How New Technology Trends Disrupt the Very Nature of Business

Transcript of a discussion on how major new trends and technology are translating into disruption, and for the innovative business -- opportunity.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.

Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you’re listening to BriefingsDirect.

Gardner

Our next technology innovation thought leadership discussion focuses on how major new trends in technology are translating into disruption, and for the innovative business -- opportunity.

From invisible robots, to drones as data servers -- from virtual reality to driverless cars -- technology innovation is faster than ever, impacting us everywhere, broadening our knowledge, and newly augmenting processes and commerce. We'll now explore the ways that these technology innovations translate into business impacts, and how consumers and suppliers of services and goods can best prepare.

To learn more about the future of business innovation, we’re joined by two guests, Greg Williams, Deputy Editor of WIRED UK, and Alex Atzberger, President of SAP Ariba.

Greg, as we see a lot of trends happening, a lot of change in the industry, people talk about the pace picking up quicker than ever. What are some of the major disrupting trends that you see in technology, and then which of those do you think are going to be the most impactful for business people?

Greg Williams: You listed a whole bunch of things, which are all incredibly important in moving forward. They're near-term in ways that sometimes people don’t consider them to be near-term. Technology shifts tend to be almost things we don’t notice. They're not happening slowly any longer; they're happening quickly, and we're almost not seeing them.

Atzberger

We talk about something like robotics. Now, you can see all kinds of incredible things. You can see in Japan a robot caregiver that can lift elderly people out of their beds and can care for them in that way. You can see slightly sinister videos from Boston Dynamics of robot dogs running along that look pretty scary. But what most innovation looks like are things that we almost don’t notice are there.

For instance, and this is a boring example, an ATM is kind of a robot; a vacuum cleaner is; an elevator is. Those are things we don’t necessarily notice. They're not as dramatic as we think.

I should just caveat that and say that everything is moving very, very quickly right now. That's why it’s hard to make very clear predictions.

The other thing that’s important is this joining up of lots of different technologies. That’s the biggest trend that I see right now. We can talk about satellites and drones, which are effectively servers in the sky or we can talk about autonomous mobility and augmented reality, but it’s all about connecting the dots.

Technology players

One thing that's interesting now is the way that car manufacturers are all technology players. Every automotive manufacturer is figuring out that what they have is a computer on wheels. They have to figure out how, when people drive into a parking lot, they make an automatic payment via the vehicle. How can the vehicle know that people’s groceries are ready to be picked up at a certain point.

Williams

Although it’s nice to list robots and autonomous vehicles and other clear technological shifts, the thing that we're really seeing is the speeding up and this coming together, this joining and connecting of the dots. Basically, all are based on three things: ubiquitous computing, mobile technology, and the cloud. Those three things underpin pretty much everything that we're going to be talking about in the next 20 minutes.

Gardner: Alex, when I hear Greg, I'm thinking business networks, although people in the consumer space might not think of them as business networks. It’s the network effect, it’s intelligence shared, it’s linking things up and allowing the pace to increase and people to share knowledge and activities. What do you see as the crossover from the consumer space in the behaviors and culture of technology and then how does that translate to the business idea of a network?

Alex Atzberger: I was recently in Dubai, and they have a Museum of the Future that they're launching this year. In the Museum of the Future, you can see what it would be like to be going to a doctor to get a new body part to jump higher or move faster. You look at these types of ideas, and the business embraces the same sort of idea. How can I augment my business to actually run smarter and be better? What are things on which I can augment myself to use data better?

You can no longer be an island as a company. You need to share ideas and innovation with others.

You can no longer be an island as a company. You need to share ideas and innovation with others. You need to be connected, and when you're connected, you can transform your business, you can do new things, you can take on new capabilities, and you can augment your business.

Companies ask us, "Now that I'm connected to a network, how can I get data out of that network to improve my business processes and do things better?" That's what they basically call the augmented enterprise, to get augmented intelligence to that business.

Gardner: We're seeing different patterns, not only in adoption, but expectations. People are seeing a mobile device tied to a cloud that has deep learning capabilities, and feedback loops that are applying the data back and forth. People are becoming ready for the next move. They want the technology to guide them. And they also don't want to take the time to learn a process; it has to be intuitive to them.

So how do these human behavioral aspects of anticipating a proactive technological helping hand impact both us in our consumer space, as well as what we would expect in our business environment?

Simplicity is key

Williams: Simplicity is absolutely key to all technology. We have to think about the end user. The end user or the customer is always the most important thing in any kind of technology process.

Going back to what Alex was talking about in terms of artificial intelligence (AI), what it’s going to allow us to do is be a lot more predictive in terms of consumer behavior and customer behavior.

If you look at something like natural language processing now, some of the startups in that space who are working with automotive manufacturers, to go back to my previous example, they will look at trends on social media and elsewhere. They can look at import and export data maybe and they can look at those predictive trends and make predictions about General Motors, their sales in the next quarter.

From the sky, we can look at parking lots at malls like Target, Costco, and Walmart and we can make predictions about how the quarterly earnings report for Walmart or whatever is going to be pretty strong this quarter.

Simplicity is absolutely key to all technology. We have to think about the end user.

What we are looking at is this constant connecting of the dots, and to Alex’s point, this incredible accumulation of data. That’s the real tough thing for businesses right now. I don’t think there’s any business out there that doesn’t understand the value of data. This phrase "big data" is one that you'll hear at every single conference, but how can we possibly parse value out of that? How can we use that data in a predictive way, rather than as a lagging indicator?

Most businesses have used data as a historical indicator. So, it's looking at sales reports or whatever other data is important within your organization. How we can use all those external factors is going to become increasingly important for businesses. Can we see how our competitors are doing by looking at the job postings that they have maybe? How can we see what their next move is in terms of manufacturing by looking at their import/export data? Can we look at the amount of money they're spending on Google AdWords and see what keywords they're spending money on?

As I said previously, it’s about connecting of the dots and bringing this information together, and also figuring it out, having someone within your organization who's not going to get overwhelmed by this data, but is curating it, and knows what’s important and what’s not important to the enterprise, because a lot of it isn’t.

Gardner: User experience plays a huge role in how we can consume and make good on this technology, on this data, on this analysis. What Greg said about simplicity can be deceiving. It might seem simple to the end user, but an awful lot has to happen in order for that effect to take place.

So Alex, one of the interesting things I've seen with SAP Ariba recently is this notion of Guided Buying. I love that word "guided," because you're anticipating the user, heading them off on complexity, but what does it take behind-the-scenes to actually make that happen?

Guided Buying

Atzberger: There’s a whole lot that it takes to get this going. The idea of Guided Buying was always that simplicity that all customers are asking us for. It’s really about how I make the user feel empowered and give the power to the user, but at the same time, embed intelligence in the software.

