Category Archives: Predictive Analytics

Top Ten Digitalist Magazine Posts Of The Week [April 24, 2017]

the future of supplier collaboration 9 things cpos want managers to know now blog 300x200 Top Ten Digitalist Magazine Posts Of The Week [April 24, 2017]As a sourcing or procurement manager, you may think there’s nothing new about supplier collaboration. Your chief procurement officer (CPO) most likely disagrees.
Forward-thinking CPOs acknowledge the benefit of supplier partnerships. They not only value collaboration, but require a revolution in how their buying organization conducts its business and operations. “Procurement must start looking to suppliers for inspiration and new capability, stop prescribing specifications and start tapping into the expertise of suppliers,” writes David Rae in Procurement Leaders. The CEO expects it of your CPO, and your CPO expects it of you. For sourcing managers, this can be a lot of pressure.

Here are nine things your CPO wants you to know about how supplier collaboration is changing – and why it matters to your company’s future and your own future.

1. The need for supplier collaboration in procurement is greater than ever

Over half (65%) of procurement practitioners say procurement at their company is becoming more collaborative with suppliers, according to The Future of Procurement, Making Collaboration Pay Off, by Oxford Economics. Why? Because the pace of business has increased exponentially, and businesses must be able to respond to new market demands with agility and innovation. In this climate, buyers are relying on suppliers more than ever before. And buyers aren’t collaborating with suppliers merely as providers of materials and goods, but as strategic partners that can help create products that are competitive differentiators.

Supplier collaboration itself isn’t new. What’s new is that it’s taken on a much greater urgency and importance.

2. You’re probably not realizing the full collective power of your supplier relationships

Supplier collaboration has always been a function of maintaining a delicate balance between demand and supply. For the most part, the primary focus of the supplier relationship is ensuring the right materials are available at the right time and location. However, sourcing managers with a narrow focus on delivery are missing out on one of the greatest advantages of forging collaborative supplier partnerships: an opportunity to drive synergies that are otherwise perceived as impossible within the confines of the business. The game-changer is when you drive those synergies with thousands, not hundreds of suppliers. Look at the Apple Store as a prime example of collaboration en masse. Without the apps, the iPhone is just another ordinary phone!

3. Collaboration comes in more than one flavor

Suppliers don’t just collaborate with you to provide a critical component or service. They also work with your engineers to help ensure costs are optimized from the buyer’s perspective as well as the supplier’s side. They may even take over the provisioning of an entire end-to-end solution. Or co-design with your R&D team through joint research and development. These forms of collaboration aren’t new, but they are becoming more common and more critical. And they are becoming more impactful, because once you start extending any of these collaboration models to more and more suppliers, your capabilities as a business increase by orders of magnitude. If one good supplier can enable your company to build its brand, expand its reach, and establish its position as a market leader – imagine what’s possible when you work collaboratively with hundreds or thousands of suppliers.

4. Keeping product sustainability top of mind pays off

Facing increasing demand for sustainable products and production, companies are relying on suppliers to answer this new market requirement.

As a sourcing manager, you may need to go outside your comfort zone to think about new, innovative ways to collaborate for achieving sustainability. Recently, I heard from an acquaintance who is a CPO of a leading services company. His organization is currently collaborating with one of the largest suppliers in the world to adhere to regulatory mandates and consumer demand for “lean and green” lightbulbs. Although this approach was interesting to me, what really struck me was his observation on how this co-innovation with the supplier is spawning cost and resource optimization and the delivery of competitive products. As reported by Andrew Winston in The Harvard Business Review, Target and Walmart partnered to launch the Personal Care Sustainability Summit last year. So even competitors are collaborating with each other and with their suppliers in the name of sustainability.

5. Co-marketing is a win-win

Look at your list of suppliers. Does anyone have a brand that is bigger than your company’s? Believe it or not, almost all of us do. So why not seize the opportunity to raise your and your supplier’s brand profile in the marketplace?

Take Intel, for example. The laptop you’re working on right now may very well have an “Intel inside” sticker on it. That’s co-marketing at work. Consistently ranked as one of the world’s top 100 most valuable brands by Millward Brown Optimor, this largest supplier of microprocessors is world-renowned for its technology and innovation. For many companies that buy supplies from Intel, the decision to co-market is a strategic approach to convey that the product is reliable and provides real value for their computing needs.

6. Suppliers get to choose their customers, too

Increased competition for high-performing suppliers is changing the way procurement operates, say 58% of procurement executives in the Oxford Economics study. Buyers have a responsibility to the supplier – and to their CEO – to be a customer of choice. When the economy is going well, you might be able to dictate the supplier’s goods and services – and sometimes even the service delivery model. When times get tough (and they can very quickly), suppliers will typically reevaluate your organization’s needs to see whether they can continue service in a fiscally responsible manner. To secure suppliers’ attention in favorable and challenging economic conditions, your organization should establish collaborative and mutually productive partnerships with them.

7. Suppliers can help simplify operations

Cost optimization will always be one of your performance metrics; however, that is only one small part of the entire puzzle. What will help your organization get noticed is leveraging the supplier relationship to innovate new and better ways of managing the product line and operating the business while balancing risk and cost optimization. Ask yourself: Which functions are no longer needed? Can they be outsourced to a supplier that can perform them better? What can be automated?

