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June 2, 2021 | 29 Mins Read
<br><em>Howard Bowland, VP Field Services Australia at Schneider Electric and Scott Weller, Partner at Mossrake, talk with Sarah about how various industries are adopting as-a-service models, Schneider’s introduction of its as-a-service value proposition, and how critical your go-to-market is in this journey.</em></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><em>Click on the link for more information on Schneider Electric’s innovative aaS offer EcoStruxure Outcomes: Secure Power as a Service - <a href="http://www.se.com/au/outcomes">www.se.com/au/outcomes</a></em></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Welcome to the Future of Field Service podcast. I'm your host Sarah Nicastro. Today, I'm talking with Schneider Electric, and talking to them about their journey to delivering outcomes. I'm joined today by Howard Bowland, vice president of field services Australia for Schneider Electric, and Scott Weller, who is a Mossrake partner. Howard and Scott, welcome to the Future of Field Service podcast.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Thanks, Sarah.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro: </strong>Thank you for joining me. We have a really cool story to talk through today and share some insights on how Schneider in Australia has really not only embraced but made some significant strides in the journey to outcomes-based service. Before we dig into the topic at hand, let's just start with some introductions. Tell us a little bit about yourselves, your backgrounds, current roles. Howard, I'm going to start with you.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> I’m Howard Bowland, running the field services business here in what we call the Pacific zone, actually, which is a slightly romantic name for Australia plus New Zealand, I think because it includes some of the Pacific islands. I mention that because some of our customers for this offering now actually have offices across international boundaries, and this actually is an interesting solution for them as well.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: My history is almost three years with Schneider Electric now, having joined from the IT industry. About 20 years in the IT industry, working for Hewlett-Packard in its various forms, and most recently with Hewlett-Packard Enterprise before joining Schneider.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro</strong>: Excellent. All right, great, and Scott, can you tell us about yourself?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Sure, Scott Weller. I'm a partner with Mossrake Group, and we focus on technology-product companies that are looking to grow through services. These days, a lot of the conversations do go to as-a-service models and consumption and so on. Previously, I ran the global support services business in Hewlett-Packard Enterprise. During that time, I built a multi-billion-dollar IT as a service business that's now known as GreenLake.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Okay, excellent. Well, thank you both for being here. I'm excited to talk about what you're working on at Schneider. It's interesting to me you both have experience at HP, and this is a theme that comes up a lot in the conversations I'm having with service leaders across a wide variety of industries is looking to the IT space for inspiration in how to adopt some of these ways of thinking, mindset, culture, model, delivery, et cetera. What are your thoughts on that? What do you feel like you brought from those experiences, or how do you see that parallel? Howard, I'll start with you again.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Sure, it's interesting. I think there's a strong probably view that the as-a-service model was born out of cloud economics and cloud computing and so on in the IT industry. Lots of good innovation came from there, and it's very widely known, the big cloud providers, Google and Amazon and so on. But, really, it didn't really start there, but that speed of change in the IT industry, those innovations around software, and the impetus to really have the change the business model there because of commoditization probably accelerated the shift towards as a service and servitization in that industry. Really, it comes from much earlier than that, I think. Although, my first exposure was really working with Scott in HP around that. Scott, I think that's how I came to get really deeply involved in it.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro</strong>: Scott, what are your thoughts on what different industries are learning from the experiences that the IT space has had?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> The idea isn't really new. If you look at Otis, the elevator company, almost since their inception, you couldn't buy an elevator. You would only pay for it by the passenger car move or lift. Caterpillar, their largest earth-movers, you can't buy them. You pay by the load. Nowadays, like Rolls Royce, jet engines, you can acquire them, air quotes, acquire them through paying by propulsion hour. Xerox, HP have had print pay by the page for a long time. So really not a new idea. What I think is that any time you have a long-lived asset that may require specialty skills to maintain, it's a perfect setup for pay-as-you-go pricing. Then, if you think about a business that thinks of these assets as critical but not core, it's not the business they're in. It's not a core competency. It's very clear that this is a perfect setup for as-a-service models and really a shift to a focus to outcomes.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Yes, and we're going to talk a little bit about the difference there, right? We'll get into that, but that makes sense. I'm curious, Howard, if you can talk a little bit about ... So the program within Schneider is called EcoStruxure, okay, so tell us a little bit about the premise of EcoStruxure and how the idea to bring this concept to Schneider originated. How did it go over initially?