Aaron Conant  0:18  

everybody, happy Tuesday. My name is Aaron Conant. I'm the co founder and managing director here at BWG Connect where networking and knowledge sharing group of 1000s organizations who do exactly that we networking knowledge share together to stay on top of the newest trends, strategies, pain points, whatever it might be that shaping digital as a whole. I spend a lot of my time talking with these organizations, their startup, the fortune 100, up pretty much every vertical that's out there. And when the same topics come up over and over again, we host an event like this. And so what's really been interesting over the past, I would say two years, especially this is going back, you know, five, six years since we kicked this off was the idea of digital transformation. But it's really been over the last two years that I think there's been a lot of legs underneath it. And you know, we've just got a lot of questions that have come up over and over again. And so there's some good friends, partners, supporters of a lot of brands and large organizations in the network that agreed to kind of jump on the call today, and kind of walk us through what that looks like. And so, you know, Holden, I'll kick it over to you first, if you want to do a brief intro on yourself and the organization. That'd be awesome. And then we can bring in Russ and Jarid as well. And then we'll kind of kick off the conversation. That sounds good.

Holden Bale  1:26  

Yeah. Great. So my name is Holden, Bale. Nice to meet everybody virtually, I lead the commerce practice of Huge and Huge is a creative growth accelerator. So we've been doing all things digital, and increasingly physical in the retail space as well. For many years now. We're partners with with big commerce, a leading eCommerce platform and Contentful, a leading content platform and and we've been discussing this subject for clients who have been talking about digital transformation for in some cases almost a decade. What does it practically look like? What do we mean when we say digital transformation? So that's the purpose of today. It's great to meet everybody. And, Russ, I'll turn it over to you and introduce yourself.

Russ Barnes  2:07  

Yeah, thanks, Holden. I'm Russ Barnes. I lead the digital business portfolio at BSN SPORTS, where a large distributor of team sports and apparel and equipment my focus is on transforming our digital offering to provide impactful customer experiences across both the b2b landscape and the direct to consumer relationships that we've had. I spent the last 15 years working across the retail and consumer goods industry, Walmart, Levi's, Macy's, Men's Wearhouse, and the Boston Consulting Group. So with that, I'll hand it over to Jarid.

Jarid Lukin  2:43  

Thanks for everyone. Nice to meet you up. My name is Jarid Lukin on the global scene director for M&Ms at Mars. That means I'm responsible for the M&Ms DTC business, then Mars for about two and a half years. Prior to Mars, I was at kind in a very similar role. And my entire 25 year career has been in digital helping brands and manufacturers like Mars and kind, Lego and Brooks Brothers and JBL all sell directly to consumers online. So looking forward to the chat. Yeah. Awesome. So

Aaron Conant  3:10  

just to remind everybody, we want this to be as educational and informational as possible. So at any point in time you have questions, you can drop them into the q&a section there, and we'll get them answered real time. You can always email them to me as well, Aaron Aaron@bwgconnect.com. That includes for the email, you know, an hour after the call tomorrow, next week, if you ever have any questions in the space, feel free to reach out. But to get them answered real time, just drop in the chat or email me right away. And we'll try to get those answered right during the webinar today. But Holden, I'll kind of kick it over to you. I know you are going to jump in and kind of set a baseline for the conversation today. So that'd be great. You have a few slides to go through. We can do that sound good?

