CIO Playbook:
Customer Experience and Digital Transformation

Michael Krigsman: In this age of digital and digital transformation, the role of the CIO is changing and is becoming even more important. Today, we're speaking with the CIO of Logitech, who really exemplifies this innovative digital CIO. I'm Michael Krigsman. I'm an industry analyst and the host of CXOTalk.

I want to say a huge and heartfelt thank you to IPsoft. We are in their AI Experience Lab, and IPsoft is helping make CXOTalk possible.

Massimo Rapparini is the CIO of Logitech. Massimo, welcome.

Massimo Rapparini: Thanks for having me again, Michael. Nice to see you.

Michael Krigsman: It's good to see you too. Massimo, tell us about Logitech.

Massimo Rapparini: Well, Logitech, I think everybody probably knows, is the PC peripherals company. We've been in this business over 35 years. The products that you're probably familiar with are mice, keyboards, webcams, speakers, headsets, and those kinds of things.

In the last five to six years, we've actually expanded into other products that really connect people to the digital experiences that they care about. That sounds pretty fancy, but what does it really mean? As an example, we make mobile music possible for people, so you can actually listen to music through blue-tooth speakers. We've video-enabled huddle rooms and video conference rooms in different businesses. We're also creating and crafting the sporting products that eSports and gamers actually use these days across the globe, so a much richer portfolio than we were maybe ten years ago.

We're about a $2.5 billion business. We're in over 30 countries. I think there are some interesting stats in terms of the sheer volume of the stuff that we do. We have about 30 million products that we ship pretty much every month to 100 different countries. We're about 7,000 employees across the globe, so a very global company.

CIO Role at Logitech

Michael Krigsman: What do you do as CIO? [Laughter]

Massimo Rapparini: It sounds fancy, but what is it I actually do? Well, actually, I'm responsible for about 200 IT professionals across the globe. Really, what I've been tasked with is enabling business growth, which sounds also pretty fancy, but it's really about how we actually implement the technology strategy that helps Logitech achieve its business goals and its growth trajectory.

In terms of the strategy and the focus, a lot of the things that we do are around digital cloud, machine learning, AI, but, also, more and more is cyber security, of course. That's pretty much every business function that I touch across Logitech, and we'll talk a little bit more, I'm sure, about some of the examples of initiatives that we do.

Michael Krigsman: You mentioned innovation.

Massimo Rapparini: Yeah.

Michael Krigsman: I think, historically, there's been this tension between the CIO being responsible for efficiency--

Massimo Rapparini: Right.

Michael Krigsman: --and this distinction relative to innovation. Maybe you can talk about that.

Massimo Rapparini: Yeah, for sure. Yeah, I think that always has been and I think it's still a bit the image of the CIO as the efficiency driver, right? The operational engine of the company.

Realistically, if you look at technology, it's more and more become accessible, more pervasive, and I think it's transitioned the role of the CIO into also focusing on customer-facing type of things, right? Technology implementations that actually help more of the front office parts of a business and, in our case, Logitech as well. I think that, let's say, tension between efficiency and innovation is still going to be there. I don't think it's transitioning from just purely doing innovation. Realistically, it's now a dual role, and you need to balance the two.

If I look at what we've done in Logitech, I think Logitech, on purpose, embraced a method of working such that we actually try to eliminate waste from the system, so where we can be efficient, implement operational efficiencies and be operationally excellent while, at the same time, reaping the benefits of those savings and apply them to innovate and create new products, as an example, or deliver better experiences for our customers.

Innovation vs. Operational Efficiency

Michael Krigsman: How do you merge that innovation side with the operational efficiency?

Massimo Rapparini: Well, for a CIO, I think it's become almost a must, right? It's not really an option. I think it's an expectation equally within Logitech, as an example, from my business peers that I'm not just talking tech stuff, that I'm not just focusing on how I cut costs from the system but, truly, how do I help them implement the technology that really drives the things that they're trying to achieve.

If you're in sales or marketing, you're trying to deploy platforms that allow us to actually work with our partners to deploy more products or sell more in different markets. Or, if you're an engineering team, you're trying to utilize cloud to actually develop new products, right? Those are all things that are expected. I think it's a matter of, like I said, balancing one with the other, but also trying to really keep pace with the pace of everybody else in the company.

