The Digital Supply Chain podcast

Winning digital transformation strategies - a chat with Howard Tiersky

April 09, 2021 Tom Raftery / Howard Tiersky Season 1 Episode 120
The Digital Supply Chain podcast
Winning digital transformation strategies - a chat with Howard Tiersky
Show Notes Transcript

My guest on today's episode of the podcast is Howard Tiersky. Howard is CEO of FROM, The Digital Transformation Agency.

Howard is also the author of the Wall Street Journal bestseller Winning Digital Customers - The Antidote to Irrelevance, so I invited him to come on the podcast to discuss best practices in digital transformation, and he did not disappoint.

We had an excellent conversation and, as is often the case, I learned loads, I hope you do too...

If you have any comments/suggestions or questions for the podcast - feel free to leave me a voice message over on my SpeakPipe page or just send it to me as a direct message on Twitter/LinkedIn. Audio messages will get played (unless you specifically ask me not to).

To learn more about how Industry 4.0 technologies can help your organisation read the 2020 global research study 'The Power of change from Industry 4.0 in manufacturing' (https://www.sap.com/cmp/dg/industry4-manufacturing/index.html)

And if you want to know more about any of SAP's Digital Supply Chain solutions, head on over to www.sap.com/digitalsupplychain and if you liked this show, please don't forget to rate and/or review it. It makes a big difference to help new people discover it. Thanks.

And remember, stay healthy, stay safe, stay sane!

Howard Tiersky:

What are the things that your company may be doing today, that actually makes it difficult for your customers to love you, when you move, move those barriers and start to put in the right signals that inspire that customer love, your business can absolutely explode. And there's so many, many case studies and I've done many blog posts on this. There's stuff in my book by so many case studies. And when you look at all the case studies, it becomes more obvious that this is so critical. And so part of my mission in the world and communicating is just to get people to think more about this idea of emotion and love as a hard nosed business topic. Because it really is.

Tom Raftery:

Good morning, good afternoon, or good evening, wherever you are in the world. This is the digital supply chain podcast, the number one podcast focusing on the digitization of supply chain. And I'm your host, global vice president of SAP. Tom Raftery. Hi, everyone. Welcome to the digital supply chain podcast. My name is Tom Raftery with SAP and with me on the show today I have my special guest, Howard Howard, would you like to introduce yourself?

Howard Tiersky:

Oh, absolutely. Tom, thank you so much for having me. Hey, everyone. I'm Howard tear ski. I live here in Mahwah, New Jersey, just outside New York City and with my five kids who've all been cooped up for Coronavirus. So they're basically going crazy at this point. And my passion is working with large brands on helping them with digital transformation. It's such an interesting time we live in the world is changing faster than ever, and companies have to keep up to stay relevant. And that's, that's what I do all day every day.

Tom Raftery:

Superb, superb, how old are your kids?

Howard Tiersky:

My oldest is 19. Okay, she's actually heading back to college in a couple of weeks now again, for the next term. And the rest and my than they they range all the way down to eight. My youngest is eight. He's in second grade. Wow.

Tom Raftery:

Well, tough time for kids. Anyway, we'll we'll we'll move on to actual podcast relevant topics cuz people are tuning into this to hear about digital stuff. Kids are nice, but you know, they don't pay the bills, it's quite the opposite. So.

Howard Tiersky:

But they're right there, my digital focus group about the next generation will get to see what what's really what the next generation of consumers are really going to be like.

Tom Raftery:

Perfect. Perfect. Nice. Nice. Nice, nice. Now you've just written a book Howard has just been published. It's called a winning digital customers. Can you tell me some of the reasons why you thought it was important to write this book?

Howard Tiersky:

Sure. Well, I've had an amazing perspective and opportunity for the last couple of decades, I working with so many large brands around the world, and trying to figure this stuff out, because it wasn't obvious and digital keeps changing. And there's all kinds of challenges to try to help large brands and go undergo the transformation necessary to be successful in this digital world. And so I work with, you know, a certain number of companies every year, but I really felt like, gosh, my team and I have picked up so many hard fought lessons along the way, that it was really time to write them down and share it more broadly.

