Malcolm Frank’s focus is on shaping Cognizant’s corporate strategy and global brand in order to maintain our track record of rapidly growing market and mind share. He joined Cognizant in 2005 and has more than two decades of experience in the information technology industry. Prior to joining Cognizant, he was co‑founder, President and CEO of CXO systems, an independent software vendor providing dashboard solutions for senior managers. In addition, he was the founder, president, CEO and Chairman of Nervewire Inc., a leading management consulting and systems integration firm. Prior to founding Nervewire, Mr. Frank was a co-founder, executive officer and SVP at Cambridge Technology Partners, where he ran Worldwide Marketing, Business Development and several business units.

As a recognized industry thought leader, Mr. Frank is a frequent speaker on key issues of IT management. He has been profiled by Forbes magazine and ABC’s 20/20 and quoted in such publications as ComputerWorld, InformationWeek and Business 2.0. He is the subject of a Harvard Business School case study on Leadership and Management and was named “One of the most influential people in finance” in 2005 by Risk Management Magazine. He is a graduate of Yale University with a degree in Economics.

Transcript

Michael:         

(00:04) Hello, welcome to episode number 77 of CXOTalk. I am Michael Krigsman and my – I keep thinking of superlatives but I can’t think of enough. My superlative worthy co-host, Vala Afshar.Vala , how are you doing.

Vala:   

How are you?

Michael:         

(00:23) So we have this fist bump that of course nobody can see. We used to have a fist bump cam.

Vala:   

Yes. We might bring that in future episodes.

Michael:         

(00:31) I think we need to bring that back and we’re here with a very interesting gentleman, Malcolm Frank who is the Executive Vice-President responsible for strategy and marketing at one of the largest computer services companies in the world, Cognizant. Malcolm how are you?

Malcolm:        

(00:50)I’m doing great, thanks for having me.

Vala:   

(00:52) Malcolm thank you very much for joining us. Could you briefly tell us about your background and what you do at Cognizant?

Malcolm:        

(01:00) At Cognizant I think I basically just fly too much, but it’s terrific. But as you were saying, we’re a large consultium and system integration and business process firm. About 185,000 employees around the world, working mostly with Fortune 500 companies all around the world.

(01:26) My role at the company, I wear three hats. One is I am the Chief Strategy Officer, so figure out where the industry is going, where technology is headed, what our clients are up to and what do we best serve going into the future.

(01:39)Also the  Chief Marketing Officer, we do about 10 billion of revenue, so need to worry about how do we find opportunities in the market and continue to grow as we have.

(01:50)And the third is I head our digital consultium groups, so helping clients map the transition to the digital economy and the work they conduct in theirs. So, I’ve been with the company for nine years and that’s where I’m up to.

Michael:         

(02:05) You were or maybe still are associated with the Cognizant center for the future of work and you wrote a book out of that. So maybe you could tell us about your connection with that center and what it is and about your book.

Malcolm:        

(02:21) Yeah, the Center for the Future of Work, we about five years ago launched this. Because we felt we were at this important (Unclear 02:29) and in many ways they are just organized in the wrong way. They’re constructed for the past and aren’t ready for the future.

(02:37) So we decided to look at that empirically to understand what’s going on. We brought together some world class analysts into the group and on top of that work with a number of academic institution with CEAG, MIT, Carnegie Mellon and (Harbin?) Kentucky and have been a number of work projects over the past several years around the issues of our industry structures transforming and also how our company structures in the very nature of the work itself beginning to transform.

Vala:   

(03:13) As you conducted this study can you talk to us a little bit about technology trends that impact the future of work.

Malcolm:        

(03:21) Yeah, I think the largest we all deal with it in our consumer lines. It’s interesting, when I joined this industry over a quarter of a century ago, I probably shouldn’t have admit that at least to myself.

(03:33) But this was where the action was in hi-tech, the cool stuff was happening at scale. It was happening in corporations, and that’s been very different in the past decade. The consumer market has been where the action is and things have been on fire. And that’s been driven by four technologies constructwe see working in parallel. It’s social,Facebook and Twitter are obviously the vanguard leaders of that.

(04:03) It’s been happening mobile and all of these highly mobilized and going to become more and more mobile. Analytics and advanced analytics and what we’re seeing with data science. And the final

Michael:         

(00:04) Hello, welcome to episode number 77 of CXOTalk. I am Michael Krigsman and my – I keep thinking of superlatives but I can’t think of enough. My superlative worthy co-host, Vala Afshar.Vala , how are you doing.