In our cloud applications, we thought through every step of the process, starting with monitoring how users were behaving with the system. So it’s a design thinking approach, and it starts off with deep empathy with the user. That’s the first point.

The second point is understanding what the business actually wants to accomplish, because the business actually runs a business. They have rules, methodologies, things that they want to achieve.

I was with one CPO who told me, "Alex, I look at this beautiful software, but you're making it too easy to buy. I don’t want people to just go out and buy stuff." That’s absolutely a good point, but what we're doing is embedding the logic of the buying in the enterprise into Guided Buying. That’s the difference between B2C and B2B.

The idea of Guided Buying was always that simplicity that all customers are asking us for. It’s really about how I make the user feel empowered and give the power to the user, but at the same time, embed intelligence in the software.

In B2C you can have that beautiful experience. You just want to make the experience so seamless that you drive commerce. In B2B, you want to guide the commerce, to be more relevant and fit your company goals. That requires a slightly different approach to how you solve that problem. We're obviously deeply committed to solving that problem in the context of giving users as much freedom and choice as possible while enabling the business to achieve their goals.

Williams: Alex used a really great phrase and it’s one that we actually had a discussion about in the office, which is the importance of design thinking within organizations. When you think about software or any technology, the user experience is your brand. So, it’s the people experiencing it.

Pretty much in every organization now, the "design brief" is a really important part of the organization. Maybe designers need to be brought in, whether they're software designers or in the B2C space, UX designers. They need to have a seat at the top table these days, because they're such an integral part of defining any kind of brand.

Atzberger: We hire a lot of designers into SAP Ariba, but interestingly, a lot of the engineers come and say they need to think about design as well. So, it’s not like design is still a separate department. At one point, design becomes part of what we call a scrum team that basically builds the software, and an engineer should have a point of view as well in terms of what is good design.

You could argue that there are some sites that don’t necessarily look pretty, but they're really easy to use. So, it’s not just about the visualization and the fonts, etc.; it’s about also how many clicks and the logic behind it. That’s where product people want to be product people. They don’t want to just be engineers or just designers.

Important element

Gardner: I suppose another important element to this is not only that user experience where one-size-fits-all, but a user experience where customization is brought to bear, and because of the technology, because of the intelligence, access to a cloud infrastructure, we can do that. There are examples of customization at the individual worker level, where role-based and policy-based approaches can do that.

We're also seeing with the SAP Ariba cloud, you're bringing master data, vendor data, for example, into the cloud, cleansing it, making it usable, but still keeping it germane to that particular company, so that this isn’t just a business app for everyone. Let’s delve a little bit into this idea of customization specifically to a company and then even down to the individual user. How is that so important now in business applications, Alex?

Atzberger: The premise of the cloud was always speed. What you gave up for the speed was the ability to customize, especially in enterprise systems. What we're now saying is that you can have a level of individuality and things that are important to you, either through configuration or through extending the platform that you're on.

That’s the power of the technology that comes to bear when you look at platforms today. If you look at Amazon Web Services or what SAP is doing with the HANA Cloud Platform, it’s essential, because it gives the capabilities to companies to actually customize further.

At the same time, we have a concept of the private and the public persona, because at the end of the day, there is some data that’s private to a company and then there's data that's publicly shared. We need to be very sensitive of what data is relevant and in what context.

Gardner: Greg, one of the areas where business can get out in front of the technology curve is this idea of customization and anticipatory or predictive analytics’ benefits. It seems that we're only scratching the surface here. When I go on Netflix, they still can’t pick shows that I really want to watch. When I go to Amazon and they have My Box or My Stuff, it's really just things I already bought with a little bit of augmentation.

What we're now saying is that you can have a level of individuality and things that are important to you, either through configuration or through extending the platform that you're on.

If we can take this to the full potential of customization, and I think businesses can because they have access to the data and they can be policy-based and in probably a better way than a mass consumer environment could, what’s the potential here, when the machines can really start getting us customization, predictive analytics, and apply that to how we get productive in our business sense? It strikes me as something quite significant?

Williams: Yeah, it is. I was talking to someone in a California startup who is developing a sales tool. This person worked for many years in a very large enterprise that builds CRM software. His new business is very interesting because he's trying to do what you described. He's trying to do it almost being a search engine for the entire business Internet. I know this has to be verified, but their claim is that they are much more efficient than regular salespeople.

Say you're trying to sell your software product into a telco. You'll spend a lot of time learning about the person who purchases, those services. You'll go to conferences, read blogs, develop networks, and put a lot of effort into this process.

His startup suggests that they'll be able to not only identify the companies that you're able to sell into, but they'll be able to identify the actual individuals. It will become a lot more detailed in terms of this is what they're interested in and this is what they're not interested in. This is the conference that they've been to. Increasingly, we'll have more-and-more intelligence on people, their habits, their preferences, their interests, and their connections.

Creative business

Take your Netflix example. Netflix moves simply from being a content delivery service to being a creative business by looking at this kind of Venn diagram of its users interests. They saw that there was a sweet spot that overlapped with Kevin Spacey, David Fincher, and the original House of Cards from the UK. They saw that there’s this huge amount of people who love those three things. They said, "Great. Let's commission this series."

Every time that users interact with the service, it's helping to improve it. Netflix knows what you watch, when you watch it, where you stop, where you don’t finish, where you fast-forward, and where you rewind. So, they're collecting huge amounts of data that can be used not just to understand consumer behavior, but also to get insights that can be used for decisions around content.

Gardner: So, Alex, translate this to the business environment, the business network that your company is aligned with can be the determiner of how effective this new trend towards customization, anticipation and being more of a science than an art for sales for example that Greg mentioned is. This to me says the right network with the right information is a crucial decision for you. How does that work in terms of companies differentiating themselves based on who they work with in their ecosystem?

What we see a lot is that businesses are connecting to networks to conduct global business, to find new market opportunities, and become much better at actually mining and understanding that data to become more pointed in terms of what solutions they actually want to provide to the market.

Atzberger: First of all, any company that engages in a network and then captures the data to make better business decisions is already on that journey. If you look at the social networks today, if you like three things on Facebook, Facebook knows more about you than your best friend. If you like more than 10 things, Facebook knows more about you than your spouse. That’s the logic, and the same happens in business networks as well.

What we see a lot is that businesses are connecting to networks to conduct global business, to find new market opportunities, and become much better at actually mining and understanding that data to become more pointed in terms of what solutions they actually want to provide to the market.

But we're still at the very beginning of this trend. We're working with companies on enabling Data as a Service, where they leverage the data itself to create more insight into their business, pursue better business opportunities, change their product offering actually and innovate with their supplier base. If we do that, we're impacting real change, and that's absolutely feasible today, but we're still early on.

