 From around the globe, it's theCUBE, presenting Cube on Cloud, brought to you by SiliconANGLE. Welcome back to theCUBE's special presentation on the future of cloud. You know, three years ago, Alan Nance said to me that in order to really take advantage of cloud and drive billions of dollars of value, you have to change the operating model. I've never forgotten that statement and have explored it from many angles over the last three years. In fact, it was one of the motivations for me actually running this program for our audience. Of course, with me is Alan Nance. He's a change agent. He's led transformations at large organizations including ING Bank, Royal Phillips, Barclays Bank, and many others. He's also a co-founder of Citrus Collab. Alan, great to see you. Thanks for coming on the program. Thanks for having me again, Dave. All right, so when we were preparing for this interview, you shared with me the following. You said enterprise IT often hasn't really tapped the true powers that are available to them to make real connections to take advantage of that opportunity, connections to the business, that is. What do you mean by that? Well, I think, you know, we've been saying for quite a long time that enterprise IT is certainly a big part of our past in technology, but just how much is it going to be in the future? And enterprise IT has had a difficult time under the cost pressures of being a centralized organization with large expense and large habits, while at the same time, we see obviously the digital operations growing, oftentimes in separate reporting structures and closer to the business. And what I'm thinking right now is enterprise IT, if it has made this transition to cloud operating models, whether they are proprietary or whether they are public cloud, there's a huge opportunity for enterprise IT to connect the dots in a way that no other part of the organization can do that. And when they connect those dots working closely with the business, they unleash a huge amount of value that is beyond things like efficiency or things like just providing cloud computing to be flexible. It has to be much more about value generation and I think that a lot of leaders of enterprise IT have not really grasped that. And I think that's the opportunity sitting right in front of them right now. You know what I've seen lately, I wonder if you can comment is, you know, obviously we always talk about the stovepipes, but you've seen, you know, the CIO, the chief data officer, that you just mentioned the chief digital officer, the chief information security officer, they've largely been in their own silos. I'm definitely seeing a move to bring those together. I'm seeing a lot of CDOs and CIO roles come together. And even the chief information or the head of security reporting up into that where there seems to be, as you're sort of suggesting, just a lot more visibility across the entire organization. Is it an organizational issue? Is it a mindset? I don't know if you could comment. Well, I would say it's two or three different things. Certainly it's an organizational issue, but I think it starts off with a cultural issue. And I think what you're seeing and if you look at the more progressive companies that you see, I think you are also seeing a new emergence of the enlightened technology leader. So with all respect to me and my generation, our tenure as the owners of the large enterprise IT is coming to an end. And we grew up trying to master the complexity of the silos, as you so definitely pointed out. Out we were battling this sprawling technology, trying to get it under control, trying to get the costs down, trying to reduce capex. And a lot of that was focused on the partnerships that we had with technology suppliers. And so that mindset of being engineers, struggling for control, having your most important part of being the technology company itself, that now I think is giving way. It's giving way to a new generation of technology leaders who haven't grown up with that culture. And oftentimes what I see is that the new enlightened CIOs are female and they are coming into the role outside of the regular promotion chain. So they're coming to these roles through finance, HR, marketing, and they're bringing a different focus. And the focus is much more about how do we work together to create an amazing experience for our employees and for our customers and an experience that drives value. So I think there's a reset in the culture and clearly when you start talking about creating a value chain to improve experience, you're also talking about bringing people together from different multidisciplinary backgrounds to make that happen. Well, it makes me think about Amazon's mantra of working backwards, start with the experience. And a lot of CIOs that I know would love to be more involved in the business, but they're just so busy trying to keep the lights on, like you said, trying to manage vendors and the like. I had a discussion the other day, Alan, with an individual and we were talking about how you got to shift from a product mindset to a platform mindset. But you've said that platform thinking, you're always ahead of the game. Platform thinking, it needs to make way for ecosystem thinking. You know, unless you're in a giant scale business like Amazon or Spotify, you said, you're going to be in a niche market if you really don't tap that ecosystem. Again, if you could explain what you mean by that. Well, I think right now if this movement to experience is fundamental, right? So, Joe Pine and Jim Gilmour wrote about the experienced economy as far back in 1990. But the things that they predicted then are here now. And so what we're now seeing is that consumers have choice, employees have choice. I think the pandemic has accelerated that. And so what happens when you put an enterprise under that type of external pressure, is that it fragments and it can fragment into ways. It can fragment dysfunctionally. So that every silo tries to go into a defensive mode, protective mode. That's obviously the wrong way to go. But the fragmentation that's exciting is when it fragments into ecosystems that are actually working together to solve an experienced problem. And those are not platforms, they're too big. You know, when I was at Phillips, I was very enthusiastic about working on this connected healthcare platform. But I think what I started to realize was it takes too much