Gjis van Zon, Innovation Consultant at Freshheads.
We all know change is necessary to remain relevant in a constantly changing world. And in the ideal situation, everyone within your organisation takes part in this important journey. But innovating requires a lot of your people. After all, it is pretty scary to deviate from the familiar path to do something you don’t yet know (very well). How do you get your employees and your organisation as a whole into the right mindset? And what is the best approach: to innovate in a fixed team or organisation-wide? With this article innovation consultant Gijs van Zon helps you to find your own way.
An underpinned foundation
“A misconception I encounter quite often is that companies think they have to innovate. Our competition is doing it, so we need to do it too – that sort of idea. This may be true, but innovating as an organisation is not a goal in and of itself. It is a trajectory that emerges in a logical line from the purpose for which your organisation was created.
If you innovate in this way, it’s easier to get your people on board. After all, you’re building on a story they already know, and that makes it less scary or strange. So, my advice is: start from the vision and ambition of your organisation and translate this into strategic goals and frameworks. What developments do we envisage in the market, what is our role in this, where do we see ourselves in three, five, or ten years? And who or what do we need to achieve that?
Share these frameworks in your organisation, so that everyone feels included and your employees feel part of the journey. What can I do or contribute to make this ambition a reality? What is my place in this vision? These are questions to which your employees are looking for answers. After all, everyone wants to do something that has value, and this is how you help them find that value (again). An added benefit: in this way, opportunities – regardless of the level or department of your organisation in which they arise – are also recognised and developed more quickly.”
Start small and communicate
“Change is not something you do overnight. Start with one specific goal and with a select group of people in your organisation. Choose low-hanging fruit; opportunities that are up for grabs in your organisation and that produce returns relatively quickly. Share your experiences, ask for input and allow other colleagues to contribute ideas to make it relevant to them. For example, provide demos of the experiments you’re rolling out and what you’ve accomplished with them. Show what was successful, but also certainly where the experiment showed that the idea had failed. Often, this is where the most interesting lessons are to be found.
I can hear you thinking: “But we want to see fast results everywhere!” You achieve that precisely by starting small. Believe me: small steps forward are the key to change in any organisation. Especially when you’re aiming for good and lasting results. Realise that this is necessary to bring about structural change in your organisation. You will see that this leads to more and more people in your organisation becoming enthusiastic about your new way of working. So, keep communicating. Take the people with you. Until it becomes commonplace for everyone.”
Choose what suits your business
“If you ask me, it works best to use your own people to make changes in your organisation. In fact, it ensures that you have and retain much-needed knowledge in-house. But where to start? Because yes, change is and remains scary!
Bringing in an outside party can be a great idea to kickstart your innovations. They have specific knowledge that may be missing from your own organisation at the beginning. But preferably choose a mixed form, so that you always keep track of how certain steps come about. At Freshheads, we do just that. For our clients, for example, we do interviews with the end users of potential digital services to find out their needs. Those conversations always include someone from our client. At a certain point, things change around. They do the interviews and we just help with the preparation. In this way, the client acquires indispensable knowledge directly and will be able to understand how results are produced and how they can be translated into the next experiment or prototype. Being fully in control as an organisation is the result. The next step? Carry on with the changes that have been initiated, with or without outside help – but above all with your own people.”
Gijs van Zon is an innovation consultant at Freshheads. Together with the client, he looks at whether everything is in place for innovation projects to succeed: the right people with the right expertise, the ability to scale up if it’s a success or to pull the plug in time if the project fails.
Pandora took the business world by storm this year as the renowned international jewelry retailer successfully drove digital transformation and innovation in the midst of COVID-19 and launched the much-talked-about Digital Hub.
To find out more about the Digital Hub and Pandora’s agile aspirations, Management Events interviewed Pandora’s CIO, Peter Cabello Holmberg, winner of CIO of the Year 2020, who shared the objectives of the ‘Hub’ and its importance in Pandora’s continued digital strategy.
The Digital Hub, also known as the Hub, opened its doors in Copenhagen in July 2020. But what exactly is the Digital Hub?
The Digital Hub is actually a place. It’s a physical location; a full floor in a building next to our global office, where we have room for some 200 headcounts. We initially called it ‘Global Office 2’, but as we wanted to create some hype around digital and our digital strategies, we decided on ‘Digital Hub’.
