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Referentiel 2017 : Digital Maturity in european corporate accounts

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Digital transformation workbook, done in partnership by IBM, EBG and the Boston Consulting Group

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Referentiel 2017 : Digital Maturity in european corporate accounts

  1. 1. REFERENTIAL MATURITY DIGITAL 2017 THE DNA OF THE PERPETUALLY LEARNING BUSINESS
  2. 2. SUM- MARY 2
  3. 3. CHAPTER 1 : CUSTOMER CENTRICITY : CUSTOMER DEMAND SHAPES THE VALUE CHAIN pg. 14 1.1. Customer participation in product design conception pg. 20 1.2. Feedback culture pg. 23 1.3. Relationships that are simplified and personalized pg. 26 1.4. Operations and support functions structured by demand pg. 35 CHAPTER 2 : ARE ENTERPRISES HEADING TOWARDS BEING DATA- DRIVEN? pg. 40 2.1. A work in progress with varying degrees of advancement pg. 47 2.2. The first spectacular results pg. 51 2.3. Data, an IT challenge! pg. 55 2.4. We must go further pg. 57 2.5. The urgency of solving issues of governance and data ownership pg. 61 CHAPTER 3 : OPEN INNOVATION AGILITY: THE CULTURE OF INNOVATION IS A TRUE MOTOR OF TRANSFORMATION! pg. 70 3.1. Innovation digital: companies enter the age of reason pg. 75 3.2. Progress in agility and coming to scale pg. 86 3.3. The relationship between start-ups and large companies: neither are fascinated, nor afraid of one another! pg. 97 CHAPTER 4 : A NEW WAVE IS ON THE HORIZON pg. 106 4.1. How to be prepared for the next wave of technology? pg. 111 4.2. A promise of competition at all levels pg. 114 CHAPTER 5 : ISSUES OF GOVERNANCE AT THE HEART OF THE CAPACITY FOR TRANSFORMATION pg. 130 5.1. Digital governance under discussion pg. 135 5.2. Digital-IT: a precarious equilibrium to master pg. 143 CONCLUSION pg. 152 GLOSSARY pg. 154 CONTRIBUTORS pg. 164 S
  4. 4. INTRO- DUC- TION 4
  5. 5. FROM CREATING A VISION TO BRINGING IT TO SCALE: THE BCG APPROACH The year 2017 confirms that digital is embedded in the DNA of enterprises. The strategic nature of digital is no longer a debate. All medium term strategies now incor- porate a digital dimension comprised of three axes: • The digitization of core processes to optimize profita- bility across all functions, by focusing on methods of acceleration to define, test and scale digital projects. • A focus on growth through offers and business models that are innovative and digital. • Organizations are expanding towards value-driven ini- tiatives, developing agility, data mining, flexible IT sys- tems, and creating an ecosystem of partners. Though the eminent threat of startups and disinterme- diation is relevant for most enterprises, with a more connected innovative ecosystem, the majority are not strong enough to stand against the digital giants. The recent acquisition of Whole Foods by Amazon for 13.7 Billion USD proves that no sector is safe from digitaliza- tion; in this case, the purchase of fresh produce.The dis- ruption is also no longer only occurring from the bottom, but also from the top, through large scale operations and predation. Data mining is also a shared priority: 91% of enterprises interviewed identified a data value strategy. However, the capacity to focus efforts efficiently still needs impro- vement. BCG has found that enterprises estimate that their capacity to prioritize their big data projects is weak, attributing on average a rating of 2.5 on a scale from 1 to 51. Enterprises also expect to streamline the use of data due to consumer pressure and demand for transparency and thus obliging enterprises to adapt their practices. Thus, 30% of enterprises are ready to compensate cus- tomers for using their data. Digital governance has also become widely accepted: 75% of the companies interviewed have a Chief Digi- tal Officer, whose first mission is to manage the digital changes and direction of their group, while maintaining an adaptable and evolving structure. However, the proper execution of a digital strategy re- mains an imperative priority. The challenge is twofold: • To be able to quickly integrate mature and vital techno- logy to remain competitive, such as social and collabo- rative tools, cellphones, analytics, and the cloud. • To prepare and organize for future technological inno- vations: artificial intelligence, Blockchain, virtual and augmented reality, 3D printing, and robotics. La stratégie intègre l’ensemble des orientations digitales 1. “Are You Set Up to Achieve Your Big Data Vision?”, The Boston Consulting Group, June, 2017 5
  6. 6. BCG has developed an approach able to answer the two imperatives, structured in four phases: • Education: The objective of this phase is to understand digital technologies, their implications for the organi- zation and business and to establish a diagnostic, mea- suring the maturity of the enterprise. It is an informatio- nal phase of creativity and discovery, where we help our clients develop their conviction on the benefit of digital for their business during the Tech Tours, Technovision, conceptualization workshops and maturity diagnostics. • Clarification: Involves identifying the areas which are a priority for investment. The result of this phase is a portfolio of projects, varied depending on the sector and level of acompany’s digital maturity. • Acceleration: This phase consists of launching a first wave of short-term projects (3 to 6 months) to obtain results quickly, validating the funding of future pro- jects and creating a positive dynamic within the or- ganization. This phase is also used to test the validity of projects, some projects will be abandoned, others reoriented. • Scaling up: We accompany our clients in the implemen- tation of their digital innovations to the scale of their company. To scale up a “Build-Operate-Transfer” ap- proach can be used, where BCG commits to building digital accelerators for a transitional period and then transfers the accelerator to the client. The “Agile at Scale” model also works to diffuse agility beyond just technological functions. This approach is dynamic. It must continually search for technological innovations (Technology Scouting) in or- der to create a strong mechanism of transformation, able to provide enterprises with flexibility and the necessary reactive capacity to succeed in the digital era. The four phases for a successful digital strategy: from creating a vision to bringing it to scale 6 Introduction
  7. 7. OPEN TO NEW TECHNOLOGY TRENDS: THE IBM VISION The client and the data, the keys to a successful experience This was the principal take away from the study conduc- ted by IBM, the Boston Consulting Group and EBG in 2016: the primary objective of digital transformation is to facilitate the evolution of an enterprise around a cen- tral axe, the client, rather than what has been its traditio- nal focus: products or processes. The client is thus placed at the heart of the organization, and due to data, structured or not, the client’s needs are understood from his or her experience, reinforcing the relationship. INCREASED INTELLIGENCE AND PROCESS GROWTH SERVICING CLIENT EXPERIENCE To ensure that the client is at the heart of their organi- zation,companies must be able to adapt and render their processes flexible. Front office processes must distance themselves from the rigid automated processes that have dominated the last several years. The capability to adapt processes is necessary to be able to support client needs and to identify and anticipate their expectations. Every interaction between a company and its interme- diaries has become a data source, whether the informa- tion is digital or not. The data unleashes potential and allows for cognitive interpretation, being able to analyze a mass amount of information in real time and “learn” from each interaction, including weak signals. We thus move from rigid, fixed processes to cognitive processes, which allows us to service the customer in the most appropriate way. Conversational agents (notably “Chatbots”) are used more frequently and compliment the recommendations consultants receive in “push” mode, regarding the baseline analysis and data in real- time past, present and future. As underlined by Nicolas Thery, President of Credit Mutuel, after the mass integration of Watson alongside its banking agents, cognitive technologyallows a tran- sition to “the literate computer”,with a virtual assistant supporting each adviser, allowing the adviser to unload repetitive and tedious tasks, in order to be able to focus and deliver more services to its client. Nicolas Thery says it “simplifies the life of our advisers, making use of our rich database (…), with a 90% level of satisfaction”. We see the same trend in connected automobiles: “The ability to converse and to learn that is embedded au- tomatically in cognitive systems offers BMW vehicles the possibility to learn personal preferences, needs and driving habits of its driver over time, which renders the experience of driving the most comfortable and safest possible.” 2. IBM IBV “The trust factor in the cognitive era”, 02-2017 7 Introduction
  8. 8. Digital and cognitive industrialization Last year, we discussed four pillars of digital transforma- tion that were identified by IBM to support their clients and decipher the challenge of digital transformation: De- sign Thinking, the Platform, the Academy and the Facto- ry. They constitute an end-to-end approach, in order to be able to experiment, innovate and implement industriali- zation required for digital transformation. These pillars are complimentary and interact with one another, and have evolved with a pillar now dedicated to governance. Results, orientating the industrialization, from the expe- rience gathered by IBM clients are the following: DESIGN THINKING/STUDIO This pillar deals with initiatives, logistical means, orga- nization, skills, and positions that need to be created to treat an industrial fashion client experience, experience that is evolving. It is about creating a permanent capa- city to co-create internally, with clients and partners, as well as to imagine new services driven by the data avai- lable in design thinking. This is what will render possible the implementation of these learning processes, evolving according to the ex- perience of each client and their interaction with the company. PLATFORM The purpose of this pillar is to motivate traditional in- dustrial applications to collaborate with digital systems (engagement systems: client interaction channels, cus- tomer knowledge; system of insight: data, analytics/ar- tificial intelligence, etc.) and emerging systems such as the Internet of Things and Blockchain. Blockchain allows for the sharing of critical information in a transparent and secure manner, as well as allowing for disintermediation. This assures a unique and secure registration of the steps involved in the transaction on the digital platform, allowing for a considerable reduc- tion in time for receiving payment, resolving disputes and thus benefiting from important savings. For example, IBM worked with Natixis and Trafigura on a project to improve lifecycle financing efficiency to arrive at a digitization of documentary credit. A number of sectors, in addition to finance, including agriculture, supply chain, luxury, and pharmaceutical all benefit from the ability to secure, infringe and trace at all levels of a transaction. The use of artificial intelligence becomes a point of diffe- rentiation for the interpretation of weak data signals, both structured and non-structured. The number of si- gnals is increasing with the acceleration of the Internet of Things (IoT), Blockchain, the cell phone and social media, and thus the ability to define pertinent informa- tion, client expectations or even prevent errors. The use of artificial intelligence becomes differentiating to interpret continuously weak signals from structured and unstructured data, whose volume increases with the acceleration of the Internet of Things, Blockchain and always with mobile and social networks, defining the relevant information and expectations of the customer, or even anticipating them. 8 Introduction
