Episode #52: The Real Potential of Digital Transformation, with Paul Herman

Every company is a digital company. Thanks to the high bar set by world’s best digital companies, your customers come to you with a backpack full of high expectations. In order to be successful you need to meet those expectations. Today, Paul Herman (VP of Product Marketing at Sprinklr) and I explore the challenges and opportunities of true digital transformation, and what it means for your business.

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PODCAST TRANSCRIPT

Grad 
Okay, welcome to a special episode of the CXM Experience. And as always, I am your host, Grad Conn CXO, chief experience officer at Sprinklr. And today I am joined by Paul Herman, the Vice President of Product Marketing at Sprinklr. And Paul is a long time colleague and peer of mine. Paul and I are both early, early customers of Sprinklr. I fondly recall days of jumping on the train and going down to Portland and seeing what they were doing at Nike. So I quote Paul all the time, and Paul is one of my favorite people. So I’m really excited. Paul is one of my first internal Sprinklr guests. So really glad to have him on. And, Paul, you’re the third show of 2021, the year that everyone was looking forward to, and everyone’s already regretting. It must be hard to be 2021. You know, expectations were so high. They were so high. Probably unrealistically high. But how are you doing? And how was your break?

Paul Herman 
Break was lovely. Thank you so much for having me on the program. It’s exciting to be here. And to talk about this topic. The break was good. You know, I went down to the Oregon coast to experience some horizontal rain. And so that was a fun time. But yes, so 2021 started off much like 2020 ended. But hopes for what’s going on and what’s gonna happen in the future.

Grad 
Well, there’s always 2022, right? I mean, at some point. Anyway, I wanted to talk today about something that comes up all the time. In fact, I was just on a call this morning with one of our customers. A very, very large global packaged goods company. I think I must use every single one of their products. Some of the products I’ve used, but I’m not in the use zone on them right now, but certainly been an amazing experience with them. And they’re right in the midst of digital transformation. It was a really interesting conversation. I actually was quoting you liberally, and crediting you, by the way, Paul, so just so you know. I was quoting and crediting you.

But they’re at a stage where I feel like maybe you and I were a couple years ago, or maybe even four or five years ago. I think it was maybe easier for the tech firms. And Nike, I know Nike’s, an apparel company, but also feels like a tech company in some ways. And I’ll let you talk about that.

But a lot of the companies are really just starting to get on board the digital transformation. And I think DT for me is a really fascinating topic, because I remember 2010, when I was at Microsoft, what digital transformation meant, was really switching from analog to digital. And this almost seems ridiculous now in retrospect, but like the big thing in 2010, at Microsoft is that we weren’t going to use paper anymore. They took away the copiers. Steve Ballmer sort of famously went to OneNote on everything. And we were now digital. It was really just paper in digital form. But it was, you know, it took a long time to really get to true digital. But that was a necessary first step. But you know, a lot of companies aren’t there yet.

Then there’s this sort of second wave of disruption, which is, how do you start thinking about things in real time? And how do you look at things on an ongoing basis. And that’s very different from the motions that have been set up at most companies which are quarterly motions. And I think the third way that’s coming along now is that when you can look at things in real time, you can also talk to your customers in real time. And you can look at what your customers are doing in real time. And that’s a whole other sort of mindset shift around customer first transformation.

And so I want to jam on this topic with you a bit. You’re out there a lot, you see a lot of this going on. I’d love to get what your impressions are from different groups and different companies. And then underpinning all of this and underpinning what I think is making DT realistic now is that AI is getting sophisticated enough that the machines are able to actually get in there and do the work that required human intervention before. So that’s our topic for today. We’ll do this for 10 minutes or so, you know, just kind of go back and forth. Love to hear your thoughts and let me know where you want to start on this one.

Paul Herman 
Yeah, I think it’s really, really fascinating to see. I would say you’re right on. I think the last three to five years, has seen a tremendous amount of acceleration, especially 2020. It was the classic proverbial iceberg and the water situation where many companies realized and were exposed in their need for digital technologies as much of the analog and live world sort of stopped. And so, I’ve seen it as well, going back to the Nike story, you know, that started at around the same timeframe 2010, 2012, where the CMO of Nike at the time famously stood up and put one slide up and said, digital is oxygen.

