Dialogues In Digital Transcript
Javaid Iqbal: Welcome to the latest edition of Dialogues in Digital. We have a wonderful guest for you: Bob Evans. It is a delight to finally have a conversation with you on some of the interesting technological innovations you keep talking about. Bob is the ex-chief communications officer at Oracle, ex-VP of communications at SAP, and a fantastic individual who helps organizations with their next-generation vision and puts out unbelievable thought leadership through Cloud Wars. Cloud, as we all know, is becoming the bedrock of every kind of computing, whether it is the right semblance of intelligence, blockchain, data, and so on. Welcome to our show, Bob; it is lovely to have you.
Bob Evans: Thank you for that kind introduction; I hope I can live up to half of the billing that you gave me.
Javaid Iqbal: Perfect. You have personally seen a lot of evolutions for some companies, especially Oracle and SAP, which are the bedrock of how the cloud has turned out. In your opinion, how has the cloud evolved in the last 20 years, and how is it taking center stage? What impact has it taken so far, and where do you see it taking us?
Bob Evans: You know, so often these days – and it is perhaps a sign of the times that I am not a young guy anymore – but I think back 110 years ago when Henry Ford came out with one of the greatest innovations in the history of business & industry, the assembly line. And his line about customers was that they could have a car of any color as long as it was black. That was fine for the time. We think about bringing it a century forward today, you walk into the candy aisle of a store, and there is not just one type of M&M’s but fifty. You can design your own running shoes, design your own car, design your own curriculum, or create the music you hear instead of turning on the television and hoping to find something you want to see.
What an extraordinary world that we live in today. In that Henry Ford line, one of the things that it speaks about the companies is that they held all the power. Today, it is the buyers and the consumers that hold power, right? Instead of “Gee, I hope somebody has something that approximates to what I want,” to “I am going to put out exactly what I want, and I will let others compete for my business,” today. What a remarkable turnaround and underpinning a lot of that, I think, is the cloud technology that you and I are deeply involved in.
Javaid Iqbal: An excellent analogy of how you said customers had become the orchestrators and how companies should innovate for us. The way we are evolving is getting more challenging for organizations since consumers are becoming savvy, demanding things at the time they want, the place they want, and the way they want. Some of these computing powers and the powers of data enable them. How do you think these technology companies are architected culturally and, vision-wise, attacking new ways of thinking to become poised for success?
Bob Evans: If it is okay, let me tick through a few examples here. You have Microsoft that I have ranked at number one on my list of Cloud Wars Top 10, not just because of its revenue, but because of the nature of change that it has brought. Microsoft’s biggest deals are not only transactional deals – they are called partnerships. Often what Microsoft does is engage at a deep IP level with their customers. For example, in Novartis’s case, you combine Novartis’s medical and science experts with Microsoft’s technology experts. They are fusing Novartis’ operational technology with Microsoft’s information technology expertise to achieve what nobody has achieved before. You look at Salesforce, where Marc Benioff often says that customer CEOs’ top conversations are about culture, not technology.
Look at Google Cloud. I wrote yesterday morning mentioned that Thomas Kurian as CEO has changed that company’s culture from top to bottom in under two years. They always had fabulous technology, but Thomas has brought to Google Cloud a sense of customer-centricity and customer empathy. In the past, Google might have looked at their customer and thought: what kind of bozo would cobble together all that crap over the last 40 years, without thinking that it is just what was available at the time. Now, under Kurian, Google Cloud has developed a sense of empathy for customers.
In a company like Oracle, even over the last couple of years when I was there as they switched their technology from on-premise to the cloud, their whole delivery system and cultural idea with on-premise software were: “hey, I’ll drop off some CDs on your loading dock, give me a check, and we are done. It is your problem now.” With the cloud, it is up to the incumbent technology vendors to ensure these customers succeed. Instead of the relationship ending at the transaction, it just begins there because, unless they can drive ongoing success for those customers, the customers are going somewhere else.