Holden Bale  3:51  

Yeah, that's perfect. Well, I mean, I wanted to tee this up and why we even thought about having this conversation because I think for many of us, we found that those of us who have been leading large scale change work in organizations, really, with digital at the core of what we're focusing on, have found that a lot of the old techniques, the old frameworks and modalities for what we talk about when we mean digital transformation, a lot of the rules don't apply in our new normal after the pandemic. And so, you know, when we look out in this landscape, and we think of ourselves as experts in this space, what we see for many of you and for us as well as practitioners, there's a great deal of noise, right? Every day, there's a white paper, there's new research report, there's a new framework, that's 12 different initiatives. But if you peel back the layers of the onion a little bit, then you look at the underlying data and this is a cross section of huge data interviews with executives Forrester, MIT, their business school, what you find is that many times there are almost existential risks with this topic of digital transformation. So the number of organizations who have abandoned transformations, you know, some analysts estimate that could be as high as 80% failures of so called digital transformation. So names, you know, it's a, it's kind of amazing to me and Jarid and Russell probably laugh at this because we work together sometimes, you know, in the year 2022, the average cost overrun on large scale software projects is almost 50%. Depending on how you measure, it's just I mean, it's insane. You know, it's an insane number. And across industries, when you think about modernization, not that cloud is a proxy for digital transformation, but only 15% of enterprise technology, spending across all industries has moved to the cloud. And when you really, I think, click into it even a bit more, a lot of the times yes, it has to do with technology has to do with capabilities, it has to do with alignment strategy, for many organizations, their ranking the operating model as their biggest impediment to success. So digital transformation isn't just about a new piece of software, a new technology, a new process workflow, it's about almost fundamentally re architecting your business and how you serve your consumers and how you run your business and bring products to market. And so, you know, this is a snapshot of some of the research that we've done with executives, some of the things that we've heard in sort of smaller forums and research interviews, some of the themes that we consistently see pop up in our clients. And you know, what you'll see here, although the technology subject is very important and dear to our heart, not a lot of this has to do with technology directly. So some of the common themes that talk about this challenges with digital transformation is portfolio management. How do you orchestrate and prioritize competing initiatives across regions, business units, products and programs? How do you manage increasingly, increasingly more atomic and almost federated independencies and build that muscle to be able to see how all the pieces fit together as an executive incentives and funding is a huge topic. Many organizations, although they've embraced some of the tenants of digital transformation, maybe they talk about agile, they may still have a one size fits all funding model that's from 10 years ago. And it really in many ways stymies innovation it stymies investment in digital stymies them sort of transforming the underlying business model. And then the composition of teams themselves that are working on this space. You know, we joke about this idea of agile theater, people who say, you know, we're quote, unquote, doing Agile, you know, and you don't really have truly integrated product teams, you don't have the capacity or, you know, oftentimes in organizations that have come from a more bureaucratic structure, you'll deliver more written documentation and requirements, documents and design documents and executive updates, and you actually do the work products than you actually do the technology or the new business or the new product. And then having a hard standoff handoffs across silos comes up everywhere. And so, you know, we're often asked in our work well, when you say digital maturity, what do you mean, and what actually makes a digital leader. So whether you're looking at a company like Apple, or you're looking like a company, like Tencent and Asia Pacific, but our perspective at Huge is that actually the underlying criterion for digital maturity is business agility, its business agility, at scale. It's about being able to react, respond, and in some cases, pre staged the market to bring new experiences to market, new business capabilities, new lines of business, new innovations, new improvements in your value stream. And so underneath all of that, in many ways, is this notion of business model innovation, right? Amazon being as opposed to retail, or then becomes a cloud services provider that becomes a last mile delivery company and a healthcare company and a million other things, looking at a company, Nike moving into pay communities and run clubs, starting as a shoe company, you know, Uber, it makes sense to say, Okay, you're layering on a food delivery business on top of what is effectively our infrastructure. But if you think about it's a different value stream, different processes, different payments, different concerns. And of course, a company like Apple, a hardware company moving into something that's really primarily immediate concern, which is Apple TV, building an ecosystem of value around consumers that are really new business lines, new value of creative initiatives, and, and these things would not be possible without a certain underlying digital maturity without a certain underlying capability. And so for us, we'd like to reframe capability, whether you're doing a maturity assessment, whether you're setting a strategy, to not say it's not just about technology or platforms. It's not just about people in a silo process in the silo. It's about all of these things, these four keys of digital capability. Do we have the right capabilities to own, operationalize and evolve our digital capabilities? Right, are we aligning incentives and decision rights the right way from a process perspective? Is our process fit to scale for the future for international expansion for new technologies for the metaverse for 5g for whatever the case might be? The platform side of course, the technology is super important. You know, people talk about best of breed all the time. I personally like Best of need language, what is best of need for my business and my strategy, what makes sense for investment and partners? Some that's often forgotten. Many of us work in industries, including myself and professional services where we don't do at all strategic partnerships are critically important, who our partners are, how we operationalize them how we set I'm up for success. And where we invest versus where we have partners invest is all critical to the story of how to successfully be a digitally mature company and how to win and digital transformation. And so just a little bit of a frame up, Aaron, on how we see the space.

Aaron Conant  10:15  

Yeah, no, I really liked that last slide. Because I think for the longest time digital transformation, people just looked at the technology piece, are we in the cloud or not? And that was it. And that they're slowly finding out that there's those four different parts to put together I was my, my favorite slide that it is a holistic view that you have to have the people along the way, but I'd like to hear, you know, kick it over to Jarid first, like when it comes to digital maturity, what does that mean? Like with your within your organization? Is you are you along this transformational path right now? And what might that look like? And then, you know, we'll kick it over to Russ. Next, I'd love to get his thoughts and then Holden again as well.

Jarid Lukin  10:52  

Yeah, I mean, on Mars, we certainly are on the journey. Mars is 100 year old, private company. And so it is one of those big shifts that that takes a while the term but to the asset, I never really liked the phrase digital transformation, transformation implies a beginning and an end. And, you know, kind of like a caterpillar transforms into a butterfly, right at the there's no butterflies at the end of this. And so there's always another phase and other stage and other project, or you have to keep iterating evolving. But that's what I love about this business, right? It's always changing, there's always something new. And so at Mars, really where we've focused, is first on building that foundation, where you go back to that last slide Holden just that, it is about more than the technology, it's about the people, it's about the process. It's about the way you do marketing, right, the way you handle customer service, when you know a CPG company is going direct consumer, all of a sudden is a 24/7 business, right? That's not something we're used to, that's something our systems are used or an ERP, you take down on a weekend install an update, right? You can't take a website down on a weekend to install an update, right? So there's all these different things that you know, these mature organizations need to adapt to. And that's what that's where that agility comes into play. And it takes time. So you know, we're still you know, in the beginning stages of our journey.

Aaron Conant  12:09  

Yeah, really quick, what was what is step one, I think, for people, what was your step one, I think, is a good way to put it, because people are looking for that first step. They know they have to do something, maybe they've done 15 different things. But in your mind, what's a good step one?

Jarid Lukin  12:25  

Well, it starts with my assessment. But even earlier than that, to where you were saying before, you got to know where you're going. Right? And so, you know, we had to put together the vision and the strategy, who do we want to be right? You know, the company that's been built over the last 100 years, it's gonna look very different than the company over the next 100 years, right. And we are in this for the long run. And one of the benefits of being a private company, right, we don't have to think month to month, quarter to quarter. And so that was kind of the first piece of work, when I joined is where we want to go. And then you figure out where the gaps are, right? And you start to put together a plan of how to fill those gaps. Awesome,

Aaron Conant  13:02  

Russell, kind of kick it over to you with that same question around like, where do you fall in digital maturity, as a whole? You know, what is that path? The the transformational path, or I actually, you know, Jarid, I really liked what you said, right? There isn't an end, right? It's gonna keep evolving nonstop. So how do you look at digital maturity? Right?

