Culture Change:
Digital Transformation in Marketing, Communications
Culture change is as much a part of digital transformation as technology itself.
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Culture change is as much a part of digital transformation as technology itself. Nick Tzitzon, EVP of Marketing and Communications for SAP, speaks with CXOTalk about how marketing and communications are needed to reach both employees and customers.
“It’s hard for people to trust their own instincts. It’s hard for people to really make an emotional connection with people as opposed to doing what they’re advised to do by all the influences around them. That’s an ongoing battle. You never get over that,” Tzitzon says. “We always believe in putting the human connection first… The more you can share with people personally what makes you tick and what about that personal motivation connects to what the business is trying to do, that’s when progress gets made.”
Tzitzon is Executive Vice President, Marketing and Communications, for business software market leader SAP. He leads the company’s 2,000 marketing, communications and CSR professionals in shaping the world’s 21st most valuable brand. He previously served as senior VP and COO at Bronner, a boutique management consultancy focused on helping public sector agencies to run better; as chief of staff in the Justice Department’s Office of Justice Programs; and as deputy director of state and local public relations under U.S. Health and Human Services Secretary Tommy G. Thompson; and in numerous positions in Massachusetts state government. He’s also an adjunct faculty member at DePaul University and a frequent on-air contributor to SiriusXM Satellite Radio, WGN and WLS in Chicago.
Michael Krigsman: Culture change is an absolutely essential part of any transformation, any digital transformation. But, the question is, how can marketing and communications play a role in transformation and culture change inside a very large organization, an organization at scale? That's our topic today on CXOTalk.
I'm Michael Krigsman. I'm an industry analyst. I'm so thrilled to welcome Nick Tzitzon, who is the executive vice president of marketing and communications at SAP.
Now, before we begin, I need to say a heartfelt thank you to IPsoft. We are in their AI Experience Lab in New York City. It's folks like IPsoft that keep CXOTalk going.
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Nick Tzitzon, how are you? Welcome.
Nick Tzitzon: I'm ready to subscribe.
Michael Krigsman: All right. I love that.
Nick Tzitzon: [Laughter]
Michael Krigsman: Nick, tell us about SAP.
Nick Tzitzon: Well, do you ever think about how you use applications in your consumer life? How do you book travel? You do all that stuff.
Fifty years ago, five engineers in Germany basically asked that same question, but for business. How do businesses use applications to make their businesses run better? Well, fast forward, SAP is now the business software market leader in 190 countries with 400,000 customers. It's a great company.
Michael Krigsman: Okay. You're responsible for communications and marketing.
Nick Tzitzon: That's right.
Michael Krigsman: Tell us about what you do and the scope of that responsibility.
Nick Tzitzon: Well, it's a fantastic team, first of all, right? None of these things happen with any individual, so we've got a fantastic chief marketing officer, a great chief communications officer. If you think about a company, like you said in the introduction, at scale, we have 100,000 employees in almost every country on earth. We have 400,000 customers in almost every country on earth.
How do you keep a company together? How do you keep a company on message? How do you keep a company engaged about the topics that they care about? That's what our job is every day.
I've got to tell you, it's a unique way to see a company at scale. It's a unique way to see a company that's changing. When you put the message and the brand in front of the business, it's a really a fascinating thing.
Create a Cohesive Whole in the Organization
Michael Krigsman: How do you knit together a company that has such a diversity of geographies and professional backgrounds and markets that you sell to? How do you create a cohesive whole?
Nick Tzitzon: Do you know what the hardest part is? I think it's something that people learn as they grow in their career that they have to be so rigidly prepared for everything. People are always on script. The more that people are on script, the harder it is for people to actually understand what a leader really wants a follower to understand.
Our job is to break through that. We have tried everything we can think of, and we have many more ideas that we're going to put into practice, to break a big company, 50 years old, like SAP, out of some of its rhythms.
If you think about a startup, what's the image you have in your mind of when a founder of a startup gets a small team together? You kind of think beanbags, don't you? Right. They're sort of relaxed, and they're just talking straight. We have to create that same vibe in a big, established company like SAP so that people really can see through some of the things that have been layered on over the years and focus on the business strategy.