8. Suppliers have a better grasp of your sourcing categories than you do

Understand your category like never before so that your organization can realize the full potential of its supplier investments while delivering products that are consistent and of high quality. How? By leveraging the wisdom of your suppliers. To be blunt: they know more than you do. Tap into that knowledge to gain a solid understanding of the product, market category, suppliers’ capabilities, and shifting dynamics in the industry, If a buyer does not understand these areas deeply, no amount of collaboration will empower a supplier to help your company innovate as well as optimize costs and resources.

9. Remember that there’s something in it for you as well

All of us want to do strategic, impactful work. Sourcing managers with aspirations of becoming CPOs should move beyond writing contracts and pushing PO requests by building strategic procurement skill sets. For example, a working knowledge in analytics allows you to choose suppliers that can shape the market and help a product succeed – and can catch the eye of the senior leadership team.

Sundar Kamak is global vice president of solutions marketing at Ariba, an SAP company.

For more on supplier collaboration, read Making Collaboration Pay Off, part of a series on the Future of Procurement, by Oxford Economics.

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EnterCard Moves Fraud Protection to the Cloud

EnterCard EnterCard Moves Fraud Protection to the Cloud

In another sign of the growing use of the cloud for fraud protection, EnterCard — one of the leading Scandinavian finance companies — will use the FICO® Falcon® Platform to combat card fraud and communicate with its 1.7 million customers.

EnterCard is upgrading to a cloud-based version of Falcon to protect customers in Sweden, Norway and Denmark from fraud.

“The cloud-based version of Falcon gives us greater flexibility to serve our customers with better fraud protection,” said Yannick Leclerc, head of fraud in EnterCard Group. “We will have greater control over how we communicate with customers when fraud is suspected, which will help us improve the customer journey in a fraud context.”

For more information, read our news release.

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6 Ways To Retain Women In Corporate Ranks

280785 GettyImages 533980355 super low 1 6 Ways To Retain Women In Corporate Ranks

We’ve got a crisis of competitiveness right under our noses, and heaven knows we’re not making enough progress to solve it.

I’m talking about our inability as a collective workforce to retain women as they rise up the ranks in corporate America (or actually as they don’t rise up the ranks). Here are the sobering facts: only 14% of executive suites in America are occupied by a female. Even in companies as broadly recognized as best-in-class for retaining women (companies like Abbott, Ernst & Young, and KPMG), only 23% of the top floor hosts top women.

So other than for the purposes of easing male guilt, is there really any reason to get serious about solving this?

You bet your company’s assets there is.

Research is irrefutably clear that the presence of women in the workforce improves productivity, innovation, team dynamics, decision-making processes, organization health, and the bottom line. Research also indicates women are just better leaders. An extensive study by Jack Zenger and Joseph Folkman indicates women scored better than men on 15 of 16 core leadership competencies as rated by their peers.

So, yeah, it’s kind of important we get this right.

Based on research and a robust passion for this topic, here are six ways we can help make progress toward the critical issue of retaining women in the corporate ranks.

1. Ask yourself: “Opted out” or “pushed out”?

So I’m going to go right after it – the unconscious bias toward women in the workplace is undeniable, and perhaps no more obvious than in the case of mothers in the workforce. A Vanderbilt study showed women with Bachelor’s degrees from highly selective universities that were married with children were 20% less likely to work than women in the same group who did not have children.

Far too often the surrounding assumption is women such as these are choosing to opt out to focus on their families. But the reality is that many feel pushed out because they did not feel supported by their company and felt they had no choice but to leave. We simply cannot allow “baby penalties” to pervade the workplace.

What follows lays out the ways we can help mothers (and women in general) in the workforce to feel and be better supported. But it starts with a gut check on whether we are fully embracing the status of “mother.”

2. Fuel flexibility

Sociologist Pamela Stone found 90% of women she interviewed in her research cited inflexible working conditions and long hours as the reasons they left their employers. Many tried to work part time but found that “hours creep, marginalization, stigmatization, and career plateauing (or being passed over for promotion) made part-time work undesirable.”

Her research also found many inconsistencies between policies on flexibility and the actual application of those policies. And missing the chance to execute flexible work options in a well-thought-through manner means whiffing on the opportunity to fill a huge unmet need. A major “women in the workplace” survey showed “75% of college-educated women aged 35 to 60 would rather have more free time in their lives than make more money at their jobs. In fact, 40% would even take a pay cut for more flexibility.” So review your workplace practices through a lens of flexibility and work-life balance and flex to what needs to change.

3. Flush out gender bias

So there’s that bias word again. Beth Axelrod, head of HR at eBay, speaks to the importance of recognizing gender bias when it’s happening to prevent unfairness in areas as critical as the promotion process. Says Axelrod, “Women might think, ‘I don’t advocate for myself as aggressively as men do.’ ‘I don’t raise my hand for a job, because I trust my manager to put me forward if I’m a suitable candidate.’ ‘I don’t hammer my manager to promote me, because that would be self-promoting – even though some of my male colleagues do that.’ And, ‘I don’t speak up in meetings as much as many of my male colleagues.’ Women want to know that the people processes for assessments, promotions, and job placements are fair and that those processes take note of subtle differences between the way men and women shepherd their careers.” And by the way, assuming that these female behavioral tendencies equal a lack of ambition is a massively misplaced assumption.