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> So EcoStruxure in Schneider is really the framework for a lot of the digital enablement of the kind of infrastructure that Schneider Electric provides to customers and assist them in getting value. The evolution of that was offering EcoStruxured outcomes, which is about using that technology to provide the customer an outcome-based service contract rather than the traditional approach to it.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: Coming into this company, a slightly different segment from the IT industry, I was coming from having worked with the IT industry in developing that cloud economics for IT assets and for really operationalizing that in the Asian Pacific theater. But as I came into Schneider Electric, again, it's a technology company, much like other technology companies, like HP, has software and services. But there really wasn't anything currently in place around providing customer greater value over and above the traditional asset-ownership model. It first started with the thought of, "Could we do this? Why couldn't we do this with the kind of assets that the customers are acquiring from Schneider Electric?"</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Floated that idea here locally. Started talking to Scott about it, and we felt that there was a really big opportunity to start with the secure power technology. Talked to a few people inside Schneider, and, as usually happens when you start talking about outcomes and as a service, people confuse, really, the kind of offering that you're making. It's not ... There's a place for subscription, and there's a place for leasing. There's a place for asset ownership, but they're not the same thing. I remember talking to a few people, go, "Oh, yes, we've tried that. That doesn't really work," or, "You'll never get anyone to sign a lease," and all sorts of interesting comments about what perhaps had been tried in the past.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> I think a couple of things were happening at this point for me and for the company. Schneider Electric is on a journey of transformation itself and the way it's creating value for customers, so the time was right for the company to be considering innovation as well. I arrived at a time when proposing the idea again, perhaps, or in a slightly different way was actually well received by senior folks in the company, and I was able to get some investment to pilot the idea here locally and to develop the offer.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> It was interesting. I do recall talking to a couple of people, really being told that, A, you couldn't. We've tried it, and, B, anyway, you won't get people to agree to what you want to do. But, actually, it's not been the case, not been my experience. It's been well supported and not without its challenges, but that was the experience bringing the idea forward here.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Okay, and Scott, tell us a little bit about Mossrake's role in this project and servitizing the assets at Schneider.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller</strong>: Well, we came into this opportunity with Howard having all that experience back at HPE, so we knew, certainly lived through, the trenches of trying to introduce a new business model like this into a large, multinational company. Of course, we started with a look at the market but then quickly turned to an internal view: the culture, the appetite for innovation, the process for innovation, looking at the full value chain from sales channel, delivery operations. Came to the conclusion, as Howard mentioned, that there's a huge opportunity for the company. Really, as far as we can tell even now, no one is doing this but Schneider Electric. So we built a plan, and the plan was really based on the premise of agile development, so minimum viable product to find, looking at how could we pilot this and learn as we go.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Of course, over about 18 months, we got through that process and got it to general availability, but it was ... There's a piece of this is accepting that you don't know everything at the beginning. Howard and team were great to work with and had the same vision and the same attitude toward the process. Yeah, I think it's been a great success.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Yeah, it's interesting to me. We're interviewing people on this podcast all the time that are working toward the goals of servitizing and delivering more outcomes, and what exactly does that mean? What are all of the outcomes you could work to deliver to your customers, et cetera? I think the ... I wouldn't say that I don't know of anyone that's had help from a consulting firm or outside expertise. I would say it hasn't been regularly discussed, and it's just making me think of the value that would exist in bringing an outside perspective into the organization.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> I know, in this situation, you knew each other and had worked together previously, but one of the very common challenges that I pick up on in these conversations is just how difficult it can be to see the big picture when you're really in the day to day. It's just interesting to me, the role Mossrake has played in terms of just bringing a fresh perspective. You obviously have experience doing this, but also coming into a business and maybe seeing things or uncovering opportunities that it would be difficult to do when you're on the inside, if that makes sense. Okay.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> I could add I have to give a lot of credit to Howard. It takes a lot of stamina, tenacity, to really navigate this into a big company, especially if you're sitting in a region. You're not at worldwide, where a lot of the innovation is expected to come from. Yeah, and I was say, not to give ourselves too much credit, but I would say there are a lot of consultancies in the world, and the big names are there. It's really difficult to find a company, even among the majors, that have actually done this. They can talk about it. They're smart people. Taking nothing away from them, but finding a group of people who've actually done this across industry is very difficult, so I would say that's a key success factor in having this work.