00:00:02
I want to welcome Ganesh air who is the
00:00:05
CEO of emphasis nit services company and
00:00:09
also cark hosanagar who is a professor
00:00:12
of operations information and decision
00:00:15
here at Wharton thanks for joining us uh
00:00:17
today for this conversation about how
00:00:20
CEOs and other top officials can get the
00:00:24
digital skills they need uh to lead
00:00:27
their companies in the new digital age
00:00:30
Ganesh let's start with you uh some of
00:00:34
observers note that CEOs don't
00:00:36
necessarily have to have all the
00:00:38
technical skills that their technical
00:00:40
staff has obviously but they have to at
00:00:42
least be comfortable with it and with uh
00:00:46
with digital topics uh but the question
00:00:50
is how do they get that information how
00:00:52
do they pick it up uh is this knowledge
00:00:55
uh best to come in say through mentors
00:00:58
is it learning through experience uh who
00:01:02
can who can train the CEO to be a
00:01:05
digital leader
00:01:07
today a very interesting question and
00:01:10
let me kind of draw upon my own
00:01:13
experience when digital kind of started
00:01:16
coming through in the industry some
00:01:18
people see it as a disruption some
00:01:20
people call it Revolution as a CEO I
00:01:23
took a step back and I said am I the
00:01:26
right person to lead this company in the
00:01:29
digital world we are in IT services
00:01:31
clearly at the leading bleeding edge of
00:01:35
digital so um I decided that despite me
00:01:39
being 54 years old and 30 years in the
00:01:42
industry that cannot be the baggage that
00:01:45
cannot prevent me from learning and
00:01:47
picking up these skills and I felt
00:01:49
compelled that as a CEO I need to learn
00:01:52
so that I can work with my team to take
00:01:55
emphasis in the digital era if I may so
00:01:59
I went and spoke to Educators people
00:02:02
like Karthik um understood their point
00:02:05
of view I went to startups amazing work
00:02:08
is being done by youngsters they are
00:02:10
challenging status quo Innovation their
00:02:12
language is different the way they think
00:02:14
is very different of course you have
00:02:17
forums where people come and talk about
00:02:19
digital pure place um and you get to
00:02:22
learn I went to conferences which are
00:02:25
actually meant for really young people
00:02:27
because I wanted to experience what goes
00:02:29
on in the real
00:02:30
world so uh that's how you know from
00:02:34
books is is a good source of knowledge
00:02:36
but it doesn't give you that vibrancy
00:02:38
because it is a kind of there is no
00:02:41
interaction but talking to uh people who
00:02:44
are both practitioners and
00:02:46
professors uh young people so I uh I had
00:02:50
to lower my ego I had to uh be prepared
00:02:54
to fail and uh I had to admit that I
00:02:58
need that knowledge and that source of
00:03:00
knowledge can be anywhere and I need not
00:03:02
feel like a CEO that I cannot go and
00:03:04
learn from somebody down below in the
00:03:06
organization youngster or these
00:03:09
conferences and that helped me a
00:03:11
lot cark U what what's been your
00:03:14
experience how do you find that CEOs are
00:03:17
getting their information or how should
00:03:19
they be going about it yeah first of all
00:03:22
I appreciate the not to professors uh
00:03:24
very much uh but you know I I think uh
00:03:27
ganesh's uh answer really um resonates
00:03:30
with me as well uh I think what is
00:03:33
important first and foremost is for
00:03:35
leaders to be open to learning and have
00:03:39
that uh attitude of exploration and and
00:03:42
trying to acquire new knowledge I think
00:03:44
they do need mentors especially analog
00:03:47
CEOs that are trying to make this
00:03:48
transition they do need mentors and
00:03:51
those mentors may be within the
00:03:52
organization for example to include your
00:03:55
CTO and and cios in key strategic uh
00:03:59
discussions and and conversations they
00:04:01
can also be from outside and and Ganesh
00:04:04
mentioned startups and uh it's actually
00:04:07
a very um helpful exercise for uh very
00:04:11
traditional analog CEOs to be actively
00:04:14
following that industry to perhaps even
00:04:17
actively participate in that we see many
00:04:20