The last one that I’ll toss is IBM, an Iconic company. Now, they have turned their entire company finally around the hybrid cloud. They have harnessed all of their capabilities and their wide-ranging business units to service customers leading to the cloud. So, it is an incredible evolution; in the last two or three years, these big tech companies have changed faster than they ever would have thought possible. And then, Javaid, as we all know over the last eight months, that acceleration has had to be magnified even further. It really has been extraordinary to see this all being driven by what customers need. They now have more choices and will exercise those choices if these big tech companies (regardless of how big they are) do not meet their exact, emerging needs.
Javaid Iqbal: A fascinating point that you raise here around the customers. I believe the way that technology is perceived or bought in the last probably 20 years has completely evolved and, to your point, the journey begins when you sign up. Even in my days at Salesforce, one of the things we cited was customer success. If whatever was bought was not implemented right, it does not get utilized, and if it does not get utilized, it does not get renewed at the end because that is the fundamental bedrock of cloud and the entire subscription economy. You are looking not only at the way of delivery of the software, but also the operating model and the commercial model around that. This model, where the cloud becomes the central point of delivery, is a good 2.0 for most of these companies. What do you think is the 3.0 of this? Where do you think these companies will compete next?
Bob Evans: You know, Javaid, I think that is a great question. It is going to be so interesting to see the changes that occur. I’ve been following the tech industry for a long time, and it has been a blast and one of the most extraordinary industries. However, over these last 25, 30 years, a lot of that has been incremental, and I do not mean that dismissively. They have a product that they have made progressively better, made them a little less expensive, added new features. I think this 3.0 version that you have talked about is going to be centered around a few different things, one of which is that example I gave of Microsoft. It is not like we will make some software and you buy and install it. The driver for 3.0 is how we as technology vendors help you, the customer, become the sort of company you need to be in the future to survive, thrive, and do things you never thought were possible. It is not just digitally transforming where somebody has been and making them a little more efficient and productive going forward. It will help those companies change their business models, change their vision, change their culture, and change the heart of value that they offer to the marketplace.
With regards to Microsoft and Novartis, one of the things the CEO of Novartis said when he came in was, “Look: in the pharmaceutical industry, we have done some incredible stuff and changed the world with a lot of pharmaceutical discoveries. But we have allowed ourselves over time to become conditioned to creating a new pharmaceutical product, which takes 12-and-a-half years and $2.5 billion, which is just not acceptable these days. We have better technology. We have better capabilities, new ways of doing things now, but the companies had woven into their cultures to not look beyond that because they didn’t think it was possible.” One of the things the partnership between Microsoft and Novartis is doing is creating something called an ‘AI innovation lab,’ where one of their goals is to discover molecules, medications, or other pharmaceutical products exclusively with data, rather than through trials or human testing. So, I think at the heart of 3.0 is how technology companies come in and fuse their best capabilities with the customer’s best capabilities at a foundational level. It is not just for productivity or efficiency, but they must create entirely new things that neither company could have achieved on their own.
Javaid Iqbal: I think it is also a combination of human capability until that point and the machine’s ability that is teaching us continuously and evolving. As they say, AI is like a seven or eight-year-old child now, growing together with today’s generation, which we will come back to later. Speaking of the computing aspects of business and its evolution, we have talked about the 3.0, where things need to go, cloud infrastructures, and how capabilities need to evolve. It also borders with the ethics of this. We have seen Zuckerberg and Pichai sit in front of the Senate state steering committees. The ethics conversations have been more on consumer computing so far. When does this get to the enterprise computing front, and do you think these cloud computing companies are keeping this in mind as they grow?
Bob Evans: Somebody said the other day that when the tech companies switched their primary model from on-premise delivery to the cloud, they said that one way of looking at it is that we have become the IT organization or a (huge) part of the IT organization for these businesses. They are inside the gates of these companies that they are operating in, in that respect. I think it will be more dependent than ever on these big, enterprise tech companies to ensure that what they are doing is of the highest capability, from privacy to security, to data residence’s regulatory aspects.
We used to talk about data residency; well, now it is data sovereignty. I am telling you: three or four years ago if somebody had tried to tell you that we will confer a sense of sovereignty on data, you would have asked me what I was talking about.