Tom Raftery:

Okay. And I mean, just leafing through the book there, you've got a whole slew of, you know, references on the inside pages from, you know, organizations like the NFL, Michelle McKenna is saying, Howard Tiersky has been one of my secret weapons, and so on. Did you write all those yourself? I'm just

Howard Tiersky:

amazing. You know, I mostly know but I have to admit that there were a few people. I said, Hey, I'd really love your endorsement, they would say, Can you just write something and I did write a couple of them. But I'll never tell you which one. I didn't write that I would never, I would never write that some of the stuff Michelle wrote, I'm like, Michelle is a little over the top. And she's like, no, that's how I feel. And I'm like, all right, well, thanks.

Tom Raftery:

Brilliant. Brilliant. So what are some of the hard fought lessons that people can take from this book? Don't give them all away because then they won't buy the book!

Howard Tiersky:

Oh, sure. Well, you know what, I'm happy to give them all the way I tell you, I, I publish so many videos and articles, I sometimes feel people must be tired of hearing me. So I feel like I'm on a mission sometimes. So buy the book, or just read all the stuff. It's all good to me. You know, the number one most important lesson is that the answers can all be found in your customer. It's all about driving customer behavior. To me. That's so much of what businesses and if you include in that driving your employees behavior, you're probably at 90% of what makes a business successful. So if we think about our role in running a business is really influencing human behavior, then there's many things we need to do to do that successfully. But the number one thing is to make sure that we understand the people that we're trying to influence because Good luck doing that if you're just guessing. And so about, I don't know 20% of the book perhaps is my very best information on the specific methods to use to To do customer research, and really understand what pain is your customer right now, what are their hopes and dreams? And what are their expectations? And how have those expectations changed? Even before you start to figure out what should we do? How should we change? What new features should we add? What new blog Should we start a podcast or whatever, start by understanding what problems your customer is trying to solve. Because if you can effectively give them solutions to problems, they don't have solutions to or better solutions to problems that they're already trying to solve in some other way. You know, you're you're, you're so far ahead of the game. And I find so many organizations don't do that, or either don't do it as much as they should or don't give the insights they gain the respect or the socialization or the sharing around the organization that they could and then if they did, they would be able to much more accurately aim their efforts.

Tom Raftery:

Okay, and how do you find out what problems your customers have?

Howard Tiersky:

You know, there are a lot of different techniques. One of the ones that I use is ethnography, or observational research. And so just as an example, we like to listen in on calls and call centers, hang out mystery shop, go to go to stores, or stadiums, or obviously different businesses have different places you go. But just as a few examples on my team spent time we were doing we did the roadside experience for triple A American Automobile Association. And so we spent time with it riding in tow trucks, you know, to see when the tow truck driver arrives, what is the experience for the customer? Like, what questions are they asking what challenges they have, and also the driver because we're working not only on improving the customer's experience, but figuring out you know, what's taking the driver longer than necessary to get there? What could we do to empower that driver with better digital tools to make their experience smoother, and make them a better both happier as a driver, but also better able to serve the customer? But I've spent time in, in sports stadiums just watching and observing and my team has, how do people get from the parking lot to the gate? How do they go through the ticketing process? How are they looking for food? How are they finding their seats? Are they getting information they need during a game? And you could do the same thing for and by the way, this is equally true for b2b. We spend time for example, oh, I don't know, so many projects, but like one of the ones we're working on right now is for ADP, which is the largest payroll processing company United States working on the amazing next generation of the interfaces for payroll, people are giving us all their paychecks. Right, we want them to have a good experience, right? We know what those paychecks to be delayed? So how do you observe and understand if someone's doing that work, they have to make sure everyone's paychecks are right. What is their process? Like? What information do they need? What tools do they need? And how can we make that process better? So it's faster, so it's less error prone, just observing, and it sounds simple, but very often from just observing, you get amazing insights. And then there's many other techniques. Sometimes you do that with a number of people. And then you have to try to quantify You say, Well, I've observed 15 people, three of them are having this problem. I'm not sure if that's really, you know, 20%, it may be, but it may just be, you know, the small sample size, it's skewing. And so then you go to more quantitative techniques, like surveys and other things. So and there's so many I talked about a great number of different research techniques. Another is looking at data, you know, understanding. One of the problems that I go into detail in the book about is something we always we have special scripts and algorithms, we used to look at customer data from, for example, digital interactions. And one of the things that we like to look for is something we call circular errors. And a circular error is just when you keep doing the same thing over and over, have you done this? Do you go to a page, and here's, here's what, here's what the server sees. The server sees Tom into this page, and he entered his email, but it was not a valid email. And so I gave him an error. So we entered the same email again. And I gave him that error again. And then he answered that same email a third time, what is wrong with Tom? And I gave him the same error again? Well, I don't need to be observing Tom to know this guy is probably either confused or frustrated, or couldn't be because he's typing his email wrong. But it could be because there's a problem on our system, because you have an email like mine, my company is from digital and our email address and in from that digital, and probably 20% of websites Just tell me that my email is invalid. And it is not, right. And that's just one minor example. But so anytime you see these kinds of error patterns, but you have to look for that, right, you have to have some kind of code that's scouring for this pattern occurring, someone doing the same thing over and over and continuing to get errors. Something's wrong, right? Either your, your instructions are confusing. And so the user is making the same error over and over not understanding it, or your system is bad. And actually the user is correct, and you're incorrectly giving him any anyway, just so those are just a few examples are so many have ways to start to look for that pain.