  9. 9. FACTORY This pillar deals with the industrial organization of deve- lopments, of their testing and integration by the means of Factory, genuine “agile factories” who will thus per- mit faster ready-to-market time, and an enhanced abi- lity to replicate. Factories tend to use hybrid models that address as many purely agile cycles of construction, as iterative or continuous traditional cycles (V cycles) and their maintenance. GOUVERNANCE The era of digital transformation has seen a new posi- tion of responsibility emerge, the Chief Digital Officer, whose position developed alongside the organization, in particular the CIO and traditional information systems. This has allowed for anaccelerated creation of platforms around digital channels, data or the IoT³. Today, we are witnessing the re-integration of entire information sys- tems, incorporating hybrid models combining operatio- nal IT with the complimentary responsibilities between the CIO and the CDO, rather than a juxtaposition. Fur- thermore, depending on the digital maturity and culture, we are witnessing an evolution of an organization’s trade with the creation of entities responsible for new trades around client relations; by definition, this means fol- lowing and managing customer experience by means of data: personal client data, enterprise management or big data. These evolutions have consequences for existing organizational structures, notably distribution, client services and marketing. ACADEMY STARTUP This pillar deals with the impact of industrialization on human resources across three levels: enterprise culture, to apply a spirit of digital paradigm; management, to ap- ply new collaborative practices and delegate responsibi- lities; and the evolution and adaptability of collaborative competencies to key digital methods (design thinking, agile, DevOps), as well as the retention and attractive- ness of these key competencies. It is key to follow the Academy for the evolution of com- petencies and the acculturation of each generation, as well, as collaboration to take place between new actors and startups as open innovation. Changing management is key to the evolution of an en- terprise’s DNA. It must be hybrid: • On one hand to collaborate with the most innovative of startups in the Scale Zone, where IBM “incubates” a selection of startups to provide the opportunity for an industrialized offer and client-sponsorship • To be inspired by the pure players who incorporate “hackathons” • To integrate the most specialized teams and all genera- tions to form “digital boomers”,offering them an agile and digital culture 3. IBM – From The Internet of Things to Cognitive – The keys for understanding the industry’s digital transformation - https://ibm.biz/IOT-cognitif 9 Introduction
  10. 10. Towards a learning enterprise Client experience and data are the two fundamental is- sues of digital transformation. Improving enterprise performance always requires improvements in the re- levance of the information and recommendations made to users, whether they are clients or employees. Because they are fundamentally client-oriented, the cognitive technologies used to support new flexible processes will be the new standard for a learning enterprise. Welcome to the era of permanent transformation and of the learning enterprise! IBM France Marc Bensoussan General Director Global Business Services 10 Introduction
  11. 11. • Their situation regarding the 5 challenges identified at the end of 2016: 1. Customer centricity 2. Implementation of data-driven strategies 3. Ability to scale up 4. Digitalization of IT 5. Organization and governance of digital • Talent and skills needed to become a tech company • Structure and creation of governance dedicated to inno- vation and startups • Opportunities created by the new wave of technolo- gies (IoT, Robots, Artificial and cognitive intelligence, Blockchain) The qualitative study is the heart of this Referential, whose conclusions are presented around quotes from in- terviewed decision makers. We were only able to show- case a limited example and hope that it is representative of the diverse degree of advancement and inspiring ini- tiatives that are developed in France. QUANTITATIVE STUDY A quantitative study was completed to compliment the qualitative study. This study was administered online between March and April 2017. A survey of 1,214 people was conducted across three primary categories: Mana- ging Direction, Digital Direction – comprising of Digital Functions, Marketing Sales – and Functional Direc- tion. On the following page you will find more detail with regards to the respondents’ profiles. REFERENTIALMETHODOLOGY QUALITATIVE STUDY After the 2016 edition, which focused on enterprises and B2C or B2B2C, this Referential’s aim is to extend the field of study by exploring a diverse number of large enter- prises across several sectors who have important econo- mic weight in Europe. We interviewed and met with 75 key decision makers in the digital field, most often members of Comex or mana- ging directors, proof of the digital transformation’s high level of strategic importance. A quarter of the decision makers are responsible for in- ternational markets, most often European, exceptionally, Brazil or Hong Kong, who offer to give the least surpri- sing perspective. The 2016 edition concluded with the reflections of Christophe Verley, Digital Chief Officer of ADEO (Parent company of Leroy Merlin), who stated “Digital transformation is an ongoing process rather than a desti- nation”, confirmed by the many key decision makers we interviewed. This transformation is no longer a dynamic constant but rather what is in question and what is im- portant today is analyzing the level of economic digital maturity. To do this we interviewed each of the 75 key decision makers for 45 minutes, between January and April 2017, covering the following subjects: 11 Introduction
  12. 12. The industry is relatively unrepresented, 8% of the panel versus 19% of the value-added companies4 , whereas the financial services sector appears over presented, 16.5% of the panel versus 5% of the French GDP5 . The sectors represented are diverse. In this survey, ad- ministered online and based on voluntary submissions, the response rate by sector is a first indicator, although imperfect, of the interest for the subject of digital trans- formation. 16,5 % Banking – Finance – Assurance 11 % Telecom – Utilities 6,5 % 13 % FMCG – Luxury 2,5 % Health – Pharmaceutical 12 % Media 4,5 % Tourism – Hospitality – Travel Distribution – Commerce 3 %Transport – Logistics 8 %Industry 19 %Services (to individuals businesses) 4 %Other (BTP, Real Estate, High Tech Consumer, etc.) In what sector do you belong? 1 single category representing your activity What industry is your enterprise a part of? 14 % CEO or Comex Member 4 % Supply Chain/Purchase – Real Estate – Production/Quality – Finance 32 % 30 % Digital - Data digital - Innovation Marketing – Communication 10 %Information Systems 4 %Sales 6 %Other (HR, Strategy, Transverse Processes, etc.) 4. Source: World Bank 5. Source: Ministry of Economy (economie.gouv.fr) 12 Introduction
  13. 13. The results, showcased throughout this Referential, most often confirm the views shared by key decision makers who were personally interviewed. This reaffirms the idea that the digital has left its silo. The level of maturity between sectors remains varied, but within each organi- zation, the process is in progress. Like the qualitative study, the online study highlights large groups. Note that medium size companies, who do figure exceptionally in the panel, are most often digital companies. Respondents received questions specific to their profile, even if some questions were deliberately addressed to all the participants to discover congruencies or opposing perspectives. What is the total number of employees in your enterprise or group? 19 % 2,001 to 10,000 employees 12 % 501 to 2,000 employees 19 % less than 500 employees 12 %10,001 to 30,000 employees 38 %more than 30,000 employees 13 Introduction
  14. 14. CHAP- TER 1 14
  15. 15. CHAPTER 1 : CUSTOMER CENTRICITY : CUSTOMER DEMAND SHAPES THE VALUE CHAIN PG. 14 1.1. Customer participation in product design conception pg. 20 1.2. Feedback culture pg. 23 1.3. Relationships that are simplified and personalized pg. 26 1.3.1. Simplicity structures the offer and direction pg. 26 1.3.2. Personalization is key and difficult to execute pg. 32 1.4. Operations and support functions structured by demand pg. 35 1.4.1. Tools and men pg. 35 1.4.2. Processes reoriented according to customer experience pg. 38 1 15
  16. 16. Customer centricity has grown considerably with the arrival of CRM 10 years ago. The concept: is there a marketing approach that addresses both sales and customer relations? This has become the focus for the transformation of companies and a vital issue for any organization looking to best benefit from the digital revolution. 1. CUSTOMER CENTRICITY : CUSTOMER DEMAND SHAPES THE VALUE CHAIN 16
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  18. 18. 18 Customer centricity : customer demand shapes the value chain1 1. CUSTOMER CENTRICITY : CUSTOMER DEMAND SHAPES THE VALUE CHAIN New consumer behaviors, access to information and in- novative business models, have given power to the cus- tomer. Customer behavior has evolved with the new use of technology. Companies are forced to answer to the customer’s demands and volatility. The customer is king and his or her demand influences the structure of a com- pany’s entire value chain. The growth of customer centricity makes good commer- cial sense. Good sense that demonstrates an ideal wor- ld permeating all the segments of the value chain, from product conception to services, all the way to after sales service. However, companies understand quickly that this is a difficult objective to accomplish when faced with the reality of the market or its internal organization. The interviews conducted for this referential support that methods, processes and tools exist to achieve this objective. A number of example initiatives are presented in this chapter with often spectacular results. However, the key is perhaps elsewhere. What is most noticeable in customer centric companies is their spirit. They have a shared ambition focused on the customer and end-user, thus discovering the virtues of working together. An underlying certainty: above all else, it is the company culture that dictates the willin- gness to participate in the digital revolution. A more in depth analysis reveals a pattern of characte- ristics and processes. The first is the habit of integrating the customer and end-user during the first phase of pro- duct conception, a process that can be accredited to the method of design thinking. The second pertains to the culture – and the method – favoring feedback. Feedback is necessary to truly grasp customer needs. The third reveals a permanent effort to integrate simplicity and personalization with customer relations. These characte- ristics are equally supported by the constant evolution of support functions and operations.