Russ Barnes  13:22  

Yeah, I mean, coming from the type of roles that I've had in strategy. And as a general manager, for me digital maturity, is how well is organization equipped to meet our customers needs, whenever those customers needs are like, How well can we do that, and what gets in the way. So I really like Holden's framework of the four Ps. Because sometimes it is a platform, we just can't do things because the platform doesn't support it. Sometimes we don't have the expertise, or the people to be able to deliver what the customer needs from a digital perspective. So when you identify those things, you can remove them, get them, get them out of your way, so that you can actually deliver the value for your customers. You know, in the in the previous places I've been and where I'm at now, I've seen three different types of transformations. And I've been been part of. So the first one for me was really around capabilities. We see this a lot in retail, with omni channel capabilities, right? So some people will always look to the future and say, hey, I want to have this sophisticated delivery, get it whenever you want to know where the product is, but they have poor inventory accuracy, right? So you can take digital and use that to make your inventory more accurate, which then powers your Omni channel roadmap which leads to inventory lookup can lead to both this can lead to same day last mile delivery and all of those other future ambitions you have. So you know, at Walmart at Levi's and put it RFID or, you know, digital tools for inventory management to improve the capability to allow us to do more for for our customers. You know, another transformation that I've been part of is a financial digital financial transformation. So eCommerce At a lot of places kind of starts off as a clearance or a discount channel, it has low margins, it's a way you liquidate, you know, inventory that you want to get out of. So how do you take it from that, and using the customers that are visiting you, and slowly, but quickly migrate yourself into better top line revenue, then moving that into improved conversion with the traffic that you're getting to make it more efficient. And then really building out the margin, Men's Wearhouse did a great job with that of moving from a discount channel online into a dominant way to buy buy suits online. And then the last one, for me is a business model. So that's where I am right now, in a primarily b2b world that has a lot of direct to consumer relationships. And in a world where the b2b customers, the ones that are spending the money, are also shopping at Amazon and Walmart and all these places and have that expectation. How do you change your business model from being primarily in the analog world into the digital world, and there's a lot more complication with that digital world has a lot more customer touchpoints than the one to one relationship, you might have analog world. You know, b2b customers have different expectations than they do when they're shopping that direct to consumer mentality of how soon I get my stuff, how quickly I can view where it is, and the accuracy and timing of the delivery. So those are kind of three different worlds that I've lived in for digital transformation. And I think it's similar to what Jerry and Holden was saying in terms of you got to have your ambition, and you got to have your focus for what you're trying to do. It's not just a magic box that appears down the line. They also,

Aaron Conant  16:31  

you know, Holden, I see you're like shaking your head a lot. Like, we'd love to hear your thoughts. Yeah. And you have that unique perspective of, you know, working with a ton of different organizations, we'd love to have any, you know, hear any thoughts you have or threads, you can pull.

Holden Bale  16:45  

Right, my initial thought was, I don't know if I agree with Jarid because taking a website down over a weekend is something my 401 K provider is very okay with. So, you know, some industries around, you know, I had Huge I am responsible for our consumer categories. So consumer financial services, retail, travel, hospitality, and CPG, QSR, those kinds of things. And I think there has been a tendency to assume that because those organizations tend to be more DTC where the CEO is an end customer, not a b2b customer, they tend to be a bit more fluent in digital experience and investment, digital capabilities. And I think one of the things that's interesting though, is you have to think about the application of digital maturity, to various aspects of your value chain. It is certainly in relation to the customer experience. But there are things that CPG companies do that are amazing and supply chain that healthcare companies deal with like cold chain and provenance and blockchain have been doing it for years. They didn't need some like IBM press release to talk about it. They've been doing it for years. And so innovation comes everywhere. And I think the one thing that I'll say I was at Nordstrom, we were rolling out a new business format, I was target when we were rolling out grocery, I was at J Crew and very much of omni channel work and expanding internationally to Hong Kong and the UK and, and all of those required a substantial investment and digital fluency across the four P's, the people, the human capital and technology platforms. The one thing I would say the sort of everybody, if they're in the middle of transformation or not, is I found there's a tendency to lose heart to a certain extent, when you're like three years into the thing that's 25% over budget. There's also a tendency to look at,

to frame sort of digital upstarts as leaders. And I don't think that's true. And so I can promise you that many of the technology companies that you look at it, you think, Oh, they have it all figured out. And they're very big names. And they're talked about frequently, I can guarantee you they're pretty messy, internal and reframing it to be about many of the companies, especially in retail, like digital digitally native vertical brands, you know, they may have had digital aptitude, they may have have the skills, they have engineers, they have product managers they have, they have people who know this space, they know how to create an app they know to create a website, they know how to, but they didn't have scale. And a lot of legacy companies have scale. And to me, maturity is not aptitude. And it's not scale, it's been at the top right quadrant of both of those things. And many organizations that are turning the battleship will be more successful and have been more successful growing digital maturity, and those that are starting from an aptitude space, but have no idea how to scale that have no true idea how to scale digital capability internationally. Who

Aaron Conant  19:24  

a question is comes in ovo who owns this within the organization? So Jarid, who, you know, where do you lie? I mean, you own it. But where does that lie typically within an organization?

Jarid Lukin  19:34  

I mean, so in my career, I've reported into the CMO into the president of sales. It varies a lot by organization. But to me, the key is the cross functional team. Right? Because it's not about reporting lines, but it's about one team aligned to the same goals and objectives. And you know, the organization's where I've seen it fail is when they separate the technology from the business team, right? It can't work that way. I like to say it's the E and eCommerce, right? Electronic commerce. That's the technology piece. And if you try to tear that apart, it'll never work. It needs to be one team that's integrated together with the same goals and objectives. Again, it's not about reporting lines at Mars, our technology team does not report to me. But we all sit in the same meetings, we sit at the same objectives, and we all are marching to the same song sheet.