I think the heart of what you are getting at here – so much around data – in your terrific podcast and your show Dialogues in Digital is so much around: can we keep control over data but also give it enough freedom, enough latitude, and the people who work with it enough latitude to use it to its full extent without ever abusing it. Because I think for businesses, it has come to the point where it is not just an inconvenience, a PR hit, or a financial impact for them if they have a breach; The trust that is lost among businesses or consumers is devastating. So, I would hope that there will be a tighter-than-ever collaboration between the tech companies, who are now in part the IT organizations for their customers, and the customers so that they fully understand that we give all those issues that they raise the absolute highest priority because without this we are heading for disaster.
Javaid Iqbal: Absolutely, very interesting answer there, Bob. There is one thing that I struggle with when our team talks to customers and prospects and interacts with Boards and C-Suites of various organizations. It is that a lot of times, I realize that the people who have grown up in the tech ranks within organizations had a specific job to do. They had a particular mandate to keep the lights on or keep the networks and the applications running. However, the other folks who grew up in the ranks of finance, operations, sales, or marketing are used to running the entire show, so to speak. I see a lot of that changing, with chief digital officers, chief information security officers, technologists, and others in the ranks; there seems to be a horizontalization of the types of skillsets needed to evolve organizations, rather than vertical silos. I see gaps in comprehension from the business side for the technology and vice-versa as becoming the blockade in these organizations doing well. Do you think many of today’s leaders understand both of these sides needed to run a 21st-century cloud and AI-enabled organization, and if they do not, what are some of the things that they should understand to succeed in the future?
Bob Evans: Thanks, that is a great question. To some extent or another, that dynamic or interplay has been around for a long time; it just wasn’t as critical as it is today. Because remember: companies would put out seven-year plans or ten-year plans. At some point, they would say: “Well, we are in month 85 of our ten-year plan, and we are pretty much on target. Let’s go to the next item on the agenda.” It is just unfathomable now, the pace at which things used to move relative to today. In those days, when you had seven-year plans and 10-year plans, you had two or three to adjust or fix them or even create a new three-year plan in between. You get three months today. So, while these gaps were tolerable back then – inconvenience like one side not understanding the other side, having to bring outsiders in to understand, etc. – there is no tolerance for knowledge gaps today because, ultimately, what this means is the company is not focused on the customer. They are concentrated on their internal expertise and weaknesses that they try to cover up with cultural or organizational structures.
And then I always thought it was an insult to CEOs when you look at the tech side, where a CIO would say: “My job is to align the technology with the business.” I mean, it sounds okay, but what is the underlying theme there? They are saying that the IT organization is not part of the business because it must somehow be aligned with it, and that mindset is going to kill companies very quickly today. In the same way, if you are an executive in sales, marketing, or product development, and you have built some goofy mindset that says: “I do not need to understand the impact of technology on the decisions we make and where we are headed,” there, too, lies a disaster. So, I think in either sense, these gaps not only must be eliminated and closed; there’s got to be this ongoing spectrum or continuum of expertise anchored around what customers in the marketplace want and need, rather than some five, ten, or fifty-year-old organizational structure that was not good then and is deadly now.
Javaid Iqbal: How has COVID changed a lot of this, Bob?
Bob Evans: As we were getting started, Javaid, I mentioned that I became a grandfather about five weeks ago. I wonder how different a world that little girl will grow up in, compared to someone born five or six years ago (with the vast, personal impact we have been dealing with these last eight or nine months). I think it was Satya Nadella who said that we have seen three years of digital transformation take place in three months. Larry Ellison, at Oracle’s virtual event on CX strategy yesterday, quite bluntly said that the world would never go back to the previous normal and anybody who thinks we are going back to a nine-to-five world, where people would commute for an hour, sit in an office and go back is crazy. Bill McDermott, the CEO of ServiceNow said that the office or the headquarters office would probably be fine. Still, instead of becoming a destination, it will become a productivity tool that you will only use when you need it. This intense focus again is not on operational efficiencies, which are essential, but on business models and the reimagination of what is possible, what is it that people want and need, what I can do to adapt rapidly to that, and how do I shift things that are core to me but no longer valued by the marketplace because of the restrictions right now.
