Digital Disruption is commonplace these days. It occurs so frequently that when it happens it’s not as impressive as it once was. However, it’s an incessant reminder to the C-suite of many traditional organizations of the need to transform in order to keep pace with a market that is unpredictable and in an environment that is far from stable.
Alfredo C. Tan, the newly-minted Chief Digital and Innovation Officer at WestJet, has been tasked with driving this new direction for the Canadian airline as it moves to become a global success story. In just two decades, WestJet established more than 13,000 employees, over 100 destinations in North America, Central America, the Caribbean and Europe and an additional 175 destinations in over 20 countries through partnerships.
As with almost all industries, the global tourism and travel landscape has witnessed significant changes. This $7.6 trillion sector has seen a pronounced shift in its business model, in part because of disruptors like Airbnb and Uber. The airline industry will not be immune. Crippled by legacy operations and heavy regulation, the desire to transform is not a feat that is surmountable in a short period of time.
This 2017 report published by the Centre for Aviation acknowledged these changes:
Above any other industry, airlines are captured within an arcane regulatory framework designed 70 years ago, and whose purpose was to achieve little else than protect against new entry. It is a capital intensive heavily unionized industry, and it is dominated by legacy models still focused on buying and flying expensive metal. But at its heart the airline offering is just another consumer retail product. As such, it is just as susceptible to upheaval… The airline industry as we know it will be unrecognizable by 2025, as fundamental features are uprooted. The process will be accelerated because of the confluence of disruption in each of the key aspects of commercial aviation: flying and selling.
I had the pleasure of sitting down with Alfredo C. Tan to explore his journey to WestJet and his vision to instigate some necessary upheaval in an already accomplished organization.
Obsessed to Join the Movement to Empower the Internet Generation
Alfredo remembers Cisco Systems “Empowering the Internet Generation” commercials. The powerful message depicted a world transformed by this eventual connectivity across networks and markets. As a student of forensic science and biology at the time, he felt he had missed the opportunity to be part of this incredible wave of dot.com companies being born.
When he graduated, he read an article in Fortune Magazine about top business school graduates turning down blue chip companies to go chase the new Gold Rush in Silicon Valley. Not one to let another opportunity go by, Alfredo learned how to code and immersed himself in computer and technical courses. Soon he landed at Bell Nexia in Systems Engineering and Design where he eventually led a team of engineers to help restore connectivity between telcos in NYC and Toronto during the World Trade Centre disaster. Along the way, Alfredo had looked to mentors willing to teach him:
Most things in the professional world you can excel at without a formal education in that field. With enough mentorship, intellectual curiosity, aptitude, grit and passion you can find success almost anywhere.
Whether it was Bell Canada where he learned to build large scale strategic alliances, enterprise marketing and strategy, or at MSN.ca where he was introduced to the disruptive world of online advertising, media sales and internet marketing, or at Yahoo! Inc. working on Mobile, Search, and corporate partnerships, Alfredo’s journey exemplified this learning mantra throughout his career.
Facebook: The Platform that Changed Everything
If you could see the future and know within a decade your company has just entered the S&P500, you would not hesitate to join. In 2008, this was hardly evident, and Alfredo grappled with the decision to leave an amazing job with endless opportunities within a company that was still an internet powerhouse for a social network that was perceived to be overvalued, had no clear monetization strategy, no real market differentiator and one that could have easily gone by the wayside like MySpace or Friendster. The defining moment for him came when he returned from a trip in 2008. As he remembers,
Before I returned from a trip in 2007, I exchanged email addresses among those I had just met. And by the time I went on a trip in 2008, everyone exchanged ONLY Facebook IDs. Within 12 months the movement from email to Facebook was unreal. What Facebook was really building was identity at scale. What it really has is people – 2.2 billion people. And as it continues to grow, it continues to be unassailable.
He chose to venture to Facebook despite all the guidance and advice otherwise. He remained there for 8 years, where he spent the last two years working with the leadership teams in the high growth markets of South East Asia and Latin America. The learnings were life changing and career defining.
Why Can’t Traditional Businesses Adapt to Market Changes?
For all the gains Facebook and social networks have made globally, business has still not fully embraced the changes required to keep pace with the dynamic market.
Alfredo points to disruptors like Google, Netflix, Facebook, Microsoft, Uber, Apple and Amazon. These companies have a different way of building their innovation culture. What’s common among them?
