Digital Transformation Guide

SPECIAL REPORT
DIGITAL TRANSFORMATION:
A CXOS GUIDE
COPYRIGHT 2017 CBS INTERACTIVE INC. ALL RIGHTS RESERVED.

DIGITAL TRANSFORMATION: A CXOS GUIDE
TABLE OF CONTENTS
03 Digital transformation: Retooling business for a new age
10 Digital transformation is a work in progress for most companies
11 Digital transformation: Making it work in the real world
15 How to use digital transformation to win budget
17 Want to create digital transformation? Make a solid plan first
21 8 obstacles to overcome in your digital transformation journey
25 Five winning plays for digital transformation
29 Study Group moving from manual DR to an always-on education
provider
32 How digital is aiding Lovespaces ambitions to transform its

self-storage
35 Improving productivity with smart office tech at VMware and Box

40 How Campbell Soup is betting on digital transformation, ecommerce,
science to grow sales
42 Wendys cooks up digital transformation plans with kiosks, mobile

apps, customer experience lab
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DIGITAL TRANSFORMATION: RETOOLING

BUSINESS FOR A NEW AGE
BY CHARLES MCLELLAN employees and more effectively compete in an
Digital transformation is a buzzword that has ever-changing digital economy (Altimeter).
been tripping off the tongues of vendors, analysts
[Digital transformation is] the result of IT
and industry observers with increasing frequency
innovation that is aligned with and driven by a
in recent years. In a sense, digital transformation
well-planned business strategy, with the goal of
of business has been ongoing for decades,
transforming how organizations serve customers,
starting with the mainframe and minicomputer
employees and partners; support continuous
and progressing through the PC/client-server,
improvement in business operations; disrupt
internet/web and mobile/cloud eras. But arguably,
existing businesses and markets; and invent new
its set to make the biggest impact yet in the next
businesses and business models (451 Research).
few years, in the brave new world of ambient/
AI-driven computing. The goal of digital transformation isnt better
social or faster analytics... its to remake brands to
DEFINING DIGITAL be more adaptable, better at learning and above all,
able to tie together the strands of product, sales
TRANSFORMATION marketing and service that make up the customer
But what exactly is digital transformation? Here
experience (Adobe).
are a few definitions and descriptions from various
quarters: A pretty broad remit, then, and one that
stretches well beyond the purview of just the
Organizations must begin to look at digital
CIO. For example, in many organisations digital
holistically and transform by applying digital
transformation is moving inwards from the
thinking across everything they dohow they
customer-facing edge, via a revamping of the
win, serve, and retain customers; how they operate
customer experience or CX. Thats why the
internal processes; and how they source business
CMO is regularly mentioned in digital transfor-
services. In short, they must become a digital
mation dispatches. But analysts and surveys also
business (Forrester).
note that more digitally advanced organisations
[Digital transformation is] the realignment of or tend to have a holistic strategy, driven from the
investment in new technology, business models, top down by the CEO with buy-in from the entire
and processes to drive value for customers and C-suite.
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Its important to bear in mind whats at stake here: a recent survey of over 500
C-suite executives across Europe and the US (from ChristianSteven Software,
conducted by GITNS) found that two-thirds (65%) believe that 40 percent of
Fortune 500 companies will not exist in 10 years time. Over half (53%) of those
surveyed said they were concerned about competition from disruptive businesses,
although almost all (91%) were hopeful about the future of technology in their
organisations.
How these incumbent enterprises manage the introduction of new technology

in the coming years will play an important part in determining which ones
survive in the face of competition from a new generation of highly focused, agile
startupswhich, of course, dont have the requirement to maintain and upgrade
legacy systems. As Tim Yeaton, senior vice-president of Red Hats infrastructure
business, told ZDNets sister site Tech Pro Research last October: In five to ten
years, I think its about how much can be abstracted, how much can be automated,
how much can be driven through machine-to-machine and artificial intelligence,
with developers adding value to whats come before. Thats where youre going
to see the pace accelerate. In this new world, the CIO will become much more
of a curator and enabler of IT initiatives and developmentsa broker of the
resources, as Yeaton put it.
Lets take a look at some recent studies on digital transformation.
WHAT THE SURVEYS SAY

A March 2016 report, Leading Digital Business Transformation,
commissioned by SugarCRM and Squiz from analyst firm Forrester,
canvassed 410 senior executives from enterprises in Australia, China,
France, Germany, India, Singapore, the UK and the US. Sectors
represented in the survey were financial services and insurance,
government, higher education, media and publishing and retail.
Here are the key findings from Forresters study.
Mature digital businesses are rare (just 11% of companies surveyed).

The CEO drives the digital vision and strategy in these organisations
(41% of CEOs set the digital strategy, while 59% understand and Image: forrester
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support it). Customer experience is the North Star for digital transformation initiatives (the top three drivers
for mature businesses are improving customer experience, increasing the speed of innovation and improving
time-to-market). Cultural and organisational issues are key challenges even for mature firms (43% of mature
digital businesses see competing departments wanting to own digital as the most significant barrier to effective
transformation). Digital is a journey that requires businesses to be agile (94% of mature businesses plan to
address the threat of digital disruption by making systems and processes more agile).
A key detail from Forresters report is the clear emphasis placed by mature digital businesses on analytics to
improve customer experience:
Image: Forrester
September 2016 saw the release of Altimeters The 2016 State of Digital Transformation report (the analyst firms
second on the subject), based on a survey of 528 qualified digital transformation strategists and executives
leading change within their companies. Respondents came from companies in a variety of industriesall with
more than 250 employeesin the US, Canada, the UK, France and Germany.
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Here are some of Altimeters key findings.
Customer experience was the top driver of digital transformation (although

IT and marketing still influenced technology investments), with 55 percent of
those responsible for digital transformation citing evolving
customer behaviors and preferences as their primary catalyst.
However, only half (54%) of survey respondents had completely
mapped out the customer journey within the last year or were
in the process of doing so. The top three digital transformation
initiatives at organisations were: accelerating innovation (81%);
modernising IT infrastructure (80%); and improving opera-
tional agility (79%). Digital transformation is largely led by the
CMO (34%), but only 29 percent of companies had a multi-year
roadmap to guide digital transformation evolution. Image: Altimeter
As noted above, Altimeters survey found customer behaviour to be the

main driver of digital transformation. This was followed by the need to expand
into new markets, to respond to competitive pressure and to accommodate new
regulatory and compliance standards:
image: altimeter
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Analyst firm 451 Researchs most recent spotlight on digital transformation on echoes the Forrester and
Altimeter studies in emphasising that this process is still in its early stages. Less than a quarter (22%) of organi-
zations that participated in an April 2016 survey said they had a well-defined formal digital transformation
strategy, while 36 percent were either considering or planning a strategy and 29 percent had no strategy at all:
image: 451 research
According to the analyst firm, the main drivers of digital transformation are: intelligence (generating insight
from data and moving to data-driven decision making); agility (essential because digital disruption is coming
to your business); and customer-centricity (the age of personalised marketing is upon us, so rather than
individuals being grouped into vague demographics, it is now possible to know precisely when you are walking
down the aisle of a specific supermarket, or have entered the lobby of a specific hotel).
When it comes to the aspects of an organisation that are transformed digitally, 451 Research identifies three
main areas: information usage, business processes and technology platforms.
Transformation of information usage is all about two-way engagement with customers over multiple
communication channels, and extracting insight from the resulting data via advanced analytics and machine
learning. Business process transformation requires cultural and technological shiftsfor example in the
adoption of modern collaboration tools such as Slack, or agile DevOps methods in the IT department.
Technology platform transformation, meanwhile, concerns the shift from siloed on-premise systems
of record to flexible API- and microservices-driven systems of engagement running in hybrid cloud
environments.
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The most recent study is Adobes 2017 Digital Trends report. Based on
an extensive global survey of 14,163 digital marketing and ecommerce
professionals across EMEA, North American and Asia Pacific markets
conducted in November/December 2016, the Adobe/Ecoconsultancy study
offers the following key insights.
Just over a fifth (22%) of respondents rank optimising customer experience