4. Provide clear and crucible career opportunities

You probably didn’t need research to confirm this, but in fact research shows “employers are simply not providing mid-career women with the opportunities that would increase their likelihood of staying in the workforce.” Perhaps more so than for any other strategy for improving female retention, providing pivotal career opportunities requires intentionality.

Dare to plan two to three assignments out. Even if you know things could change and no guarantees can be made that far in the future, just having the discussion can really help. Take a stand and be a champion to get talented women in jet-fuel roles. Conduct proactive “stay interviews” instead of the dreaded, and too-late, exit interview. The key is to do clear, purposeful, energizing career mapping. This is particularly important to do well in advance of women entering and exiting their maternity leaves.

5. Have a “role model action plan”

I don’t care what you’re trying to accomplish in life, it’s much more difficult to get there when you can’t look to and learn from those who have gone before you. With so few female role models in the upper ranks, it becomes a vicious cycle – not enough women to help pull, not enough inspiration to help push.

So as leaders, we need to have a very intentional, long-term action plan for how we can place more female role models in visible, important positions. Hold your team and yourself accountable to achieving this goal – make it a success metric. Encourage formal and informal women’s networks to help facilitate “productive commiseration” and to provide exposure to those precious few role models. The important point here is to roll up your sleeves and get a plan to have role models in place. Now.

6. Champion change for family friendly benefits

For many readers of this article, you may not feel you are in a place to influence company policy on benefits. But that shouldn’t stop you from starting the conversation.  It’s important not to underestimate the impact such “base” subjects as benefits can have on female retention. For example, in Sweden, where children are provided a spot in a public preschool and parents are charged no more than three percent of their incomes for the care, 78% of mothers work (compared to the low 60s in the U.S.).

Again, while it may seem like impacting such policies is “not your square,” I have seen vivid examples in Fortune 500 behemoths where policy changes started with a passionate individual who put real tension on the issue.

I don’t have the market cornered on the know-how here, but I’d love it if this piece fueled more conversation. If you have ideas on how to retain more women in the workforce, please share them in the comments.

Even unintentional bias can cost companies significantly, so make sure to learn How to Avoid the Most Dangerous Barrier to Good Decision Making.

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Marketing To An Audience Of One: Personalizing My Flavor Profile

The business world is now firmly in the age of data. Not that data wasn’t relevant before; it was just nowhere close to the speed and volume that’s available to us today. Businesses are buckling under the deluge of petabytes, exabytes, and zettabytes. Within these bytes lie valuable information on customer behavior, key business insights, and revenue generation. However, all that data is practically useless for businesses without the ability to identify the right data. Plus, if they don’t have the talent and resources to capture the right data, organize it, dissect it, draw actionable insights from it and, finally, deliver those insights in a meaningful way, their data initiatives will fail.

Rise of the CDO

Companies of all sizes can easily find themselves drowning in data generated from websites, landing pages, social streams, emails, text messages, and many other sources. Additionally, there is data in their own repositories. With so much data at their disposal, companies are under mounting pressure to utilize it to generate insights. These insights are critical because they can (and should) drive the overall business strategy and help companies make better business decisions. To leverage the power of data analytics, businesses need more “top-management muscle” specialized in the field of data science. This specialized field has lead to the creation of roles like Chief Data Officer (CDO).

In addition, with more companies undertaking digital transformations, there’s greater impetus for the C-suite to make data-driven decisions. The CDO helps make data-driven decisions and also develops a digital business strategy around those decisions. As data grows at an unstoppable rate, becoming an inseparable part of key business functions, we will see the CDO act as a bridge between other C-suite execs.

Data skills an emerging business necessity

So far, only large enterprises with bigger data mining and management needs maintain in-house solutions. These in-house teams and technologies handle the growing sets of diverse and dispersed data. Others work with third-party service providers to develop and execute their big data strategies.

As the amount of data grows, the need to mine it for insights becomes a key business requirement. For both large and small businesses, data-centric roles will experience endless upward mobility. These roles include data anlysts and scientists. There is going to be a huge opportunity for critical thinkers to turn their analytical skills into rapidly growing roles in the field of data science. In fact, data skills are now a prized qualification for titles like IT project managers and computer systems analysts.

Forbes cited the McKinsey Global Institute’s prediction that by 2018 there could be a massive shortage of data-skilled professionals. This indicates a disruption at the demand-supply level with the needs for data skills at an all-time high. With an increasing number of companies adopting big data strategies, salaries for data jobs are going through the roof. This is turning the position into a highly coveted one.

According to Harvard Professor Gary King, “There is a big data revolution. The big data revolution is that now we can do something with the data.” The big problem is that most enterprises don’t know what to do with data. Data professionals are helping businesses figure that out. So if you’re casting about for where to apply your skills and want to take advantage of one of the best career paths in the job market today, focus on data science.

I’m compensated by University of Phoenix for this blog. As always, all thoughts and opinions are my own.

For more insight on our increasingly connected future, see The $ 19 Trillion Question: Are You Undervaluing The Internet Of Things?