Aaron Conant  20:24  

Is there? So it's a couple other questions that pop up? Like, what would you? What would you do different? You know, what do you wish you knew at the outset that, you know, now that you wish you knew then, because I'm trying to like I want to capture, like the first part of this, right like that, because I think a lot of people are right there. I think, you know,

Jarid Lukin  20:43  

it's always gonna take longer and cost more than you think. Right? You go in with the best laid plans. And so that's why it's important to have kind of wins along the way. You can't take these big bang approaches, you know, again, I always compare it to kind of the ERP projects of yesteryear, where you send the team off for two years and lock them in a room somewhere, and then they come back and roll out some solution. That's not how this is, right? Because the world is gonna look very different in two years from now, just like it did two years ago. You think about, you know, when we kicked off one of our projects, we call it digital reimagined, because again, didn't like the transformation word. And we kicked that off back in 2020. Right, that was pre pandemic, pre war in, in Ukraine, right? Pretty inflation, pretty Yeah, all the supply chain hiccups, or all these things have happened along the way. And so you've got to, you know, build that in and account for that, and then be able to adjust along the way. I never for once considered war would be a risk to my project. But we've had developers and QA resources in Ukraine that were directly in that, right. And so that those are the kinds of things that come up with any large project. And you just have to make sure you keep that agility to be able to adjust as needed.

Aaron Conant  21:59  

So if I kick it over to you, I'm going to just, you know, think about the the financial piece of it, right? Which is, you know, just like, hey, and you, my guess is you're gonna say the same thing, hey, it ends up costing more, but in the current economic climate, I mean, that's, you know, really important to people to keep that under control. Right, like, how do you maximize each dollar that spent, you know, how do you, you know, just really pay attention to that and make sure that it's valuable, what you are requesting and what you're spending

Russ Barnes  22:30  

as well? Yeah, I think there's, there's two ways of looking at it, you have an investment that leads to financial return, right, your your typical ROI, and you do want to have a understanding of that as you go in, and you want it to be very believable, right. And in bite sized chunks, it's not, we're going to spend X over three years and over five years, we're going to make why that's that's too long, right? So having those, you know, more near in value proposition. But the second way that I that I lean towards a lot is it's about learning, you're on a discovery process with the transformation, you're now going to this end stage where all of a sudden, money's just flowing in faster than you can count. It's a discovery and a learning process. So every dollar that you invest, you're going to learn something from it, right. So all of the things that I'm doing now, when allow me to learn so that the next dollar that I invest, will be even smarter, and then the next dollar will be even smarter, because by the time you get to the end of that you're making really big investments that seem really smart, but it's because you spent the money and spent the time and the resources ahead of it getting there. So you know, is this definitely a blend between the two. And, you know, my roles now have the p&l responsibility with it. So it's something that I'm very mindful of, as I try to evolve the business over time in terms of keeping that the technology investment in learning at the right pace, so that we can continue to hit higher highs as we talk.

Aaron Conant  23:58  

Yeah, a quick reminder, others have questions, drop them in the q&a section there, we'll get them answered for sure. But sticking on this topic of, you know, the financial side, you know, Holden in your mind, what are the no regret investments when you're advising, you know, all these different companies where the a you have to have or, you know, how should they, how should they look at that

Holden Bale  24:18  

space? Well, I mean, first of all, I think you have to separate Vitiello from innovation and growth work and ultimately, you know, there's an idea in digital product of the teams who build things DevOps philosophy, they need to run thing, but, you know, no lose investments, which is, which is a questionable subject. I think anything that advances digital maturity in an organization is a bit of a win is coming back to some things that both Russ and Jarid have said, anything that allows you to be stickier with the consumer, especially as we're seeing recessionary indicators, anything that allows you to take cogs out of your value stream so you might be a cheap merchant. And there are some amazing process received through a prose piece of technology for more algorithmic demand forecasting, that is perhaps a investment that you keep on the front burner, even a recessionary model because you know, it's going to take cost out of your organization. If you're nearing or Eros, it might be, you know, we're investing in a core eCommerce platform, because it's a journey for the next three to five years. That is something that is really a foundational unlock, that eventually relates back to a consumer experience, you can draw direct thread. And in fact, that's one of the conversations we have. If we go into projects that are like, quote, unquote, rescue missions, or we go into things where people are implementing a lot of technologies will say, Can you draw a line from this initiative to the corporate strategy? Can you show us how this relates to those OKRs. And if this is the foundational unlock, that's fine, there's a lot of education all of us who are digitally astute need to do with other executives to say, hey, sometimes you just need to invest in the core infrastructure. But anything advances those, those core concerns of stickier consumer engagement, explorations of loyalty programs, forms of like mass customization, and personalization, there's almost always value on those initiatives in the long term. If you build the organizational muscle to learn from it. If you just implement a bunch of technologies, and you don't build the human capital, or the process around it, then most technology investments are actually lose propositions. No, I

Aaron Conant  26:23  

truly love that that last slide that you had, which is exactly but I think that's what a lot of people have done over the past few years is, you know, everybody thinks they need, you know, the CDP, they need to replatform, everything needs to go to the cloud, I need all these data sources. And they just keep buying them. And hopefully, magically, it's going to all intertwine and figure itself out. And there's, you know, three other pillars that they're not even poured into let alone connectivity of everything that's out there. And

