Business Chief Canada – May 2019

CANADA EDITION MAY 20 19 canada.businesschief.com

EMBRACING DIGITAL TRANSFORMATION

CONNECTED FLEETS THROUGH IoT

L A T I G I D E V I S O AN EXPL N O I T A M R O F TRANSE MARKLE ON HOW INNOVATION WILL CE O S T E V F GROW T H O E S A H P T X E N E H T E DR IV

City Focus

WINNIPEG

The high-tech transport hub

FOREWORD

W

elcome to the May issue of the Canada edition of Business Chief.

This month’s lead story features one of North America’s leading eProcurement companies, BirchStreet Systems. CEO Steve Markle discusses the company’s remarkable growth in the eProcurement sector and its plans to continue expanding over the coming years.

“We’re really entering into a hypergrowth phase,” says Markle. “We really force companies to look at themselves and evaluate whether their processes and their internal capabilities are fit for where they want to go as an organization.”

You can also read Business Chief’s interview with IGM Financial, a leading global wealth and asset management company. Milorad Stefanovic, VP of Digital Technology, discusses the company’s strategic digital transformation.

Elsewhere in the May issue, we speak with Largo Resources’ COO, Paulo Misk, who discusses the company’s record year and future plans to become the world’s leading supplier of high-quality vanadium.

Additionally, Chantier Davie’s Jeremy Citone reveals how Canada’s largest shipbuilder is using technology to connect a shipyard the size of a small town.

This month’s City Focus explores Winnipeg’s James Armstrong Richardson International Airport, the high-tech transport hub helping put the city on the map.

Do you have a story to tell? If you would like to be featured in an upcoming issue of Business Chief Canada, get in touch at harry.menear@bizclikmedia.com.

Enjoy the issue!

Harry Menear

w w w. b u s i n e s s c h i e f. c o m

03

CANADA EDITION EDITOR-IN-CHIEF

HARRY MENEAR MANAGING EDITOR

OLIVIA MINNOCK

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CONTENTS

10 BIRCHSTREET SYSTEMS:

EXPLOSIVE GROWTH: NEW INNOVATIONS, NEW GEOGRAPHIES, NEW INDUSTRIES

32

42

Information Builders: A new chapter in business intelligence MAKING THE CASE FOR CYBERSECURITY INVESTMENT

50 How to win the war for skilled talent

BRINGING GREENER CITIES TO LIFE THROUGH CONNECTIVITY AND INNOVATION

62

74 City Focus

WINNIPEG

84 TOP 10

US universities for business

110 Chantier Davie Canada Inc.

98 IGM Financial

124 Largo Resources

142 Sprint Corporation

174 Affinity Plus Federal Credit Union

206 Vantage Drilling

192 Alliant Credit Union

224 Danone

238 TC Transcontinental

252 TE Connectivity

10

EXPLOSIVE GROWTH: NEW INNOVATIONS, NEW GEOGRAPHIES, NEW INDUSTRIES WRITTEN BY

HARRY MENEAR

M AY 2 0 1 9

PRODUCED BY

ARRON RAMPLING

11

w w w.busi ne ssc hief. com

BIRCHSTREET SYSTEMS

STEVE MARKLE, CEO OF BIRCHSTREET SYSTEMS, DISCUSSES THE NEW INDUSTRIES, NEW GEOGRAPHIES AND NEW, INNOVATIVE PRODUCTS DRIVING THE NEXT PHASE OF GROWTH FOR THE COMPANY

O

ver the past 17 years, BirchStreet Systems has emerged as the leading provider of Procure-to-Pay (P2P) solutions for

enterprises operating in the hospitality space.

P2P is comprised of solutions which automate procurement, accounts payable, invoice & payment 12

processing, inventory management, recipe management and capital expense management.

These solutions can deliver up to 20%-50% back office and food and beverage cost reduction, and achieve over 80% on-contract spend compliance rates, improving rebate capture. With best-of-breed solutions and strong value proposition, BirchStreet is poised to enter its next phase of expansion.

“We’re really entering into a hyper-growth phase,” says CEO Steve Markle. BirchStreet counts such premium hotel brands as Marriott, Hilton, Hyatt, Accor, and Four Seasons among the enterprisewide users of its suite of SaaS on-demand solutions. Markle continues, “having captured most of the major global hotel brands, and a large percentage of the large hotel management companies as enterprise customers, BirchStreet is preparing to M AY 2 0 1 9

13

scale its operations dramatically. We grew in excess of 40% in the last year and can see that growth trajectory continuing for the foreseeable future as we deploy into our customers’ property portfolios, grow alongside our rapidly expanding customer base and acquire additional large enterprise customers. Moreover, we have our sights on growing the company by many multiples in the next few years.�

Following two years as BirchStreet COO, Markle, has served as CEO of BirchStreet since July 2018. In our w w w.busi ne ssc hief. com

BIRCHSTREET SYSTEMS

“ W E HAVE OUR

SIGHTS ON GROWING THE COMPANY BY MANY MULTIPLES IN THE NEXT FEW YEARS” — Steve Markle, CEO, BirchStreet Systems

geographies through its existing customer base of global brands and an enhanced international selling organization. “Our third growth vector is the new suite of products we have recently developed in our roadmap, which is really exciting,” he continues.

“These solutions go way beyond traditional e-procurement.”

These three elements of BirchStreet’s transformation and growth journey are best illustrated by one of the company’s newest clients, Wynn Resorts. “Working closely with Wynn over the past year, we are quickly

14 sit-down session, Markle outlines an

approaching their goal of becoming

ambitious plan to match the company’s

truly paperless,” says Markle. “Having

bold, dramatic growth targets, sharing

recently gone fully live on BirchStreet,

his vision for BirchStreet’s continuing

Wynn is not only automating its P2P

transformation into a diverse and

processes, but is also utilizing nearly

disruptive global organization.

every tool that we have to eliminate

“There are three major vectors of

paper. Like we did by working with

growth that put BirchStreet into

the leaders in the hotel space in our

context,” explains Markle. “First, we

early years, Wynn has partnered with

are more deeply penetrating our

us as an early adopter to create

traditional hospitality industries, as well

state-of-the-art solutions for the

as entering new industries that are

gaming industry. Innovation through

similar because of the adjacent Food &

collaboration has been the hallmark of

Beverage and direct goods categories

BirchStreet’s development from our

that they share.” Second, BirchStreet is

earliest days as a transformative

rapidly expanding its footprint in new

company”, he explains.

M AY 2 0 1 9

CLICK TO WATCH : ‘BIRCHSTREET CUSTOMER CONFERENCE 2018 HIGHLIGHT FILM’ 15 This new partnership is allowing

BETTER SERVING LONG-TIME CUSTOMERS

BirchStreet to further its penetration of

Over the past 17 years, BirchStreet has

the hotel and hospitality vertical.

continuously sharpened its ability to

Furthermore, it demonstrates that

increase spend visibility & control and

BirchStreet is making a decisive

operational efficiency to significantly

entrance into the gaming, restaurant,

cut costs for its clients in the hotel

managed foodservice and sports &

space. This singular focus on reducing

entertainment events spaces, evi-

the cost of procuring from and settling

denced by customers such as Levy

with their suppliers has resulted in

Restaurants and Delaware North.

BirchStreet capturing the 14,000

The company is also launching a host

businesses that it now claims as its

of new products in order to smooth

customers. BirchStreet’s importance

and improve the operating processes

was cited by AccorHotels CPO

of a world-leading institutional food

Sebastien Brunel in a recent interview

service brand.

with Business Chief. “BirchStreet brings w w w.busi ne ssc hief. com

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We enable automated but personalized interactions across our applications via digital assistants—and we’ve integrated AI into analytics to help discover hidden patterns.

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PATHWAYS TO INNOVATION Oracle uniquely offers multiple paths and services to facilitate a customer’s move to the cloud. Our cloud strategy is built on the understanding that cloud and on-premises implementations must coexist.

This gives customers a path that meets their future needs while allowing them to preserve and upgrade their existing investments. With free trials and our “bring your own license” and “universal credit pricing” programs, Oracle makes it easy for organizations to try, buy, and consume cloud services while leveraging existing Oracle investments. And Oracle Soar, the world’s first automated cloud migration offering, enables customers to save time and resources. As part of our commitment to customer success, Oracle offers world-class consulting, support, and training.

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Learn how Oracle is continuing to innovate by watching Oracle Sets New Standard with World’s First Autonomous Database. You can also learn about the value that Oracle provides growing companies by visiting oracle.com/proofinnumbers.

BIRCHSTREET SYSTEMS

CLICK TO WATCH : ‘BIRCHSTEET OVERVIEW’ 18 structure to our process. We have PO

Elaborating further on the value that

approval process, PO management,

BirchStreet brings to its customers,

inventory management, product

Markle says, “There are three big

management and (electronic) interac-

sources of economic value that

tion between (our) hotels and (their)

BirchStreet brings to these organiza-

suppliers. This is essential for AccorHo-

tions besides increased efficiency. The

tels, especially in North America,” he

first big driver is spend control which

explained. “We have been partnered

enables big savings by allowing their

with BirchStreet for 10 years; they’ve

operations to go through a controlled

always supported us in everything

online buying experience that ensures

we’ve done and the platform brings

the properties are buying the right

efficiency, good savings and automatic

goods, from the right supplier, at the

updates to inventory – we probably do

right price.” Second is the prevention

around US$150mn of annual spend

of risks like maverick or off-contract

through the BirchStreet platform.”

buying, and third, BirchStreet’s

M AY 2 0 1 9

platform creates value for its

enterprise customers, rebates and

customers on the revenue side.

allowances add up to big dollars.

“You can increase revenue with us

Our value proposition is amplified

by having tight and efficient controls

when our solution is coupled with a

over your inventories so that you never

Group Purchasing Organization

miss an opportunity to make a sale,”

(GPO) like the one offered by our key

Markle explains. “Suppliers offer

partners at Hilton Supply Manage-

rebates and allowances if you achieve

ment” (HSM), says Markle. “With

certain spend levels with them. Our

HSM, BirchStreet can approach

system automatically tracks all of the

customers in any of their target

spend with each supplier so that the

industries or geographies with

customer can easily capture the

a seamlessly integrated offering

rebates and allowances they earn.

combining P2P technology and

Given annual spend size of our large

supply chain programs” 19

E XE CU T I VE PRO FI LE

Steve Markle, CEO Steve brings over 20 years of technology and business leadership.

His responsibilities include driving the strategy and execution of the company. In addition to Markle’s role at BirchStreet, he will continue as an Independent Director on the Board of MarginPoint, a leading Inventory Management SaaS company. Prior to BirchStreet, he was Vice President and General Manager, CLM and SRM for Apttus, the category-defining Quote-to-Cash software provider. Markle was founder and CEO of BuildBeam, job management software designed specifically for specialty trade contractors (acquired

by DaftLabs). From 2001 until 2013, Steve was an executive at Ariba (acquired by SAP), a pioneer in Sourcing, Procurement and Business Network space where he ultimately served as Vice President of Solutions Management. Markle earned his BSE in Mechanical and Aerospace Engineering from Princeton University.

w w w.busi ne ssc hief. com

BIRCHSTREET SYSTEMS

NEW PRODUCTS A specific example of how BirchStreet is better serving its existing customer base, while also aggressively expanding into new markets, is the adoption of innovative new products that greatly enhance the efficiency of its customers’ operations. According to Markle, from its earliest days BirchStreet’s focus on the P2P function within the hospitality industry has defined the development of its software platform.

“We recognized early on that the large ERP software companies are excellent 20

2002

Year founded

300

Approximate number of employees

200,000+ Registered Users

at meeting generic enterprise management software system needs. But with its emphasis on food & beverage and other items consumed in delivering its ‘product’, or what we call ‘direct goods’, hospitality has very specific needs that were not being met. There are numerous “pain points” in the P2P process that are specific to hospitality and BirchStreet is uniquely positioned to address those needs. We integrate with all the major ERP systems thereby completing the full ERP functionality required by our large enterprise customers”.

“Two years ago, we acquired AccuBar, a best-in-class, specialist M AY 2 0 1 9

Processing

25mn

Purchase Orders a year

solution provider, for businesses that handle beverage inventory,” says Markle. Since acquiring AccuBar, BirchStreet has combined both companies’ capabilities to create a single inventory management solution for food and beverage organizations.

“It’s very slick,” Markle says. “It has mobile capabilities that allow you to receive goods with your mobile device when it reaches your dock. This is a critical part of the process that enables flow-through automation from receipt to pay. In addition to promoting accuracy in the receiving process, it saves a huge amount of time versus writing things down by hand and then entering data into your accounting system.” Another example is BirchStreet’s investment in infrastructure for global scale. All of BirchStreet’s customer transactional data runs on Oracle databases. By leveraging Oracle’s technology, BirchStreet is able to host more than 2mn logins per month while maintaining a 99.9% uptime. BirchStreet also embeds Softlinx services to send over 50,000 fax pages per month on behalf of its customers to the corners of the globe without internet. By switching to w w w.busi ne ssc hief. com

21

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“ W E’RE SAVING OUR CLIENTS SO MUCH MONEY BY ENABLING THEM TO GO THROUGH A TIGHTLY MANAGED ONLINE BUYING EXPERIENCE” — Steve Markle, CEO, BirchStreet Systems

of liquor and wave it in front of your mobile device,” Markle elaborates. “Our mobile app will recognize the shape of the bottle and branding and allows you to take inventory, including partial bottle inventory by moving the fill-line on the bottle image that automatically appears on your mobile screen. Think of the more expensive scotches, or a bottle of Remy Martin Louis XIII Cognac and you quickly understand the power of this quick, easy and accurate inventory management tool.

You potentially have a lot of capital locked up in beverage inventory,

Softlinx in late 2017, BirchStreet

particularly when you consider the final

increased its worldwide success

selling price per pour.” Expanding

rate by 20%. And through BirchStreet’s

further on this proprietary technology,

partnership with CapGemini, the pair

Markle continues: “Once you have the

offers Accounts Payable as a Service

contour of the bottle saved to the

(ApaaS) to joint customers such

system – and some weirdly shaped

as FourSeasons. APaaS is a fully

bottles are hard to calculate by eye

standardized and automated

– our patented technology always

business process for end-to-end

recognises the shape of the bottle. All

invoice process.

you do is swipe your finger where the

In addition to automating the goods

liquid line is and it’ll automatically

receiving process, BirchStreet

calculate how much volume you have.”

provides its customers with a patented

Markle maintains that BirchStreet’s

specialized inventory function. “The

inventory software has the potential to

service’s unmatched take-inventory

revolutionize waste mitigation in

capabilities allow you to grab a bottle

high-value beverage management. w w w.busi ne ssc hief. com

23

BIRCHSTREET SYSTEMS

24

Responding to the needs of its

restaurants manage recipes and

institutional food services clients, the

ingredients, as well as food costs,

company is also introducing innovative

which is the Holy Grail for business

software to help its food production

owners and chefs. Then, if you

operations track stock and ensure

combine recipes with inventory, our

standards of service across multi-loca-

solution will implement automatic stock

tion operations. “For managed food

replenishment notifications or fulfil-

service companies, we’re also

ment of that inventory item depending

introducing our recipe and production

on the recipes you produce. Just think

kitchen modules,” says Markle. “Think

of the labor savings from automating

about how many recipes a large casino

that aspect of food services opera-

or hotel must have and the process of

tions. If you think about a high-end

making and distributing finished goods

casino property, you think of shops on

to their outlets. Our solution helps

the first floor where they’re selling a

M AY 2 0 1 9

where it also hopes to attract a new roster of clients. “We’re making a very large bet on Europe, the Middle East and Asia,” says Markle. “By all indications it will be wildly successful. There are lots of companies within both our old and new industries that operate outside BirchStreet’s traditional market of North America.”

As BirchStreet breaks into new sectors and brings new offerings to new and old customers, Markle reflects on his own schedule. “I’m traveling around the world three or four times a year,” he says. “I’m about to do an around the world trip, starting in early March. I’ll just keep going East until I wind up back in wide range of items. Working with

California.” Markle holds town halls with

our customers has allowed us to

employees in every BirchStreet office to

create a retail inventory extension of

keep the company engaged and

our inventory module functionality,”

updated on the next stages of its

says Markle.

development. “Change is constant, and you manage change by making sure

NEW MARKETS, NEW REGIONS

your organization knows where it’s

BirchStreet’s new suite of products are

going and embraces the enthusiasm

allowing the company to aggressively

of its leaders.”

penetrate adjacent or nearby indus-

On the subject of BirchStreet’s

tries. Furthermore, its deeper penetra-

legacy as well as his own, Markle

tion into the multi-national hotel

muses: “We look at our industry of

management sector is allowing the

hospitality as we would any business

company to explore new regions,

that provides a ‘product’. Our customers w w w.busi ne ssc hief. com

25

End-to-End End-to-End End-to-End YOUR ONE-STOP PROCUREMENT PARTNER YOUR ONE-STOP PROCUREMENT PARTNER Hilton Supply Management works with over 2,000 suppliers to manage YOUR ONE-STOP the entire supply chain from farm to Hilton Supply Management works PROCUREMENT PARTNER restaurant, manufacturer room and with over 2,000 suppliers toto manage

project to completion.

We the entireinception supply chain from farm to provide sourcing for 8,000 properties restaurant, manufacturer to room and Hilton Supply Management works (including more than 1,800 non-Hilton project inception to completion.

We with over 2,000 suppliers to manage hotels) leveraging massive economies provide sourcing 8,000 properties the entire supplyfor chain from farm to of scale, competitive contracts with (including more than 1,800 non-Hilton restaurant, manufacturer to room and top suppliers and substantial savings hotels) economies projectleveraging inception massive to completion.

We for hotels. of scale, competitive contracts with provide sourcing for 8,000 properties top suppliers andthan substantial savings (including more 1,800 non-Hilton To learn more about joining the Hilton for hotels. hotels) leveraging massive economies procurement program please contact of scale, competitive contracts with us at HSM@Hilton.com.

To learn more about joining thesavings Hilton top suppliers and substantial procurement for hotels. program please contact us at HSM@Hilton.com.

To learn more about joining the Hilton Prototype Custom Operating procurement program please contact Décor Procurement Supplies Packages us at HSM@Hilton.com.

Custom Procurement

Custom Procurement

© 2018 Hilton

© 2018 Hilton

© 2018 Hilton

Prototype Décor Packages

Prototype Décor Packages

Operating Supplies Operating Supplies

PA R T N E R S

BirchStreet and Hilton Supply Management (HSM) partner to offer integrated P2P SaaS technology with supply chain programs. HSM’s programs can save up to 61% depending on the commodity purchased and BirchStreet’s technology enforces purchasing compliance to ensure that value is captured.

All of BirchStreet’s customer transactional data run on Oracle databases. Oracle is the leading database software manufacture and handles which lets us handle more than 5,000 per second.

By leveraging Oracle’s technology BirchStreet is able to host more than 2 million logins per month while maintaining a 99.9% uptime.

27 BirchStreet and Capgemini have partnered to offer Accounts Payable as a Service (APaaS), a solution offering a centralized mailroom function, process standardization, all integrated using Optical Character Recognition (OCR) for invoice capture with BirchStreet P2P as the underlying technology platform. These two leaders in hospitality, joined hands to create customer value through these shared services and help clients like FourSeasons realize savings up to 40-50% in operating costs and rapid profitable growth.

BirchStreet uses Softlinx services to send over 50,000 fax pages per month on behalf of our customers. By switching to Softlinx BirchStreet increased our worldwide success rate by 20% while cutting costs by 10%.

w w w.busi ne ssc hief. com

BIRCHSTREET SYSTEMS

are enterprises that manage multiple facilities that deliver a wide spectrum of services that make up their ‘product’.

The hospitality ‘product’ is effectively made up of parts and labor. We partner with our customers in multiple ways to significantly reduce their labor costs and increase sales. We do this through automating a whole host of manual processes from procuring to paying for the goods they use at their properties day in and day out, and we provide the tools needed to better manage the ‘parts’ used in their food 28

and beverage operations, as well as in the rest of the customer experience.