  19. 19. 19 Customer centricity : customer demand shapes the value chain 1 Customer centricity : Summary Reinventing the customer experience to fit with the processes Concept • Customer centricity is based on two axes both technical and cultural: - An overhaul of the organization to homogenize the internal structures for the customer experience - Direct implication (feedback) and indirect (data exploitation) • There are a number of challenges: availability of analytical tools, internal competencies, company vision and an unfit company culture. Tools and technical competencies • A customer centric approach means understanding the customer but only 40% of companies have a tool for collecting data and providing a 360˚ vision of the customer. • Satisfaction varies according to the industry: 27% of consumer goods companies measure satisfaction throughout customer experience compared to 72% in tourism. • This data allows for target marketing (precise advertising) that once adopted has a high success rate (a positive return of 73%) despite being difficult to implement for certain companies. • The success of chatbots is mixed (a positive return of 32%). They require a considerable investment for service that is not always sufficient. • The development of adblocks does not worry companies (33% aren’t opposed) as there are ways to navigate around the adblocks and other available channels of communication. Communication • 65% of companies confirm the development of omnichannels, the use of a mixed marketing approach, both online and offline will continue in the medium term. • 73% of companies do not foresee abandoning the distribution of their product by the e-commerce pure players. • They therefore continue to prioritize their own platform as well as distribution and communication.
  20. 20. 20 Customer centricity : customer demand shapes the value chain1 1.1. CUSTOMER PARTICIPATION IN PRODUCT DESIGN CONCEPTION THE CUSTOMER IS INVOLVED FROM THE START OF THE PROCESS Co-construction, co-design, association, the terms vary but the intention is the same for companies who have chosen to have their customers and end-users actively participate in the conception of their products and ser- vices. The process is still too infrequently adopted des- pite the undeniable positive results, the first being a gua- ranteed opportunity for companies to test their ideas, prototypes and succeed in meeting the expectations of the end-user and the market. Another indirect benefit is the impact on customer loyalty. How to decipher, if the product is more efficient and thus attractive because customers themselves participated in its creation, or the brands are simply valued by association? Erwan Gaultier, EMEA Director of Digital Channels Customer Experience and founder of the Orange French Lab, has developed a formal approach: after the prototype phase the customer’s reactions are qui- ckly measured in-vivo to best consider its implication for the evolution of either the product or service. “The whole team is in contact with the end-user – customers or employees – it is sometimes even ethnology that is needed to understand the unspeakable!” Mr. Gaultier welcomes the results: “Future offers are already being built incorporating these processes. The service actually corresponds to the expectations and their satisfaction is greatly improved.” Without going as far as associating clients to the process of innovation, Christophe Verley, Digital Chief Officer d’ADEO (Parent company of Leroy Merlin), confirms interest for the process and is taking steps towards incorporating it in the group: “what’s important is to stay connected to the customer with regards to everything we design. Some of our BUs have interesting approaches: in Brazil one of our UX designers spends time at the end of a store aisle to observe product progress and collect customer feedback”. Organizing a hackathon can be a great way to launch, advises Pierre Gauthier, the Digital Director and CIO at MACIF: “The participants of our first hackathon had to test their ideas in the street directly with the end-user”. The success of the project, which won a jury prize, gave Mr. Gauthier confidence for the next step: a hundred col- laborators are already working on its development. What is “Customer centricity”? (by function) 31% Structure internal processes to optimize customer experience Systemize Customer feedback at every point of contact to better their offer Involve their customers in innovative process Use customer data to personalize their product offer Use customer data to better target marketing and advertising campaigns 42% 44% Digital Marketing/Communication Information Systems 21% 22% 27% 26% 15% 9% 8% 13% 16% 14% 8% 5% 20
  21. 21. 21 Customer centricity : customer demand shapes the value chain 1 THE CHALLENGES OF REGULATED SECTORS Having customers is new for certain organizations, notably former public companies that have since been integrated into markets but are still invested in public services. This is the case for GRTgaz, created in 2005, to take over Gaz de France’s operations. Herve Constant pilots the CIO since 2011, his first major project after the information system separation with Engie was dedi- cated to end-users: “B2C and client relations are the digi- tal motor. However, we are evolving in a regulated B2B environment: so we were initially missing the necessary motivation to launch”. Having an HR and operations background Mr. Constant quickly realized the client and end-user were absent from CIO: “We often talked about the technical subject, finances, but rarely of the end-user. IT is composed of 3, those who build, the trade and managers who request the product but in the end are not using it, the end-user is at the end of the chain.” How in effect do we succeed in oriented ourselves towards the end-user if they are not a part of our conversations? A situation that is luckily evolving thanks to the development of digital and design thinking personnel who are holding a more important position within organizations. Do you foresee stopping offline marketing to only do personalized online marketing in the next 3 years? Somewhat agree Strongly disagree Somewhat disagreeCompletely NSP 22% 44% 33%Transport – Logistics 9% 45% 45%Tourism – Hospitality – Travel 50% 33% 17%Fast- moving consumer goods 32% 37% 16% 16%Telecom – Utilities 33% 33% 33%Health – Pharmacy 50% 30% 20%Media 5% 37% 45% 3Other 14% 25% 36% 19% 6%Banking – Finance – Insurance 4 32% 44% 16% 4Distribution – Commerce 6% 6% 56% 25% 6%Industry 20% 80%Luxury 21
  22. 22. 22 Customer centricity : customer demand shapes the value chain1 For 47% of respondents The culture of your business is not aligned to the needs of your customers. In response to the question   “What are the challenges that slow the incorporation of a customer centric organization?” Arnaud Pelletier IBM Studios Director, Paris Studio approaches and design thinking «  IBM Studios Paris welcomes customers since 2014 to workshops and co-creation centers focused on the end-user experience, in order to be able to imagine, realize and value their digital initiatives. We transform the innovative ideas into industrial solutions, where the value added is confirmed by the end-user since the first stages of the project thanks to prototyping. The methodology of IBM Design Thinking allows us to move from idea to concept with agility, then from concept to integrated solutions deployed in compa- nies by multidisciplinary team members (designers, consultants, developers, architects). “The French Tennis Federation (FFT) is strongly focused on our fans for the Roland Garros tournament. For 2 days, we used the methodology of design thinking to analyze customer experience and the expertise of IBM international in the sports domain. “The design thinking workshop is by far the most conclusive I have done!” said Mathieu Gras, Director of Data and Client Experience FFT. The studio’s capacity for creativity and innovation can be combined with acceleration assets at IBM such as the International Center of Trade and Solutions (a 600 square meter showroom dedicated to industry solutions) or the Scale Zone which offers the ability to incorporate startup service tools in our clients’ pro- jects.”  IBM Focus
  23. 23. 23 Customer centricity : customer demand shapes the value chain 1 The consumer centric company must cast wide to not exclude any clients or customers. “But there is also the challenge of finding the best service quickly, to test qui- ckly and change quickly” says Matthieu Tanguy, Chief Digital Marketing Officer of Direct Energie. Especially since speed creates a competitive advantage, confirms Paolo Rovere, VP of Strategic Marketing at SEB Group: “Fast customer feedback allows us to differentiate oursel- ves from our competitors” as the customers are immedia- tely taken into consideration and are subject of continuous improvement. 1.2. THE FEEDBACK CULTURE An organizations capability of responding to clients and end-users largely depends on their ability to receive fee- dback and its analysis. It is even the only way to become customer centric according to Thierry Chrin, Chief Tech- nical Officer at Clarins “All products must be proofed by customers”. The cosmetic specialist has thus initiated new projects, like the launch of a customer loyalty program that is particularly generous reinforcing customer ratings and review. “We have made an effort to receive positive feedback from our customers”, says Thierry Chrin “The simple act of launching a questionnaire is not enough.” Mr. Chrin’s team has gone as far developing new sales approaches for the Clarins website so that it becomes the product point of reference for the brand. Following the same logic BUT International is launching a system to measure customer experience both in-store and online. “Like many retailers our sales are good, but we don’t take care of our customers enough”, says, Thierry Lernon, Chief Digital Officer, responsible for BUT’s international e-commerce. Mr. Lernon states: “it is an exercise that requires constant questioning of customers and audit of all the points of contact.” It should not become invasive. The measure of rates of satisfaction vary greatly depending on the industry   27% of companies Measure of satisfaction all along customer experience In mass consumer goods Versus 72% in Tourism