The post Data Analysts and Scientists More Important Than Ever For the Enterprise appeared first on Millennial CEO.

 Marketing To An Audience Of One: Personalizing My Flavor Profile

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Behavioral Analytics Attack Fraud, Cyber and Financial Crime

Analytics Hand Behavioral Analytics Attack Fraud, Cyber and Financial Crime

Economies of scale is one of my favorite economic principles. It’s especially cool to see how FICO customers can realize associated benefits by using our behavioral analytic technology.

IDC predicts that in 2017, behavioral analytics across compliance, fraud, and cyber detection and prevention will be in place at 15% of banks, helping them to avoid losses, regulatory fines and sanctions.

Banks have already made a big start in the fraud space. FICO introduced behavioral analytics in the early 1990s and we currently analyze two-thirds of the world’s payment card transactions, in real time, for fraud.

Now, FICO’s proven behavioral analytics can be applied by forward-thinking institutions to fight a wide range of financial crimes. In doing so, banks can gain powerful technology economies of scale, too, leveraging mature, market-proven analytic models to benefit new domains within their business.

How do behavioral analytics work?  

A quick search may tell you that “behavioral analytics” measure the behavior of consumers on ecommerce platforms, online games, web and mobile applications or Internet of Things (IoT) devices. In fact, “behavioral analytics,” from a pure data science point of view, help us to understand much more:

  1. what an individual person or device does, and
  2. what they don’t do, but might in the future.

The first comparison is of the customer or device in the context of their own history of events, where one can determine changes from historical behaviors. A second comparison is done by grouping customers or devices into similar clusters, and then analyzing how much the behaviors of individuals deviate from their associated groups.

Depending on the degree of variance, we can assess how likely the behavior is to be aberrant and thus potentially fraudulent or criminal — or, in the case of a network device, how likely that endpoint is to have been compromised by a cyber attacker.

Power at scale: Enhancing fraud, compliance and cyber security defenses 

Behavioral analytics are a mature technology in fraud prevention. Behavioral analytics technology allows us to flag potentially fraudulent transactions with pinpoint accuracy, greatly reducing the volume of “false positives,” or transactions flagged as potentially fraudulent that are, in fact, legitimate. FICO has honed its fraud detection technology to identify the needles in the haystack.

In terms of compliance — particularly anti-money laundering (AML) and terrorism financing — the most prevalent transaction monitoring solutions used to identify illicit activity in these domains are extremely imprecise. The compliance solutions generate tens of thousands of alerts for every genuinely criminal transaction requiring a formal suspicious activity report (SAR). The volume is so great that that compliance officers can only investigate a small fraction of suspected SARs. As a result, illegal transactions slip through, continuing through the global payments system.

It’s the same situation with cybersecurity. In any security operations center, there’s a cacophony of alarms, 24-7. It’s impossible for operators to tell which alarms are calling out truly meaningful intrusions, and which are just noise. That’s why so many cyber attacks go undetected for weeks, months or even years.

FICO solutions for compliance and cybersecurity address these shortcomings, dramatically improving the accuracy of AML detection and enabling real-time discovery of cyber threats.

Benefits beyond cost savings

As IDC noted, behavioral analytics technology can help financial institutions to avoid regulatory fines and sanctions. The benefits extend farther: in terms of fraud and compliance, behavioral analytics will allow more illicit transactions to be stopped as they occur, saving untold amounts of financial and reputational loss.

With regard to cybersecurity, the ability to pinpoint cyber attacks more quickly greatly reduces the “dwell time” of malware, ransomware and other malicious code that causes data breaches and other damage. Again, this can significantly reduce the costs of remediation that result from breaches, as well as major financial and reputational losses.

Want to know more? Check out my latest FICO Hot Topic Q&A, “Behavioral Analytics: Boosting Protection across Fraud, Compliance and Cybersecurity.” Follow me on Twitter, too, @ScottZoldi to keep up with my latest analytics rants, raves and musings.

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Fueling Growth With Knowledge-Driven Collaboration At Sargent & Lundy

Generation Z’s arrival in the workforce means some changes are on the horizon for recruiters. This cohort, born roughly from the mid-90s to approximately 2010, will be entering the workforce in four What Gen Z’s Arrival in the Workforce Means For Recruiters 740x431 300x175 Fueling Growth With Knowledge Driven Collaboration At Sargent & Lundyshort years, and you can bet recruiters and employers are already paying close attention to them.

This past fall, the first group of Gen Z youth began entering university. As Boomers continue to work well past traditional retirement age, four or five years from now, we’ll have an American workplace comprised of five generations.

Marketers and researchers have been obsessed with Millennials for over a decade; they are the most studied generation in history, and at 80 million strong they are an economic force to be reckoned with. HR pros have also been focused on all things related to attracting, motivating, mentoring, and retaining Millennials and now, once Gen Z is part of the workforce, recruiters will have to shift gears and also learn to work with this new, lesser-known generation. What are the important points they’ll need to know?