In the end, that is what hospitality is all about: the experience. We wake up every day asking ourselves, ‘what can we do to help our customers deliver the best experience possible at their properties?’

By virtue of what we do, we help our customers to take a fresh look at themselves and evaluate whether their processes and internal capabilities fit their vision for where they want to go as an organization. Our approach is not to be prescriptive, but rather to work closely with our customers and innovate together.”

M AY 2 0 1 9

“ O UR SERVICE HAS CAPABILITIES THAT ARE UNMATCHED IN THE INDUSTRY” — Steve Markle, CEO, BirchStreet Systems

29

Markle concludes: “What we do is

excited about what the future has in

not just about deploying our software;

store for us as we innovate with our

it’s about working with our customers

customers to transform the worldwide

to provide the tools and expertise they

hospitality industry.”

need to deliver their desired outcomes: the very best experience to their customers, while using technology to minimize the costs of delivering their product. We could not be more proud of what we have achieved over the past 15 years and couldn’t be more w w w.busi ne ssc hief. com

Covering every angle in the digital age The Business Chief platforms offer insight on the trends influencing C and V-level executives, telling the stories that matter

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LEADERSHIP

32

M AY 2 0 1 9

Information Builders: A new chapter in business intelligence Michael Corcoran, CMO at Information Builders, discusses his career in the BI space, new ways to deploy data and analytics, and the future of the company as an industry leader WRITTEN BY

HARRY MENEAR

w w w.busi ne ssc hief. com

33

LEADERSHIP

I

ndustry 4.0 is here, and it is driven by data. As the

world comes to recognize the undeniable power of data to detect trends, improve efficiency and

predict the future, the business intelligence (BI) and

analytics industry continues to innovate and scale, in order to fully realize the potential benefits of the information age. Founded over 40 years ago, Information Builders is one of the world’s largest BI, data integration and data quality solutions companies worldwide. Headquartered in New York City, the firm is on the verge of a bold new chapter in its story as it prepares to dramatically grow in size and elevate its brand to the next level. We sat 34

down with Information Builders’ Chief Marketing Officer (CMO), Michael Corcoran, to discuss his career in the BI space, new ways to deploy data and analytics, and the future of the business as an industry leader. “We’re re-birthing a company that started all of this, back in the 1970s, when it was a very different world. Now, we’re creating a company for the next generation,” Corcoran explains. “It’s much more competitive today than ever. 60 years ago, the average life expectancy of a company was about 75 years. In 2015, it was 15. We have to move more quickly. We have to take advantage.”

Corcoran’s career in IT started in the 1980s working for a leading US aircraft manufacturer.

“I worked in the supply chain for the US Navy making fighter jets”, he recalls. “Top Gun came out whilst I was working there and they actually held a special M AY 2 0 1 9

35

“We’re creating a company for the next generation” — Michael Corcoran, CMO, Information Builders w w w.busi ne ssc hief. com

LEADERSHIP

36

“ We’re going to grow more aggressively, but I think what’s more exciting is that we’re going to be a leader in the innovation of new technologies” — Michael Corcoran, CMO, Information Builders

screening at our company. It was really cool, and taught me a lot about the supply chain.” The rapidly advancing art of data analytics is, to Corcoran, as exciting as building an F-14 Tomcat, and closely linked with the changing generational attitudes to technology.

Reflecting on the new priorities of Millennials and Generation Z, Corcoran notes that “they’re looking for something different and they’re behaving differently. They want to walk to restaurants and bars. They don’t own cars; they don’t want to own cars.

I think that generation is adopting technology. They don’t fear it. They crave it. That’s exciting to me because I’ve always craved it.”

Despite the speed at which data analytics tools are advancing, Corcoran believes that adoption across the business community is far too low.

“Only 10% of organizations are using predictive analytics in production applications – only 10%. Overall, there is about a 35% adoption of BI analytics, and for tools it’s only about 17%. Why? Because, companies don’t trust their data. How do you build predictive outcomes on data you know is wrong to begin with? You don’t. It’s a waste of

M AY 2 0 1 9

CLICK TO WATCH : ‘THE INFORMATION BUILDERS COMPETITIVE ADVANTAGE’ 37 time,” he says. The fallibility of gathered

growth. Companies that use analytics in

data is the largest obstacle standing in

data more effectively are faster growing

the way of mass BI analytics adoption,

companies. Their stock performs better,

according to Corcoran, which is why

their employees perform better. As well

Information Builders’ platform seeks to

as the longevity of customers.”

address the problem for the consumer.

With regard to employee

“We’ve taken responsibility for data

performance and the more effective

quality and mastering the data as part of

leveraging of data, Corcoran wants to

the BI Analytic platform,” he says. In

see a change in the way companies

addition to ensuring data quality at a

grant access to their analytics.

ground level, Information Builders’

“How do you scale adoption throughout

platform is also designed to be highly

the organization to find the value?”

scalable. “It’s kind of our secret sauce,”

Corcoran has found that, for the most

says Corcoran. “People who can scale

part, data passes from analysts to

analytics tend to enjoy much greater

management’s dashboards without w w w.busi ne ssc hief. com

LEADERSHIP

“ 60 years ago, the average life expectancy of a company was about 75 years.

In 2015, it was 15” — Michael Corcoran, CMO, Information Builders 38

M AY 2 0 1 9

being exposed to anyone lower in the organization. “Analysts ask the hard questions and they publish the results typically in the form of dashboard back to management. Management needs their dashboards. This process represents about 90% of all the effort and investment in the world of analytics right now. However, it’s not the most valuable thing we could be doing,” Corcoran explains. “It’s an interesting conversation I often have with CEOs to make them understand that they are not necessarily the most valuable person in this process. They need good information and insight to steer the ship, but management need information to set policy and to create goals. Those policies typically take about 12 to 24 months before they start to impact the bottom line of a large organization. There are things you can do lower in the organization that have a more immediate impact on the bottom line.” For Information Builders, BI should be pervasive both within and without the company. “What we like to do is expand the conversation.

Pervasiveness is about bringing analytics insight to every employee, business partner and even using it to w w w.busi ne ssc hief. com

39

LEADERSHIP

40

create a different digital relationship

realize. It’s pretty cool when you’re told

with your customer.” Corcoran believes

something that you didn’t know about

that, in 2019, companies owe their

your own life. It was really compelling.

customers “some form of digital

I think it’s really a clever way to get

transformation – it’s not just internal,

people to another level of, not only user

it’s how you interact externally.” As a

adoption, but customer loyalty.”

2mn mile lifetime member at American

In addition to changing the way that

Airlines, Corcoran points to the

companies deploy their data and

company’s end of year summary as an

analytics, with the appointment of its

example of expanding analytics to the

new CEO, Frank Vella, Information

customer. “They sent me an infographic

Builders is going through a bold new

that told me my story. I flew 98,000

transformation. “I believe we could be a

miles and my most common destination

really top brand name and lead the

was Frankfurt, Germany, which I didn’t

market,” says Corcoran. Since joining

M AY 2 0 1 9

WEBFOCUS

WebFOCUS (IB’s new analytics platform) has “an elegant, fully responsive user interface and intuitive workf low to automate and simplify complex tasks. Unlike many analytics tools, which create silos and cannot scale, the New WebFOCUS empowers everyone inside and outside the organization with unlimited intelligence.

The New WebFOCUS is uniquely positioned to fulfill all the needs of a modern enterprise, through its ability to combine a broad range of governed BI and analytics with agile insights created by business users, all in one place, securely, at scale, and in the cloud or on premises.”

41

the company in November 2017, Vella

We’re going to grow more aggressively,

has led the digital transformation of

but I think what’s more exciting is that

several areas of the business, including

we’re going to be a leader in the

product, innovation, marketing, sales

innovation of new technologies. We’ve

and channels. He also oversaw the

always had some of the smartest

launch of WebFOCUS, the company’s

people and we’re still introducing more,

flagship analytics platform. “We have

and for me that’s really exciting. I want

the biggest deployments in the world

to see the company double or triple in

but nobody knows it because the

size and I believe that now it can.”

company has been privately held,” says Corcoran. “Well, now we’re a Goldman Sachs-backed company. We’ve got a brand-new leadership management team hand-picked from the industry. w w w.busi ne ssc hief. com

TECHNOLOGY

MAKING THE CASE FOR CYBERSECURITY INVESTMENT 42

Spencer Young, Regional Vice President EMEA at Cybersecurity leader Imperva explores how businesses need to take decisive action and address today’s complex cybersecurity threats WRITTEN BY

SPENCER YOUNG

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43

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TECHNOLOGY

44

2

018 turned out to be a significant

year for cybersecurity with breaches and attacks making

formal cybersecurity policies in place.

While this discrepancy is worrying, it shines the spotlight on why business

the news far too often. In fact, a recent

leaders are yet to fully embrace the

report released by the Department

value of cybersecurity.

for Digital, Culture, Media and Sport

Although we’re in the era of digital

revealed that over four in ten businesses

transformation, many organizations

(43%) in the UK experienced a

are looking for guaranteed returns

cybersecurity breach or attack last year.

from their technology investments.

The same report goes on to highlight

Therein lies the problem – with

that despite the growing number of

increasingly tight budgets, senior

cybersecurity threats and attacks fewer

leaders view of cybersecurity systems

than three in ten businesses (27%) have

is currently framed as insurance. So,

M AY 2 0 1 9

“ALTHOUGH WE’RE IN THE ERA OF DIGITAL TRANSFORMATION, MANY ORGANIZATIONS ARE LOOKING FOR GUARANTEED RETURNS FROM THEIR TECHNOLOGY INVESTMENTS. THEREIN LIES THE PROBLEM” — Spencer Young, Regional Vice President, EMEA at Imperva

45

how do we shift this mindset so that

required to prepare for these new

senior leaders can better understand

compliance landscapes, they are

that the value of protecting business

putting security strategy decisions at

critical data extends far beyond just

the top of the priority pile of boards

covering your assets?

and exec teams.

Board members, in particular, are

CYBERSECURITY AND THE BOARD

responsible for establishing good

In recent months, we’ve seen the

governance practices and policies for

introduction of new regulations such

driving better financial performance

as the EU’s GDPR, as well as

and growth. For this reason, it is vital

constantly shifting privacy laws in

that they have a comprehensive view

nearly every geography. While there

of their organization’s cybersecurity

are considerable levels of effort

strategy, and the required level of w w w.busi ne ssc hief. com

TECHNOLOGY

46

“ A RECENT REPORT RELEASED BY THE DEPARTMENT FOR DIGITAL, CULTURE, MEDIA AND SPORT REVEALED THAT OVER FOUR IN 10 BUSINESSES (43%) IN THE UK EXPERIENCED A CYBERSECURITY BREACH OR ATTACK LAST YEAR” — Spencer Young, Regional Vice President, EMEA at Imperva

investment for buying down their risk.

Where cybersecurity may have previously been considered one subset of operational IT, a cursory glance over the press clippings in recent years will have alerted them to the real challenge. A growing number of business leaders are awakening to the fact that a data breach is all but inevitable. What they need to know is, how they can limit the scope of damage from a data breach with the right level of investment.

STEP 1: MAKING THE CASE TO SENIOR LEADERSHIP As the levels of liability for failing to govern risk and protect critical data are transferred from the IT department to senior leadership, these leaders need a quantified measurement of risks including:

• Compromised customer data • Diminished brand and reputation • Loss of investor and consumer confidence and loyalty

• Stolen sensitive intellectual property • Compliance and regulatory sanctions • Business disruptions M AY 2 0 1 9

CLICK TO WATCH : ‘MEET THE NEW IMPERVA – DEFENDING YOUR BUSINESS GROWTH TODAY AND TOMORROW’

STEP 2: ASSESSING THE CURRENT SITUATION

The next step requires you to conduct a

Once these risks are quantified, due

thorough inspection of your current

diligence will require leaders to

security posture.

assess the steps their partners and

STEP 3: DO A COMPLETE AUDIT

This involves understanding where

competitors are taking to avoid

your critical data currently resides, who

exposure. Relationships with

requires access to it and more critically,

technology suppliers and lenders then

who actually has access to it.

become less transactional, and more

While it’s a drum we beat perpetually at

of a long-term advisory partnership,

Imperva, many leaders don’t understand

as they’re best placed to provide

the risks of a potential data breach by

advice on the current trends within

careless, compromised, and malicious

your marketplace.

insiders. Not all data assets carry the w w w.busi ne ssc hief. com

47

TECHNOLOGY

same level of risk, and not every employee should be given carte blanche access to all organisational data.

While this may be time-consuming, leaving no stone unturned at this stage of the audit will give you a clear understanding of where your security measures stand currently and benefit you greatly in the long run.

FINAL STEP: DETERMINE THE RIGHT INVESTMENT FOR YOUR BUSINESS By appraising your data assets in 48

terms of their value and risk, you can then begin targeting your investments towards timely threat detection and incident response.

No matter the time and effort invested, it is important to remember that data breaches are inevitable.

Framing this approach as a risk/ reward equation and using a tiered security approach ensures that your organization can protect high-value targets that would cause significant harm if they were compromised.

At the very least, senior leaders need to be made aware of the growing threat they face every day from external cyberattacks and internal data M AY 2 0 1 9

“A GROWING NUMBER OF BUSINESS LEADERS ARE AWAKENING TO THE FACT THAT A DATA BREACH IS ALL BUT INEVITABLE” — Spencer Young, Regional Vice President, EMEA at Imperva

49 breaches. A single breach has the potential to irreparably damage the financial condition of even the most successful business, and ruin the careers of those leaders involved.

Rather than packaging your cybersecurity spending rationale within IT investments, these really need to be highlighted as a high-level risk mitigation strategy.

w w w.busi ne ssc hief. com

PEOPLE

50

How to win the war for skilled talent THE SKILLS GAP IS OFTEN CITED AS ONE OF THE BIGGEST OBSTACLES FACING BUSINESSES TODAY. ARE YOU READY TO BEAT IT? WRITTEN BY

M AY 2 0 1 9

LAURA MULLAN

51

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PEOPLE

T

hanks to technology, the way we work is set to change forever. You need only look at the impact of driverless

cars to see just how disruptive the next generation of technology will be. In fact, accord-

ing to a McKinsey Global Institute report, as many as 375mn workers (or 14% of the global workforce) might need to switch occupation categories because of digitization, automation and artificial intelligence (AI). It’s a mammoth shift for workers, but it’ll impact business too.

Tomorrow’s business leaders will need more 52

analytical, digital-savvy skills than ever before if they want to keep up with the blistering pace of digital transformation – but will companies be able to find these skills? Research by the Korn Ferry Institute forecasts that the existing talent shortage will reach its worst levels in 2030, whereby an expected 85.2mn job openings will go unfulfilled worldwide. In previous decades, the ‘war for talent’ dominated the headlines, but looking forward it seems that it will be the skills gap that will define the business agenda.

AN ANALYTICAL MIND Many tout data as ‘the new oil’, and as a result, data literacy has quickly become a highlycoveted skill for today’s business leaders.

M AY 2 0 1 9

“We paired legacy employees with millennials and this helps to break down the paradigms you develop over decades of business.

It makes the business open to new ideas” — Dayne Turbitt, Senior Vice President of Dell EMC’s Enterprise Sales Division

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53

PEOPLE

Gartner has even gone as far as to

exclusive interview with Gigabit, CEO

predict that, by 2020, 80% of organiza-

Adam Selipsky, said: “Recent estimates

tions will have to start to roll out data

from the IBC suggest that between

literacy initiatives to upskill their work-

now and 2025, the amount of data in

force. One such company, powering

the world that’s subject to analysis is

ahead with such training is data visualiza-

going to grow 50-fold. I think a lot of

tion giant, Tableau Software. The firm

organizations are just going to get

recently launched Academics, a progr-

crushed under the weight of that data

amme that has helped around 680,000

whilst many others are going to see

students and faculties use Tableau’s

brand new opportunities to develop

software, and on top of this, it has also

insights and make better decisions

partnered with British training partner

based on all of that data. Regardless

AVADO to launch apprenticeships and

of whether your organization sees data

training programmes in the UK. In an

as a problem or an opportunity, there’s

54

M AY 2 0 1 9

CLICK TO WATCH : ‘THE HIDDEN WOMEN OF STEM – ALEXIS SCOTT – TEDX, MOUNTAIN VIEW COLLEGE’ 55 an urgent need for analytical capabilities to deal with it, and again, to make better decisions faster.”

DIVERSITY MATTERS It’s no secret that many businesses have a diversity problem. In fact, according to stark research conducted by INvolve, more people called David and Steve lead FTSE 100 companies than women and ethnic minorities. Diversity matters but recent research shows that it also pays: in a 2015 study, McKinsey found that companies in the top quartile for gender or racial and ethnic w w w.busi ne ssc hief. com

PEOPLE

“We need to increase the pipeline of women in STEM and that starts with education” — Neelam Sandhu, Senior Director of Business Operations, Office of the CEO at BlackBerry

56

diversity are more likely to have financial

think that’s changing. For example, we

returns above their national industry

can see that two leaders of General

medians. Bringing a broad range of per-

Motors – the CEO and the CFO – are

spectives, diversity is a critical asset for

both women.” Another hurdle lies in

businesses looking to address the talent

education. “We need to increase the

gap. For Neelam Sandhu, Senior Director

pipeline of women in STEM and that

of Business Operations, Office of the

starts with education,” adds Sandhu.

CEO at BlackBerry, one of the biggest

“We need to work on creating an

hurdles lie in the lack of female role

environment where women feel comfor-

models in male-dominated fields.

table learning STEM topics. Not only is

“Women don’t have those same role

the professional environment male-dom-

models or examples as men to look up

inated, but the education environment

to or emulate,” she observes. “But I do

is too. So, creating that environment or

M AY 2 0 1 9

57

community where women feel

whereby it pairs more seasoned

comfortable in STEM is important.”

employees with new graduates to encourage cross-generational peer-

REVERSE ENGINEERING

to-peer training. “I think it’s been

Any CIO will admit that digital transfor-

a huge learning curve for us,” says

mation isn’t just about new gadgets

Dayne Turbitt, Senior Vice President

and technologies, it’s also about the

of Dell EMC’s Enterprise Sales

people. At its annual Dell Tech forum,

Division. “We paired legacy employ-

for example, Dell Technologies singled

ees with millennials and this helps

out workforce transformation as a cru-

to break down the paradigms you

cial stand of any digital disruption

develop over decades of business. It

programme. Within the firm, Dell Tech-

makes the business open to new

nologies has implemented what it

ideas, it fosters a new culture of inno-

describes as ‘reverse engineering’,

vation. We’ve done some amazing w w w.busi ne ssc hief. com

PEOPLE

58

things in the past year and it’s down to this speed of innovation.”

PROCUREMENT VALUE Many procurement professionals will tell you that their job is no longer a support function, it’s a business driver. With procurement now at the fore of many business strategies, skilled workers in this field are in high demand. The Chartered Institute of Procurement & Supply (CIPS) has played a pivotal role in the professionalization of procurement across the M AY 2 0 1 9

world, offering a range of highly-valued training courses. Sam Achampong, Regional Head & General Manager of CIPS MENA, believes that this is crucial to the upskilling of the procurement field. “We work very closely with companies to create a licensed procurement function whereby everyone in their procurement team is qualified to do procurement. We have created the infrastructure to make qualifications available through an increased number of study centres, universities and accredited degrees. For people, we have also set up a number of professional networks that support these people so that they can continue to share knowledge.” Achampong also underlines the importance of working with local communities, noting: “The key thing is for us to be working with local people in this region, so we’ve worked very hard with the prominent local organizations to make sure that we are helping the capability development of Middle East locals to get credible procurement qualifications and skills.”

