Leadership Insights: Driving Real Digital Transformation

Transcript

Mike Vizard: Hello, and welcome to the latest edition of the Digital CxO Leadership Insights series. I’m your host, Mike Vizard. Today I’m with Bill Burns, who’s the CEO for Zebra Technologies, and we’re talking about, well, how does digital business transformation get real? Bill, welcome to show.

Bill Burns: Great to be here. Thanks for having me.

Mike Vizard: We hear a lot of people talking about the theory all the time, but you guys are kinda in the middle of this conversation with customers in terms of what they’re practically doing. So, maybe start out with exactly who is Zebra? And what are you seeing your customers do to actually execute their digital business transformation visions?

Bill Burns: Yeah, we think of Zebra as really empowering organizations to thrive in what we call, kind of an on demand economy, right? And we do that through this idea of the need for goods and services in real time and the expectations of customers, so that is how we view the on demand economy. And then how do businesses, you know, e-commerce suppliers, retailers, transportation, logistics manufacturers, all respond to that need? We think of our vision as enterprise asset intelligence, and the idea that every frontline worker and asset is actually being digitized – has a digital voice. And it’s visible and connected in, ultimately, optimally, utilized inside the front edge of business. So, think of it as scanners at the checkout in a retail store. Think of it as mobile devices, in the hands of an e-commerce, picking situation or delivery. Think of it as a printer, for a hospital wristband that ultimately improves patient outcomes. So the digital voice that we could give a package inside e-commerce – a piece of inventory, leaving a retail store, a patient or the medicine, getting to that right individual to improve outcomes is how we think of digitizing the environment and, ultimately, the workflows associated with that. And then we think of, overall, in our business, this concept of sense, analyze, act, right? If you can digitize an environment, give it a digital voice, you can sense what’s happening at this point of productivity and business, whatever that is. Retail, transportation, logistics, manufacturing, health care, public safety – if you can really be able to sense what’s happening, then you can analyze that in real time, you can take action that drives outcomes within someone’s business, or better patient outcomes and health care, that allows you to leverage digitization and automation of workflows to make you more effective, more efficient and have better outcomes for your business. Or in things like public safety or health care, better outcomes overall.

Mike Vizard: Is there too much focus on the back end? It seems like everybody wants to go hire developers to go build some fancy new service in the back end. But there’s not a lot of ways to consume it. Because every time I go out these days, I go to a store, and I still see the same old point of sale systems. I still see delivery guys walking around with big clunky mobile devices. So what does it take to kind of push the ball forward?

Bill Burns: Yeah, it’s really – the fact of the matter is that those point of sale terminals are still necessary; that the device is in the hands of the associate – the question is about the software that you put on those devices to make that retail associate, ultimately, more effective and more efficient. How do you get them more information in real time? So instead of collecting data, big data – think big data analytics. How do I take data that I need in real time to tell the forklift in a distribution center where the next place to pick up freight is? How do I tell the store associate that there’s a new task for them in a store while they’re replacing inventory on a shelf? To go deliver that order that somebody’s ordered online and needs to pick up in store? How do I communicate from a manager inside a retail store? In a large retail environment? How do I communicate to you know, Mike, and tell them, “Hey, look, I need to talk to you about, you know, we got a new truck coming in an hour or so and the delivery time has changed.” I needed to go take care of that delivery, while I have somebody else do the job you’re doing, so how do I communicate and collaborate between management and others in a store? So, you know, we think of it as leveraging technology in point of sale – things like RFID technology to be able to tell that actually that item was sold so somebody returns it if they stole it; and return it. Now I know that item didn’t go through my point of sale. So it’s adding intelligence to the point of sale terminals you’re seeing, or those mobile devices, through software that allows workers to be more efficient. The fact that they can reduce loss and loss prevention, all that’s what really matters – how they have better customer service and support. When somebody buys online, picks up in store and has a better experience picking it up at a store.

Mike Vizard: Do you think real time is becoming the new competitive bar that everybody has to hit? Because it seems like customers will start voting with their feet, if they go to a store and somebody tells them, “What you need is in the other store halfway across town.” They drive over there, and it’s not there. And we all heard those experiences. So is this becoming the new bar that you need to meet just to stay relevant?