companies have corporate Venture Capital
00:04:22
divisions through which they partake in
00:04:25
the startup activities as investors and
00:04:27
sometimes they invest in opportunities
00:04:30
that even appear competitive to what
00:04:31
they're doing but that's a way to learn
00:04:33
that's a way to stay relevant and that's
00:04:35
a way to be able to respond when the
00:04:38
time is right to do that finding mentors
00:04:41
and sources of information but after
00:04:43
that it's still up to you up to CEOs to
00:04:47
sort through all of that noise and
00:04:50
figure out what's best for the company
00:04:52
CIO can help you but ultimately the
00:04:54
decision rests with with the CEO so how
00:04:58
do you do that how do you sort through
00:05:00
that information after listening to your
00:05:02
mentors and listening to your technical
00:05:05
staff um how do how do you make your way
00:05:09
through all of that just one um point
00:05:12
about technical staff because I think
00:05:14
the world under has misunderstood that
00:05:18
digital is about
00:05:20
technology I believe digital is about
00:05:24
business and uh technology enables the
00:05:28
business so the the distance between
00:05:30
technology and business is blurring now
00:05:33
it has become
00:05:34
integral um so to that extent if I just
00:05:37
rely on my CIO or technical staff to
00:05:39
give me advice about digital I would be
00:05:42
probably not doing the right thing by
00:05:44
just relying on that
00:05:46
information now coming to your question
00:05:49
how do I separate music from noise how
00:05:51
do I convert uh my knowledge or
00:05:54
experience into something useful for the
00:05:57
company I watched this video which was
00:05:59
very fascinating which talks about why
00:06:02
do you exist what do you do and how you
00:06:05
do these three circles as long as you
00:06:08
are clear as to why do you
00:06:10
exist and that why is not generating
00:06:13
shareholder returns because I mean I
00:06:14
think that is a that is a very common
00:06:16
term people say why do you exist my job
00:06:18
is to generate shareholder returns
00:06:20
that's true of every company you have to
00:06:22
talk about what is the value that you
00:06:23
bring to your customers your employees
00:06:26
and uh the society at large so why do
00:06:28
you exist if you visit that and think
00:06:31
about your vision and mission statement
00:06:33
that's a that's a very telling thing and
00:06:36
when you look at it lots of ideas come
00:06:38
flooding to you you don't feel
00:06:40
constrained by how you operate today
00:06:43
because you start thinking uh completely
00:06:47
fresh and U I had the advantage because
00:06:51
our vision and Mission is so clear as to
00:06:53
why we exist that became my guiding
00:06:56
principle and that helped me to to uh
00:07:00
separate uh music from noise and second
00:07:03
thing which helped me is as this
00:07:05
disorientation is happening the access
00:07:08
which I'm hanging on to is my customer
00:07:11
because ultimately my job is to make my
00:07:13
customer successful so if you hang on to
00:07:16
your customer and make sure that you are
00:07:18
closely knit with your customer that
00:07:20
gives you that access of stability so
00:07:23
these are the two things which have
00:07:25
guided me and uh time would tell whether
00:07:28
that has I become success suful in it or
00:07:30
not I'm just sharing what how I
00:07:32
approached it personally cark the the
00:07:35
CEOs are are are looking at all of these
00:07:38
sources of information making decisions
00:07:40
such as Ganesha is talking about but at
00:07:43
the same time they're they are trying to
00:07:47
focus on their business it's great if
00:07:49
your if your mission is very clear but
00:07:51
they're looking at the cloud they're
00:07:53
looking at mobile they're looking at all
00:07:54
these things and it and it does get
00:07:56
confusing what's your advice on how they
00:07:59
could separate the noise from the music
00:08:03
I think there there is certainly going
00:08:05
to be a temptation to adopt the next
00:08:08
buzzword in your organization if
00:08:10
everyone else is going on the cloud I
00:08:12
need to be on the cloud if everyone's on
00:08:14
mobile I need to be on mobile and so on
00:08:17
and that's going to be more so true I