Northeastern University led the way with an extensive survey on Gen Z in late 2014 that included 16- through 19-year-olds and shed some light on key traits. Here are a few points from that study that recruiters should pay special attention to:

  • In general, the Generation Z cohort tends to be comprised of self-starters who have a strong desire to be autonomous. 63% of them report that they want colleges to teach them about being an entrepreneur.
  • 42% expect to be self-employed later in life, and this percentage was higher among minorities.
  • Despite the high cost of higher education, 81% of Generation Z members surveyed believe going to college is extremely important.
  • Generation Z has a lot of anxiety around debt, not only student loan debt, and they report they are very interested in being well-educated about finances.
  • Interpersonal interaction is highly important to Gen Z; just as Millennials before them, communicating via technology, including social media, is far less valuable to them than face-to-face communication.

Of course Gen Z is still very young, and their opinions as they relate to future employment may well change. For example, reality is that only 6.6% of the American workforce is self-employed, making it likely that only a small percentage of those expecting to be self-employed will be as well. The future in that respect is uncertain, and this group has a lot of learning to do and experiences yet ahead of them. However, when it comes to recruiting them, here are some things that might be helpful.

Generation Z is constantly connected

Like Millennials, Gen Z is a cohort of digital natives; they have had technology and the many forms of communication that affords since birth. They are used to instant access to information and, like their older Gen Y counterparts, they are continually processing information. Like Millennials, they prefer to solve their own problems, and will turn to YouTube or other video platforms for tutorials and to troubleshoot before asking for help. They also place great value on the reviews of their peers.

For recruiters, that means being ready to communicate on a wide variety of platforms on a continual basis. In order to recruit the top talent, you will have to be as connected as they are. You’ll need to keep up with their preferred networks, which will likely always be changing, and you’ll need to be transparent about what you want, as this generation is just as skeptical of marketing as the previous one.

Flexible schedules will continue to grow in importance

With the growth of part-time and contract workers, Gen Z will more than likely assume the same attitude their Millennial predecessors did when it comes to career expectations; they will not expect to remain with the same company for more than a few years. Flexible schedules will be a big part of their world as they move farther away from the traditional 9-to-5 job structure as work becomes more about life and less about work, and they’ll likely take on a variety of part time roles.

This preference for flexible work schedules means that business will happen outside of traditional work hours, and recruiters’ own work hours will, therefore, have to be just as flexible as their Gen Z targets’ schedule are. Companies will also have to examine what are in many cases decades old policies on acceptable work hours and business norms as they seek to not only attract, but to hire and retain this workforce with wholly different preferences than the ones that came before them. In many instances this is already happening, but I believe we will see this continue to evolve in the coming years.

Echoing the silent generation

Unlike Millennials, Gen Z came of age during difficult economic times; older Millennials were raised in the boom years. As Alex Williams points out in his recent New York Times piece, there’s an argument to be made thatGeneration Z is similar in attitude to the Silent Generation, growing up in a time of recession means they are more pragmatic and skeptical than their slightly older peers.

So how will this impact their behavior and desires as job candidates? Most of them are the product of Gen X parents, and stability will likely be very important to them. They may be both hard-working and fiscally savvy.

Sparks & Honey, in their much quoted slideshare on Gen Z, puts the number of high-schooler students who felt pressured by their parents to get jobs at 55 percent. Income and earning your keep are likely to be a big motivation for GenZ. Due to the recession, they also share the experience of living in multi-generational households, which may help considerably as they navigate a workplace comprised of several generations.

We don’t have all the answers

With its youngest members not yet in double digits, Gen Z is still maturing. There is obviously still a lot that we don’t know. This generation may have the opposite experience from the Millennials before them, where the older members experienced the booming economy, with some even getting a career foothold, before the collapse in 2008. Gen Z’s younger members may get to see a resurgent economy as they make their way out of college. Those younger members are still forming their personalities and views of the world; we would be presumptuous to think we have all of the answers already.

Generational analysis is part research, but also part theory testing. What we do know is that this second generation of digital natives, with its adaption of technology and comfort with the fast-paced changing world, will leave its mark on the American workforce as it makes its way in. As a result, everything about HR will change, in a big way. I wrote a post for my Forbes column recently where I said, “To recruit in this environment is like being part wizard, part astronaut, part diplomat, part guidance counselor,” and that’s very true.

As someone who loves change, I believe there has never been a more exciting time to be immersed in both the HR and the technology space. How do you feel about what’s on the horizon as it relates to the future of work and the impending arrival of Generation Z? I’d love to hear your thoughts.

Social tools are playing an increasingly important role in the workplace, especially for younger workers. Learn more: Adopting Social Software For Workforce Collaboration [Video].

The post What Gen Z’s Arrival In The Workforce Means For Recruiters appeared first on TalentCulture.

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What Happens When CHROs Make It To The Boardroom

277357 l srgb s gl 300x200 What Happens When CHROs Make It To The Boardroom“Innovation distinguishes between a leader and a follower.” – Steve Jobs

As a part of the last wave of Millennials joining the workforce, I have been inspired by Jobs’ definition of innovation. For years, Millennials like me have been told that we need to be faster, better, and smarter than our peers. With this thought in mind and the endless possibilities of the Internet, it’s easy to see that the digital economy is here, and it is defining my generation.

Lately we’ve all read articles proclaiming that “the digital economy and the economy are becoming one in the same. The lines are being blurred.” While this may be true, Millennials do not see this distinction. To us, it’s just the economy. Everything we do happens in the abstract digital economy – we shop digitally, get our news digitally, communicate digitally, and we take pictures digitally. In fact, the things that we don’t do digitally are few and far between.