Vala:   

How are you?

Michael:         

(00:23) So we have this fist bump that of course nobody can see. We used to have a fist bump cam.

Vala:   

Yes. We might bring that in future episodes.

Michael:         

(00:31) I think we need to bring that back and we’re here with a very interesting gentleman, Malcolm Frank who is the Executive Vice-President responsible for strategy and marketing at one of the largest computer services companies in the world, Cognizant. Malcolm how are you?

Malcolm:        

(00:50)I’m doing great, thanks for having me.

Vala:   

(00:52) Malcolm thank you very much for joining us. Could you briefly tell us about your background and what you do at Cognizant?

Malcolm:        

(01:00) At Cognizant I think I basically just fly too much, but it’s terrific. But as you were saying, we’re a large consultium and system integration and business process firm. About 185,000 employees around the world, working mostly with Fortune 500 companies all around the world.

(01:26) My role at the company, I wear three hats. One is I am the Chief Strategy Officer, so figure out where the industry is going, where technology is headed, what our clients are up to and what do we best serve going into the future.

(01:39)Also the  Chief Marketing Officer, we do about 10 billion of revenue, so need to worry about how do we find opportunities in the market and continue to grow as we have.

(01:50)And the third is I head our digital consultium groups, so helping clients map the transition to the digital economy and the work they conduct in theirs. So, I’ve been with the company for nine years and that’s where I’m up to.

Michael:         

(02:05) You were or maybe still are associated with the Cognizant center for the future of work and you wrote a book out of that. So maybe you could tell us about your connection with that center and what it is and about your book.

Malcolm:        

(02:21) Yeah, the Center for the Future of Work, we about five years ago launched this. Because we felt we were at this important (Unclear 02:29) and in many ways they are just organized in the wrong way. They’re constructed for the past and aren’t ready for the future.

(02:37) So we decided to look at that empirically to understand what’s going on. We brought together some world class analysts into the group and on top of that work with a number of academic institution with CEAG, MIT, Carnegie Mellon and (Harbin?) Kentucky and have been a number of work projects over the past several years around the issues of our industry structures transforming and also how our company structures in the very nature of the work itself beginning to transform.

Vala:   

(03:13) As you conducted this study can you talk to us a little bit about technology trends that impact the future of work.

Malcolm:        

(03:21) Yeah, I think the largest we all deal with it in our consumer lines. It’s interesting, when I joined this industry over a quarter of a century ago, I probably shouldn’t have admit that at least to myself.

(03:33) But this was where the action was in hi-tech, the cool stuff was happening at scale. It was happening in corporations, and that’s been very different in the past decade. The consumer market has been where the action is and things have been on fire. And that’s been driven by four technologies constructwe see working in parallel. It’s social,Facebook and Twitter are obviously the vanguard leaders of that.

(04:03) It’s been happening mobile and all of these highly mobilized and going to become more and more mobile. Analytics and advanced analytics and what we’re seeing with data science. And the final piece is with the Cloud. And together, social, mobile, analytics, cloud use the acronym The SMAC Stack. I thought it was better than rearranging those letters like with SCAM, that’s not a good way to talk about technology in the market place.

(04:30) SMAC Stack is one that we can all look at it and clearly it’s transformed our personal lives. But now we’re seeing those technologies have a profound impact on company structures and how companies perform in the market place.

Michael:         

(04:47) Now you wrote a book called Code Halos and that talks about digital transformation. So tell us about Code Halos and the intersection with these future at work that you were just describing.

Malcolm:        

(05:01) It stated with the work at the center of the future at work and we were looking at different questions. For example, why didn’t MySpace live against Facebook they should have. Why didn’t Yahoo dominate the way Google has, and we started looking at firms like that, and it quickly led us to this is not an issue for the Silicon Valley wonder kit. These are universal business issues and so that was the first observation.

(05:30) The second and this is where the notion Code Halo comes from, that all of us now live virtual lives as well as physical lives. So we all have a good sense of our physical self, we always have. But now you have a virtual self. Every time you conduct a search, every time you use GPS, the you use a Fitbit of a Kilo band, you are making a digital exhaust.

(05:54) And just think, in the last 24 hour of your life there is a massive amount of digital thoughts that you’ve omitted, you’ve put out there. Some companies have become very good at seeing that and they actually know the virtual you better than the physical you.