So, it has hypercharged the pace of change. It has also dramatically and extraordinarily changed the extent of that change, right? It is not just about being a little bit faster or a little bit cheaper; it is a totally new way of imagining things. I expect that it will place a great deal of much-needed emphasis on companies saying: I’ve got to do what the customers want, rather than continue to try to do what is convenient or easy, or what I know. I’ve got to move into the world of my customer needs because there is just no hope for companies today without it. I do not say that happily, but it is a matter of unexpected change. A meteor has hit our perfectly good planet and knocked it off its orbit, which is what COVID has done. Everything that we do in our lives is different now. In the business world, anyone who tries to drag stuff from the past – because of what they know and are comfortable with or to survive – is in for a terrible surprise. It is a leadership test that will bring out the best in people, for folks who can overcome this.
Javaid Iqbal: Bob, you are right. I think it is going to get further intensified as things move along. Let’s talk about the customer, especially ones that rely on the SAPs, Salesforces, Oracles, and Microsofts of the world. You wrote a fantastic piece on how customer experience and customer relationship management are intertwined. I want to understand your thoughts on the two different approaches. How does a CRM approach help an organization with the customer versus a CX approach, and where do you think they intersect?
Bob Evans: It is almost like a sports competition, right? If you listen to a boxer talking about their rival and vice-versa, you realize that they do not speak anything remotely familiar with each other. You hear a CX company talk about what Salesforce – a CRM company – does; they say that all the details on sales automation and opportunity lists were relevant yesterday. Then you hear Salesforce talk about CX, and they say that you can never get CX right without getting CRM right. In a way, this is entertaining and interesting strategically, but, ultimately, what is wonderful for business customers these days is that you get remarkably intense competition.
Think about all the companies involved in this: SAP, Oracle, Microsoft, Adobe, ServiceNow (which is coming from a different direction), and the kingpin, the category creator: Salesforce. I think it is so interesting what Marc Benioff has done; a couple of quarters ago, he said that these other guys go out, and they try to create big end-to-end suites and diversify, getting their focus all over the place. We just focus on CRM. But Marc Benioff clearly is no dummy. He has been doing along the way because he took CRM twenty years ago and expanded upon its definition and boundaries. It is a remarkable thing, but there are millions of ways to come at it. I think some of the stuff ServiceNow is doing – they are not in any way trying to compete at the level of bigger, traditional CRM or CX companies– by looking at it from a workflow point of view. Microsoft is the infrastructure partner for many of these companies, yet Microsoft Dynamics 365 is its own CRM. You see maneuverings in diplomacy and engagements of types we have never seen before.
One of the defining things that Larry Ellison said about Oracle CX yesterday is that the other CX automate the sales process, and that is for managers; ours is entirely different because what we do is we help salespeople sell more. While the others’ stuff is management and bureaucracy, ours is about revenue. The careful business customer is evaluating this extraordinary landscape of choices and alternatives, provided those customers are willing to put in the necessary legwork and hardware. Think of the benefit of this competition. Can you imagine these handfuls of world-class companies all desperately innovating as fast as they can, as aggressively as they can, asking to be told what is wanted and then delivering it? It is a great, winning market for any business customers figuring out what to do with it. I am sure the help that your company is giving out to people these days is so essential because there is a range of choices, almost whatever a business customer could imagine. The options are out there, and it is a buyer’s market, which is fascinating.
Javaid Iqbal: Bob. It is funny that you say that. We were helping a massive $5 billion Asian bank buy a customer suite. A lot of these big companies were competing. SAP was coming in from a very CX lens because Qualtrics is their big baby. Salesforce, I knew the nuts and bolts off because of my background. And then Microsoft came in with a little bit of a hybrid approach. I’ve always maintained with my customers they I advise that you also have to look at how some of these companies have evolved. I mean, Oracle, deep down, was a database company that became an application company and moved from there. SAP was around packaging, logistics, and supply chains, and then ventured into other areas. Microsoft’s suite was born out of their Outlook, SharePoint, and other areas before Dynamics. And then Salesforce was Marc [Benioff] basically saying: “Hey, I do not like Siebel; let’s go build something better.”