Michael Krigsman: How is this different from the CIO role historically?

Massimo Rapparini: Well, I think what's different is, like I said, the actual pervasiveness of the technology, right? The way technology is now, it becomes something that is not just for the geeks back in the back office of the company.

If you look at mobile, if you look at personalization, if you look at the increase of online e-commerce and things like that, it's becoming something you and me, in our daily lives, really have to deal with every day and are seeing increasingly part of how we actually do or buy or do things together, right? I think that has changed the application of technology and has required the CIO to not just be focused on how to keep the trains running, so to speak.

I think what's been also important in terms of a change is the fact that, now, other groups are really more savvy about technology because it's much more accessible. You don't need to be an expert to implement a new or integrate a new e-commerce platform. Now, it's much more of a peer-to-peer kind of dialog versus an expert and an amateur, so to speak.

Michael Krigsman: This pervasiveness of technology, does it create a challenge or an opportunity for you as CIO?

Massimo Rapparini: I think it's becoming more and more an opportunity. I think it's an exciting time to be a CIO. I think being cornered into you're just the operations guy, you're just the techie person to make sure the wi-fi works is not really that compelling or exciting for anybody in the long-term, right? I think it's an opportunity, and the opportunity really translates into multiple ways that you can actually contribute directly through the business.

As an example, Logitech, it's the innovation of new products, it's creating better experiences for our customers, it's actually improving the performance of our company altogether. All of these are new areas where, as a CIO, I'm asked to contribute directly. I think that's, like I said, more and more of an opportunity. Obviously, it's requiring somebody to not be faint at heart and be actually excited about contributing at a faster pace, but I think it's all positive in terms of the importance and the relevance of the IT role.

Michael Krigsman: The speed aspect is very important as well.

Massimo Rapparini: Completely, and I think that's really reflecting the clock speed of not only the organization and the business that we're in, but the industry, right? You probably heard of Geoffrey Moore, the author of the Crossing the Chasm book. He recently published a new book called Zone to Win, and it's interesting. There he talks about how these S-curves of innovation are increasingly happening faster and faster. That's just an observation.

What's the impact of that is really that organizations and companies are more and more needing to adapt and respond to disruption at a faster and faster pace. Well, that pace means it's something that applies across the board, right? You can't, as an IT guy, opt out and say, "You know what? I'll keep going at the pace I used to go 20 years ago." I think it's a realization of that and it's really reflecting the way not just Logitech, but a lot of the companies in this industry need to work at. It's also, like I said, an opportunity to make technology more relevant.

Innovation and Relevancy to the Business

Michael Krigsman: When you talk about technology being more relevant, what does that mean for you?

Massimo Rapparini: Yeah, I think examples of what we've done, if you look at what we've done internally at Logitech, as an example, I mentioned how we've evolved into different product categories. Let's take video conferencing and video collaboration. It's now become almost 10% of our business. It's something that was nowhere before and has been growing, year-over-year, over 50% to 60% growth rate in the last couple of years. That hasn't happened just by the sheer, let's say, implementation or deployment of compelling products, but also by the way we've actually brought these products to market, which required platforms and online capabilities that IT has delivered, as well as the way we've actually embedded that into our own four walls and made it part of our employees become more productive. I think those are always that you're actually then real choices and real decisions and implementation of the technology that impact directly the way Logitech grows as a business.

Michael Krigsman: I know that being a change agent is very important to you, and so would you share some thoughts on that for us?

Massimo Rapparini: Yeah. I think being a change agent for a CIO is a golden opportunity because, if I go back to Geoffrey Moore's discussion about Zone to Win, he talks about, as a company, you can innovate in multiple ways. You always have the tension between keeping and sustaining the stuff that's working well and trying to break off and do something new.

As an IT group, what you can do is actually impact multiple places in the business that help all in terms of innovation. It could be strengthening the performance of the business that we have today, creating environments that allow you to actually experiment and develop new products, or actually helping in terms of really developing and innovating new products. To do all of these really as an IT team, you have the opportunity to actually drive the change and be a leader of the change versus being a recipient of some of these changes. For me, I'm passionate about it because if you are going to be passive about the change and more undergo it instead of actually taking the lead, then you really get cornered very quickly into a role that you maybe didn't pick, a lot of discussions about cost, and really are trying to fight for relevance versus actually demonstrating the importance of what IT can do.