(06:11)This is for example, Pandora, with some of your favorite songs and you get hours of customized music coming back at you. It creates little spooky things, where Netflix mat actually know your taste in movies or the movie that you want to see on Saturday night better than your self does. Or Amazon may know your taste in literature better than your sister does. And so because these firms see that digital exhaust where they see your code halo. You code that’s always around each of us now.

(06:44)And the firms that figured this out have started to dominate the markets. It’s the story of Apple. It’s the story of Google. It’s the story of Facebook, Amazon new we’re seeing it in a lot more traditional industries as well.

Vala:   

(07:00) I’m the CMO of Extreme Networks and early last year I decided I’m not going to use resumes anymore to hiremarketeers. I would hire strictly through social media.  I ended up hiring a senior digital marketing through Twitter because I found that the personal brand footprint plus the digital exhaust. And the digital exhaust gave me insights in terms of cultural fit for candidates. You know, boy this person looks great on a resume, but wow what crappy comments he or she leaves on other peoples blogs, and you know it’s not going to be quite a fit, even although they have the credentials. So I think digital exhaust is impacting how  we recruit or how I recruit talent into the business, but also the digital – the purposeful like blogs, community involvement, the slideshares, the Infographics and I’m wondering if you look at the future of work, I personally believe fast forward five to 10 years and the resumes is dead.

(08:04)  Is that something that you think will hit a tipping point at some point?

Malcolm:        

(08:11) There’s no question about it and Vala you made a really important point. We’re going to look at a resume and think what a silly notion that was. Let’s have somebody give their entire life onto one little piece of…

Vala:   

(08:22) …That’s right. Is the captain of the high school team and the acronyms that I need for the automated systems to pick up my resume.

Malcolm:        

(08:31) Exactly. Now that said some things are important. If somebody has a double E from MIT, clearly you trust MIT’s admission process and you trust them as an institution. So that’s something like that still really means something obviously.

(08:47) But doing a resume, it would almost be how many  Friday night Burl Ives did we waste because we walked down the local video store did we decided to watch movie A over movie B because of what was written on the back of that little you know VCR or DVD catalog. So that is really what a resume is. You would never trust a film without going out to its code halo. Meaning what does Cinematch tell you or what do you see on Rotten Tomatoes. You would look at the back and of course, we know what the studio is going to say.

(09:25) That’s the same as a resume now and so you’re exactly right, it’s the code halo above somebody. That’s how you judge talent. That’s how you are going to see or do they fit in your organization and they are voices you really trust. Andin the HR function and the HR supply chain we think that code halos are going to be a really strong impact.

Michael:         

(09:50) So we’re talking about data here. So we’re talking about business and personal lives change as a result of data and so that puts in affect the data science and analytics at the center of how marketing is done. But it’s not just marketing it’s also operations as well isn’t it?

Malcolm:        

(10:14) That’s right. That’s exactly right. I mean look for example at insurance. The insurance industry is the beginning of a real renascence. Look at property and you can get automotive insurance or home insurance, right now that’s done one to many.

(10:31) That is going to become a true one to one marketplace, not based on what actually you think, but actually how you behave. So you basically look at auto insurance today, we’re seeing a real correlation between the data and your credit history, and whether or not you’re going to wrap the car around a telephone pole. There’s real correlation there.

(10:53) That’s just one of hundreds that we’re going to see in the next decade, and it’s going to come through instrumentation. So the next car that you drive will be very instrumented and you can choose which to share that information with by your insurer so they can see exactly how I drive. And if I’m a good driver I get lower rates.

(11:11)The same way with your home. Your home is going to be instrumented. Do you want to share that with your insurer and if they see certain things you can get lower rates as well.

(11:20) So you can see exactly that in those cases that the insurance firm will be inundated with data and they need to figure out with all of that new levels of data coming in, how do they make meaning. How do they see what they really know what they are looking for and make the correlations and provide completely new capabilities back to the consumer.

Michael:         

(11:43) Malcolm, this type of transition that you’re describing that is based on instrumenting your prophecies and instrumenting the interactions and engagements that you have with your customers, and then using that data to drive meaningful results. This is a very different way of thinking, so what should companies do, how do you adopt this type of change mindset and understanding and skills and confidences.