Millennial disruption: How to get our attention in the digital economy

In this fast-moving, highly technical era, innovation and technology are ubiquitous, forcing companies to deliver immediate value to consumers. This principle is ingrained in us – it’s stark reality. One day, a brand is a world leader, promising incredible change. Then just a few weeks later, it disappears. Millennials view leaders of the emerging (digital) economy as scrappy, agile, and comfortable making decisions that disrupt the norm, and that may or may not pan out.

What does it take to earn the attention of Millennials? Here are three things you should consider:

1. Millennials appreciate innovations that reinvent product delivery and service to make life better and simpler.

Uber, Vimeo, ASOS, and Apple are some of the most successful disruptors in the current digital economy. Why? They took an already mature market and used technology to make valuable connections with their Millennial customers. These companies did not invent a new product – they reinvented the way business is done within the economy. They knew what their consumers wanted before they realized it.

Millennials thrive on these companies. In fact, we seek them out and expect them to create rapid, digital changes to our daily lives. We want to use the products they developed. We adapt quickly to the changes powered by their new ideas or technologies. With that being said, it’s not astonishing that Millennials feel the need to connect regularly and digitally.

2. It’s not technology that captures us – it’s the simplicity that technology enables.

Recently, McKinsey & Company revealed that “CEOs expect 15%–50% of their companies’ future earnings to come from disruptive technology.” Considering this statistic, it may come as a surprise to these executives that buzzwords – including cloud, diversity, innovation, the Internet of Things, and future of work – does not resonate with us. Sure, we were raised on these terms, but it’s such a part of our culture that we do not think about it. We expect companies to deeply embed this technology now.

What we really crave is technology-enabled simplicity in every aspect of our lives. If something is too complicated to navigate, most of us stop using the product. And why not? It does not add value if we cannot use it immediately.

Many experts claim that this is unique to Millennials, but it truly isn’t. It might just be more obvious and prevalent with us. Some might translate our never-ending desire for simplicity into laziness. Yet striving to make daily activities simpler with the use of technology has been seen throughout history. Millennials just happen to be the first generation to be completely reliant on technology, simplicity, and digitally powered “personal” connections.

3. Millennials keep an eye on where and how the next technology revolution will begin.

Within the next few years Millennials will be the largest generation in the workforce. As a result, the onslaught of coverage on the evolution of technology will most likely be phased out. While the history of technology is significant for our predecessors, this not an overly important story for Millennials because we have not seen the technology evolution ourselves. For us, the digital revolution is a fact of life.

Companies like SAP, Amazon, and Apple did not invent the wheel. Rather, they were able to create a new digital future. For a company to be successful, senior leaders must demonstrate a talent for R&D genius as well as fortune-telling. They need to develop easy-to-use, brilliantly designed products, market them effectively to the masses, and maintain their product elite. It’s not easy, but the companies that upend an entire industry are successfully balancing these tasks.

Disruption can happen anywhere and at any time. Get ready!

Across every industry, big players are threatened — not only by well-known competitors, but by small teams sitting in a garage drafting new ideas that could turn the market upside down. In reality, anyone, anywhere, at any time can cause disruption and bring an idea to life.

Take my employer SAP, for example. With the creation of SAP S/4HANA, we are disrupting the tech market as we help our customers engage in digital transformation. By removing data warehousing and enabling real-time operations, companies are reimagining their future. Organizations such as La Trobe University, the NFL, and Adidas have made it easy to understand and conceptualize the effects using data in real time. But only time will tell whether Millennials will ever realize how much disruption was needed to get where we are today.

Find out how SAP Services & Support you can minimize the impact of disruption and maximize the success of your business. Read SAP S/4HANA customer success stories, visit the SAP Services HUB, or visit the customer testimonial page on SAP.com.

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Deliver Service Unleashed: Giving Your Customers Your All

unleashed 768x304 Deliver Service Unleashed: Giving Your Customers Your All

In Seth Godin’s recent TEDxYouth talk, “Stop Stealing Dreams,” he asked his audience to raise their right hand as high as they could. After a room full of people reached for the sky, he added, “Now, raise your hand a little higher!” Without exception, every hand in the room was raised higher. They had all held back a little, just in case a bit more might be later requested. But what if no one held back, or to take the analogy a step further, what if we delivered service to those we serve – colleagues, customers, clients, family members – that is completely unleashed from the start?

For example, we needed a large bear-proof crate that would hold a garbage can at our river home in the North Georgia mountains. Black bears are not particularly dangerous unless protecting a cub; they are just always hungry. In the spring and summer, they roam the river bank at night behind our house in search of garbage cans with an inviting aroma. Even though we chained the large can to the wall, they still crushed it from the top to forage for any tasty contents, leaving our backyard littered with garbage.

We called Bill Lorraine. Bill is a master carpenter who had added a sunroom onto the river side of our house. When a neighbor came over to inspect the finished national park style crate he commented, “Now, this is one serious crate. Why? Because even an elephant couldn’t have his way with it. But, why Bill for a small project like this?”

Our answer was: “Bill’s really, really good…he is a carpenter unleashed.”