Michael Krigsman: Why is that so hard to do for any large organization?
Nick Tzitzon: Because of expectations - expectations. Everybody is expected to do this or to do that, and they're concerned about who is watching. "I wonder who is watching this and what I should be saying?" It's always that kind of an attitude, so it's hard for people to let loose.
It's hard for people to trust their own instincts. It's hard for people to really make an emotional connection with people as opposed to doing what they're advised to do by all the influences around them. That's an ongoing battle. You never get over that.
On Authenticity in the Market
Michael Krigsman: What are the steps that you take to try to break through that?
Nick Tzitzon: I'll give you a great example. When our leaders are engaging with our employees or our customers, you're naturally thinking about what content do they want to deliver about SAP. What's the business pitch I want to give?
We always believe in putting the human connection first. What's your career background? What did you do? I mean I used to work in politics. I worked on campaigns at the local and the state level. I went to Florida for the recount, remember, with the magnifying glasses looking at ballots.
Michael Krigsman: Yes. Yes.
Nick Tzitzon: The more you can share with people personally what makes you tick and what about that personal motivation connects to what the business is trying to do, that's when progress gets made. That's when guards get dropped and people are more willing to engage with you on an emotional level.
Like I said, this isn't something that's easy for people to do, so it's a constant exercise in pushing them to do that. What's the personal story that's going to make that connection? If we can succeed in that area with more leaders and more audiences, we'll have better business results.
Michael Krigsman: It's that personal connection that brings authenticity to the market.
Nick Tzitzon: That's right. That's right. People want to know who you are, right? If you look at the way that the capital markets behave, they rate and trade and price leaders as much as they do business results.
Do they have the confidence, Michael, that you're going to take CXOTalk to another ten million minutes of online viewed material? That's how they're going to invest in your stock. If they don't know anything about you, what right do they have to believe that you're going to do that?
These are the lessons we try to teach, and these are the things we try to relay. You know what? Everybody notices when you do more of it.
Michael Krigsman: There's a very strong element of engendering confidence and trust by exposing yourself.
Nick Tzitzon: That's right. If you think about it, you mention the cultural diversity. It's always a calibration.
In Europe, as an example, where the majority of our employees are--we're headquartered in Germany. We have 20,000 people on our home campus in Waldorf, Germany--in the German culture they don't like a lot of overt positivity. They want to know what you are focused on that's a challenge for the business because that's what they want to focus on. That's how they want to move the company forward.
To go in with a lot of sensational talk about how we've never been greater, that doesn't actually resonate in Germany. It's a question of meeting people where they are and helping them understand where you are. That's kind of this constant tug-of-war that exists between communicators, marketers, and audiences.
The conventional wisdom, "If you just keep pushing stuff at your audience, they're going to listen," that's so wrong. You have to gently pull them in the direction you want them to go. If you succeed there, they'll open themselves up to all the points you want to make and more.
Driving Culture and Authenticity at Scale
Michael Krigsman: This brings up a complexity question because, in your case, you have 94,000 employees.
Nick Tzitzon: Mm-hmm.
Michael Krigsman: Obviously, there's, again, this very diverse set of cultural backgrounds. When you talk about corporate culture inside SAP, how do you weave all those pieces together?
Nick Tzitzon: The first thing is, there's not just one message one way. I mean ask yourself. How many times have you heard something that was generic, intended for everyone, that really, really resonated with you personally? It doesn't happen all that often.
When it does, it's like striking gold. It's great. But, if you're an engineer working at SAP and you've been developing software at SAP for 30 years, you're going to look at topics fundamentally differently than, say, someone who comes into the marketing organization in their early 20s.
How can we, again, calibrate? What do we want the message to mean to you personally? How do we want to give you the power as an individual to connect with the message and to act on what we're saying?
These are where you have to push the conversation further than it normally goes.