Malcolm:        

(12:20) Exactly, some companies it’s initially very intimidating because they look at the story of what happened with versus (Nopo?) Apple and Google and what happened with Blockbuster versus Netflix and HMsA Cloud. This makes my hair curve. It’s too large it feels, it’s too difficult.

(12:41)There are two areas where it’s starting. One is building that code halo around the individual customer or consumer and are you able to do that. The second area is around if you sell products, instrumented the machine. A good example is with General electric. If you look at their ads now, GE talk about the brilliant machine. What they are essentially doing is putting code halos around they industrial products.

(13:07) They started with jet engines, where they would instrumented the jet engine and showing real-time to the airline customers what’s happening. That has been such a success that they are now committing back to the airlines of more than $3 billion of annual savings.

(13:07) So, in an industry where you can’t check your bag and they won’t give you honey roast peanuts anymore, those savings really matter and now they are doing it with locomotives, power turbines, fat scanners and the rest. So what you see is that they started one part of the business so how it will work, and then started to move it across the organisation.

(13:44) But from an IT perspective it really requires three new skill sets, and the first is design. Let’s face it, most internal IT groups are not known for building beautiful systems. In fact, look at the language that we use, they are built for users, effective users. So how do you instead build these for consumers, who are going to be seeing them on the fly using them on an iPad, using them on smartphone to create compelling, engaging beautiful experiences. The design really matters.

(14:22) A second thing is knowing these SMAC technologies. How do you instrumenting something, what do you do in terms of IOT, how do you build security behind that. There are new skill sets needed there.

(14:34) And then the third that you talked about is on the data, on the data science. Finding those extraordinarily (Math beings?) who understand your systems and the data infrastructure as well and also have a great curiosity about one’s business. Because that’s when you find the correlations is continuously asking questions and in terms of doing that, that curiosity applies through the science and leads to new insights on consumer behaviour or how to put your products together.

Vala:   

(15:04) Well you know I think that answers Michael’s question in terms of how do you do this. I think one, there is a cultural element to this where you have to convince yourself that giving that growing IQ of the consumer and the organisation around you, digital IQ and it probably started augmenting 2007, the smart phone iPhone started that revolution with you know apps, mobile, and social and some of these mega terms you mentioned.

But the power of pull versus the power of push and if you are going to really add up that power of pull. And if you see companies doing that with inbound marketing where they are trying to leverage analytics to create precision marketing, where your delivering content during the buyers journey that can specifically meet the needs of the buyer. But it does require intersection, strong intersection of technology driven marketing. So can you give us advice in terms of you know, as a CMO and strategist for Cognizant, you know, in addition to the skill set that you need in marketing, what are some of the technologies that you need to think about investing to deliver that level of relevant messaging and connections with your customers.

Malcolm:        

(16:21) It’s a great point, you know, the power of pull I think markets are now conversations so now marketing teams need to know how to engage in that conversation. In the past, marketeers with these wild Narcissus that would just talk and talk and talk and talk a little bit more, and they thought that was their job to project the message. That’s not it any more, it’s about how do you – as you said get to that power of pull and that’s by building one to one relationship-based capabilities and treat these aerated, individualised experiences.     

(16:58) And it’s interesting Vala, because a lot of people get concerned about that. They look at their business model and think, that’s too hard, that’s too expensive, how do I scale that. But then you look at what Netflix has done, and what Amazon has been able to do – that’s precisely what they are doing. They are just leveraging technology and a new way to do it.        

(17:20) So the skill sets that are needed this is where you start to get the intersection of some of these new IT capabilities that I was talking about infused with the marketing mindset.  

(17:32) And so you start to build that code halo around the customer and then you also start to recognize what are the cause and factors and what are the relationships between their behaviour and what you sell as a company. So then you can provide the right thing at the right place, at the right time.

 (17:51) To give an example, the life insurance business, we think is another one that can go through significant change, because the model now is agent will come and talk to you and buy you breakfast twice a year. Looking back, I think that was insane. It would be like, hey Michael, how is it going what’s big in your life, I didn’t see you at the last Rotary club meeting. That’s not the way it’s going to work. It’s going to be when you in some ways are bit instrumented, so that they can recognise what’s happening in your life and also the life of your family members around you.

(18:28) And once they see that they can show up in those moments of truth and say, hey have you really thought about this product or that one, it may suit your needs as your life has just changed with the birth of a child or maybe you had a sibling that passed away. Or whatever it may be where you start to reconsider what your life insurance is all about.