Gardner: Any examples, Alex, of companies that really get this and that are showing some demonstrable benefits, that are really tagging on innovation to what their businesses were traditionally, but taking it in a new direction based on some of these technological benefits that we’ve talked about -- poster children for innovation perhaps.

Atzberger: When I think about poster children for innovation, I think about companies that are really looking to the network as infrastructure. What are the other things I can do through this network in order to change my business or add new capabilities?

What I love is when we have customers who talk about the fact that they can actually change their industry. Or their entire supply chain. We have a one high-tech manufacturer who thinks about how they can get demand signals much faster to their supplier base so they can actually impact the end customer. I like that thinking a lot.

Gardner: Greg, last thoughts on what's to come, how technology and business combine to transform how we get things done and perhaps even improve our quality of life?

Solving big problems

Williams: That’s obviously the fundamental end result, one hopes, of all technological change -- that people have better lives and we solve big problems. Looking forward, we're going to see, as Alex has been describing, a real joining of the dots. There aren’t necessarily going to be things that are dramatic, but we're going to see increasing amounts of AI, for instance, offering us insights in industries such as healthcare that only machines are capable of determining because of the sheer volume of data that they can analyze.

I was talking to a guy who worked in the security industry recently. They do a lot of work for the Pentagon. He was telling me that they did an analysis of tweets about ISIL during one week in August last year and they noticed that most of them were about security or the security situation in various parts of Northern Iraq and Syria, account promotion, religion, and strategic updates, but then they came across an outlier that they never noticed before.

That’s obviously the fundamental end result, one hopes, of all technological change -- that people have better lives and we solve big problems.

The official ISIS accounts were re-tweeting any mention of female fighters or women in ISIL -- there was clearly a big push by ISIL to recruit women. What happens? Six weeks later, we had the first female suicide bomber in Europe in Paris. Now, those things probably are not linked, but I think we're able to see things in the data now that we have never been able to see before and I think they increasingly will be putting those things to use.

Gardner: I’m afraid we’ll have to leave it there. You’ve been listening to a BriefingsDirect thought leadership podcast discussion on how major new trends and technology are translating into disruption, and for the innovative business -- opportunity. And we’ve heard how technology innovations translate into business impacts, and how consumers and suppliers of services and goods can best prepare.

So please join me in thanking our guests, Greg Williams, Deputy Editor, WIRED UK in London, and Alex Atzberger, President of SAP Ariba.

And a big thank you too to our audience for joining this SAP Ariba-sponsored business innovation thought leadership discussion.

I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator. Thanks again for listening, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.

Transcript of a discussion on how major new trends and technology are translating into disruption, and for the innovative business -- opportunity. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

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How HPE’s Internal DevOps Paved the Way for Speed in Global Software Delivery

Transcript of a BriefingsDirect discussion on how HPE finds the sweet spot for continuous development and delivery of software products.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the HPE Discover Podcast Series. I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on IT innovation and how it’s making an impact on people’s lives.

Gardner

Our next DevOps case study explores how HPE’s internal engineering and IT organizations, through research and development, are exploiting the values and benefits of DevOps methods and practices.

To help us better understand the way that DevOps can aid in the task of product and technology development, please join me in welcoming our guest, James Chen, Vice President of Product Development and Engineering at HPE. Welcome, James.

James Chen: Thank you, thank you for having me.

Gardner: First tell us a little bit about the scale of the organization. Clearly HPE is a technology company, has a very large internal IT organization, perhaps one of the largest among the global 2000.

DevOps: Solutions That Accelerate Business Innovation
And Meet Market Demands
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Chen: We have a pretty sizeable IT organization, as you can imagine. We support all the HPE products and solutions serving our customers. We have about 8,000 to 9,000 employees, and we have a pretty large landscape of applications, something like 2,500 enterprise-scale large applications.

Chen

We also have a six data centers that host all the applications. So it's a pretty complicated infrastructure. DevOps means a lot to us because of the speed and agility that our customers are looking for, and that’s where we embarked on our journey to DevOps.

Gardner: Tell us about that journey. How long has it been? How did you get started? Maybe you can offer how you define DevOps, because it is a little bit of loose topic in how people understand it and define it.

Chen: We've been on the DevOps journey for the last couple of years. A certain part of the organization, the developer team, already practiced somehow, somewhere, in different aspects of DevOps. Someone was driving the complete automation of testing. Someone was doing a kind of Continuous Integration and Continuous Delivery (CICD), but it never came down to the scale that we believed would start impacting the overall enterprise application landscape.

Some months ago IT embarked on what we called a pilot program for DevOps. We wanted to be the ones doing DevOps in HPE, and the only way you can benefit from DevOps and understand DevOps -- the implications of DevOps on the IT organization -- is just go out and do it. So we picked some of the very complicated applications, believing that if we could do the pilot well, we would learn a lot as an organization, and it would be helpful to the future of the IT organization and deliver value to the business.

We also believed that our learning ad experiences could help HPE’s customers to be successful. We believe that every single IT shop is thinking about how they can go to DevOps and how they can increase speed and agility. But they all have to start somewhere. So our journey would be a good story to share with our peers.

Inception point

Gardner: Given that HPE has so many different products, hardware and software, what is that you did to find that right inception point. You have a very large inventory of potential places and ways that you could start your DevOps journey. What turned out to be a good place to start that then allowed you expand successfully?

Chen: We believed the easiest way was to start with some of the home-grown applications. We chose home-grown applications because it’s a little bit easier, simply because you don’t have the scale of vendor/ISP dependence to work with.

We decided to pick a handful of applications. Most of them are very complicated and some of them are very important. A good example is the OneNote application. This is the support automation application, which touches every device, every part that we ship to our customers. That application is essentially the collection point for performance data for all the devices in the customer data center, how we monitor them, and how we deal with them.

It’s what I consider a very important enterprise scale application and it’s mission critical. That was one of the criteria, pick an application that is really complicated and most likely home-grown. The other criteria was to pick an application that the application team itself already practiced, were ready to do something, and really wanted to embrace that new methodology and new idea.

The reason behind that is that we didn't want to set up a separate team to do DevOps to pair with the existing the developer team. Ideally, we wanted the existing developer team to go into that transformation. They became the transformation driver to take the old way to do DevOps into the new DevOps. So that was second criteria, the team, the people themselves had to be motivated and get ready for a change.

The third one was the application scale and impact. We understood the risk and we understood the implications. The better understanding you have, it's easy to get buy-in from your business partners and your executive team. That’s what we chose as the criteria as far as going into DevOps.

Gardner: I'm really curious. Given this super important application for HPE, how is performance measured and managed across all of these deployments, applying DevOps methodology, and getting that team buy-in? What did it earn you? What’s the payoff? What did you see that made DevOps worthwhile?

