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 Cofounder of Salsa AI, distributing AI to the masses. 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 email@example.com
Avoiding the falsification of medicines with blockchain
Counterfeit medicines are a problem around the world, with many producers of false medicines attempting to illegitimate drugs from pharmaceutical companies. Blockchain could be the answer to stem the tide and the U.S. FDA are interested.
Concerns with falsified medicines extend to where drugs which are targeted at those who are seriously ill. These types of medicines may be contaminated or they can contain the wrong ingredient or no active ingredient at all. Alternatively, the drugs may have the right active ingredient but at the wrong dose. In other words, such medicines may harm the patient or exert no beneficial effect at all.
The rise in counterfeit medicines is linked to a general increase in the number of people using the Internet to purchase commodities and this includes those using the Internet to self-diagnose and self-prescribe. This practice can lead to people purchasing ineffective medicines; medicines that normally require a prescription; or purchasing what they think are legitimate medicines but which are in fact fake.
For many years regulators, such as the U.S. Food and Drug Administration (FDA), Health Canada and the European Medicines Agency have taken measures to prevent counterfeit medicines from entering the drug supply chain. One such example of a practice designed to reduce counterfeiting is by implementing product serialization. Serialization requires a comprehensive system to track and trace the passage of prescription drugs through the entire supply chain.
An alternative could be based on blockchain. “Blocks” on the blockchain are made up of digital pieces of information, which store information about transactions, say the date, time, and transaction price. Blocks also store information about who is participating in transactions, and information that distinguishes the block from other blocks. The system is designed to provide transparency and security.
In theory, with a pharmaceutical blockchain it would be impossible to tamper with a medicine or to swap legitimate medicines with fake medicines. In addition, someone purchasing a medicine would be able to assess where the medicine came from (that is, did it come from a bona fide manufacturer?)
It is for this reason that the U.S. FDA is examining the potential for blockchain, as Engadget reports. The federal agency has begun a pilot program that enables the drug supply chain explore ways to track prescription medicine.
According to the FDA, blockchain will enable the “use of innovative and emerging approaches for enhanced tracing and verification of prescription drugs in the U.S. to ensure suspect and illegitimate products do not enter the supply chain.”
Pharmaceutical companies have until March 11, 2019 to apply. The pilot will not produce actionable results until 2023. In the meantime, more conventional methods for seeking to eliminate counterfeit medicines will have to suffice.
Big data analytics provides first world vegetation maps
Artificial intelligence and big data analytics have been applied to produce the first global map of the world’s regions where vegetation can and cannot be grown.
The Valencia University study assesses the global abundance of the phosphorus and nitrogen content in vegetation. Also assessed is the efficiency in water use. The scientists’ aim is to show where the best places are for agriculture and where environmental conditions are changing in response to climate change. The application of artificial intelligence and big data methodologies also enables an assessment to be made of our planet’s biodiversity.
Together with carbon, hydrogen, oxygen and sulfur, nitrogen and phosphorus are the principal chemical elements incorporated into living systems. They are strong signals of the suitability of different parts of the Earth for agriculture. Both nitrogen and phosphorus are needed by plants in large amounts (although excessive quantities can also cause environmental damage). In soil, nitrogen and phosphorus are typically found in the form of nitrates and phosphates.
The new global maps produced by the researchers gathered information from Google mass satellite observation data and then used a specially developed artificial intelligence program to assess the data and produce the color-coded maps. The satellites gathered temporal and spatial observations, and this produced a series of maps characterizing different biophysical parameters. To develop the maps required numerous observation-measurement pairings to be number crunched.
Speaking with Phys.org, lead researcher Álvaro Moreno explained why the maps were significant: “Until now, it was impossible to produce these maps because the required conditions weren’t available. We didn’t have powerful and accurate machine learning statistical tools, nor did we have access to great bodies of data or cloud computing.”
The new maps and the process behind them are published in the journal Remote Sensing, in a paper titled “Regional Crop Gross Primary Productivity and Yield Estimation Using Fused Landsat-MODIS Data” and an companion article in Remote Sensing of Environment titled “A methodology to derive global maps of leaf traits using remote sensing and climate data.”
The next steps are to use the technology to further assess the impact of climate change and to assess other important societal and ecological questions like the pressure on food production to meet population growth and the development of new technologies, like biofuel production.