(18:48) So we have to get people out of the mindset, I think where they get stuck is where they perceive the business as a physical sense that, gee, to do that many transactions equals this many people as opposed to really understanding how you can scale significantly when you start to digitize a lot of this and start to automate it to work in that platform.

Michael:         

(19:12) So what you’re describing then is a very significant shift in the relationship between the seller and the buyer and this we’ve heard about mass customization for a long time. But now what you are describing is using that data to refine the experience that you offer to down to that segment size of one.

(19:43) And it also connects to changing the business model right, because once you start to do that you have new opportunities. So maybe can you talk about that relationship between the buyer and the seller as well as, and how does this all come together.

Malcolm:

(19:58) It’s a great point and we think there are two areas. One is the customer interface and that’s where mass customization does finally come to fruition. So you know, in the physical economy we tried to do this 100 years ago, and this was Henry Ford’s great gift to capitalism, where he said you can’t do mass customization it’s prohibitively expensive, so you can have your Model T in any color so long as it’s black.

(20:33) That’s been with us now for 100 years, so old habits are hard to break but what’s happening these new businesses – I mean if you consider Apple, Google and Facebook have done, they had this growth of value that’s been unprecedented in history and Michael it’s just what you described  it’s around delivering mass customization.

(20:57)So that’s one area. That’s created a new customer expectation. So the consumer dealing with those firms goes to their local retail bank and they go to an ATM and it says English or Spanish. They go this is crazy, I’ve been banking here for 20 years and you’ve got so much data on me you don’t even know what language I speak.

(21:23) Then you go in and talk to the teller and the teller looks at their systems of record and can see what you have in check in or savings and they ask if you want a new credit card.

(21:32) So that model is breaking down because this new customer expectation of mass customization, so we think that’s one area.

(21:42) The second is in product development cycle. The product development quite often has come from R & D or marketers who are often guessing on things. But when you get this level of imperiousness of what customers are actually buying, what they’re actually looking for. If you actually look inside your data, you can get increasable insights in what should be involved and included in the next generation of your product or the next generation of service.

Vala:   

(22:12) Absolutely. I think about it Michael and my children will probably never walk into a bank. They’re not going to write a check. Their phone will be their wallet. You know you talk about Apple with I.D. technology, NFC technology…

Michael:         

(22:27) But Vala when you say this, you know what I think unprecedented opportunity for thieves to steal everything you’ve got.

Vala:   

(22:34) Well let’s just hope there’s lots of pictures in the cloud – I’m only kidding. But my point is that is just think about the buying experience and the fact that again some of the traditional things we talked about, whether it’s selling insurance or going to a bank or even going to an ATM machine, I mean that some point it’s your phone. And you know you talked a little bit about IOT and those things and you know Granter has projections as much as 30,000,000,000+ connected devices by – IBC’s projections is 200 billion and so fast disagreement in terms. A lot online and in order of magnitude than it is today and whether it is the FitBit or the iWatch or the Google glass.

(23:10) This I think has  not only it dramatically impact marketing, but customer service and support. Where you have your field agents and your customers, your partners can connect in real time with video and can collaborate through social and you know, what are your thoughts in terms of future of work when it comes to connected devices and let’s say service and support as an example.

Malcolm:        

(23:43) Yeah, and around those new different areas it’s going to take off in a B-to-B model in many ways than it is fast than in B-to-C. we hear the jokes about Google Glass, that you know who wears Google (Lester of Ferdy?) it’s a glass hole.

(24:01) It’s all these social connotations in a B-to-C and when you look B-to-B those old musicians just disappear and we see mass just on that alone. Enormous potential for field agents who may go out to repair an air conditioner and they haven’t seen this type of air conditioner before or this particular problem and boom, right there in Google Glass, they can have an expert in the firm guiding them through specifically how to fix it. And so that field agent is getting on the job training. They’re fixing it right the first time.

(24:36) So you can see in just a little case like that, there’s tremendous value in wearables or something like Google Glass in a B-to-B field service connotation.

(24:47) You can have tremendous online impacts, employee retention and so forth and so on. So you’re right. This is moving so fast that people don’t know how to predict it. we just know that it’s going to be really really big.