Bill Burns: Yeah, I mean, we call it omni channel, right? The idea that consumers want to purchase, however they want to purchase, they want to buy from a mobile device that has a mobile device friendly website, and they want to be able to buy online at home at their convenience. They want to go into the retail short store and shop, because they still very much enjoy that experience as well. When they buy it online, they want the option to have it delivered to their house. And as you said near real time, the next day, sometimes in a couple of hours, maybe two days at most. They also want the option to go pick it up in-store, and as you said, and they want to make sure that it’s actually in store – if they actually order online and go pick it up. Because if they don’t, they likely won’t go through that process again, or move, as you said, to buy from somebody else. The way you solve those challenges is really a combination of why it is giving people this omni channel experience, but also making sure your inventories are right in each one of the right areas. Meaning that you know exactly what your inventory is inside your warehouse. You know what in store inventory looks like. And the way you do that is a combination of things like barcode scanning, but you also do it through RFID technology and retailers today. So I can read inventory in real time, I can use electronic tags to tag merchandise, and then I know whether it’s there or not. I’m actually sending electronic signals to that tag; that tag is blinking back to me. It’s saying, “Hey, that blue blouse in size large is actually on the retail floor.” And I can see it here. And I know it’s in inventory. So having the correct amount of inventory, knowing where it is, is a key to that delivery process. Ultimately, I think consumers want to buy however they want to buy. But ultimately, they want the fulfillment of that to be accurate and truly either delivered on time, or picked up and to actually have it in the store. And the way you saw that is more supply chain visibility or inventory visibility in a distribution center, in a fulfillment center or in a store.

Mike Vizard: Is there a disconnect between the business folks and the IT folks about this? Because I think all the business folks nod their head and say, “Yep, that’s what we want.” But I don’t think they really understand how difficult it is to make some of these legacy systems that are proverbial elephants that need to dance, actually implement something that is consumable in real time. So do we need to have a bigger conversation?

Bill Burns: Yeah, I think that we’re seeing, over the last several years, our buying personas within our customers, and let’s stick with retail for a minute, you know, truly change, right? In the past, IT organizations that ultimately wanted a hardware and software to go through them in services – now we’re seeing that customer really be a grouping of professionals within the store. So loss prevention, store operations, HR, all play a role along with it, kind of a, you know, a three or four in the box scenario that are making decisions around technology that’s going into store. And I think we’re seeing store operations, we’re seeing HR with workforce management, we’re seeing store operations play an important role partnered with it, to really understand what’s necessary. And many times, as you said, that means upgrading legacy applications to go onto modern devices, which with Android type solutions, on the OS – enabled right – I think it is leveraging legacy point of sale and turning that into more more flexible arrangements where a mobile device can be used as a point of sale, or I can use credit cards in a store from Zebra to be able to take payment from a customer. So we’re seeing it really partnered with the different personas in the store, and then all having a seat at the table at the same time which we hadn’t seen in the past.

Mike Vizard: Do you think that we need to re engineer those processes? Often, it seems to me that I look at people when they buy some new gear and when I look closer, they’re kind of digitizing the existing paper based process that was there before and they really haven’t thought out through the whole – how do we make this a better experience for the customer part of the equation? So are we at the beginning of this journey, rather than closer to the end?

Bill Burns: Yeah, I think that what you’re talking about is really what we talked about is changing workflows, right? Ultimately, you’ve got to change the way you’re gonna be open to change, and change the workflows to ultimately, by leveraging this, you know, digitizing and automating the environment, as we talked about, if you never automate the workflows, if you never change, as you said, the process of using paper, then you’re losing the efficiency that you could really gain through this idea of sensing something with a digital voice, analyzing what’s happening in real time, acting upon it and driving the outcome. If you’re not willing to change the workflows, if you’re not willing to listen to what the data tells you, beyond your manual processes you have in place today, then you’re never going to get the efficiencies, you’re never going to get the customer success or service, you know, experience the best part of the outcomes.

Mike Vizard: Do we spend enough time getting employees to buy in on this, because we all had that experience somewhere where you went in, and the employee is fumbling with something that they say is a new system they just got and they don’t know how it works.

Bill Burns: You had change managers – that important piece of this, right? We go through this a lot because some of the retail software we use today around task management, around collaboration, around workforce management is tied right to the associate, even the devices they use, inside an e-commerce warehouse are used inside retail. You know, the idea of bringing those devices into service securely, easily putting them in the hands of a worker and have them quickly pick up on the tasks at hand and what they need to use the device for. And the applications on it is mission critical, because ultimately, there’s a lot of turnover in that staff. So change management, as well as just training and introducing new technology. Things like mobile devices – everyone’s using a mobile device today. So, you know, our Android operating system in a rugged device with a scan engineer, and it looks a lot like people are using smartphones today, only, it gives you a better experience inside an enterprise environment. Because it’s a custom built keyboard, and it’s set up for parameters to work within that store with specific Wi Fi capabilities and others. So it’s an enterprise built device. But that training and change management is absolutely important. Otherwise, retailers won’t be successful with e-commerce warehouses. They’ve got to be able to bring workers up to speed very, very quickly. All different applications, health care as well. Using those mobile devices and all being intuitive applications are critical to the success of technology.