00:08:19
think where the CEO feels less and less
00:08:23
comfortable with um I think with their
00:08:27
knowledge of the digital domain
00:08:30
um and I think I go back to what Ganesh
00:08:32
was saying that it's not really
00:08:33
important or necessary for the CEO to be
00:08:36
a technologist uh really digital
00:08:39
transformation is not fundamentally
00:08:41
about digital it's about digital being
00:08:43
an enabler of a business Mission or a
00:08:45
strategy so I think at the end CEOs have
00:08:49
to understand technology to the extent
00:08:52
of knowing what it can or cannot enable
00:08:54
and once you understand what technology
00:08:56
can or cannot enable that is a secondary
00:09:00
consideration and the primary
00:09:01
consideration is what does your customer
00:09:03
want and are you able to deliver unique
00:09:05
value and I think when you pair the two
00:09:08
together I think that's where uh they
00:09:10
can succeed uh but also I think to your
00:09:12
point about there being a lot of noise I
00:09:15
think uh in this kind of an environment
00:09:17
I feel Business Leaders have to also
00:09:20
accept that there will always be a
00:09:22
certain amount of noise uh in the market
00:09:25
and in the landscape and they have to be
00:09:28
willing to take a few more risks than
00:09:30
usual because of that I completely agree
00:09:32
I mean I think we need to be prepared to
00:09:34
fail right exactly because as you get to
00:09:37
the position of CEO one of the things
00:09:39
which happens to CEOs is they are very
00:09:41
afraid of failure because they are
00:09:43
worried about their public face you have
00:09:46
reached uh that height and the fall can
00:09:49
be
00:09:50
huge and and we need to overcome that
00:09:53
fear and that's when you will try and
00:09:56
when you try 10 things it's okay if you
00:09:58
fail in three
00:09:59
uh as long as you fail early you cut
00:10:02
your losses it's okay but uh not trying
00:10:05
is not an option at least in my mind I
00:10:08
think that is so important uh today
00:10:10
because you know I've worked with many
00:10:12
companies and I've always noticed there
00:10:14
is this tendency as you said the higher
00:10:17
you are the more fear you have of
00:10:19
falling from that height and I think
00:10:21
there is this tendency among a lot of
00:10:23
companies to be more risk ofs and manage
00:10:26
everything around what can go wrong as
00:10:29
opposed go to what's the opportunity and
00:10:30
I think uh and that's why startups
00:10:34
sometimes can pursue those big
00:10:35
opportunities because they're not as
00:10:36
worried but I think CEOs need to adopt
00:10:39
or Embrace failure as a natural part of
00:10:43
innovation so a lot of top leaders also
00:10:46
recognize that they need to do this
00:10:49
digital transformation in order to
00:10:51
protect themselves from Pure place or
00:10:54
startups and that sort of thing how can
00:10:57
leaders actually protect themselves
00:11:00
perhaps impossible to do completely but
00:11:02
protect themselves as best they can from
00:11:04
so-called asymmetrical challenges and
00:11:07
bolts out of the blue those kinds of
00:11:09
things um you know people used to talk
00:11:11
about being amazoned you know back in
00:11:14
the dotc era there everyone's worried
00:11:16
about being amazoned the way amazoned
00:11:19
amazoned the uh the book sellers so can
00:11:22
you prepare how what's the best that you
00:11:24
can do in that realm at least the
00:11:27
mindset that I carry that I don't have
00:11:29
to worry about protecting myself I have
00:11:32
to focus on
00:11:34
attacking because that's attack is the
00:11:36
best form of
00:11:38
Defense I see digital as a huge
00:11:41
opportunity for IT services company I
00:11:44
see that as a huge opportunity for
00:11:46
emphasis I see this as a shuffling of
00:11:48
the deck and if we do the right thing we
00:11:52
will come on top of the deck so I don't
00:11:55
worry about protecting I think about
00:11:58
what is the advantage that I have versus
00:12:01
uh Pure Play and I want to leverage that
00:12:04
advantage in this new world of digital
00:12:06
of course I have to deal with the
00:12:08
challenge of Duality I'm not going to
00:12:10
give up on my analog overnight being a
00:12:12
