Unlocking value in the digital transformation. In the discussion, we're going to go beyond the headline and really focus on a few key elements of how to unlock value and drive traction as many companies embark on their own journey. For this discussion, I'm pleased to be joined by two industry leaders who are driving companies through these change. Please join me in welcoming from Verizon, Shane Sanders and from McKinsey and Company, Scott Sattler. Shane, I think you're fortunate you've had a head start here. You've been working with Anaplan on your own transformation journey for five or six years now. I really wanted to just get started with you and maybe you can share a little bit about what that journey has been like for you over the past several years. Well thanks Dave. I'm excited to be here and what I wanted to do is maybe give you a little bit of perspective as we think about our digital journey. We've been on this transformation journey for probably to your point, about 5-6 years. As you know, any good transformation is around people, process, tools, technology, and data in today's world, one of the things as we thought about our transformation is we really started around the process work, which really set us up for this thought around digital. We've established centers of excellence. We brought in digital planning and reporting tools. We've also looked at automation in terms of how we continue really to drive value within finance. What I will tell you is that it's tools like Anaplan that has allowed us, from my perspective to really begin to accelerate the value that we bring to the organization. When you think about planning, reporting, integration of planning and reporting, also within our particular journey, we started to look at predictive analytics within our particular space. Again, when you think about the flexibility that you need in the adaptability of your tools, that in my mind is what really helps to continue to accelerate our progress. Now, we as Verizon is I think about where we were moving from a real product-oriented company to a customer driven company, we had to continue to evolve in terms of how digital was really going to play in our particular space. How do we improve the customer experience? How do we improve the employee experience, and how do we really drive shareholder value? When you think about delivering those business insights to our business leaders. We're in a space that we've been on this continuous journey. We've also looked at digital tools in terms of consolidation of systems, all of that in my mind as a platform by which is foundational to what we need to do here at Verizon. Automation, digital, self-serve, critical, a finance organization that is viewed as a business partner and a strategic advisor to our business leaders. Scott, so this was a really good example of technology alone isn't going to drive the transformation. From McKinsey's perspective, can you tell us a little bit about what you're seeing in terms of the other drivers of success? Are there common denominators that you've seen across companies to really gain the traction, make the stake? Yeah, absolutely. I think Shane's example was a really good one of how it takes a lot more than digital. What I'm saying is that even in the framing of a digital transformation probably is a little bit of a misnomer. At the end of the day, what you're trying to do is transform the business and then digitization is more of a how than it is the actual objective or the what. I think there was one part of what Shane said, which we see is a hallmark of a lot of really successful transformations, which is actually a binding on an objective. I think you heard Shane say they were aligning on total shareholder return. But I think when there's a very clear value add back to the business, organizations have a clear view of what they wanna do and there's a lot more motivation to actually get there. If you see an organization that's looking at a digital agenda without necessarily a value-add. It very often by CFOs looked at as a cost object. Not necessarily something that's going to create a lot of intrinsic value. When you get an organization aligned behind the value side of a transformation, I want to grow revenue by 10 percent. I want to expand operating margin by 50 basis points, or I want to take 20 days out of my cash conversion cycle, you get a real focus and there's a real tangible outcome at the end of that transformation. You'll tend to see a lot more effort going into it. It'll be a higher focus for the organization and when you get those things working well together, you tend to address a lot more than just the technology so you have to start addressing things like, what are the people's capabilities? What's the organizational capability? Making sure that you're not just taking a process that existed historically and digitizing it, we see a lot of organizations that will take something that happens in spreadsheets, and moving to a piece of technology and think that's the answer. If you take a budgeting process and move it from spreadsheets into a tool, you may get a faster cycle, you may get less work or to some level automation. But you won't get a big shift in terms of the actual value being extracted and so you actually have to go back and rethink the processes and make sure there's clear accountability in that model in order to really be successful. Shane, as business processes changed so too must the people and I know there is quite a bit of transformation on the people side for your business as well. Can you walk us through, what was the role of your team and how did that change over a period of time and how do you really drive this down to the people level? What we like to do is we like to talk about in terms of intent process. How does intend process to what Scott had talked about, how do we really drive efficiency and effectiveness and at the same time, understanding to Scott's point around the capabilities? Our particular team, which is a finance transformation team, we're really focused around how do we drive real consistency around the organization. We actually look at org design. We also look at capability building. What are the future skill sets that our organization will need in order to be competitive? We started to look at curriculum around capabilities. What capabilities can we develop? What capabilities do we need to really bring into the organization? My particular team is really focused around delivering transformation end-to-end. Again, people process tools, technology and data, and the people in the technology are really the key enablers in my mind, but really moving to a finance of the future. Now, I think what's important when you think about change and change management, which is one of the roles of the team, is really how do we make sure that each individual really understands? How does that impact you? What's the change that needs to occur and where our folks in what we refer to as the change curve? How many people do we need to bring along with us? How many folks are already on the journey with us? Those are the things that we begin to assess so that we can develop real action plans that will make our particular transformation meaningful and we'll stick with the organization. I would also say is you'd think about transformation to real tops down support, I think is critical. Does that make sense, Scott? Yeah. That makes a lot of sense. I think those are all things that we see as hallmarks of really successful transformations. But I think, any transformation without people is going to fail. You can't be tech first. You've got to make sure that you're taking people along on the journey and so for us, I would say the three most important components of that, building on what Shane was saying are, one you really have to create alignment around a specific outcome. People don't know what they're working towards, you will never get there and so creating alignment is something that's really important. The second is you need to have accountability as well. All too often you see processes where there's just a lack of clarity around who's accountable to bring that to life with an example, in sales forecasting or revenue forecasting, a lot of times you see it left to a sales team, where they're planning revenue as a total, but it includes distribution, includes pricing, and includes product portfolio. In reality, there's a lot of different stakeholders that are accountable for different elements and to leave that process with just sales, it will ultimately fail the accountability tests because sales is only responsible for a small portion of that revenue generation. Where we see is technology playing a role in unlocking these processes are actually starting to cut across organizations to allow that accountability to be brought into the process itself. The third piece for us is really around the behavioral design. A lot of times when you see digital tools brought to life, it's done in a way that may present you with wonderful insights. It may present you with a lot of really great thinking. But oftentimes it can fail because people don't understand how to actually change their behaviors and they're not clear as to what are the next steps or the actions to take. Not only do you have to make sure that you can get to the Insights and you can get to the core of what needs to change, but the enablers are in place to actually make the change. Can an individual actually drive the outcome? If you have a new insight on budgeting, is that person able to challenge the budget and have you set the organization up where they can actually change their behaviors? For us, you also have to address the behavioral side as well. Perhaps the hardest component driving behavioral change. I think it is, but you know, what's really interesting is the role that technology plays in behavioral change can be a lot bigger than I think a lot of people give it credit for. I think this was really insightful again, we really appreciate the partnership, Shane good luck with the journey. I know you said it is continuing. What's the future look like for you at Verizon, Shane? Well, Dave, what I would say, we've built the foundation and I think as we think about the journey into the future, a lot of it is what Scott talked about is how do you make sure you've got good integration across the business where you can be agile in terms of meeting the changing needs of the business and the changing needs of the marketplace. I think when you think about the tools, for instance, like Anaplan, taking that to the edge in terms of the planning, scenario analysis for us is really huge. I think COVID actually heightened the awareness around the ability and the need for more scenario planning. We think our journey, we've got the right foundation. It really is going to come down to execution and we look for people, process, tools, and technology, and data really to underpin our journey for the future.