- They move with a sense of urgency
- They worship velocity
- They are unafraid of change
This is a polarized view of how traditional companies operate.
As the Chief Digital and Innovation Officer of WestJet, Alfredo’s experiences make him ripe for the challenge ahead. WestJet recognizes the need for change and a culture that supports the changes required. As a traditional company, it behaves much differently than the environments Alfredo was used to. Coming from the tech space, there is a common understanding, a common way of thinking because technology isn’t something you need to convince people to invest in.
It’s hard-coded in the DNA of the company.
In most traditional companies digital is not foundational to the success of the company. Success comes from other practices within the organization. The challenge becomes convincing a group of people in a company to invest in what you believe to be true.
Alfredo would argue the majority of leaders and employees understand the world has dramatically changed but it’s not clear how digital could be a competitive advantage. There’s a process in education and winning the hearts and minds of people to “believe it before they see it”. The executives were sold on change as the new normal at WestJet. Alfredo was inspired by the genuine interest and motivation by the employees to make this a reality.
WestJet’s First Ever Hackathon
Thinking differently takes time. You can’t make the assumption that people understand simply by saying. Just as he continues to learn about an infinitely complex industry, Alfredo and his team, in turn, need to educate and tell the story in a way that helps the entire company understand the impact of digital and innovation on the business, without the jargon and without the hype.
This came to fruition soon enough. WestJet’s VP of Loyalty, d’Arcy Monaghan and Rhonda Reynolds, Product Development Manager, approached Alfredo about developing solutions for the premium traveler, which could then trickle down to all of WestJet’s guests. Alfredo had only been in the job a few weeks and didn’t feel he and his already-constrained team were in a position to solve the problem on their own.
While the original idea was to hold a brainstorm among a group of people from various departments, it quickly morphed to include some of Alfredo’s friends from the tech industry. As more people heard about it, the more they wanted to participate. The kernel grew into this idea of a full day hackathon, a competition to develop a seamless premium guest experience and #HackInTheHangar was born.
Alfredo invited some of the biggest tech companies and systems integrators like Adobe, Facebook, Amazon, Deloitte Digital, Google, Panasonic Avionics, Twitter, LinkedIn, Snapchat, Hootsuite, IBM, Salesforce, Huge Inc. In all, 17 companies and their 120 people from technical, creative and design backgrounds were paired with 37 WestJetters and a dozen of WestJet’s premium travelers to participate in this one-day event. As Alfredo points out:
The initial, very simple idea gave birth to this movement in the company which aimed to answer a few key questions:
- How can we show 13,000 people that we can solve problems in a different way and co-create new experiences?
- More importantly, at a greater velocity:
- How do we get non-technical people to solve problems in a hack culture?
- How do we gain the respect of the global tech community to be be inspired and partner with us in our digital and innovation mandate and co-create the future of travel?
- How do I win the support from key executives in the organization who I would need in order to succeed?
The judges for the event were chosen with care and purpose. The objective was to demonstrate the amazing thinking and solutions that were developed within one day, and to have them understand and evangelize Alfredo’s vision for the company.
The Digital Company that Just Happens to Fly Planes
By the end of the day, the executives at WestJet needed little convincing. Louis Saint-Cyr, the Vice President of Guest Experience indicated that airlines with legacy behaviors limit what they can do for the customer. The hackathon revealed WestJet’s need to align with what will be an increasingly digital guest journey. He validated the industry’s current push and pull between innovation and regulation which has produced operating limitations. Despite this, Louis saw huge possibilities:
This hackathon revealed how we can innovate around these structural limitations. How do we digitally empower the front lines and augment soft skills WestJetters are known for with technology to tailor guest experiences?
…Think of the hurdles that go into a customer’s travel journey: the time to get to the airport, the waiting times for bags, the check-in – things that can add stress. By leveraging the emotional framework of social media and aligning it to the guest journey, we can address these hurdles in a direct way to transform air travel for guests.
…Overall, by amalgamating guest profiles with their expectations to what they’re experiencing on board, on the website, and in the airport we can make significant strides in the guest experience.
CEO of WestJet, Ed Sims closed the day and declared that in 24 months, WestJet will be a digital company that happens to fly planes. It sent a signal to the tech community and the leadership team that this hackathon wasn’t just a side project; this will literally be the future of the company.
WestJet’s first hackathon represents a cultural shift toward more innovative thinking at WestJet. We will move fast, learn fast and build fast. We now have an opportunity to do things differently and to innovate in the travel space like has never been done before. Our goal is to have products way ahead of guests’ expectations.” ~Ed Sims, WestJet President and CEO
Alfredo’s next steps?