Vala:   

(25:01) I met a professor at Suffolk University recently and he encouraged the students to text him questions during his lecture to his glass because he felt that some of the students would go to him after class asking him questions that should have been asked during the lecture. And it was a Boston University diverse mix of students. Some of them were uncomfortable asking questions in English or raising their hand.

(25:29) But as soon as he opened up his Glass where you could, you know, send your text it ordered a magnitude more questions and he was able to shape his conversation to meet the students. I thought that was a great example of using Glass to improve education.

Malcolm:        

(25:47) Absolutely, you know there’s many implications. We’re seeing other used cases in education with universities and we’ve all seen this. Some of us lived through this and there is nothing worse than somebody entering the wrong majoring college and getting down on themselves or suffering because you know their parents said no, you must be an engineer or you must be pre-med or whatever it is.

(26:10)  We’re now getting to a case of if both Michael and I hit both the same assignment for calculus and we do it on our computers, and the professor the next day will say, Malcolm, you took two hours on this, and got a lot of them wrong. Michael, it took you 20 minutes and you nailed all of them. Malcolm, maybe you should stick in this major and Malcolm it’s time to fo to Phys-Ed.

(26:34) So you can start to see where that connection with the professor and understanding how somebody learns and where their strengths reside. We are hoping this can really have a revolution in the education process as well.

Vala:   

(26:48) K12 in the US, I believe 5 million Chrome books were sold because of this adaptive learning model because now the professors are assigning the homework in the cloud. And yes, Michael finished it in 10 minutes and it’s the fourth hour and I’m struggling with the module. You don’t need to wait for a test and in a month to know that I need help.

(27:10) You know, Chrome books and K12 in the US, it’s really driven by this contextual intelligence in real time that’s delivered to the instructors and teachers which is transforming how we intrust in success I using cloud and mobile technology.

Michael:         

(27:30) We have a question from Twitter Malcolm and Zachery Jean asks what are the potential roadblocks in the way of one-to-one mass personalization. Hipper, new laws, consumer habits. So what are the obstacles, impediments or issues that are going to slow this transition down?

Malcolm:        

(27:50) Anybody who says this is all going to go to the sky, you have got tremendous skepticism. We’re collectively feeling our way in these markets and I think two things that will slow things down, one is creepiness and the other that is related to it is security.

(28:06) So on the creepy factor – so let’s start with Pandora that’s easy. I give them my information and tastes and what I get back you know is lots of very personalized and very pleasurable  (unclear 28:22) and if somebody finds out that I’m a Led Zeppelin fan well who cares. So the give in that piece isn’t that big. I give you my musical tastes and the give is terrific. I get hours of listening pleasure.

(28:38) But what if you get to something where the give gets bigger and the give is my personal financial information, my personal health information… information about family members and I think suddenly, you start to cross lines where the get (pause in audio) has to get considered.

(29:10) That’s where we’re seeing it. it started in places like movies and books and the rest where people don’t see a lot of downsize with the give. So for example earlier when I talked about telematics with car insurance. Some people are going to say that’s great. I can save a few hundred bucks a year, I’m more than happy to share that information.

(29:24) Other people find this very Orwellian and Vistovian of I don’t really want somebody at a big corporation seeing where my car is and specifically how I’m driving it. they couldn’t think of a worse nightmare.

(29:36) So that’s not worth the two hundred bucks, I’m not going to enter into that relationship. So I think we’re going to have to determine where people are going to be comfortable, or whether or not they’re going to be comfortable.

(29:48) And the second is around security. Look what happened this week with (Bindepot?) look what happened this week obviously with these celebrity photographs, and Michael, we’re still looking for yours!

Vala:   

(30:00) He posts them himself.

Malcolm:        

(30:07) I think we’re going to see more and more of this as we go forward and we talked about it with the online banking example. But you look inside California. We’ve now reached a sessile point where they don’t even talk about bank robberies on the evening news. There are no bank robberies because they happen so often. It’s not news anymore. It’s just part of, you know how society has operated and has reached it threshold at that level of crime.         

(30:35) I think when it comes to more and more of our lives going online, there’s going to be more and more bad activity online and I think that is going to slow things down in certain markets as we start to figure out what is our societal equilibrium. What risks are we willing to incur or the upside that we get from the products or services.

Vala:

(30:59) Is it ultimately that convenience is winning the battle in terms of disemplanted through diligence. I mean, diligence from a marketing perspective. You know, I can use a multi-tenant cloud SASS solution and right at the capability without working closely with IT and you know perhaps lose sight of the fact that integration and processes and compliance that’s required in order to have a robust solution. And this is the shadow IT that we hear about.