time, it requires too much investment and you are bringing people to you based on your capability. Whereas what the market needs is much more agile than that. So if we look in healthcare for instance, and you want to connect patients at home with patients with the doctors in the hospital. In the old model, you say, I'm gonna build a platform for this and I'm gonna have doctors with a certain competence that they're gonna be connecting into this. And so are the patients in some way and so are the insurers. I think what you're gonna see now is different. We're gonna say, let's get together a small team that understands its competence. So for instance, let's get an insurance provider, let's get a healthcare operator, let's get a healthcare tech company and let's pull their data in a way that helps us to create solutions now that can roll out in 30, 60 or 90 days. And the thing that makes that possible is the move to the public crowd. Because now there are so many specialized suppliers, specialized skill sets available that you can connect to through Amazon, through Google, through Azure, that these things that we used to, I don't know, I think were very, very difficult are now much easier. I don't want to minimize the effort, but these things are on the table right now to revalue. So you're also a technologist and I want to ask you, and everybody always says, the technology's the easy part, it's the people and the process and we can all agree on that. However, sometimes technology can be a blocker and the example that you just mentioned, I have a couple of takeaways from that. First of all, the platform thinking sounds like it's more command and control and you're advocating for, let's get the ecosystem who are closest to the problem to solve those problems, however they decide and leverage the cloud. So my question is from a technology standpoint, does that ecosystem have to be in the same cloud with the state of today's technology? Can it be across clouds? Can it be their pieces on-prem? What's your thinking on that? I think exactly the opposite. It cannot be monolithic and centralized. It's just not practical because that would cause you too much time on interoperability and who owns what. You see the power behind experience is data and so the most important technical part of this is dealing with data liquidity. So the data that for instance, somebody like Kaiser has or the Harvard Melfi Healthcare have or the Phillips have, that's not gonna be put into a central place but for the ecosystem mobilization, there will be subsets of that data flowing between those parties. So the technical part here is how do we manage data liquidity? How do we manage the security around data liquidity? And how do we also understand that what we're building is going to be ever-changing and maybe temporary because an idea may not work? So you've got this idea that the timeliness is very, very important. The duration is very uncertain. The motor, the energy for this is data liquidity, data transfer, data sharing, but the vehicle is the combination of probably crowd in my mind. Somebody said to me that data is like water. It'll go where it wants to go, where it needs to go. When you can't try to control it, it's let it go. But now of course many organizations, particularly large incumbent organizations, they have many, many data pipelines. They have many processes, many roles and they're struggling to actually kind of inject automation into those pipelines. Maybe that's machine intelligence. Really do more data sharing across that pipeline and ultimately compress the end to end cycle time to go from raw data to insights that are actionable. What are you seeing there and what's your advice? Well, I think you make some really good points. But what I hear also a little bit in your observation is you're still observing enterprises and the focus of the enterprise has been on optimizing the processes within the boundaries of its own system. That's why we have SAP and that's why we have a Salesforce and to some degree even ServiceNow. It's all been about optimizing how we move data, how we create products and services. And that's not the game now. That's not an important game. The important game right now is how do I connect to my employees? How do I connect to my customers in a way that provides them a memorable experience? And the realization is, and we've seen this already in manufacturing for some years, I can't be all things to all people. So I have to understand where the first part of data comes in. I have to understand who this person is that I'm trying to target. Who is the person that needs this memorable experience? And what is that memorable experience gonna look like? And I'm gonna need my data, but I'm also gonna need the data of other actors in that ecosystem. And then I'm gonna have to build that ecosystem really quickly to take advantage of the system. So this throws a monkey wrench in traditional ideas of standardization. It throws a monkey wrench in the idea that enterprise IT is about efficiency. And if I may, I just wanna come back to the AI because I think we're looking in the wrong places for things like AI. And let me give you an example. Today, there are 2.2 million people working in call centers around the world. If we imagine that they work in three shifts, that means that any one time, there are 700,000 people on the phone to a customer. And that customer is calling that company because they're vested. They're calling them with advice. They're calling them with a question. They're calling them with a complaint. It is the most important source of valuable data that any company has. And yet what have we done with that? What we've done with that is we've attacked it with efficiency. So instead of saying, these are the most valuable sources of information, let's use AI to tag the sentiment in the recordings that we make with our most valuable stakeholders and let's analyze them for trends, ideas, things that need to change. We don't do that. What we do is we're gonna give every call agent two minutes to get them off the phone. For God's sake, don't ask them any difficult questions. Don't spend money talking to the customer. Try to make them happy so they get a score and say they'd hire you at the end of the call and then you're done. So where the AI information needs to come in is not in improving efficiency, but in mining value. And the real opportunity with AI is