Also, we were running out of space in our global office, and we had pockets of digital talents – the IT, marketing, and e-commerce teams – sitting in different places globally. That wasn’t optimal so we wanted to consolidate our digital talents in Copenhagen.
We believe that having our digital talents in the same location would help our delivery speed, and our intention was to have a new layout of office space that could facilitate agile ways of working, where people can move around and sit in teams to exchange knowledge on a daily basis.
In the early phases, we discussed building it in New York or Amsterdam, but we decided to build it next to our global office in Copenhagen because there was a need for proximity with the rest of the senior executives there. We were super lucky that we could get the office space next to our global office.
How did the idea of the Hub come about?
We’ve been working with our thoughts and aspirations on digitizing across our value teams for a couple of years. And what we realized was that we had to orchestrate ourselves differently to deliver faster on our digital aspirations.
We’ve been relying on waterfall approaches, business cases, and other methods that were very slow for us to get things started and signed off, so we needed a different operating model and a different engine room.
It was that realization – for us to deliver on our digital aspirations, have more transactions on our online channels, and improve digital marketing, omnichannel, and in-store technology – that we felt the need to bring the technology, e-commerce, and marketing teams together and implement new, agile ways of working.
Projects like the Digital Hub are huge investments, and getting the stakeholders’ buy-in is always a challenge. How was the project presented for the executive buy-in?
I went to the CEO and the executive leadership teams a year and a half or 2 years ago and said that we needed to do an IT transformation. I said that I would save money for the company, build new career duties, and introduce agile working. And I got a sign-off on that.
The CEO bought into it because we – on top of the savings – also presented strong business cases for digitalization and data-driven consumer growth that were very attractive with significant incremental revenue.
AGILE WORKING AND CHANGE MANAGEMENT
After getting the sign off on introducing agile ways of working, how did you start its implementation?
We did a number of introduction sessions before we did anything else. We talked about what agile is, its meaning and principles, and the choice of methodology, and introduced the terminology. We also did a few proofs of concepts, small projects that we would normally put into an agile release train (ART), and applied agile ways of working, like scrum meetings.
Other than that, we had meticulous discussions about Spotify and SAFe, and supporting tools for agile ways of working. We initially made a decision to go with both models, which was a mess for us. Now we’re back to the principle of one model.
We made some decisions along the way that were just wrong. So when we went live, we went in knowing that we had to learn if the decisions and changes worked and asked everyone to give feedback so that we could adjust on areas that didn’t work.
Major organizational transformations can be difficult to execute smoothly. How did Pandora handle the change management?
This was a massive change management exercise, but we knew we had to shift our ways of working completely.
So we gave people a flavor of how this change would look. We started to talk about what an ART should be like and introduced new and different roles to both the business and organizations. We pieced it step by step, presenting increasingly more elements of agile working.
There was change management happening both bottom-up and top-down, but at some point, we came together and communicated to everyone involved that ‘This is how it’s going to look, and here are the members of the Arts’.
We communicated the incoming change to all parts of the organization with 50 to 70 lightning talks about agile working held for all the employees to participate. More than 1,200 people from the entire business signed up to learn about it.
Even when we went live with our first ART, we continued having lightning talks because more and more people wanted to know about it.”
We try to stay as open and transparent along the way so that everybody knows what was happening. It was a lot of communication on where we were, what was happening next, and what to expect.
HIRING AND TALENT MANAGEMENT
With all the transformation initiatives, what were the responses from the teams and employees?
The interesting thing is, as we implemented the agile ways of working, our churn rate of people in IT, marketing, and e-commerce leaving Pandora has gone down. Even though we did this massive transformation, the turnover rate has decreased.
From what I’ve seen and heard, people are actually quite excited to try agile working. They want to see how it works. Some have already tried it and are super happy with it. And those who have always worked in traditional waterfall approaches are keen to learn about agile ways of working because everyone’s talking about it.
With about 200 employees working on a collective digital strategy, how does the Hub ensure that decisions and responsibilities are delegated to the right people and teams?
We have a number of ARTs now, and the biggest and most mature one is our consumer ART.
Whatever the team does in this agile release train is tied to our business strategy, so there’s a link from the strategy to how we work with agile portfolio, lead portfolio management, and so on. So we can track from strategy to ARTs to APEX to features to use cases.
Since we have defined the ART with all the members and different roles, there’s full transparency on who’s responsible for what. Everyone knows what their role is in the whole process.