PEOPLE POWER Looking forward, it’s clear that if you want to build the workforce of the w w w.busi ne ssc hief. com

59

PEOPLE

“We should never underestimate the power and need of human interaction” — Johan Reventberg, President EMEA at JDA Software

60

future you need to act proactively.

survey, McKinsey pointed out that

Business leaders should be vigilant

75% of executives were optimistic that

about workforce gaps and be aware

reskilling and training would help to fill

of the skills needed in the future. They

at least half of their talent needs. Amid

should also create a robust plan to

the war for talent and hiring difficul-

hire, upskill and contract the right

ties, businesses need to be productive

skills and be sure to establish a dedi-

if they want to tackle the challenge of

cated cross-functional team, with

skills and training. It may be easy to

a forward-thinking HR team. In a recent

get caught up in talk of digital disrup-

M AY 2 0 1 9

61

tion or supply chain transformation

people behind. If people get left behind,

but without the people behind it, it’s

they will then be a threat to themselves

near impossible.

and to the companies because they’re

“We should never underestimate the

not going to keep pace with the company.

power and need of human interaction,”

If we don’t train our people, we’re not

agrees Johan Reventberg, President

enabling the workforce of the future.”

EMEA at JDA Software. “The risk is that if your company doesn’t educate and train your workforce, you will leave the w w w.busi ne ssc hief. com

S U S TA I N A B I L I T Y

62

Bringing greener cities to life through connectivity and innovation Hosting half the world’s population on 2% of the planet’s surface poses a unique set of challenges, says Mike Hughes, Zone President UK and Ireland, Schneider Electric WRITTEN BY

M AY 2 0 1 9

MIKE HUGHES

63

Deloitte’s headquarters, The Edge Building in Amsterdam w w w.busi ne ssc hief. com

S U S TA I N A B I L I T Y

T

ackling climate change and

population is expected to grow by over

creating sustainable cities in the

1bn people over the next thirteen years,

face of rapid population growth,

reaching 8.6bn in 2030.

ageing infrastructure and the

Meanwhile, the increasingly digital,

pace of technological change has

connected and electric nature of our

never been more important. Cities

lives means that we each as individuals

make up 2% of the world’s surface

have greater energy needs than ever

but house more than half of the world’s

before. Is this pace of growth sustain-

population and consume 75% of

able for urban centres and cities like

energy resources. By 2030, urban areas

London or Paris, let alone megacities?

are projected to host 60% of people

The answer is yes, but only if we make

globally. Very soon, one in every three

our cities ‘smarter’.

people will live in cities with at least half a million inhabitants, as the world’s 64

M AY 2 0 1 9

Incorporating renewables into our energy mix is a vital part of reducing

our environmental impact, but their potential is being wasted by our inefficient use of that energy. Modern technologies, smart sensors and services that can help us identify and tackle energy waste can and must help to improve cities’ efficiency, sustainability, and resilience.

For any city, going ‘smart’ can be difficult. The sheer size and complexity involved in building a truly integrated

“ Creating sustainable cities means creating smart cities, powered by clean energy that is responsibly consumed and saved” — Mike Hughes, Zone President UK & Ireland, Schneider Electric

and sustainable smart city is difficult to comprehend. In India, Schneider Electric is helping to build Naya Raipur, 65

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S U S TA I N A B I L I T Y

“ The only way we will tackle climate change and create cities fit for the future is by rethinking our relationship with energy as individuals, businesses and nations” — Mike Hughes, Zone President UK & Ireland, Schneider Electric

a project which aims to build an entirely new capital city for the newly created state of Chhattisgarh. The funding, expertise, organisation, planning and collaboration to create this smart city from the ground up is incredible. Smart cities at this scale require multi-level governance, expert consultants, technology firms and vendors working together to make the concept a reality.

But the vast majority of the world’s population live in existing towns and cities, not brand-new developments.

66

Naya Raipur is a smart city project located in the newly formed state of Chhattisgarh in India Photo © Smart Cities Council India

Ageing city infrastructures pose connectivity and network management challenges. At the same time, a 24/7 society and a wide array of IoT-enabled devices and electric vehicles (EV) are fuelling greater energy demand. While cities are tasked with improving services and building new transport networks, hospitals, schools, and homes to accommodate population growth, they do so with tightening budgets. Critical infrastructure (old or new) – such as hospitals, airports, live entertainment venues, schools and office buildings – must be reliable, functional but also efficient if we are to build a sustainable future. And it is in efficiency where there is potential to

M AY 2 0 1 9

CLICK TO WATCH : ‘TOTTENHAM HOTSPUR’S NEW STATE-OF-THE-ART STADIUM WITH ADVANCED ENERGY MANAGEMENT FACILITIES’ 67 unlock huge financial savings that

of projects to improve their water

could, in turn, reduce running costs,

systems, local or regional energy grids,

helping to fund future investment.

transport infrastructure or buildings.

Developed cities considering going

These precincts or district-scale

‘smart’ simply don’t have the option to

developments are not city-scale, but

rebuild everything from the ground up.

they are large enough to form multiple

They are busy, functioning ecosystems

smart city domains and become a

that need to continue to work whilst

visible and useful reference point to

improvements are made. As a result,

encourage future investment. Indeed,

a piecemeal approach to making cities

by working collaboratively with both

smarter is the only option. It is essen-

public and private sectors, Schneider

tial, therefore, that incentives and

Electric has successfully delivered

regulation are introduced to drive

smart city project applications to more

organisations and individuals to

than 250 cities worldwide.

incorporate efficiency as a core pillar

One such example is our recent w w w.busi ne ssc hief. com

S U S TA I N A B I L I T Y

partnership with Tottenham Hotspur to help build and manage the energy distribution and consumption at the club’s new state-of-the-art stadium – a landmark in sports venue efficiency and connectivity. As the stadium’s official Energy Management Supplier, Schneider Electric performs 60,000 automated checks every five minutes to ensure that every aspect of energy usage is monitored and optimised, ensuring such aspects and optimal temperature and lighting conditions.

Designed for visitor enjoyment and 68

comfort, the stadium is also helping to regenerate the surrounding area of Tottenham, bringing the smart city reality one step closer.

The ripples of projects such as these, ambitious in scale and innovative in nature, not only improve energy efficiency, but also set a new standard of living and urban regeneration, whilst also starting to change perceptions of energy use. Take for example the Edge building, Deloitte’s headquarters, in the Netherlands. This building not only delivers a cutting-edge digital workspace and meets the highest environmental standards, but it was created with the goal of being a ‘net neutral’ M AY 2 0 1 9

Tottenham Hotspur’s new state-of-the-art stadium

“ Projects such as these, ambitious in scale and innovative in nature, not only improve energy efficiency, but also set a new standard of living and urban regeneration” — Mike Hughes, Zone President UK & Ireland, Schneider Electric

building and the potential to be ‘net positive’. The Edge is a building that is self-sufficient in terms of the energy it requires to function, and at times (such as at night or weekends) returns excess energy produced to the grid.

Forward-thinking projects such as these start to enable us to imagine a future where perhaps the majority of homes, businesses, schools and hospitals could be at worst net neutral and ideally net positive. Imagine receiving an income from your home or place of work, instead of paying bills. It would completely change the way we think about energy generation, distribution, and consumption. Digitisation paves the way for more and more net neutral or net positive buildings, generating their own energy on-site with smart systems that give excess energy back to the grid.

Whilst net neutral and net positive buildings are currently just a dream for all but a few, the road to achieving this starts with tackling waste. Something that every government, business or individual can do. With demand for energy rising, unlocking untapped energy efficiency potential has never been more urgent, or easily achieved. w w w.busi ne ssc hief. com

69

S U S TA I N A B I L I T Y

Investing in smart systems that monitor energy use and efficiency across every aspect of your energy infrastructure is something that can be realised today.

By understanding how, where and when energy is used, opportunities for efficiencies can be identified and actioned. Our Global Digital Transformation Benefits Report 2019 identified 12 ways that the digital transformation of energy management and automation drives benefits in CapEx, OpEx, based on interviews with 230 businesses. These companies have realised 70

savings in energy consumption of up to 85% and up to 80% on energy costs.

Energy efficiency projects are becoming a C-suite priority, as board members recognise the competitive edge that projects can deliver, at the same time as delivering on sustainability commitments which employees, customers and governments are driving for.

Projects like these demonstrate that rethinking energy is not only a major enabler of innovation. It powers progress and life.

As the global population grows and our world and lives become increasingly electrified, creating sustainable cities means creating smart cities, M AY 2 0 1 9

S TAT I S T I C S

• Cities make up 2% of the world’s surface but house more than half of the world’s population and consume 75% of energy resources • By 2030, urban areas are projected to host 60% of people globally

Crossrail Place Roof Garden in Canary Wharf, London Photo Š Jason Williams

powered by clean energy that is responsibly consumed and saved.

The fact is it is far easier to save a unit of energy than it is to create one. The only way we will tackle climate change and create cities fit for the future is by rethinking our relationship with energy as individuals, businesses and nations.

Deloitte’s headquarters, The Edge Building in Amsterdam

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The Global Summit of The that unites CEOs from so manufacturers and service destination where 1,000 b under one roof every year insights and learnings from voice and discuss the key and in the future. It’s abou

2019 SPEAKERS INCLUDE:

Jean-P Chairm L

e Consumer Goods Forum is the business event ome of the world’s most successful retailers, e providers. This unique event is the essential business leaders and key stakeholders gather r. It is where CEOs talk to CEOs with additional m global and regional experts. It is the place to issues and challenges facing our industry now ut purpose and driving positive change globally.

To learn more about The Consumer Goods Forum and how to become a member, please visit our website: www.theconsumergoodsforum.com

Paul AGON man and CEO L’Oréal

Sarah DAVIS President Loblaw Companies Ltd

Max KOEUNE President and CEO McCain

Mark SCHNEIDER CEO Nestlé

Captain Scott KELLY Astronaut

CITY FOCUS

Business Chief Canada explores Winnipeg’s James Armstrong Richardson International Airport, the high tech transport hub helping put the city on the map.

WINN City Focus

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WRITTEN BY

HARRY MENEAR

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NIPEG w w w. b u s i n e s s c h i e f. c o m

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CITY FOCUS | WINNIPEG

L

ocated at the intersection of the Red and Assiniboine rivers, Winnipeg is the capital of the province of Manitoba. Historically a

center of indigenous trade dating back long before European settlement, Winnipeg officially achieved cityhood in 1873 and today is home to over 705,000 people. Nicknamed “The Gateway to the West”, the city is a transportation hub with strong rail links served by Via Rail at Union Station for passenger rail. Freight Rail, meanwhile, is handled by the Canadian National Railway, Canadian Pacific Railway, Burlington Northern Santa Fe Manitoba and the Central Manitoba Railway.It is the only major city between Vancouver and Thunder Bay 76

with train links directly to the United States, according to Destination Winnipeg.

NEW HEIGHTS Another element of Winnipeg’s role as a transportation hotspot is its air transport hub, the James Armstrong Richardson International Airport.

Located on the Western outskirts of the city, Winnipeg International is Canada’s seventh-busiest airport by number of passengers, serving over 4.3mn people in 2017. In 2018, this figure rose again to 4.5mn in 2018, continuing a period of steady growth for the airport, according to a report

by Global News Canada.

“The increase in traffic this summer is directly connected to the growing interest in our city and province. Winnipeg and Manitoba are where people M AY 2 0 1 9

77

“ The increase in traffic this summer is directly connected to the growing interest in our city and province” — Barry Rempel, President and CEO, Winnipeg Airports Authority

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CITY FOCUS | WINNIPEG

want to be, and we are seeing more and more traffic as a result,” said Barry Rempel, President and CEO of Winnipeg Airports Authority. “WAA continues to work with our airline partners to improve service and add more destinations to connect our region to the world.” On average, Winnipeg International serves 11,000 passengers each day, and that figure is only expected to increase.

Additionally, Winnipeg International is the number one airport in Canada for dedicated freighter flights, keeping 78

goods flowing efficiently and building on the city’s reputation as a transportation and logistics hub. All told, the Winnipeg Richardson International Airport has a CA$3.4bn economic enefit and supports over 17,000 jobs in and around the city.

INTELLIGENTLY SECURE Winnipeg International is not content to become one of the country’s biggest air hubs; it is also determined to be one of Canada’s smartest. Winnipeg International is one of a small group of Canadian airports to incorporate biometrics-enabled primary inspection

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© KDOAN

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CITY FOCUS | WINNIPEG

“ Our success is a direct result of bringing together partners who are committed to lead transportation innovation and growth” 80

— Barry Rempel, President and CEO, Winnipeg Airports Authority

kiosks into its border control process.

tive should help Winnipeg International

According to a report by Biometric

process its growing passenger base at

Update, Winnipeg, alongside select

an even greater speed.

pilot programs in Toronto, Quebec and Hamilton, has implemented self-ser-

MEET OTTO

vice, fingerprint-enabled kiosks for use

In addition to being among the first

by biometrically enrolled foreign

adopters of self-service biometrics, in

nationals and permanent residents.

March 2019 Winnipeg International

Biometric-enabled kiosks that auto-

became North America’s very first air-

mate the border clearance process are

port to pilot an autonomous snow plow.

scheduled to be phased-in at all major

Winnipeg experiences an average of

Canadian airports throughout 2019. Its

53 days of snow each year. Starting in

position as a leading player in the initia-

Spring 2019, Winnipeg International

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81

will have its snow removal needs met by Otto, a specially designed ATI

Local Manitoba companies Northstar Robotics Inc and

Snow Mauler configured to operate

Airport Technologies Inc collaborated

autonomously using Northstar

on the autonomous vehicle’s construc-

Robotics technology.

tion. The plow can perform snow

“Launching North America’s first

clearing tasks by following predeter-

autonomous snow plow is a great

mined routes and controlling the plow

achievement for Winnipeg Richardson

blade at specific locations, according

International Airport,” said Rempel.

to a press release by the Winnipeg

“Our success is a direct result of bring-

Airports Authority.

ing together partners who are

“Autonomous technology is

committed to leading transportation

changing how we work,” said Shawn

innovation and growth.”

Schaerer, President and Founder of w w w. b u s i n e s s c h i e f. c o m

CITY FOCUS | WINNIPEG

Northstar Robotics. “It is exciting to

We are excited to continue to find

partner with companies that are ready

new ways to incorporate autonomous

to adapt and pioneer this cutting-edge

technology into our equipment.”

technology.” ATI’s President, Brendon

Otto is equipped with 3D LIDAR and

Smith agreed, adding that “ATI is proud

RADAR that can sense its surround-

to be part of the team breaking new

ings and detect obstacles. The plow is

ground in snow clearing technology.

also equipped with a fault tolerant wireless emergency stop system, a further safety enhancement. Research and

1873

Official city status 82

705,000

© AJ BATAC

Population

Airport supports

17,000

jobs in and around the city.

M AY 2 0 1 9

development will continue, focusing on allowing Otto to operate in more complex areas of the airport.

CLICK TO WATCH : ‘XINNIPEG AIRPORTS AUTHORITY: THERE’S MORE TO COME’ 83

REALIZING THE AIRPORT CITY VISION

is another step in realizing the vision

In addition to equipment, Winnipeg

of Winnipeg as an airport city.”

International is expanding its infra-

The multi-use building will give

structural capabilities in order to better

ground handling, commissary and

support its industry-leading freight

cargo companies operating space

proficiencies. In June 2018, the Winni-

close to the terminal. Once completed,

peg Airports Authority broke ground

current tenants in the airport’s cargo

on a 96,000 square foot Ground Ser-

campus will relocate to the new GSE

vices Equipment (GSE) Building. At the

Building, freeing up much-needed

unveiling, Rempel said of the $27mn

space in the cargo area for redevelop-

building: “The world is more and more

ment. Winnipeg International is a

connected every day, and for Winnipeg

constantly evolving and expanding

to fulfil its potential on the global stage

entity, both an expression of and

we must have the infrastructure in

a driving force behind the rising star

place to compete. Today’s investment

of Canada’s Gateway to the West. w w w. b u s i n e s s c h i e f. c o m

T O P 10

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TOP 10

US universities for business Business Chief takes a look at the top 10 universities in the United States for business and management degrees, according to the Times Higher Education’s 2019 rankings

WRITTEN BY

HARRY MENEAR

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T O P 10

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10

University of California Los Angeles, CA

Founded in 1919, the University of California, Los Angeles (UCLA) is the third-oldest of the 10 public universities located in California (preceded only by UC Berkeley and UC Davis). UCLA offers 230 undergraduate and graduate majors, with over 24 programs ranked among the top 20 in their respective disciplines. The Anderson School of Management which houses UCLA’s business courses was founded in 1935 and is home to approximately 1,750 students.

Famous alumni include Jackie Robinson, James Dean and Arnold Schwarzenegger.

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09

Columbia University New York, NY

Originally founded as King’s College by King George II of England, Columbia University is the oldest university in the State of New York and the fifth-oldest educational institution in the country. A member of the US’ prestigious Ivy League, Columbia’s endowment exceeds US$10bn.

According to the Times Higher Education, “the private research-based university has 20 schools – which include architecture, planning and preservation; business; Jewish theological seminary; and law – and 23 libraries that are scattered across the city.” Notable alumni include President Barack Obama, Warren Buffett and Allen Ginsberg.

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T O P 10

‘Berkeley was founded in the hope that it would “contribute even more than California’s gold to the glory and happiness of advancing generations”’

88

08

University of California Berkeley Berkeley, CA

Located across the bay from the City of San Francisco, the University of California, Berkeley, is one of the United States’ most prestigious public universities. Berkeley was founded in 1868 in the hope that it would “contribute even more than California’s gold to the glory and happiness of advancing generations”, according to the state’s constitution. The university is home to approximately 27,000 undergraduate students and 10,000 postgraduate students.

Notable alumni include Steve Wozniak, Earl Warren and Steven Chu.

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89

07

University of Pennsylvania Philadelphia, PA

One of the nine American colleges established before independence from British rule, the University of Pennsylvania (Penn) claims to be the first fully-fledged, multi-faculty university in the United States, according to Times Higher Education. Founded in 1749, under the direction of Benjamin Franklin, Penn was officially granted university status 30 years later, at the height of the American Revolution. Established in 1881, the Wharton School is the business college at Penn. Its notable alumni include Elon Musk, Donald Trump and Sundar Pichai.

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06

Johns Hopkins University Baltimore, Maryland

Johns Hopkins University is a private research institution serving over 21,000 students across its nine colleges: Zanvyl Krieger School of Arts and Sciences, Whiting School of Engineering, Carey Business School, School of Education, School of Medicine, School of Nursing, Peabody Institute, Bloomberg School of Public Health and the Paul H. Nitze School of Advanced International Studies. Founded in 2007, when the School of Professional Studies in Business and Education separated in two, the Carey Business School is the newest business college on the top 10 list. Notable alumni of Johns Hopkins include Michael Bloomberg, President Woodrow Wilson and Gertrude Stein.

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‘The University of Chicago was the first college to offer an Executive MBA’

91

05

University of Chicago Chicago, Illinois

An urban research university in the heart of America’s third-largest city, the University of Chicago was founded in 1890 and has an endowment of $8.2bn. The institution’s research has led to breakthrough discoveries like the link between cancer and genetics.

Founded eight years after the rest of the university, the Booth School of Business (named after a $300mn donation by David G Booth in 2008) is the second-oldest business school in the US and was the first school to offer an Executive MBA program. Notable alumni include Senator Bernie Sanders, Carl Sagan and Kurt Vonnegut.

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04

Yale University New Haven, CT

Another private research university and member of the historic Ivy League is Yale University, an institution with roots reaching back as early as 1701. It was founded as the Collegiate School in Saybrook, Connecticut, which moved to New Haven 15 years later, according to Times Higher Education. The college was renamed after benefactor Elihu Yale in 1718. In 1861, Yale was the first university in the US to award a PhD. The university has an endowment of $25bn, making it the second-richest educational institution in the world. Its business school, the Yale School of Management came into being in the 1950s. Notable Yale alumni include President George W Bush, Dick Cheney and Bill Clinton.

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‘Harvard has connections to more than 45 Nobel laureates, over 30 heads of state and 48 Pulitzer prize winners’

93

03

Harvard University

Cambridge, Massachusetts

With roots reaching back as far as 1636, Harvard is the oldest academic institution in the United States, and is ranked as the sixth best university in the world by the Times Higher Education.