Tom Raftery:

Okay, and having found problems that, you know, are out there, what kind of digital transformation stories are you seeing amongst your clients?

Howard Tiersky:

Oh, I mean, so, so many. And, you know, small and large, right, for example, we've worked with the Avis budget group for years on improving the car rental experience. And now, you know, you can see, by going through and observing the challenges and roadblocks people hit. And it's not just about Avis, right? You could observe the same things about any travel website and going, ah, how can we make that a little better? How can we people are getting tripped up on the date picker, right, they're clicking the date picker, and there's a problem, let's fix that little problem. People are, you know, not they're confused, by the way we present the vehicle information, or they don't understand the way the prices are laid out, whatever it is, and you fix all these little things. And then all of a sudden, you've got millions and millions and millions of dollars of incremental revenue, because every one of those things might have improved your conversion by point 1%. Which doesn't sound like a lot, but when your site's doing a billion dollars of revenue, you know, point point 1% is many millions of dollars. And then if you can find 10, things like that, and you can 1% I mean, that those couple of percentage points can be an enormous, enormous difference. So you know, in other cases, it's, it's something transformational. It's a whole new product, you know, one example is we work with Universal Studios, theme parks. And one of the things that came out of the customer research that we did, historically, in theme parks have a lot of proprietary merchandise, you go there and there's stuff, you can buy souvenirs that you can buy it like the toy store near you. It's specific to the theme park. And there's a historical mindset about theme parks that well, that's one of the reasons that that's sort of a draw of a theme park, we have all this unique merchandise. But what we learned from the research is that a lot of people, they want to buy more stuff, they don't buy as much stuff as they'd like to either because they don't want to carry it around the theme park or they don't really know they're walking through the theme park and they see something they like, but then they think, well, maybe I'll see something better later. And then they find something and then later, they wish they bought the thing, but it's on the other side of the park. And they don't want to walk all the way back or take the tram. So it led to the idea that there should be an e commerce store where people could order that merchandise don't only have to buy it. And it seems like an obvious idea. But it was not really naturally part of the way that the theme park industry thought, right? So out of our research came this whole new business opportunity, which turned into, you know, an e commerce store to buy all this merchandise. And that's now become a major source of revenue for that theme park. That incremental because again, and furthermore, customer convenience, because again, it didn't put the customer in the situation of do I buy this giant stuffed animal and carried around all day? Or do I run the risk that I won't be able to get it? Because later I won't I won't see it, you know, I was near the at ride, right? They don't sell the stuffed animal on the other side of the park when you're at Back to the Future, whatever.

Tom Raftery:

Okay. And is there some, is it a mindset change that's required for companies to become more customer centric? Or is what what's involved in doing that?