Putting up a nice, fancy PowerPoint slide and saying, "Okay, everybody has the message," that doesn't cut it anymore. You have to help people connect to the message and then connect to the action that you hope the message inspires. That's not an easy job, and that's why people like me have jobs we have, and it's a race without a finish line.
Michael Krigsman: What is the intersection with culture here? You're describing the messaging.
Nick Tzitzon: Mm-hmm.
Michael Krigsman: What does that have to do with the culture?
Nick Tzitzon: Everything. Everything. We went through a messaging exercise around culture three or four years ago. We basically went out to the employee population, and we said, "If you had to put down on paper what are the qualities about the culture of SAP that you think speaks to the kind of company we want to be, what would those be?" We had this exhaustive exercise.
We had a really talented, young, high potential who ran this for us, and the five behaviors that came back as a result of the employees driving the conversation, they speak to exactly what we want people to do in their job every day: build bridges, no silos; embrace diversity. These are the kinds of qualities that are the underbelly of a culture where, if you're giving people the values that you believe the company should stand for, again, you're helping them understand every single day how you connect to those values, how you role model those values.
It's not a top-down exercise. It's not exclusively a bottom-up exercise. It is both because everything about the culture you want has to radiate from the messaging you have.
Michael Krigsman: As you drill into this dimension, these dimensions of culture change, you just alluded to measures and marks of success.
Nick Tzitzon: Mm-hmm.
Michael Krigsman: How do you measure and what are the metrics that you think about?
Nick Tzitzon: Well, it's maybe the toughest thing. You said culture. I wonder how many people watching us today could sit back after we're done and say, "What should I measure that I'm not currently measuring?" It's a hard thing, right?
The second you start to measure something, you actually have to stare the results in the face. Am I doing what I think I'm doing? Is the outcome directly tied to what I invested in it?
In our case, there's only one measure for us that really matters, which is ultimately the performance of the business, the way that customers adopt the software. In terms of the content we create as marketers, as an example, are we actually breaking down walls and reaching new audiences?
I mean it's one thing to measure the volume of activity around the content we create, but you have to go a level deeper. Who is it? Who is reading it? Is it just our 94,000 employees? Because, if it is, I've got news for you. The money we're investing isn't worth what we're creating.
You constantly have to set a goal. We want to reach new audiences. We want to reach this many people. We want to reach them in this specific industry in these specific geographies. At the end of the day, when the CEO and the executive management team of the business get you around the table, you know what they're looking at? How did the business do?
At the end of the day, you can't take your eye off the number one measure and the measure that the management of the company is using. How do you get granular where it counts, but how do you tie it to the big picture so that the same company metrics that the management team and the board use, the marketing and the communications team are also using?
Aligning Strategy and Objectives
Michael Krigsman: That's the key to keeping marketing aligned with the core company strategy and objectives.
Nick Tzitzon: Yep. At SAP, we have what's called a digital boardroom. It's when the management team meets. They put a digital interface, and they're able to interact in real time with how the business is performing. They can see customer adoption by geography. They can see renewal rates. They can see how the sales organization is building pipeline across the different portfolios. They can see customer satisfaction and how long it's taking us to get back to customers who have questions. That's the data that moves the business.
In our role as marketers and communicators, if we're detached from those metrics, we're totally irrelevant. It's how do you look at the same experience, how do you engage with the same data points, and how can you sit back? Again, if there's an issue in the business that the CEO cares about that's keeping the CEO up at night, which, incidentally, Bill tells me all the time there are issues that keep him up at night, what are those, and what are we doing in marketing and communications to address those topics, aggressively, so that, when we sit down, we're not talking about some great thing over here that's we're doing that's so cool that maybe someday will make a difference? We are right down the middle in the center of the conversation exactly where the CEO and the business are.
Michael Krigsman: Nick, you mentioned data.
Nick Tzitzon: Mm-hmm.
Michael Krigsman: What is the role of data and where does data fit into this picture that you've been describing?
Nick Tzitzon: Everywhere. Everywhere. I don't think anyone is ever done on the data conversation. Where are you getting it? How are you validating it? How are you sorting it and cleansing it? How are you getting people on the same page so that we can all look at one version of the truth? How do you then use data to directly fuel behavior? And, how does that behavior directly fuel outcomes?