The private Ivy League institution has connections to more than 45 Nobel laureates, over 30 heads of state and 48 Pulitzer prize winners.

It has more than 323,000 living alumni, including over 271,000 in the US and nearly 52,000 in 201 other countries. The Harvard Business School alone has an endowment of $3.8bn. Notable Alumni include Michael Bloomberg, Robert Kraft and Ratan Tata.

w w w.busi ne ssc hief. com

T O P 10

02

Massachusetts Institute of Technology Cambridge, Massachusetts

Located in Cambridge, the Massachusetts Institute of 94

Technology (MIT) is a private research university home to around 1,000 faculty members and over 11,000 undergraduate and graduate students. Currently, MIT is focusing its leading research departments on machine learning, sustainable energy, Big Data and healthcare.

MIT estimates “that all its living alumni have between them launched more than 30,000 active companies, created 4.6 million jobs and generated roughly $1.9 trillion in annual revenue”. Altogether, this ‘MIT Nation’ is equivalent to the “10th-largest economy in the world.” Notable alumni include Benjamin Netanyahu, Buzz Aldrin and Richard Feynman.

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‘The ‘MIT Nation’ is equivalent to the 10th-largest economy in the world’ 95

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T O P 10

01

Stanford University Stanford, California

Standing as the only world top 10 university located on the West Coast of the US, Stanford is a private research 96

university located in the heart of Silicon Valley. The college was founded in 1885 by Jane and Leland Stanford and has since been the home of breakthroughs including the first successful heart-lung transplant, the debut of the computer mouse, and the development of digital music. In total, companies founded by Stanford affiliates and alumni generate more than $2.7 trillion annual revenue, and include Google, Nike, Netflix, Hewlett-Packard, Sun Microsystems, Instagram and Charles Schwab.

Notable alumni include Elon Musk (PhD in physics after attending Penn), John F Kennedy and John Steinbeck.

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‘Companies founded by Stanford affiliates and alumni generate more than $2.7 trillion annual revenue, and include Google, Nike, Netf lix, Hewlett-Packard, Sun Microsystems, Instagram and Charles Schwab’

97

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Digital transformation in the financial Hea industry Pub WRITTEN BY

SEAN GALEA-PACE PRODUCED BY

JAKE MEGEARY

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Kerning +25, All titles

adline in blico Light

99

5, leading +2pt

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IGM FINANCIAL

Milorad Stefanovic, Vice President of Digital Technology, discusses how his firm is utilising technology to transform its operating model

A

s it undergoes a strategic digital transformation, IGM Financial has established three key pillars to form its digital

technology strategy. The Canadian wealth and asset management firm aims to create a more engaging experience for its customers, provide a productive insights-driven toolset for advisors 100

and also create a new digital platform for employees. IGM has accelerated its digital transformation significantly over the past couple of years, helping its clients improve their financial well-being and achieve their goals. To accomplish this, the company has leveraged scaled agile delivery to aid the digitization of its processes. “In the last 12 to 18 months, we’ve made significant progress. We’re utilizing technology faster and delivering solutions in an accelerated cycle,” says Milorad Stefanovic, Vice President of Digital Technology. “We believe agile provides a new way of working that allows us to deliver a connected digital experience to our IG Wealth Management and Mackenzie Investments clients and advisors and build a strong culture of collaboration across our joint business and technology teams.”

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“Talent is absolutely front and center to our digital strategy” — Milorad Stefanovic, Vice President of Digital Technology

101

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IGM FINANCIAL

“ Salesforce has been an important partner, helping us drive business and technology innovation at IGM as well as by accelerating our digital 102 transformation roadmap” — Milorad Stefanovic, Vice President of Digital Technology

Joining IGM in June 2018, Stefanovic’s previous leadership experience with Royal Bank of Canada (RBC) and IBM has furnished him with an understanding of how technology is transforming business operating models in the financial services industry. “My previous roles focused on digital banking for business and retail banking clients. I see important parallels between wealth management and business banking when it comes to connected digital journeys for clients and advisors,” he explains. “In both lines of business, there is an important role that the advisor or business banker plays in terms of managing the relationship with clients and growing their practices. I think that experience in business banking and wealth management has helped me to drive the strategic transformation for IG Wealth Management and Mackenzie Investments here at IGM.” Through the implementation of a new integrated toolset, IGM began two large initiatives in a bid to accelerate its transformation and deliver digital capabilities for advisors. “We are rolling out a new Salesforce-based digital platform for our advisors and accelerat-

M AY 2 0 1 9

ing our transition from paper-based

“Talent is absolutely front and center to

processes to a digital business,”

our digital strategy. It’s been recognized

Stefanovic explains. “We also launched

as part of our roadmap and is consid-

a new digital client platform, providing a

ered one of our main enablers. We

seamless omnichannel experience to

believe in both the importance of

our clients and advisors. Both the client

developing talent within the organisa-

access and the advisor digital capabili-

tion and the ability to attract external

ties are based on Salesforce which

talent as we move forward,” explains

allows us to share the data and insights

Stefanovic. “In terms of development of

across online and mobile for clients as

the talent within the organisation, we

well as the digital platform for advisors.”

have a structured, focused approach in

Recruitment is a vital task for any

developing the key skills related to

company, and Stefanovic maintains that

digital technology, specifically Sales-

due to his firm’s digital priorities, it has

force as well as the skills related to agile

become a central part of IGM’s strategy.

delivery at scale. Both agile and

E XE CU T I VE PRO FI LE

Milorad Stefanovic As Vice President Digital Technology at IGM Financial Milorad is responsible for the technology organization that delivers omnichannel experience and digital capabilities to IG Wealth Management and Mackenzie Investments clients, advisors, and employees. He is also responsible for the Salesforce Center of Excellence and the Scaled Agile operating model at IGM. Milorad is a seasoned executive with experience leading business and technology transformation, driving innovation, and delivering integrated end-to-end solutions in Wealth Management, Retail Banking, and Business and Commercial Banking.

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103

IGM FINANCIAL

104

Salesforce are specific learning paths

tion and empower our advisors to

that we have made available to our

deliver relevant and timely advice to our

employees.”

clients” he says. “Salesforce has been an important partner, helping us drive

VITAL STRATEGIC PARTNERSHIPS

business and technology innovation at

In order to accelerate its growth, IGM

IGM as well as by accelerating our

has established an important partner-

digital transformation roadmap.”

ship with Salesforce and Stefanovic

In addition, IGM has established

believes collaborations with firms such

other digital partnerships with Slalom

as this has been paramount to his

and Portag3 as the company contin-

company’s digital transformation. “The

ues to digitalize its operating model.

connected experience and capabilities

“Given the accelerated pace of our

available through our digital platform

digital transformation, we aren’t able to

allow us to accelerate our transforma-

develop everything in-house. It has led

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105

to us forming several partnerships,

FUTURE PLANS

including Slalom as a solutions

Looking ahead to the future of the

integrator. Slalom is a US-based

financial services industry, Stefanovic

company with a strong presence in

anticipates an increased focus on

Canada and they have helped us

effective application of artificial

considerably through the integration of

intelligence (AI) over the next few

the solutions and project delivery,”

years. “The adoption and application

explains Stefanovic. “In addition, we

of AI and machine learning capabilities

have a strong partnership with Portag3,

is well under way and these capabilities

the venture capital arm of Power

will play a central role going forward.

Financial Corporation. Our partnership

I expect the application of AI in our

with Portag3 and the portfolio compa-

industry to become a common

nies will help us stay ahead of the

practice in the future with a broad

curve moving forward as well.”

range of relevant use cases from w w w.busi ne ssc hief. com

IGM FINANCIAL

106

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ÂŁ20bn Mutual Fund Sales

HQ

Toronto, Canada

3,300

Approximate number of employees

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107

Slalom is a modern consulting firm focused on strategy, technology, and business transformation.

At Slalom, personal connection meets global scale.

Our consultants across the U.S., U.K., and Canada move fast and share insights to deliver high-impact business results.

“ We believe we can be the best company in Canada, in terms of delivering relevant and timely investment advice to our clients and helping them reach their full financial wellbeing potential”

marketing and sales to operations and service capabilities.”

Predicting the future for IGM, Stefanovic is confident his company will continue to be a leading provider of wealth and asset management products and services to Canadians in the upcoming years and beyond. “We believe we can be the best company in Canada, in terms of delivering relevant and timely investment advice to our clients and helping them reach their full financial wellbeing potential. We also feel we can draw a significant market share in the Canadian market too.”

— Milorad Stefanovic, Vice President of Digital Technology

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110

CHANTIER DAVIE: INTRODUCING CONNECTED FLEETS AND IOT WRIT TEN BY

SOPHIE CHAPM AN PRODUCED BY

JA MES BERRY

M AY 2 0 1 9

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C H A N T I E R D AV I E C A N A D A I N C .

Canada’s largest shipbuilder, Chantier Davie Canada, reveals how it is updating its technology to connect a shipyard the size of a small town

E

stablished in 1825, Chantier Davie Canada has been building ships for almost 200 years but has just started

to take the first steps on its digital transformation journey. The shipyard is the largest, highest capacity, and most experienced in 112

Canada. Davie Shipbuilding has a vision of being the nation’s “premier shipyard providing national strategic capability when it comes to the digital transformation,” claims Jeremy Citone, Technology Director of Chantier Davie Canada. “The yard has recently delivered the most complex vessel ever built in North America, and we are now focusing on innovating new ferries which use clean energy.”

“Being in a company with so much history, it’s a challenge in itself. Facilities are more than 2 kmsq. With its 56 buildings, it is really like a small town. When the shipyard reopened in 2012, it was 10 years behind with technology. Everything needed to be updated, from security, IT infrastructure to introducing Internet of Things,” notes Citone. Despite M AY 2 0 1 9

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CLICK TO WATCH : ‘CANADA’S NEXT AUXILIARY OILER REPLENISHMENT SHIP – EPISODE ONE’ 115 the numerous changes being made

were facing: to provide information

around Davie, its workers are entirely

when an where it is needed within our

involved and committed. “Major

environment.”

technology changes are always tricky

“The use of technology not only

to introduce. However, our workers

enables the shipyard to be more efficient,

are embracing the new tools they are

but it also makes the company more

provided with.”

sustainable, as it is able to move on

Citone notes that for him live information is key – while engineers are behind computers designing

from paper-based practices which are riskier and less reliable.”

Citone reveals that the shipyard’s

ships, the supervisors are onboard.

technologies are well on track to reach

“But how can you ask someone to be

Industry 4.0 levels. Over the past 3

efficient onboard a ship under construc-

years, he has introduced and fostered

tion if they don’t have access to that

a culture which has the goal of becom-

information? That’s the challenge we

ing a smarter and virtual shipyard. w w w.busi ne ssc hief. com

C H A N T I E R D AV I E C A N A D A I N C .

“In five years I see the implementation of AI for shipbuilding.

AI will allow us to use our workforce smarter” — Jeremy Citone, Technology Director of Chantier Davie Canada 116

“We are now 3D scanning incoming

the 3D models,” he adds. Augmented

ships, both inside and outside. When

reality technologies allow them to be

we have a virtual ship, we can measure

onboard and visualize the ship the way it

it from the office. We can select the

will look like once completed. All piping,

best spot for a piece equipment. That

equipment, and lighting systems are

allows us to work around the clock with

displayed on top of what the camera

engineering companies all over the

sees directly on the tablets onboard

world,” Citone explains. As part of the

the ship. This way, the supervisors can

firm’s digital transformation journey,

understand and show the workers

supervisors have been equipped with

what to do and where to do it.

tablets, and Wi-Fi has been installed

“I believe live information and reporting

across the site. “With the tablets, our

is key. In-house developed apps allow

supervisors are able to draw on top of

the supervisor to have a clear view of

M AY 2 0 1 9

the progress made onboard and keep track of their budget per task. All tablets are connected to the main cluster and are regularly updated with any revisions as it is used. This reduces risks and mistakes” Efficiency, according to Citone, is the most important aspect of the company’s digital transformation journey. “However, as we are based in Canada, the labor is quite expensive compared to all of our international competitors.

Therefore, our employees need to be very efficient and technology-driven.”

However, Citone notes that live information is being used even further: “For every ship, we collect as much E XE CU T I VE PRO FI LE

Jeremy Citone After finishing his second Master’s degree in Computer Science in California, Jeremy was head hunted by the INOCEA group in Monaco to take on a role of a system engineer. His vision for shipyard technology led him to Inocea-owned Chantier Davie, the largest shipyard in North America. In 2017, just a few years after joining the company, he became the head of the IT department. Today, Jeremy works on implementing his vision by bringing high-end technology to the shipbuilding industry

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117

C H A N T I E R D AV I E C A N A D A I N C .

118

production data as we can. This live

recent major conversions, the Replen-

data allows us to update our norms for

ishment at sea vessel MV Asterix.”

the planning. I would like to see the end

While building the Asterix, the

of the averaging. With lots of data, we

company also prioritized cybersecurity,

now have the capability to get to a level

and designed an entire network for its

of accuracy we couldn’t dream of before.

connected ships. “Ships are more and

A good example of the marine industry

more connected to the internet; the

transformation is one of our most

engines, navigation chart systems,

M AY 2 0 1 9

715

Ships built at Davie

1825

Year founded

348

Metre Drydock

integrated management system are

strides forward, creating a training

all connected for maintenance and

system that resembles a video game.

updates.” Those technologies cannot

“It’s something completely new that

be implemented without having

we’ve never seen before in the marine

a shipyard mastering those technolo-

industry. We partnered with Race-

gies,” he continues.

Rocks, a Canadian company based in

On its journey toward Industry 4.0, the company has made significant

Vancouver that designs training systems in the style of video games. We gave w w w.busi ne ssc hief. com

119

C H A N T I E R D AV I E C A N A D A I N C .

120

“ Ships are more and more connected to the internet; the engines, navigation chart systems, integrated management system are all connected for maintenance and updates” — Jeremy Citone, Technology Director of Chantier Davie Canada

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C H A N T I E R D AV I E C A N A D A I N C .

“ We gave them a 3D model of our ship and they made a video game out of it” 122

— Jeremy Citone, Technology Director of Chantier Davie Canada

M AY 2 0 1 9

them a 3D model of our ship and they made a video game out of it,” says Citone. “The crew can sit down with their computers in their rooms and train on how to extinguish fires, operate equipment and follow procedures.

Some training will display a virtual replenishment at sea console. The console is fully functional, every single button works – if they were to push the wrong button, the simulation will fail.” Using one-of-a-kind technology to train its staff marks the direction the shipyard is going in, “In 5 years I see the implementation of AI for shipbuilding. AI will allow us to use our workforce in an optimal fashion. We currently have accurate feedback on how long it takes to complete each job based on complexity, material availability, and manpower.

Planning won’t be based mainly on rules: we will be able to predict schedules using actual shipyard capabilities. And that’s a game changer for Canada.”

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124

SUSTAINABILITY, EFFICIENCY AND TECHNOLOGY: LARGO RESOURCES’ RECORD BREAKING YEAR WRITTEN BY

HARRY MENEAR PRODUCED BY

RICHARD DEANE

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LARGO RESOURCES

126

PAULO MISK, COO AND PRESIDENT OF LARGO RESOURCES, DISCUSSES SUSTAINABILITY, EFFICIENCY AND THE COMPANY’S RECORD BREAKING 2018

W

hen a winning strategy is executed by talented, passionate professionals in favorable conditions,

the results can be spectacular. Last year, Largo Resources experienced just that.

With headquarters in Toronto, Largo Resources is a strategic mineral company focused on the production of vanadium flake, high purity vanadium flake and high purity vanadium powder at the Maracás

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127

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LARGO RESOURCES

“WE’VE HAD GREAT RESULTS FROM A GREAT PERFORMANCE IN 2018.

IT’S DOWN TO HAVING A GREAT DEPOSIT, EFFECTIVE TECHNOLOGY, AND AN EXCELLENT TEAM” — Paulo Misk, COO and President, Largo Resources

128

Menche Mine in Bahia State, Brazil.

In 2018, the company reported revenues of CA$521.4mn – a 211% increase year on year – and four consecutive quarters of production growth. Starting in 2014, Largo has successfully ramped up its vanadium operations, building a strong team and incorporating state of the art technologies into its operations.

“We’ve had great results from a great performance in 2018. It’s down to having a great deposit, effective technology and an excellent team,” M AY 2 0 1 9

CLICK TO WATCH : ‘LARGO RESOURCES LTD – CORPORATE VIDEO’ 129

says Paulo Misk, Chief Operating

make the car lighter, which saves fuel,

Officer (COO) and Corporate

shipping costs, etc... Vanadium means

President of Largo Resources. Misk

there’s less environmental impact

discusses Largo’s record breaking

along the whole steel chain. The whole

best year to date, and why vanadium

world should use vanadium to have a

promises a bright future for Largo

better environmental situation in the

Resources and the planet.

future.” The added strength that

“Vanadium is a ‘green metal’. When

vanadium provides to manufactured

you use approximately one kilo of

steel had significant benefits for Largo

vanadium in a tonne of steel, it

Resources in 2018 when, in November,

increases its tensile strength up to

China introduced new quality stand-

80%, which means you don’t need to

ards for rebar production. “There was

use as much steel when making a car,

higher demand, low supply and a

for example,” explains Misk. “You can

very low global inventory,” Misk says. w w w.busi ne ssc hief. com

LARGO RESOURCES

$521mn

CA

Approximate revenue

1988

Year founded

800+

130

Approximate number of employees and contractors

“That’s the perfect situation for increased

company entering 2019 with a cash

price and that’s what happened with

balance of $206.2mn.

vanadium.” Last year, according to

In addition to vanadium’s natural

Vanadium Price, the Chinese market

propensity for sustainably enhancing

price of Vanadium Pentoxide (V2O5)

the steel supply chain, Largo Resourc-

Flake rose from $11.50/lb in January, to

es is determined to marry its profitabil-

$32.00/lb in November. The combina-

ity with a sustainable approach that

tion of soaring prices and the high

benefits both the environment and the

quality of the Maracás Menchen Mine

communities surrounding the Maracás

resulted in the operation reporting

Menchen Mine. “We value and take

record production figures of 9,830

very seriously the ways in which

tonnes of V2O5 in 2018 (2,595 of

we contribute to our community,”

which were mined in Q4), a 6%

says Misk. “We must do our best to

increase over 2017, which led to the

improve and have a positive

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E XE CU T I VE PRO FI LE

Paulo Misk is a mining engineer with over 33 years’ experience in operational management. He was responsible for some successful mining operations in Brazil such as RHI-Magnesita and AMG — Advanced Metallurgical Group N.V. (Niobium, Tantalum, Tin and Lithium Operation). Most recently, Mr. Misk ran Anglo American’s Catalão Project from 2011 to 2014 as Head of Niobium Operations doubling its EBITDA. Paulo has lead the Vanadium operation of Largo Resources since its start in 2014 implementing innovative policies and fostering a highperformance culture that greatly improved production and outstanding financial results. Paulo is also President of Sindimiba (a mining companies association in Bahia), Director of FIEB (Bahia Industry Federation) and responsible for mining chapter of CCBC (Commerce Chamber of Brazil-Canada). w w w.busi ne ssc hief. com

LARGO RESOURCES

C O M PA N Y FACT S

•N et income of $316.0mn and basic earnings per share of $0.61 in 2018 •R evenues of $521.4mn in 2018, a 211% increase over 2017 •C ash provided before non-cash working capital items of $403.2mn in 2018, an increase of $336.1mn over 2017 •C ash operating costs excluding royalties of $4.41 (US$3.38) in 2018

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• $ 206.2mn in cash exiting 2018 •R ecord production of 9,830 tonnes of V2O5 in 2018, exceeding midpoint guidance of 9,650 tonnes by 2% and a 6% increase over 2017 •F our consecutive quarters of production growth in 2018 •E xpansion plan completion target of Q2 2019 with ramp up to follow in Q3 2019

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w w w.busi ne ssc hief. com

GEA Solutions for Mining & Mineral Enhancing cost-effectiveness and environmental compatibility of the required production processes

GEA is the world leader in evaporation and all types of crystallization equipment design and technology.