  24. 24. 24 Customer centricity : customer demand shapes the value chain1 DIRECT COMMUNICATION AND THROUGH COMMUNITIES Certain companies have a history of engaging with cus- tomers and receiving feedback. This is the case for Club Méditerrannée for example, who has always given its cus- tomers a voice via “GM feedbacks”. “This seems incredible today but we have a 40% response rate for our print ques- tionnaires who have more than 100 questions! These ques- tionnaires have always helped us to better our services at our resorts” states Quentin Briard, VP of Marketing for the FBS(1) zone at Club Méditerrannée. The time for long paper questionnaires is gone but the culture remains. “These questionnaires are digitized today and communicated in synergy with TripAdvisor, however it is no longer sufficient: a conversation must also take place between the customers, for the very reason we have created a help community on our site clubmed.fr” The tour operator has thus ‘recruited’ representatives in his com- munity who are in charge of responding to all types of questions concerning the villages and experience at Club Méditerrannée. Quentin Briard is happy with the results: “the enthusiasm is strong, with several thousand ques- tions posted after a few months with an average of 3 res- ponses per question”. Similarly, The Compte-Nickel community was created spontaneously on social media responding directly to questions asked by the public about Facebook. “We have taken the subject and organized a chat between our clients and the public. We have asked the most enthusias- tic to animate the communities and answer to the public. 1,200 out of 5,000 have accepted” states Hugues Le Bret, co-founder of Compte-Nickel. Yes, only on digital channels No, we haven’t planned to do so No, but we willYes, on all channels Fast Moving Consumer Goods 18% 9% 64% 9% 19% 13% 38% 31%Industry 40% 50% 10%Media 24% 20% 36% 20%Distribution – Commerce 27% 22% 46% 5%Banking – Finance – Insurance 47% 26% 16% 11%Telecom – Utilities 45% 36% 9% 9%Tourism – Hospitality – Travel Other 25% 18% 29% 27% Note: 184 respondents, small sample for the luxury (5), health (3) and transport (9) sector. Do you measure customer satisfaction in real time and throughout the entire customer experience? 01 - France, Benelux, Suisse
  25. 25. 25 Customer centricity : customer demand shapes the value chain 1 A KEY TO WIN AGILITY Customer feedback allows for better products and ser- vices, but it is also a key for improving agility and com- pany self-improvement. “From the beginning the team organizes itself to obtain end-user feedback, customers or employees, qualitative or quantitative” says Erwann Gaultier, Head of the Digital Transformation Program and founder of the Digital Factory at Orange. Mr. Gaul- tier states “there are two challenges: the ability to mea- sure time and the ability to accept risk – chance? to throw away a first version to readjust the product if necessary. We are at the heart of continuous improvement”. The two challenges are possible for organizations but it means committing to being between both states at all times and risk profit. “SOCIAL” LISTENING TO ANTICIPATE SUCCESSES Some brands are more adept than others when it comes to the ability to listen: the love relationship they have with their fans and the constant demand of new products can facilitate their capability. This is the case for Disney, for example, who put this advantage to use to anticipate the success of a franchise or product. “We have the chance that the Disney brand is a “love brand” and we have the chance that for each of our 3 brands (Disney, Marvel and Star Wars) we have a very strong relationship with our communities, who are highly engaged and in demand of our content, products and experiences”, says Jérôme Le Grand, who pilots the commercial and distribution licenses at The Walt Disney Company France. “They bring an amazing sounding box to our diffusion and content and are equally a great barometer when it comes to our products, whether it is to measure the potential success or anticipate novelties. Social listening allows us to be connected and listen to the social networks”. This can equally provide an amazing opportunity to achieve the next step: direct engagement, being able to engage in conversation, like for example using a conversational agent. « All products must be proofed by customers » Thierry Chrin, Chief Technical Officer, Clarins
  26. 26. 26 Customer centricity : customer demand shapes the value chain1 Companies however still have a long way to go. The complexity they face is shifting and has multiple facets: sometime technological, cultural, organizational, or even strategic and above all else “human” with the famous “but we have always done it this way!” the complexity pro- gresses with the customer. A DIFFERENTIATING VECTOR Shifting to the birth of Uber and its integration into the market of urban mobility, Raphael Morel, Director of Development for France insists on the importance of standing out amongst the actors and systems in place “What’s most important for us is to supply innovation to a traditional sector. We did not invent the possibility of reserving a chauffeur from a distance: we have rendered 1.3. RELATIONSHIPS THAT ARE SIMPLIFIED AND PERSONALIZED 1.3.1. Simplicity structures the offer and direction implicity is the solution to complexity. This apho- rism by Constantin Brancusi summarizes the challenge faced by the key decision makers we met for the making of this Referential. Simplicity is made the priority and is applied before anything else to be able to liberate the customer who for too long had to bend to the ‘processes’. You don’t have a common definition of customer centricity within your company The law on data usage prohibits you from accessing your customer’s preferences Your organization is focused on sales before the customer Your company culture is not aligned around client needs You are missing the proper tools and key technological platforms in order to manage data Your expertise is insufficient for data analysis Fast Moving Consumer Goods Industry Telecom – Utilities Transport – logistics Banking – Finance – Insurance Tourism – Hospitality – Travel Media Distribution – Commerce Health – Pharmaceuticals Luxury 30% 24% 15% 23% 25% 14% 17% 14% 11% 28% 28% 17% 11% 17% 17% 28% 33% 11% 26% 23% 9% 11% 17% 17% 33% 17% 17% 27% 5% 32% 23% 25% 8% 8% 25% 8% 20% 20% 6% 20% 11% 13% 27% 3 23% 18% 12% 27% 15% 21% 11% 17% 7% 25% 11% Note: 186 respondents, small sample for luxury (5), health (3) and transport (9) sectors What challenges delay the incorporation of a customer centric organization? S
  27. 27. 27 Customer centricity : customer demand shapes the value chain 1 the process more fluid, simple and enjoyable above all else” The customer and chauffeur are thus both passen- gers of the VTC (chauffeured tourism vehicle) have ‘chosen’ to use the panel as solution and who express their own requirements. An approach that has become the standard for all other industries. “Client experience is essential. Our clients are used to Uber, and we need to be able to offer them this experience”, says David Kownator, founder of the pure player of parking OPnGO. “Thanks to our application the driver doesn’t need to go to a parking meter in order to pay. And the integrated remote control allows access to private car parks, such as those of Accor Group for exa- mple”. Philippe Nobile Director From e-commerce to commerce E-commerce represents 10 to 30% of consumer good sales, all markets included. Exceptions in- clude the luxury market that is explained for by a limited product offering and thus does not pro- mote direct e-commerce, and thus has allowed for the emergence of important multi-brand portals with varying economic models, such as Net-A- Porter, vente-privee.com and Farfetch. Despite all that is available on e-commerce we are still in an era of emancipation, with an online ex- perience that is globally poor: little inspirational content, staggered information flows, incomplete client reviews, display bugs. This also applies to those who have graduated the first stage of matu- rity such as Amazon. The online experience for the e-commerce giant is a sales catalogue with pages showcasing a dozen two dimensional photos. It is one of the reasons luxury brands have hesitated when it comes to e-commerce, because as it stands, the experience does not reflect the complex and rich sale that is specific to the sector. This will change on one hand due to the growing maturity of the key players in e-commerce. Their maturity will significantly reduce anomalies of the online experience. On the other hand new technologies will enrich the experience, rende- ring it state of the art: with better integration of sales offline and online - For example with the use of bots to personalize and humanize the e-commerce experience - The use of enhanced content (dynamic photos, videos, social) backed by management of emotio- nal data. Online merchandising will then develop. E-com- merce is only at its beginning. Let’s hope it evol- ves quickly and will challenge in-store commerce.  An expert’s opinion BCG
  28. 28. 28 Customer centricity : customer demand shapes the value chain1 A DIRECT IMPACT ON THE DIGITAL TRANSFORMATION OF THE COMPANY Simplicity is labeled as a priority by Thomas Saunier, Mana- ging Director of Malakoff Médéric. One of the priorities in Mr. Saunier’s transformation plan is to place humans at the heart of the project – customers and collaborators included. “We have a really propensity for complicating our lives and thus those of our customers, notably when it comes to contracts. This is why we wish to offer services that are simple”. This priority is also shared by Emmanuel Saudeau-Turlotte, who joined the executive committee of d’AG2R in 2017 as Digital, Marketing, Client Relations and Communications Director. “Digital is very demanding for insurance com- panies. It forces us to be clearer about guarantees and to provide simulations for example.” The challenge is indeed to allow the customer to project instantaneously and in all transparency when subscribing to technical products, wit- hout forgetting the option to compare offers which over the years had been intentionally limited! HOW TO GET RID OF BASIC IRRITANTS Defining himself as an evangelist Chief Digital Officer, Christophe Verley travels the globe in search of innova- tions to advance the transformation of the group ADEO, of which Leroy Merlin is the flagship. “We regularly tra- vel internationally for inspiration. We have seen incre- dible concepts in the United Sates. However, they cor- respond to a long term vision”. It is difficult to project without starting the process of simplification. “One of our major challenges is to remove all the basic irritants: individual customer usernames, the continuity of pro- jects online and in store, price consistency on all chan- nels...etc.” Only then can we envision more innovative projects built on a single foundation centered uniquely on the customer. Design thinking methods have proven successful in improving customer experience. At GRTgaz, Hervé Constant reveals having put himself in the shoes of a business unit head to understand his day: “For example we put ourselves in the shoes of a business unit head to understand his day. We observed that he used a large number of processes, at times redundant in the same day for different tasks. We asked ourselves how can we sim- plify his life and have worked on finding a solution that will soon come to light: this is also how we regain cus- tomer confidence”. In effect, taking into consideration the user’s needs often has a quicker and more positive impact on the final customer. Erick Bourriot, Director of Connected Commerce for the Beaumanoir Group, focuses his efforts on the omnichan- nel exchange. “The client who purchases online and wishes to exchange their product in store has be reim- bursed and then purchase again: the operation is not seamless”, providing a streamlined buying experience is a challenge but the client’s satisfaction and loyalty is worth the effort.
