Digital Transformation, a Way To Rethink Products and Services - Dover Corporation SVP Chief Digital

Thanks for hosting me.

That's a good question right. It has become a bit of a marketing password unfortunately, but I'll give you my perspective. So to me, digital transformation is one of the few core value creation levers in the hand of a CEO of a company, okay. What I mean by that is there are few ways in a large company you can create step function changes in a business, in its profitability, in its growth. There are multiple levers for it. They're not that many that have an impact or a potential impact across the board to improve the bottom line and the top line. Digital is one of them. That's the simplest way to put it. Digital transformation, unlike use of technology or use of information technology for operating day-to-day business, is a way of rethinking products, services, the go to market, the operations, or sometimes combinations of those in a way that you can create an exponential outcome. So I'll give you an example through my own journey. Right, so Dover Corporation is a fascinating, diverse industrial manufacturing company. We build a range of sophisticated industrial products across our five segments. We sell not just the products, we sell consumables and parts with it. And to make these products work, we also in many cases have embedded electronic software, etc., that is manufactured and created internally at Dover. We also sometimes do our own tooling and we have proprietary manufacturing processes, and we do it on the back of a very diverse worldwide workforce that is highly talented. So what does digital transformation mean to Dover and therefore how I as CDO think about it? So in my view, at a company like this, digital transformation has three key areas to impact business. The first one is to identify areas where our physical products and our go to market provides us the ability to create new digital solutions, which may be connected products or it may be separate digital solutions that offer new value to our existing customers and be able to sell them through our existing go to market channels. So this particular usage of digital transformation is about creating net new revenue streams and driving growth higher, okay. The second one in a company like ours, we look at it as digital transformation of our sales and marketing, of our go to market function. Okay, industrial company, I've had a very traditional go to market historically. The technology innovations that have happened more recently, if you think about 3D immersive experiences, artificial intelligence, augmented and mixed reality, these are the areas which are very highly beneficial to the manufacturing go to market function. Okay, so we are able to, one of the digital transformation initiatives on our side is how do we use and harness the power of these technologies to improve our customers' experience with us while at the same time reducing the cost of sale by making the customer get a better experience by themselves, by being able to observe and experience the product without having to, you know, call and talk to five or ten people, which is very traditional in a manufacturing company, right. And then finally, the third lever is around automation, like you mentioned earlier, but automation combined with cyber security. Okay, so cyber threats have grown exponentially over the last several years, and manufacturing companies have had their fair share of cyber threats. So as we drive automation of processes, we also have to at the same time tighten our systems, reduce the attack surfaces, reduce the factory attack surfaces as well as the carpet area attack surfaces, and do it in a way that the company doesn't only perform more efficiently, it also performs more securely. So those are the three areas the way I define digital transformation for a company like Dover.

Yeah, I think again, there's some very good couple of questions. So let me explain this. So digital transformation matters first for the reason that I just described, which is it's one of the levers for exponential outcome, right. But that's just one of the reasons. The second is the consumer expectations have changed, especially in the last four or five years. And if you couple that with the tremendous transformation in consumer expectation driven by necessity due to COVID, these elements have driven an expectation that I can get what I need to get where I need to get in a predictable fashion and based on a really rich experience, right. You and I experience that as a user of Amazon or some other product, but the same experiences that we experience as a consumer, we take it to our workplace, right, and as a B2B buyer or a B2B customer, we are now expecting those experiences. Also with the Gen Z's and Millennials coming into workplace, that is their normal life. I mean, they are used to having this kind of capability in place, and they're fairly shocked sometimes coming through some traditional environments that have not digitized and wondering why things take so long sometimes. So one is consumer expectation driving customer expectation change, right. And the second reason digital transformation matters is it's one of the few levers in the hands of CEO to do exponential change. Now coming back to why speed matters: see, digital transformation is not a cost-free exercise. It takes investments. Investments means there are investors behind it, whether those are public shareholders or they are private investors. In either case, there is an expectation of a time window for returns, right. And it is really important that the transformation be broken down into innings where each inning's outcome can be measured so that you can move on to the next higher level after delivering value from one. That is just a fundamental return on investment mindset that any CDO function needs to have because capital, when it's invested, expects a return. So that's why speed matters. Typical time windows of a digitization journey, you know, preferably it's no more than 24 months in each inning, so that you can constantly continue to increase the level of digitization in the business but deliver value against the investment in that time period before you move to the next one.

Thanks, I appreciate you hosting me. It was a great conversation. Thanks, bye.