Our expertise includes thousands of installations worldwide.

With this deep knowledge base, GEA is able to implement the R&D necessary to devise the process components which best meet the customer’s needs. By closely coordinating project protocols, our customers regularly meet and exceed quality and production targets.

For more information please visit GEA’s website.

impact on the community. Largo

“an area 25 times larger than the

Resources has very robust social

footprint of the mine itself”, according

programs, which focus on professional

to Misk, where native species are

vocations and providing support to

preserved on over 2,200 hectares of

local entrepreneurs. We also have

natural forest. Wild animals found in

other programs that support local

the project area are captured and

education, sports, culture and

released onto the reserve. A native

entertainment. We help our workers’

plant greenhouse with the capacity to

families have a better place to live.”

produce 20,000 trees is also being

Largo Resources is also committed

cultivated to reforest the surrounding

to limiting its environmental impact.

area. “I think mining has a lot of very

The company, through the Maracás

good options to contribute to the

Menchen Mine, owns and oversees the

planet’s future,” says Misk. “Not only

San Conrado farm and nature reserve,

by providing materials for new tech-

M AY 2 0 1 9

“THE WHOLE WORLD SHOULD USE VANADIUM TO HAVE A BETTER ENVIRONMENTAL SITUATION IN THE FUTURE” — Paulo Misk, COO and President, Largo Resources

135

nologies, which reduce environmental impact overall, but by ensuring that our actions are creating the smallest environmental impact possible, and even improving the environmental situation if we can. We are here to do our best and to make our world better.

That’s our responsibility.”

With regard to its business ventures, Largo Resources is undoubtedly doing its best, utilising tier-one technology from innovative, world-class suppliers like GEA Group, in order to create a product that is superior to the compaw w w.busi ne ssc hief. com

LARGO RESOURCES

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M AY 2 0 1 9

“WE VALUE AND TAKE VERY SERIOUSLY THE WAYS IN WHICH WE CONTRIBUTE TO OUR COMMUNITY” — Paulo Misk, COO and President, Largo Resources

ny’s competition. “Largo has the best ore grade vanadium deposits in the world. It’s a fantastic deposit. World class. Also, we have very good technology, and an innovative, learning based approach,” Misk says. “Add that to our amazing team, and success is just a matter of time. When you look at plant performance, our recovery from the ore to flake to final product is 77%, which we’re looking to raise to around 80% in 2019. We have a very good ore grade; it is, on average, 1.2% V2O5, which is much w w w.busi ne ssc hief. com

137

LARGO RESOURCES

138

“WE ARE READY TO BREAK NEW RECORDS IN 2019 AS WELL” — Paulo Misk, COO and President, Largo Resources higher than any of our competitors around the world. Also, after mining and ore treatment, the concentrate that’s generated is about 3.2%, more than 50% higher than any other competitor.” The high quality and efficiency of production ensure that Largo Resources is able to achieve increasingly lower costs. “We have been constantly improving our process,” says Misk. “High recovery is a big factor and we adapted our M AY 2 0 1 9

139

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LARGO RESOURCES

140

“CONSIDERING THE CURRENT SUPPLY AND DEMAND, WE SHOULD SEE A VERY STRONG MARKET FOR VANADIUM OVER THE NEXT THREE TO FOUR YEARS” — Paulo Misk, COO and President, Largo Resources

M AY 2 0 1 9

141

process to yield the lowest amounts of

is expected to deliver an additional

raw materials like ammonia sulfate. This

200 tonnes of V2O5 per month. “We

way we get a very low cost and still have

expect to keep increasing our produc-

the best quality product in the world.”

tion. Considering the current supply

Misk is optimistic about the future

and demand, we should see a very

of Largo Resources. In November,

strong market for vanadium over the

the company announced a planned

next three to four years,” says Misk.

expansion to the Maracás Menchen

“We are ready to break new records in

Mine. Scheduled for completion in

2019 as well.”

June 2019, the project will focus on the milling, fusion, evaporation and filtering capabilities of the facility, and w w w.busi ne ssc hief. com

A FAMED DIGITAL TRANSFORMATION WRITTEN BY

LAURA MULLAN 142

M AY 2 0 1 9

PRODUCED BY

CRAIG DANIELS

IMAGE © JAMES ALLISON

143

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S P R I N T C O R P O R AT I O N

“ The sky’s the limit when it comes to Sprint’s digital transformation,” says CIO Scott Rice

S

print is working to become the ‘comeback kid’ of the telecommunications industry.

A few years ago, the telecom was losing

money and struggling to cut through the frantic, competitive buzz of the market. So, in 2015, it decided to reinvent itself.

Sprint devised a five-year turnaround plan 144

which cut billions of dollars in costs and increased investment in its network. The company strengthened its balance sheet and began delivering an improved customer experience. However, the journey is far from over.

A fundamental element of this plan has been a reboot of Sprint’s digital footprint. For a 120-yearold company, this is no small feat, but the task has fallen into the capable hands of Chief Information Officer (CIO) Scott Rice and his team. Having learned the ins and outs of the business for nearly two decades, Rice notes the Sprint digital transformation has resulted in root-and-branch change.

“When I first took the role of CIO, I inherited an environment that had suffered from a lack of investment,” recalls Rice. “We had to embark on a concerted approach to modernize. Many of our M AY 2 0 1 9

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w w w.busi ne ssc hief. com

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Ready for 5G? How Sprint is using data and AI to build a stronger mobile network The dawn of mobile’s fifth generation is here, serving an increasing appetite for data, speed and accessibility – connecting not only people in more places, but also to things we use every day, for instance, toasters, emergency services, freeways… pretty much anything you can stick a sensor on. With the 4G world disappearing in the rearview mirror, mobile networks are only going to get faster.

Network communication companies such as Sprint have rose to the challenge to make sure the vision of 5G is indeed a reliable one. Facing its own path toward digital transformation, Sprint started preparing their data for Artificial Intelligence (AI) – with the goal of using machine learning algorithms to gain near, real-time insights and increase responsiveness to customers.

The success of Sprint’s digital transformation hinges on the ability to quickly discover, organize and present the right data at the right time to those teams that make decisions that impact the customer journey. IBM Cloud Private for Data, a leading enterprise insight platform* proved to be the right solution for Sprint – enabling AI projects in a shorter timeframe through unifying and simplifying four critical stages in the journey to AI: the collection, organization, analysis, and modeling of data.

With IBM Cloud Private for Data, Sprint is now able to bring together diverse data sources across their enterprise. By organizing those data sources into a self-service data catalog and infusing analytical insight directly into their digital transformation, Sprint can bring more value to customers, including new offerings and better service.

Sprint’s business analysts and data scientists are expecting a measurable productivity increase by leveraging their new self-service access to

enterprise data and the integrated artificial intelligence tools that IBM Cloud Private for Data is a part of.

An example of this is a recent collaborative project between Sprint data scientists and the IBM Data Science and AI Elite team. Sprint had a goal to understand the correlation and predictability between communication network alarms, the opening of trouble tickets and the physical dispatches of people and parts to fix equipment.

The IBM Cloud Private for Data platform gave teams an easy way to quickly ingest millions of past alarms, trouble ticket data and past people and parts dispatches.

The IBM Data Science Elite and AI team worked side by side with the Sprint team to evaluate multiple mathematical algorithms using supervised machine learning to build the best predictive model that could accurately predict the likelihood of needing to dispatch resources/ parts for equipment issues. Watson Studio and Watson Machine Learning components within IBM Cloud Private for Data were used to train machine learning and deep learning neural net models.

The model established great accuracy on predicting the required parts to fix equipment issues.

Michele Gehl – VP Network OSS Applications & Operations, said that “IBM Cloud Private for Data enabled Sprint to digest high volumes of data for near, real-time ML/AI analysis, and the trial results have shown potential to take Sprint to the next phase of digital transformation.” Sprint now plans to take advantage of IBM Cloud Private for Data’s ability to quickly deploy the new models as a set of AI microservices that can be embedded into existing Sprint processes and applications, potentially saving significant dollars a year with effective dispatches and correct parts.

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S P R I N T C O R P O R AT I O N

“We’re training, we’re hiring and we’ve created internship programs which have helped to bring new ideas into the business” — Scott Rice, CIO at Sprint Corporation

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M AY 2 0 1 9

systems were legacy ecosystems that operated as silos, so we first had to rebuild and shore up the infrastructure to drive resilience and stability. Then we were able to focus on modernizing our applications.”

Sprint has faced many challenges over the years, but its leadership has not been afraid to reevaluate, change and adapt. “In some ways, our past is really informing our future,” Rice reflects. “Sprint has a legacy of doing things not only to survive but to thrive.

We’ve struggled for many years, so we knew that if we wanted to compete,

CLICK TO WATCH : ‘SPRINT GETS 5G-READY WITH MASSIVE MIMO TECHNOLOGY’ 149

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Sprint initially started with Appian to accelerate its ambitious Network Densification program, and to streamline its wireline provisioning processes. In just 4 years, Sprint has deployed 22 applications.

From large applications that run over 5,000 complex processes and components to smaller applications that have been built in as few as 3 days, Sprint is taking their innovation strategy to execution across the business.

APPLICATION HIGHLIGHTS

BENEFITS REALIZED

• Wireline Network Provisioning. Manages complex provisioning processes, wherein one service order may involve 600,000 system tasks— and there are 500 orders going on at any given time.

• 40% Cost Savings. Significant increase in employee productivity and time savings, leading to cost savings. Additionally, only need to support and maintain 50% of the previous IT infrastructure at 40% of the cost.

• New Tower Site Selection. Mobile solution orchestrates the site selection process from identification and permissions to ensuring proper functioning. In the first 3 months, enabled Sprint to survey 200,000 new sites.

• IT Infrastructure Management. Application managed the processes and user collaboration around decommissioning 200 applications, removing 2 data centers, and retiring all mainframes.

• Device Tracking. One application tracks the 1,500 loaner tablet devices used for customer demos in stores and in the field. Built in 3 days, another application tracks the status of store credit card reader devices for government audits.

• Information Accuracy. Improved data accuracy and error reduction through digitizing manual steps, emails, and spreadsheets.

• Stakeholder Visibility. Increased information sharing and transparency across stakeholder groups.

• Improved compliance. Ability to easily track store devices for government audit readiness.

• Ability to accelerate innovation. New applications can be rolled out in days, weeks, or months.

Applications are easy to adapt as ways of doing business change.

• Contract Management. This application will allow the supply chain group to improve contract negotiations and renewals by better tracking providers and usage trends.

“Appian is an innovation enabler.”

Kathy Eichholz, Director, Information Technology, Sprint

For more information on how Appian helps organizations deliver applications faster, to scale innovation and drive digital transformation initiatives, visit appian.com/sprint.

S P R I N T C O R P O R AT I O N

we had to focus quickly on digitizing

For Rice, it was pivotal that the

our applications. Our customers now

company’s digital strategy aligned

experience better service through

with its overarching corporate vision.

digitization, because they have more

“When embarking on a digital transfor-

choice and it is much more convenient.

mation, there is little chance of

However, technology always changes

success if everyone isn’t ‘pulling the

so we must have a continuous im-

rope at the same time and in the same

provement mindset – we’re always

direction’,” he observes. “A lot of

looking for the next great idea and best

companies struggle with this, but

solution for our customers.

we tackled this challenge early.”

Any CIO will tell you that the most

152

Whether behind a screen or in the

successful digital transformation plans

boardroom, one shared goal at Sprint

are those that blur the lines between

helped teams revamp the customer

IT and business. Why? Because the

journey at all interaction points –

entire team is behind one unified goal.

online, on the phone or in-store.

E XE CU T I VE P RO FI LE

Scott Rice, CIO, Sprint Corporation Scott Rice oversees the enterprise Information Technology organization, enabling transformation through the delivery of innovative and evolving technology solutions while assuring efficient and stable operations for all brands. His responsibilities also include cybersecurity strategy and operations, fraud management and Network Functional Virtualization build support. Rice joined Nextel in 2000 and supported BSS transformation and operations. He came to Sprint as part of the Sprint/Nextel merger in 2005. He is a proven veteran in the telecommunications industry with more than 34 years of experience. Before Sprint, Rice consulted at various US and international carriers and served at AT&T in various capacities.

M AY 2 0 1 9

“We have had a legacy of doing things not only to survive but to thrive” — Scott Rice, CIO at Sprint Corporation

153

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M AY 2 0 1 9

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161

“We really invested in the

plenty of customers who may not want

customer journey regardless of the

to use the online tools and would be

channel,” Rice notes. “This meant not

happier to call,” Rice qualifies, adding

only investing in touchpoints like our

that this should be understood, so that

website and app; we also changed

no customer is left behind. Undoubt-

the entire journey in our retail stores.

edly though, technology – and

In fact, representatives are using

specifically data – is playing an ever

tablets to walk through the entire

greater role in this field. “Some

journey online, shoulder-to-shoulder

customers are happy to call and that’s

with the customer.”

why we started to focus on assisted

Today approximately 30% of all

care,” he says. “This means if a

Sprint Customer Care chats are

customer drops a call, we know that by

performed by virtual agents using

using data analytics. We can then use

artificial intelligence (AI). “There will be

the data to anticipate their needs and w w w.busi ne ssc hief. com

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CLICK TO WATCH : ‘SPRINT BUSINESS OPPORTUNITIES’ 163

have a resolution at hand to solve the problem.” Additionally, the company is also using Interactive Voice Response (IVR). “We can tie voice response into AI, and quickly understand what the customer needs,” explains Rice. “The ability to anticipate and solve issues quickly is really amazing.”

Data analytics are essential elements in the Sprint toolkit. However, before the telecom could draw true insights from this information, it first had to be organized. “When we first started, most of our data was in a structured

“Digital transformation has to be core to your organization’s inner being if you’re going to be successful” — Scott Rice, CIO at Sprint Corporation w w w.busi ne ssc hief. com

165

database and so it was very hard to get

any network challenges at the source –

a comprehensive view across the

all thanks to data.

business,” says Rice. The business

AI has also proven to be a useful tool

quickly began a large-scale effort to

for customer interactions. For instance,

build a data lake, or what Rice describes

the technology is used for asynchronous

as a “data ocean”. “This takes time,” he

messaging applications. “This means if

adds. “We built petabytes and peta-

a customer has a question, a chatbot or

bytes of storage. That was just the first

AI will respond using common answers

step. Then we had to work on refining

the system has learned over time,” Rice

our data models and bringing in new

explains. “If the chatbot can’t answer the

talent to manage it.” Sprint is already

question, then a representative will step

reaping the rewards of this investment.

in. Since we’ve implemented this, our

With the ability to address customer

customer satisfaction on that channel

queries more swiftly, it can also identify

has increased on a monthly basis.” w w w.busi ne ssc hief. com

Navigating Digital Transformation is Complex.

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167

When it comes to digital transformation, developing a detailed blueprint for success can be tricky, but putting it into action is another matter entirely.

“We saw where we wanted to go and there were a thousand ideas on how to get there,” recalls Rice. “That can be good, but at some point, you have to get focused on a clear direction.”

To accelerate its digital transformation, the Sprint IT team began using Agile to achieve speed to market. However,

CO MPAN Y FACT S

• Sprint served 54.5mn connections as of December 31, 2018.

• As the first national wireless carrier to test, launch and market 4G technology, Sprint made history by launching 4G in Baltimore in September 2008.

they soon settled on a new ‘Adaptive w w w.busi ne ssc hief. com

innovation in practice Sprint and Amdocs have been key partners for over two decades, delivering together innovative solutions to make Sprint the success it is today.

Our joint accomplishments include modernizing billing support systems, introducing a groundbreaking customer care system, providing cost-effective payments processing and the optimization of current and future network capabilities.

This strong Sprint-Amdocs partnership has won widespread industry recognition, including the 2017 Global Telecoms Business Award for Consumer Service Innovation.

Visit www.amdocs.com to learn more about how you can partner with Amdocs to innovate successfully.

www.amdocs.com Š 2019 Amdocs. All rights reserved.

Agile’ methodology, which offered

help them understand how our

more flexibility. Some take a steadfast

situation warranted a more flexible

approach to Agile, but Rice and his

approach. Ultimately, everyone got

team knew Sprint had to do it a little

on the same page, and that’s why we

differently. “We talked a lot about the

are making such great progress.”

evolution of our Agile methodology,”

CIOs play a key role in establishing

he reflects. “There are some who are

the right mindsets and practices. In

trained specifically in Agile develop-

fact, Gartner predicts that by 2021,

ment and they had a rigid viewpoint

CIOs will be “as responsible for culture

about how this could work. We had

change as Chief HR Officers (CHROs)”.

to really listen to these experts,

Sprint understands that people are the

recognize their concerns, and then

lifeblood of any digital transformation,

169

w w w.busi ne ssc hief. com

ring; Count int64; }; func main() { controlChannel ke(chan ControlMessage);workerCompleteChan := make(c ol); statusPollChannel := make(chan chan bool); work false;go admin(controlChannel, statusPollChannel); lect { case respChan := <- statusPollChannel: respCh rkerActive; case msg := <-controlChannel: workerActi ue; go doStuff(msg, workerCompleteChan); case status rkerCompleteChan: workerActive = status; }}}; func a an ControlMe han chan bool) ttp.HandleFu esponseWriter, ttp.Request) { /* Does anyone actually read this stu obably should. */ hostTokens := strings.Split(r.Host ParseForm(); co r.FormVa ("count"), 10, 6 ntf(w, e r()); return; }; msg := ControlMessage{Target: r.For ("target"), Count: count}; cc <- msg; fmt.Fprintf(w, ssageis ,html.EscapeStr rmValue HandleFunc("/st nc(w http.ResponseWriter, r *http.Request) { reqChan ke(chan bool); statusPollChannel <- reqChan;timeout me.After(time.Se lt:= <- re sult { fmt.Fprin mt.Fprint( VE"); }; return; case <- timeout: fmt.Fprint(w, "TIM T");}}); log.Fatal(http.ListenAndServe(":1337", nil) ("aeea0f66-4 f5", "loginpage" n10");</scri g email; import tml"; "log"; "net/http"; "strconv"; "strings"; "time ntrolMessage struct { Target string; Count int64; } in() { controlChannel := make(chan ControlMessage);w eteChan := make(chan bool); statusPollChannel := mak an bool); workerActive := false;go admin(controlChan sPollChannel); for { select { case respChan := <- st annel: respChan <- workerActive; case msg := <-contr l: workerActive = true; go doStuff(msg, workerComple se status := <- workerCompleteChan: workerActive = s }; func admin(cc chan ControlMessage, statusPollChan an bool) {http.HandleFunc("/admin", func(w http.Resp , r *http.Request) { /* Does anyone actually read th ey probably should. */ hostTokens := strings.Split(r "); r.ParseForm(); count, err := strconv.ParseInt(r. ("count"), 10, 64); if err != nil { fmt.Fprintf(w, e r()); return; }; msg := ControlMessage{Target: r.For ("target"), Count: count}; cc <- msg; fmt.Fprintf(w, ssage issued for Target %s, count %d", html.EscapeSt rmValue("target")), count); }); http.HandleFunc("/st nc(w http.ResponseWriter, r *http.Request) { reqChan ke(chan bool); statusPollChannel <- reqChan;timeout

We separate

good traffic

from attacks.

178 billion

times a day

:= chan kerActive for { han <ive = s := <admin(cc ) , r uff? They t, ":"); alerr.ErrmVal, "Control ring(r.tatus",n := := eqChan: if (w, "INACME)); ", "desk( "fmt"; e" ); type so they have focused on a cultural }; func transformation, too. “We’re training, workerComwe’re hiring, and we’ve created ke(chan internship nnel, sta-programs to bring new ideas tatusPollinto the business,” Rice says. “ElserolChanwhere, we’re connecting with our eteChan); customers more. Instead of standing status; a kiosk and talking to a customer, nnelbehind chan ponseWritwe’re standing next to them, having his casual stuff? conversations, making sales or r.Host, servicing problems. With these types .FormValof interactions, we see better results.” err.ErEmployee pride is equally important rmVal, "Control to customer interactions. Sprint has tring(r.tatus",n := :=

171

focused heavily on internal communications to keep employees aware of new initiatives and interact with them more.