Have a pep talk with your leashed attitude

“When people ask me ‘how do you make it in show business?’” says famed actor and comedian Steve Martin, “What I always tell them – and nobody ever takes note of it [because] it’s not the answer they wanted to hear. What they want to hear is, ‘here’s how you get an agent, here’s how you write a script, here’s how you do this…’ But I always say: ‘Be so good they can’t ignore you.’ If somebody’s thinking, ‘How can I be really good?’ people are going to come to you. It’s much easier doing it that way than going to cocktail parties.”

Service unleashed is all about being really, really good. It means customers experiencing you raising your hand as high as you can – right out of the blocks. The pursuit of excellence says to your colleagues and customers, “You are so important to me that you get my absolute best.” “Being really, really good” includes service with an attitude – an unmistakable disposition of passion and confidence.

Deliver service unleashed by paying attention to the details that, improperly maintained and managed, can spell mediocrity. It means staying on top of the subtle signals colleagues or customers experience that might disappoint. It involves thinking beyond your customer’s needs to their unspoken aspirations. And, it encompasses ensuring customers witness internal service – colleague to colleague – that matches the same standard of distinction.

Take respect to the top for your customer

Two things I remember about my very first suit. It was a powder blue suit—perfect for Easter Sunday church dress-up. And it was a “big boy” event. I was seven years old. Joseph Neel’s Men’s Wear in Macon, Georgia, was a two-hour drive from my rural hometown and we visited only every August to buy school clothes. But this purchase required a special spring journey.

The “big boy” event started with the salesperson person pulling up a chair in front of me at my eye level. He shook my hand and introduced himself by his first name, not “Mr.” Without a single glance at my dad, he asked me about my favorite color. Then he asked for my second favorite color. He asked me about my hobbies and wanted to know my best friend’s name. We were pals in a matter of minutes.

I walked out of the store very tall because I had a suit in my favorite color, a white dress shirt, a pair of shoes, and a tie in my second favorite color. Did I mention that I was seven?

Respectful service – experiences filled with admiration – starts and ends with a clear and present devotion for customers. It is affirmation laced with authenticity. It is confident deference without a hint of servitude. And it is born out of enormous pride in one’s role and workmanship manifested as a kind of invitation to the experience.

It is as if the server says, “Come witness and experience my excellent work, crafted just for you.” It is like a “random act of kindness,” only when you deliver service that is respectful, it is not random; it is perpetual.

And always deliver service that is first class

My business partner and I were working with a client in Nicaragua. One evening we elected to skip the hotel grill and try the hotel’s upscale restaurant – Factory Steak and Lobster. We were in for a special treat. So I ordered my usual Jack Daniels whiskey on the rocks. In every restaurant in America, this request would yield a highball glass brought to the table already filled with ice plus the special adult beverage ready to drink. Because of that practice, I have sometimes gotten cheap bourbon poorly disguised as Jack, as well as a drink the bartender apparently measured with a thimble instead of a jigger.

But at the Real Metrocentro InterContinental in Managua, I was not served Jack Daniels. It was presented to me! The waiter brought a tray containing a full bottle of Jack, an empty chilled glass, a container of ice, and a tall shot glass. The glass was then filled with ice – one cube at a time, and placed before me. The bottle was presented much like a wine steward might present a chosen bottle of wine. Then, assuming approval, the Tennessee whiskey was poured into the shot glass. Finally, lovingly poured into the ice-filled highball glass! A simple shot of whiskey was treated like pricey Dom Perignon champagne. That’s how you deliver service that resonates.

Then make it magical!

What if you found a way to make the mundane magical? What if every service moment was treated as an extraordinary event for a cherished customer? The check-in hotel clerk would come from behind the desk to give you your room key. The taxi driver would take your luggage all the way into the hotel lobby. The service tech would explain your auto repair kneeling eye level with you as you sat comfortably.

Customers are not interested in being treated as royalty served by a slave. But, they do notice when the service they receive clearly indicates they are treasured. If your customers gave your service a letter grade, what grade would you get? What steps can you take to make an A+ on your next customer report card? Deliver service that is the best you have, and their best will come back to you.

For more on customer engagement, see 5 Steps to Your Customer’s Heart with Emotionally Aware Computing.

“Service Unleashed” is the copyrighted name of a suite of new customer service training programs designed by Chip Bell and co-owned and delivered by Forrest Performance Group (fpg.com).

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Examining the Credit Cycle: Is This as Good as it Gets?

More than 70 straight months of US job growth, the official unemployment rate down below 5%, and average hourly earnings growing at a seven-year high of 2.9%. Signs of approaching full employment finally allowed the Fed to see enough stability to inch up rates without being seemingly blown off course by events elsewhere. There will be more rate hikes to come if the economy stays on this course, and in the event the deficits grow, it will pretty much guarantee what we already expect on the interest rate front.

With all this in mind, it’s a good time to ask: Has the US credit cycle reached the bottom? Is it as good as it gets?

Of course, we never know that for sure. This is all opinion (some would say speculation), especially on the economic policy front. But you have to feel that if it isn’t the bottom we are not far off.

Take a look at delinquency stats.

Credit Cycle Delinquency Rates Chart Examining the Credit Cycle: Is This as Good as it Gets?