as the single most exciting opportunity for 2017. These respondents also
look beyond mobile to focus on the IoT, augmented reality (AR) and virtual
reality (VR). However, the role of data fell down marketings priority list in
2017 compared to 2016 -- perhaps because these investments have already
been made.
image: adobe
The vast majority (86%) of survey respondents agree that design-driven
companies outperform other businesses, while 82 percent believe that
creativity is highly valued within their organisations and 77 percent are investing in design to differentiate their
brand. That said, 44 percent believe they lack the processes and collaborative workflows to achieve a design
advantage.
The survey reveals an apparent split between between companies that find it easy to build a collaborative,
customer-centric culture and those that dont. The implication is that the former are smaller, more agile
startup-type companies while the latter are
more traditional enterprises.
Personalisation, and channels that lend

themselves to personalisation, are a
driving force behind marketing success,
the Adobe survey finds, while marketers
in APAC are more likely to prioritise
engagement via mobile apps and social
media.
Looking further ahead, the most exciting

prospects for digital marketers seem to
be VR and AR, IoT devices and AI/bots
image: adobe
(particularly in Europe).
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OUTLOOK
Digital transformation is about reshaping organisations culture, business processes and IT operations around
new technologysocial, mobile, analytics (including AI and ML) and cloud, plus VR/AR and IoTin order to
better engage with their customers and streamline their internal processes.
Surveys suggest that most organisations are still in the early stages of this transformation. Many are starting
with the customer experience, while smaller, more agile companies may be finding the process easier than large
enterprises with legacy baggage.
Data is a key raw material for the digitally transformed business, and data science will turn this raw material into
realisable value. But raw materials and value-added assets can be stolen, held to ransom or otherwise misused,
so next-generation businesses will need to guard their data carefully. Regulations concerning customer privacy
and data governance generally will also need to keep up with the rapidly changing times.
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DIGITAL TRANSFORMATION IS A WORK

IN PROGRESS FOR MOST COMPANIES
BY AMY TALBOTT
When ZDNets sister site Tech Pro
Research surveyed IT leaders about the
state of digital transformation in their
companies, only 20% said they have a
strategy firmly in place. Mary Shacklett,
author of the research report on the
survey, said, although computerized
digitalization first began to form into an
earnest strategy in the 1940s, the idea of
systematically transforming a company
and its business operations into a digital
organization is still an emerging concept
at most companies.
As outlined in this infographic, almost

all respondents said their companies
had taken steps toward a digital trans-
formation, despite not having an
overarching strategy in place. The most
popular efforts undertaken so far have
been eliminating paperwork in favor
of digital tools, adopting social media
for purposes like sales and recruiting,
and implementing online training for
employees.
For more findings, including which Erik underwood/techrepublic
transformation technologies provided

the greatestand the leastreturn on
investment, how much companies are spending on digital transformation, and what companies want from
vendors, download the full report. (A Tech Pro Research subscription is required.)
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DIGITAL TRANSFORMATION: MAKING IT

WORK IN THE REAL WORLD
BY MARK SAMUELS
Digital transformation is the process through which companies can take a
new look at their existing processes and remake them with the help of new
technologies and new ways of thinking.
The aim might be to cut costs, understand customers better, or create new revenue
streams. Its a relatively simple concept but hard to put into practice; here we look
at some of the issues involved in such a project.
MARKETING: HOW TO CREATE A DIGITAL-

FIRST ATTITUDE
Customer experienceCXis the big priority for marketing professionals
through 2017, says Jim Clark, research director at Econsultancy. He draws on
evidence from the research firms recently released Digital Trends 2017 report,
which surveyed 14,000 marketing professionals globally. Almost a quarter (22
percent) of marketeers say CX is their key concern this year.
Clark, however, issues a word of warning and suggests great experiences are by
no means a given: executives must focus on techniques that help their business
exploit data in an integrated manner. CX is in itself important, but marketing
professionals must think now about how they implement experience as a strategy,
said Clark, speaking at Adobes recent Digital Trends Forum in London.
The good news is that almost half (46 percent) of firms believe that digital now
permeates their marketing efforts. Clark says easy access to the cloud and software-
as-a-service is helping marketeers to harness digital technology quickly in their
attempts to change business processes and customer experiences for the better.
There is interest in technology to spread insights, too. Almost half (49 percent)
of marketing professionals intend to increase their investment in analytics this
year. However, the research suggests that digital transformation is a far from
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straightforward process. Just 14 percent of to fully understand the key trends to engage with
marketing chiefs described their business as a customers personally. As new technologies like VR
digital-first organisation in 2015; today, that figure roll out, that focus on personalisation becomes
is even lower at 11 percent. even more critical.
The reality of the situation is that implementing All firms, he says, must look to continually surprise
digital transformation is tough, says Clark. Some and delight their customers. It can be difficult to
boards might not be as fully behind change as engender digital-led change, particularly in a sector
others. Having the right skills in place is key to like finance, says Clark. One way is to start small
engendering full cultural change, both in terms on key projects, and to hope these examples pick
of understanding the customer and linking those up traction and that the benefits permeate across
trends back to the business. the rest of the organisation.
Clarke points to best practice examples in strategy.

He says smart companies are findings ways to BUILDING A DIGITAL
converge sales and marketing teams, ensuring FOUNDATION IN
customer data is pooled across the business, rather FINANCIAL SERVICES
than being held in isolated and unconnected stove Chris Worle, digital strategy director at Hargreaves
pipes. Lansdown, is one executive driving transformation
Leadership matters, too. More than three quarters in a finance firm. Worle manages digital-led change
(77 per cent) of blue-chip firms now have a chief at the FTSE 100 business, which manages 70
customer officer or equivalent, billion of assets on behalf of its 876,000 clients.
according to analyst Gartner.
These c-suite executives are
focused on building and
pushing the focus on customer
experience across the business
various operational activities.
Data-driven marketing
technology is now a lot more
accessible but there needs
to be an awareness in terms
of engaging audiences, says
Clark. Your business needs Image: ZDNet
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Worle and his team run a website that receives more than
100 million visits a year.
Your business will be
judged against the digital
Were seeing huge growth in mobile, both in terms of the
use of our apps and direct visits to the website, he says. experiences that people
The number of trades via mobile is up 200 percent year get everywhere else, be
on year. This has consequences in terms of the experiences
that from technology
we provide, because we pride ourselves on a high quality of
service. companies like Google or
Worle recognises the number of channels to market has
via online retailers.
grown rapidly since the firm started its transformation Chris Worle
journey in 2008, as has the number of products offered
to clients. The digital team started sifting through huge volumes of data to keep a
tight grip on customer experiences, but found itself swamped with information.
We took a breath and decided to start small instead, he says, looking back
on the digital change process. We then took a strategic approach to testing
and optimisation. Rather than focusing on the entire website, we focused on
quick wins connected to high-volume web pages. We used that insight to drive
improvements.
Worle and his team honed website content and launched the firms first app in
2011. Yet transformation in the mobile age remains a work in progress. We find
ourselves today in a constant cycle of measure, understand and improve, he says.
The modern digital challenges facing Hargreaves can be summed up by three key
terms, says Worle: complexity, speed, and expectations. Theres a requirement
to create a consistent experience across multiple channels and thats incredibly
difficult, he says, referring to the issue of complexity. Were actively working on
cracking that approach.
When it comes to speed, Worle says his organisation feels the pressure to innovate
and deliver solutions increasingly quickly. Technology is moving faster than ever
before, he says. People will drop off, and you will lose their business, if they have
to wait even just a few seconds for a web page to load.
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The final challenge is around expectations and the ever-demanding nature of modern customers. Your
business will be judged against the digital experiences that people get everywhere else, be that from technology
companies like Google or via online retailers, says Worle. Customers dont care that youre a regulated finance
firmthey just expect the same high quality of service, regardless of sector.
The good news is Worle continues to deliver great customer experiences. The key lesson for other CXOs is to
recognise the importance of mobility. Most of our clients use mobile as their main communication channel of
choice, he says. The business needs to focus on the fact that mobile is more than just another channeland
thats a constant battle.
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HOW TO USE DIGITAL