  29. 29. 29 Customer centricity : customer demand shapes the value chain 1 STANDARDIZATION, A GIFT OF SIMPLICITY FOR BOTH THE COMPANY AND CUSTOMER The customer centric approach implies being able to provide a customized solution for each customer. Digi- tal renders this easier and with decreasing costs. “Tech- nology allows us to propose more complex solutions but solutions that correspond exactly to the customer”, says Alain Staron, Senior VP of Digital at Veolia. This simplicity benefits both the customer and the sup- plier. Veolia has always proposed tailored solutions but at a very high cost. “In the 2000s we began to offer the same solution to everyone which was not suitable either. Now the products are increasingly sophisticated and allow from the same frame for customers to customize solutions for every need. It is the beauty of digital!” SATISFACTION BEFORE CUSTOMER EXPERIENCE The complexity faced by leaders of digital is real. In the past few months Engie has focused a considerable amount of effort in order to release three innovative offers, com- bining consulting, consummation optimization and an advanced form of data personalization. The efforts applied do not prevent Augustin Honorat, leader of the DMPA (Market director of individuals) and Marketing Director of BU France Individuals to return to the fundamentals of commerce: “help them reduce their bills for the same comfort or better” – a virtuous strategy that creates cus- tomer loyalty, strengthening the position of Engie in the market at the price of client margin. This will be improved by a better use of data (additional sales for example) and a reduction in costs – due to more efficient sharing of infor- mation between services. Yes on all channels No, but we will be Yes, on all digital channels No, and it is not planned 27% 21% 35% 17% Note: 184 respondents Do you measure satisfaction throughout the client experience? Interest in measuring satisfaction by sector: • Tourism: 72% positive opinion (Digital and omnichannel combined) • Mass consumerism: 27% positive opinion (Digital and omnichannel combined) Personalized content is not yet the norm with a clear preference for generalized content (website, network, social media) • Social media nonetheless permits companies to organize their client base and obtain an after sales service without any associated costs
  30. 30. 30 Customer centricity : customer demand shapes the value chain1 On the other hand, in an equally competitive environment Uber has two obsessions: passenger satisfaction, and also its drivers, especially in their ability to generate turnover because they are the key player in the value chain. “Like passengers, drivers also have their application on their smartphone which allows them to be in contact with the passengers”, said Raphaël Morel, Director of Develop- ment of Uber in France. Mr. More adds “we are working nonstop to improve the driver experience on our appli- cation”. For example the improvements allow them to be paid immediately (and no longer weekly) to optimize their cash flow. They also have the option to activate an option that allows them to only take fares that bring them closer to their home at the end of the day. As well, Uber offers “access to an expert advisory team to accompany drivers in the piloting of their business” among other services. Retaining drivers is as important as passenger loyalty. EXCELLENCE IS THE STANDARD Accustomed to experiences that are increasingly seamless and simple, customers have developed high standards. The slightest glitch in purchasing, an applica- tion that doesn’t fulfill its promises and it’s over for the disappointed client often indefinitely. Realize the nega- tive impact this can have on social media for a “brand’s image”. There is no lack of solicitations and buying opportunities making it easy for the customer to drop a faulty brand or service even if they have been covered by adblocks. The SEB group is working diligently on the connecti- vity of their products and on the development of asso- ciated services. “We took a turn to focus on connected products many years ago. We understood the advantage for the customer: connectivity allows for more possibi- lity, updates, all impossible with a book”, explains Paolo Starbucks Olivier de Mendez Managing Director, France Rewarding client loyalty in an international context Our loyalty program is based on the frequency of cus- tomer visits, when it would be more efficient if it was a mix of frequency and dollars spent in order to be able to reward both types of buying habits and not only one or the other. Shopping habits in France are different than those of the United Kingdom or the United States, where customers go to Starbucks every day (only) to pick up their coffee. It is the customer who decides whether he is loyal to the brand. Rarely is this understood. Brands often see loyalty as a trickledown effect: the customer is loyal because he visits our store every day or because he spends a certain regular sum. However, the customer who buys his espresso every day is as important for Starbucks as the customer who visits the store once a week but spends 40 Euros. Both deserve to be rewarded because they are loyal to the brand in their own way. Few brands are successful and I would like to see more work done on the subject to find the best way to reward our loyal clients. This will require a lot of technological improvements to create an added value that will have to be presented to the United States.  Interview
  31. 31. 31 Customer centricity : customer demand shapes the value chain 1 Rovere, Vice President of Marketing for the SEB group. Companions, connected cooking robots are customer centric by nature “the relationship created with the cus- tomer is very important: it allows us to be in the posi- tion of the coach who guides the end-user step by step to create his own increasingly complex recipes.” These robots are often gifted for Christmas or birthdays which obliges the SEB team to be irreproachable. A gift that doesn’t deliver on all its promises has all the chance of ending up in the back of the cupboard. “We have to be irreproachable in what we offer: in the execution, the pro- duct connectivity, the upload of the application, and its 24/24 availability at the snap of a finger, even on Christ- mas, all of these options are imperative”, says Paolo Rovere. A positioning that is compatible with the step toward agility undertaken by the group, where recipes and services are constantly being improved. Evidently the same is applied to applications or further- more the bots. Interviewed on the best usage of the latter, Laurent Solly warns: “bots are exceptionally powerful if they respond to a customer need and the public demands are high. The expected standards are of great quality and the end-users expect a solution to the question asked.” The General Director of Facebook for France Sou- thern Europe underlines the absolute necessity to be able to provide a service that at least matches customer expectations. Without this the relationship is at risk. WHEN SERVICE CONTINUITY TRUMPS INNOVATION Companies of strategic industries and vital infrastruc- ture are actively working on bettering their services and optimizing their business models. They don’t however forget their priorities which are security and service continuity. A railway manager concerned for his/or her passengers will focus on maintenance and punctuality rather than the exploitation of passenger data. “The director of inno- vation for the London Underground takes the opposite stance compared to the entire buzz around new business models” says Ouahcene Ourahmoune, Director of Inno- vation and Business Development of Alstom in the UK. “According to him, there is no money to be earned in NSP Strongly disagree Somewhat disagree Somewhat agree Definitely agree 4% 0 10 20 30 40 50 16% 40% 33% 7% Industry Tourism – Hospitality – Travel Average of all sectors Note: 184 respondents Does your group centralize internal and external data to have a 360 vision of the customer?
  32. 32. 32 Customer centricity : customer demand shapes the value chain1 developing new services. He already knows his customer and his goal is not to exploit personal data, it is to main- tain the day to day function of his network. In other words, technology should simply allow for a better functioning tube.” In effect in this context running after connected objects will allow him to better service for passengers who are always ready to share their disgruntlement on social media and taint a brand’s image. 1.3.2. Personalization is key and difficult to execute ersonalization is a real challenge for marketing teams. It offers inconsistent results, which is just as much to do with project piloting as tech- nological limitations. The marketing teams of Beaumanoir have just created a Data Management Platform DMP and different news- letters for each of their brands. The project had been in the works for a long time. “The number of clicks and page openings are already better!” says Erick Bourriot, Director of Connected Commerce at Beaumanoir. “We need to learn to disassociate ourselves from the life of the product to be able to grow closer to the life of the cus- tomer.” This objective is just as hard to achieve as is the difficulty of gathering information on customers in store rather than online. “We aren’t exploiting all the possible opportunities at the cash register” regrets Erick Bour- riot, who has high expectations for the recently launched loyalty program. The challenge for sales teams is the ability to combine personalization and their omnichannel strategy. “We need to improve our ability to welcome customers to digital as it is the case in the UK where cash registered are dedicated to online purchases.” Well executed perso- nalization happens with the first point of contact, via a newsletter for example, all the way to the act of exchange or store visit. Erick Bourriot hopes this will force sales teams to get rid of any remaining monochannel proce- dures. Customer centricity relies on customer comprehension, but only 40% of companies are equipped to centralize data allowing for a 360 vision of the customer. Company ability is still partial and difficult when it comes to implementing a 360 vision The integration of tools and solutions permitting a 360 vision is not universally adopted (40% of companies are taking this direction) This trend varies greatly between sectors: • Heavy industry (12% in agreement) and telecom (32% in agreement) are behind • In comparison, the tourism industry and fast consumer goods have respectively 55% and 45% positive feedback. The difficulty to integrate a global system is a challenge for large groups. P
  33. 33. 33 Customer centricity : customer demand shapes the value chain 1 To contextualize is also to understand the customer environment and product usage. “It isn’t only necessary to better understand past customer processes, but also to consider that the portfolio of solutions is vaster than our product offer”, says Pascal Brosset, SVP of Strategy Global Solution CTO at Schneider Electric. He warns: “the same product, a break for example, can be used a variety of different ways across different industries.” Mr. Brosset believes after two years this understanding is well incorporated in the company. HANDLED A TO Z The Engie teams have applied a mix of digital and physi- cal products to personalize their new offers, notably for MyPower. Photovoltaic panels are installed on customer roofs. “For this offer, digital allows us to offer our clients concrete piloting solutions and to render the actors of transition energetic” analyzes Augustin Honorat, who pilots marketing for individuals in the French market. Replaced by: “MyPower, this offer is the ‘key in hand’ for installing photovoltaic panels on individual’s home roofs, allowing customers to auto-consume self-gene- rated energy with a return on investment of 10 years. We handle everything from A to Z: the conception, adminis- trative steps, the installation (in one day), the after sales service, the long term guarantees of material, etc.” A HISTORY OF CONTEXT Aside from a customer’s knowledge, the time of contact is essential for contextualizing the offer or discourse. “Our goal is to guarantee “moments of life” for our customers”, says Pierre Gauthier, CIO for MAIF “which implies being able to source the right information, at the right moment, to the right person”. Raising relationship inten- sity is no longer necessary in order to sell more contracts but rather to predict the moments where the customer is more susceptible and needing guidance. Data is key, “just as much as contextualizing the offer is for an advi- ser”, says Pierre Gauthier. « I want my 360 customer base to coincide with that of my suppliers: it is out of the question to have to rebuild everything » Jean-Christophe Lalanne, CIO of Air France