All of these figures are based on a two-year outcome. Thus, the scoring date for the October 2016 figures would be October 2014.

The most interesting observation is the uptick in origination delinquencies, which we see across the board relative to 2013. Compare that to the broader population, where we see the generally benign to improving economic environment continues to push down rates. (Originations here are trades opened within six months of the scoring date.)

Of course, these figures don’t allow us to separate deterioration from laxer credit standards. It’s fair to say that the latter almost certainly is a key contributor.

In the major product categories, the picture is mixed. At least at the top level, the lid still seems to be on the mortgage market, where delinquency rates remain low. In the card and auto worlds, rates are still a long way below the dark days of 2008 but are up among younger borrowers.

Do YOU think today’s credit cycle is as good as it gets? I invite you to make your case in our comments section.

The truth is that we will only know when we look back and say “I told you so!” For now, the signs suggest we are near that point, and we should keep our eye firmly on the horizon to understand which way this is headed.

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Social Media In Insurance Marketing Today

As 2015 winds down, it’s time to look forward to 2016 and explore the social media and content marketing trends that will impact marketing strategies over the next 15 months or so.

Some of the upcoming trends simply indicate an intensification of current trends, however others indicate that there are new things that will have a big impact in 2016.

Take a look at a few trends that should definitely factor in your planning for 2016.

1. SEO will focus more on social media platforms and less on search engines

Clearly Google is going nowhere. In fact, in 2016 Google’s word will still essentially be law when it comes to search engine optimization.

However, in 2016 there will be some changes in SEO. Many of these changes will be due to the fact that users are increasingly searching for products and services directly from websites such as Facebook, Pinterest, and YouTube.

There are two reasons for this shift in customer habits:

  • Customers are relying more and more on customer comments, feedback, and reviews before making purchasing decisions. This means that they are most likely to search directly on platforms where they can find that information.
  • Customers who are seeking information about products and services feel that video- and image-based content is more trustworthy.

2. The need to optimize for mobile and touchscreens will intensify

Consumers are using their mobile devices and tablets for the following tasks at a sharply increasing rate:

  • Sending and receiving emails and messages
  • Making purchases
  • Researching products and services
  • Watching videos
  • Reading or writing reviews and comments
  • Obtaining driving directions and using navigation apps
  • Visiting news and entertainment websites
  • Using social media

Most marketers would be hard-pressed to look at this list and see any case for continuing to avoid mobile and touchscreen optimization. Yet, for some reason many companies still see mobile optimization as something that is nice to do, but not urgent.

This lack of a sense of urgency seemingly ignores the fact that more than 80% of the highest growing group of consumers indicate that it is highly important that retailers provide mobile apps that work well. According to the same study, nearly 90% of Millennials believe that there are a large number of websites that have not done a very good job of optimizing for mobile.

3. Content marketing will move to edgier social media platforms

Platforms such as Instagram and Snapchat weren’t considered to be valid targets for mainstream content marketing efforts until now.

This is because they were considered to be too unproven and too “on the fringe” to warrant the time and marketing budget investments, when platforms such as Facebook and YouTube were so popular and had proven track records when it came to content marketing opportunity and success.

However, now that Instagram is enjoying such tremendous growth, and is opening up advertising opportunities to businesses beyond its brand partners, it (along with other platforms) will be seen as more and more viable in 2016.

4. Facebook will remain a strong player, but the demographic of the average user will age

In 2016, Facebook will likely remain the flagship social media website when it comes to sharing and promoting content, engaging with customers, and increasing Internet recognition.

However, it will become less and less possible to ignore the fact that younger consumers are moving away from the platform as their primary source of online social interaction and content consumption. Some companies may be able to maintain status quo for 2016 without feeling any negative impacts.

However, others may need to rethink their content marketing strategies for 2016 to take these shifts into account. Depending on their branding and the products or services that they offer, some companies may be able to profit from these changes by customizing the content that they promote on Facebook for an older demographic.

5. Content production must reflect quality and variety

  • Both B2B and B2C buyers value video based content over text based content.
  • While some curated content is a good thing, consumers believe that custom content is an indication that a company wishes to create a relationship with them.
  • The great majority of these same consumers report that customized content is useful for them.
  • B2B customers prefer learning about products and services through content as opposed to paid advertising.
  • Consumers believe that videos are more trustworthy forms of content than text.

Here is a great infographic depicting the importance of video in content marketing efforts:
small business video infographic Social Media In Insurance Marketing Today

A final, very important thing to note when considering content trends for 2016 is the decreasing value of the keyword as a way of optimizing content. In fact, in an effort to crack down on keyword stuffing, Google’s optimization rules have been updated to to kick offending sites out of prime SERP positions.

6. Oculus Rift will create significant changes in customer engagement

Oculus Rift is not likely to offer much to marketers in 2016. After all, it isn’t expected to ship to consumers until the first quarter. However, what Oculus Rift will do is influence the decisions that marketers make when it comes to creating customer interaction.

For example, companies that have not yet embraced storytelling may want to make 2016 the year that they do just that, because later in 2016 Oculus Rift may be the platform that their competitors will be using to tell stories while giving consumers a 360-degree vantage point.

For a deeper dive on engaging with customers through storytelling, see Brand Storytelling: Where Humanity Takes Center Stage.

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