TRANSFORMATION TO WIN BUDGET
BY PATRICK GRAY
Added to a growing list of executive concerns, one of the more recent and interesting questions is Could
we be Uber-ed? referring to the ride sharing company that has forever changed the taxicab and broader
transportation industry. Technology has long had the ability to drastically change industries and business
models, but now technology is combining with innovation, business strategy, and unprecedented speed
to create whats been termed digital transformation. While this change isnt exactly new to IT leaders, the
breathtaking speed with which industry upsets are occurring has drawn attention to the opportunities and
threats that digital presents to incumbent businesses.
ASSESS THE LANDSCAPE The challenge of IT

Your admonitions about technology-driven change may
have fallen on deaf ears in the past, but there are now
budgeting, especially for
myriad examples of disruption based on digital. Indeed, large-scale initiatives, has
industries that once seemed impenetrable to outside always been connecting
competition, due to high costs of entry or asset-heavy
operating models, are some of the most easily disrupted
the spend to the results.
through new technology. The Ubers of the world made With digital, however, this
the extensive physical assets and geographic footprint exercise becomes more
of the taxi industry an albatross around the neck rather
than a barrier to entry, and similar disruptions are
compelling.
occurring in industries from shipping to entertainment.
While one only has to look around the competitive landscape to see examples of digital disruption, spend some
time with your team or trusted advisors to determine how digital could disrupt your businessand how you
could disrupt the status quo, or even an adjacent or unrelated industry where the unique capabilities of your
company, plus some digital mojo, could change the game.
The challenge of IT budgeting, especially for large-scale initiatives, has always been connecting the spend to the
results. With digital, however, this exercise becomes more compelling. Rather than painful machinations about
TCO or ROI, a new platform might allow you to deliver a game-changing new service. Or investing in internal
innovation could leverage your existing data and processes to outmaneuver a threatening startup.
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Seek input and buy-in from your peers once your budget for the capability of location-based
you have your initial digital story developed, offers versus a line for beacon technology.
as this will ultimately be the foundation of These gaps are the areas where additional spend is
your digital transformation budget. Time required, and as each directly relates to a needed
invested in circulating and refining this story capability that is linked to a digital transformation
will pay dividends later, as each element of your initiative, it will ultimately link to the business
transformation budget will link back to enabling disruption it is meant to mitigate or create. Instead
your digital story. of financial gymnastics, your transformation
budget is two degrees away from the strategic
BUDGET FOR impact it is meant to create. Now, your budgetary
CAPABILITIES, NOT debates center on which transformational
SYSTEMS objective to pursue. If your peers hesitate to fund
a key capability, it should be abundantly clear
When you have a view of the landscape and the
which transformational objectives become more
opportunities and threats presented by digital,
difficult or impossible to achieve.
narrow the focus to a collection of initiatives that
your company can embark on in order to thrive While IT budgeting is often marketed by painful
in the changing market. Avoid confining your debates about whether a theoretical productivity
thinking to what you can do with the current benefit will result in 2% or 2.25% savings, digital
systems and organizational constraints during the transformation presents a unique opportunity to
initial phases of this exercise. link digital capabilities directly to transformational
Once you have drafted an initial portfolio of initiatives. This ultimately elevates the budgetary
digital transformation initiatives, assess what process to discussions about which strategies
capabilities youll need against what you have your business wants to pursue, versus debates
and identify the gaps. This should be familiar about how youve calculated TCO and estimated
to anyone whos done a classic fit/gap various efficiencies. With proper preparation and
analysis; however, the focus is squarely on digital a compelling, shared vision of the future, you
capabilities versus technology and systems. For may find your budgetary discussions become
example, if one of your transformational efforts more about how quickly you can execute given
requires communicating with customers at any significant resources, as opposed to where you can
time, on any device, you might put an item in squeeze more blood from a stone.
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WANT TO CREATE DIGITAL

TRANSFORMATION? MAKE A SOLID
PLAN FIRST
BY MARY SHACKLETT
The advantage of working in IT is that you are usually well ahead of digital and
computing technology information and adoption curves. The downside of this is
that you often understand the value propositions of a new technology before your
colleagues do. The quandary for the CIO, then, is how to get buy-on from the CEO
and other key stakeholders in the organization for technologies that you regard as
essential to the business.
To consider this question at closer range, lets look at digital transformation.
TechRepublic recently conducted a poll of CIOs, and more than half said their
company doesnt have a formal digital transformation strategy. Our business
supports constantly varying needs from a shifting pool of clients, said poll
respondent David Wilson, director of IT services at VectorCSP. We embrace
opportunities for digital transformation when they present themselves, but would
not have a clear path for such a formal plan overall.
Does initial buy-in require a formal plan?
Such a fragmented approach to digital transformation seems like a recipe for disaster,
but is it?
With digital transformation, it just might be possible that the usual steps that CIOs
take, like recommending solutions and approaches for technology introduction
and adoption, constructing a rolling three year plan for implementation in specific
business areas, calculating estimated ROI (return on investment), budgeting for all of
this, and then selling it to the CEO and others, isnt neededat least not right away.
Here is what leads me to say this.
In a recent Tech Pro Research survey on digital transformation, 28% of respondents

said that IT was the driver of this initiative; 26% said it was the CEO, CMO, CFO or
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another non-IT, C-level executive; 22% said that a VP, a business leader, or an IT
director was leading the digital transformation; and another 24% of respondents
said that it was someone else.
This suggests that corporate adoption of digital technologies, unlike the adoption
of many other previous technologies, is a distributed and democratic process in
companies that no one person seems to own when it is first introduced to the
organization.
For CIOs, who usually have to do the heavy lifting At the end of the day, end
when it comes to selling and funding new technology,
this is welcome news because it gets digital trans-
users (and management, too)
formation in the door, and with many different end recognize that IT has be part of
user areas doing the selling and the adoption, the the mixif for no other reason
likelihood of finding an appropriate business case
that can pay back on the technology investment also
than to consolidate all of these
theoretically increases. independent efforts.
But stop right there--because initial buy-in does not
necessarily translate into continuous buy-in and support, especially if projects
dont go as planned and value isnt delivered as expected.
WORKING IN A DECENTRALIZED
TECHNOLOGY ADOPTION ENVIRONMENT
WITHOUT A PLAN
The dangers of independent digital transformation adoption efforts by end users
is that 1) end users usually dont know the IT that will be needed to integrate their
system into the other company systems; 2) users might inadvertently negotiate a
contract with a vendor the locks them into a solution that doesnt work well in the
long run; and 3) users might think the payoff from their digital effort is bigger
than it really is.
Industry research backs this up.
In 2015, Forrester Consulting reported from its survey work that over 60% of
digital experience projects were failing. The top three reasons for failure were: 1)
CMOs believing `that existing legacy technology in their companies could power
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the digital technologies they wanted to introduce; information into a compiling budgetary proposal
2) lack of a full understanding of how end for the CEO or the CFO.
customers of the technology would use it; and 3)
lack of technological (specifically digital) maturity. MAKING THE MOVE INTO A
Also that year, Genpact, a business processing
FORMAL PLAN
and IT services company, published a survey
Since it seems that many organizations have
of managers working at 100 large global enter-
taken an early approach into digital transfor-
prises, with managers reporting that only 30% of
mation by pursuing it piecemeal, with a majority
their digital projects were delivering a return on
of CIOs saying that they lack a formal plan,
investment that met business expectations.
the key going forward may well be developing a
At the end of the day, end users (and management, vision and a formal plan for company-wide digital
too) recognize that IT has be part of the mix--if transformation.
for no other reason than to consolidate all of these
This overall plan should first and foremost
independent efforts.
address the value that the business expects to
In the same Tech Pro Research survey gain from digitalizationwhether it is eliminating
where respondents reported that their digital paper, improving access and expediting business
transformation efforts were highly distributed and processes; using GPS and satellite imagery
decentralized, 42% of respondents came back to and combining this with contextual data so a
say that they believed that ultimately, IT would be construction company can obtain a more complete
the owner of all of these digital transformation view of a building site; cracking genomic codes
initiatives. Additionally, nearly two-thirds of to provide answers in cancer research; or better
respondents in the TechRepublic survey said that understanding the buying habits of customers.
they received enthusiastic support from their
Next, a digital transformation plan should address
senior management for digital transformation
operational and system cross-functionality
initiatives, but over half said it was difficult to
throughout the enterprisebecause to get the
secure budget dollars for projects.
most out of digitalization, you have to know how
Selling the budget is also where CIOs add value. to use it fully. If sales wants data on customer
They are experienced in analyzing the inherent satisfaction, it would be advantageous for
value of a new technology, the cost of not only customer service reports to be in their system
implementing it but integrating it with existing so they can understand their clients pain points
systems and business operations, what the payoffs with their products before they call them with a
are likely to be--and then packaging all of this new pitch. And if customer service wants to be
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more proactive, it would help if it had visibility of all of the RMA (return material
authorization) documents in manufacturingand which products were most often
being returned and reworked.
These issues of business value estimation, selling the budget (and the CEO/CFO),
and understanding the requirements of the systems and operations implementation
and integration efforts are all squarely in ITs (and the CIOs) wheelhouse.
To this end, a digital transformation plan for the entire organization should be
developed, ideally by IT. The plan should illustrate how digital systems can (or will
be) linked together, what the levels of initial investment (and returns on investment)
are likely to be and when they will occur, what the order of system integration will
be, and what changes in business processes and IT infrastructure are necessary to
support digital transformation.
This plan should be the final product of continuous IT engagement with other key
managers throughout the company before the plan is shared in budgetary meetings
or presented to the CEO and the C-level for buy-in and signoff.
Does this assure that your digital transformation plan will get the buy-in?
Behavior precedes beliefthat is, most people must engage in a behavior before
they accept that it is beneficial; then they see the results, and then they believe that it
is the right thing to do... implementation precedes buy-in; it does not follow it. said
Douglas B. Reeves, founder of Creative Leadership Solutions.
Hes rightand many companies with their distributed digital transformation