DevOps: Solutions That Accelerate Business Innovation
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Chen: With DevOps we captured three dimensions. One is collaboration. What I mean by collaboration is taking operations into development and taking development into operations, so the operations and development teams are working side-by-side. That’s the new relationship of the collaboration.

The traditional way you did this was by the developer finishing the product and then throwing it over the wall to the operations guy. Then, when something goes wrong, we start freaking out, asking who owned the issue.

The new way is a very close collaboration between the development team and operations. From the get-go, when we start to design a product or software application, we already have people who are running the operation. They run the support in the team by understanding the risk and the implications for the operation. So that’s one dimension, the collaboration.

The second piece is about automation. You want to figure out a way that you can automate end-to-end. That’s very important. You asked a very good question about how to get buy-in from your business partners who ask, "I'm going to do CICD. What is the implication if something goes wrong?"

Powerful weapon

Automation has become a very powerful weapon, because when you can automate development, the deployment process becomes much easier to roll back when something goes wrong. Because that’s a small incremental change that you're making every time, the impact is much easier to understand. We believe the down time is much less than the normal way of doing the process. That’s the second dimension, automation.

The third one is codification. Codification is that everything is code. The old way was to define your infrastructure and have someone manually put all the infrastructure together to run an application. Those times are over.

Full DevOps is that you are able to drive a code that’s easy to configure, have your infrastructure provisioned based on that code, and get ready to run an application.

So DevOps consists of those three things. It’s truly important, the way we talk about it and the way we understand DevOps: collaboration, the codification, and automation.

Having said that, there are other implications about the organization and contingency. Those have a very profound impact on our IT organization. That’s where we understand DevOps and we're using that kind of methodology. Our thinking is to take it to the stakeholder and the customer, and show them the benefit that we're able to deliver for them. That’s the reason we get the buy-in support from the get-go.

Of course the quality, high availability, and agility have significantly improved. But I would really focus on speed.

Gardner: Is speed the number one reason to do this, or is it quality or security? What is the biggest reward when you do this well?

Chen: Speed is probably the number one reason to go to DevOps. Of course the quality, high availability, and agility have significantly improved. But I would really focus on speed, because if you ask any business owner, business partner, or your customer today, the number one challenge for them is speed.

Early in our conversation, I mentioned about automation. Traditionally we do a release every six months, because it's so complicated, as you can imagine. We have products from storage, network, server – hardware and software. If we make platform changes, in order to cover all those customers, devices, and products, it required pretty much six months to do.

Since you have the six month cycle, products issued to your customer before the next release will not have the best support on the host automation capability.

The performance of our service quality has a significant impact on customer satisfaction. Now we're talking about a release every two weeks. That’s a significant improvement, and you can see customers are happy because now with every product release, they have the automation capability within two weeks. You immediately have the best monitor and proactive care capability that we provide to our customers.

Bottom line

Gardner: I should think that that also has an impact on the bottom line, because you're able to bring new features and functions to the market, add more value to the products, and then charge more money for it. So, it allows you to get the value of your organization in to your bottom line although faster as well.

Chen: Yes. For example, we want to deliver any product or service that has a call-home capability, do the support automation, and proactively take care of them, within two weeks.  It's a huge advantage for us, because the competition typically take a few days to a couple of weeks just to install everything.

That two weeks is probably the best timing optimized for this kind of service scheme. Can we push this to one week or a few days? It's possible, but the return on investment may not be on day one.

For every application, when you make the call about DevOps, it’s not about wanting to do it as fast as possible. You want to examine your business case and determine, “what’s the sweet spot for us with DevOps?” In this particular case, we believe that looking at the customer feedback and business partners' feedback, two weeks is the right spot for us. That's significantly better than what we use to have, every six months.

DevOps: Solutions That Accelerate Business Innovation
And Meet Market Demands
Learn More Here

Gardner: I'm afraid we will have to leave it there. We've been learning how HPE’s internal engineering organization explores the values and benefits of DevOps methods and practices. I'd like to thank our guest, James Chen, Vice President of Product Development and Engineering at HPE. Thank you, James.

Chen: Thank you so much for having me.

Gardner: And I'd also like to extend a big thank you to our audience for joining this special DevOps innovation case study discussion. I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of HPE-sponsored discussions. Thanks again for listening, and come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a BriefingsDirect discussion on how HPE finds the sweet spot for continuous development and delivery of software products. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

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IoT Plus Big Data Analytics Translate into Better Services Management at Auckland Transport

Transcript of a discussion on the impact and experience of using Internet of Things technologies together with big data analysis in a regional public enterprise.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the HPE Discover business transformation series. I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on IT innovation and how it’s making an impact on people’s lives.

Gardner

Our next top innovator case study discussion explores the impact and experience of using Internet of Things (IoT) technologies together with big data analysis to better control and manage a burgeoning transportation agency in New Zealand.

To hear more about how fast big data supports rapidly-evolving demand for different types of sensor outputs -- and massive information inputs -- please join me in welcoming our guest, Roger Jones, CTO for Auckland Transport in Auckland, New Zealand. Welcome, Roger.

Roger Jones: Thank you.

Gardner: Tell us about your organization, its scope, its size and what you're doing for the people in Auckland.

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Jones: Auckland Transport was formed five years ago -- we just celebrated our fifth birthday -- from an amalgamation of six regional councils. All the transport functions were merged along with the city functions, to form a super-city concept, of which transport was pulled out and set up as a council-controlled organization.

But it's a semi-government organization as well. So we get funded by the government and the ratepayer and then we get our income as well.

We have multiple stakeholders. We're run by a board, an independent board, as a commercial company.

We look after everything to do with transport in the city: All the roads, everything on the roads, light poles, rubbish bins, the maintenance of the roads and the footpaths and the grass bins, boarding lights, and public transport. We run and operate the ferries, buses and trains, and we also promote and manage cycling across the city, walking activities, commercial vehicle planning, how they operate across the ports and carry their cargoes, and also carpooling schemes.

Gardner: Well, that's a very large, broad set of services and activities. Of course a lot of people in IT are worried about keeping the trains running on time as an analogy, but you're literally doing that.

Real-time systems

Jones: Yeah. We have got a lot of real-time systems, and trains. We've just brought in a whole new electric train fleet. So all of the technology that goes with that has to be worked through. That's the real-time systems on the platforms, right through to how we put Wi-Fi on to those trains and get data off those trains.

Jones

So all of those trains have closed-circuit television (CCTV) cameras on them for safety. It's how you get all that information off and analyze it. There's about a terabyte of data that comes off all of those trains every month. It's a lot of data to go through and work out what you need to keep and what you don’t.

Gardner: Of course, you can't manage and organize things unless you can measure and keep track of them. In addition to that terabyte you talked about from the trains, what's the size of the data -- and not just data as we understand it, unstructured data, but content -- that you're dealing with across all these other activities?