It's an hourly conversation, right? This is, frankly, the exciting part about being in the technology industry right now, particularly in the enterprise technology industry. This is, you said, cultural transformation, digital transformation. This is changing everything about how a business runs - everything.
Obviously, we have a strong point of view about how it can drive machine learning, as an example, in our applications. What can humans and machines together do to make a business run better that historically has relied only on human behavior?
But, as marketers, and as communications, data is gold, steel, whatever. Everybody has got a different thing about what it is. But, we have got to be able to show, for every dollar or euro we spend, how does that directly connect to the metrics we track? How do we use those metrics to directly fuel business behaviors that grow the company and, ultimately, make the customers more successful?
If I can show that in that digital boardroom experience that my management team uses, they're going to invest more in marketing and communications. If I can't, and I'm simply relaying it to you as a gut decision, "You know, I feel good about what we did, Michael. I really do. I feel like it's making a difference," that's great. Have a nice day. But, if I can prove it, then we've got a conversation.
Michael Krigsman: We hear phrases like data is the new oil. What you're saying is that the useful data is the most practical data that tells us what's going on in our business today, about the things that we care about.
Nick Tzitzon: It's just like anything else. You know. If you care about a topic, the white noise surrounding that topic can distract you from what you really care about. Data is the same way.
Business fundamentals are business fundamentals. You have customers. You have products or services. And, you have people and culture.
Are you using this new found power, this oil, this steel, this oxygen? I mean I've heard every single term you can think of to describe data. Are you actually using it to drive a great culture and empower people? Are you using it to build and sustain better products and services? And, are you using it to delight customers and keep them?
The last I checked, any business school education is going to focus in some way on those things. Data is simply the latest and greatest tool in the toolbox to make those things more successful.
On Remaining Focused on Core Issues
Michael Krigsman: Nick, on the subject of shiny objects, we are inundated with news, with technology, with marketing hype of every type. How do you ensure that your marketing team doesn't get sidetracked with these shiny objects and, at the same time, how do you ensure that while not being sidetracked, that they're not ignoring it because then they won't be part of important conversations? How do you help them strike that balance?
Nick Tzitzon: It's a really tough balance. The natural scenario in tech is to want to get people excited. We're sitting in an AI showcase for a great company, and it's exciting. What these technologies can do, what can happen when you connect devices in the industry 4.0 scenario, what you can do with machine learning and AI. Blockchain is a territory that most people don't even understand, and the surface is only just been scratched.
I think the challenge is constantly to come back to that one thing. Do you have a satisfied customer who trusts the business? If you do, giving them access to that content in a way that makes it easy for them to understand their opportunities is the key.
Sending off big fireworks displays and getting them excited without a clear path for them to move forward frustrates them, and it oftentimes will have the effect of sending them off in different directions to get the information that you weren't able to provide. To me, it's a customer centricity question almost as much, if not more, than it is how you balance hype versus reality.
Who is your customer? What are they trying to do? What are their historical challenges? And, how can you give them information about the new world, whatever the new world is, that takes into account and respects the scenario that you know about who they are? If you can do that as a marketer or as a communicator, then they're going to listen to what you have to say.
They're going to push you and pull at the same time. It'll be a dialog, two ways, which is always healthy. And, maybe, just maybe, there's a business outcome at the end of that tunnel where they'll move forward with the company and actually experiment with some of the new technology. That's what SAP, I think, tries to do because, if you don't have a long-term customer relationship, then you don't have success.
If you think about how enterprise technology has evolved, if you think 10 years ago, 15 years ago, you had the chief information officer, which was the single dominant point of contact inside most businesses for how a business uses technology and then what happened? CXOs, right? Many of whom have been on your show.
Every CXO became a technology buyer. The CXO technology buyer was interested in very specific business outcomes. If you're a chief human resources officer, you buy human capital management software because you want to inspire and retain and train your workforce. If you're a chief marketing or sales officer, you want to grow your business. You want to attract customers. You want to deliver new customer experiences.