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Yeah, so you bring up a really good point, Scott. Howard, I'm just curious. That tenacity that Scott mentioned, it's a really good point. I've had a number of conversations with folks. We often talk about the fact that, to really embrace servitization, it needs to be a company-wide objective, right? It is very, very difficult to be in service and be the one evangelizing the value of servitization. I've had conversations with a number of people that are in that position that have ... I don't want to say given up, but they're incredibly frustrated, and I think ... I'm sure there's many, many elements here, right? Obviously, the willingness of leadership to listen, to hear out ideas, et cetera, that's a sliding scale, I'm sure, right?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Some of these people maybe are in a situation where it's just not happening, but Scott's point made me just want to ask you: What made you ... How did you find that tenacity? What made you listen to some of the, "No, we've tried that. It didn't work," and just keep pushing, instead of saying, "Okay"?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: The easier path probably would have been to accept that, I guess. I think a couple of things. Yes, definitely a lot of energy required managing stakeholders and finding a pathway. It's important, if I go back, why did I have that energy? I think one of the reasons was on the back of success I'd previously had with Scott and with Hewlett-Packard in changing the business model inside that company. To be honest, it was difficult at the beginning there. We had almost a lost year, or I did, in terms of finding the way through, but, in the end, it was very successful. I understood it was challenging. Understood, though, it could be done. And trying to draw the parallels to see is this vision really doable here? Believed it was.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> I had the advantage, I guess, of my upstream management being open to discussions and then ultimately finding a global leader that was really passionate about it as well to help the funding. But there's a lot of people between that person and getting it done, and that's where it takes a lot of energy. You're right. In large, particularly in large technology companies, there's obviously the traditional product sales method, and there's a lot invested in that. That's still an important model, so managing in a non-threatening way how this can be an additive offering that is really customer driven, and the ability to bring in ...</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> You talked about consultants, and some people might think of consultants as advisors that can write a report, for example, but, really, the Mossrake team and Scott were in the trenches actually developing the offer. What it gave me the opportunity to do was to have confidence that we had done it, that we had people that knew how we could navigate it in a new location, and then to bring my own people on that journey and see and learn from being part of that. What I found was that people wanted to join the team and wanted to be part of it because they saw the excitement through in the innovation, the learning opportunity to do something really quite new. And introducing a new business model into a company of any kind is even more challenging than you think even if you've done it before.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Yeah, that makes sense. Okay, so let's talk a little bit. Howard, can you summarize the value proposition of the offering and let's just talk a little bit about ... We alluded earlier to some of the perhaps ... Maybe not misconceptions, but interchanging of terms that can cause some confusion when you're talking about this evolution.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Yeah. Yeah, okay, thanks, Sarah. Yeah, often people will use a finance company and call something as a service or a subscription as a service, and that tends to muddy the water a bit about what really does it mean to be consuming something as a service or getting an outcome for your service contractors, opposed to piling together the hardware, software, and services and just financing that.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> There's a number of key value points, I guess, for the offering. What we found is that any given customer might resonate strongly with a few of those, some with all of them, but it varies across customers. Firstly, there's an OpEx orientation. There is the ability to change the way that people spend their capital into possibly an OpEx classification, but in a time-based way rather than committing their capital budgets up front, and then they're able to use that released capital to do other things with. It lines up their costs with their business model, particularly, or their needs. The way they get billed and charged is in accordance with their business model, and so it can line up the costs for them of running things like secure power to the way that their business model runs. That's a benefit for them as well.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> It's much more scalable. One of the big ... And sustainable. What I mean is that, as in IT, we found that there's a lot of over-provisioning going on in technology because people are either not experienced in sizing it or don't have the time to size it right or don't want to take the risk because changing it is really difficult. So you end up with over-provisioning and therefore over-consumption of things that is unnecessary. You end up with possibly a less-scalable model. Through an outcome-based orientation, as the needs change for the customers, so we can change the provisioning of the technology to match those needs in a much better way</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Another big point we found was that customers were consuming a lot of their own resources in managing this asset. It seems to be complex. We saw that there were two classes, broadly. Customers where having critical support for their power was really important but not their core business. They did something else. They're a healthcare agency, for example, or a manufacturing company. They really needed it, but they didn't really want to be bothered with the technology. Then there's another class where it's really core to what they do.