projects have been doing exactly this.
But what Reeves doesnt mention is that buy-in must also be sustainable for a
company-wide technology strategy to work.
Sustainability depends on a continuous chain of project successes, and those

successes depend on effective technology investments, integration and delivery of
business value.
These are the final payoffs.
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8 OBSTACLES TO OVERCOME IN YOUR

DIGITAL TRANSFORMATION JOURNEY
BY ALISON DENISCO
Enterprises with lofty digital transformation goals must take caution: The road
will not always be smooth, largely due to human behavior, not the new technology
itself.
Were at the cusp of trying to understand what digital is

as an industry, said Khalid Kark, managing director of The best efforts around
Deloitte LLP, and director of research for Deloittes CIO
Program. Were just starting to recognize the huge amount
digital are not individual
of impact digital will have. But we are not recognizing the siloed efforts, but are multi-
enormity of the effort required to actually drive those front functional and dimensional
end changes we want.
efforts where there is a
Here are eight common challenges that arise during digital
team and accountability.
transformation projects, so you can be prepared to navigate
any bumps in the road. Khalid Kark
1. ORGANIZATIONAL CHANGE
Some 70% of change programs fail to achieve their goals, largely due to employee
resistance and lack of management support, according to McKinsey.
Digital transformation involves a significant change, and usually changes to

peoples jobs, compensation, bosses, and the type of work they do, said Marc
Cecere, vice president and principal analyst on Forresters CIO role team. Making
that kind of change is difficult, and is something where there is not a lot of
science. Make sure you have someone on board who knows how peoples minds
are changed, and how to adapt to new business models.
Organizational siloes are one of the biggest impediments to digital transformation

efforts, in terms of understanding the customer journey, said Gianni Giacomelli,
chief innovation officer at Genpact, and head of its Genpact Research Institute.
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Often either the IT group or the business lines areas like data or changing business processes, you
try to solve it, and do not work together deeply, may have some problems, but its not the worst
Giacomelli said. thing. But the feeling is if you mess up on security,
the consequences are more dire.
Digital requires multi-functional collaboration,
Kark said. The best efforts around digital are not
individual siloed efforts, but are multi-functional 3. LEGACY SYSTEMS
and dimensional efforts where there is a team and Legacy systems remain a large challenge for most
accountability, he added. enterprises, said Brian Solis, principal analyst
at Altimeter. Almost every aspect of how a
More often than not, the company does business today is built on the
premise of how businesses worked in the last
existing IT landscape doesnt
hundred years, Solis said. Any time innovation
have enough to support has forced businesses to make changes, theyve
these new models like smart invested in new tech as a means to adapt to that
tech, but based on yesterdays premises.
cities, digital healthcare, and
the industrial internet, Research firm Gartner recommends enterprises
build a digital platforma blueprint for what IT
Hung LeHong needs to build to support digital transformation.
This includes legacy systems, as well as new
2. SECURITY building blocks to support digital initiatives such
More than half (55%) of companies said that as the Internet of Things (IoT). More often than
security was the No. 1 challenge they face when not, the existing IT landscape doesnt have enough
implementing digital enablement technologies, to support these new models like smart cities,
according to a recent report from SoftServe. digital healthcare, and the industrial internet, said
Security nearly always tops the list of digital trans- Hung LeHong, vice president and Gartner fellow,
formation obstacles in Forrester research as well, and member of the CEO and Digital Business
according to Cecere. Leaders research group. It does require additional
building blocks.
Cybersecurity is complex, dynamic, and
fast-changing, Cecere said. Security issues are Most businesses will not completely get rid of
also highly visible to boards of directors and the their legacy systems, but will modernize them,
public. It makes it rougher because you have to LeHong said. They might do this with APIs
get it right, Cecere said. If you mess up on other or service-based options, he added. Its about
22
renovating the core, as opposed to getting rid of the Executives dont often live the
core, and it sets the foundation to build out a digital
platform, LeHong said. company the way employees
and customers do, so their
4. LACK OF CLARITY understanding of tech is done
The danger of the term digital transformation
is that it can potentially encompass a huge number from an arms length.
of initiatives, said Bill Briggs, CTO and managing Brian Solis
director of Deloitte Consulting.
Being able to define it in a statement that has a meaningful and measureable outcome might seem
trite, but its amazing how many projects dont have that clarity, Briggs said. The challenge becomes
taking that and winding it into some actionable, digestible initiatives.
5. THE DIGITAL ICEBERG

When considering digital transformation, each member of the C-suite is focused on some aspect of
the digital iceberg, Kark said. For example, the CMO might be focused on customer engagement,
the COO on the supply chain, the CFO on analytics, and so on. However, these issues only reach the
icebergs tip, when in reality, a lot of systems will need to be adjusted on both the back and front ends
to succeed digitally, Kark said.
The CIO is often the best positioned to address the entire digital iceberg, as they can take a more
holistic view of IT and other systems, Kark added.
6. LACK OF DIGITAL LITERACY

A lack of C-suite understanding of the importance of making digital shifts can undermine many
efforts, Solis said.
Executives dont often live the company the way employees and customers do, so their under-
standing of tech is done from an arms length, Solis said. They tend to see mobile and all of these
new technologies much in the same way they saw the web when it first came along, asking Is this
going to be a thing? Lets limit our investment. It places them in dangerous territory.
7. UNDERSTANDING CONSUMER DEMAND

When considering digital projects, enterprises need to understand what customers want, and when
theyre going to want it, LeHong said.
23
Getting the timing right is complicated, LeHong said. If you create a connected dishwasher, customers
might want it today, but probably will want it more in the future, when the connected home is more popular.
8. PARTICIPATION WITH DIGITAL GIANTS

Companies on the business to consumer side need to determine if their products and services will integrate
with the likes of Apple, Amazon, and Google, LeHong said. For example, in the connected cars space, Ford
recently announced that it would bring Amazon Alexa to new vehicles.
The concept of working with digital giants creates holy wars at the executive level, LeHong said. You can
imagine some executives thinking Theres no way were going to work with them, they are our competitors.
But some people wont buy a car if it doesnt have Apple CarPlay.
This also applies to almost any digitized product, LeHong said. For example, people may want a dishwasher
that can interface with Alexa. The incumbents in every industry are having to join forces with some of these
big platforms, or make the choice to fight against them, LeHong said.
Image: Wayne cunningham/Cnet roadshow
24
FIVE WINNING PLAYS FOR DIGITAL