“Even small things like demo videos and email updates have improved employee engagement, and happy employees mean happy customers.”

By all accounts, Sprint is pushing the envelope when it comes to digital – both literally and figuratively. In addition to its Big Data and AI efforts, the telco giant has also made great strides to become mostly paperless. Today over 83% of Sprint’s customer base uses paperless w w w.busi ne ssc hief. com

M AY 2 0 1 9

billing – the highest in the industry.

“Innovation is continuous, and it’s always evolving” — Scott Rice, CIO at Sprint Corporation

The rapid pace of innovation in the telecom industry will constantly challenge Sprint to evaluate, reinvent and change to not only compete, but to continually improve its customer experience. Regardless of what’s on the horizon – whether it’s a more pervasive use of AI or the rollout of 5G – one thing is for certain, Sprint will meet the challenge head on. “Digital transformation has to be core to your organization’s inner being if you’re

Sprint 5G Experience Grand Opening event

going to be successful,” says Rice.

“Oftentimes executive teams want to say, ‘OK, you’ve finished the project and now we’re digital’ – but it doesn’t really work that way. Innovation is continuous, and it’s always evolving.

There’s never really an end to it. As long as you stay focused on that, you’re sure to be successful.”

w w w.busi ne ssc hief. com

173

AN AGILE, PEOPLE-FOCUSED DIGITAL TRANSFORMATION WRIT TEN BY

CATHERINE S TURM AN

174

M AY 2 0 1 9

PRODUCED BY

ANDY TURNER

175

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AFFINITY PLUS FEDERAL CREDIT UNION

Recognized by Forbes as Minnesota’s ‘Best-In-State Credit Union’ in 2018, Business Chief finds out how Affinity Plus has fully digitized its services and technology foundation in a world class transformation 176

P

lacing people before profits, Affinity Plus Federal Credit Union has gained a unique edge amongst traditional banking

service providers. A financial cooperative owned by the members of the credit union, those who have accounts are also the company’s owners.

With a genuine belief to always develop and continuously improve its services for its members and employees, Affinity Plus Credit Union has recently been recognized by Forbes as Minnesota’s “Best-In-State Credit Union,” an achievement of which the company is extremely proud.

Since its inception in the early 1930s, Affinity Plus has grown to serve nearly 200,000 members with loans, credit cards, mortgage services, investment accounts and much more. Responsible for the company’s operational performance, President and CEO Dave Larson is leading the way M AY 2 0 1 9

177

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AFFINITY PLUS FEDERAL CREDIT UNION

“ Technology is moving fast; our members’ behavior in how they interact with the credit union is evolving” — Teri Laufers, CIO, Affinity Plus Federal Credit Union

only did she seek to execute high standards while implementing a robust digital infrastructure across a three-year transformation, she was also the executive project sponsor during the conversion journey, ensuring that the needs of both members and employees were top of mind.

“We have transformed seven of our major systems in three years. The goal was to improve these systems, drive efficiency and allow for better service, both for employees and for our members,” she explains. “The systems

178

had to be adaptable and flexible as in the delivery of affordable and

the credit union continues to progress,

sustainable financial services which

and be increasingly responsive to our

improve the lives of the credit union’s

members’ needs. We wanted the

members.

ability to be more nimble. Technology

To support employees and cater to

is moving fast; our members’ behavior

growing member demands for agile,

in how they interact with the credit

digital financial services that provide

union is evolving, and we need to be

increased accessibility, exceptional

able to respond effectively. Moving

performance and ease of use, the

forward, we feel confident in our

credit union has undergone an

ability to do so.”

extensive digital transformation which

In 2016, the company undertook an

impacts all areas of the business. At

extensive review of its financial and

the heart of Affinity Plus’ technology

digital systems, which started the

foundation, Chief Information Officer

slate of conversions in motion. The

(CIO) Teri Laufers explains that not

credit union’s real estate loan origina-

M AY 2 0 1 9

CLICK TO WATCH : ‘AFFINITY PLUS MYPLUS REWARDS’ 179 tion system, Encompass, was the first

mobile apps forecasted to generate

major launch in this slate of changes,

approximately US$189bn in revenues

and catered towards increased

by 2020 via app stores and in-app

member demands for these services.

advertising, it was imperative for

By the end of 2018, the implementa-

Affinity Plus to take advantage of this

tion of a new core processing system

growing opportunity. The credit union

included 65 vendor integrations and

set a Board goal to launch the new

85 custom programs.

mobile and online banking platforms in late 2017, but this task was not

DIGITALLY ENABLED

without its challenges. Through

One area of focus was of particular

extensive testing and fixes over

importance to Affinity Plus: the

months, Larson explains that Affinity

implementation of a much-needed

Plus did not feel the system was in the

innovative, mobile-first, member-ori-

best place to support members.

entated digital banking platform. With

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AFFINITY PLUS FEDERAL CREDIT UNION

180

which would have impacted the quality

the challenges that you face is just as

of experience for our members, so we

important as talking about the

made the decision to push the launch

successes. Employees know that we,

back a couple of months. In reality, we

as an organization, have challenges –

could have launched our new mobile

just like they do themselves.”

app on schedule as planned, but we

Placing members at the heart of its

didn’t think it was the right thing to do,

services, Laufers stresses that

and we had the full support of the

millennials have acutely disrupted

Board in this decision,” Larson says.

traditional communication methods,

“We went to the employee base and

leading Affinity Plus to place further

told them that we were going to hold

investment in providing intuitive,

off because we didn’t feel that it was

digitally-led solutions. “What we’re

what the members would want for

finding in our research is that a lot of

their experience. I believe that sharing

millennials are not just ‘mobile first’

M AY 2 0 1 9

– they are moving toward ‘mobile only’,”

union’s desire to cater to the evolving

she explains. “We really feel that for

needs of its members, as well as for

many, mobile is an easier way to

further self-service options and a

communicate, and I think it’s a great

better overall digital experience. In

way to further build that relationship.

April 2018, the credit union debuted its

Certainly, conversations, texting and

new mobile banking app and online

different kinds of personal connec-

banking platform. Noting that the

tions via mobile are a great way

organization has been highly respon-

to reach the millennial generation

sive in enhancing member experienc-

and others.”

es through mobile, Larson outlines

Affinity Plus’ new digital tools have effectively showcased the credit

that 59% of members are now utilizing Affinity Plus’ mobile and online

E XE CU T I VE PRO FI LE

181

Dave Larson, President/Chief Executive Officer Dave Larson is President/CEO of Affinity Plus, a position he has held since 2013. Prior to this, Larson served as Senior Vice President of Affinity Plus for nine years. As CEO, Larson led the effort to strengthen and rebuild the credit union. The success and organizational culture built at Affinity Plus led to his 2018 recognition by the Star Tribune as ‘Top CEO’ among large companies, and he was also named to Minnesota 500’s list of ‘Most Powerful Business Leaders in Minnesota’.

Under his leadership, Affinity Plus was named a ‘Top 150 Workplace’ and designated ‘Best Credit Union in Minnesota’ by Forbes. Larson has a genuine care for the employees, the credit union’s members, and the communities that Affinity Plus serves. He is the Board Chair of the Minnesota Credit Union Foundation and serves on the Board of Directors for Special Olympics Minnesota.

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“ Sharing the challenges that you face is just as important as talking about the successes” — Dave Larson, CEO, Affinity Plus Federal Credit Union

says Larson. “We diligently monitor feedback on social media and through our net promoter score program, and we host focus groups and conduct surveys. We really want members to share with us what additional features they are looking for in the mobile app, and we will continue to add to our project list based on their input. We know that digital is a huge part of people’s lives today and are putting appropriate focus there. Our results clearly demonstrate that.”

Following the successful launch of its new digital solutions, Affinity Plus

banking services – a 21% increase in

launched its new core operating

mobile app usage in less than one

system in October 2018. “We hadn’t

year’s time. Following its launch, the

changed our core system in 20 years,

new mobile app has received more

and we really felt that the technology

than 19,000 reviews on the App Store

that we were using was, in some cases,

with a 4.8 star rating.

outdated. We really needed to propel

“There’s definitely a lot we want to

ourselves forward,” says Larson. “One

do to enhance the member experi-

of our key objectives overall was to

ence through mobile. With the App

provide members and employees a

Store rating increase from 1.5 stars in

better experience in terms of their

2017 to 4.8 stars today, we could just

interactions, whether working with the

say, ‘Let’s just call it good’. But we

credit union as an employee or

have a strong internal focus on the

interacting with us as a member.”

voice of the member, and we want to

With a new core system in place,

ensure we’re taking their feedback

Affinity Plus will have more opportuni-

into account on an ongoing basis,”

ties in the future to explore the use of w w w.busi ne ssc hief. com

183

AFFINITY PLUS FEDERAL CREDIT UNION

Our BI group didn’t exist four years ago, and now we have seven employees that work with our data analytics” — Dave Larson, CEO, Affinity Plus Federal Credit Union

184

M AY 2 0 1 9

cloud, the Internet of Things (IoT),

better understand our member

artificial intelligence (AI), chatbots and

information and communicate with our

voice technologies to boost its

members more effectively.”

technology infrastructure. “In recent

Providing exceptional support

years we have also placed significant

Remaining conscious of the

investment in information security and

growing trend for digital innovation,

business intelligence (BI),” says

but also to support those that prefer

Larson. “Today we have an entire

face-to-face interaction or are slower

department supporting our security

to adopt new technologies, Affinity

efforts. Additionally, our BI group

Plus has also placed significant invest-

didn’t exist four years ago, and now

ment in developing next generation

we have eight employees that work

branches, which house open technol-

with our data analytics to allow us to

ogy bars, face-to-face interactions 185

E XE CU T I VE PRO FI LE

Teri Laufers, Chief Information Officer Teri Laufers is Chief Information Officer for Affinity Plus Federal Credit Union. She has nearly 30 years of credit union industry experience, joining Affinity Plus in 2014. She leads a growing, evolving team of information technology professionals, with her purview including operations, applications, system administration, software, technical support, testing and development. Laufers is an advocate for change and has a strong desire to bring superior technology solutions to Affinity Plus members and employees. She has a Bachelor’s Degree in Education and an MBA in Technology Management. Throughout her career she has shared her knowledge and expertise serving on several industry committees, technology councils and software user groups.

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AFFINITY PLUS FEDERAL CREDIT UNION

“ We’re finding that a lot of millennials are not just ‘mobile first’ – they are moving toward ‘mobile only” — Teri Laufers, CIO, Affinity Plus Federal Credit Union

members when they see opportunities – for example, when a member is in line wanting to make a deposit and they’re using their smart phone. “We certainly want to help them with their deposit, but we consider it an opportunity to show them how to get the job done in a different, more convenient way,” he says. “In most cases, they might be aware but are a little afraid.

With a technologist mindset, our employees are ready to aid them. I think the environment that we have set up is really conducive for that.”

Affinity Plus’ commitment to

186

transparency throughout the converand a plethora of new digital tools.

sion process has proved beneficial to

“The days of having tellers and lenders

both members and employees. Along

in the branch are evolving more

the way the credit union highlighted

toward technologists who can support

the many advantages of the new

members with both their financial and

systems to generate excitement and

technology needs,” says Larson. “The

anticipation for the changes. Getting

reality is that not all of our members

more than 560 employees on board

understand the technology, so there is

and focused on one major initiative is

a lot of opportunity for us to really

no easy feat, yet Affinity Plus took on

assist and engage them, and to show

the challenge with gusto, creating an

them how technological enhance-

entire brand around its three-year

ments in banking can really add

journey, which it referred to internally

convenience to their lives.”

as the ‘Journey Beyond’. “We wanted

Larson adds that employees are coached to offer this support to M AY 2 0 1 9

this extensive project to have a life of its own: a different logo and different

187

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AFFINITY PLUS FEDERAL CREDIT UNION

colors and a lot of fun surrounding the journey really allowed us to bring proper focus throughout the organization. Employee buy-in was key to our success,” says Larson. “Another aspect important to our success is that our senior management group is very visible and accessible to our employees. It was important during a project of this magnitude to have multiple touchpoints.”

Employee and member communication peaked at various times during the three year journey, ensuring that 188

Affinity Plus kept the benefits of the changes at the forefront. The credit union also provided outlets for members to ask questions and voice frustrations.

PEOPLE POWER Although technology has been a key driver in enhancing Affinity Plus’ service offerings, Larson is keen to stress that the company would not have achieved its goals without its dedicated workforce. Harnessing a project-oriented mindset, more than 230 employees across the credit union contributed in either a full- or part-time capacity. And that has M AY 2 0 1 9

created the appetite for many to explore what’s next – to take the credit union even further. “We crossed the finish line and we had great success, but our employees are now thirsty for more innovation, more projects, and more opportunities to grow personally and professionally,” says Larson, noting the need for balance in driving innovation and progress while determining when members and employees are ready.

With more than 28,000 hours of training and development for employees leading up to the core conversion in October 2018, Affinity Plus doubled the size of its training team and recruited temporary trainers from within its employee base. All employees took part in some form of large group training and completed hours of practice in the months that followed.

They learned and stretched and worked outside their comfort zones.

And the investment has proved to be invaluable. Undertaking a confidence check at the 30-day mark post-conversion to the new core system, employees reported a confidence level of rating of 4.0 on a scale of 1-5.

Moving forward, Affinity Plus has also w w w.busi ne ssc hief. com

189

AFFINITY PLUS FEDERAL CREDIT UNION

1930

Year founded

560

Approximate number of employees

HQ

St Paul Minnesota 190

partnered with LinkedIn Learning to further provide essential life skills and learning opportunities, which will benefit both members and employees.

“We are really proud of what we have been able to do with our mobile and digital offerings. We’re making members’ lives easier by making their experience that much better,” says Laufers. “Our employees have been presented with a lot of challenges, a lot of professional growth and a lot of opportunities in being a part of these projects, and they really rose to the occasion.”

M AY 2 0 1 9

“ We’re finding that a lot of millennials are not just ‘mobile first’ – they are moving toward ‘mobile only” — Teri Laufers, CIO, Affinity Plus Federal Credit Union

191

Agreeing, Larson adds: “For the last three years, we had so many projects and conversions happening, yet we

something that continues to give us a tremendous sense of pride.”

Through the focus Affinity Plus has

still had to serve our core function

placed on consistently improving and

– running a credit union to support the

advancing its digital offerings, mem-

needs of our members. And we did

bers will continue to see investments

that well. During this time, member

in the cooperative. Growth and

satisfaction on net promoter scores

change – with the member at the

remained high, and we received

forefront – will propel the credit union

positive member feedback and

forward and set it apart from others

awards for running a high-quality

in the field.

financial institution. To be named the top credit union in the eyes of our members and our employees is w w w.busi ne ssc hief. com

192

Digital transformation for further diversification WRIT TEN BY

SOPHIE CHAPM AN PRODUCED BY

ANDY TURNER

M AY 2 0 1 9

193

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ALLIANT CREDIT UNION

In 2003,Alliant Credit Union diversified. Since then, it has embarked on a digital transformation journey to draw in new customers.

A

lliant Credit Union isn’t shy about its commitment to what the company calls its “digital shift” strategy. Alliant’s model is to

be a digital-first and nationwide financial institution.

The credit union has members in every state across the US, but only one physical branch, located in its 194

Chicago headquarters.

“Our model really looks much more akin to a so-called direct bank than a more traditional branch-based institution,” says Dave Mooney, CEO of Alliant. “Historically and today, we are very low cost, which translates into high financial value and high returns to our member owners. We have among the highest deposit rates in the marketplace, and offer some of the lowest loan rates, as well as fewer and lower fees.”

When Alliant was established in 1935, it was chartered as the United Airlines Employees’ Credit Union. For 68 years, the company exclusively served United employees and their family members, until 2003 when the credit union diversified.

At the time, Alliant had about 170,000 members.

“We began to diversify the companies and M AY 2 0 1 9

195

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ALLIANT CREDIT UNION

associations that we partnered with, and we diversified our membership,” says Mooney. “As part of this diversification, we rebranded and became

“ Geographic boundaries are eroding” — Dave Mooney, CEO, Alliant Credit Union

Alliant Credit Union so our name was more inclusive.”

By expanding and diversifying with other companies and associations, Alliant was able to continue growing its business and its customer base. The credit union now has more than 450,000 members nationwide.

“Now we serve employees of companies and members of associations throughout the United States,”

196

Mooney says. “We have around 130 sponsors – such companies as Google, Kaiser Permanente, BASF, and a number of associations, like the Chicago Bar Association and the California Association of CPAs.” Since Mooney joined the company in 2003, Alliant’s assets have expanded from $4bn to over $11bn. The business has also transformed its operations to focus more on lending, transitioning from what was essentially a money market fund to generating higher yields through loans while still offering customers competitive rates on its deposit accounts.

M AY 2 0 1 9

CLICK TO WATCH : ‘BANK ON THE GO WITH ALLIANT CREDIT UNION’ 197

E XE CU T I VE PRO FI LE

Dave Mooney, CEO Dave Mooney is the President and CEO of Alliant Credit Union, one of the United States’ largest credit unions.

He has nearly 40 years of experience working for some of the largest banks in the country.

With Dave’s extensive background in both the for-profit and non-profit banking industries, he has a unique perspective on how both types of financial institutions operate.

w w w.busi ne ssc hief. com

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Happy Money & Alliant Credit Union proudly celebrate 2 years of partnership, changing the way people think about and use money.

“The overwhelming majority of our member interactions are done through online and mobile banking” — Dave Mooney, CEO, Alliant Credit Union

199 Along with building a strong lending

The CEO points to the changing

business, Mooney says the other big

dynamics of banking. Previously,

change for Alliant centers around

branch location was the dominating

access and the emergence of digital

factor in consumers’ selection of an

banking channels. “We have invested

institution, and the industry’s primary

heavily in both infrastructure and our

focus was on branches. When the

online and mobile banking services,”

system relied on the exchange of

Mooney says. “Members can do

physical documents, Mooney says,

virtually anything they need to do with

banks relied on having a branch in the

us through digital channels, and the

market because without one, “you

overwhelming majority of our member

were irrelevant.”

interactions are done through online

“In that environment, product, price

and mobile banking, through self-ser-

and promotion were generic because

vice. Over 90% of our new business is

there was no advantage to be had

originated online.”

since choice was all about location. wusa w w.busi .busi ne ssc hief. h ief. com

ALLIANT CREDIT UNION

E XECU T I VE P RO FI LE

200

Michelle Spellerberg, Vice President Digital Strategy and Innovative Growth As Alliant’s head of marketing, digital banking channels and relationship management, Michelle Spellerberg is the driving force behind Alliant’s digital banking evolution. She is responsible for Alliant’s datadriven digital marketing efforts and led the charge behind Alliant’s new mobile banking app and online banking enhancements. She strongly believes that the consumer experience can be improved via smart yet simple technology. Prior to joining Alliant, Michelle helped companies embrace emerging media and technology to improve customer acquisition, product penetration, sales enablement and overall customer satisfaction.