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> In that first category, customers were consuming a lot of their internal resources looking after this infrastructure and offloading that burden to somebody is actually a better place to do it because we understand the technology better with a really important piece. That helps them and we see that doubling down here in this theater, anyway, the ability to get talented people in the market is really challenged because of the growth that's coming in places like data centers and so on.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Operational risk is reduced because the aging of the assets and the life-cycle management are no longer the problem of the customer. It's something that we manage. With a digital connection and analytics, we're able to do that in a much more effective way. Of course, there's the resilience of the infrastructure because we're monitoring it and managing it on a 24-by-seven basis. They're the core pieces, and one or other of those would tend to resonate more strongly with a customer than another, but, in the end, they all go to making a strong value proposition that resonates.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Okay. You said earlier this isn't for everyone, right? This isn't a situation where Schneider is deciding to only offer the outcomes-based model. You are adding it in addition to. Talk a little bit about why that is and the need to be able to meet the needs of customers that are on either side of that equation.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> It's the case that there are customers who obviously manage their capital, their balance sheets, and so on in different ways. So owning capital items or not, having assets or not is sometimes a business decision for the customer which is unrelated to IT or unrelated to secure power, and so there are reasons why that's what they will want to do. They will want to perhaps be close to their infrastructure and manage and operate it themselves, and so there's a need there. The go-to-market model itself is the ability to reach a large number of customers. We have an indirect go-to-market model. There are customers that prefer to transact in different ways.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: The traditional capital asset-ownership model is still alive and well and still fits a portion of the market. As customers are looking to maybe shift their risks to get greater value, to get probably a bit more mature in understanding how their business model works, would be looking to move to this outcome-based model. There's going to be horses for course there: size and importance of these assets to customers. There's always going to be smaller footprints that perhaps it doesn't make sense to do it with, and there will be customers that are major, hyper-scale customers, for example, that will always want to have a much different relationship there. There are a few thoughts from me on that.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Now, is it more complex for you to, as an organization, offer both choices than it would be to just pick a path, or does it not so much matter once you've made the transition to both, phasing one out would be neither here nor there?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Yeah, I think my view is that there's no added complexity by having both models available. The complexity perhaps comes in how the go-to-market model works. If you decide you're going to have an outcome-based model that's asset free for the customer, that has a whole lot of value-adding services, we need to be able to manage and record and deliver against, that's a piece of complexity that, once you've decided to go there, you have to solve for.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Whether or not you continue to have an asset model for capital purchase doesn't really add to that complexity a whole lot except perhaps to say that you could redesign your entire supply chains and manufacturing processes just for as-a-service model, and that perhaps would ultimately simplify things.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro</strong>: Yeah.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> In fact, the opportunity with something like an outcome-based offering is to start thinking about building your products so that they're fit for, designed for servitization, and this could mean you need fewer customer-facing features, and you could create a lower cost, potentially, or something that's more suited to this flexible outcome orientation.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> In some ways, there isn't extra complexity once you've decided to go that way, but probably you could ultimately simplify things. That sounds a bit contradictory, but that how I think about it.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro: </strong>No, it makes sense, and I think what made me ask that question ... I was just recently recorded a podcast with Phillips and was talking in a similar vein about the fact that they too are offering outcomes, but they have not shied away from their traditional business model. It's similar to what you were saying, which is they want to offer the choice, and that's why I was asking that. I don't know in their situation, I don't think that I asked if he envisions everyone migrating at some point to the outcomes model. You just said that you'll always have customers that you feel keep the capital model.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> It's just interesting, I think, to talk about these things because, again, I think organizations that are looking at how to progress through this journey maybe look at it as an either or, not necessarily a both, right? Just looking at these two examples, yourselves and Phillips, those two examples of people that really is leading with the customer-centricity of choice, right? You're basically saying, "Great. If you want this, we can do this. If you want this, we can do this." It's just an interesting aspect of ... It doesn't have to be you put all your eggs in one basket.