Jones: Our traditional data warehouse is about three terabytes, in round numbers, and on the CCTV we take about eight petabytes of data a week, and that's what we're analyzing. That's from about 1,800 cameras that are out on the streets. They're in a variety of places, mostly on intersections, and they're doing a number of functions.

They're counting vehicles. Under the new role, what we want to do is count pedestrians and cyclists and have the cyclists activate the traffic lights. From a cycle-safety perspective, the new carbon fiber bikes don’t activate the magnetic loops in the roads. That's a bone of contention -- they can’t get the lights to change. We'll change all that using CCTV analytics and promote that.

But we'll also be able to count vehicles that turn right and where they go in the city through number plate recognition. By storing that, when a vehicle comes into the city, we would be able to see if they traveled through the city and their average length of stay.

What we're currently working on is putting in a new parking system, where we'll collect all the data about the occupancy of parking spaces and be able to work out, in real time, the probability of getting a car parked in a certain street, at a certain time. Then, we'll be able to make that available to the customer, and especially the tradesman, who need to be able to park to do their business.

Gardner: Very interesting. We've heard a lot about smart cities and bringing intelligence to bear on some of these problems and issues. It sounds like you're really doing that. In order for you to fulfill that mission, what was lacking in your IT infrastructure? What did you need to change, either in architecture or an ability to scale or adapt to these different types of inputs?

Merged councils

Jones: The key driver was, having merged five councils. We had five different CCTV systems, for instance, watched by people manually. If you think about 1,800 cameras being monitored by maybe three staff at a time, it’s very obvious that they can’t see actually what’s happening in real time, and most of the public safety events were being missed. The cameras were being used for reactive investigation rather than active management of a problem at this point in time.

That drove us into what do we were doing around CCTV, the analytics, and how we automate that and make it easy for operators to be presented with, in real-time, here is the situation you need to manage now, and be able to be proactive, and that was the key driver.

There’s a mix of technologies out there, lots and lots of technologies. One of the considerations was which partner we should go with.

When we looked at that and at all the other scenes that are around the city we asked how we put that all together, process it in real time, and be able to make it available again, both to ourselves, to the police, to the emergency services, and to other third-party application developers who can board their own applications using that data. It’s no value if it’s historic.

Gardner: So, a proverbial Tower of Babel. How did you solve this problem in order to bring those analytics to the people who can then make good use of it and in a time frame where it can be actionable?

Jones: We did a scan, as most IT shops would do, around what could and couldn’t be done. There’s a mix of technologies out there, lots and lots of technologies. One of the considerations was which partner we should go with. Which one was going to give us longevity of product and association, because you could buy a product today, and in the changing world of IT, it’s out of business, being bought out, or it’s changed in three years time. We needed a brand that was going to be in there for the long haul.

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Part of that was the brand, and there are multiple big brands out there. Did they have the breadth of the toolsets that we were looking for, both from a hardware perspective, managing the hardware, and the application perspective? That’s where we selected Hewlett Packard Enterprise (HPE), taking all of those factors into account.

Gardner: Tell us a bit about what you're doing with data. On the front end, you're using a high-speed approach, perhaps in a warehouse, you're using something that will scale and allow for analytics to take place more quickly. Tell us about the tiering and the network and what you've been able to do with that?

Jones: What we've done is taken a tiered approach. For instance, the analytics on the CCTV comes in and gets processed by the HPE IDOL engine. That strips most of it out. We integrate that into an incident management system, which is also running on the IDOL engine.

Then, we take the statistics and the pieces that we want to keep and we're storing that in HPE Vertica. The parking system will go into HPE Vertica because it’s near real-time processing of significant volumes.

The traditional data warehouse, which was a SQL data warehouse, it’s still very valid today, and it will be valid tomorrow. That’s where we're putting in a lot of the corporate information and tying a lot of the statistical information together so that we have all the historic information around real time, which was always in an old data warehouse.

Combining information

We tie that together with our financials. A lot of smaller changing datasets are held in that data warehouse. Then, we combine that information with the stuff in Vertica and the Microsoft Analytics Platform System (APS) appliances to get us an integrated reporting at the front end in real time.

We're making a lot of that information available through an API manager, so that whatever we do internally is just a service that we can pick up and reuse or make available to whoever we want to make it available to. It’s not all public, but some of it is to our partners and our stakeholders. It’s a platform that can manage that.

Gardner: You mentioned that APS appliance, a Microsoft and HPE collaboration. That’s to help you with that real-time streaming, high velocity, high volume data, and then you have your warehouse. Where are these being run? Do you have a private cloud? Do you have managed hosting, public cloud? Where are the workloads actually being supported?

Jones: The key workloads around the CCTV, the IDOL engine, and Vertica are all are running on HPE kit on our premises, but managed by HPE-Critical Watch. That’s an HPE, almost an end-to-end service, but it just happens to be on our facilities. The rest is again on our facilities.

So we have a huge performance increase. That means that by the time the operators come in, they have yesterday’s information and they can make the right business decisions.

The problem in New Zealand is that there aren't many private clouds that can be used by government agencies. We can’t offshore it because of latency issues and the cost of shipping data to and from the cloud from the ISPs, who know how to charge on international bandwidth.

Gardner: Now that you've put your large set of services together, what are some of the paybacks that you've been able to get? How do you get a return on investment (ROI), which must be pretty sizable to get this infrastructure in place? What are you able to bring back to the public service benefits by having this intelligence, by being able to react in real time?

Jones: There are two bits to this. The traditional data warehouse was bottle-necked. If you take, from an internal business perspective, the processing out of our integrated feed system, which was a batch-driven system, the processing window each night is around 4.5 hours. To process the batch file was just over that.

We were actually running into not getting the batch file processed until about 6 a.m. At that time, the service operators, the bus operators, the ferry operators have already started work for the day. So they weren’t getting yesterday’s information in time to analyze what to do today.

Using the Microsoft APS appliance we've cut that down, and that process now takes about two hours, end-to-end. So we have a huge performance increase. That means that by the time the operators come in, they have yesterday’s information and they can make the right business decisions.

Customer experience

On the public front, I'd put it back to the customer experience. If you go into a car park and have an incident with somebody in the car park, your expectation is that somebody would be monitoring that and somebody will come to your help. Under the old system that was not the case. It would be pure coincidence if that happened.

Under the new scenario, from a public perception, that will be alerted, something will happen, and someone will come to you. So the public safety is a huge step increased. That has no financial ROI directly for us. It has across the medical spectrum and the broader community spectrum, but for us as a transport agency, it has no true ROI, except for customer expectations and perceptions.