Grad 
I remember.

Paul Herman 
Yeah, yeah. And for a company that’s based on performance and motivation to get people to move, oxygen had a very… that word was chosen very carefully. The oxygen for an athlete is not just getting me to breathe and getting me to move. Oxygen is the thing that you measure. Your VO2 max is the is the thing you measure for performance. And so in essence, he was not just saying digital is life, but he was saying digital is performance. Right? And people groked that. They’re like, okay, yeah, that’s interesting.

The other thing that was a big shift that I’m seeing and a lot of people are not doing and companies coming around is the shift to personal, premium, seamless service, right? Not necessarily marketing first. Yes, marketing is a big part of that. But marketing out of the position of service, and that has absolutely been amplified recently. A lot of companies are realizing we have to be personal, right, and personalization — to your point around AI — personalization requires us as brands to become more contextual. I tell a lot of companies, hey, content is king. But context is Queen and the Queen always rules. Right? And this new world of digital data has provided an unprecedented amount of context. And brands that are contextually dumb are the brands that are losing. And so brands are looking to AI to help sort out this massive amount of meta information into actionable insights. A different way of using the word AI in my mind would be, you know, instead of saying artificial intelligence it’s more these actionable insights are super important, right? And that allows you to become more personal, right? Premium is then, okay, I’ve got to break through the clutter. And there are way more people online than ever before. I think the stat the other day, there’s about 5 billion smartphones in 2021. Right? So you’ve got to break through that clutter. Right? So that’s the premium piece. I’m competing with Jerry of the day or some skier wiping out or my best friend’s cat, right? So I’ve got to break through this, I’ve got to become relevant and premium. That’s why AI can also help. AI is going to help me then to understand. Maybe AI in that instance is asset identification, like what assets are working, when are they working? Right? So that’s interesting.

Grad 
Then we go to this concept of seamless. Oh my. How many times have you and I heard the word customer 360? Right? Treat me the same on any channel that I’m in engaging with you, or more importantly, treat me on the channels that I want to engage with you on. Right.? So that becomes really interesting. And then in the world of AI, I would say, that specific area is more like, how do I do AI that would be an automated inference? How do I infer what the customer and what the consumer wants to talk to me about? How am I able to assist the interchange of information? And then finally, service? Right? Service is an interesting word for a marketing person. But if you really are in the motion of learn to serve, to know to grow, having a service mentality allows you to really think around a value exchange, right? Like the consumers are off to authentic value. And service is a wonderful starting point to think, Okay, how can my marketing serve you so that you give me information back and we grow together? That’s a whole new interesting world that we started to see. So it’s a long answer. But that’s what I’m seeing. And you know, if I could summarize the Nike journey from 2012, to where we are today.

That’s pretty cool. Well, you know, this context and content sharing that you’ve done, the first time you landed that on me a few months ago, I loved it, because that I think it’s like… everyone says content content content., But content without context is not helpful. And I’ve got a quick example of something’s just happened to me in the last 24 to 48 hours that I thought was interesting. And it just points out how far we still have to go. So I went to go see a knee doctor. I’ve had some problems with my left knee and they did an MRI on Tuesday. And the MRI results came back. And my doctor called me immediately and she said, I need you to get on Zoom right this second. And I’m like, that’s always a good sign, right?

Paul Herman 
A knee-jerk reaction.

Grad 
And I will say, you know, a wonderful thing about the digitization of healthcare is that the old days would be like, you get a call, come on in the office. I mean, the results came in, they went into my portal, I’m a New York Presbyterian customer. So they went into the Epic MyPortal, I was able to connect with my physician literally within… I was walking the dog, right. So I said, Let me get back in the apartment, and 10 minutes later, I’m on a Zoom call with her. And she’s showing me the MRI. Wow, it’s pretty amazing.

Anyway, so I have a very large medial tear in my left interior meniscus. With a flap that’s digging the crap out of my cartilage and pressing my MCL out. And she’s like, you have to get this fixed right away. When I first saw her, she’s like, you’re such a crybaby, and just do some PT, you’ll be fine. And then she’s like, Oh, my God, this is a terrible injury. And you need to get this repaired immediately. And I don’t understand how you’re even walking right now. And so it was great. Right?