TRANSFORMATION
BY ALISON DENISCO
Most organizations are in the midst of digital transformation projects that aim to keep
the company competitive in an expanding digital market. However, the definition of a
digital project varies from company to company, said Khalid Kark, managing director of
Deloitte LLP and director of research for
The most popular Deloittes CIO Program.
digital measures that It might mean enabling mobile and social
companies plan to capabilities, or getting the workforce to
implement in 2017 are collaborate more, or focusing on customer
engagement and experience, or developing
moving systems to the and driving a new revenue source. So how
cloud, shifting to online can business and tech leaders choose the
digital tools, using data projects that will yield success?
analytics, and using You have to look at your business context,

and develop an approach that would allow
social media. you to drive quick value for your business,
said Kark. It doesnt matter what it is, but there needs to be an urgency around doing
it. Go after the low hanging fruit, build and establish credibility, then go for bigger, more
innovative efforts to drive change.
Here are five digital transformation projects with high chances of success.
1. BUILD A CROSS-FUNCTIONAL DIGITAL TEAM

Digital enablement involves setting the foundation for further digital transformation, by
adding channels such as mobile, social, and cloud, said Hung LeHong, vice president and
Gartner fellow, and member of the CEO and Digital Business Leaders research group.
Its more of a technology preparing the ground than actual business change, LeHong
said.
25
It seems that many organizations are preparing experience group to bring together employees across
for digital enablement: The most popular digital departments to develop new ways to reach their
measures that companies plan to implement in 2017 market, and revamped their infrastructure, apps, and
are moving systems to the cloud, shifting to online kiosks. The company also opened an innovation
digital tools, using data analytics, and using social center in San Francisco to test new technologies
media, according to a recent Tech Pro Research in a live environment to try and get ahead of the
study. consumer.
Part of this process should include building a They learned how the physical aspects of customer
cross-functional digital team, said Gianni Giacomelli, interaction needed to change, Solis said. Every
chief innovation officer at Genpact, and head of aspect, web to mobile to app to cloud were all done
its Genpact Research Institute, which has studied to create a unified customer experience for a higher
digital transformation. Your digital projects should and more advanced series of expectations.
cross organizational fault linesbusiness people, IT
Research from Deloitte also found that 57% of
people, and front and back office people should be
CIOs ranked customers as the top business priority.
represented, he said.
My sense is that a lot of companies are gravi-
tating toward customer engagement and experience
2. IMPROVE CUSTOMER [projects], because there is a tangible benefit they can
ENGAGEMENT see, Kark said.
Evolving customer behaviors and preferences are
the number one catalyst driving organizational digital
change, according to research from Brian Solis,
3. ENHANCE THE
principal analyst at Altimeter. EMPLOYEE EXPERIENCE
Improving employee engagement will soon follow
Many businesses are looking to customer doing so for customers in terms of necessity, said
experience to bring about organized change, Solis Solis.
said. They learned customers and making decisions
differently, and are much more mobile and instant, For example, in recent research, Solis found that
so the tech theyre investing in is to serve a particular most enterprises still provide employees with
need. desktop phones. However, most employees do not
use those phones, due to their use of smartphones
For example, Sephora went through several custom-
and other devices in their personal lives.
er-focused digital transformation projects, Solis said.
The company studied how their customers make Employees are now at the point where if they
decisions, what technology they use and how it have a desktop phone and other old technologies
fits into their lives. It then created a new customer they have to work with, they start to view that
26
organization as being archaic, and not as a desired place to work, Solis said.If the customer experience is
painful or dated, the employee starts thinking about other companies.
Some 79% of companies report that they have reduced paper use by shifting to online and digital tools, while
58% said they use online employee training tools, according to a Tech Pro Research survey. But while just 37%
said they have shifted away from traditional phone and email systems, another 33% said they plan to do so in
the next year.
4. ENABLE THE INTERNET OF THINGS

Companies should look to enable IoT elements into systems such as manufacturing, LeHong said. It will
make your factories more productive, remove costs, increase productivity, and maybe even quality by using IoT
sensors and analytics, LeHong said. Doing this does not change the business model, but does add business
value, he added.
One example of this is General Electric: The company integrated sensors into its aviation, transportation,
manufacturing, healthcare, and energy production businesses, and created software to analyze the resulting data.
Its software and services business made about $6 billion in revenue in 2016--a 20% increase from the prior
year.
Utilizing IoT in manufacturing can also pave the way for larger digital transformation efforts later on, LeHong
said. For example, a manufacturer may be able to use data gleaned from sensors in order to begin selling their
product as a service.
Currently, only 20% of companies said they have implemented IoT technology, according to a Tech Pro
Research survey. However, 30% of companies said they plan to do so in 2017.
5. MODERNIZE THE BUSINESS OF IT

Modernizing the business of IT is often a low hanging fruit for digital transformation projects, according to
Bill Briggs, CTO and managing director of Deloitte Consulting.
For example, AIG applied machine intelligence in its IT shop by automating its IT ticket system. Now, more
than 140,000 tickets are being resolved without the need for an employee. The company was able to redeploy
IT workers to do more impactful projects, Briggs said.
Creating a digital enterprise involves reshaping the way work gets done at the back and mid-office, that will
ultimately impact the front end. You can prove out some of these digital technologies that will have impactful
front and back office implications in the IT shop, Briggs said.
27
It can be difficult to prove backend ROI or a business case to get the needed funding for a project like this,
Kark said. There is a huge amount of back end effort around legacy systems, capabilities, culture, security,
risk management, data, and emerging technologies that need to be in place for digital efforts to be constructive
and appropriate in terms of driving value,Kark said. If you dont do that, the front end is only going to be
beneficial to a certain [point].
28
STUDY GROUP MOVING FROM MANUAL

DR TO AN ALWAYS-ON EDUCATION
PROVIDER
BY ASHA BARBASCHOW
Education provider Study Group first opened its doors to students back in the
1980s, focusing originally on language studies in the UK before expanding interna-
tionally in the mid-1990s after a spate of acquisitions.
Fast forward to 2017 and Study Group now comprises several brands and partner-
ships underneath its banner, each providing education services such as higher
education, vocational language education and online services, ranging from high
school to life-long learning programs.
Currently, Study Group employs approximately 4,500 staff in 120-odd sites around
the world. In 2015 alone, the organisation took in over 73,000 students from 145
countries, studying at around 80 campuses globally.
With the internet allowing people to study in multiple areas and locations, and at
times that they wouldnt normally, Study Group became aware very early on how
important it was to be digitaland how far and fast its footprint was growing as a
result.
OLD-SCHOOL DISASTER RECOVERY

Despite acknowledging the digital age and shifting many of its services online early
in the game, Study Group managed its disaster recovery manually.
The company was reliant on the intimate knowledge of individual members of

the IT team to recall where individual backups were located, and the backup
and recovery process relied heavily on large-scale tape drives, which often led to
labour-intensive operations with high maintenance costs.
According to Andrew Christensen, senior systems engineer at Study Group, the

decision to virtualise its backend was important to give the business flexibility in
how it would deal with the shifting demand in student enrolments across the globe.
29
It was difficult. We had a toolset that was Now that we do have this
disconnected from one to the other, Christensen told
ZDNet. We used ad hoc jobs to backup and maintain concept of always-on and
datadepending on the system that we were using. We an appreciation of what that
used data-moving functions to get data from one place involves, it allows for it to be a
to another quite frequently, often replicating in certain
circumstances. lot more accessible so people
Essentially, a lot of user intervention was required to
can take courses when and
maintain datasets across the organisation when it really wherever they like.
shouldnt have been done that way. Andrew Christensen
Study Group then went to the market to find a
solution that met the requirement of maintaining an always on global organisation.
We have a lot of infrastructure and we have a good structure as a whole, but we werent really giving it the
benefit of maintaining availability, so finding a solution to help us do that was a priority, Christensen said.
When we started looking around, we realised that the solution we needed was based on a hybrid cloud model
that weve seen come into fashion recently.
Enter Veeam.
CLOUD-BASED DR TO THE RESCUE