Gardner: Well, as taxpayers having expectations met, it's probably a very strong attribute for you. When we look at your architecture, it strikes me that this is probably something more people will be looking to do, because of this IoT trend, where more sensors are picking up more data. It’s data that’s coming in, maybe in the form of a video feed across many different domains or modes. It needs to be dealt with rapidly. What do you see from your experience that might benefit others as they consider how to deal with this IoT architectural challenge?

When you start streaming data in real-time at those volumes, it impacts your data networks. Suddenly your data networks become swamped, or potentially swamped, with large volumes of data.

Jones: We had some key learning from this. That’s a very good point. IoT is all about connecting in devices. When we went from the old CCTV systems to a new one, we didn’t actually understand that some of that data was being aggregated and lost forever at the front end, and what was being received at the back end was only a snippet.

When you start streaming data in real-time at those volumes, it impacts your data networks. Suddenly your data networks become swamped, or potentially swamped, with large volumes of data.

That then drove us to thinking about how to put that through a firewall, and the reality is you can’t. The firewalls aren’t built to handle that. We're running F5’s and we looked at that and they would not have run the volume of CCTV through that.

So then you start driving to other things about how you secure your data, how you secure the endpoints, and tools like looking down your networks so that you understand what’s connected or what’s changed at the connection end, what’s changing in the traffic patterns on your network, become essential to an organization like us, because there is no way we can secure all the endpoints.

Now, a set of traffic lights has a full data connection at the end. If someone opens a cabinet and plugs in a PC, how do you know that they have done that, and that’s what we have got to protect against. The only way to do that is to know that something abnormal is there. It’s not the normal traffic coming from that area of the network, and then we're flagging it and blocking it off. That’s where we are hitting because that’s the only way we can see the IoT working from a security perspective.

Gardner: Now Roger, when you put this amount of data to work, when you've solved some of those networking issues and you have this growing database and historical record of what takes place, that can also be very valuable. Do you expect that you'll be analyzing this data over historical time periods, looking for trends and applying that to feedback loops where you can refine and find productivity benefits? How does this grow over time in value for you as a public-service organization?

Integrated system

Jones: The first real payback for us has been the integrated ticketing system. We run a tag on-tag off electronic system. For the first time, we understand where people are traveling to and from, the times of day they're traveling, and to a certain extent, the demographics of those travelers. We know if they're a child, a pensioner, a student, or just a normal adult type user.

For the first time, we're actually understanding, not only just where people get on, but where they get off and the time. We can now start to tailor our messaging, especially for transport. For instance, if we have a special event, a rugby game or a pop concert, which may only be of interest to a certain segment of the population, we know where to put our advertising or our messaging about the transport options for that. We can now tailor that to the stops where people are there at the right time of day.

We could never do that before, but from a planning perspective, we now have a view of who travels across town, who travels in and out of the city, how often, how many times a day.

We could never do that before, but from a planning perspective, we now have a view of who travels across town, who travels in and out of the city, how often, how many times a day. We've never ever had that. The planners have never had that. When we get the parking information coming in about the parking occupancy, that’s a new set of data that we have never had.

This is very much about the planners having reliable information. And if we go through the license plate reading, we'll be able to see where trucks come into the city and where they go through.

One of our big issues at the moment is that we have got a link route that goes into the port for the trucks. It's a motorway. How many of the trucks use that versus how many trucks take the shortcut straight through the middle of the city? We don’t know that, and we can do ad-hoc surveys, but we'll hit that in real time constantly, forever, and the planners can then use that when they are planning the heavy transport options.

Gardner: I’m afraid we will have to leave it there. We have been learning about how big data, modern networks, and a tiered architectural approach has helped a transportation agency in New Zealand improve its public safety, its reaction to traffic and other congestion issues, and also set in place a historic record to help it improve its overall transportation capabilities.

So I'd like to thank our guest, Roger Jones, CTO for Auckland Transport in Auckland, New Zealand. Thank you, Roger.

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Jones: Thanks very much.

Gardner: And thank you, too, to our audience for joining us for this Hewlett Packard Enterprise transformation and innovation interview. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of HPE-sponsored discussions. Thanks again for listening, and come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a discussion on the impact and experience of using Internet of Things technologies together with big data analysis in a regional public enterprise. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

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Building a Modern Marketing Organization in a Multi-Channel World

Transcript of a discussion on how social media and business networks have taken the lead in shaping perceptions about brands, products, and companies.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.

Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you’re listening to BriefingsDirect.

Gardner

Our next innovation thought leadership discussion focuses on building a modern marketing organization. Marketing today is a different game. Today’s buyers are more connected and informed than ever, and that’s creating major upheaval in the way companies promote their brands.

Social media and business networks have taken the lead in shaping perceptions about brands, products, and companies -- and savvy businesses are embracing these new channels and technologies both to increase their brand awareness and to drive sales.

We’re here with two experts to talk about these changes and how they are shaping the future of marketing. To learn more, please join me in welcoming Alicia Tillman, Chief Marketing Officer at SAP Ariba. Welcome, Alicia.

Alicia Tillman: Thank you so much, Dana, very happy to be here.

Gardner: We are also here with Pete Krainik, Founder and CEO of The CMO Club. Welcome, Pete.

Pete Krainik: Thanks, Dana and Alicia, good to reconnect again.

Tillman: Yes, of course, you, too.

Gardner: Let’s begin our conversation at a fairly high level. What are the trends, the competitive pressures, and the technology changes that are prompting companies to have to seek new and better ways to market themselves, Alicia?

Tillman: There are two things, Dana. First, when we think about trends or even new ways to market in particular, we're faced with the fact that social media, and networks have taken the lead in shaping perceptions about brands, products, and companies.

Tillman

On one hand, there’s no shortage of information, and that’s a good thing. But on the other hand, it’s really causing companies to get out ahead of that as quickly as possible, because the reality is that today’s buyers aren't struggling to find information. And so many buying decisions are made about companies and products before any interaction with a member of the sales team.

Companies are recognizing that all of the channels in the social media space that companies are going after to find information is key. Making sure that marketers are driving information in a consistent manner across these channels will aid in feeling as though your company’s value proposition and brand are being embraced and accepted in the ways that you want them to.

My second point is in terms of the competitive pressure. All companies are mostly trying to compete on a product, a piece of technology, in a lot of ways, and oftentimes your competitors are saying they already have or are about to innovate on the same thing. So companies need to force themselves to innovate beyond products. There are a lot of opportunities, in particular, thinking about how you differentiate on things such as thought leadership or standing for a particular cause.

How do you take a product and how do you use it to benefit the world in terms of driving higher good in some way? So between social media and networks, embracing those channels and then separately thinking about how you differentiate beyond just the basics of products are certainly the opportunities that companies are faced with today.

Social media

Gardner: Pete, with social media, we're more exposed than ever. People can point at whatever they see about brands or companies. How is this trend shaping the new marketing and competition?