Howard Tiersky:

Yeah, yeah, I do think it is a mindset change. And, you know, a lot of companies use this, this idea of being customer centric. It's like a buzzword, right? Oh, we're gonna be customer centric. And, and, and the thing is, you know, one of the things I talked about in the book is what does it actually mean to be customer centric? Because all companies have customers.

Tom Raftery:

And all companies say they're going to be customer centric. So how do you measure that?

Howard Tiersky:

Yeah, yeah. Well, I think like you say, I think it starts with mindset. And the mindset is, what do we really how do we, what is our priority in terms of how we adapt to meet a changing world? And, you know, if you're and you know, one way, I like to think about the idea of asking the question, are you customer centric, saying, well, what's the alternative? Because our companies have customers, nobody's arguing whether we should have customers, right? Like, that's never the conversation. Customers are good. I don't think anyone's taking the opposite argument in that debate. But the question is, are they the priority? And so one thing I like to point out, it's okay, well, there are some alternatives. There are many businesses that are not customer centric. So what are that? And I usually I find, they're either product centric, or they're channel centric. So a product company would be a company like Kodak. Kodak was a film company, right? And as the world changed, and everyone adapted digital cameras, what did Kodak say? Did they focus on digital cameras? I mean, they did a little bit, but not really, right. They didn't really, they invented the digital camera, but they didn't really go after that market because it didn't go with their sense of identity because they were a film company. And what do they do today? I mean, film, right. There are still esoteric applications for film and when you want film, they're the place to go. Obviously, they wrote that they wrote that ride all the way to the bottom? Yeah, um, so that you know, versus a company like Apple that, you know, drops computer from their name because they realize that while they still sell computers, their computer business is eclipsed by phones and other things, software, you know, music, there was a time I'm sure at Apple, where someone said, Why are we creating a phone? We're a computer company, you know, this doesn't make sense Motorola or Nokia, they're the leaders in phones, right? Remember those guys? Like, where are they now? Right? And why is Apple, the computer company creating a phone? So to your point about mindset, you have to be able to transcend that mindset that says, This is what our identity is as a company and instead say, wait a minute, where is our customer going? We need to follow our customer there. And you know, I think that's, that's the key difference. Okay.

Tom Raftery:

for customers who are sorry, for companies who are, you know, thinking about starting out on this kind of journey? What should be their first steps?

Howard Tiersky:

I think the very first step is to get clear on what is your purpose as a company, fundamentally, what are you there to do? And how does that transcend your existing product line, or your existing experience? And, you know, it's the classic kind of business school example, where, you know, Western Union wasn't interested in the telephone, right? Or the great rail lines didn't want to talk about air travel, because they're like, we're, you know, we're a rail company, instead of seeing themselves as a transportation company, right. And everyone this is, everyone gets taught this stuff in business school, you know, but I think that's the first step is to say, beyond literally what we do today. What is the mission that we have? What problems are we trying to solve for people, if you think of your purpose as a company, not in terms of your solutions, but in terms of the problem you solve, because not every company is trying to solve the same problems. One company is trying to educate America and other companies trying to feed America and other trucking companies trying to keep them healthy? I mean, these are not the same thing, right? So it's not about doing everything. But if once you say, Well, our job is to, you know, whatever, right, keep people healthy, or make people feel cool or happy or empower people with tools to unleash their creativity like Apple does. Once you understand what that is, then you have to ask yourself, well, what's stopping our customers? Right? Why aren't they accomplishing that today? And that leads you to the problems, and then the problems, you know, typically lead you to the solution. So I think you start with understanding what's the fundamental problem space that your brand is focused on? And then, and then it's what we talked about earlier. And then it's the customer research, we like to create what we call a pain map. Once we understand all those problems, to map out to all the stages of the buying lifecycle, what are the challenges and obstacles that that customer face? So if it's rental car, what are the challenges they face in deciding whether to rent a car, and reserving a rental car and picking up a rental car using a rental car and turning around a car, right? Or, and you could do this for any any kind of experience or relationship. And once you're clear on all those problems, man, it's amazing how quickly it comes into focus, because the solutions then just become about? Well, sometimes the solutions are obvious. Sometimes once you understand the problem, clearly, it's not hard to come up with a solution. And other times, you know, you need research new technologies to say how could we apply? Is there a way to apply AI or machine learning or drones or virtual reality or whatever it is, but now you're now you're applying a technology to solve a problem, instead of what a lot of companies do is they say, Well, here's a really cool technology for sure, we should be using this now, what would be a problem we could solve with this, you know, as like a doctor showing up at your door and saying, I've got this antibiotic, I need to find something wrong with you that I can use this antibiotic for, you know, maybe you need the antibiotic, but maybe not. Instead, you start with the diagnosis, and then you figure out what's the intervention?