Michael Krigsman: To what extent is digital driving these kinds of changes in IT that you've been describing?

Massimo Rapparini: Yeah, I think, 100%, right? Digital has created new markets, new products altogether, and even new users and new consumers, so to speak. We live in a completely different world than we were 10 or 15 years ago. The pace at which these changes are happening is also increasing.

When you have that kind of environment, as an IT group and as a CIO, you can't necessarily sit back and just see what happens or what the impact is to your business. I think digital, as it exists overall in the world around us, has meant that, as an organization, we need to adapt and change. It has also meant that the IT function itself needs to quickly adapt and change. It's, I think, inevitable and, like I said, I think it's a positive because it's really elevated the role of IT overall.

Changing CIO Role

Michael Krigsman: You mentioned that IT has to adapt and change. This certainly implies talent, hiring, retention of talent. How do you think about that? How do you manage that shift?

Massimo Rapparini: Yeah, well, I think it's 100% something that you need to rethink in terms of how you run internally, right? If I look at, for instance, Logitech a few years ago, we were very back office-centric, very heavy in terms of on-prem footprint of workloads that we use to run ourselves and actually very heavily outsourced. Now, if you look now, a few years later, we're actually 70% of our workload are in the cloud, so we've very cloud-centric.

The talent that we brought in is actually much more in-sourced and we have much more control over I guess what I would call people who are more versatile that can actually take on different roles and also adapt to where the business is going very quickly. Overall, we're really transitioning to something that is a lot more dynamic and agile. I think it's something you do need to have a conscious and deliberate way of approaching differently, but something that is also inevitable. If you don't do it, you quickly become very irrelevant.

Michael Krigsman: How much change was required inside your IT organization to adopt these agile methods and just respond to the expectation of speed that users have towards you?

Massimo Rapparini: Yeah. Well, I think some of that is natural change that, as an example, if you look at the type of employees that come into the company with millennials and people that are more used to a whole different kind of world in terms of technology. You actually get the benefit of some of the changes by virtue of the different generations that are coming in.

For some of the people who have maybe been in the industry longer and have been used to the traditional kind of waterfall IT and what have you, I think you have to manage it consciously. Some of the things we did in the past 12 to 18 months is focused agile training and understanding just agile methodology. We've changed the structure of our organization to flatten it and also create more dynamic, what we call, squads, so teams that are assembled dynamically based on the business needs of the project that we're running, but that can be quickly disbanded and reassembled into something different.

Those are things that it's not something that happens overnight. We definitely say it's a year or two year's change for us. But, it's also something that we've consciously been driving with different initiatives where I mentioned earlier the clock speed is now where we have NPIs, new product introductions, and launches maybe every six, nine months where it used to be maybe a year or two-year type of cycle.

As we actually expand more categories, more brands, more products that we actually play in, then that pace gets somewhat exponentially increased. Now, all of a sudden, you have a new blue tooth speaker coming out, you have a new gaming keyboard coming out, and all of that within maybe a few weeks' timespan of each other. That's just kind of what people see on the outside.

Then, on the inside, everybody needs to be able to support that and operate at an even faster pace to be able to do that. It's not all perfect, a lot of things need to be improved, and we learn from them. But, I think it's reflecting the fact that that's just the way we have to operate to be competitive.

Michael Krigsman: What happens when you acquire companies? For example, you just acquired Blue Microphones.

Massimo Rapparini: Yes.

Michael Krigsman: Which, by the way, is another company whose products we recommend when we're doing our online shows.

Massimo Rapparini: Well, I appreciate it. We'll definitely make you an ambassador for Logitech just because of what you've been doing, but 100% M&As are something that's really important because it's something that realistically tries to leverage the fact that you have expertise, you have brands that are really strong, and that we can easily, let's say, integrate within our company. It's important that we're able to integrate them quickly, and it's a great example of a company that fits well into our portfolio. It supports our strategy in terms of having strong brands and being able to, again, go back to those digital experiences that we're trying to connect our consumers with.