Mike Vizard: I agree. What have you seen among your customers that have been successful? Are there any common patterns, trends, things that they do that others should copy? That you go – Yeah, that’s how we get there.

Bill Burns: Yeah, I think that, again, this idea of partnering across the enterprise – I think all the stakeholders, we see our customers literally take mobile devices and applications and put them in the hands of associates and make them part of the decision making process, right? Because then they bought into the new device, the new form factor, the new software that’s going to be used, and then ultimately give feedback during the buying decision or buying process. Thinking about technology early and often, ultimately, you know, faster processing speeds, more memory upgrades, and WiFi – those are the things that frustrate employees if they’re used to faster, WiFi speeds at home that they can get in a retail store. They can get better connectivity on their mobile device than they can on an enterprise device – then they’re frustrated. So I think that the second piece is really involving the workers into the decision making. Second is keeping ahead of technology, and making sure that ultimately, devices are working as best as possible, along with the software optimized for those devices – for the user experience within the worker environment. I think lastly, just the idea that, you know, everyone kind of buying into the technology and ultimately making sure that, as you said before, the change management and the training is done for employees to make sure that they really understand the reasons behind each one of the applications, and ultimately the use of the device also helps in technology adoption and, ultimately, within the enterprise environment.

Mike Vizard: These days, you cannot walk down the street without somebody leaping out to tell you about their great new AI. I think technology is moving faster than we can absorb at this point.

Bill Burns: Yeah, I think there’s a lot of practical applications; we kind of started this call of talking about digitizing environments, the same thing with AI. So, you know, machine learning is an important aspect of many of the technologies Zebra’s deploying today. So, you know, robotics, autonomous robots within a warehouse for goods transport or, e-commerce uses machine learning to learn the environment. They’re in our machine vision products; you know, knowing what a golden image looks like in a good, better, best scenario, in one that’s failed inside a machine vision. So looking at vision systems, and ultimately deciding if something’s good or bad, and training that algorithm – our AI engine within our planning software, within retail allows you to take in things like, you know, weather and social media feeds and outside influences into the planning decisions that ultimately buyers are making within retail. So I think there’s plenty of practical applications. Everyone wants to point to AI. But I think that underlying AI technology is the learning engine that ultimately feeds the artificial intelligence and the decision making around it. I think things like vision, and things like vision systems, especially from Zebra, really play an important role inside that learning.

Mike Vizard: So what’s your best advice to folks as we kind of look at this landscape? I mean, should they have a point of experimentation everywhere? Should there be a center of excellence for driving things? What are you thinking about here?

Bill Burns: Yeah, I think, you know, inside our organization, we think about how do we leverage machine learning, vision systems, AI, across the organization and leverage the best of that across the entire organization – across all development areas. I think you’ve got to let individual applications kind of begin to flourish or nurture first, and then, ultimately come back to what’s the AI engine. I’m going to use what’s the best machine learning algorithms to be able to use to teach the model and then become more centralized, but I think you got to see kind of experimentation and needs within each of the different applications of AI, and machine learning before you can kind of bring it together. I think if you ultimately play kind of Big Brother and say everything’s going to be done centrally, without having some experimentation or a need, where people come together and say, “Hey, yes, I am using machine learning. I am using AI techniques within my business and, ultimately, my application. I’d like to pull it together corporately, and we’re all working on the same thing and getting the benefits of it.” But I think unless you go through that, and you just say initially – I am going to form this AI group within the organization, and let it be handed out to each one of the business units and say – figure out how to use it. – That doesn’t work either.

Mike Vizard: All right, folks. Well, it’s pretty clear that customers are forming opinions of organizations based on how technologically savvy they are. So you might want to start thinking about exactly what you’re doing versus talking about doing. Hey, Bill, thanks for being on the show.

Bill Burns: Yeah. Thanks, Mike.

Mike Vizard: All right. And thank you all for watching the latest edition of the DigitalCxO Leadership insights series. You can find this on the digitalcxo.com website, along with our others. And once again, thanks for watching.