The hackathon and the thinking it surfaced are all theatre and theory until you start to build. We have to build the capabilities that we saw were compelling plus other capabilities we will investigate in the future. Innovation is a cultural mindset more than anything else but it comes from building.
These brilliant ideas will lay the groundwork for developing those capabilities over the next five years. In addition, given the incredible demand to repeat more events after the hackathon WestJet is planning to host an annual event with different themes.
In a short period, the acceptance the hackathon generated, instilled an idea to embed the hack culture into the company as a way of addressing problems and empowering cross-functional groups to self-organize and invent solutions in a confined period of time.
We’ll find a way to make it pervasive in the organization so a flight crew member who wants to fix a process can gather a group of people to create a solution then present that for budget approval in a matter of days. It’s bringing the hackathon to smaller scale, smaller team sizes, with less fanfare. Hopefully, that will influence 13,000 people to start to think this way.
We are just getting started… In the end, I would have failed in my job if I was the only one responsible for the digital and innovation culture. It’s for all WestJetters to embrace it and the future.
For someone whose mantra is to be curious and continue learning, Alfredo C. Tan, in the first 90 days, has pushed the organization to think differently, learn new ways of doing things, and challenge the limits of their imagination.
Hessie Jones is the Founder of ArCompany advocating AI readiness, education and the ethical distribution of AI. She is also Director for the International Council, Global Privacy and Security by Design. As a seasoned digital strategist, author, tech geek and data junkie, she has spent the last 18 years on the internet at Yahoo!, Aegis Media, CIBC, and Citi, as well as tech startups including Cerebri, OverlayTV and Jugnoo. Hessie saw things change rapidly when search and social started to change the game for advertising and decided to figure out the way new market dynamics would change corporate environments forever: in process, in culture and in mindset. She launched her own business, ArCompany in social intelligence, and now, AI readiness. Through the weekly think tank discussions her team curated, she surfaced the generational divide in this changing technology landscape across a multitude of topics. Hessie is also a regular contributor to Towards Data Science on Medium and Cognitive World publications.
This article solely represents my views and in no way reflects those of DXJournal. Please feel free to contact me firstname.lastname@example.org
Intel embraces DX at Data-Centric Innovation Day
Intel’s recent Data-Centric Innovation Day in San Francisco showed how the company is putting digital transformation at the forefront of its business strategy, to build a bridge from its former position as the big name in PC CPUs, toward a more agile future. In a competitive world of business technology startups and scaleups, Intel is putting its DX foot forward, and showing how the company’s own innovations can help its global customers to embrace the wins that comes with digital transformation.
While the event was a product launch for all intents and purposes, there was a bigger story going on at Data-Centric Innovation Day: the positioning of Intel as a data-centric enterprise and the company’s emphasis on collaboration with its customers around the world as they undertake digital transformation.
At the event’s outset, Intel CEO Robert Swan predicted that the company’s data-centric total addressable market will be 200 billion by 2022. As a continually growing number of organizations move to the cloud, and C-suites continue to look to AI and analytics to develop their competitive advantage, this kind of market growth for the IT giant seems reasonable.
At the core of Intel’s data-driven shift is the customer experience. As Swan stated at the event, Intel is looking to become ‘customer-obsessed’ through the company’s new focus on data. While the role of a processor or a new hardware product within enterprise organizations has not radically shifted — it remains just one piece within the larger technology structures powering digital transformation — Intel’s attitude around their hardware and software offerings, and how they play into the customer’s overall business technology experience, has certainly taken a big leap forward.
In a press release for the event, Navin Shenoy, Intel executive vice president and general manager of the Data Center Group, noted that the new technology was all about putting data first:
“Today’s announcements reflect Intel’s new data-centric strategy. The portfolio of products announced today underscores our unmatched ability to move, store and process data across the most demanding workloads from the data center to the edge. Our 2nd-Generation Xeon Scalable processor with built-in AI acceleration and support for the revolutionary Intel Optane DC persistent memory will unleash the next wave of growth for our customers.”
Intel unveiled a new range of products, including the next generation of Xeon Scalable Processors. The new Xeon line was designed with DX tasks in mind, and the processors look to aid Intel clients with AI processes, cloud and edge computing and with running rapidly growing workloads. The new processors feature DL Boost, a unique inference acceleration offering designed specifically for AI-heavy processes.