Holden Bale  26:49  

again, it becomes a you know, that's the idea of Best of need, versus necessarily like best of breed. And that's true for everything. It's not just technology, it's people's processes. What is core to your potential strategic advantage in the market, what will create durable competitive margin for you as a business, and that should be where you're laser focused on investment in innovation, and everything else, you should be ruthless, we should be ruthless. And cross cutting should be ruthless in efficiency place focus on what is for your business for for folks who are in consumer categories, it's engaging with customers quality of the product, but that may not be true for all categories. So I believe in this idea of right sizing, not a technology strategy, but a capability strategy, a digital transformation strategy that is necessarily harmonized with where, you know, the business needs to go with where the board knows where the CEO knows, and and every once in a while you run into a scenario where somebody's like, Oh, why are you implementing the CDP? What's gonna be right could be right for a lot of people. It's like, oh, I don't know, some people thought we should do it. And we saw it at a conference. And it seems like the thing to get well, do you need to unify customer data, or b2b side data? What are you going to do when you have that CDP? What is it going to unlock for you? What are the five initiatives is blocking right now? And if you can't answer that question, what you do if you know,

Aaron Conant  28:08  

you have it is that we're a Huge comes in, like a you step in and help do that full blown analysis, because I think that's where you're at right now, the outside view is, it's so much different to bring somebody like you and they say, Hey, piecemeal this apart and tell us what we should do. I mean, is that like the standard where you'd come in and help them figure all that out?

Holden Bale  28:27  

I say, it's very common that we come into clients who are a little ways down the road on something and some of the foundational strategic assumptions of it bear questioning, which can be a very awkward conversation. But I think Jarid and Russ, have both been change agents in their career. Like, I know, Russ, you were brought in to be a change agent and your new business in particular. So I think all of us who have played that role, whether we're consultants, or whether we're inside the house, it has to start from first principles of what is the business strategy? How does the chain strategy ladder up to that, and there really are times where one gets ahead? And the other and, and you know, sometimes the answer isn't perfect. Sometimes you do have to take a leap of faith on certain technologies, people who have been investing in the personalization space for the last 10 years have been trying a lot of different things. And for some businesses, it's led to, you know, I have 10, different personalization technologies implemented, and all of them are kind of so so and it's a pain in the ass to imagine. For other people. It's turned into Oh, that really helped us figure out the three areas where we should really double down on personalization. We got rid of the other stuff, we unified around these three things, we modernized one of them, and that is a that is a muscle that is a business muscle to truly test and learn. And going back to Jairus point to really have a ball where you're taking this transformation journey. It's not just something that somebody set into motion, you know, some consultants and demotion six years ago, it shouldn't look different than it did six years ago.

Aaron Conant  29:53  

And I want to bring Jarid back in just from the standpoint of as we're talking about those different investments you got the short term in, you've got the long term? How are you balancing those the ones that you know, the longer term major initiatives that really build runway? And you know, the shorter term, hey, we have to have these in place. But a lot of times, it's all the same resources that need to implement them. How? How do you splice those two apart? Or how do you decide which ones to go with?

Jarid Lukin  30:21  

Yeah, that's a great question. Because to me, that's one of the top jobs as a leader is resource allocation, right, which is just a fancy way of saying prioritization. And certainly it resources are some of the most precious resources. You know, Mars, again, we're private companies, that does give us an advantage, right? Because it gives us the freedom to take a longer term perspective on many investments. But it's both we've got to do both the short term and long term investments. And so when it comes to short term, like, like Russ said, I'm also looking at from an ROI perspective. Now, the ROI could be financial, but also it could be first party data, or it could be consumer insights, right things that eventually will have financial payoff, but that's how I'm looking at it, especially as we're in the midst of a big eCommerce platform project. And I know the old platform is gonna go away soon, I have to decide what do I want to invest in the old platform, just keep the lights on. But we make those investments, because, again, if I can realize that ROI in the next three, six months, whatever the timeframe is, it's worth it. Right? And so that's how we kind of approach the problem. It's not easy, right? It's competition that comes up frequently. Do we want to do A or B? Because we do live in a world of limited resources, but we definitely look at it from both angles.

Aaron Conant  31:41  

Yeah. Richard, love to hear your thoughts. So there too. And then I also want to move into the people side of things as well, because, you know, all these initiatives in, you know, the best platforms and you know, tech that's out there all requires not just the IT side to get it implemented, but then using it on the back end as well. Whereas How are you looking at long term versus short term investments, and then you can kind of jump into the people side of things. Yeah, it's

Russ Barnes  32:09  

a bit high level. But I like what Holden says in terms of like setting the ambition and setting the need that you have, right? A lot of people start with solutions, whether it's a CDP or a replatform, I've heard about these solutions. And I think we should have something like that, really starting in the short term with being crisp about what your need is, and then bringing in the right problem solvers, because you got to figure out how to solve that need in the short term with the right amount of capital, versus the long term with the right amount of capital. But if you just jump to the end, and try to deploy that, that's where you start getting these three year projects that have significant cost overruns, as opposed to we messed up on step one, which was supposed to be just a couple quarters worth of work, you know, so I think having those problems all that can help you find that ambition in the near term and ladder up to the some subsequent steps. To them long term. Ambition is how I think about it.

Jarid Lukin  33:03  

I love that kind of solutions versus problems. Because many times I've seen people come up with solutions to try to find a problem right in reverse. You've got to start with the problem first.

Holden Bale  33:14  

And a lot of these big transformation initiatives kind of become like the one, you know, bus that's leaving the station. So you get like a lot of Yes, and excuse me, guys get on this case. Do you mind if I bring this bag of this thing that I've wanted to do for three years and put it on? There was like, Sure, yeah. Well, I mean, that is how that's why the suspension on the bus breaks going around a curve, you know, and I think, again, if you've not really tightly rationalized a business strategy, and that was Matt, I'm a recovering management consultant. But I used to just like go work with incoming analysts like strategy is just all the stuff you're not going to do. And whatever is left is the thing that you are doing like that's functionally what the list is. And if you don't have that, then forget about digital transformation initiative, like any initiative you have is not really going to have the return on value you expect it because without that alignment, why are you doing this? How does it ladder back up? How did these capability decisions? How does this journey enable that goal? You know, things really end up listless with very large budgets attached to them.