listed company and yet I have to adopt
00:12:15
digital that Duality is an additional
00:12:17
burden that an organization like mine
00:12:19
carries but comes with The Duality
00:12:22
certain
00:12:23
strengths if I have worked with a
00:12:25
customer for the last 12 years and they
00:12:28
trust our brand they believe that we
00:12:31
care about uh their success a new player
00:12:35
who comes in despite being
00:12:37
glamorous will have to prove themselves
00:12:40
and if I can leverage that inherent
00:12:43
brand value that's something they don't
00:12:46
have so I think about becoming an
00:12:50
asymmetric um attacker rather than
00:12:54
defending myself uh from asymmetric
00:12:57
competition and the second point which I
00:12:59
want to make in all
00:13:01
this of course CEOs get either
00:13:04
slaughtered or
00:13:06
glorified but none of this is possible
00:13:10
if you're not taking the entire village
00:13:12
with
00:13:13
you success is can never be achieved
00:13:16
alone especially if you're a listed
00:13:17
company CEO you need to find the board
00:13:21
who is supportive who is willing to be
00:13:23
the Challenger who is willing to back
00:13:26
you you need to have a leadership team
00:13:29
which believes that they want to change
00:13:31
as well to be successful because what's
00:13:33
in it for me is a question which all of
00:13:35
us ask including the CEO so these are
00:13:38
the factors that you have to keep in
00:13:40
view while you're trying to transform
00:13:42
the
00:13:43
organization and injecting the the
00:13:46
excitement that we are going to win and
00:13:48
we are going to win big so cark the best
00:13:51
defense is a good offense do you agree
00:13:54
with that and and what would you add to
00:13:56
it or what how would you disagree uh I
00:13:59
agree with what Ganesh said I think I
00:14:01
agree completely with your strategy I'll
00:14:03
maybe uh suggest a couple uh more uh
00:14:07
tactics as opposed to uh an alternative
00:14:10
strategy I think strategically going as
00:14:12
you suggested be uh you know be
00:14:14
aggressive as opposed to being defensive
00:14:17
um so how do we do that I think one way
00:14:19
to do that might be to create a
00:14:22
structure within within the organization
00:14:24
that allows you to pursue these new
00:14:27
digital opportunities what's going to
00:14:29
happen is often times for large
00:14:31
successful incumbent analog
00:14:33
organizations new digital opportunities
00:14:36
may not meet your standard litmus test
00:14:39
is the market size big enough is it uh
00:14:42
is it meeting the needs of my current
00:14:44
customers and so on 5 years 10 years
00:14:47
down the road it might but not today and
00:14:49
so it becomes hard to pursue those
00:14:52
opportunities in the traditional
00:14:54
structure so you need to create a
00:14:55
structure to be able to pursue that I
00:14:57
think the second is that sometimes those
00:15:01
opportunities will cannibalize your
00:15:03
traditional revenue streams and so
00:15:05
Ganesh said you cannot ignore your
00:15:07
analog uh opportunities which are today
00:15:10
which are delivering shareholder returns
00:15:12
today so again with a more traditional
00:15:15
format when you're cannibalizing your
00:15:18
cash cow at some point you're going to
00:15:20
say let's shut this new opportunity so
00:15:22
you need to create a structure to be
00:15:24
able to support that one structure which
00:15:26
I particularly like is where you spin
00:15:28
off divisions you might control them but
00:15:30
let them work
00:15:32
semi-independently uh to be able to
00:15:34
pursue those opportunities and at at the
00:15:36
right time you decide whether you uh you
00:15:39
know you kill the initiative you let it
00:15:41
continue in the in the format it's
00:15:43
continuing or spin it off as a separate
00:15:46
entity or bring it back in and this is
00:15:48
your new uh main cash cow but I think at
00:15:51
the end of the day
00:15:53
acknowledging that cannibalization is
00:15:55
going to be the nature of digital
00:15:57
Innovation and
00:15:59
you have to support that cannibalization
00:16:02
by allowing new initiatives to be
00:16:04
independent thanks to both of you for
00:16:06
coming in today and chatting with us
00:16:08
thank you for having us thank you
00:16:13
[Music]