Which innovations will shape Canadian industry in 2019?
Canada is in the midst of an economic shift. New and traditional industries are increasingly being driven by innovation and these advances in technology are shifting the economic landscape at an unprecedented pace.
This is the assessment by Borden Ladner Gervais, which is Canada’s largest law firm. The company has issued a new thought leadership report, titled “Top Innovative Industries Shaping the Canadian Economy”.
The report weighs in on the opportunities and risks Canada faces in order to maintain its status as an international leader in innovation across eight key industries: cybersecurity, the Internet of Things, smart cities, cryptocurrency and blockchain, autonomous vehicles, fintech, renewable energy and cannabis.
To find out more about the report and its implications for Canadian businesses, Digital Journal spoke with Andrew Harrison, a partner at BLG.
Digital Journal: Where does Canada stand as a global tech innovator?
Andrew Harrison: Canada has always been at the forefront of innovation. Products developed by Canadians or Canadian companies encompass a variety of industries and include medicinal insulin, the snowmobile, the telephone, the pager, BlackBerry Messaging, IMAX, the Canadarm and the goalie mask, to name a few. Canadians are also fast adopters of new technologies; email money transfer between individuals, which was inconceivable only a few years ago, has been used by 63 per cent of Canadians.
This is why Canada is recognized worldwide for its research and technological know-how, but we have to be mindful of the challenges in a global competitive market.
DJ: What potential does Canada have to grow faster? Is this sector specific?
Harrison: Canada is well positioned to succeed and take the lead in all innovative industries, but there are definitely sector-specific challenges that could limit this growth. For example, the lack of regulation as to whether cryptocurrencies are considered securities or not is creating uncertainty, which may restrain investment in this sector.
DJ: What are the risks that could hamper innovation and development?
Harrison: For any new product, financing is always an issue; with innovation, money becomes an even more crucial element. Companies must have access to capital – including from individual and institutional investors – if they want to bring their innovative product/process to life. Evolving politics and policies can also have a significant impact.
DJ: What framework will Canada need in the future to secure its innovation potential?
Harrison: The key element is finding a proper balance between regulating the issues that might be created by the innovation itself or its use and providing a space where innovations can thrive without too many restrictions.
DJ: What does the Canadian government need to do?
Harrison: In many cases, laws and regulations were enacted long before we saw these innovative technologies and products brought to life, so they need to be updated. In certain sectors, such as cryptocurrencies and autonomous vehicles, the Canadian government has yet to provide a framework that would define the playing rules for all participants.
The government will also need to take a look at its current regulations on privacy: the coming into force in May 2018 of the European General Data Protection Regulation (“GDPR”) and recent high-profile data breaches have created the need for stronger privacy guidelines. Failure to do so could prevent Canadian businesses from accessing the European market.
DJ: What can academia contribute?
Harrison: Universities play a big role in fostering innovation – they could be the home of research and innovation and incubators of ventures, entrepreneurs, and tech talent. Universities can partner with industry players and have their researchers work closely to solve key industry issues. This is already happening in Canada. The Smith School of Business and Scotiabank, for instance, have partnered to set up the Scotiabank Centre of Customer Analytics at Smith School of Business to bring together professors, graduate students and analytics practitioners to collaborate on applied research projects in customer analytics. The academia plays a big role in creating an innovation ecosystem.
DJ: What is Canada’s most pressing technological need?
Harrison: There is still much work to be done to connect with Canada’s rural and remote communities. In 2016, the Canadian Radio-television and Telecommunications Commission (CRTC) declared that broadband Internet amounted to an essential service and adopted minimal performance standards across Canada: 50 megabit per second download and 10 megabit per second upload. However, the evidence presented to the Committee by a variety of stakeholders shows that the digital divide remains prominent in Canada – it is estimated that it will take roughly 10 to 15 years for the remaining 18% of Canadians to reach those minimums. Canada needs to develop a comprehensive rural broadband strategy in partnership with key stakeholders and make funding more accessible for small providers.
DJ: What type of investment is needed with skills and training?
Harrison: Canada has a serious shortage of tech talent, which makes it imperative for both the government, the education, and the business sector to invest in raising and fostering STEM talents. To help businesses attract the talent they require, the federal government is offering hiring grants and wage subsidies to offset payroll costs for recent post-secondary STEM students and graduates.
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