So in many cases, it is intertwined of so many different leaders from these similar organizations, taking an additional crack at something and then evolving it. But the right thing, as you said, is that eventually, the customer is winning out of this. They have got remarkable technologies and innovations that are coming out of these vendors. Even within the vendor landscape, there’s a frenemies aspect – Salesforce was built on the Oracle kernel, yet they were competing. Now, where do you see AI taking this? One of the conversations I was having with a CIO recently was that if you look at computing or these applications as they evolve, it is a box with all sorts of data going in and out of it through a layer, whether it is conversational or voice-enabled or whatever. So, the engagement layer is evolving along with the backend data layer. Conceptually, how do you think that AI has changed the dynamic to become more customer-focused, and where do you think it will go in the future?
Bob Evans: First, I just want to say that language matters a lot. I think it is so interesting to think about artificial intelligence. I do not know when that term was coined, maybe 30, 40, 50 years ago?
Javaid Iqbal: It was coined in 1959.
Bob Evans: 1959, so, 60 years ago, and at the time, to the best of anybody’s understanding, it was intelligence, but it wasn’t really real. It was in some machine, but it was not something very well understood. Today, it is as real as anything that you can imagine. Nobody is going to change the name, but I think we are going to hear more about AI. Five years from now, kids in school will ask what does that stands for, and nobody will believe it is artificial intelligence since it is involved in everything that they do and everything they touch. I think that another way to look at AI is through two terms where I think its biggest potential is, to answer your question as I believe it is “accelerating innovation”. I think it is going to free people up from doing the drudge work – and I do not mean that in a negative sense – but slogging through things that technology was created to automate, providing people with more insights that allow them to make the best choice, pass it along to customers, help people in the world that is moving faster than ever before. AI can also mean “accelerating insights”. It can plow through mountains of data in this new data economy to allow people to get to the right choice and the right ideas. I think we are only scratching the surface of its real potential in taking this raw material – the data – that is sitting like gold under a mountain. It is going to take some of these new AI solutions to extract that gold from the mountains where it sits.
I also think, Javaid, about the question that you broadly asked with regards to machine learning. Some of this AI/Machine Learning has been around for 30 years, so why did it never become as prominent as it is now? The companies that could build these massive systems for machine learning had to hire armies of data scientists to make the whole thing work. Thomas Kurian from Google Cloud said last year that these big businesses know what they must do but to do it themselves, they would have to hire 500 data scientists. It is possible, but you are not in the business of hiring data scientists who, once they come on board, must be given hardware and set up. Alternatively, you can now go to some of these companies that specialize in providing this as a service.
Again, I think the cloud is the delivery mechanism for AI and ML solutions at their highest, most beautiful form for businesses. That is why I think we see this extraordinary level of innovation being unleashed around AI and ML. It took the widespread adoption of cloud to make this possible, and I think we are just at the beginning of what these tech companies can do in both weaving AI and ML into their existing products and also creating unique AI and ML services that businesses can use for their particular outcomes.
Javaid Iqbal: Very well put, Bob. Speaking of these cloud companies, I know you have talked quite a bit about the top 10. Which ones do you think are not currently at the top 10 for you are up-and-coming, and where are they chipping in?
Bob Evans: Javaid, I never meant for Cloud Wars Top 10 to be exclusionary. Let me just take a second to tell you why I did that. Four years ago, I decided I had had a lot of fun at Oracle, but I wanted to start my own business, and I ended up creating two. The Cloud Wars Top 10, I said, basically were the companies to have a disproportionately large impact on the world, so I want to focus on them.
Also, I do not think that there had been enough rigorous coverage of them. It is hard to understand enough about the technology and the business to see where they are going. Besides, this is stuff I like. So I wanted to get into that. Also, I do not wish to have employees at this point in my life and my career. I love people, I love working with other people, but I do not want to go through the bureaucracy and have employees. So, I had to tailor what I covered and what this company is about to something that I could manage. Ten seemed like a number that I could handle. I have enormous respect for all the tech companies that are out there. Some of these smaller vibrant ones are coming in, and they are disrupting companies that are a thousand times bigger than they are, forcing these big companies to stay really fast, really nimble, and do not ignore the fringes. It has caused a new level of awareness.
