Lately, when I am gathering requirements from CEOs about their CIO search, they tell me, “We are also thinking about hiring a chief digital officer. What is the division of responsibilities between the CIO and the CDO?” The answer is all over the map these days, so when I learned that Donagh Herlihy, former CIO of Avon, was playing both roles at Bloomin’ Brands, I asked him for an interview.
When were you made EVP of Digital and CIO at Bloomin’ Brands?
When I was interviewing for the CIO role, we talked about the shifting world of restaurant technology, and how companies are trying to differentiate through digital. We talked about how marketing, technology and store operations have to work together to create and deploy digital solutions to deliver a great customer experience. And while collaboration between these groups is critical, we all felt that we needed one member of the executive leadership team to be on the hook for ensuring we had a holistic strategy, roadmap, and investment plan. As I had provided oversight to digital marketing and e-commerce at Avon, the team at Bloomin’ Brands felt it was appropriate that I take on that role. It was critical for me that both the CEO and the CMO wanted that to happen and were comfortable with how I would go about the role.
What is your charter as head of digital?
Our mission in digital is to create digital solutions that drive traffic to our restaurants, that increase our customers’ satisfaction with their experience in the restaurant, and that facilitate a lasting relationship between our customers and our brands. We are always asking ourselves how can we increase consumer convenience, how can we give our customers greater choice and control over their experience? To answer those questions we need deep insights into the customer’s experience and pain points. Through focus groups, observation, surveys, data mapping how they use and leave our web sites, our apps, and our other solutions. It’s a data driven discipline.
Let me give a small example of the work. We have a portfolio of four brands, three of them are casual dining. Casual dining restaurants do not take reservations, so on a busy night customers may arrive at the restaurant and have to wait for a table. But if a customer has to wait too long, that weighs on their overall satisfaction and they might not come back. When you build out the customer journey map and study the cycle from planning the meal to arriving at the restaurant, sitting down, waiting for the food, eating and then waiting to pay, there are a lot of opportunities for frustrating wait-time built into the whole cycle. So one focus for digital is to put control over wait time in the hands of the consumer. We developed a solution to expose real time wait times for each restaurant on our website and mobile apps to allow customers put their name on the list and then arrive at the restaurant when a table is likely to be ready. We call this “Click thru Seating” and it has been hugely successful. It’s about providing transparency and being respectful of your customer’s time.
How are you organizing your IT and digital teams?
The genesis of the digital group was a blend of tech savvy marketers and consumer oriented technology folks, a small team of about a dozen. We have evolved the team so that it incorporates specialists from user experience design, digital analytics, product management as well as store operations. It is now truly cross functional. When I took on the digital group, I wanted to keep the team as a separate and distinct organization and not embed it within IT. The ability to attract great marketing, operations, analytics talent relies to an extent on the team having a distinct identity and culture. I didn’t want to lose either culture by putting them together.
While I kept digital separate I also made changes in IT. In order to increase the pace of solution delivery, I created a consumer technology team within the IT organization. They are the engineering partners to the digital team. So while the digital team is doing the research, strategy, product management and analytics, the consumer technology group is building and running those technologies. That technology group understand the need for minimal viable product, agile development, and the need to move fast and test and learn. The two groups are like fraternal twins, close but distinct.
What advice do you have for CIOs who would like to move into digital leadership?
Understand the customer: When I go to chief digital officer conferences, I find that about 10 percent have a background in IT, some are from e-commerce operations, some are from consulting, some from strategy, some from marketing. There is no one ideal background, because the role is trans-functional. The challenge for CIOs is if they have only been seen doing traditional internal technology work, then their desire for the digital leadership opportunity may not align with how their peers perceive them.
If you are CIO and you want the digital leadership role, you need to start to play in the consumer space. Get out with your end customers, understand how to better fulfill their needs and grow your revenue. Also build a real trusted relationship with your CMO and the marketing function. I became a CIO more than 15 years ago when IT and marketing did not have a natural relationship. IT grew up with finance and supply chain and operations, while marketing went to their agencies for technology solutions. A CIO’s relationship with marketing takes work. If as CIO, you are not credible with marketing and close to the customer, it will be tough to move into a digital leadership role. Your executive committee has to be thinking, “This person has a real understanding of the customer and has revenue generating ideas.”
Ask for it: The digital role is possibly a transitory role as we figure out how operations, technology and marketing can collaborate around this new digitally demanding customer. So we’ve introduced this fourth role among the three to pull it together. In a few years, we may not need a chief digital officer, just a more collaborative CMO, CIO, and head of operations. So, it is a great time for CIOs to put their hands up and ask for an assignment in digital. “Let me take on something outside of technology; let me lead a customer-facing team and show you what I can do.”
Embrace product management: Product management is different in digital than in IT. In IT your business partners need to define their requirements. In digital you don’t have that luxury, you need to define requirements yourself, based on deep consumer insight. You need to make decisions with imperfect information and test and learn based on the response from your customers to your solutions. So you need to surround yourself with product managers and strong digital analytics people, so your solutions are grounded in consumer needs and when you put a new solution out there, you can quickly read how consumers are responding to them. You also need to study the competition. You have to get out of your office and use your competitor’s products. You must use their apps, join their loyalty programs, and go into their stores. You need to walk in the digital consumer’s shoes.
About Donagh Herlihy
Donagh Herlihy is Executive Vice President Digital and Chief Information Officer for Bloomin’ Brands, where he oversees global strategy, development and implementation of all IT and digital consumer initiatives for the company. Donagh joined Bloomin’ Brands in September of 2014, and has more than 25 years of IT management experience in a variety of industries. Previously, he was CIO and SVP, IT and eCommerce with Avon Products, Inc., as well as CIO for the Wrigley Company prior to joining Avon. Donagh has a BSC in Industrial Engineering and an MA from the Institute of Technology and Trinity College in Dublin, Ireland.
About Bloomin’ Brands
Bloomin’ Brands, Inc. is a company of restaurants whose brands include Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar, and were founded by people who have a genuine passion for food and a desire to share hospitality with others. Headquartered in Tampa, Florida, Bloomin’ Brands, Inc. is one of the world's largest casual dining companies with more than $4.4 billion in sales in 2014, approximately 95,000 employees, and more than 1,500 restaurants throughout 48 states, Puerto Rico, Guam and 21 countries.