Krainik: I think Alicia is spot-on. I host dinners with chief marketing officers (CMOs), and I'm chatting behind doors on these issues around the new competitive landscape. If you look at the pressures faced by CMOs, you still have the same process or the same thought -- I need to sell more products, I need to differentiate myself, I need to get leads, I need to close, I need to build the brand. Those things and concepts haven’t changed, but you have a whole new wave of extremely agile competitors now, like Uber, like Airbnb.

Krainik

How is the cloud impacting that? You have the new players that you never had to deal with before. You have new media channels, new influencers. In the past, media mostly meant working on press releases. But the whole world has changed. You talked about it, and Alicia again talked about social.

And then, this whole issue of speed of change and how to keep up with it is interesting. How do I, as an organization, keep up with all the changes?

Marketing is completely different than it was five or 10 years ago. There are just too many choices, too much noise, too much outbound. CMOs are getting hundreds of emails a day from someone selling some product and they're not even looking at it. Those kinds of pressures are building, as Alicia said, and taking the competition to the next level. Those things are top of mind right now for CMOs.

Gardner: Alicia, in this environment of disruption, of fast-paced change, of so much noise and information, you recently completed a significant update of the Ariba brand, and you’ve launched a new name and logo. Why did you do that at this time and how did you go about that differently than you would have done 5 or 10 years ago?

Tillman: Ariba was founded some 18 years ago, and at the time, the company had set out on a mission to build a single solution to help companies manage their spend. If we reflect on the past 18 years, you see all the ways in which our business has evolved, in which buyer needs and the economies have evolved, and how our business has worked to evolve and be ahead of that. Today, Ariba is the world’s largest marketplace for all business-to-business (B2B) transactions.

We have two million companies and $1 trillion in commerce that run through the Ariba Network. When we think about some of the significant change that has happened notably in the past four years, number one, we were acquired by SAP. SAP is a global leader in enterprise application software. It has an incredible brand, and is an incredibly sound and operationally and financially stable company known throughout the world. It’s really important to us to take that brand reputation into our identities.

First, we've added the SAP name to our brands, now calling ourselves SAP Ariba. And secondly, the logo, the mark, or the bug as some people like to call it, that fits alongside the company name is equally important. The visual representation of our brand needs to well support the business we're in and the value proposition we offer.

Pete said it really well. When we think about the marketplace that we're in today, there are new competitors, new influencers, and so many choices that we have an obligation as marketers to help buyers clear through the clutter, understand where the differentiation exists within companies, and associate themselves with a company that is most relevant to their needs.

Showcasing customers

So, we evolved our logo and made it into a mark that really showcases our customers, which are both buyers and sellers. Within our logo there's a connection there that’s reflected to support how Ariba brings those two buying populations together.

In addition to that, we've worked to adapt a new tone in our messaging. Messaging got simple and clear to piece point about all the choices that exist. You’ve got to focus on a simple and clear message, and one that is very understood and very relevant for your customers.

Gardner: Pete touched on this issue of so much information available, and research confirms that consumers are looking at multiple channels when they make a purchase. They have much more of an ability to do research and to get social commentary. I myself find, in my own buying, that I'm ready to push the button to buy something, but then I'll glance at the comments or some of the recommendations, and actually back away. So this is really a big deal.

So how do we, as marketers, think about different ways to accommodate these new behaviors by buyers, and how do we then provide information to them as sellers to help them along the way?

Krainik: One thing some of the top CMOs or top brands are doing is moving away from a campaign-focus to 360-degree coverage. I was a CMO before I started The CMO Club, and the profession has moved beyond kind of the "blah, blah, blah" to true focus. There’s the ability to make sure that the content is relevant, that the stories are there, that you’ve identified the advocates, and people underestimate the value of that.

Everybody is driven by mobile now. It's truly a mobile workforce. We're always doing everything on mobile.

You talked a minute ago about how you check on social media or with people you know or respect, and they say, "This product is good, this product isn’t, or I had a great experience here." How do you spend the time making sure you know who those advocates are, who the influencers are, how to engage employees, and really focusing on getting to that. It’s such an important thing that I think people don’t think about as much.

Another piece that there’s not enough focus on: Everybody is driven by mobile now. It's truly a mobile workforce. We're always doing everything on mobile. So making sure when we talk about multichannel and we talk about going where the customers are, we need to be sure it’s in the format they want as well. We want them saying that we have this great website, this great digital space. If you’re not going to mobile, then you’re missing the boat.

Gardner: Alicia, anything to offer on ways marketers need to do things differently to accommodate these new buyer behaviors?

Tillman: I think a lot about the power of consistency and how marketers need to have their finger on the pulse of the channels that their customers are getting information from. Pete’s organization, The CMO Club, hosted a fantastic CMO roundtable a couple of weeks ago where the topic was how to stay ahead of the digital transformation, and how marketers are embracing digital transformation.

One of the questions was how much of our budget is dedicated to a digital platform to support our marketing? Certainly, the percentages were quite high, but we also found that there is still budget being invested in your more traditional channels, including things like print and events. Events in particular, because of the face-to-face communication that occurs and how business is still done over a handshake, and we can’t underestimate that.

Strong balance

Striking a strong balance between your digital marketing channels as well as your traditional marketing channels is key. Keeping the message consistent in how we market between those channels is also quite key, and then understanding the various buyer personas that you speak with. If you’re creating a digital campaign for the CIO audience, the messages are going to be different from how you would market to a chief financial officer (CFO) audience.

As an example, and it’s really important, back to an earlier point I made around relevancy, you’ve got to stay consistent, but you also have to make sure you’re being relevant, and then taking into account a strong balance between the new digital channels that exists, but also not underestimating the power that still remains with some of our more traditional channels.

Krainik: Alicia, I think you're spot-on. I loved the comment about staying true and consistency, and you’ve demonstrated that with what you’ve done. I know you talked about what we actually see in the market. It’s the importance of creating the brand story and being consistent to that story.

It’s more important now than ever, because then you can get your employees, your advocates, and all your stakeholders supporting that brand story, regardless of the channel. Brand consistency is more important now than the actual advertising campaigns. You’ve done a great job and I think you're spot-on with that. It makes the multichannel execution easier, if you’ve got that nailed, as opposed to chasing it campaign to campaign.

Brand consistency is more important now than the actual advertising campaigns.

Tillman: Yeah, absolutely.

Gardner: Well, Alicia, at this point, where we have these challenges, we're also facing some great new tools in the marketplace, ways to get more information, get customization, use big data, and leverage cloud models to extend our reach, but also to gather more information in better ways. Tell me what you think some of the strong tools are, and I am going to imagine that the SAP Hybris marketing suite is among them.

Tillman: I'd start by ensuring that you have a strong marketing automation platform. It's becoming commonplace in most marketing organizations, large or small, for the past five years or so and it’s certainly growing in size in terms of marketing organizations that are raising the technology.

