside and outside of the organization
- Hiring the first chief marketing officer in D&B's 173-year history: recognizing that today the "medium is the message," that look and feel needs to be modern and crisp and clearly convey what the brand stands for (this role is one of the six that report to Carrigan)
- "Moving from arthritic to agile" infrastructure: look inside (customer-centric) out, instead of outside (company-centric) in to figure out what should no longer be done so that technology supports the strategy
- Thinking globally: breaking the silos of "U.S." vs. "rest-of-the-world" to address the growing global economy and his client's global growth needs, and the data consistency to support them
The Way Forward
Like many organizations in this Third Platform Age, D&B sees its future in the power of data. It is moving forward by holding on to its foundational value for its clients in the "DUNS Number" (the unique identifier in its global commercial database) and coopting data from other sources - like social data and interaction data - combining structured and unstructured data into system that can be leveraged by predictive analytics capabilities. Carrigan sees the company's evolution forward as a goal of "liberating content" (data) - making it more accessible to their customers: in the cloud, through easy API integration, and data feed services. They are hosting hackathons for API development and strategically acquiring companies (and with them "aqui-hired" talent) to support that goal.
As a professional immersed in these strategic changes around cloud, big data and analytics, mobile, and social daily as I approach my work, I found it fascinating to hear how a company with such a long history is transforming itself to compete in this hyper-competitive, digital landscape. I'd like to thank Bob Carrigan and Geoffrey A. Moore for an insightful conversation and The Churchill Club for organizing it. You can watch the full exchange here on YouTube.