Digital Transformation in Professional Services

Michael Krigsman: We are live at Sapphire Now 2018 in Orlando. I'm Michael Krigsman. I'm an industry analyst and the host of CxOTalk. Right now, we're speaking with Frank Friedman, who is the global chief operating officer of Deloitte. Frank, how are you?

Frank Friedman: I'm great. I'm glad to be here. Thank you for inviting me.

Michael Krigsman: Well, thank you. Please, tell us about Deloitte.

Frank Friedman: I'd like to think most people know about Deloitte. We are a $43 billion global consulting, accounting, tax firm. We have 280,000 people throughout the world. We are growing. We think we are innovative.

Our operating models continue to change based upon our customer needs. Our focus continues and will always be our clients, our customers. And, I hope we are providing trust to the public markets, and I hope we are finding solutions that are impactful to our clients.

Michael Krigsman: Frank, as the chief operating officer of this very, very large organization, what are your key areas of focus right now?

Frank Friedman: Well, I think my job really is to merge strategy with execution, and so that strategy can be what we're doing in the businesses. It can be how we're starting to build out more and more products. Our model has really become much different.

For a long time, people thought, "You're just an accounting firm; you're just a tax firm." But, consulting is really a significant piece of our business as well. And so, our model is not only time and material now, but it's building of products, building of IP, selling of products, selling of IP, subscription-based income, working with the global economy in terms of contractors. My job is to start taking that, the strategy, and making certain it gets implemented.

Michael Krigsman: I know that customer experience, or client experience, is very, very important to you. Maybe you can give us some insight into that.

Frank Friedman: Serving clients is what we do. That is our whole mission is to serve clients, to have an impact that is important, and to be able to serve clients in an exemplary manner, to solve their issues, to have trust in the markets. Behind that, it takes a little infrastructure. A big piece of my job these days is really to try to globalize the firm.

The big four is really a confederation of member firms. Each member firm, they are linked together, but they're independent as well. They have their own CEOs. They have their own boards. They have their own governance. My job is to kind of break down some of the barriers and the borders, as they exist relative to the infrastructure, and run our firm like a global firm, like we run our businesses.

It's hard for us to tell a client, "You should imagine, you should build, and you should run," and then we don't do it ourselves. It's important that we become the model and we have the experience. I'm really optimistic as to what we're going to accomplish as a global firm over the next few years.

Michael Krigsman: Clearly, there's an element here of driving efficiency but, equally, and maybe even more important, it sounds like you're using this globalization effort as a way of driving innovation.

Frank Friedman: First, I agree with you. There is an efficiency play. If you do technology right, and if you do globalization right, not every geography has to implement, innovate, design, and do the same things because it's already been done. You should be able to roll it out on a much more scalable basis much quicker. That's important, but it is not as important as making certain that we serve our clients in a global manner. In the end, our clients expect us to do that.

Michael Krigsman: When you say, "Serve your clients in a global manner," can you elaborate on what that means for you?

Frank Friedman: What it means is, when they call Deloitte, they're calling Deloitte. They're not calling Deloitte U.S. or Deloitte U.K. or Deloitte Australia. They're calling Deloitte, and they expect Deloitte to deliver on its promises and Deloitte to deliver the solutions and Deloitte to deliver the audit quality anywhere in the world at any time.

Michael Krigsman: Breaking down silos, it sounds, is a core part of this as well.

Frank Friedman: It absolutely has to be. We need to be broad, not narrow. The services that Deloitte offers in audit, tax, and consulting are very broad services. Frankly, nobody can compete with the services we provide in a one-stop-shop. But, it has to go broad. It can't be limited by borders.

If it gets limited by borders, you can still serve, but you're sub-optimizing what the potential can be. I think good companies, great companies, they see where they are today. But, frankly, they look at where they should be and can be and will be five years from now.

Michael Krigsman: Frank, can you share with us how you drive transformation across such a very large organization?

Frank Friedman: That's a great question. I think it's not simple. People oftentimes get caught up in the minutia of change. In technology, as an example, they would get caught up in customization or how good can we integrate with other systems.

But, they need to do something different, I think. They need to start with, what's the end goal? Have the end in mind.

They then need to think about their culture and how their culture can support transformation. Does their culture today support transformation? If it does not, then how are you going to change the culture to do that?

I think a lot of it is top-down driven. You have to have business leaders committed.

Michael Krigsman: Being relentless at this seems to be a key element as well.

Frank Friedman: You do. Every time you go someplace, you better start singing about transformation, why, what you're doing, what you've accomplished, and where you're going to go. I think if you keep messaging and have the patience to get there, you'll get there.

Michael Krigsman: Wonderful. Frank Friedman, COO of Deloitte, thank you so much.

Frank Friedman: My pleasure. Thank you very, very much.