The CIO, in many cases, because of their long-term relationships, was stuck in one conversation while the CXOs went into a different conversation. We want to push them together because that's where they belong. The CIO is an incredible resource in companies to be able to tell you, "Here's a business problem and a technology that can help."
As technology is maturing so quickly with AI and all the other breakthroughs that we've discussed, you need the CIO to be a leader in these companies, but the CIO conversation and the CXO conversation have got to be the same conversation. What opportunity are we trying to seize? What problem are we trying to solve? It can't be technology for technology's sake because, if it's that, then the technology vendor like SAP is not relevant. What are we trying to do for the business? That's the question and the conversation that we need to be part of and that our peers want to be a part of as well.
How to Humanize the Marketing Message
Michael Krigsman: How can a company like SAP humanize its message, and what does that even mean to humanize the message?
Nick Tzitzon: There are several ways to look at it. One way, which we do, is to say, "Okay. If you look through to the end outcome, what are those outcomes?" If you're a business executive and you're buying my software, what exactly has improved about your customer, your end customer's life because of what you were able to do using the software you bought from me?
We want to tell that story because, if we're telling that story about the consumer who maybe was able to order the personalized products she wanted because you were using a more modern platform in your business to do it, it helps people in the masses to understand the idea of enterprise technology. "Oh, I was able to customize this because I bought it from this company and they run SAP." That's great. That's one way to humanize the brand, I think.
But, I think another way to humanize the brand is to do a lot of what we've been describing, which is to fundamentally change the engagement model for how a company like SAP engages with its customers. To be more honest and approachable. To be more transparent about vulnerabilities. I mean our CEO, probably the most noted speech he's given in the last couple of years was a speech in which he admitted issues that were really agitating our customers. People gave him enormous credit for that.
He took a 90,000--at that time--person company with--at that time--300,000-plus customers, and he brought it down to a one-on-one conversation where, "I know you have this problem; I know you're unhappy about it, and I'm personally committed to solving it." That's humanizing a technology brand. That's making it more accessible and more relatable for people who are used to thinking about it as this giant company that's totally unapproachable.
I think if you can do both of those things, one is sort of the way you communicate the story about what your business is ultimately accomplishing through the lens of what your customers are doing, but also break down the wall. I mean this is business. We're all just trying to work together to get things done. The more you can have a human conversation in the day-to-day conduct of that business, you'll end up with a more humanized brand.
Michael Krigsman: Nick, there are people watching this who say, "Yeah, this makes sense. It's really simple," but somehow we're having trouble doing it. We're having trouble connecting with the customer in this way. What advice have you got for those people who are listening, and they say, "This is a good idea. How do we do this?"
Nick Tzitzon: Don't overcomplicate it. Do you remember that ad? I want to say it was United Airlines. It would have been 25, 30 years ago. This great ad where the CEO comes into a conference room, and they had just had a bad result. I don't know. Maybe they didn't have a good quarter and morale was low.
The CEO walks into their boardroom with his management team, and he passes out airline tickets. He says, "It's time to get back with our customers and figure out what's going on." This isn't complicated. Every business knows who the customers are. If you don't, then I've got news for you. You're probably not in business for long.
Everybody knows who their customers are. Figure out some way. Maybe if you're a marketer, spend your money less on some advertising or sponsorship, and actually set up an event that exists for the sole purpose of customers to come in and tell you what they don't like.
Michael Krigsman: My, that's painful.
Nick Tzitzon: But rewarding.
Michael Krigsman: [Laughter] Okay, I think that's excellent advice. Unfortunately, we are out of time. What a fast and very interesting conversation this has been.
We've been speaking with Nick Tzitzon, who is the executive vice president of marketing and communications at SAP. Nick, thanks so much.
Nick Tzitzon: Thank you, Michael. I really enjoyed it. Appreciate it.
Michael Krigsman: Once again, I want to say thank you to IPsoft. We are in their AI Experience Lab in the heart of the financial district of New York City. We're very grateful to IPsoft for making this possible.
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