Were an education provider; students come to us, pay for an education course or a service, and we need
to deliver that, Christensen said. Any interruption to that is a reflection on our service, which in turn is a
reflection on what we can charge for our service.
Maintaining always-on, maintaining reliability, and the reputation that comes along with those thingsits a
big deal.
As Study Group houses a figurative truck load of user data, from course-related student credentials through to
personally identifiable information, including payment termsas Christensen called it, All sorts of personal
data that you dont want people to get their hands onprivacy and security is of the highest importance.
With Veeam in place, Christensen said that protecting the data of its users has become far less intimidating, as
the organisation has now experienced the reliability of always on and the security that comes with it.
30
Since rolling out the solution, the business has seen a 60 percent reduction in
the cost of data retention and storage. Application development costs have been
reduced by an estimated 15 percent and spending on hardware has reduced by 10
percent.
Study Group has also experienced a 100 percent increase in disaster recovery
capability and 60 percent cost savings.
Now that we do have this concept of always-on and an appreciation of what

that involves, it allows for it to be a lot more accessible so people can take courses
when and wherever they like, Christensen said.
REFOCUSING IT TEAMS
Study Groups IT teams now have the opportunity to work on development rather
than system upkeep, with Christensen noting that the projects the teams are taking
on are becoming bigger and more complex as a result.
Our approach towards how we do things has changed slightly, having the
reliability and the security that comes with it, he explained.
Its shifted our focus a little bit away from data protection specifically around
application development. If we can divert resource away from data protection
under the development scope and make that an infrastructure issue as opposed to
a development issue, it means we can put a lot more time into quality applications.
Christensen explained that some of the projects Study Group is now taking on
now are a lot more ambitious, noting that the ability to take on big data projects
and those that combine all of the organisations resources would not have been
attempted previously without having a clear-cut methodology for backup and
protection.
The solutions were working with arent anything too special; were just leveraging
them the right way and really embracing them to get the most out of ittheres
nothing too groundbreaking here, Christensen concluded.
31
HOW DIGITAL IS AIDING LOVESPACES

AMBITIONS TO TRANSFORM ITS
SELF-STORAGE
BY DANNY PALMER
Businesses have more opportunities
than ever to use digital technology to
re-imagine their operations: everything
from the cloud to mobile apps, and
even the likes of wearable devices and
the Internet of Things (IoT), can drive
productivity and efficiency improvements.
Companies of all sizes around the globe

have exploited cloud storage, for example,
easily boosting or reducing capacity as
required.
image: lovespace
This model has proved very successful for
virtual items, but Lovespace, a UK firm
that describes itself as the UKs first storage-
by-the-box company, offers customers the same model for physical items.
Founded in 2011, Lovespace allows customers to store individual items at a warehouse for as long as they wish,
and then have them returned within a day of request.
The idea is, if you think about how cloud storage has enabled the ability to store just a photo online a lot
easier; were doing the same thing with physical items. So rather than buying a whole unit and only using a
fraction of itessentially paying for fresh airyou just pay for the boxes you store, explains Dave Walker,
CTO at Lovespace.
However, despite an operation designed to provide customers with cloud-like storage facilities for physical
items, the company started life with surprisingly little in the means of digital technology infrastructure.
32
FROM SPREADSHEETS TO MOBILE APPS

The actual mechanics of delivering the service to the customer were very
manually intensive, says Walker. At the very beginning, the method of managing
customers was Excel spreadsheets and Post-It notes on walls.
But as the company has grown, it has increasingly turned to technology in order
to improve processes and ultimately customer service, much of which comes in
the form of face-to-face interactions between delivery and collection drivers and
customers.
One of the ways Lovespace has driven innovation through digital transformation
is by taking advantage of the smartphone that every driver has in their pocket.
Previously, the operation revolved around Excel sheets for drivers and warehouse
staff, with drivers entering the postcodes of delivery addresses into a sat-nav,
before crossing the customer off the list following a successful visit. However, this
created difficulties if a customer wasnt in or the visit couldnt be made.
It was very, very manual. It worked, but there wasnt any real-time feedback, so it
wasnt until they got back in the evenings that youd know there was a change to
anything, says Walker.
In order to improve efficiency, Lovespace developed a mobile application with

accompanying scanning technology to streamline the entire operation.
We went from a website with a poor mobile focus to a mobile app which allowed
them to directly see what items they need to pick up and from where. From there,
all they really need is a laser barcode scanner, so they scan the barcodes and get the
customer to sign at the door, explains Walker.
The app also allows drivers to directly contact customers at the push of a button,
should they need to in the event of someone not being in. The roll-out of the
mobile app has ultimately helped Lovespace provide a better service.
Its massively improved the customer service, because we can now say the driver
is on drop number four of seven, youre the next job and were 20 minutes away.
We can give the customer more information and help improve the service, says
Walker.
33
MORE DATA, MORE While Lovespace develops much of its customer-

BUSINESS INTELLIGENCE facing tools internally, cloud hosting provider
Deploying new technology on the front line has Cogeco Peer 1 provides the firm with much of its
also led to a digital transformation behind the server infrastructure, enabling it to meet higher
scenes, particularly when it comes to harnessing demands for service during peak periods. Walker
business intelligence. credits this outsourcing as something that enables
Lovespace to focus on its core objectives.
As weve moved to more digital mechanisms
to work with, obviously we now have all of this Im a strong believer in a business focusing on
data we can interrogate, Walker explains. So its core competencies well; our core competencies
weve been working hard on providing a new arent keeping servers running and having
platform and we now have a much more accurate backupsits not where we can operate, and
measurement. putting resources into that doesnt make sense at
all, he says.
Now everyone understands if we change
something, what itll mean for the business. So it Its much better to put resources that would
allows us to make much better business decisions have been those things into improving our own
at that level. offerings.
Professor David Lamb from the University of New England at the Kirby Smart Farm (Image: NBNCo)
34
IMPROVING PRODUCTIVITY WITH SMART

OFFICE TECH AT VMWARE AND BOX
BY TEENA MADDOX
image: box
The introduction of smart office tech, such as beacons and mobile apps, has improved productivity at VMware
and Box, which both did major installations last year.
Last fall, VMware completed a project that resulted the addition of 2,000 beacons and several new apps
available through its VMware Workspace ONE catalog, the companys enterprise platform that delivers and
manages any app on any device. Theres a v in front of most of the apps, such as vNavigator and vApprove.
35
Through the apps, employees can do everything from approving documents to