Furthermore, the tool that we use holds the overall description of the business strategy, and breaks down into the related ARTs and components, so that we’re constantly updated on the business timeline and deliveries. Hence, I would know exactly what’s going to be delivered and when. It’s pretty amazing.
It’s not news that Pandora has been actively hiring digital talents for the Hub. What talents are being seeked, and what hiring strategies are being used?
We’re hiring very different types of profiles into the Digital Hub from all over the world – Columbia, Argentina, the US, and Singapore. We want people who are creative, who have an opinion, who want to push things forward and make a difference. And because we also want to set them free with the business, we want them to be self-operating.
What we did with hiring was create hype around the Digital Hub. We had the CEO talk about the Hub when he was interviewed, and we sent out press releases and reached out to different media. We also talked to universities about what we were doing and trying to achieve and spread the word that we wanted to build a digital powerhouse in Pandora and be number 1 in our industry.
So we set the ambition level quite high, which is part of attracting talents while doing features and events and mobilizing all types of channels to spread the word.
What challenges did the Digital Hub encounter in terms of recruiting talents and managing the current workforce?
One of our bigger problems was that, when we got a ‘go’ for the Hub, it was the time when COVID-19 hit. So we had to hire these positions using Teams and Zoom since we couldn’t meet the candidates face-to-face.
We also had to go about the hiring processes in a different way because everybody was on lockdown globally, and we couldn’t fly them in and bring them to the Digital Hub. From Day One, they had to start from their home office. We sent PCs and laptops to them, and onboard them from their home and whichever country they were in.
Now that the Hub is completed, what initiatives is Pandora taking to ensure a functional communicative and collaborative culture?
The Hub initially was driven by the CDO, CIO, and our SVP for data analytics. Now that we have consolidated these functions under a CDTO then the Hub is anchored with the CDTO. We’re trying to create a community so that the Hub is seen as one team with one common purpose.
Now, the Digital Hub has its own dynamics, and there are social events, fireside chats, and town halls where people across different organizations can participate. We put these people together in one location, and what this has actually done is broken down the silos that we were experiencing previously.
We’ve been sitting on different floors, in different buildings, in different countries. Now that we have brought the teams together, they talk to each other every day – they literally sit next to each other – so it has broken down the silos between different functions. We’re much more aligned compared to before, and that is a huge improvement for us.
DATA AND DIGITALIZATION
In terms of technology and innovation, what challenges did you face with the Hub?
We didn’t have many challenges with our technologies and choice of technologies when we started the transformation.
We already had a roadmap on what to do with data. We had our online platform, our salesforce, e-commerce, and cloud. Our biggest challenges are with integrations, master data, and a scattered point of sales landscape. But overall, we are in fairly good shape.
What stage is the digital transformation of Pandora at the current moment? What other processes are underway to boost the brand’s digital experience?
What we have now is a pretty solid digital strategy that has been shaping up over the last 8 months or so.
We’re going all in on our user data for tips on marketing and personalization. We’re also considering communities for people who are interested in our type of jewelry, and planning to introduce a global loyalty program that will hopefully further drive brand loyalty.
The consumer ART is working with data, and working with the marketing team on digital marketing and personalization. In regards to data-driven consumer growth, we also set the teams free to use data to drive sales. By combining the different data sources that we have, such as our transactions and customer browsing data, the ART teams are free to make decisions on their own to allow faster decision-making.
What are the biggest differences between the company’s past and present data utilization?
It’s two different worlds before the Hub and after the Hub is live. The incremental revenue that is delivered from our data-driven consumer efforts is just outstanding.
We’ve built the integration between different sources in our stack, applied new technologies, and hired Ph.D.-titled profiles to work with data so that we can learn more about our consumers.
We didn’t have that data focus a year and a half ago. I think we had one person in Pandora working with data, but now we have 60+ people working only on advanced data analytics and the use of data.
SUCCESS AND THE FUTURE
What do you consider to be the key achievements of the Hub?
What’s interesting is that the agile way of working that we implemented has really proven its value when the pandemic hit.
Our stock prices have gone up some 100% during 2020 when COVID-19 hit, and that’s quite amazing. It’s actually all down to our technology readiness and the shifts from physical stores to taking advantage of our online channels and digital initiatives.
