With shiny objects involving artificial intelligence (AI), blockchain, and the internet of things (IoT) coming onto the market every day, it is easy for executive committees to let the technology tail wag the business dog. At Campbell Soup Company, CIO Francisco Fraga preempts this unhappy fate by making “business relevance” the foundation for all technology initiatives.
Martha Heller: What does “digital transformation” mean to Campbell?
Francisco Fraga: For Campbell, it is very clear: Digital transformation is about leveraging IT in four ways:
Optimize our internal operations.
Empower our employees to be more efficient and effective; exceed their technology needs and make their IT experiences easy.
Integrate our ecosystem of employees, partners, suppliers, and customers.
Engage our consumers.
These highly business-relevant areas cannot stand on thin air; they all rely on a digital foundation, which includes an agile IT architecture that is resilient, secure, and cost effective. We have migrated most of our applications to the cloud, including our ERP, which runs completely in a public cloud.
Our data warehousing and most of our critical business applications now have a middleware layer to enable API integration, which replaces a ton of point-to-point interfaces that were expensive and hard to support. We are also adopting a software-defined WAN that will improve efficiency and cost of ownership.
With that digital foundation in place, what are some examples of initiatives in the four business-relevant areas?
For operations optimization, our focus has been on multifunctional processes. We see that the biggest opportunities exist in the seams of multiple functions working together in an end-to-end process. For example, we’ve been digitizing our product innovation process, which involves finance, supply chain, marketing, and R&D. Here, we’re leveraging the power of data and analytics to help inform and improve our product innovation process. In addition, one of our key priorities is data analytics that help us make better and faster decisions.
On employee empowerment, we are transforming work processes to take advantage of technology investments we’ve already made. We were an early adopter of Office 365, and we continue working to fully maximize the value of that investment to improve our employees’ user experiences in their day-to-day jobs.
In terms of our integrated ecosystem, we have a complex value chain. It depends on the correct integration of multiple business partners who help Campbell deliver the food and beverages you have in your kitchen. Here, we asked ourselves: How do we maximize the information we exchange for win-win opportunities, and we realized that we needed frictionless integration. So, we are leveraging APIs to exchange information that enables our end-to-end operations to work in synchrony, based on actual consumer demand. This seamless integration enables us to optimize the value chain across all partners.
With consumer engagement, our goal is to leverage the power of digital to understand our consumers better so that we more effectively make food and beverages that meet their needs. While we are early on in this journey, we know exactly where we are headed and are excited about the possibilities.
Who is driving this digital transformation?
After joining Campbell in August 2017, we started having internal and external conversations about digital strategy, and we quickly realized becoming digital was not the goal. Instead, digital transformation is one of many capabilities necessary to deliver our corporate strategy. To be successful, IT must lead our digital transformation. That is our role.
How are you communicating the vision behind the transformation?
We are connecting the dots for people. We are showing how our digital technology investments link directly to our business strategy. If the IT team cannot make that connection, we probably have it wrong.
What organizational and IT operating model changes have you made to drive your strategy?
It has been quite an exciting journey. Our first move was to change the way we were organized, which was by business unit. Now, we are organized by global services that are critical to our key stakeholders. The model is like the well-known “product-based structure,” but because we are a CPG company, and “product” means a bag of Goldfish or a can of Chunky® soup, we use the word “service” instead.
Some services are vertical and in line with a business domain — supply chain, finance and R&D, for example. Others are horizontal, such as data analytics and information security. We also committed to having an IT person at the table for every function and division, to ensure that IT is in sync with our business partners’ plans and strategies.
This new structure allows us to find opportunities for change across functions. For example, when we look at our hire-to-retire process, the vertical HR IT services team might need services from the data analytics or information security teams, but the HR IT services team is accountable for digitizing the hire-to-retire process in partnership with our HR colleagues.
What is the new culture you are building in the IT organization and how are you doing it?
Our IT culture is business relevance, so we focus on:
Anticipating business needs: We stay focused on where the business is headed and what the business needs to get there.
Being relentless about business value: All our investments and activity in IT must be measurable for distinctive business value.
We bring the outside in: Some of the most innovative ideas are not being created within Campbell IT; they are being developed by start-up companies and in other industries. We need to stay connected to that ecosystem, identify those ideas, and apply them to our situation/business.
Leveraging existing technologies: Our job is to leverage technologies that we own — or exist in the market — to drive business breakthroughs. We don’t need to invent the next blockchain technology.
Being masters of business processes and technology: If we are only good at finance, we should be in finance. If we are only good at technology, we should be at an IT provider. But to drive our digital transformation, we must be experts both in the technology and the business processes we support.
Operate with excellence: We must execute with quality, agility and speed. When facing an IT issue, we must resolve it to root cause, quickly and efficiently.
What advice do you have for CEOs who are embarking on a digital transformation?
Understand that digital is a means to an end. What is the goal you are trying to pursue? Can you clearly articulate the vision for your company and the goals necessary to achieve it? If you cannot, there is no technology that will get you there. You will chase shiny objects and not get any closer to value.
Once you can articulate that vision, ask yourself: What are the capabilities we need to be successful? Do we have them in house? If not, do we develop, acquire, or rent them?
Is your organization ready to absorb the amount of change necessary to achieve the vision? In my own organization, we are always enhancing our elasticity, but elastic can break. That’s how I think about change. Are we bringing so much change that we will hit a breaking point? If we are getting close, we have to manage it proactively.
What is one piece of advice you have for CIOs on transformational leadership?
Invest the time to educate all your constituents on what is relevant for your business, and you will begin to see momentum build. It will energize your team and align your organization to realize the benefits digital transformation provides.
About Francisco Fraga
Francisco Fraga is CIO with Campbell Soup Company. Previously, he had been vice president of IT for Procter & Gamble, where he had been employed more than 21 years. Fraga has a bachelor of science degree in computer engineering from Universidad Simon Bolivar in Venezuela.
Martha Heller is CEO of Heller Search Associates, an IT executive recruiting firm specializing in CIO, CTO, CISO and senior technology roles in all industries. She is the author The CIO Paradox: Battling the Contradictions of IT Leadership and Be the Business: CIOs in the New Era of IT. To join the IT career conversation, subscribe to The Heller Report.