finding electric vehicle charging spaces and empty conference rooms, and even
get help navigating across the 105-acre VMware campus in Palo Alto, CA. The
17-building campus has approximately 2,300 employees, so it can be particularly
difficult for new employees to find a meeting room or desk, said Bask Iyer, CIO of
VMware and Dell.
Theres also a feature in the works that will show which
People use it and love it.
meeting rooms are available, and if someone is regularly
booking a larger room than they need, it will ask them to They come to us and give
book something smaller, rather than wasting a 10-person us feedback. Theyre not
room on a two-person meeting.
used to IT giving them
Theyre also experimenting with facial recognition. VMware
things like this.
has a cafe set up where employees can grab a cappuccino
while they get assistance from the help desksimilar to the Bask Iyer
Genius Bar at Apple retail stores. VMware is beta-testing
facial recognition so that employees dont have to put their name on a list when
they arrive. Instead, its automatically added and someone recognizes them and
greets them by name. The next step, after moving beyond the help desk, will be to
add that to the visitor lobby, Iyer said.
But its not just the improved productivity that matters. It also makes VMware
more appealing to current and prospective employees.
People use it and love it. They come to us and give us feedback. Theyre not used
to IT giving them things like this. Theyre used to IT not taking a risk, working
heavy-duty on the back office. This makes us cool. It makes us very relevant
and certain things like this make you come across like an innovative company
that thinks about employee productivity and not just saving costs. It changes
perception when you do things like this. Its one of those surprises that they didnt
expect, because they didnt ask for it, Iyer said.
The pilot for the app began in the second quarter of 2016 and the company
staggered the rollout through the third quarter. The mobile app provides
step-by-step navigation to conference rooms or helps find a colleague at their
desk. VMware began the project by using the existing wi-fi structure, but added
additional wi-fi access points.
36
The fast navigation is helpful for employees not spending much money on this. I didnt give
visiting from other locations, or for anyone in a them a budget. Google says that 20 percent of the
hurry whos not quite sure where something is time their employees work on innovation products.
located on the vast VMware campus. It also allows It was like that. This was set up in hackathons
a meeting room to be released if no-one shows the people time was nothing. We didnt hire
up for a scheduled meeting. With approximately contractors. We wrote the software and bought
2,000 employees, this has proven to be useful. Its beacons. I think we spent peanuts. I didnt see
a huge benefit to productivity, particularly for new it as an approval on my app, so it was under my
employees and contractors, and people who are [financial] threshold, Iyer said.
ADD like me. Its heavily used, Iyer said.
TURN-BY-TURN
One of Iyers favorite things to do is get instant
metrics on usage from the apps. There are 745
NAVIGATION AT BOXS
users on vNavigator as of now. Weve had 11 HEADQUARTERS
users today, 90 users this month. vApprove has In Redwood City, CA, theres smart tech in place
gotten about 318 users this month, he said, as he at Boxs 334,212-square-foot headquarters, which
reviewed the real-time usage of VMwares mobile opened last year. The 730 employees can use a
apps. mobile app, combined with beacons and access
points, to navigate through the office space that
Theres also an app for electric vehicle charging fills seven floors.
spots. It shows when a parking spot is open, or
The building includes proximity center location
if theyre all full, when one will become available.
awareness beacons from Aruba Networks, a
There are 10 users today and a total of 50 users
Hewlett Packard Enterprise company. The
this month on the [electric vehicle] app. An
wayfinding app includes turn-by-turn blue dot
average is about 20 users a day, he said.
navigation to help employees get from one place
We dont make a big deal about publicizing the to the next. Its particularly convenient for visitors
apps. You have to go to the catalog. Its very or out-of-town employees, said Paul Chapman,
similar to consumer [apps]. Maybe we should have CIO for Box. The project is similar to the one at
an internal magazine with mobile apps. We need to VMware, because Chapman was on the team that
figure out a better way internally to catalog, Iyer helped design that build, before he joined Box in
said. July 2015.
And the best part is, it hasnt cost much for We really are replacing the touch interface with
VMware to create and use these features. Were a dialogue interface. Were not necessarily doing
37
anything we cant do through a touch interface, but were being far more productive and efficient through a
dialogue interface, Chapman said.
The headquarters was designed from the ground up, which made it easier to plan out the new smart technology
aspects and make it dense with Arubas wireless access points to support a wi-fi-first facility. Because there were
so many access points, fewer beacons were needed, Chapman said.
One of the things we felt was important when we built out our new headquarters was that we had the most
up-to-date technology capabilities when it came to how people move around an open social collaborative
workspace like Box, where you dont have single offices, where you have a lot of breakout spaces. and the
availability to book and get to meetings was really important for us. We wanted to create as much of a digital
experience and speed to the next meeting. A lot of time is lost between meetings and looking for rooms,
scheduling rooms and expending meetings and things like that, Chapman said.
When someone needs a meeting room, the app shows which space is available on each floor, and rooms that
are being unused 10 minutes after the scheduled start time are made available and reclaimed. We have a
reclaim rate of 17 percent, where effectively rooms that would have been empty but booked are actually being
freed up and reclaimed. Thats a significant productivity gain, Chapman said.
Where were headed is not only with the ability to navigate direct and check you in, were now looking to do
that through voice interaction as well. I can interact to the same application and say, find me a room for four
people and give me directions to that room and check me into that room. That is the next phase of where
were going with that, he said.
Box uses Amazon Echo devices with Alexa voice control for employees checking into conference rooms, and
theyre working with Utah-based Teem (formerly EventBoard) for a conference room application that runs
iPads and iPhones and partners with Amazon on Alexa team skills. Google is used for employee calendars, as
well as Google Hangouts, since meetings and conference rooms are coordinated by calendars, Chapman said.
Printers have location awareness so that documents do not begin printing until the user is at the printer. That
protects sensitive documents from unnecessary exposure. Location awareness is also being used as a credential
for entering the building. Anyone can carry someones badge, but if your device needs to be authenticated
through a PIN on a particular device, then its more secure than swiping a badge, Chapman said.
Recognizing the importance of productivity was a crucial element. We wanted to make sure that as we moved
forward as an organization, we didnt lose sight of how valuable it was to invest in employee productivity. I find
38
that a lot of organizations over time are trading off internal productivity investment with other areas. I know
when were dealing with budgetary constraints its about trade-offs, but its easy to convince yourself to live
another day with internal productivity pain rather than invest somewhere else, Chapman said.
To limit costs, Box partnered with Aruba to be a showcase use case for how beacons could work in the office.
We didnt allocate money for this, and find a partner to make this happen. Effectively the only money we spent
on this originally was time. If we extrapolated it out, its somewhere in the range of about $60,000 to $100,000
worth of software and devices [if Box had paid for it]. However, we do pay the ongoing software subscription
costs and theyre relatively small, Chapman said.
The workplace productivity space is an area that is often traded off over other investments. Thats a fair
approach in a number of cases, but I think over time it become a habit. Its easy to trade off internal versus
something that might be external facing. Over time that becomes a significant impact on productivity and
efficiency and, in turn, morale, and can become a source of attrition and lower productivity. So in todays
environment where you have a strong contingent of your workforce a millennial workforce that has grown up
in the digital world, you have a different style of worker and a new style of workplace that requires a new style
of IT, Chapman said.
It used to be consumer technology was behind enterprise technology, and now consumer technology is
leading the enterprise, he added.
39
HOW CAMPBELL SOUP IS BETTING

ON DIGITAL TRANSFORMATION,
ECOMMERCE, SCIENCE TO GROW
SALES
BY LARRY DIGNAN
Campbell Soup Co., has a bevy of challenges ahead, but its looking to spur growth with a healthy dose of
ecommerce, science-backed nutrition, and new food production models.
Consider Campbell Soups move another data point in the ongoing digital transformation chronicles. Every
company and industry is being forced into digital transformation and Campbells CEO Denise Morrison
outlined a future of real food through strategic foresight.
Morrison outlined four growth platforms, which are likely to take a long time to play out. Heres a look:
Ecommerce: Morrison said ecommerce will revamp the food industry and give companies like Campbell
Soup a more direct relationship with consumers. Campbell Soup is planning meal-kits, buy now functions,
integration with recipe sites, and dash buttons. The company will also invest in ecommerce platforms and omni
channel experiences. What remains to be seen is how these platforms will integrate with retailers and grocers.
Customized snacks with a purpose: The company is investing in the science needed to alter so-called
mindless munching and focus on food for outcomes such as mood and energy management.
Personalized diets via a Campbell funded startup called Habit: It is being tested out in the San
Francisco, Calif., area. The startup aims to personalize nutrition and blend technology, food and analytics.
Heres a screen of Habits testing process to personalize food and tailor it to you:
40
Local food production: Campbell Soup is outlook was weaker than expected. And the
planning small-batch production and more local company is looking to save $450 million by
variations of food. This move is likely to require the end of fiscal 2020. Savings will come from
supply chain and manufacturing tweaks. optimizing the supply chain, becoming more
efficient and integrating acquisitions. Some
Like most digital transformation efforts at well
of those savings will be used to fund growth
established companies, Campbell Soup faces a
initiatives.
bunch of challenges. For instance, the companys
41
WENDYS COOKS UP DIGITAL

TRANSFORMATION PLANS WITH KIOSKS,
MOBILE APPS, CUSTOMER EXPERIENCE
LAB
BY LARRY DIGNAN
Wendys, best known for its square
burgers, is aiming to put digital
technologies at the core of its customer
experience and ultimately redefine the
brand.
The fast-food chain, which delivered