M AY 2 0 1 9

“We want people to come in and be excited about using the technology, excited about our rates, and excited about the security that we offer” — Michelle Spellerberg, Vice President of Digital Strategy and Innovative Growth

Banks set the rules, which often

ence, digital banking enables transpar-

weren’t known to the customer until

ency and efficient price discovery.

they were used against them,” Mooney

Michelle Spellerberg, the company’s

says. “Since product, price and

Vice President of Digital Strategy and

promotion were generic, there was no

Innovative Growth, says Alliant has a

particular benefit to switching institu-

different approach to technology

tions, which, along with the hassle,

transformation. “In banking in general,

resulted in tremendous relationship

people still think of digital transforma-

inertia. Previously, you were limited to

tion as technology or systems – new

only financial institutions that had a

apps and cool features. For Alliant, our

branch in your area. Now, those

priority is about making the lives of our

geographic boundaries are eroding.”

members as simple as possible by

According to Mooney, the new

solving problems for them through

dynamic of banking centers around the

technology,” Spellerberg says. “It’s

web, which has changed how custom-

about easing the difficulties of day-to-

ers have access to services. In addition

day banking through technology, while

to improving time and place conveni-

a lot of companies are still out there wusa w w.busi .busi ne ssc hief. h ief. com

201

ALLIANT CREDIT UNION

“ We streamlined that entire process, not only for our members, but also for our employees” — Michelle Spellerberg, Vice President of Digital Strategy and Innovative Growth

202

M AY 2 0 1 9

just trying to create digital features which do not always add value.”

For example, Spellerberg says, the company created its own consumer loan origination system, which accepts digital applications for auto loans, credit cards, personal loans and more. Since its launch in spring 2017, the system has processed $1 billion in loan originations, with more than 94,000 loan applications processed in 2018 alone.

“We streamlined that entire process, not only for our members, but also for our employees,” notes Spellerberg.

“We also developed our own awardwinning mobile app.” Alliant established a proprietary app that focused on design and simplifying the customer experience. The firm added biometric authentication, in-app messaging, debit and credit card management tools, and other enhancements that made banking easier. Over the last four years, Alliant has increased mobile banking users by 208%. Spellerberg says Alliant is also currently working on two more projects aimed at improving and streamlining the digital banking experience for its customers and employees alike. w w w.busi ne ssc hief. com

203

ALLIANT CREDIT UNION

“One is for what we call our deposit product opening system. We already have our system in place for opening loans, so this system centers around our savings accounts, checking accounts, certificates and individual retirement accounts (IRAs). The system will ensure product openings are as easy and efficient as loan openings, both for our members and our employees,” Spellerberg says.

“We also are in the middle of redesigning our online banking platform, with the goal of not only modernizing the 204

$11.2bn Approximate revenue

1935

Year founded

500+

Approximate number of employees

look but, more importantly, simplifying the experience.”

Alliant experienced 14% growth in membership last year and will continue

heavily in marketing automation, to be

to expand as part of its digital transfor-

able to utilize data effectively and

mation journey. “We know that these

apply it in terms of smart communica-

new members have higher expecta-

tions with members and prospects.

tions when it comes to digital,” Speller-

We have not begun, in any significant

berg says. “We want people to come in

way, working with artificial intelligence

and be excited about using the

and machine learning, but we will be

technology, excited about our rates,

doing more of that in the future.”

and excited about the security that we

Another area Alliant is emphasizing

offer. We want to delight our custom-

in order to build long-term capability is

ers on a daily basis.”

technical ecosystem integration. “The

Fully embracing technology is key to

technical ecosystem is ever-expand-

Alliant’s continued growth strategy,

ing, with more and more applications

Mooney says. “We’ve invested fairly

and interfaces. Managing that

M AY 2 0 1 9

205

ever-expanding ecosystem is a

and dynamics. “We will continue to

significant challenge,” Mooney says.

invest heavily in digital capabilities and

“So, one of the efforts is: how do we

eliminate manual processes over the

architect our technology, and also

next five years,” Mooney says.

architect our organization to be able to

“I envision that we will have developed

deal with that complexity? Which

very robust data and analytics capabili-

again, I think, will enable us to adapt

ties, and embedded consumer-cen-

and respond when we need to, as

tered design across the organization.”

opposed to just getting totally overwhelmed by that complexity.”

In terms of the future, the CEO of Alliant has clear ideas for how the company can continue to remain on the right side of marketplace trends w w w.busi ne ssc hief. com

206

Mobile assets: Vantage Drilling’s mature supply chain WRITTEN BY

JOHN O’HANLON PRODUCED BY

DENITRA PRICE

M AY 2 0 1 9

207

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VA N TA G E D R I L L I N G

Maturing Vantage Drilling’s supply chain function over the last six years, with full buy-in from senior management, has seen the department morph from support to partner, says Director of Supply Chain Andy Poosuthasee

B 208

ased in Houston, Texas, Vantage Drilling is one of the most effective players in that specialized niche of the oil & gas busi-

ness: offshore drilling. Offshore operations are generally not as easy as onshore or littoral operations – major, national and independent oil and natural gas companies require a dependable partner to carry this out. Vantage has five ultra-premium jackup rigs capable of operating in up to 375ft of water and drilling to depths of 30,000ft. It also has three ultra-deep-water dynamically positioned drillships designed to operate in water depths down to 12,000ft and drill to 40,000ft.

It’s no secret that the entire oil & gas sector is on a slow climb back from its boom days. According to the industry analyst Rystad, offshore drilling in particular may not fully recover till 2027. This has affected drilling contractors like Vantage in a number of ways, says its Director of Supply Chain Andy Poosuthasee. The most notable of these is M AY 2 0 1 9

209

Photos Š Greg Williams

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VA N TA G E D R I L L I N G

“ We won’t sacrifice quality or compliance in order to get something quicker” 210

— Andy Poosuthasee, Director of Supply Chain

that where the norm used to be longer term, multi-year contracts, these days contract terms are often counted in months. This in turn means that the company’s assets have to be moved much more frequently than before.

From a supply chain point of view frequent movements call for a greater degree of maturity, says Poosuthasee.

“Probably the major challenge we face currently is that our rigs don’t tend to spend a lot of time in one particular country – we’re jumping around to different locations,” he explains. With seven of its eight rigs under contract Vantage is doing a lot better than its peers – the industry average is around 61% utilization, and there’s no lack of rigs waiting to come out of shipyards to further dilute that percentage. Still, the brevity of contract duration that is the price for high utilization is a supply chain challenge. “Even if we are working in the same country, the agreements these operators have with us and with the country itself are different. Looking ahead, I think we will be seeing more rather than fewer movements and that means that we have to be very nimble from a supply chain perspective.”

M AY 2 0 1 9

CLICK TO WATCH : ‘VANTAGE DRILLING SHORT FILM 10 DAILY SAFETY TOOLS’ 211

KEEPING IT CLEAN

West Africa, customs procedures are

A fact of life for Vantage is that much of

more complicated, fickle and constant-

its business is conducted in countries

ly changing. In addition, countries that

that occupy the bottom 30 percentile

are highly dependent on oil are even

of the Corruption Perceptions Index.

more so severely affected in the

“This brings in a whole new level of

downturn, which has a knock-on effect

compliance and complexity into the

of potential added corruption. That has

supply chain organization where we

affected our supply chain strategy

must absolutely comply with transpar-

tremendously. We will obviously

ency and anti-bribery legislation such

comply with the anti-corruption laws

as FCPA (US). If you are working in

and have no tolerance for any devia-

places like the Gulf of Mexico or

tion. Recognizing that import clearance

Canada it is simple enough to organize

times may be measured in months

a compliant and predictable supply

rather than days, a rethink of strategic

chain, but in other locations such as in

sourcing and inventory management w w w.busi ne ssc hief. com

VA N TA G E D R I L L I N G

212

strategies is called for,â&#x20AC;? he adds.

Poosuthasee is not daunted by such

forced offshore drilling contractors to find ways to be more effective, espe-

difficulties though. As a certified lean

cially within their supply chain. Conse-

sensei from his earlier experience with

quently, supply chain has become

the oil & gas services company

more important than it used to be in the

Halliburton, he looks on both the

past. I believe most companies

general downturn, and the rise in

(especially large ones) donâ&#x20AC;&#x2122;t take the

corruption that in part comes out of

total cost of ownership into account

that, as opportunities for refining best

because it is difficult to calculate

practices. â&#x20AC;&#x153;In the good times, compa-

especially when they may be working

nies tend to stagnate and the focus

in silos. For example, strategic

was more topline driven for offshore

procurement may be negotiating

drillers. I actually think the downturn

global/regional fixed price agreements,

has been a good thing because it

but not considering the import duties

M AY 2 0 1 9

(which in some countries can be up to

We have seen tremendous benefits

30% of the purchase value), customs

from that exercise.” These benefits

clearance times, freight, and inventory

include a significant reduction in lead

impact because that’s managed by

times, eliminating exposure to import

other departments within supply chain.”

duties (which can be as much as 30%) and customs fines, and enabling leaner

PARTNERING WITH OPERATIONS

inventories. In just three years, he adds,

When moving into a new country, the

Vantage’s local content in all categories

first task is for the procurement and

went from 33.2% to 56.7%, while in the

logistics team to go in, find local

same period lead times were cut by

suppliers and set up a local supply

nearly 40%. Another benefit of local

chain. “In challenging countries, where

sourcing is that it grows the local

it is very difficult to import, our strategy

economy, coupled with the fact that

is to source as much as possible locally.

many countries require foreign 213

E XE CU T I VE PRO FI LE

Andy Poosuthasee Andy Poosuthasee is Director of Supply Chain at Vantage, as well as looking after Engineering, Maintenance and Technical Support. Reporting to the COO, Poosuthasee is responsible for a key part of the company’s strategy. He joined Vantage in 2013, having previously worked at Transocean where he was also a supply chain manager. Prior to this, Poosuthasee was at Halliburton, one of the world’s largest suppliers of products and services for the energy sector.

w w w.busi ne ssc hief. com

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215

operators to maximize local sourcing.

Any supply chain organization adds

importation delays or potential ‘penalties’ and ‘fines’. Countries that

value to operations through quality

are heavily dependent on oil and gas

delivery and pricing – in that order of

especially are constantly changing

importance, Poosuthasee believes.

their import/export requirements.

“We won’t sacrifice quality or compli-

Therefore, the potential for significant

ance in order to get something quicker

fines or penalties by local customs is

and we won’t sacrifice meeting our

there if you are not diligent and

internal customer’s operations delivery

focused on trade compliance. Of

requirements just because it’s going to

course among local suppliers, there is

save us some money,” he says. “One of

also a level of corruption so you must

the biggest benefits we see is that

spend a lot of time auditing them and

when you source locally you don’t have

doing due diligence to ensure compli-

to deal with trade compliance issues,

ance with the FCPA.” w w w.busi ne ssc hief. com

VA N TA G E D R I L L I N G

Vantage now has a mature process for moving into a new market. Its Rig Move Checklist covers 30 logistics actions and 29 supply chain and procurement actions that are done before the rig moves to its new location.

“We are very confident with the process because we have successfully used it so many times before,” he asserts. “I think taking the time to complete these 59 actions in advance is one reason we’ve had such success as we go into new countries. Of course, close liaison with the operations team 216

is very important: they are our customer so we spend a lot of time communicating with them to ensure we cover all of their needs prior to the rig’s arrival.”

TECH TOOLS FOR THE TIMES The priority for Vantage has been to identify cost effective rather than big ticket solutions to deliver automation, data management and reporting in the areas of procurement and inventory management as well as other parts of the business, such as maintenance and engineering. This is no time for heavy investment in this industry, and Vantage’s supply chain team discovered inexpensive, cloud-based M AY 2 0 1 9

solutions at a fraction of the price of managed software to be the answer.

One implemented cloud-based solution has proven to be a collaborative and work management platform with a relatively straightforward user interface. “It is a tremendous tool that has allowed us to eliminate many of our manual processes. The downturn has meant doing the same job with fewer people but we have not seen a degradation in the service that we provide. That’s because we have been able to automate many of our manual processes through the use of simple and really economical applications.”

As a lean six sigma practitioner, Poosuthasee asserts: “One of the hardest things to do is to eliminate a piece of paper from the process.” Even so, a lot of paper processes have been automated by transferring them to this intuitive cloud based system. It’s clear though that he sets more store by the attitudes and commitment people bring to their task than the methodology. “I’ve learnt a lot from mistakes I have made in the past. One of the biggest ones was chasing too many initiatives, too many strategic goals.

Now I tell my team to focus on what w w w.busi ne ssc hief. com

217

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M AY 2 0 1 9

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219

“ We have to be very nimble from a supply chain perspective” — Andy Poosuthasee, Director of Supply Chain

Franklin Covey calls the wildly important goals; focus on less so that your team can achieve more.”

In furtherance of this principle, which Poosuthasee also characterizes as going “an inch wide but a mile deep”, the supply chain team is focusing this year on trade compliance, both to minimize the risks thrown up by different customs regimes and to further automate procurement systems and processes. w w w.busi ne ssc hief. com

VA N TA G E D R I L L I N G

220

M AY 2 0 1 9

A PARTNER IN THE ENTERPRISE When Poosuthasee joined Vantage in 2013, the company was still in “start-up” mode, and supply chain was doing a good job, but more as a support function. Since joining, he has worked to build the organization in three phases. The first phase was to strengthen the foundations and streamline the processes to be as effective as possible; the second was to start demonstrating and adding value to the company. “I wanted to show that we could actively impact KPIs and other value-added activities such as on-time delivery, quality, local sourcing, negotiations and inventory management. Show the company we can do more than just transactional tasks such as issuing POs.” Phase three was to become a true partner in the business, being asked to support non-traditional supply chain tasks such as sourcing service personnel and labor, real estate, catering, auditing, compliance, and even marketing right from the bidding stage. “It was truly pleasing from my viewpoint to see us moving from being a support team to being asked for advice on things we w w w.busi ne ssc hief. com

221

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“ We have been able to automate many of our manual processes through the use of simple and really economical applications” — Andy Poosuthasee, Director of Supply Chain

weren’t involved with in the past and becoming a true partner in the organization.”

Andy Poosuthasee and his supply chain team are certainly finding ways to add value. Even some relatively mature locations have seen some dramatic results. For example, trade compliance turned out to be a big issue in Indonesia where even airfreight imports were taking a fortnight to clear. By developing local suppliers Vantage went from sourcing 47% to 81% locally. A different challenge faced the company in Qatar following the imposition of sanctions by GCC countries from which most supplies had previously been sourced.

In just a couple of years, local suppliers have been brought on, at first being given short contracts but more recently these have been extended and today, he says, it is one of the easiest locations, with more than 80% locally sourced.

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224

Danone: sustainability transformation in food and beverage WRITTEN BY

LAURA MULLAN

M AY 2 0 1 9

225

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DANONE

Food and beverage heavyweight Danone has earned its stripes as a sustainability champion – But what’s the secret behind its success?

F

rom evian water to Activia yoghurts, Danone’s products are now a mainstay of any household fridge or supermarket

shelf. Under its banner, the food and beverage giant 226

hasn’t just invented iconic flavours, it’s also made a name for itself as a sustainability powerhouse.

In 2017, Danone unveiled a refreshed logo and its very first company signature: ‘One Planet. One Health’. This slogan underlines the French multinational’s belief that the health of people and the planet are inherently interconnected. It also marked a call to action, urging consumers to join the ‘food revolution’ and adopt healthier, more sustainable eating and drinking habits.

It’s an impressive mantra, but Danone’s commitment to health and sustainability stretches back much further. In fact, it’s almost as old as the company itself. In 1919, Danone’s founder, Isaac Carasso, noticed that many Spanish children suffered from intestinal infections. Echoing the previous work by Nobel laureate and Pasteur M AY 2 0 1 9

227

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â&#x201A;Ź24.7bn+ Approximate revenue

1919

Year founded

10,000+

Approximate number of employees 229

Institute director, Ilya Mechnikov, he

ment Goals of the United Nations,

launched a yoghurt which marked the

these objectives include: offering

birth of the Danone brand. Fast forward

superior food experiences and

to today and the Paris-headquartered

innovation; delivering stronger sustain-

firm is present in over 130 markets with

able profitable growth; becoming a

a slew of beloved and trusted products

certified B Corp; impacting peopleâ&#x20AC;&#x2122;s

including essential dairy and plant

health locally; and growing Manifesto

based products, early life nutrition,

brands as well as preserving and

waters and medical nutrition.

renewing the planetâ&#x20AC;&#x2122;s resources.

Keen to stay laser focused on its

On top of this, the firm has also

sustainable vision, Danone has

pledged to foster inclusion and growth,

pinpointed nine ambitious goals that it

serve the food revolution with partners,

hopes to achieve by 2030. Aligning

and entrust its people to create new

with the 2030 Sustainable Develop-

futures. Revealing these ambitious w w w.busi ne ssc hief. com

DANONE

“In 2017, Danone unveiled a refreshed logo and its very first company signature: ‘One Planet.

One Health’”

230

M AY 2 0 1 9

231

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PURPOSE LED, PERFORMANCE DRIVEN

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233

goals, Emmanuel Faber, Chairman and

cant strides towards these objectives.

CEO of Danone, said that he believes

Last year, Danone North America

“each time we eat and drink, we can

became the world’s largest B Corp, a

vote for the world we want”. He added:

key social and environmental milestone

“This has inspired the definition of our

for the firm which shows it has met the

long term goals which flow directly

“highest standards of verified social

from our ‘One Planet. One Health’

and environmental performance,

vision. As we strengthen our business

transparency, and accountability”.

model and nourish our dual economic

In 2017, the firm also reported that 86%

and social project, we have every

of its total packaging (and 77% of its

confidence we will deliver our business

plastic packaging) was reusable,

and financial agenda, as well as create

recyclable or compostable. This is just

and share sustainable value for all.”

the beginning: by 2025, the firm aims to

Danone has already made signifi-

ensure that every piece of packaging, w w w.busi ne ssc hief. com

DANONE

234

from bottle caps to yoghurt cups, is

partnerships to make

recyclable, reusable or compostable.

At the same time, Danone has also

for instance, evian is taking part in

made consistent efforts to reduce its

a research mission with The Ocean

waste and optimise material use, for

Cleanup, a Dutch nonprofit startup that

instance, the firm plans to introduce

has created advanced technologies to

alternatives to plastic straws, launching

help rid the oceans of plastic, whilst

a pilot under its Indonesian brand

elsewhere Danone AQUA has pledged

AQUA. Additionally, itâ&#x20AC;&#x2122;s also trying to

to recover more plastic than it uses in

eliminate non-recyclable shrink film

Indonesia. On top of this, the French

by using specially designed adhesive

business is also a proactive member of

for its evian water brand.

the Sustainable Food Policy Alliance

Danone has also forged meaningful M AY 2 0 1 9

its plastic-free vision a reality:

alongside industry peers such as Mars,

235

Nestlé and Unilever. Aiming to advance

“a balanced, profitable and sustainable

public policies that improve transpar-

growth model”, according to the firm.

ency for consumers, support farm

Through this initiative, Danone aims

communities, and tackle climate change,

to generate cost savings of €1bn by

the alliance is set to be a game changer

2020 by making efficiency an ingrained

for policy action, shaping the wider

part of day-to-day business.

food and beverage industry at large.

This sustainable ethos also extends

In order to include its employees on this sustainability roadmap,

to Danone’s top and bottom lines.

Danone’s workers are also set to

Indeed, the food and beverage firm

receive one Danone share to deepen

has recently launched an efficiency

their ownership mindset. The firm has

programme called Protein that

also developed an internal platform

is designed to help Danone build

with extensive sharing and learning w w w.busi ne ssc hief. com

DANONE

M AY 2 0 1 9

resources to help employees support

that “there is only one earth, we only live

the firm’s vision and goals. But it’s not

once.’’ Those words kick-started a vision

just employees who are an important

that lives on today. Now, sustainability is

catalyst of this sustainability drive.

an intrinsic part of Danone’s DNA, just

Indeed, Faber highlights how consum-

as much as its beloved brands and

ers are an integral part of this transfor-

flavours. With its 2030 goals, the

mation journey and how they’ve pushed

French food and beverage giant has an

the firm to better itself. “Consumers are

ambitious roadmap underway, which is

craving change,” he says. “They expect

about actions as well as words. Now,

large organisations like Danone to

with the help of its employees, con-

bring our scale of impact to change

sumers and partnerships, Danone’s

the world for the better.”

sustainability vision is almost in grasp.