  34. 34. 34 Customer centricity : customer demand shapes the value chain1 THE LIMITS OF PERSONNALIZATION When Odile Szabo arrived at Vestiaire Collective after being with Ratuken in 2016, she brought with her a strong personalization culture. “When I arrived almost nothing was personalized”, said Mrs. Szabo, “We did a number of tests in the aim of putting in place unique definitions by client type, and identify the 5% of clients that generate 50% of our revenue.” But the world of fashion has its own rules, and the new Director of Marketing understood the importance of not boxing customers into categories. “We are here to inspire, it is important not to show the same things to our audience,” Mrs. Szabo explains. Re-targe- ting is a complex exercise in the fashion industry: “Two similar coats, one in leather and the other in wool, have nothing to do with one another in the eye of the cus- tomer.” Everything depends on the context, the personal environment and the profession of the customer, of their hobbies and of course personal tastes without forgetting the fashion trends. Completely Somewhat agree Somewhat disagree Strongly disagree NSP 2% 33% 31% 7% 29% Note: 183 respondents Do adblocks limit the reach of your digital advertising? Adblocks are perceived as a barrier, but remain manageable Not all sectors are concerned by adblocks who have a greater impact on B2C than B2B For the professionals who are impacted the market is divided over adblocks: • Adblocks are a barrier for online marketing • However they are manageable by marketing via other channels « Adblocking is one of our main challenges. Our primary response is to present content differently, so that it is accepted by our audience without being seen as publicity. A well-executed email remains efficient and more successful than an automated campaign » Guillaume Du Gardier, Digital Director of Ferrero
  35. 35. 35 Customer centricity : customer demand shapes the value chain 1 1.4. OPERATIONS AND SUPPORT FUNCTIONS STRUCTURED BY DEMAND 1.4.1. Tools and men ow do we recognize the right tools? Edouard Sauvage, Managing Director of GRDF, shares a first thought: “The step towards digital is in part a collective appropriation: it involves rendering digital commonplace and making it so everyone is familiar.” says Mr. Sauvage, evoking examples of Yammer, which the company launched in 2016 and celebrates an enga- gement rate of 85% by its collaborators, as well, as from external networks like Twitter and Facebook, where it is possible for collaborators to exchange freely to stren- gthen and highlight the company traits. In effect it seems inconceivable for a user to have to manage tools “from a different era” when there are touch screens and social networks available at all hours in our private lives and their use is intuitive. The priority is impact for Emmanuelle Saudeau-Turlotte, who has just joined AG2R La Mondiale. “We are rather agnostic when it comes to technology. We should inte- grate them with a single question in mind: how can it change the life of our customer, our partners, or colla- borators?” The new digital director of the leading social protection group in France doesn’t start from zero in its digital acceleration mission. “15% of health contracts are already initiated online, there is standard form and one which is dynamic, and aptitudes are organized by teams. We first need to allow customers to understand, compare and anticipate challenges that largely surpass interfaces or creating a new mobile application and push the teams to work on marketing and offer technique.” You are missing the key technological tools and platforms to manage the data 48% The culture of your company is not aligned to customer needs 47% Your organization’s is sales before the client 45% You don’t have a consistent definition of customer centricity in your company 38% Your expertise is insufficient for data analysis 33% The laws on the use of personal data prohibits you from have access to your customers’ preferences 9% Note: 186 respondents What are the challenges slowing down the implementation of a customer centric organization? « B2C and client relations are the digital motor. However, we are evolving in a regulated B2B environment: so we were initially missing the necessary motivation to launch. » Hervé Constant, CIO GRT Gaz H
  36. 36. 36 Customer centricity : customer demand shapes the value chain1 THE BEST TOOL GENERATES THE DESIRE TO EXECUTE, AS LONG AS THE PROPER TRAINING IS IN PLACE The large majority of those interviewed for this Referen- tial agree on the effort that is necessary for technological training, especially for sales. “We can tell that it is abso- lutely necessary for the sales team to be trained on the tools in order for them to be useful” says Erick Bouriot, Director of Connected Commerce for Beaumanoir. “If you limit yourself to only providing the tablet instruc- tion manual to your sales force, you can be sure that it will end up at the bottom of the drawer.” It is even more possibly damaging as the tablets are dis- tributed in test stores holding a precious information like the catalogue, client buying history and the average purchase basket. “Digital and the tools must not replace the sales relationship,” says Erick Bourriot, putting at the chance of the customer finding satisfaction in staying behind their screen. This approach is shared by Jean-Christophe Lalanne, the CIO of Air France who has high expectations for a tool to be diffused on 5,000 tablets at Roissy and Orly (airports): “The tool is a motivator for work well done, but will the agents use it? This remains to be seen. The main challenge is to prove the use is valuable and that the tools are foremost at the service of the customer, not at the service of the agent” Mr. Lalanne underlines. The impact of the solution lies on the agents’ proper use. Air France’s relationship with customer interaction is in full transformation. The challenges met are a mix of two obstacles: • Technical: no tools, no data, no skills • Social Cultural: internal culture, customer legal external protection Depending on the sector the challenges are very different. • Such as, the legal aspect in the health sector is a problem for 33% of companies (versus the average 9%) Structure internal processes to optimize customer Systemize the customer feedback at every point of contact to better the offer Involve the customer in the innovation process Use customer data to personalize the product Use customer data to better target your marketing campaigns 29% 0 10 20 30 40 50 26% 22% 12% 11% Telecom – Utilities Average Fast Moving Consumer Goods Tourism – Hospitality – Travel Note: 185 respondents What defines being customer centric?
  37. 37. 37 Customer centricity : customer demand shapes the value chain 1 THE LIMITS TO TECHNOLOGICAL AUTONOMY For a long time the ADEO group gave each country tech- nological autonomy in order for them to be able to adapt to their local environments and be in accordance with the strong trends of DIY (Do It Yourself) – the heart of ADEO’s business. The approach is customer centric in the first sense of the term. “But this led to each entity having its own technology platform for online publishing and sales”, says Christophe Verley, the Chief Digital Officer for the group. The costs of digitalization and the threats related to new market entrants rendered this approach no longer possible. “The race to “arms” is too expensive and our business units saw the limitations to this autonomy that must now be expressed differently” says Christophe Verley. “We are now in a heavy but necessary mer- ging phase, with an agility challenge that is difficult to manage.” Between the one who wants to progress quickly alone and the one who wants to be surrounded: the ADEO group has included both approaches in the execution. Customer centricity relies on two parallel axes • An internal reorganization of data to transform the client experience • A shared workload with the customer (feedback, opinion, data exploitation) Customer centricity is interpreted differently depending on positions within the company: • Digital is focused on the customer experience • Marketing is focused on customer feedback « Customer centricity is a complicated and challenging work in progress. The issue is not digital, it’s before all else a company issue (…) with a strong commitment from me and my team to secure an online experience that is coherent with the offline experience. » Thierry Lernon, BUT International
  38. 38. 38 Customer centricity : customer demand shapes the value chain1 1.4.2. Processes reoriented according to customer experience eyond talent and tools the transformation process opens the possibility for companies to reorient themselves completely towards their end-users and customers. As long as they ask themselves the right questions: “Let’s not forget that digital is only one method, one method certainly…but a method. Ideas will always count!” says Fabien Le Pen, Strategy and Commercial Innovation Director at Bouygues Real Estate. “The real challenge in an improvement project of process that already exist is to understand are we really offering digitalinitsnewservicecapacity”,saysSéverin Cabannes, General Director of Société Générale. “What are the new services we will be able to offer? What type of use will inter- fere with what we already have?” Questions the bank has trouble answering, at fault of not liberating the creativity of their teams when it comes to data exploitation. One of the first projects led by Magali Noé after her nomi- nation as CDO of CNP Assurances in 2015 was to stren- gthen the client culture. “We first decided to focus on client experience and data, on tracing the experience and iden- tifying moments of friction” says Mrs. Noé. An approach that is shared across the group: Thierry Claudon, who is managing director of the CNP Group in Latin Ame- rica piloted the launch of Caixa Seguradora an insurance pure player in Brazil in 2016. Mr. Claudon believes it is a shame that large groups take on processes and tools before even establishing their company project. “Big data is a trap because it distances you from the tool. It allows you to know the client profile…so? You have to start by knowing where to find it, understand what he or she wants and what we are giving him or her!” reminds Mr. Claudon, confirming that what’s essential is not to know the customer, but rather to appreciate his or her experience in order to best service him or her. “Customers have told us how they wished the website would function and it is according to their needs that we built the platform. As well as, for the subscription of online automobile policies, customers have the capabi- lity to see what each guarantee costs. They can also pay in 12 separate payments. These are revolutionary changes for the market” says Thierry Claudon. The method works, launched in 2016, Caixa Seguradora sells already 10,000 policies a month, 20,000 next year and has become a major insurance player in Brazil. DO YOU HAVE TO START FROM ZERO? The evolution of processes can also bud from a redoing a company’s global functions. “It has been one year since we are digitalizing our sales force and client services simultaneously”, says Fabien Le Pen, Strategy and Com- mercial Innovation director for Bouygues Real Estate “We have launched ourselves into the digitalization of client experience from SAV to prospecting. Everything was taken from the beginning, from equipping to the sales approach on tablets, to the development of digital tools, like wall imagery, to the creation of web folders for customers.” Bouygues Real Estate is even pushing the reach of the initiative to the remodel of its physical stores, with the launch of a new concept: the “BI Store”. This evolution has direct repercussions on the method of product commercialization and introduces a new method of engaging with the customer. Digital transformation is not just a question of digital tools; it is before anything else a question of culture, particularly internal, as this requires all the ability of all the services to collaborate with one another and to learn from one another. B