(31:30) What are your thoughts about that, and then, marketers higher data scientists and technologists. You know, it seems that you have that need for IT to be more collaborative and flexible. But at the same time make sure it’s a secure and compliant environment.

Malcolm:        

(31:48) Lots and lots of thoughts about them. the first – let me get through what I think is sort of nonsense for conversation. One are these projections of that every company has to have its chief digital officer. I don’t think that is going to come to fruition. I think the chief digital officer should be the CIO. So it’s been an evolution of the IT job as opposed to bringing in a CBO.

(32:13) In some industries in some cases are in split companies that certain starting points may make sense. But as a rule I don’t think that that rule is going to truly take off as some people are projecting.

(32:27) A second is these projections that marketing is going to control more technology budget than the CIO. I think that when the dust settles in five years to find that wasn’t the case.

(32:38) Now, let me be completely clear, will a ton of money be spent on related activities – no question. But as I was sharing I am a CMO myself and Cognizant and were fortune 300 companies, so I do go – recently, I went to one of these CMO hoedowns where we all get in a room and share best practices.

(33:01)And this was midpoint of the conversation, and just what you’re describing, a lot of the CMO’s was like, I don’t want to do that.I don’t know how to manage vendors in that way. I don’t know how to structure. I need to work with all the legacy systems. I need to worry about security. I need to worry about standards, I need to worry about program and project management. I’m the branding guy.

(33:28) Do CMO’s and CIO’s have to work in partnership in a way they never have before. There’s no question about that. but is there going to be true rogue technology, renegade IT where marketing departments just run off and do things. I think they won’t for those two important reasons. The downside around security is just too profound. And secondly, the skill sets that IT has and also all the stuff that has to get integrated into the legacy environment the you really should leverage your professionalism and the capability that’s in the IT department.

Michael:         

(34:06) You know what’s amazing to me about all of this is that we’re talking about taking a business and figuring out. How can we take the best advantage for online capabilities and data.

(34:23) And that’s a very simple question but if the implications cut across that as we were saying you know, the business model, the operations, the competencies the culture. Isn’t that extraordinary that that simple question has such dramatic impact across every aspect of the company.

Malcolm:        

(34:44) Yes. The short answer is yes. The longer answer Michael, in some ways we’re fighting human nature. You do it in your own life. When someone in your family says why did you do that. Well, because I’ve always done it that way and it’s what I’ve liked to do. And even that they add new evidence you still keep doing the same old thing.

(35:09) This is where we see- there’s going to be more between data and HPPO management. Many companies are run by HPPO management and the acronym is the Highest Paid Persons Opinion and in the US we ask why did we do that, why did we do that deal and why did we organize this way, and somebody says, well the (unclear 35:26).

(35:28) As opposed to did we really look at the data and did that lead us to the right answer. When Netflix launched the House Of Cards as a first original programme I think it was a great illustration. They didn’t take the Hollywood approach, the Hollywood approach historically, has been the HPPO approach, but let’s get five people in a room and figure out what to broadcast because they are the smartest people in the room. What’s the old line, nobody knows anything in Hollywood.

(35:59) So Netflix took a normal California approach, which was a techie approach, let’s look at the data and when they looked at their data it told them what the viewers of Netflix want in the old BBC programme, House Of Cards. Nobody would have guessed that on their own, but that’s what the dataset and they created a contemporary American version of it with Kevin Spacey and it proved to be very popular.

Vala:   

(36:25) That’s absolutely true, you know when we talk to other CMO’s that have been on CXOTalk like Jonathan Beckers, CMO of SAP, you know I believe he has 18 to 20 data scientists in marketing working with the marketing automation solutions, the CRM solution, the Sophos listening tools that SAP uses. The community platform and all of that unstructured data there capturing and trying to better understand, how to ultimately and improve their customer experience.         

(37:01) As we live in this experience economy, may be driven by a mobile social analytics and APPS and IOT and others, how important is design in all of this. Designing a user experience or processes, engagement models, where you can differentiate yourself against your competitors.

Malcolm:        

(37:24) It’s incredibly important. So the design has to be at two levels. One is just how somebody interacts with your product. So you can see that with the tools that we use and you have an android device or iPhone and the intuitive, clean, simple, beautiful design. And then there is also business model design. How do I design a new business process to fit with the digital aid.