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> Yeah, I think I'd be interested in Scott's view. If I just maybe reflect a little bit more on that comment that it's very challenging to switch the business model to as a service and let go of your traditional model because you need to obviously feed the machine. At some point, I do think, yes, a company could make a decision, so this is not speaking for Schneider, but you could make a decision to say, "Our future is in as-a-service consumption-based models, and we're going to retire the traditional capital way of doing things. Those customers that need that, we feel that there's a bigger opportunity to stay here. It's going to simplify our operations. It's going to simplify our go to market," because it's true.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> As we go out there, and we think about our customers and what they need, we have to make a choice about how do we position the best value to them as we go option A or option B. If you offer everything to a customer as a big menu, it can become confusing, so it's important to be clear about what you think the best value is for them. There's definitely complexity, and we found that as well on this journey of migrating our go-to-market model to understanding how compensation works, how people are motivated, their own skillset, what their knowledge base is, and shifting to talking to ...</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> You need to talk to a different part of the customer about this proposition. The traditional people you engage with aren't necessarily the people that make this decision. Sometimes you're displacing somebody's job because, actually, in a sense, you may be moving work from them to us. Scott, I'd be interested in your view, though, on that, please.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Yeah, I think you said it well, Howard. The reality is this new business model changes your company. It also changes your customer. They have to think differently about who Schneider is, how to interact with you, how their operation marries up to you as a supplier, and so all those changes are when really they're onboarding in the midst of changing to what looks like a pretty straightforward shift to paying differently for an asset, if you will. Being able to think more in terms of outcomes than managing assets, but it's that wholesale change on both sides that I think is one of the reasons of many, as you mentioned, that companies need to continue, suppliers need to continue providing both ways. The market is mart. Customers are smart. They figure out what they want, and, when the time is right ... And our experience in the past is, when the time is right, they begin to adopt more quickly into this need model.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Scott, can you talk a little bit about what is involved in developing that new go to market, right? You come in, and you did this at HP, but you come into Schneider, and it's a whole new world, right? What are some of those considerations in developing the go-to-market strategy and the different points that companies need to be aware of examining?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Well, I like say, and not entirely in jest, that a new model like this into a big, mature business breaks everything, including the go to make, so you can imagine the go to market is one of those places that people are paid very closely aligned to their performance. So you can think of that part of the operation as being highly optimized for the outcome, and now you're asking them to tell very different stories. Maybe they're not stories that they're comfortable telling or you need a different mindset in those roles to tell this new story and have those kinds of customer dialogues, as Howard said, with different people. Instead of maybe someone in procurement or someone on the front lines of operations, now you're talking to somebody in the CFO's office, let's say.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller</strong>: That's the start of it, so the sales enablement for a different kind of sales operation is a big piece of this. Can't forget the channel implications, particularly companies that are heavily channel oriented. You have a whole set of different issues to resolve, but it really starts with: What is the story; what is the vision; what is the pitch for the offer? Then bringing them through that journey so that they can tell the story, be effective at doing that.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> The sale cycle is completely different, much longer, typically. They have to be accustomed to doing that. If they're more transactional, it's very difficult for those individuals to transition, and so there's just a lot of work involved in bringing the go to market around. What I had to do is build a SWAT force, a global SWAT force, because you couldn't rely on bringing people along fast enough. You had to show and do and bring people along that way, figure out who could come along on the journey to this new kind of go to market. In a way, with Howard, we've done a little bit of that, injecting people who, both from our firm and other folks within the organization, to be that SWAT deployment to go after the early deals and bring the rest of the organization along.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> It's almost like train the trainer. You're doing that initial push yourself so that they can see how it's done, and then you can see how they do it and if they're capable of bridging that gap.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Yes.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> That makes sense, and I want to come back to that, but, real quick, what would you say the ... I know I'm asking you to really generalize here, but what would you say is most important when you shift the conversation from talking to purchasing or operations to the CFO. For companies that are adjusting to having the CFO-type conversations, what have you learned is the key to your best chance of success there?