  39. 39. 39 Customer centricity : customer demand shapes the value chain 1 example: “Attention your next objective is for the cus- tomer to visit Facebook”, says Jean-Christophe Lalanne. The potential for Air France is immense: here are its agents equipped with a tool of instant function that is supported by data allowing them to better complete their mission. The cultural and adaptation challenge are even more critical. “Employees will have to understand the tool and feel accompanied” warns Jean-Christophe Lalanne, “we will have to communicate precise objec- tives.” A NEW WAY OF INTERACTING There is a change in foundation analyzes Jean-Chris- tophe Lalanne, CIO of Air France “Historically agents applied a process that drove the customer to react the way we wanted him to react. This approach has evolved.” The company wants to focus on the customer to better understand and answer to their needs. The new method thus involves guiding the agent with regards to client interaction, via the tool on his or her tablet, he receives a suggestion “for the next best action” according to an orchestrated process by the company. “This could be for Gilles Fabre Partner Managing Director Redoing Customer Experience: the transformation’s moment of truth The new market entrants and the large unicorns of di- gital have established the new standard for customer experience, by making their success the key and their business model. The extensions of mobility, the revo- lution of customer usage and users have amplified this revolution by creating a new paradigm of customer ex- perience based on accessibility, fluidity, simplicity and transparence. This change in approach and customer expectations has started an irreversible wave of reinven- tion across all the sectors and industries for customer experience. Redoing customer experience is the catalyst for so- ciety’s digital transformation. In part it visibly mate- rializes for the customer, the new offers and services, the new methods of interaction, the new experiences and management processes have furnished a visible image of the transformation. However, the transformation of customer experience is also an internal transformation for all companies. Its establishment requires a stronger customer centricity, sourcing data to be able to better understand and capture customer attention, an open mindedness to identify ecosystems or accelerating tech- nology, multidisciplinary teams leveraging agility, and new ways to collaborate. Thus, putting in place this new approach requires ineluctable changes in the operatio- nal model and organization of each company for the new customer experience to transition from a prototype to an active function, at the heart of the business and as a real tool of differentiation. Redoing Customer Experience is the digital transforma- tion’s moment of truth.  Expert Opinion BCG
  40. 40. CHAP- TER 2 40
  41. 41. CHAPTER 2 : ARE ENTERPRISES HEADING TOWARDS BEING DATA- DRIVEN? PG. 40 2.1. A work in progress with varying degrees of advancement pg. 47 2.2. The first spectacular results pg. 51 2.2.1. Data: servicing client relations and personalization pg. 51 2.2.2. Security and maintenance: transitioning from reactive to proactive pg. 53 2.2.3. Data security, more vital than ever pg. 54 2.3. Data, an IT challenge! pg. 55 2.3.1. A solution for managing exponential volumes of data pg. 55 2.3.2. The advantages of a progressive approach: the BUT method pg. 56 2.4. We must go further pg. 57 2.4.1. Data collection is not sufficient; it must be correctly used pg. 57 2.4.2. Towards iteration pg. 57 2.4.3. The challenges of creativity and innovation are still very present pg. 58 2.4.4. Data in real time pg. 58 2.4.5. Data is useless unless correctly collected pg. 60 2.4. The urgency of solving issues of governance and data ownership pg. 61 2.5.1. The Chief Data Officer, here to stay? pg. 62 2.5.2. Personal data: elevated risk of sanctions pg. 63 2.5.3. Must data management be outsourced? pg. 66 2.5.4. Clarifying the question of property to finally allow for progression pg. 68 2 41
  42. 42. Important progress has been made since the turn of the century and the wave of big data: companies have entered a phase of acceleration and have oriented themselves towards incorporating data driven models for their activities. The step to action is pragmatic, with usage and thus good practices. The projects underway, even the most simple, already benefit from spectacular results and are a great example of a data-driven company’s potential. 2. ARE ENTERPRISES HEADING TOWARDS BEING DATA- DRIVEN? 42
  43. 43. 43
  44. 44. 44 Are enterprises heading towards being data- driven?2 2. ARE ENTERPRISES HEADING TOWARDS BEING DATA- DRIVEN? The companies who perform the best are those who underwent a radical transformation of their activities and acquired crucial competencies. The arrivals of new talents, combined with training efforts, have contributed to a general increase in competence. In a few years, these organizations have succeeded in evolving their pro- cesses and adopting new practices to surpass the usage stage and evolve into one of data-management. Few are able to make use of all the innovative possibi- lities data offers. A company’s transition from a classic organization to one piloted by data has no formal method. It demands developments linked to cultural change and the acquisition of new skills as well as executing organi- zational and technological projects. A data-driven com- pany is a well-defined target but still far from reach. Awareness is added to the imperative transformation: the exploitation of data will gain structural importance creating new challenges for managing executives. First, on the juridical level, with the enforcement of regulations on personal data, including the European Regulation on data protection that will be applied starting in 2018 and provide radical penalties for any breach. Secondly, strategically, due to customer’s increased transparency requirements, a vigilant approach to data exploitation is necessary creating a new dynamic to the customer centric company. « We have the tools, we have the capacity to calculate and we have the important volume of data, with which we still don’t know what to do » Erick Bourriot, Director of Connected Commerce Beaumanoir Group
  45. 45. 45 Are enterprises heading towards being data- driven? 2 Data-driven company : Summary Leverage the potential of data Customer perception of data • Using data is universal: 85% consider it normal to exploit customer data • However, the value of data varies widely depending on the function of the sectors: 65% of health companies would agree to pay for data compared to only 13% of companies in the luxury sector Technical skills and obstacles • Other than acquiring the technical skills needed to start exploiting data, the biggest step for companies to accomplish is their culture must become data-driven. • The emergence of open data: 82% of companies see open data as a strong and efficient method for innovation. 64% are ready to collaborate with external resources. • A new regulation starting in 2018: GDPR securing data. This regulation will change data usage. Banking and health sectors are the most concerned. (53% to 48% respectively hold a negative opinion) Valorizing data • 91% of companies have adopted a data value strategy or a new business model allowing for the added-value of customer data.
  46. 46. 46 Are enterprises heading towards being data- driven?2 Data-driven company Key Figures Data exploitation 86% of companies Regulation 53% of banking companies and 48% of health companies worry about the implications of the new GDPR norms Open data 82% of companies consider open data a great opportunity New business models 91% of companies adopt new business models in order to support data usage MAJOR PRIORITYMINOR PRIORITY Improve data quality 3.11 Incorporate tools for data processing and stocking 2.98 Develop an understanding of function and of the company’s data culture 3.05 Acquire knowledge related to data management 2.94 2 43 With regards to data, how do you organize your primary company priorities? (1: minor priority/4 major priority) Note: 535 respondents
  47. 47. 47 Are enterprises heading towards being data- driven? 2 2.1. A WORK IN PROGRESS WITH VARYING DEGREES OF ADVANCEMENT THE ERA OF DATA MANAGEMENT: A SOLID BEGINNING Announced with a bang in early 2010, the big data revo- lution finally made its first virtuous effects. The time for companies to fully be able to support the implications, to review their organization and to equip themselves with the solutions and technology that permit themselves today to realize the potential and to even exploit a certain amount! TheinterviewscarriedoutfortheReferentialrevealcontras- ting degrees of progress across different company projects. A number are still at the stage of choosing between which infrastructure and which tools to use. Others have initiated major reforms, redoing their foundation and utilizing the potential from the tools at their disposal. This is the case of Carrefour, for example, which has just finished a two year project. The distributor generates 3 million Euros of daily revenue and its customer loyalty program is comprised of 15 million active cardholders. In order to process the disag- gregated data, Carrefour has equipped itself with a data lake and a processing center, where DMP has been applied. “We now have an incredible ability for deciphering data”, rejoices Hervé Parizot, Executive Director of Carrefour e-commerce and Data Clients for France. This device allows the personnel to fully enter the era of data manage- ment, reinforced by the number of teams dedicated by the company to charter the use of data. “It must only be used to better understand and service the customer” says Hervé Parizot. Those who ran their projects well are already benefiting from the fruits of their effort. “We started from scratch 3 years ago,” recalls Thierry Lernon, General and Chief Digital Officer of BUT International. “And today more than 1.5% of revenue is generated from relationship marke- ting”. Mr. Lernon’s company made the radical choice to out- source the processing of its data, a relatively low cost solu- tion to a situation of colossal implication. “It was the right decision for us. The stakes are huge with 40 million visits a year to our stores and 1.5 billion Euros in revenue, with 50 million desktop and 20 million mobile visits!” An example that summarizes the general sentiment of the companies interviewed who overall feel they are starting to see the end of the tunnel: their infrastructure is finally in place, or will be, after years of development, and they are exiting long phases of data consolidation to finally be able to pass to a phase of data acceleration. COMPANIES GAIN PROFESSIONALISM The rise of skill in companies concerns all industry, observes Erwan Gaultier, EMEA General Director of Digital Channels Customer experience of Orange and founder of the Digital Factory to which IBM contributes: “All the actors, including the most advanced are still in the operational learning phase.” Acceleration is even fas- ter and data takes on a vital dimension for some, states François Gonczi, Digital Director of EDF. “The whole company is affected by data: marketing, web mobile teams, operations. Half of our employees work in a call center in France, 5,000 employees whose work involves anticipating customer calls, schedules, etc. which directly implies data.” Developments are thus a priority for Fran- çois Gonczi who is happy with the progress made over the
  48. 48. 48 Are enterprises heading towards being data- driven?2 last several months: “The integration and automation of customer activities is improving every day in the level of professionalism notably because of text analysis. EDF receives more than 70 million emails a year. Analysis allows us to know for what subject we are being contac- ted, the customer mood, and in how many hours must we answer, everything in industrial mode.” The professiona- lism of the team is essential in order to obtain such results: data is a key trade at EDF, who was able to make use of this business thanks to an infrastructure adapted to big data. IoT: AN IMPORTANT VECTOR OF ACCELERATION The first wave of connected objects also played a role for the industries who seized the opportunity before the arrival of the internet age for objects. “We have data of better quality thanks to IoT”, says Pascal Brosset, Chief Technology Officer of Schneider Electric, “We have gone from intuitive management to data driven mana- gement”. Low volume does not cause problems for the company, who finds itself in a position of technological advancement, “at a distance!” in relation the needs of its customer. The acceleration of the development of data takes a strategic turn, one of survival, for companies whose acti- vity depends on data analysis and their integrity. This is the case of Thales for example for which data has become the undertone for all industrial decisions, whether it be for the company itself or for its customers. Connected objects generate data that are then stocked and pro- cessed: “If this data is attacked in the process, whether it is theft or they are corrupted”, analyzes Jean-Ma- rie Letort, VP of Strategy for SI Critiques and Cyber Security at Thales. “Theft is bothersome, and should be known. But if data is corrupted, then the entirety of the industrial system and the process for decision making are damaged.” This situation logically explains the pro- gress undertaken by the company in the field of data. Lack of necessary tools Lack of skills Lack of managing direction’s sponsorship MAJOR OBSTACLEMINOR OBSTACLE 2.12 2.01 1.89 2 3 How would you classify the obstacles to data management by open data with external communities? (1: Minor obstacle / 3: Major obstacle) Note: 476 respondents