When we do these types of acquisitions for IT, it's another example where we quickly need to understand how we keep the things that are good about the company in terms of the brand, the products, the consumers, the success that they have in terms of the growth that we've been attracted to while, at the same time, trying to find the efficiencies of the operations. That's a perfect example where I think, by now, we did Astro Gaming acquisition last year. We've done a few before then, and now we've done Blue Microphones. I think it's become something that we're getting better at in terms of balancing the efficiency while maintaining the unique part of what we acquire, but also requires a pretty fast pace in terms of making that happen.

Customer Engagement and Experience

Michael Krigsman: You mentioned earlier that some of your work is customer-facing. Please tell us about that.

Massimo Rapparini: Yeah. Yeah, it's interesting, and I think it's something that I expect more and more CIOs or IT teams to start evolving into to taking on not just, let's say, the traditional technology aspect of IT, but also what is the maybe close business function that benefits most from some of these technologies that you could actually help shape and help be successful and support the rest of the company's strategy.

This year, I've been asked to take on customer engagement. We call it our customer experience, which is really all about how we provide the services and the support that our consumers and our customers expect from us to be able to actually benefit from the products that they buy. I think the reason it's exciting for me is, number one, you have to be very obsessed about expectations.

If you're going to talk to customers, there's an expectation we set when we actually create brands. If you're a Blue Microphone customer, if you're a Logitech G gaming customer, you have a brand identity and expectation that needs to also be reflected in the way you experience us when you call and say, "I've got a problem with my gaming mouse," or something. I think you need to be really obsessed about that expectation and matching it to the brand value.

Then, second, you really see the benefit, again, of technology and digital. There's such an opportunity. There's no function besides customer support that has as many touch points directly with customers as that function does. I think the opportunity there is how you use digital to make these touch points really compelling, drive things like customer loyalty, and help, like I said, really reinforce the identity of the brand that people actually bought the product for. I think that's what's exciting, and I think that's also where there is this somewhat intersection between classic IT and digital platforms and more customer-facing type of functions.

Michael Krigsman: Why does customer experience, customer engagement become an IT function as opposed to, say, live inside marketing?

Massimo Rapparini: Yeah. Well, I think you could argue either way. I'm not arguing that it has to be an IT function. In our case, it went that way, I think, partly, because it does reflect that, as an IT team, we've demonstrated leadership in terms of let's actually talk more about business than just purely about technology. That's, I think, just purely how that's played out in our case.

You could definitely argue it could also go with marketing. Marketing, these days, and our CMO is a perfect example, where we partner very closely because that's also so much more digital than it used to be.

I think the benefit of having IT and customer engagement together is not only these platforms and the rise of chatbots and AI you can apply in terms of the experience that you can provide, but also the fact that you can now benefit from similar, let's say, requirements around functions. How do you really deliver services in ways that are customer friendly? How do you measure and make sure you have discipline around performance management and delivering on customer expectations? I think there are a lot of synergies there and benefits in terms of combining it. Like I said, I think, for an IT team, it's also an exciting way to actually change the way we operate.

Michael Krigsman: It's really a matter of institutionalizing customer engagement and the right type of experience as opposed to just, "Well, we're all going to try really hard."

Massimo Rapparini: Yes.

Michael Krigsman: [Laughter]

Massimo Rapparini: [Laughter] Yeah, I don't think that will cut it exactly, but for sure there's a lot of things you need to put in place to make that happen. I'm under no illusion that Logitech or some of the other brands that we have today were the best in class and there's a lot of work still to be done. But also, the consumers' expectations are changing, and that's partly why you also need to be really thinking about not just purely digital, but how consumers and customers changing themselves and what the expectation is in terms of the interactions that they have.

I think a great example, as we talked about gaming, eSports, and how crazy it's growing, I think read something that said it doubled in terms of video game software sales in the last five years. The likes of PlayStation subscriptions are over millions and millions of people. eSports gamers are now expected to be bigger celebrities than NBA players or something like that.