Andy Grove talked about the value of being paranoid about things, which is good because I think it will help those ten big companies move faster and innovate quicker. They are going to say, if I thought I was tied in closely with my customers before, I would better double down on that. You have seen it in FinTech, you have seen in MarTech, you have seen it in a lot of these other industries where these small, nimble guys are coming up. They can do a wildly disruptive point solution. In the past, we would have been able to gloss over that and say: “Oh, well, that is something I’ll add in two years,” or “I’ll make it hard for them to integrate with my stuff.” All those things are gone. One of the things Larry Alison talked about at the CX event for Oracle yesterday was that every company in every country on Earth is going to have full, unfeathered access to the best talent in every country on Earth. He said that we have knocked down these barriers. It is going to be one of the things that would allow smaller, nimbler, and more aggressive companies to come in and do things that are more responsive to customer needs, that are more focused on where customers are headed, and less so that mindset that all big companies get of having to protect their legacy and their status quo. These small companies have a tremendous future for them, and I hope they can keep coming up and make the big guys be the very best that they can be all the time.
Javaid Iqbal: Very well said again. It is funny – the number of things moving the cloud, not just enterprise software. We are doing a lot of work right now in the cloud communications space—CPaaS, which is communications-platform-as-a-service, where we are global partners with Vonage. You see Vonage Twilio, RingCentral, 8×8, and so many others that are almost becoming the last mile of the customer, with voice, video, texts, and everything driving some of these crucial customer behaviors. And I think that is what led SAP to buy Qualtrics as well, where they dropped about $8 billion on them. So, a lot of evolution, lots more data, lots of bandwidth, loads more computing power, and a lot more AI coming through the ranks. And like you just said, we are only at the beginning of this; there is a lot more yet to come through. Any parting thoughts on the evolution of technology throughout your years of working, and the good, the bad, the ugly, or what scares you about it?
Bob Evans: Javaid, this has been a great conversation, and thanks very much for having me. You know, I am an optimist by nature, but also by my choice. I want to share one thought: inside companies, there is a tendency – as we have talked about –the cultural aspect that just cannot be overlooked because that drives everything. Today, whatever business somebody is in, be it technology, retail, restaurants, trucking, manufacturing, or whatever, there has been a tendency in leaders for a long time to say things like: “Uh, that is not what we do, that is not the business we are in, that is not blah, blah, blah,” and in some cases, it is the right answer. More and more today, it is less about businesses continuing to be in the business they were in than they have got to be in the industry that their customers want them to be in.
I think of this wild, new generation of cloud technology, artificial intelligence, and the speed at which some of this stuff can. And the cloud brings to the smallest entrepreneurs on Earth the same level of computing capability and capacity and power is the most prominent companies on our, so there’s been a leveling there that is come up in any big company in any industry. If there are leaders who are blinded to these changes happening out on the margins coming up that haven’t sort of cracked through and become a deadly existential threat to them yet, they got to start to think that way. And I think the field that you and transform IX ran about CX and tying into that, how tightly can you connect the way you think and what you do to where the marketplace is headed, rather than believing that, you know, if I just stay in my lane and, you know, do not get too caught up in all this craziness around me, I’ll be fine because it is, it is a very, very different world than it was a year ago, five years ago, and certainly seven or ten years ago.
So the future belongs to the bold, and the brave, I think, is trying to say, I will move as fast and as radically as the marketplace needs me to move. And the cloud has been the cause of that. Thanks for the opportunity to exchange some ideas with you and your audience; it has been great to spend time with you.
Javaid Iqbal: Bob was a complete pleasure. We ultimately want to thank you for what you talked about today, but you know, your contribution to space. Overall, it is a testament to how one person and their army can make a massive difference. So please keep doing what you are doing. This will not be the first or the last time we will talk about some of these things. We’ll do more collaborations in the future as well. And we wish you all the best in your current and future endeavors.