Aaron Conant  34:17  

I love it from the standpoint I know a lot of organizations right you step one they do they get it right? Maybe they go in, they have the strategy, and they they know where they want to go and end up and then they try to retrofit all their current technology and try to reverse justify why they made all these right decisions rather than say, hey, what do the next one right is what do we need? How much does it cost? You know, what are the right people to do it? And you can start building out from there. Yeah, having at some point in time, a lot of cases I think Holden your Sandy get in there, like a lot of it's just a sunk cost. And those are hard conversations to have. And especially if you're new to an organization like Russ, you get hired in Jarid you get hired in and You're the one that has to put the brakes on what 18 People just spent the last two years doing. But that gets to that change the transformation piece democratization, however, we want to talk about it, you know, that really gets shaped around the people that you bring in, right? Like, how do you, you know, Russ, I'll kind of start with you. Like, how does that shape? You know, your view of the organization as a whole?

Russ Barnes  35:27  

Yeah, it's, it's very different when, when you're doing digital transformation, you're not trying to get back to some greatness that you used to have, right? You're trying to do something new that you don't know much about. It's unchartered territory. So for me, the biggest thing is really around education. Right? And you got to bring in people who are experts, whether they're internal to or external partnerships, where you have to bring that expertise and for people to think differently, you know, some you know, some of the topics at places you might not know is things around, like, what is the product manager that focuses on digital? What's agile development? Right? How do you do design thinking or you know, human centered design? What are the eCommerce levers and who has decision rights over those because a lot of times those decision rights might be existing in other parts of the business. In, there's so many more customer touchpoints, that is just re educating that entire process and bringing in the expertise to get the people along on the journey and unleash everybody's creativity and problem solving to get us from where we are to where we where we could be. And the other one is just relearning your customer. When you go into a digital space, you open up competitive threats from a lot of different angles, right? Your mode is probably tougher to defend online than it is when you have a face to face relationship or store that people have to come in. And they're not going to leave without, you know, buying something. So how do you relearn your customer and all of those new touch points so that you can come up with those solutions that you might not have needed in the past? And that just gets back to my approach overall, when you combine those two things of educating everybody plus relearning your customer. You know, this is really testing your way into the vision, kind of taking that crawl, walk run approach. It's not about building that that big flagship store that costs a lot of money. It's how do you learn along the way so that you can keep pivoting with your customer? And getting closer to the to the pin?

Aaron Conant  37:32  

Yeah, I agree. I mean, Jarid, I'd love to hear your thoughts as well. You know, because I think for the longest time, it's been a b2b business, I think wrestlers come from the same spot as well. But from the b2b side as a whole. If that's where you're starting, how do you help your teams that not only navigate but feel comfortable with the amount of change that's always ongoing, especially if you're gonna say, hey, we know you just felt comfortable right here. Not only are we going to initiate change, but it's going to change continuously from here on out.

Jarid Lukin  38:05  

Yeah, you know, I agree with everything Russ said. I mean, it certainly requires a different mindset, different skill sets, that could be different resources could be external partners, we work with you and other companies like that, to bring in some of that external expert expertise. The other thing I would say is, and you can see, from all the different people and companies represented on this call, you're not alone, right? These challenges aren't unique to your individual company. And so I'm a huge proponent of networking, and just talking to others that are facing the same challenges. We were talking before about shop, talk and Dreamforce. And those types of events. It's just a great, great way to say, Hey, how are you solving these problems? What did you do? You know, have you come across this? Who else have you worked with? Right? What are some of those other partners? That's how, frankly, that's all done, I got connected. A couple of years back, Greg was through one of those types of conversations through a mutual friend. And so you know, to me, that's a key because then you can bring in that knowledge, you can train your resources, and then you can get to work and really learn by doing.

Aaron Conant  39:03  

Yeah, I love that. I mean, that's a great point, I would say everybody on the line today, jump out to LinkedIn and connect with Holden, Russ and Jarid, because it is those just conversations that everybody needs to connect with and bounce ideas off from. And, you know, I think as a group, we can just network and grow together. I'm just thinking about it from the technology standpoint. You know, Holden, if I can get back to you, what's your approach to technology as a whole? strategy we talk people, I want to get a little bit into like tech stack and technology, because everybody like we talked about the CDP space and you know, everybody wants to get into Metaverse and web three, and you know, everything has got to be agile and in the cloud. It's almost overwhelming for a ton of people. How do you approach the technology space?