2016 revenue of $1.43 billion with net
income of $129.6 million, highlights
how every company is becoming a
digital one. Whether its a company like
Wendys digital transformation plan revolves around integrating
Campbell Soup or General Electric, mobile, kiosks, and back-end technology in a lab to enhance the
digital transformation is everywhere. customer experience.
At the center of Wendys digital efforts

are self-service kiosks. Wendys was among
the first to use kiosks as a way to control labor costs, and the restaurant chain garnered a decent amount of
attention. Why? Wendys was seen as a good example of what happens when the minimum wage rate is raised.
Sure, labor costs are one reason for the digital transformation effort for Wendys, but if you zoom out you see a
much broader plan.
Technology can play a great role in creating a better customer experience, unlocking productivity, driving
throughput and ultimately saving some labor to help us to continue to have a strong economic model, said
Todd Penegor, CEO of Wendys.
On February 16, Wendys held its investor day and outlined its 2020 goals, which are aiming for global
restaurant sales of about $12 billion. To hit that revenue target in 2020, Wendys executives said they have
42
mapped and prioritized

markets globally and
identified a more than
50 percent growth
opportunity in the top
20 markets. Wendys also
looks to complement local
partnerships with franchisees.
So whats the plan? David

Trimm, chief information
officer at Wendys, outlined
how the company will
become digital. Trimm said
Wendys has to be a digital brand to stay relevant. Everybody, whether you are a millennial or not, is now
expecting to interact with brands via digital channels, Trimm said. And they are also expecting a response to
that at digital speed. So we are absolutely going to be judged on the basis of our digital experience in terms of
our brands relevance; if you dont have it you are not going to be relevant.
Meanwhile, to be relevant Wendys has to cultivate a loyal base of customers. If digital transformation is done
right, it can create real stickiness for the customer experience, Trimm said. Toss in the efficiencies and cost
savings that information technology can bring and Trimm and Bob Wright, operating chief at Wendys, believe
they can change the financial profile of the company.
Heres a look at how Wendys is approaching its digital transformation.
Bring multiple disciplines together. Wendys has created a lab, called 90 Degree Labs. The lab has been
around for a bit more than 18 months and is outside of Ohio State University. Trimm noted:
It is staffed with engineers and experiencecustomer experience, user experience experts as well. And it
produces three products for us. And those are our website Wendys.com. It is apps for popular platforms, the
Apple iOS and Googles Android. And it is also those customer self order kiosks. We believe that bringing
together the expertise that we have there, the built environment, and the processes that we have is creating a
technological source of competitive advantage for us.
The ultimate goal is to build the Wendys of the future.
43
Use an agile development process. Wendys has adopted agile to rapidly

prototype processes and approaches. The general idea is to iterate on technologies
and launch new versions of the front-end software that will improve the
experience.
Be customer-centric. At 90 Degree Labs, problem solving has to be at the

forefront. We spend a lot of time talking with customers about what it is that
they need, what problems they are trying to solve, and then attempting to meet
those needs through the things that we are doing as part of our agile process, said
Trimm, who noted that Wendys brings in customers regularly. Wendys will go out
in the field to randomly have customers try out new ideas.
Remember the food. Technology can also be an enabler in the kitchen via
automation and processes that can make food more fresh and made-to-order.
Via mobile ordering and kiosks, Trimm said customers can get customized food
at the right place and time. We were always going to make that sandwich fresh
for you, including any customizations that you might have ordered. We werent
going to ever make a standard built sandwich and leave it on the side hoping that
a customer was going to come along and order just that thing. So, customization is
absolutely built into our operations process.
44
Dont forget the foundation. Wendys has spent a gateway drug to more mobile ordering. Trimm
the last year investing in one point-of-sale system elaborated:
across its network to bolster efficiency. That I think eventually everything will be mobile, right.
standardization, which can be tricky when working I think everybody sees that as being written in
with franchisees, allowed Wendys to develop once the future. However, kiosks do give us a stepping
and iterate. In addition, process, product changes, stone to that. Because I dont need to persuade
technology, and the operating model all have to anybody to download anything to be able to
align. If the foundation isnt in place its difficult to use a kiosk; they can just go in and use it. Gets
deliver a consistent experience across all physical customers use to self ordering, gets them used to
and digital channels. Wendys also consolidated navigating our menus, and so on. So we think that
apps for easier management. The trick for Wendys is a really importanta really important direction.
is to roll out that foundation across its network. Kiosks first leading to mobile certainly over time.
For instance, kiosks will be rolled out aggressively Physically having the kiosks does give us a
in 2017. And theres a good reason for that rollout: tremendous opportunity to innovate on the
A trio of kiosks will run a franchise $15,000 and software. We can keep deploying new versions of
deliver a payback within two years. the software as we come up with new ideas and
you will see some of that certainly over the next
Collect data. With kiosks, apps, and its point- few months as we start to bring some of those
of-sale systems Wendys can manage lines, plan things into the market.
kitchen capacity, and use front-end analytics to By using data, Wendys can continually tweak the
improve the experience. One insight: Kiosks are experience.
45
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32 How digital is aiding Lovespaces ambitions to transform its

35 Improving productivity with smart office tech at VMware and Box

42 Wendys cooks up digital transformation plans with kiosks, mobile

DIGITAL TRANSFORMATION: RETOOLING

How these incumbent enterprises manage the introduction of new technology

Lets take a look at some recent studies on digital transformation.

WHAT THE SURVEYS SAY

Here are the key findings from Forresters study.

Mature digital businesses are rare (just 11% of companies surveyed).

Here are some of Altimeters key findings.

Customer experience was the top driver of digital transformation (although

As noted above, Altimeters survey found customer behaviour to be the

image: 451 research

Just over a fifth (22%) of respondents rank optimising customer experience

Personalisation, and channels that lend

Looking further ahead, the most exciting

DIGITAL TRANSFORMATION IS A WORK

As outlined in this infographic, almost

transformation technologies provided

DIGITAL TRANSFORMATION: MAKING IT

MARKETING: HOW TO CREATE A DIGITAL-

Clarke points to best practice examples in strategy.

HOW TO USE DIGITAL

ASSESS THE LANDSCAPE The challenge of IT

WANT TO CREATE DIGITAL

To consider this question at closer range, lets look at digital transformation.

Does initial buy-in require a formal plan?

Here is what leads me to say this.

In a recent Tech Pro Research survey on digital transformation, 28% of respondents

Hes rightand many companies with their distributed digital transformation

Sustainability depends on a continuous chain of project successes, and those

These are the final payoffs.

8 OBSTACLES TO OVERCOME IN YOUR

Were at the cusp of trying to understand what digital is

Digital transformation involves a significant change, and usually changes to

Organizational siloes are one of the biggest impediments to digital transformation

5. THE DIGITAL ICEBERG

6. LACK OF DIGITAL LITERACY

7. UNDERSTANDING CONSUMER DEMAND

8. PARTICIPATION WITH DIGITAL GIANTS

Image: Wayne cunningham/Cnet roadshow

FIVE WINNING PLAYS FOR DIGITAL

analytics, and using You have to look at your business context,

1. BUILD A CROSS-FUNCTIONAL DIGITAL TEAM

4. ENABLE THE INTERNET OF THINGS

5. MODERNIZE THE BUSINESS OF IT

STUDY GROUP MOVING FROM MANUAL

OLD-SCHOOL DISASTER RECOVERY

The company was reliant on the intimate knowledge of individual members of

According to Andrew Christensen, senior systems engineer at Study Group, the

CLOUD-BASED DR TO THE RESCUE

Now that we do have this concept of always-on and an appreciation of what

HOW DIGITAL IS AIDING LOVESPACES

Companies of all sizes around the globe

FROM SPREADSHEETS TO MOBILE APPS

In order to improve efficiency, Lovespace developed a mobile application with

MORE DATA, MORE While Lovespace develops much of its customer-

IMPROVING PRODUCTIVITY WITH SMART

Through the apps, employees can do everything from approving documents to

HOW CAMPBELL SOUP IS BETTING

WENDYS COOKS UP DIGITAL

The fast-food chain, which delivered