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> I think the appetite to move to a model that doesn't tie up capital is a way into the conversation because capital lock-in, in many cases, not everyone, because there are capital-intensive companies that intend to remain that way, but that a hook for someone in the CFO's office is just to explain to them that this gives them flexibility in an uncertain world. But then, also, to think about it operationally, that their people are focused, perhaps, on the wrong things. Get the people you have focused on things that are actually core to business. Those are really the interesting conversations you can have. Of course, you can have that with someone who is, today, operating the equipment or managing the equipment.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Sure. What about risk as well, right? I would think that would be another significant aspect of the conversation that would be appealing.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Well, certainly, in a lot of industrial products, they tend to get sweated. They run longer than they should or they're operating without all the care and keeping that they need. So, yeah, there is definitely a risk element. We would never want to say that their current operations are sub-par or anything like that, but, for sure, having experts keeping an eye on things, making sure that when certain elements or certain entire products really need to be replaced or refurbished or what have you, that that gets done timely, yeah, absolutely, that's a risk element that we can address with an offer like this.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Okay. All right, and then going back to the SWAT, I think it's a great idea, and we're going to talk in a bit about the fact that, for Schneider, doing this in a region is a really smart approach, right? Because I'm just thinking that SWAT model is something that you couldn't do if you were doing this all at once on a global scale, right? That idea of creating success and then replicating it, versus trying to create massive, wholesale success all at once is important, and we're going to come back to that. But that SWAT idea makes a lot of sense in terms of the specific skill it takes to initiate those different types of discussions, to map and to articulate that value proposition, and then to be able to tailor it to specific customers you're speaking with.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> That's a super-smart idea, versus just saying, "Hey, here's a really important customer, so hey, sales rep that's been selling capital sales for however long, go give this a shot and let us see how it goes," right? I like that point. Howard, in terms of the go to market and adjusting to this new world of conducting business, what other points would you touch on?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> That's a good point you just made as well. In the early stages, in fact, you want to keep the uneducated or uninitiated salespeople away from the customer conversation until ... Because there's the opportunity to actually spoil the ground by misrepresenting what's happening, for example. The most common thing that gives you a signal that something's going wrong is that the sales guy will say, "Look, the customer wants a capital quote, and he wants your as-a-service quote." Okay, well, straightaway we know you haven't had the real conversation because it's not about getting cheap hardware. That's not ... If you want cheap hardware, this isn't the way to get it. This is getting an outcome, which is more cost effective for all these other business reasons. You're either talking to the wrong person, or you've talked about the wrong things.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> The go-to-market change is a really important. You do need the specialization, the SWAT, to come and start profiling the customers before you go meet them with the salespeople, and then introduce ... In the early days, at least, have the topic introduced by the specialist to detect whether there's real interest. We've since offered some sales tools and some training and so on that helps the general sales force understand the concept better, helps us profile the customer better, and can start those conversations. But to work them through the pipeline, we need to still have a pretty high degree of specialization.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro</strong>: Now, just a quick point on that, Howard. Did you find that, again, this is a general question, have you found that you've been comfortable looking to transition to this new strategy with the type of people you had already had on staff, or have you started in recruiting to look for different skillsets?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland: </strong>Yeah, so it's a sensitive question, I guess, perhaps it depends who's watching. It's a bit of both. As you look across the existing sales force or the go-to-market people, we can see there are people that can go on the journey of understanding the proposition and be able to articulate in a way. So a small number of people we can highlight in our organization that can go on that journey, and we need to recruit specialist salespeople to support that and to drive that last mile. It's a bit of a combination, and there's definitely people who it's not their core competency to be able to do this, so again, selecting the right customers and preparing them the right way and the resources around that to get scale is important to do.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Well, and going back to the fact that you're still doing the capital side of the business, right, so the people that don't necessarily want a new challenge don't have to embark on this journey, but, yeah, that makes sense. Not everyone likes change, right? Some people think, "Oh, this is cool. This is new. I want to learn this, and this could be a really interesting opportunity for me to do something different," and other people are going to say, "No, thank you. I'll just keep doing this thing that I like to do."</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: Even the people who say they like change don't really like it. It is a challenge, and so you're right. Some people are definitely happy doing a good job that they've done for a while. Others are really looking for growth in themselves and are excited by the innovation. Now coming back to the notion of the SWAT team and the way we've been successful. You do need high levels of energy and commitment and belief. You've got to, as Scott talked about in his previous experience, believing in what you're doing is important. If we were to move any other geography, you have to have some visionary or somebody who really wants to take on the ownership and the belief to ... Because it will take a fair bit of energy. We've been able to do a lot with what we have, but it also has, as Scott mentioned, it breaks most pieces you touch, and you have to do something to put it back in a different way.