We were able to step back and look at our priorities and completely change our focus, and now the rest of the business – HR, finance, and other parts of our commercial organization – want to embrace agile working because they see its value. This is just the start and we want to do even more.
Additionally, we see that we can move much faster now. Because the teams are dedicated to the agile release trains (ARTs), they’ve become very efficient and knowledgeable about their role, purpose, and responsibilities. So we’re able to come up with solutions to business strategies at a faster rate.
There are always expected ROIs for major projects. What is the anticipated ROI in 2021 due to the Hub?
When we first started, my focus, and marketing’s focus, was on revenue-generating and return on investment. It was clear when we went to our CEO that what we proposed was very attractive and that data-driven consumer growth, meaning advanced data analytics alone, would pay for our Digital Hub. And we still have many other initiatives that we’re driving.
In some cases, in terms of ROI, we’re talking about a factor of 10 of the investment. Also, our stock prices have gone up significantly because we took advantage of our online channels and digital initiatives. I think that alone shows the impact of getting digital right.
What are the upcoming plans and strategies for the Digital Hub and Pandora?
We are in the middle of finalizing our digital strategy for the next 3 to 5 years. We never had a digital strategy before, but now we have it, and it sets the direction for our technology investments across our value chain – where we want to invest our bodies and resources.
Also, we’re focusing on how we can take agile working and our technology operating model to the next level. Yes, we started out with Agile but we’ve only been live for a year or so. Now, how do we bring this further? What do we need to invest in? What kind of profiles, like what agile coaches or release train engineers, do we need to bring on board to further mature our agile ways of working?
What commercial goals does Pandora seek to achieve in 2021? What role does the Hub play in achieving these goals?
Our key focus right now, and into the next 3 to 5 years, will be on revenue-generating initiatives. We want to drive even more revenue through our online channels.
Aside from that, we’re also focusing on creating an even more seamless customer journey across our different channels. We want to engage with our consumers in a more meaningful way – be more precise in what and when we communicate so that we become more relevant.
Of course, we do all of these to drive revenue, and the Digital Hub is instrumental for us to proceed with the plans.
Innovation in HR has always been the key focus for organizations in discovering and adopting new solutions, improving workflow and productivity, and to innovate and excel. In today’s COVID-19 world, Maistering BV’s Chief Sales Officer (CSO) Venkat Iyer (Markets, Sectors & Domains) understands that innovation in the HR industry is needed now more than ever to remain efficient in these new times.
The Focus Of Innovation In New Times
The role of HR leaders has always been to be at the forefront of innovation. From innovating workflow processes to adopting intelligent solutions and creating a better employee experience, HR leaders are pivotal when it comes to innovation and business improvement.
However, the current crisis has pivoted the outlook for HR leaders, pushing them to adopt new approaches for workflow efficiencies in the shortest timeframes. Especially in today’s remote working conditions, businesses need to remain efficient and prioritize quality over quantity.
For Iyer, the key points of focus that HR leaders need to be aware of can be summed in three major points:
1. Promoting digitalization and increasing productivity by understanding how technology can improve the workflow of people in the organization.
2. Shifting from complicated processes to simple ideas. Simplicity in HR can also mean leveraging distributed intelligence from the employees and efficient use of AI solutions.
3. Engaging the external workforce in an agile and unprecedented way. As remote working becomes the norm, skills become readily available in the digital marketplace, and HR needs to adapt to tap this availability for business needs.
The shift towards new technology and digital platforms is a necessary shift for HR leaders. Despite traditionally focusing on innovating processes, employee experience, and talent identification, Iyer says that the “current situation has encouraged us to look at digital connections among employees, simplify processes, and leverage skills in a digital marketplace.”
Adapting To Change And Innovating In HR
In the ‘new normal’, HR leaders cannot rely on the traditional ways of managing organizations. While Iyer points out that HR leaders have been quick to “introduce and manage change consistently over the past years”, the current situation demands an environment that is more driven by technology.
“Adopt AI services and solutions, embrace the cloud, and live in the virtual employee realities by introducing digital methods,” notes Iyer.
As these are business priorities for organizations anyway, Iyer believes that leaders can adopt these new methods and ride the wave while still keeping past priorities in check.
Of course, leadership will play a key role in fostering innovation, and Iyer highlights how most HR leaders are addressing the challenges through a familiar process of “defining the problem, addressing the variables that make it complicated and agreeing on the best way forward.”