Tom Raftery:

Okay. I mean, this is the digital supply chain podcast. Is there anything specific to supply chain that you'd recommend to folks?

Howard Tiersky:

Well, absolutely. And and, you know, I know that you and I have chatted previously about like, what is supply chain? Right. And so some people historically think of supply chain is looking upstream to the to the suppliers of the raw materials or other services that you need in order to serve your customer and others see, the more competent, I think SAP would tell me if I'm right sees the more comprehensive vision of the supply chain, which is all the way from raw materials to customer value your customers value correct. So I would say, let's look both directions. If I look upstream, if I say, Well, you know, how can digital transformation impact those that supply my company with what I need to then deliver to my customer? I would say well, well, first of all, we see many of the most successful companies, the companies that are creating the most value creating, you know, the most rapid growth and valuation increase our platform companies. And if you look at somebody like an Airbnb or an Uber or or, you know, an Alibaba, they have a totally different approach to their supply. Right, instead of instead of trying to purchase things and own them and transform them, they're creating a platform where suppliers and their customers can connect together. So it's the ultimate sort of frictionless or nothing's truly frictionless, but lower friction suppliers. So that's one angle. But even if you're in a more traditional, let's say, manufacturing business, and you have still, you know, a non transformed process where you have to find suppliers, and you buy raw materials, and maybe you make something, thinking about how you can be a preferred customer, to those suppliers is potentially a huge competitive benefit. When you have a great relationship with those that are supplying whatever it is that you need, you're in a much better position to help them to get them to innovate for you to get them to customize for you to give you differentiation to get you get in to provide you prefer, you know, when when, when certain raw materials may be in high demand to get a larger percentage of the available supply? There's all kinds of reasons why looking upstream to your supply chain, and thinking about the same exact question, what is their pain? What is the pain of the supplier of my raw materials, because if I can be a better solver, that obviously they want to sell them and make money, but everything from my payment terms to by ordering process to the way in which I make them look good, by the way, my their product is used and I product are all opportunities. And there's many more to understand how you can be a better solution to their pain than maybe another customer compete for your suppliers. And then if you look in the other direction, if you look downstream and say, Well, what about the other part of the supply chain? Of course, it goes to so much of what we just talked about, how can I create a better experience, it makes my job easier for my customer to find me easier for my customer to understand why they should purchase my product easier to purchase the product, more insight into the product is delivered, easier to get sales support on all those components that make up the whole customer journey.

Tom Raftery:

I ran a couple of businesses back in the day, and I always used to say make it easier for the customer to give you money. And that will take away so many barriers that will make it so much easier to do business with them.

Howard Tiersky:

Absolutely, absolutely. It's amazing how often we find usability problems on the checkout screen. And it's like, Oh, geez, you know, just like you say, they're literally trying to give you money right now and they're encountering problems. I mean, this should be your number one business priority. Do not stop people when they're trying to give you money for God's sakes. Exactly.

Tom Raftery:

Exactly. Howard, we are coming up on the end of the podcast now is there is there anything I have not asked you that you wish I had, or any topics that we've now brought up that you think it's important for people to be aware of,

Howard Tiersky:

you know, one thing that I often talk about it goes, you know that there's a there's a heart on the cover of my book, many customers, you know, and this idea that our emotional connection with our customers. And I would even to the point of you said about supply chain, I would even argue it goes back to our suppliers. I mentioned earlier that that I believe so much of business is about driving behavior, and begs the question, well, what really drives people's behavior? And the answer is thoughts and feelings. But more feelings than thoughts. You know, there are many studies that show that that people are tend to be tend to make decisions emotionally and then rationalize them intellectually. And so I think every business needs to be asking themselves, how can I be loved by my customer? If you look at those companies that are most successful today, those brands that everybody wishes they were their customers love them

Tom Raftery:

Sure.