  49. 49. 49 Are enterprises heading towards being data- driven? 2 CONTRASTING DEGREES OF ADVANCEMENT It is hard for companies to discuss acceleration without discussing the subject of data in detail. After the framing and adequate structure is put into place (which is not a small endeavor) then comes the necessary research and the first usage. AG2R La Mondiale appointed Emma- nuel Saudeau-Turlotte at the beginning of the year as Digital, Marketing and Client Relations Director. Mrs. Saudeau-Turlotte position is intersecting and she works on date usage with the Chief Data Officer. “The models are starting to function; we are only at the beginning of a long cycle that will transform the company. The first building blocks of infrastructure are in place and all the work for data management has been initiated”, confirms Mrs. Saudeau-Turlotte, indicating the first outcomes will benefit the customers (segmenting and personalization) on the risk and regulation challenges. The keys for acce- lerating are the following, according to Emmanuel Sau- deau-Turlotte: “We must work on the quality of the data and its structure, and begin with specific cases of use and the effects of data, that answer real business questions. We then will use the cases to extrapolate client and ope- rational value. Finally, we will have to equip ourselves both in infrastructure and skill to leverage all the poten- tial of this technology that is still evolving.” Open data: it’s the whole company culture that must change The primary obstacle of open data in data management is company culture and a managing direction with a lack of leader sponsorship. Other acceleration obstacles are easily identifiable: • Technical inability to treat important volumes of data • Presence of Silos • Lack of visibility within the company « The data project is far from complete. The transition from a classical organization to an organization piloted by data has no formal method. Certainly for a company like ours, present in 14 countries with varying degrees of maturity » Olivier Girard, Director of Client Marketing and Data at Auchan Retail
  50. 50. 50 Are enterprises heading towards being data- driven?2 Data analysis has always been a strategic skill for insu- rance companies, who have long attracted the best ana- lysts and mathematicians. However, the entry into the era of data management reveals a completely different exercise for companies in this sector who find themsel- ves on equal footing with other industries, facing the same challenges. Data has thus been a key priority for Goupama in 2016, who launched PoCs and is working on their industrialization. “We are in the process of putting into place a DMP and a data lake, and have selected a number of the most ROI usages cases on the subject,” says Meriem Riadi, the insurer’s Chief Digital Officer, “either the prediction churns or the improvement pro- duces more accurate and likely insurance quotes.” It’s the level of maturity that Cattolica Assicurazioni is still looking for, a major Italian operator. Alberto Ricchiari, the CIO, is working on questions of data pro- perty and infrastructure. “Control of data in the value chain will be one of the major short to medium-term challenges if we are to reach this famous data-driven company. One of the key turning points for IT will be to support a data-driven company with an infrastruc- ture that allows the integration of data from a variety of sources, that leverage simultaneously big data tech- nology and hybrid clouds, in order to be an enabler for all new business opportunities.” Mr. Ricchiari says. The subject has become urgent for the insurer and risks beco- ming an IT nightmare if each department continues to collect its own data. Antoine Gourevitch Senior Partner Accelerate your data transformation now! (1/2) The rhythm of operational data integration is ac- celerating. Ten years ago, only one of ten compa- nies who now have the strongest capital on the stock market in 2017 was built using data: Micro- soft. Now there are six: Microsoft, Apple, Alpha- bet, Amazon, Facebook and Alibaba. This dynamism has a reason. Companies built using data reduce waste and perform better, rising above historical levels. They use updated data and keep their chains as slim as possible in sales, marketing, logistics, manufacturing and RD, im- proving their gross operating surplus (EBITDA) by 20 to 30 percent. However, initiatives surrounding data and trans- formation are often failures, undermined by the projects taking several years, being centralized and extremely costly with regards to system re- design. Following on page 54.  Expert Opinion BCG
  51. 51. 51 Are enterprises heading towards being data- driven? 2 2.2. THE FIRST SPECTACULAR RESULTS The degree of maturity obtained by companies ex- ploiting data varies greatly – and rare are those that are data-driven, rather partially. Nonetheless many gain concrete results right from the start of their pro- jects. This confirms positive medium-term progress in business conduct, in its maintenance and in efficiency gains and productivity in general. 2.2.1. Data: servicing client relations and personalization Whether they are still searching for example usage or they have transitioned to industriali- zation, those interviewed for this Referential have developed a concrete approach to working with data, notably in marketing, where its potential for appli- cation is infinite. At Club Méditerranée, Quentin Briard was able to leverage a large volume of data and benefit from his teams creativity to conduct target market test: “Our first experience surrounding machine learning was on CRM and its targeting capability (technology: TinyClues). The tests that we conducted had very good results showing 30% additional efficiency.” Such an effi- ciency does not merit the reconsideration of the analysts’ work, but does incite the leadership’s necessary reflec- tion on their role’s future evolution, confirmed by the Marketing and Digital Director of Club Méditerranée for the FBS zone (France, Benelux, Suisse): “The role in our BI department is evolving: data visualization, data protection and security, data omnichannels, all are a part of their daily lives.” Data also permits the improvement of a company’s exis- ting tools. The relationship marketing of BUT is already well supported by transactional data, for example: “But we are already going much further!” says with enthu- siasm, Thierry Lernon, Chief Digital Officer of Sales, whose teams have progressed quickly with identifying indicators of customer intention and online visitor iden- tification. For others it was the piloting of major projects that was the opportunity to launch tools integrating data poten- tial. This is the case for PSA Peugeot-Citroën, for exa- mple, who has initiated a global remodel of their website for Peugeot. “We have just started integrating persona- lization in our website experience on sample audiences”, explains Anne-Laure Mérillon, who is head of Interna- tional Digital Marketing for the Peugeot brand. The approach was first tested on the Spanish market. “It aims to facilitate customer choice”, underlines Anne-Laure Mérillon. An essential element considering sales is the primary vocation of the website – a first for the French manufacturer (outside electrical cars). FIRST RESULTS ARE SIMPLE BUT ALWAYS CONCRETE The personalization of the client relationship is a fun- damental characteristic of a customer centric company and a shared objective by a large majority of those inter- viewed for this study. Data permits progress that is now considered basic but that not too long ago was out of reach. “We are successfully able to understand our client profiles,” says Hervé Parizot the Executive Director of e-Commerce and Client Data for Carrefour France: “Carrefour is a multi-format group, with e-commerce, supermarkets, and commerce locations spread across 6,000 points of sales in France. We have discovered Q
  52. 52. 52 Are enterprises heading towards being data- driven?2 much on how our formats are used by customers. They are ‘mixers’, they have understood us and understand the way to use each group’s format.” – a first step that should allow Mr. Parizot to completely personalize the client experience, following the distributor’s objectives. BNP Paribas Personal Finance Denis Kraus Global Head of Digital One to one marketing is becoming a reality thanks to data Decision making motors (bots, after-sales service, etc.) are the company’s biggest investment. We are in the pro- cess of transforming our marketing to create a one to one relationship with our clients. The call center advisors know the client’s history. The data, coupled to machine learning and systems capable of identifying strong si- gnals, permit the company to propose new product and push the correct offer at the right time. We thus focus on clients who are the most susceptible to subscribe to our offer. It is the end of marketing as we knew it in the 80’s! We are also launching a tool that will use an algorithm to identify clients who could face difficulties in the near future. We will be able to anticipate the challenges and contact the client to offer to review his or her portfolio, which is a real advantage in client relations. Prospective clients are a part of a similar initiative, as we wish to ac- company them from the beginning on their request for loans, by anticipating the work they would have to do on their homes for instance. Data permits this type of ini- tiative, and here lies the potential for gaining customer loyalty.  Interview
  53. 53. 53 Are enterprises heading towards being data- driven? 2 2.2.2. Security and maintenance: transitioning from reactive to proactive eyond marketing and client relations, data allows companies to optimize the maintenance of products, infrastructures, and industrial tools with a growing efficiency and precision. The impact on costs and security is as important as the analysis of data allowing for a predictive approach. A change in para- digm illustrated by Ouahcene Ourahmoune, Director of Innovation for the UK and Ireland at Alstom: “the tra- ditional use is to perform a test every x kilometers or at predetermined intervals and to replace the part as soon as it surpasses a limit of usage that was guaranteed.” Alstom is shifting away from this approach to one that is predictive and has even opened a center dedicated to this technology. “Mass data collection allows us to anti- cipate part replacement”, says Ouahcene Ourahmoune. Mr. Ourahmoune’s ambition is shared throughout the industry, where projects are providing concrete results with regards to quality control for Sanofi Pasteur, or client knowledge for GRDF. “Actually, a dozen expe- riments exploiting data internally and externally are underway in our DataLab center on the subject of pre- dictive maintenance or client knowledge” says Édouard Sauvage the General Director. This was a real risk accor- ding to the gas distributor, who has since succeeded in applying preventative measures to drastically limit the probability. The vital and strategic dimension of supplying energy pushes this sector thanks to data to optimize risks. Ene- dis heads a European project working on photovoltaic to allow a system to function even if the power lines are cut. “We used big data to understand if we could pilot a com- munity (a connected micro-grid) thanks to photovoltaic, combining electricity data and heat”, shares Christian Buchel, Chief Digital Officer of Enedis. The first tests concluded virtuous effects well above the company’s basic organization and opens the possibility of dynamic piloting and precise energetic installations in case of accidents. The banking industry is also concerned by data risk management. The analysis of client risk is historic of financial institutions; the transition to predictive analy- sis opens a new dimension and an opportunity to dras- tically reduce costs. “We are opening an account every 30 seconds in France. There are a small number of fraud cases. Artificial intelligence allows us to detect the cus- tomer profiles who are susceptible and to create “scores”: this person, this age, at this location has a certain pro- bability to be a potential risk”, states Hugues Le Bret, co-founder of Compte-Nickel. This evolution benefits the customer. “We are fighting fraud and fishing at a cost that is five times less than the market. The cost is no lon- ger reflected in the service price: here is a virtuous effect of data and artificial intelligence!” B

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