that, and Joe Pine says this, if you are able to understand a customer rather than interpret them, that is so valuable to the customer that they will pay money for that. And I think that's where the whole focus needs to be in this new team, in enterprise IT and digital in the business. Some great observations. I think we can all relate to that in your call center example, or you've been at a restaurant and trying to turn the tables fast and get you out of there. And it's the last time you ever go to that restaurant. And you're taking that notion of systems thinking and broadening it to ecosystems thinking. And you've said ecosystems have a better chance of success when they're used to stage an experience for whether it's the employee, for the brand. And of course, the customer and the partners. That's it. That's exactly it. So every technology leader should be asking themselves, what contribution can I and my organization make to this movement? Because the business understands the problem. They don't understand how to solve it. And we've chosen a different dialogue. So we've been talking a lot about what cloud can do and the functionality that cloud has and the potential that cloud has. And those are all good things, but it really comes together now when we work together and we as the technology group brings in the know-how. We know how to connect quickly through the public cloud. We know how to do that in a secure way. We know how to manage data liquidity at scale. And we can stand these things up through our new learning of agile endeavors. We can stand these ecosystems up fairly quickly. Now, there's still a whole bunch of culture between different businesses that have to work together. The idea that I have to protect my data rather than serve the customer. But once you get past that, there's a whole new conversation that Enterprise IT can have that I think gives them a new lease of life, new value. And I just think it's a really, really exciting time. Yeah, so you're seeing the intersection of a lot of different things. You talk about cloud as an enabler for sure. And that's great, we can talk about that. But you've got this, what you were referring to before is maybe you're in a niche market, but you have your marketplace. And like you're saying, you can actually use that through an ecosystem to really lever a much, much broader available market and then vector that into the experience economy. We talk about subscriptions, the API economy, that really is new thinking. It is, and I think what you're seeing here is it's not radical in as much as all of these ideas have been around. Some of them have been around since the 90s. But what's radical is the way in which we can now mix and match these technologies to make this happen. That's gone so quickly. And I would argue to you, and I've argued this before, scale, scale as a concept within an organization is dead. It doesn't give you enough value. It gives you enough efficiency and it gives you a cloud. It doesn't give you the opportunity to target the niche experiences that you need to do. So if we start to think of an organization as a combination of known and unknown potential ecosystems, you start to build a different operating model, a different architectural idea. You start to look outside more than you start to look inside, which is why the cultural change that we were talking about just now goes hand in hand with this because people have to be comfortable thinking in ecosystems that may not yet exist and partnering with people where they bring to the table their 20, 30 years of experience in a new and different way. So make sure I understand that. So you basically, if I understand it, you're saying that if your sort of end goal is scale and efficiency at scale, you're going to have a vanilla solution for your customers and your ecosystem. Whereas if you allow this outside in thinking to come in, you're going to be able to actually customize those experiences and get the value of scale and efficiency. Right. So, I mean, Rory Sutherland, who is a big thinker in the marketing world, has always said, ultimately scale, standardization and best practice lead to mediocrity because you are not focused on the most important thing for your employee or your brand you're focused on the efficiency factors and they create very little value. In fact, we know that they subvert value. So, yes, we need to have a very big mindset change. Yeah, you're a top-line thinker, Alan, and always at the forefront. I really appreciate you coming on to the cube and participating in this program. Give us a last word. So if you're a change agent, I'm an organization and I want to inject this type of change. Where do I start? Well, I think it starts by identifying, are we going to work on the employee experience? Do we feel that we have a model where the employees that are on stage with customers are so important that the focus has to be employees? We go down that route and we look at what's happened to the pandemic, what type of experiences are we going to bring to those employees around their ability to have flow in their work to get return? Our energy to excite the customers. Let's do that. Let's figure out what experience are we driving now and what does that experience need to be? If we're the customer side, as I said, let's look at all the sources of information that we already have. I know companies that spend hundreds of millions a year trying to figure out what consumers want. And yet, if we look in their call centers, you will call up and they will say to you, your call may be recorded for quality purposes and training. And it's not true. Less than 10% of those calls are ever listened to. And if they are listened to, it's compliance that's driving that, not the burning desire to better understand the consumer. So if we change that, then we say, okay, so what can we change? What is the experience that we are now able to stage with all we know and with all we can do? And let's start there. Let's start with what is the experience you want to stage? What's the experience landscape look like? And who do we bring together to make that happen? Alan, fantastic having you back in theCUBE. It's always a pleasure. And thanks so much for participating. Thank you, Dave. It's always a pleasure to speak with you. And thank you, everybody. This is Dave Vellante. theCUBE on cloud will be right back right after this short break. Stay with us.