Howard Tiersky:

Now, not everybody loves them. Not everybody loves Google, or Facebook or Amazon. But those aren't their customers, right? But their customers in large numbers love them Apple, obviously, Disney it's not only digital brands, right? And so how do you inspire that customer love, I think this is not a sufficiently talked about concept in the boardroom. Because when you have that level of customer love, that's an unbelievable asset. And so this is another thing that I go into great depth in my book as well. What do we mean by that? What is customer love? What are the components that inspire it, because you can dissect it, it sounds a little clinical to say, well, let's take love and let's reverse engineer it. That's exactly what we what we what we've done is to say, Well, there are things that inspire and trigger love. And there are things that that cause it to go away. And so how do you understand what those things are in your customer, it has a lot to do with things like meeting their needs, delighting them, and resonating with what you stand for, and having that seem relevant to the customer. And I know we're out of time. So we'll go into detail now. But really getting a clear strategy for what is your company doing to inspire customer love and to the pain stuff we talked about earlier? What are the things that your company may be doing today, that actually makes it difficult for your customers to love you. When you move, move those barriers and start to put in the right signals that inspire that customer love, your business can absolutely explode. And there's so many many case studies and I've done many blog posts on this and there's stuff in my book by so many case studies, when you look at all the case studies, it becomes more obvious that this is so critical. And so part of my mission in the world and communicating is just To get people to think more about this idea of emotion and love as a hard nosed business topic, because it really is

Tom Raftery:

nice, yeah I kn w, customer, evangelists are th best evangelists.

Howard Tiersky:

Yes. Right? Because they're genuine, right? Because you see that that, that you see that they have been moved? There's nothing more moving than somebody who has been versus, you know, advertising. Look, people are so cynical about what companies say about themselves. Yeah. It's the only value in advertising is to inspire doubt. I think this is the only value in advertising. Doubt is at least recognition. If you tell people, we're the friendliest airline on Earth, what you're gonna get is doubt. But at least people heard Yeah, these guys claim to the friendliest airline on Earth, which is one step better than I never heard of those guys. But then you still have a long way to go to convince them that you're the friendliest airline on Earth, just because you told them that, you know, they don't believe you, they just know that you're some some somebody who's making is making a likely false claim. That's one little tiny step up from the bottom, and then you got a lot more distance to go. And that distance has to be largely bridged with a combination of customer experience, and evangelism, because people do believe what they read in reviews, and they do believe what other customers say.

Tom Raftery:

Great, great. Howard, that's been fantastic. f people wanted to know more bout yourself, or about your ook, or about any of the topics e talked about on the podcast oday, where would you help me irect them, of course.

Howard Tiersky:

So if they want to learn more about my book, you can go to winning digital customers dot com and you an actually download the fi st chapter of the book for fr e, buy the book at a spec al discount price, etc, etc. So we'd certainly want to encour ge everyone to do that. If yo 'd like to learn more about my company, which is a des gn agency and consultancy cal ed from Digital, you can get to us at from dot digital, which i a real URL. You don't need the. om Please tell tell your frien s. That's probably enough. But ou can also find me on Linked n, Twitter, YouTube, and all he usual places by searching or spectacul

Tom Raftery:

Howard. It's been great. Thanks a million for coming on the podcast today.

Howard Tiersky:

Oh, my pleasure. It's been a lot of fun time.

Tom Raftery:

Okay, we've come to the end of the show. Thanks, everyone for listening. If you'd like to know more about digital supply chains, head on over to sa p.com slash digital supply chain or, or simply drop me an email to Tom Raftery at sa p.com. If you'd like to show, please don't forget to subscribe to it and your podcast application of choice to get new episodes as soon as they're published. Also, please don't forget to rate and review the podcast. It really does help new people to find the show. Thanks. Catch you all next time.