Holden Bale  39:53  

You know, I'm going to do something I promised I wouldn't do. Is it weird if I present slides, I shouldn't be presenting the slides and I get in trouble. It doesn't matter to me, I think I think one of the things that we like to talk about a lot is digital maturity on your terms. Okay, and this is an you know, I joke, again can make your background as a consultant, I joke about this idea of the pundit, industrial complex, and all of the frameworks and all the best practice in the universe. And that gets you like, 80% of the way there. But the other 20% is unique to your business. And so I often will run a workshop, but it's tends to be with executive teams, saying, Who do you want to be? And where does digital apply? Like what domains of digital innovation matter? And there are times where you say digital, just an enabler, there are times where you say, we want to be digital. First, we want to have first mover advantage in the space. And that answer can be different for different parts of your business. And that is okay, and normal. And then based on that, they're basically indicators to look for their indicators to look for about what it means about your business, essentially, you know, not answer your question about technology, because the only way you can come to an answer about the question of technologies to answer these other questions first. So what does that look like? Are you packaging and reselling capability innovations? Are you active and technology communities, Netflix was perceived to be a technology company. So it was YouTube, because they had to solve a unsolved problem. They had to solve the problem of massive streaming at scale, which when they were created was an unsolved technology problem. They solved that problem. Now, what are the primary business problems that both YouTube and Netflix have their media problems, their content problems, not technology problems, so even at different times, in sort of the arc of the life of your business, you may over index to be digital first versus thinking of digital as enabler. And what that tends to mean, then it tends to parlay into different kinds of investment decisions. What's the benefit of bespoke capability? So let's say, I really want to innovate on my consumer experience in eCommerce well, okay, that's good to know. You want to do stuff differently, you want to do stuff that's modern, you're going to need a set of platforms that enable a high degree of flexibility. But with that is going to come people in human capital needs that people who know how to operationalize that architecture, own it, you're going to need digital product managers who know how to run it, optimize the business, you're going to need content creators, you're going to need merchants, you're going to people who really know where to press where to push how to manage the business, as my spin up a Shopify site, also totally fine. It's not, you know, like you look at like the gardener and the forest are waves and the curves and the quadrants, and the cycles, and all of the things and I think these are, these are very valuable data points. But if you're not starting from that position of what is the best of need for our business, you're gonna make the wrong choice. Even if you pick the thing, that's the spaceship, because maybe you didn't need the spaceship. Maybe you needed the minivan, because you had to get a lot of groceries. And turns out the spaceship doesn't have that much room in the trunk. And so, you know, again, I think investment in capabilities that you know, will uplift customer experience tend to be a wise direction to move in investment in capabilities that you know, link back to some core value stream or operational efficiency, you're a CPG company, you do an incredible amount of product development and sourcing your ideas, new brands, your ID, any new products, you're creating them, you take anything that can make you more competitive in that space, it's probably worth over investing in the best solution. Do you need you're a new startup, you're I don't know, you're here. If you're doing healthcare, something you're doing some sort of like you're doing HR and Payroll benefits? Do you need to create a new ERP from scratch? No, buy one, what do you do if it's not core to your business as a court what you're selling to the market? So there's so much happening in the technology space? And I say this respectfully, I think sometimes the ambiguity is like a feature, not a bug. You know, I sit through a lot of vendor demos, and it's like, they all say they do the same things. And I don't think that's probably true, because I'm asking some very different questions. They all just say yes to everything. And, and it really requires a deep well of understanding internally of Who does your business want to be? And where do you want to go? Before you can even really get down the road on the major capability decisions and having the guts to say, hey, we invested in the wrong direction. And the Daris point transformation is not a project. You're running products, you're running programs, you're running things that will live forever, so it's okay to make those pivot those pivots should be expected. That's your new business as usual.

Aaron Conant  44:34  

Jarid, what's the No, I love it. Oh, I completely agree. Where are you? Maybe the rocket ship is amazing, but you just need the minivan, right? Like it's gonna get you where you need to go. You know, what's the biggest like, tech investment that you've made or the biggest tech rollout that you've made? And then what's the biggest headache that maybe went along with it?

Jarid Lukin  44:58  

We're in the midst of a pretty significant investment right now, for that new eCommerce platform for our DTC business, and we went down that path at all point to try to, you know, see what could be core to our business and from a DTC lens, right? To me that's about differentiated value propositions. There's four reasons people shop online price, convenience, selection and experience. Jeff Bezos actually defined the first three back in whatever was 97, when he did his first the Amazon shareholder letter, experience isn't really an area Amazon competes in if you've ever tried to shop on their site. But that as a brand has manufacturers near and where we can win, because I don't want to compete in price, you know, with with my existing customers, right? I don't want to be a primary like clearance channel. Convenience, I'll never get it faster to you than Amazon, I'll never be closer than your local Walmart store. But selection and experience are the two areas where you know, brands and manufacturers can win. And that's where I've had success in my career. So that could be you know, Lego has the world's largest LEGO Store, right, where they're selling $5 store websites online experience, you know, it could be at m&ms, where you can now print your face on an m&m, right, or when I was at college, we did build your own box of candy bars, right? That's not something Amazon would ever do. It's not something you can walk into a store and do, but using the technology to create those flexible user experiences. And as differentiated value proposition that's an area where you can win. So that's that's where we're investing. And while we're putting so much time and effort into this free platform, now,

Aaron Conant  46:33  

rest, what's the the biggest tech rollout or tech investment, you know, the single best one, I don't know if it's the most expensive, the one that was the most fun.

Russ Barnes  46:46  

For me, the biggest investments are always looking backwards, like looking in hindsight, like, wow, we've been on this journey for a while. And we've put a lot of money in this because he's continued to return where we found the unlock somewhere along the way. So you know, I spend a lot of time in inventory management, like I mentioned earlier. So when you look at the investment it takes to work with your manufacturing, supply chain to tag all of these items ahead of time when they're being produced before they're even sold. That's a really big investment. That's before we even got to the technology of being able to read the RFID tags, right. And then the systems are supported the databases to store the data and like to be able to do all of that ends up being a very large investment. But if you do it incrementally, each one of those are manageable. Until you look back, you're like well, that was a lot of money. I don't know if I would have committed that much. But it's unlocked our whole omni channel roadmap. And now this is a very productive, productive endeavor that we've that we've been on. So that's probably the biggest like that would be one of the biggest ones when you're tackling an entire supply chain. You know, I think honestly, the best investments that I've seen across companies are in likely individual people that come together and make teams of people that are those problem solvers that can figure out what those right solutions are. So whether that's a partnership externally, where you're bringing in the experts, and it transforms everybody's mentality in their in their go to market, or bringing in a leader or a team of people that can be your SWAT team to really move you into that next level of digital maturity. Those are probably the ones I've seen have been most beneficial. It's really hard to quantify, you know, yeah, before that impact.