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> That's good point, Howard, because, obviously, as you're spearheading this evolution, you're still doing your other, quote, day job, right? A lot of other folks are as well, right? How did you enlist people to help run those things in parallel, right? When you're in that exploratory and design and build phase, you're still doing all of the normal things you're doing while you're also working hard to innovate and build something different. You have Mossrake, and so you have external help. You're committed to it because you're the one with the passion behind it, but how did you bring other people on board to buy in early and be a part of bringing it to life.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> It's interesting. It was a couple things, I guess. Being able to tap into my own experience, but people that I'd worked with and trusted, enabled me to go find some people in my organization who were willing and enthusiastic but maybe not experienced to put those two things together. Without either of those things, it would have been very difficult to do. At the same time, we took the decision, as we're building out and changing things, documenting them, all the service processes, all the changes, in a structured way, so they could be reused both internally in our operation here, but also it could be translated elsewhere.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> What I found in talking to people about the vision and the idea was, actually, there were some pretty enthusiastic people in my team or in my organization that really wanted to do something different. I could ... We got them ... It enabled me not to have to build a structure internally that was dedicated to this mission. We could leverage some external resource, use some agile resource, maybe I appointed one full-time person initially, and then we had people ... Actually, I asked them to spend their time on it, and I directed the traffic a bit and freed up their resources, but then we had people volunteering, really to spend discretionary effort on it, and they were excited about what we were doing because it was new and different, and they could see the vision. They saw themselves learning and getting a fabulous professional experience as well, so that's enabled us, this journey over the last 18 months, to use this agile ... Agile doesn't mean ad hoc. It means that you've got, perhaps, people coming and going from team and achieving the things in smaller timeframes.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland:</strong> That's really the approach we took that I think ... I'm very proud that the team locally actually has stepped up, the people, to be part of it. Subsequent to that, I've now appointed a digital transformation manager that oversees all the operational capability development, and we've reached out to other parts of Schneider to understand how their system development can now fix some of the manual processes that we've had to develop and so on. So restacking the bricks of Schneider service actually was, in some ways, not the most difficult thing, although it's challenging. I would still, on balance, getting the go-to-market model right, talking to right part of the customer with the right message, that's still the most challenging thing in this business-model change, I would say.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> It makes sense, makes sense.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Howard Bowland</strong>: You could have a great offering, right, but if you can't get it to the market, then it doesn't really matter.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Scott, would you say, based on your experience going through this process with other organizations, do you think those, I don't know, for lack of better term, change agents or the people that you could enlist to help get this off the ground, do you think they're ... Can you usually spot them? Are there commonalities where you can say, "Okay, this person, this person, and this person, let's approach them and see if they want to get on board," or is it just you have to get started and see who shows interest?</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Well, my experience is just that. You know who the adventurers are. Now, not everybody who's excited to go on a journey is really the right person at that time.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong> Up for it, yeah.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Scott Weller:</strong> Well, they may be up for it, but really not the right person, not the person you need at that moment, but in big companies, adventurers are hard to find. People get pretty siloed, and even I would call professionals in the sense of what they do they do very well, and change, as you said, is difficult, so that is really key. Fortunately, Howard had a number of adventurers in his organization who he could tap. The other thing is they have to keep doing their day job as well, in many cases, as they come on board. And eventually can be assigned full time, but it takes a lot of commitment, tenacity, and a curiosity about how things work to really thrive in that kind of environment.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Sarah Nicastro:</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Yeah, it sounds really interesting to me. I think I would be a volunteer, Howard, if you're doing it again. Okay ...</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>This is part one of a two-part podcast. Be sure to tune back in next week for part two!</p> <!-- /wp:paragraph --></div> </div> </div> </div> <div class="col-12 col-lg-3"> <div class="form-wrapper"> <h2 class="form-tittle">Stay Connected</h2> <iframe src="https://info.ifs.com/GM-CP-CU-2012-12-FoFS-Newsletter_IFrame.html">