The technology giant also emphasized the security enhancements of the new range. VP of Digital Transformation at Intel, Lisa Davis, announced during the event that Intel has partnered with Lockheed Martin to create hardened, full-stack security solutions for CIOs and CESOs. Processing and moving more data than ever requires ever-evolving security, and Intel made a point of emphasizing their dedicating to this element of their new product line.
DX at the heart of Intel’s announcements
For an established tech company like Intel to take on data in such a massive way should be no surprise to digital transformation diehards. But for those still hesitant to take on data management as a bigger part of their organization, Intel’s focus on moving, storing and processing every bit of client data should act as a wakeup call for those still holding out when it comes to digital transformation efforts.
The shape that Intel’s technology is taking, as innovations like DL Boost and the cloud-centric nature of the company’s new security offerings show, is all about meeting the digital transformation needs of customers around the world.
“You can’t digitally transform as an organization if you’re focused on aging IT practices,” said Intel Canada’s Phil Vokins during an interview on the day of the event. “I think the one thing we’ve seen today which we should all be excited about is the range of capabilities and performance that we’re enabling, which was unthinkable even a couple of years ago. It’s not just about the performance of the processor, but look at the memory we can have per socket now. This will really enable businesses to take advantage of the information they have.”
Collaboration with partners and clients key
This focus on a holistic approach to data is not something Intel is doing on its own. The emphasis of Intel’s Data-Centric Innovation Day was so clearly on collaboration, with many major players in the IT and enterprise world contributing to the event. During his keynote, Shenoy was vocal about Intel’s broad set of partners and customers, emphasizing branching out and building a bigger business ecosystem.
Every technology showcased during the product launch was tied back to one of Intel’s global partners: AWS, Vodafone, Twitter, Microsoft, Alibaba, and other companies were featured and promoted through Intel’s own announcements. Featuring partners like this led to some very conversational panels on the nitty gritty of DX throughout the day’s events. But this collaborative approach to the technology also highlighted another aspect of Intel’s digital transformation journey.
Vokins said that, for Intel, the process of digital transformation is also a question of interpreting what’s happening in the world of business technology and turning that information into valuable insights to improve performance.
“We’re in a very fortunate position, given our market share, that we have huge amounts of information and resources and access to leading businesses. So we need to make sure that we can disseminate, understand and rearticulate that information back.”
Vokins emphasized the need to collaborate around each digital transformation insight, “so that we can all learn from it, and learn how customers are embracing technology to rapidly improve performance.”
How edge computing can boost business efficiency
Edge computing is about processing data as close to the source as possible, which reduces both latency and bandwidth use. This concept is seen as critical for furthering the Internet of Things and for driving the development of autonomous vehicles.
What is edge computing?
Edge computing is a decentralized approach to computing applied to networks (the opposite to cloud computing’s centralized approach). The concept relates to how a network stores its information. In edge computing, most data on a network is moved away from physical computers. For businesses, data is moved onto a private server.
Edge computing is especially useful in cases where a lot of data is generated. The approach allows for the successful triage of data locally so that some of it is processed locally, reducing the backhaul traffic to the central data repository. This is very useful in cases where many devices are connected together, as with the Internet of Things.
Edge computing helps to make the Industrial Internet of Things possible. This is an area of great value. McKinsey & Co. calculate that the Industrial Internet of Things will generate $7.5 trillion in value by 2025. The advantages here are to connect people to machine data that accelerate digital industrial transformation.
How can edge computing benefit business?
The advantages of edge computing are that it takes less time to move data and there are fewer are less hardware limitations and that hardware limitations are easily addressed. With conventional storage systems, hardware is normally required, and this can create a bottleneck that places a restriction on how much memory can be moved at any time point. The use of hardware also leads to slower data transfer speeds.
Furthermore, the costs of operating and maintaining the hardware are relatively more expensive.
Security is also stronger with edge computing, making edge computing systems harder for hackers to penetrate. This is because data is continually moving between network modes.
When data are moved throughout a network, they go through different security layers to ensure hackers cannot get into the system, but edge computing goes beyond this. More security layers are used because, instead of the data moving between the network nodes, the data moves from the Internet into the servers and onto the nodes. This provides an opportunity for creating additional firewalls and antivirus scans.
How are businesses using edge computing?