Aaron Conant  48:31  

They're really like, you know, how you're saying it investment as a whole because it is an investment, and it's an ongoing investment. And so, you know, I'll kick it over to you Russ first and then to Jarid, but like, when you think about your organization, over the coming years, where the investment that you're putting in right now, what does that look like? What is the promised land of digital transformation look like?

Russ Barnes  48:55  

Yeah, I'll talk specifically about the space I'm in right now. Being b2b, you know, you look at how much maturity we have come and in the direct to consumer space, right, we're able to have places like Shopify eBay commerce, that can help just kind of spin up a package out of the box, right of eCommerce, we don't have that in the b2b space, we don't have those same type of tools to be able to just spin up a great b2b experience that takes a variety of forms of payment and you know, brings an order transparency and integrates well with a Salesforce that's out there doing a big part of the work of building relationships, but then handing it over digitally and then back over to the sales pros, sales professionals. So that's, that's the what good looks like is kind of pushing into that unchartered territory of how do we make b2b have that same type of crisp experience that you can have at an Amazon or Walmart or you know, any other place today really, that you expect when you just go to a website to buy something like how do we bring that into the b2b world and you know, figuring out where those kind of Magical technology points are that we want to own to give us differentiation versus places that we can leverage things that have been developed across the board and other industries. Awesome. Love

Aaron Conant  50:11  

it like Jarid and your, how you look at it, you know, digital maturity, what is the, what does it look like? Like?

Jarid Lukin  50:19  

I think, you know, three, five years down the road. Yeah, M&Ms is a multibillion dollar global brand. But from a digital standpoint, we're still relatively immature. And yeah, we got a small digital business in the US and Europe. So there's a lot of other markets that we need to expand to. And I think about the other brands within the Mars portfolio, right? Because there's many multibillion dollar brands. And we're building an engineer, right, a digital engine, from a technology standpoint, people standpoint, a process standpoint, right. And once we build that engine, we can then you know, use that for many other brands in our portfolio, that's kind of where we're at.

Aaron Conant  50:56  

Then Holden, kind of kick it over to you, as we kind of get to the end here, like digital maturity, we'd love to hear your, I don't know your key takeaways. It's been a great conversation, you know, as a whole, and you know, you're a great resource to a ton of organizations out there would love to grab your, your key takeaways from today's conversation.

Holden Bale  51:18  

Well, suffice to say, Yeah, weapon, or like, a couple of years ago, I was at a conference and somebody asked me like, well, what if? What if executives don't believe in an investment in digital technology? And I was, like, find another company to work for, like, I can't, like, are you getting your wants? Because, you know, there's, there's been a thing that's happened where for years, people have said, every company is a technology company, I, personally, strongly disagree with that I think the company you are is the thing you sell. If you sell technology, you're a technology company. That doesn't mean that technology is core to every business. Of course, it is, technology is very, it's absolutely core to every business the way that people are. And so you have to apply that same lens of sort of holistic growth and evolution over time. And so there's probably a couple of things you can do across all four of those PS on the people side. I know that sounds ridiculous, you know, does every big initiative, you have to have a change champion have an executive sponsor? And by the way, does that champion know what an executive sponsor is? And what they do and how to be an effective advocate for the project? Is there a product owner? Is there a product lead? Probably? What's the definition of a product owner, a product leader in your organization? What does it mean? What are the job roles, responsibilities, what execution authority they have? Where do they differ? Where do they pull in? What are their jobs, so just even setting the stage of like the scaffolding of what your teams need to look like to be able to drive any change successfully is mission critical. And I think coming back something jerris very early on a philosophical orientation to this is not a project with an end, we're building a platform, or we're building a product, or we're building a new way of being. And this will always be an evolution. And there will always be a transformation, a new technology and a new this and a new that the opportunity that modernization allows, especially if you're doing like big replac forming exercises, is to actually invest as a company in whole body change. And if you think like this is just something that tech team can handle, or like, I can hire a couple of people from Amazon and have some product managers, and we'll figure it out, you're actually I mean, maybe you could be successful depends on what you're doing. But you're kind of missing, accreting the business benefit of rethinking how you operate, how your process flows work, how you align digital outcomes to business value of how you optimize for velocity to business outcomes, you're actually missing a lot of the boat of the change. It wasn't about unlocking the capability itself, or about creating a new website or the new product. It was also all of the soft and hard skills you learn along the way. And if you don't bring that inside of your organization, it was an incomplete change was an incomplete strategy. So I guess just there's so much time you could spend thinking about the cost of ownership or the cost of the initiative or how you're anti, it's a KPIs, but spend time thinking about the structure of the organization that needs to be able to drive this change effectively. Because otherwise, you're not going to put people in place who have the tools to do the stuff that all the analysts are telling them to do. Awesome.

Aaron Conant  54:30  

Well love it. I see we're pretty much right here at time. Russ, Jarid Holden, thanks so much for your time today. You know, I encourage anybody you have more questions on this space, you need help the organization you want to bring some people and the team over here, just fantastic come highly recommended from a ton of organizations within the network. You've heard a couple of them here. 1% worth of follow up conversation for sure. With that, we're gonna wrap up this conversation today. Thanks again for everybody who dialed in and all the questions that came in hope everybody has a fantastic Tuesday everybody, take care and stay Save look forward to having you at a future event. Thanks again Holden, thanks for us. Thanks, Gary.