(37:54) But getting back to the first one, I can share one anecdote with you. It was a client, I can’t name obviously who they are, it’s a big automated manufacture, it’s in the top 10 car companies, I can’t name this company. There CIO referred to it as their intervention, because the CEO, the head of product management, the head of marketing and a few others came and said a few years ago, this was nuts. In this digital world we are trying to sell these cars and we tried to design them to be great, but when somebody is in a machine, literally hundreds of hours a year and all we can tell them is how fast there going and how much fuel they have. It doesn’t make any sense.

(38:38) So how do we create this very immersive personalized experience as if they are sitting in an iPad, how do we create that type of experience. And the CIO and the look was all about design and this is why he and set this way he said, I can’t do that. We can’t do that, we’re the supply chain guys. Were the SAP guys. You know, that’s not what we do and the CEO said wrong answer, and I’m going to give you several months to give me the right answer and if not, I’m going to figure out who else should do this because you are the technology team. So this is where consumer orientated design has to become part of the core competency of the technology team.

Vala:   

(39:25) But is this why, you know when you look at CBO reports, say in 2011 I mean there was 75 CBO’s that will exit this year with over 1000 chief digital officers, is it because CIO’s like the particular one that you mentioned is I don’t know how to take mobile social cloud, analytics, big data, IOT, wearables and deliver a beautiful customer experience.

Malcolm:        

(39:53)That’s why we’ve been tough about CBO’s earlier that you have got your phone exactly why people are turning to CBO’s is that you need to create – you need to design these experiences, number one. And secondly you need to design the business model to deliver them and when there is a void, that’s when folks turn around and say well, well we are behind and nobody is raising their hand and let’s go and get our self a chief digital officer.

(40:25) This is something that if you go inside some of these firms that we have been talking about on this call. You go inside and Netflix and Amazon, they can’t distinguish between the business and the technology. They really are one and the same, yet more traditional industries and more traditional companies they are still part of a state and so anyway that you can get those to come together as quickly as possible, that’s where I think the role of the CBO is in coming forward in some places because of that precise need.

Michael:         

(40:59) You know, it’s interesting we recently had a guest on this show was Charles Phillips, who is the CEO of Infor, and they have designed their business and their business model now based around the foundations of beautiful enterprise software. And it’s not just a matter of attractive pixels on the screen, but as you said it goes to the heart of understanding how do our users interact this software and how do we create a model in a sense that our users will like and to find intuitive and therefore invaluable.

Malcolm:        

(41:43) Exactly you know, as opposed to wasting technology on people and the notion’s in cooperative environments user acceptance training, you know that’s a euphemism for we shall beat you down until you use our stuff. It’s just the opposite. Now this consumer expectation of it must be beautiful and to your point Michael, it’s not just looks beautiful, but it feels like it’s capitalizing what I’m trying to do. It feels natural, even when I think of natural plus, meaning it’s what I want it to do and now I can do even more. So it’s not just beautiful in terms of how it looks at how it behaves and it helps you do your job or whatever you are trying to achieve better, faster, or cheaper.

Michael:         

(42:30) Well you know, we’re just about out of time. This has been an extremely quick 45 minutes.

Vala:   

(42:36) And we didn’t nearly ask all the questions that we wanted to ask because there was some fascinating answers and an unbelievable insight. Thank you very much Malcolm, that was fantastic.

Malcolm:        

(42:47) Great, well thanks for having me.

Michael:         

(42:49) You know when people listening all of this is scripted, think again. We send out a listed basically a discussion topic to the guest and in this conversation we deviated from like hello. Well we got through hello, that was scripted.

Vala:   

Yes, the intros are scripted, but that was a fast fast 40 minutes. You must be having a lot of fun because as your transforming the business and you are doing it for 85,000 employees and of course you have to stay at the leading edge because your customers expect that from you of the services that you provide. So hopefully that’s another book and another appearance on our show in the future, because we would love to keep talking with you.

Michael:         

(43:35) We would love to have you come back.

Malcolm:        

(43:36) Great well I really enjoyed it. Thanks guys.

Michael:         

(43:39) All right, thank you and everybody, we’ve been talking with Malcolm Frank, who is the executive vice president for strategy and marketing at Cognizant. Please join us again next week and I hope everybody has a great week.