Businesses can derive many advantages from the edge computing concept. The edge process enables analytics and data gathering to occur at the source of the data. This enables companies to leverage resources from devices that are not necessarily continuously connected to a network like laptops, smartphones, tablets and sensors.
Autonomous vehicles and edge computing
Among the more specific examples is autonomous car technology. These are, in a sense, datacenters on wheels, and here edge computing plays a key role. To collect the high volumes of data, edge computing provides an advantage. In terms of data, Intel estimates that autonomous cars, with their many on-vehicle sensors, generate over 40 terabytes of data for each eight hours of driving. Given that this level of data cannot be easily sent to a cloud (and this also presents a safety risk in terms of delayed reactions), the use of edge computing becomes a necessity.
Security cameras and edge computing
A second example is with security systems. If a large complex is served by dozens of high-definition Internet of Things video cameras where data is continuously streaming that signal to a cloud server, these systems can be slow to respond. This is especially so if the security protocol is designed to respond to motion-detection. This set-up places a major strain on the building’s Internet infrastructure, with a high proportion of the bandwidth becoming consumed by a high volume of video footage.
With the edge concept, each camera would have an independent internal computer to run the motion-detecting application and then sent footage to the cloud server as needed. This improves efficiency and lowers bandwidth use.
Fleet management and edge computing
Edge computing also helps to improve the efficiency of fleet management. While a large volume of key performance data needs to be collected – wheels, brakes, battery, electrical – where such data requires a response, such as a potential brake failure, then some of this data needs to be collected and stored locally on the edge in order to minimize the risk of vehicle breakdown or accident.
An example of edge computing applied to fleet management is with trailer temperature. With most fleet monitoring systems, only temperature readings that are outside of a set range are reported back to fleet managers through telematics. The fleet manager then needs to assess whether or not there is a problem. However, with edge analytics, temperature readings can be analyzed onboard a vehicle and notified to the driver, empowering the driver to take steps to mitigate the temperature fluctuation.
VMware and AWS unleash hybrid cloud options in Canada
Cloud platforms are transforming the way organizations do business, and the competition between cloud providers is fierce. VMware and Amazon Web Services are partnering to provide cloud solutions to businesses in Canada.
At a roundtable in Toronto, data center company VMware, IT partner Scalar Decisions and AWS discussed how the new VMware Cloud on AWS service will open up new options for customers. The organizations hope that the new arrangement will act as a catalyst to get Canadian organizations, private and public, to the cloud.
Easing cloud migration for Canadian companies
The new offering from VMware and AWS looks to provide customers with powerful hybrid cloud options in order to help them benefit from AWS’ many capabilities. The new, on-demand service allows organizations working with VMware to extend, migrate and manage their cloud-based resources with the use of AWS services.
Sean Forkan, Vice President and Country Manager at VMware, stated that innovation in the public cloud is happening daily on a global scale, and thanks to VMware Cloud, Canadian companies can now benefit from these transformative shifts coming from within AWS.
The VMware Cloud service lives in the same region and availability as Amazon services, and is managed by VMware. Customers can be served both by AWS’ Montreal-based data centre or the U.S. data centre, depending on their data residency requirements. Over time both VMware and AWS hope to see a greater merger of the tools.
Peter Near, National Director of Solutions Engineering with VMware Canada, said that the transition to cloud services for businesses is not just a question of efficiency, but global performance. And while the majority of data sets on Canadian databases are not easy to migrate, Near predicted that the new offering from VMware and AWS provides these companies an ‘easy button’ for migration.
Transition to cloud has never been more popular
In a recent survey by multi-cloud management company RightScale, 95 percent of respondents said they are using cloud in some way. Hybrid and public cloud were far and away the most popular amongst adopters, with 85 percent of surveyed businesses citing some kind of hybrid cloud strategy, while only 10 percent of respondents cited the use of a single public cloud.
As Eric Gales, Director of AWS Canada, said during the roundtable, “It used to be that owning and operating infrastructure was an advantage.” According to Gales, eliminating the ownership and operation of costly infrastructure is at the heart of the pronounced increase in cloud adoption in Canada.
Gales noted that artificial intelligence and machine learning are also driving organizations towards the scalability and on-demand talent of public cloud services. AI and ML need a lot of computing, said Gales, and now VMware can use existing apps and workloads through AWS to accelerate and amplify the use of these apps. In terms of talent required to scale AI and ML tools, this could be a boon for medium-sized businesses, as the “surface area of new things they need to develop skills for or learn is lower,” said Gales.
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