Schneider Electric: Digital transformation, internet of things, sustainability, and operational technology

Learn key lessons from Chris Hummel, CMO of a global technology organization undertaking important business transformations.

Looking across the landscape of enterprise technology, few companies have the scale and breadth of Schneider Electric, with over $30 billion in revenue and 130,000 employees in more than 100 countries.

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Chris Hummel (image courtesy of CXO-Talk)

Schneider Electric is in the midst of transforming itself from a supplier of components and industrial parts to a broader technology company. This new face of Schneider Electric includes focus areas such as internet of things (IoT), sustainability, and the convergence (PDF download) of information technology (IT) and operational technology (OT).

At the same time, the company faces marketing challenges because it owns many worldwide brands but does not possess consumer-level brand awareness, at least in the U.S. The underlying question, therefore, becomes how does a large, 170-year old technology company undertake its own digital transformation?

Also read:
Digital transformation and the high performance enterprise

To explore these issues, the relatively new Chief Marketing Officer of Schneider Electric, Chris Hummel, came on CXO-Talk for an in-depth discussion. You can watch the entire video and read my edited summary below.

On sensors, innovation and the Internet of Things (IoT)

You have sensor technology going everywhere collecting all kinds of new data. You have computing power, which is no longer just in the data center but actually at the edge as well. You have shifts in almost everything that we do.

But, now, all of a sudden, you are not just talking about efficiency, but the possibility of new capabilities of productivity; efficiency sure, but also new levels of understanding of your business.

Think about something like a crane. Let's imagine Shanghai where there is one of these big cranes, putting up one of these massive skyscrapers. There is a data center sitting in that crane. We have actually built a data center into it - why?

Because the number of computations that needs to be handled to manage wind speed, velocity, weight, height above sea level, gravity, shift, angle, load, all of those kind of things. And, they have to be repeated constantly in milliseconds to manage appropriately for safety, reliability, performance, asset, life cycle - all of that kind of stuff. The volume of information that is now going to be spit out from these sensors about operational data - wow, that's unbelievable.

On sustainable, smart buildings

In our headquarters in France, we have what we call the international customer lounge. It has a screen that shows usage of energy in the building. It actually watches dead spaces in the building and turns down the heating, or turns up the heating or air conditioning based on usage of the building.

Short-term, it saves me some money just like a smart thermostat. But, over time, I can actually identify areas of the building that I'm not using and put them to other uses. I can use them as storage; put more office space in there; see the hoteling requirements for the building, not just through badges, but by watching the movement of people.

Then you get into all kinds of questions about security and privacy that we need to manage appropriately as well.

On operational technology:

IT is about data storage, manipulation, extraction, and analysis. Operational technology is all about taking and changing the state of operations.

On the changing CIO role in operational technology

The CIO hasn't had that much to do with plant automation [or] building management, but now you can't have a building manager that doesn't understand IT. So, the CIO has both a risk and an opportunity.

Who is going to manage the operational data? Are they going to come from the IT side or from the operational side? The crane, for example, in Shanghai is spitting out all of this operational data. How do you manage the safety to make sure the system is safe - these are big questions for IT guys, marketing guys, operational guys. For anybody who is looking at a broad spectrum of technology, these are big questions.

On the empowered consumer

You have got to be committed to the fact that the buyer no longer allows you to control their journey. You have to map the thing and be present where they are.

Also read:
Bridging the gap between brand promise and customer experience

On digital marketing

One of the interesting debates inside Schneider Electric is, "Do we talk about digital marketing or just about marketing?" There is a group focused on digital marketing; it's called marketing.

The default answer has to be online. The default answer has to be digital, not analog. We still spend a lot of money on events. We still spend a lot of money even on print. There are countries that still want print catalogs of our products sent out to them. We could force them onto digital but we also have to be responsive to our customers.

On brand strategy in a 175 year-old, $30+ billion, multinational company

I want to raise the visibility of the master brand, which will also increase the visibility of all the associated brands. It gives us options on what we want to do three, four, five, six years down the line.

To build a master brand across the world when we operate in over 100 countries, a company this diverse, of this size, will take years. So, I'm not focused too much on centralization. It's really, "Can I get more people to know who I am? And, can I get the people who know who I am to know all of what I do?"

Those are the two things I'm trying to accomplish. They may sound simple but they are hard to do: more reach and more depth. Those are the two things that I focus on maniacally, every moment of every day.

On in-person meetings in a social, digital, online world

We make the investment in physically meeting. Our management team meets once a month, at least, physically. Even although we are all over the world, we meet once a month.

With my marketing team, I try to use those times to develop trust when we are face-to-face. I can use remote tools to manage as we go.

Also read:
INTERVIEW: Karen Lojeski on Virtual Distance

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CXO-Talk brings together prominent executives, authors, and analysts to discuss leadership, transformation, and innovation. Join me and Vala Afshar every Friday for a new episode of CXO-Talk.

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