Grad 
So I took the took the diagnosis. And I just did a quick copy and then I pasted it into my Safari browser and did a search and some results came back. And one of the results is from the Hospital for Special Surgery. Very, very famous orthopedic hospital here in New York City. So that was kind of cool, because it localized my results to hospitals near me, which was neat. And it also presented one of the world’s top orthopedic surgeon hospitals right at the beginning my results. And I hit their page. And it’s kind of complicated, and I moved on. Next thing you know, you know what I’m about to say, right? I log into Facebook. And there’s an ad for guess what? Yeah. Mm hmm. The Hospital for Special Surgery. And the good news about the ad, what I thought was kind of cool is that it actually was an ad for the joint practice at HSS.

Paul Herman
So super refined. Yeah.

Grad 
Pretty refined. Yeah. But this is the whole issue. And this is where I’m gonna want to talk about digital transformation, changing expectations, right? So I’m like, okay, that’s cool. So I click on it. And I just land on their webpage again.

Paul Herman 
Oh, no.

Grad 
And it’s like find a doctor. And they’ve got a lot of doctors. Not millions. But there’s like a lot of doctors and, and basically, you’ve got to review each doctor’s profile or something. And so I’m kind of reading them. And I found one who specializes in meniscus repairs, I have an appointment with her. So I’m moving down the road on that and all that kind of stuff. But I was thinking to myself that this could be such a better experience. Imagine if I do that search? And I remember the search term was the actual injury I have, right? Wouldn’t it be cool if it was like, this person does 10 of these repairs a day at HSS. And she could see you next Wednesday at nine o’clock if you want to have an appointment? Like, why can’t they get to that stage yet? And I thought to myself, in a way, I felt a little bit guilty. Because healthcare is so ridiculous, like, and I’ll give you another story in a second. It’s amazing that they’re doing this at all. And the irony is I’ve made this appointment. And what I have to do is I have to fax the MRI results…

Paul Herman 
What’s a FAX?

Grad 
… before my appointment? So it’s almost like I’m going back in time as I proceed more deeply into the process. But what I realized is that my expectations have been formed not by the standard in healthcare. But as I’m doing this, and as I’m thinking damn, this isn’t really what I.. someone has done that correctly. Not in healthcare, some other… maybe when I was buying like, I don’t know, bananas or something, right? Someone has done that well. And now judging this other category in a very different way. So let’s talk about that for a second. Which is, yeah, a lot of companies measure themselves against their direct competitors, but it’s actually a lot more broad than that in digital transformation. I think you’re being measured against the very best companies in the world.

Paul Herman 
I couldn’t agree with you more. Ya know, I use the phrase, consider the modern consumer is coming with a backpack full of expectations, and probably none of them you put in the backpack?

Grad 
Yeah.

Paul Herman 
So the way the consumer is looking for search is influenced by Google. The way the consumer is expecting share is coming from social networks, the way the consumer is expecting up to the minute feedback may be coming from back in the day when they used to get an Uber, or today when they’re ordering a pizza. Right? And the amount of information that I can get at my fingertips, right? There’s so many things that people are just expecting. So that’s what’s happening, right. And the other observation there is that many brands have realized that they can’t approach many of these modern channels, like they’ve approached traditional channels. In the sense of, many modern channels, if you’re creating one, you’re your birthing people. In an email address, whatever company email address generally, is not a person. It’s often doesn’t even have the person’s name. It says, support at fill in the blank dot com, right? Like, it’s very un-human. Versus when I’m on a social network or my chat. I’ve started a human conversation. So think about if you were in a bar and you met someone, and halfway through the conversation, you stopped and started writing on a napkin and passing the napkin to them. They’ll go What the heck just happened? And brands do. We started Hello, my name is… and then I’m sending you a napkin or you know, please call me at this time and walk out the bar. What just happened? And we don’t think of it like it that way, but that’s how we’re treating consumers.

Grad 
Well, we’re just having a great conversation here with Paul and going a little long, so actually going to cut this thing into two. So this ends part one, and we’ll come back with part two tomorrow for the CXM Experience. Grad Conn, CXO and Sprinklr.