If you look at how that's evolved, it means that the people that actually are into those products are also--and we see that--expecting different interactions using platforms online like social, like Twitch and Steam, and looking at ways that they can copy configurations of gaming setups that others have with their products that they bought from Logitech. There's a lot of, let's say, touchpoints and interactions that are completely changing in terms of the dynamics. And so, if you have all that and then, let's say, our customer engagement capabilities are still simply, you know, give us a call and there'll be an agent that tries to walk you through a few troubleshooting steps, it's not really matching and not as compelling as what you would expect in terms of that customer engagement.

We're looking at ways that, you know, can you actually change the type of agents that you interact with, the conversations that you're having? Is it a chat online? Is it in an app or what have you? I think there are a lot of changes there, as an example, that we anticipate.

Michael Krigsman: The proliferation of technology that's affecting internal expectations of you at the same time you are changing your customers' expectations because your customers are becoming much more sophisticated.

Massimo Rapparini: Completely. Yeah, sophisticated, completely different dynamics, and different expectations. I think what you can learn from that and apply it inside your four walls is that you need to not only be obsessed about those expectations, but also look at ways you can make experiences effortless. That you really focus on the journey and the experiences that people undergo when they actually interact with Logitech, and really apply that internally as well in terms of people that work with us and you work with your partner within the company.

Yeah, I think there are benefits both ways. There are things you learn inside that you can apply outside and the other way around.

Business Leadership and the CIO

Michael Krigsman: Massimo, you've mentioned relevancy several times. Is relevancy a function of all of these things, or is there some other dimension that drives relevancy of the CIO to the business?

Massimo Rapparini: Yeah. For sure, all of these things. I think relevance has to start with leadership, actually standing up and stepping up, and trying to influence the conversation into something besides just purely cost or things around operational efficiencies. But, it's also, like I said, something that is mandatory in the environment that we're in. I think if you don't take up a role that's more than just purely running the email and the wi-fi, then what happens is other companies, and especially if you take digital natives.

Take Uber or take Facebook or Google. These companies apply technology second nature, like it's something that is assumed, it's everywhere, and it's pervasive. They have to because that's kind of what they've been born into as a digital native.

As these companies, in their IT shops, operate in a whole different way in terms of how they apply technology, if you don't do that, you're not only becoming, as the IT team and as the CIO, potentially irrelevant, you're actually doing a big disservice to the company. You're actually allowing everybody else to run away with your lunch. I think that's the opportunities for an IT team and the CIO is to not just think about your own relevance, but how can you actually boost what the competitive, let's say, aspect is of your own company as well.

Michael Krigsman: As we finish up, I'm sure that there will be CIOs listening to this saying, "Yeah, this sounds great. This sounds great, but how do I do it? How do I start?"

Massimo Rapparini: Yeah. That's a great question. I don't know that I have the secret recipe, but I think there are a number of things that people can think about. Like I said, for me, personally, I think there's never been a better time to be a CIO. I think, if you start with that mindset and realize the fact that technology now plays such a prominent role that people actually will turn to you. I don't think you need to make a lot of marketing effort to promote yourself, but people will turn to you more often to ask about how to make use of technology in a competitive way. I think that's the first step because then you can actually start observing and finding opportunities that you maybe didn't look for before.

The second is, I think you need to also be clear for yourself what is the role that you are passionate about because some people and, I think, in some roles in some companies that may still be valid. If the biggest value you bring is making sure the servers are up, the email doesn't go down, and people are able to get to the cloud or what have you, and that's a valued role and that makes sense, I think if that's something you're passionate about, you should really focus on it. If you're going to try to become something you're not passionate about, you should definitely rethink that.

I think the third piece is really understanding what the strategy is of your business. In our case at Logitech, we're building more and more products that have cloud built into them. We have computer vision, AI, machine learning, and all these different new technologies. If that's what the business and the company is doing, you'd be a fool not to try to actually contribute to that when you are an IT expert, right? Understanding what the business is trying to achieve and being able to figure out how you can contribute, I think, is the other piece.

Michael Krigsman: Okay. Massimo, thank you so much. Again, thank you so much to IPsoft for underwriting this series. We are in their AI Experience Lab in New York City. IPsoft is literally making CXOTalk possible.

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