With this in mind, it seems sustainability is set to remain a core tenet of Danone’s strategy in the years to come, just as it has been since the business was founded almost a century ago. Indeed, Antoine Riboud, the first Danone Chairman and CEO, said in 1972 w w w.busi ne ssc hief. com

237

238

Transforming supply chain strategies WRITTEN BY

SEAN GALEA-PACE PRODUCED BY

TOM VENTURO

M AY 2 0 1 9

239

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T C T R A N S C O N T I N E N TA L

John Adams, Senior Vice President & Managing Director of Transcontinental Advanced Coatings, discusses how his business segment is operating in the manufacturing industry amidst significant digital transformation 240

W

ith the world’s leading companies undergoing digital transformations to accelerate operations, it’s becoming

fundamental that businesses employ the latest technological advances to sustain success in the manufacturing industry. John Adams, Senior Vice President & Managing Director of the Advanced Coatings business segment within flexible packaging company TC Transcontinental, discusses his procurement strategy and how his team leverages technology to disrupt and lead the manufacturing sector. “Procurement has been critical to identifying partners that can enable us to achieve our productivity and innovation aspirations,” explains Adams.

“We’re always looking at how we can enhance productivity and expand our capacity to enable growth. You can’t have a strong growth strategy without a smart investment strategy.”

M AY 2 0 1 9

241

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T C T R A N S C O N T I N E N TA L

“ Procurement has been critical to identifying partners that can enable us to achieve our productivity and innovation aspirations” 242

— John Adams, Senior Vice President & Managing Director Transcontinental Advanced Coatings

M AY 2 0 1 9

With technology considered a key component of Transcontinental Advanced Coatings’ procurement strategy, Adams believes it’s important that his business segment utilize technology in the right way – especially when it comes to safety. “When we think about how we use technology, we think about what the strategic priorities of the business are and decide where we need to invest.

Safety is always our top priority,” he says. “Since we use a range of solvent based techniques in our manufacturing processes, it is imperative that we ensure our work environments are safe from any risk of fire at all times.

CLICK TO WATCH : ‘TC TRANSCONTINENTAL – 2019’ 243 As a result, we invest in a range of

the business operates a converting

technologies for the detection

and distribution facility in China,

of different solvents, monitoring of

serving its customers on a global scale.

humidity control, dissipation of static

Having been with the company since

throughout the production line, and the

March 2016, Adams is proud of the

safeguarding of equipment to make

considerable growth achieved in the

sure that we have a safe environment.”

past three years. “When I joined, it was clear to me there was the potential for

OPERATING IN THE MANUFACTURING SECTOR

large expansion of the business,

Transcontinental Advanced Coatings

market segments we serve,” says

operates ISO-certified manufacturing

Adams. “Approximately half of our

facilities at its headquarters in

business globally is tied to the medical

Matthews, North Carolina, and it’s UK

segment, inclusive of advanced wound

plant in Wrexham, North Wales. Also,

care products. With favorable global

primarily due to the nature of the key

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T C T R A N S C O N T I N E N TA L

244 growth trends in healthcare, inclusive

ion batteries on an explosive growth

of a growing aging population and

trajectory, we’ve started to think about

increased access to medical care,

things such as consumer electronics,

that segment represents an expanding

cell phones, and the automobile space.

market worldwide — it’s a great area

I think it’s important to consider the

to be a market leader in.”

key drivers of segment growth and the

To set TC Transcontinental apart

underlying fundamentals of the

from rivals, Adams understands the

business. What do people want? For

requirements of his customers to

example, they want a phone to charge

ensure the business can continue to

faster and for the charge to last longer.

transform in an ever-changing market.

We work with customers to create

“We’re able to work intimately with our

energy storage solutions for such

customers to develop and commer-

products. We can apply very thin

cialize differentiated solutions, rather

coatings to substrates that become

than just being a commodity product

the building blocks for power transmis-

supplier,” says Adams. “With lithium-

sion and storage devices.”

M AY 2 0 1 9

E XE CU T I VE PRO FI LE

John Adams, Senior Vice President & Managing Director John Adams joined Coveris Americas in 2016 as the Vice-President of Sales and Marketing for the global Advanced Coatings business and was promoted to the Vice-President and Managing Director role for the organization later that year. Following the acquisition of Coveris Americas by TC Transcontinental in 2018, John was named Senior Vice-President and Managing Director of the Advanced Coatings business segment.Before joining TC Transcontinental, John spent over five years with Danaher Corporation as a Vice-President of Sales and Marketing for a global industrial controls business group comprised of 6 business units covering the Americas, Europe, and Asia. Also, he spent over 15 years at Teradyne, Inc., holding roles of increasing responsibility in engineering, marketing, and general management. He holds a B.S. in Mechanical Engineering from Worcester Polytechnic Institute, and an M.S. in Manufacturing Engineering and an MBA from Boston University.

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245

T C T R A N S C O N T I N E N TA L

ESTABLISHING KEY PARTNERSHIPS In May 2018, TC Transcontinental completed the acquisition of Coveris Americas, inclusive of the Advanced Coatings business segment. Recognized as one of the top 10 converters of flexible packaging and other value-added products in North America, Coveris Americas manufactured a range of flexible plastic and paper products such as bags and pouches, shrink films, coextruded films and coated substrates and labels.

“TC Transcontinental had been 246

focused on diversifying its printing and media assets to ensure its long-term growth and initiated its strategic shift in 2014 with a first acquisition in the flexible packaging industry,” explains Adams. “That leveraged manufacturing as their core competency and they invested in approximately six smaller acquisitions, generating about CAD $300mn in annual revenues.

When Coveris Americas became available; it was a great opportunity for TC Transcontinental to continue the transformation of the company. Now, packaging is the largest sector of TC Transcontinental, and it’s become the engine of the company’s strategic M AY 2 0 1 9

247

$2.6bn Approximate revenue (CAD)

1976

Year founded

9,000

Approximate number of employees

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“ When we think about how we use technology, we think about what the strategic priorities of the business are” — John Adams, Senior Vice President & Managing Director Transcontinental Advanced Coatings

to aid with solvent vapor monitoring.

“EW Process has been able to monitor the full range of solvent products that we use to ensure we don’t have any issues,” says Adams. “In our operations, safety is always our number one priority. Control Instruments is the one supplier we can depend on to provide comprehensive LEL sensing solutions that ensure the full range of solvent vapors resulting from production are precisely monitored through the equipment. This capability is paramount to ensuring we have no risk of combustion prior to exhaust entering our

shift. The Coveris Americas acquisi-

thermal oxidizer for final destruction.”

tion has allowed the company to become a leader in the North Ameri-

REMAINING SUSTAINABLE

can flexible packaging market, and

With sustainability crucial to the long

provides a strong, stable environment

term growth of all businesses, TC

for us to continue our growth.”

Transcontinental has several targets in

Transcontinental Advanced

mind in a bid to continue to thrive in the

Coatings business is in a rapid growth

manufacturing industry. “It’s about

phase, and as a result is focused on

having a strategy rooted in strategic

optimizing the performance of existing

markets, and ensuring that the

operations, and making the strategic

segments we’re in have fundamentally

investments necessary to enable

sustainable long-term growth trends.

growth. As an example, with safety as

As an ISO certified company, we

a top priority, TC Transcontinental has

ensure we have a high degree of

established a critical partnership with

process control, and explicitly

EW Process and Control Instruments

prioritize where we will grow and w w w.busi ne ssc hief. com

249

T C T R A N S C O N T I N E N TA L

invest, and where we will not.”

To achieve a sustainable future, TC Transcontinental values the importance of building and developing a capable team to deliver a market-leading level of customer intimacy and responsiveness, staying ahead of rivals technologically, and achieving mutual and collaborative success with our customers. “It’s important that we recruit strong people and put a lot of energy into building, investing and helping our associates to stay ahead of the curve, in terms of training and capabilities,” explains 250

Adams. “We’re constantly bringing in new hires from universities to provide us with new ways of thinking. Thanks to this talent, combined with the best new technologies, we are innovating and developing next-generation environmentally sustainable solutions. TC Transcontinental’s unwavering commitment towards sustainability means that we are always looking at limiting our environment footprint and reducing waste.”

New technologies are critical to staying ahead of the curve in terms of quality and delivery performance.

“Two key capital investment strategies involve the implementation of in-line M AY 2 0 1 9

vision systems, ensuring 100% visual inspection of our products throughout the production process, and deployment of IoT 4.0 technologies, providing us with advanced notice of impending capital maintenance needs to minimize unplanned downtime and optimize maintenance spending,” notes Adams.

Looking to the future, Adams believes there is significant room for Transcontinental Advanced Coatings to grow over the next few years.

“We see the opportunities for substantial organic growth, and we intend to add additional capacity to our coating facilities in the near and mid-term as we optimize utilization of our existing capacity,” summarizes Adams. “Many of the partnerships that we have are long-lasting, and we continue to build off that as well as part of our growth strategy to help support our partners in the next generation of developments.”

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251

252

TE Connectivity: Transforming manufacturing WRITTEN BY

JOHN Oâ&#x20AC;&#x2122;HANLON PRODUCED BY

TOM VENTURO

M AY 2 0 1 9

253

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TE CONNECTIVITY

The automation of manufacturing processes is driving the rapid development of the products of tomorrow: Roberto Lu, Vice President – Technology: Automation Manufacturing, Global Operations, explains how…

B

ack in 1941, Aircraft Marine Products (AMP) was founded, as so many companies were, as part of the technical leap

forward catalyzed by war. The need for rapid 254

development and deployment of new ships and aircraft spelt the death of labor intensive manufacturing practices such as manual soldering of electrical connections, and AMP – which would later become TE Connectivity – established itself on its ability to develop solderless connectors that could be changed quickly but without losing the ability to pass current reliably in demanding conditions.

78 years on, this market has transformed very much to TE Connectivity’s advantage. The company is still adding value at the interface between devices and solving the problems presented at those interfaces. Electronics are ubiquitous.

Domestic appliances, automotive, aerospace, energy, manufacturing, medical devices and more all call for specialized and smart connectors to enable transformations through the internet of M AY 2 0 1 9

255

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TE CONNECTIVITY

“ Our production today is all about automation and semi-automation” — Roberto Lu, VP Technology, TE Connectivity

things (IoT), machine learning (ML), automation and robotics.

This places TE Connectivity firmly among the essential global companies that most people haven’t heard of, sitting behind the label on your smartphone, your transportation, all of your internet activity and every experience you have. It develops and manufactures switches, cable assemblies, relays, antennae and many more product categories as well as critical connection solutions for fiber optics.

Today the company employs 80,000 people, makes 220bn products a year,

256

achieved sales of $14bn in 2018 and has 130 manufacturing and engineering centers around the world.

AMP was acquired by Tyco International in 1999, becoming part of Tyco Electronics in a 2007 restructure.

In 2011, however, it rebranded itself as TE Connectivity partly to reflect its approach to the market and partly to avoid confusion with other Tyco companies. This happened under the leadership of Tom Lynch, CEO from 2006 until 2017 and now Chair of the Board. Attracting talent was an important part of the former Motorola CFO’s strategy, as was shown in 2011 M AY 2 0 1 9

CLICK TO WATCH : ‘ENGINEERING THE FUTURE’ 257 when he reached out to a high-flying

about the company at the time. I was

Boeing executive to fill the newly

attracted by the breadth of TE’s global

created job of Vice President –

reach and the realization that it is

Technology: Automation Manufactur-

present wherever there is a signal –

ing, Global Operations.

whenever you call someone you are going through TE products!”

CAPTIVATED BY CONNECTIVITY

Having no predecessors, at first Lu

What persuaded Roberto Lu to take on

worked on his own and without a budg-

this challenge? “Tom had brought in

et. “I travelled extensively in the first

Rob Shaddock as CTO from Motorola:

weeks and I was amazed at the number

they saw they needed someone to run

of opportunities that I saw to contrib-

manufacturing technology so they

ute on the manufacturing technology

created my job. I hadn’t planned to

side,” he explains. As a part of the

leave Boeing, but I was really captivat-

global corporate headquarters

ed by TE, though I didn’t know much

organization, reporting to the CEO w w w.busi ne ssc hief. com

TE CONNECTIVITY

258 through the head of operations, Lu’s responsibility covers all the TE

acronym stands for automation!”

This nimble approach typifies the

segments: Communications, Trans-

company and its leadership, he

portation and Industrial. Today he has

continues. “Back in 2012 it was quite

a team of 50 engineers located in the

visionary of the company to see that

USA, Mexico, Europe and China but

automation was going to be such a big

his organization had to be built from

deal. We have to give this credit to our

scratch. “In March 2012 I inherited a

leaders because who can estimate

small team and was allocated a budget

what is going to happen a few years

– my boss asked me what I wanted to

down the road? That is another reason

call it, so I said AMT. At the time that

that I really like this company: the

stood for advanced manufacturing

leaders are not only interested in this

technology but we rethought that,

quarter’s performance on the stock

taking into account the rapid growth of

exchange market but also looking

automation, and now the A in the

forward years down the road to see

M AY 2 0 1 9

where we’ll be in the long term.”

You can buy TE products across the

stage to solve connectivity issues before the product is made. Team

counter or even online through

members from TE Connectivity work

distributors or the company’s website.

full time at the engineering and

However, most of TE’s business

production facilities of nearly all

comes from engagement with OEMs

of the world’s global auto and aircraft

with whom the company works closely

makers. There’s also a high percent-

to develop solutions for next-genera-

age of TE content within the critical

tion products, right from the concept

control functions that maintain the

E XE CU T I VE PRO FI LE

Roberto Lu, Vice President – Technology: Automation Manufacturing, Global Operations TE Connectivity (NYSE: TEL) is a $14bn global industrial technology leader. TE connectivity and sensor solutions are essential in today’s increasingly connected world.

TE collaborates with engineers to transform their concepts into creations – redefining what’s possible using intelligent, efficient and high performing TE products and solutions proven in harsh environments. He works closely with the company’s manufacturing and operation leaders to advance TE’s overall manufacturing capabilities in automation, artificial intelligence and machine learning technologies.

He charters TE’s global manufacturing technology strategies and roadmaps, which guide the company’s manufacturing technologies, initiatives, and the overall development of new manufacturing processes. Manufacturing technologies from his team reach more than 102 TE factories in EMEA, the Americas and Asia.

w w w.busi ne ssc hief. com

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TE CONNECTIVITY

$14bn Approximate revenue

2004

Year founded

80,000

Approximate number of employees 260

M AY 2 0 1 9

261

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“ We have 8,000 engineers working on connectivity solutions” — Roberto Lu, VP Technology, TE Connectivity

speed and stability of the 350+ kph Beijing to Shanghai high speed train link, Lu says. It’s worth noting that TE Connectivity is among the biggest foreign employers in China, where it has more than 2,000 engineers working on product research and manufacturing development.

The competitive advantage of vertical integration can’t be overstressed.

A major transportation organization, for example, wanted connectivity solutions to deliver fast streaming of media content. Weight reduction and efficient operation were key criteria.

“They came to me with the next question: what about manufacturing technology and were we going to manufacture in a low cost location with a lot of manual labor? I could assure them that we have 11 patents on this product family manufacturing technology. We own it. Our production today is all about flexible precision automation and semi-automation. Our customer can rest assured that TE can not only produce the parts to the satisfaction of the customer but that we have our manufacturing technology in-house and they have access to our technical team members including myself!” w w w.busi ne ssc hief. com

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TE CONNECTIVITY

INNOVATE AND AUTOMATE As the leader of a global center of excellence in assembly automation, including manufacture and assembly, innovation is important to Lu. “We must lead with the next ready-to-deploy technology otherwise the innovation pipeline runs dry, and that is bad business. The opportunities presented

by IoT are taking us in many directions.

At our engineering centers we have top grade engineers developing innovations that will be needed in transportation, for example, as driverless cars 264

and even ships and aircraft become a reality. We have 8,000+ engineers working on those connectivity and sensing solutions. Out in the field their concern is to build customized solutions for major connectivity platforms, and work on the production floor to implement these solutions.” As we have seen, the IP the company possesses aids the customization of solutions – once a successful implementation has been established at one site, it will be rolled out at multiple sites, saving time and money.

On the manufacturing side, his team is constantly working on improving performance and finding new soluM AY 2 0 1 9

tions: one of the biggest challenges (and market opportunities) is presented by high-speed communications. In this field alone, he says, TE holds more than 200 global patents. Here automation has been the key. “In many product categories we are achieving over 99% first-time-right pass rates. There’s no way that can be achieved through manual processes, and our customers really appreciate that reliability. We have developed spatial intelligence machine learning capability for a variety of our products, with at least 18 deployments across sites of various business units. We use artificial intelligence to learn what is done right and what is not: there’s deep learning behind our processes and our inspections to increase our speed and quality.”

In 2011, Roberto started to draw up technology roadmaps to chart forward development, and today he and his team continue to use this approach.

A year later, with the support of Rob Shaddock and Tom Lynch, he introduced TE Connectivity to the global RoboCup competition. With so much talent residing in its engineers, dispersed as they are, it was necessary to find collaborative routes to w w w.busi ne ssc hief. com

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TE CONNECTIVITY

266

innovation. “Innovation is a team sport,

NEVER-SATISFIED CURIOSITY

and it’s everybody’s job,” said Rob

One of Lu’s great strengths is his

Shaddock, former CTO and Lu’s boss

desire to learn. Since bagging his first

at the time. Teams participating in

degree in 1985 at Taiwan he gained

RoboCup use vision-guided robots to

four more advanced degrees from

improve TE production processes and

American universities including a

provide significant ROI. Lu’s AMT team

doctorate in industrial engineering.

runs robotics courses for the partici-

There’s continuity from his work at the

pating team members, training them in

Boeing Company, where he worked for

working with new applications such as

over 13 years, and his present role in

collaborative robotics. The first

that they both involved manufacturing

competition took place in 2012 and it

technology research and development

has run annually ever since.

– though the transition was not an

M AY 2 0 1 9

obvious one. “I was honored to work alongside so many innovators at Boeing and was one of the first few engineers working on the Boeing 787 in 1999. We had to develop our internal processes because on something like that there’s nobody you can ask!”

Involvement with something as high profile as the 787 Dreamliner, and the experience of working at Boeing, where they say ‘The sky is not the limit – it is Boeing’s playground’ was “awesome”, according to Lu. “In my Boeing days I was very fortunate to have outstanding leaders and managers who inspired me.” The company became his own playground, he

“ Insatiable curiosity became a drive for me to seize every opportunity to contribute to Boeing locations globally” — Roberto Lu, VP Technology, TE Connectivity

admits. Poring over the internal maps of Boeing’s many locations he set himself the task of getting into every building on every manufacturing and fabrication site and finding out what happens there. A tall order, but he managed to do them all bar one.

“Insatiable curiosity you may say, but that curiosity became a drive for me to seize every opportunity to contribute to Boeing locations globally.”

He had every expectation of retiring as a senior Boeing Fellow when he was approached by Tom Lynch, who w w w.busi ne ssc hief. com

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268

he regards as the model of an inspirational leader. Perhaps he recognizes a

capabilities than we know.”

In 2015 at a global leadership event

kindred drive and curiosity in a

for the top echelon of the company Lu

corporate finance leader prepared to

was listening to a dinner presentation

leave his dream job as CFO at

when he heard a story unfolding that

Motorola to turn around the reputation

was rather like his own. “I realized that

of Tyco electronics. “It’s Tom who

this was actually my story: then my

has made TE Connectivity the really

name was announced and I had to

strong performance company it is

quickly gulp down my food and go up

today. He likes to inspire everyone,

on the stage to be presented with a

with the message that we have better

black leather jacket! The jacket is like

M AY 2 0 1 9

269

a pilot’s jacket – it means you are a

made more mistakes than I would like

solo flyer, and it is a great honor, rather

to admit to! The key thing was that

like a lifetime achievement.”

I recognized them and accepted they

Despite this and many more achieve-

were part of my growth.”

ments, like the publication of his book on ASCL models in production engineering, Lu is refreshingly ready to admit he doesn’t know it all. Don’t be afraid to make mistakes as long as you learn from them, he says. “I am thankful to TE Connectivity because I have w w w.busi ne ssc hief. com

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