Essentially, this technology allows you to automate the lead generation process to help you manage campaigns in an automated way, help you nurture the leads that are coming through your demand waterfall in an automated way. The leads that you’re handing off to sales are more qualified than they ever had been before.

You have such an extreme ability to nurture these leads using digital campaigns in these automated ways. That’s my first recommendation: you need to pursue marketing automation technology.

The other thing that exists within these technologies is not just an ability to help you manage your campaigns and manage the nurture strategies within them, but it’s also the data that these technologies provide.

As you integrate them with your company's sales customer-relationship-management (CRM) system, it gives you really unprecedented abilities to show where the demand is being created, and how you can most effectively demonstrate the support of marketing to the ultimate growth of the pipeline, and then of course, to the growth of the business.

Focus on measurement

So it is a must-have that you focus on that in particular. That’s the leading place that I would start. Then, there's all of that getting into the analytics. Every marketer should always be focused on measurement. Measurement is the sole thing that has enabled me to grow my team, whether that be headcount or investment.

When you're not sitting across the table from your CEO or my president talking in terms of numbers and data that are showing the true impact as marketing’s existence on the companies thought of mind, you’re essentially not having a conversation, and you will not have an ability to grow your team. So I highly advise that you look at strong marketing automation and data and analytical structure to enable you to help support your programs.

Gardner: What’s super powerful these days about the data is that we're not only gaining a 360-degree view of customers, but we're able to react in near real time, and then target them with precise customization. How are those tools being used, from your vantage point, that sort of feedback loop and an instant ability to know what a customer is doing, learn inference, compare that to other datasets and then offer something back to them, which really should engage them?

Data is what needs to be at the backbone of your operations within the marketing organization, because it really informs everything.

Tillman: Obviously, being part of SAP, I could spend all day talking about the advanced analytical tools that exist, and having the sort of in-memory computing technologies like S/4HANA, which is the backbone of SAP. These tools have the power to look at large datasets quickly. There are many cloud sales applications that work to provide customer information that marketers need in a central location, it’s available at a glance, and it’s delivered in context that’s truly most important for marketers.

There’s so much flexibility in the cloud. Companies can pull together information in real time or live, as we like to say here at SAP, pulling from so many sources. Data is what needs to be at the backbone of your operations within the marketing organization, because it really informs everything from where you can innovate and where campaigns are having the most success, to what that next big thing is going to be to help propel the company forward. And that’s a big part of what’s the core of a marketing organization.

Gardner: Pete, any additional thoughts about what you’re hearing from your CMO audience about use of these data tools?

Krainik: I’ve seen a shift among CMOs in the last year to two years on how they approach data tools. They used to approach it by looking at the tools currently available and choosing one that catches their eye. Now, there are a number of really bright CMOs out there who are actually taking the approach of assuming that they have total visibility, total velocity, and can get total value at their fingertips from a design perspective, whether it’s for demand and lead generation or a campaign. So they start with that assumption, then they design what that ideal tool would be. And then they evaluate the tools’ capabilities and processes.

By the way, what’s equally is important, I found out talking to CMOs is that you can have the great tools, but if you don’t have the right team and expertise to run it, post implementation, it can cause a problem. That’s an interesting approach. If you could have any piece of information what would like to begin with, what would you like to have to know about your customers? It just opens up some interesting ideas to really stretch the envelope versus force fitting, and I am sure, Alicia, you are seeing that too with some of your customers.

Tillman: Absolutely.

Gardner: Alicia, looking to the future, what do you see as some of the greatest challenges that marketers are facing? I'm thinking the perhaps the user experience is going to become more important over time, but how do you see that?

New opportunities

Tillman: There are a couple of things. The war to differentiate and to bring new opportunities, new leads, into the business is always going to be a reality for marketers. They're always going to need to have a very clear brand, a very simple message, and one that’s differentiated and relevant.

So focusing on your brand story and ensuring that that brand story is consistent across all of the buying and marketing channels, and is relevant and is compelling is always going to be a reality for marketers, because your brand drives the growth of your business’s bottom line. It’s what fuels your pipeline; it’s what fuels the sale of your product; it's what enables you to tell your story around differentiation. So, there always needs to be a clear focus there.

The other thing too, and I had mentioned this in one of my opening comments, is around this notion of differentiation and thinking beyond products in ways in which you can differentiate yourself. As an example, I work in a B2B space, but think about some of the best consumer brands in the world, and those that we support in our personal lives.

Often, I like to reflect on the brands that I support in my personal life, and when I think about what the similarities are between those brands and why I am so loyal to them, not only are their products best in class, but they’ve actually put their products to use beyond what the day-to-day objective is.

If you think of a brand like Tom’s or Starbucks, they have filled brand promises around where they source their materials, where they donate portions of their revenue. And when we think about the millennial population as one, but any buyer, there is a much greater desire for them to partner with organizations that stand for something versus ones that don’t. B2B organizations, in particular, have a tremendous opportunity to think beyond the level in which they’re competing with day after day, and think about what is that higher good.

It’s really how we're taking our value proposition and using it to create higher good in the world around things that people care about and really mater at the end of the day. That’s the real opportunity for marketers.

When we talk about visions, vision statements should be operational, and it’s really how we're taking our value proposition and using it to create higher good in the world around things that people care about and really mater at the end of the day. That’s the real opportunity for marketers.

Gardner: Pete, what advice would you offer the CMOs as they think to overcome these challenges in order to reach this vision of a brand-driven and customer-centric world?

Krainik: The two most important things are, first, that I would put my energies around making sure that I have a marketing organization that has the new marketing skills and new technical skills needed for success. Number one, get the best and the brightest.

The other thing, in addition to the differentiation that was discussed, is this whole issue of ecosystem of innovation: creating an ecosystem, understanding how I am going to look to the outside to bring in new ideas, new startup capabilities, new energy. Those are the two essentials for success. If you don’t do those, I think people are going to be in trouble long term.

Gardner: I'm afraid we will have to leave it there. You’ve been listening to a BriefingsDirect podcast discussion focused on how to build a modern marketing organization. We’ve heard how social media and business networks have taken the lead in shaping perceptions about brands, products, and companies. And we have learned how savvy companies are embracing these new channels and technologies to increase their brand awareness and drive sales.

So, please join me now in thanking our guests, Alicia Tillman, Chief Marketing Officer at SAP Ariba, and Pete Krainik, Founder and CEO of The CMO Club.

And a big thank you too to our audience as well for joining this SAP Ariba-sponsored business innovation and thought leadership discussion. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator. Thanks again for listening, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba

Transcript of a discussion on how social media and business networks have taken the lead in shaping perceptions about brands, products, and companies. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

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