However, in these ‘never normal’ times, Iyer believes that HR leaders need to adjust and develop a new core capability: a simplicity mindset.
With HR now working around the clock, to be truly effective, Iyer mentions the need for leaders to embrace the mindset of collaboration and simplicity, foregoing the traditional linear thinking and embracing a collective intelligence where the organization is the team.
Prioritizing The Digital Transformation In HR
With the new challenges faced by HR leaders today, the journey towards organizational improvement has shifted towards digital transformation and solutions.
Iyer points out that for HR leaders to be at the top of their game in these new times, they need to embrace digital transformation and start new journeys in utilizing effective but simple tools to tackle complex and complicated problems.
The three key technologies that Iyer believes HR leaders should prioritize are:
ARTIFICIAL INTELLIGENCE (AI)
Chatbots have been part of HR systems for quite some time, helping to answer employee queries. But it’s time to step up the game via managing change, tracking employee emotions to help with health, seamless collaboration and open information exchange, aligning to business goals and tracking KPIs, and creating an impact – AI can help vastly in all of these.
With services available today in many areas that embrace the digital workplace and workforce, HR leaders should step up on AI adoption.
CLOUD
Only a few years ago, companies were discussing the benefits of systems such as the cloud. Today, they have embraced it.
Cloud-based systems are being used more and more for a variety of reasons, and the same is true for HR platforms and solutions as well. The possibility of being able to manage and complete work through a digital platform has allowed employees not only to do the job much faster, but most importantly, it has allowed for significantly increased earnings.
The use of cloud-based platforms also brings about numerous benefits such as reduced costs, greater and easier access, predictability and availability, and better reach.
COMPLEMENTARY PLATFORMS
In addition to core HR platforms that companies have adopted, the need for additional services that complement these massive platforms, and how it can be quickly integrated and used become increasingly important.
Solutions that improve collaboration and ideations, connect to external workforces, match talent with availability, organize and orchestrate HR journeys, measure impact, and are more predictable are vital to companies.
Establishing A Culture of Innovation
Iyer emphasizes that HR leaders today need to adapt and learn new methods in cooperation with employees, business partners, and stakeholders to foster a modernized culture of innovation.
“How can you create and maintain a culture of innovation when almost all of your workforce is working from home?”
Facing these challenges should be at the center stage for HR leaders. For Iyer, it’s important to adapt to the digital workplace while still ensuring that innovation contributes to both the employee experience and business needs of the organization.
To do so, Iyer believes that the following 3 methods should be considered by HR leaders to cultivate the innovation mindset in today’s digital workplace:
Create new behaviors that reflect not just your company values, but also the current digital workplace style
Spawn global and virtual digital ideation sessions
Capture and share learnings and ideas openly
All of these can be achieved by having a digital platform that complements the existing HR solutions in the organization. New times call for new journeys for sure, but technology today can help to make those journeys magical.
Maistering BV understood this and created the unique platform Master Collections. It addresses this topic by providing leaders the ability to run magical business journeys with essence, beauty, and impact in a way that classical HRM systems simply cannot.
Innovating Towards The Future Game Changers
The changing workplace requirements have caused a major shift in all industries, and for Iyer, there are several game-changers that HR leaders need to prioritize to maintain innovation.
In essence, the three major game-changers that HR should focus on are:
Prioritizing Re-Learning and Re-Skilling: HR leaders should now focus on re-skilling their potential employees to make them efficient and equipped with the skill of multitasking. Learning & Development would take place in a new digital collaborative platform.
Quality over Quantity: Taskforce optimization, performance management, and talent identification will all focus on top talent and work, which also mean that hiring and role filling will be different.
External Workforce Management: The pandemic has also exposed a wide variety of available talent, which few have looked at – temporary workers, contractors, project-based hires, and deliverables-based work packages. This also necessitates the need to have systems that can adapt and accommodate externals quite easily and consolidate content and let them collaborate seamlessly with existing employees.
The path towards innovation has changed tremendously due to the pandemic. Businesses and organizations need to undertake new journeys for talent & HR leadership to achieve a culture of innovation. With their platform, Master Collections, Maistering hopes to navigate leaders and businesses into the new times with the right tools.
As these are business priorities for organizations anyway, Iyer believes that leaders can adopt these new methods and ride the wave while still keeping past priorities in check.