Resilience in a Post COVID-19 World: Interview with Peter Coffee

In today’s interview, we are very happy to have Peter Coffee, Vice President of Strategic Research at Salesforce, on board with us! Peter works with global IT and business leaders on a daily basis to define opportunities in Salesforce’s evolving App Cloud portfolio of cloud-native platform services. Enjoy the feature!

Wan Wei: Hello Peter! Would it be okay to start with a definition of digital transformation and how it differs from digitalization? 

Peter Coffee: Absolutely.

I’ve sometimes said there are only two things wrong with the phrase digital transformation. One of them is the adjective and one of them is the noun. Because the adjective digital makes it sound like it’s about technology acquisition. And that’s really just the enabler and transformation sounds like it’s a step change where you go from one state to another state. Now you’re transformed and so you’re done. 

Among the important things to understand is that adopting the technology makes the transformation possible. It is not the transformation itself, but by moving your processes to a point where they are connected and instrumented and capable of having machine intelligence injected into them. 

You make transformation possible, but the actual call for all change of a company to one that is continuously transforming, to a culture of engagement with the customers and the degree of customer involvement in the definition of what the company does, these are fundamental management and leadership challenges. 

So, many people use these words in different ways, but I think of digitization as sounding to me like the adoption of the technology, all digital transformation is much more about behaviour. And even the fundamental definition of what is the business model, for one example, was a company called Illumina, which began life as a developer and manufacturer of gene sequencing equipment. 

But early in their development, they realised that the diagnostic network connection on that gene sequencer could also be used with customer permission to start building a comprehensive database of genome information, pivoted in a dramatic way from merely selling the the equipment to actually becoming the curator of what rapidly grew to one of the world’s premier databases of gene sequence knowledge. And that is a genuine transformation for, you realise you have the ability to move from a provider of an object or a performer of an activity into a curator of a community that grows far more than linearly. 

The term exponential growth is often overused, but you do get literally exponential growth in a situation like that. That’s what digital transformation is really about, in my opinion. Now, I sometimes break it down into four components:

• One is becoming connected, which is a technical accomplishment, making sure your products have sensors in them and have some kind of network connection capability.
• One is becoming more aware, if you want people to share their data with you, you have to reflect that data back to them with value added to it with things like frequent customer programmes and customer communities that can collaborate with each other.
• If you want to be connected and aware, at massive scale, you’re going to need the leverage of machine intelligence, whether you call it AI or machine learning or predictive analytics or big data, you know, there are many different bubbles within that cloud. 
• And then finally, if you want to be connected and aware and smart, and have it actually worth anything to anybody, you also must be trusted because the kind of data that’s now being collected and used, it’s not transactional or financial. You can fix a financial mistake with a financial remedy. write some on a refund check or whatever. This is the kind of data about health and lifestyle and personal activities. 

If you look at our pandemic response, the need for contact tracing disciplines that will be asking you questions like, Where have you been? Who have you been with? Have you been showing your medical symptoms in the last 24 hours? These are very sensitive kinds of data. And so, maintaining and sustaining a trustworthy posture is gonna be absolutely necessary. 

So connected, aware, smart and trusted, which in English spells out the very convenient acronym CAST and there are all sorts of great puns available, you know, casting call broadcasting whatever, but this is how I break it down because 

• Connection is the job of the CTO and the CIO; 
• Awareness is the job of the business unit leader; 
• Smart is the job of the research department and the scientists; and
• Trust is the job of all of the management from the top down. 

And that way you have action items for the people who report to the CEO. You can say here, here’s your task, here’s your task, here’s your tasks, put these all together. And we will have the capability of digital transformation. You’ll notice that if you miss any one of them, the entire thing falls down. You’re not connected. There’s no way to bring in the data. If you’re not aware, there’s no reason for people to give you the data. If you’re not smart, you can’t digest the data at scale. And if you’re not trusted, then no one wants to have anything to do with you involving data or smartness or anything else. 

Wan Wei: So, we noticed that Salesforce has like two initiatives. One is work.com, the other Salesforce Anywhere. Tell us a bit more about these interfaces and how it could help companies with digitalization or digital transformation. 

Peter Coffee: I get asked a lot about this question about where are we going from where we are in terms of the global response to the present pandemic, which is not by any means the first pandemic. It’s not even the first recent pandemic. It’s just the first one that really hit North America and Western Europe hard. 

I mean, Asia, there’s kind of a, you know, what, have you seen this before? The questions includes, what do we do in the next few weeks and months, and what should we understand are going to be persistent effects that may last for years or may indeed last indefinitely. 

If you want an example of a change that sticks try to remember what an airport looked like before 911. When you could walk into an airport and walk to the gate to meet people coming off the plane and you know, there was just like free traffic in and out of the airport up until the moment you got on the aeroplane. 

And then after 911 all of this changed and now no passenger going beyond this point, I don’t think we’re ever going to go back to the pre 911 Airport. And I don’t think we’re going to go back to the pre COVID-19 workplace or university or hospital, I think we’re gonna have some permanent changes in the way we manage the boundaries of these locations. So in the near term, the reopening we need to understand that the pictures you see of an office with the desks now farther apart, the partitions everything else. That’s just architecture, that’s fine furniture. It’s important. 

But the difficult problems occur at the boundaries in the lobby where you can’t have all of the people beginning and ending their workday arriving and departing at the same time. You can’t do that anymore. You can’t have a full elevator in a high rise building, and so active management of the boundary of asking people the night before, have you had any symptoms That would all go against you coming into the office tomorrow. Here’s your 15 minute time slot for your arrival tomorrow. Here’s the activity of expected visitors coming and going during the day. And we’re going to manage that.

 At no point is there an unacceptable congestion in the lobby or the elevators that is necessary to a reopening that actually works? Because otherwise you have your office perfectly designed but you can’t bring people in and out of it without danger so that’s that’s the reopening question.

And that is very much what work.com is tailored to do– we build a control centre, in which information about health hazards management of the breaking up of your workforce into shifts and teams setting one team that has a medical outbreak, only that piece of your workforce now needs to go on shutdown. Work.com is very much about active management of that boundary. And of the team and of the visitors so that the reopening can happen. 

Now Salesforce Anywhere is largely about this question about what are the durable and persistent changes in the way we work and live going forward. Many people whose managers might in the past have said, No, I really need you in the office, I can’t have you working from home, there are now going to be able to look their manager back and say, I’ve been working from home for the last three months, you really can’t credibly Tell me anymore that I can’t do my work from anywhere. 

And building tools of collaboration and sharing that are secure and capable, as well as being convenient is an area where there’s some improvement to be made. We saw enormous improvement between the period right after the global financial crisis when many people tried to cut back on travel at that time television conferencing technology was not good. It was not. It was, you know, the bandwidth was limited. 

Try to remember that in 2008, 2009, the iPhone had only barely become a 3g device. You know, the quality of the communication services just wasn’t out there. And I think many people who lived through that period came into this period, nervous about work from home or work from anywhere and discovered, oh, wow, this is just a whole different work. The the quality and capability of the services is so much greater. So I think one of the durable changes is that we’re going to go through this tunnel, and when we come out, you’ll go to the office when there’s a need for you to be in the office. 

When you’re meeting with a group of customers. you’re conducting some kind of training activity, but I think the default is going to be well yeah, you’ll  dial in for that. And so Salesforce anywhere is very much about equipping this new environment where it’s not about email and video conferencing as substitutes or as you know, mere connective tissue among, quote, real work, unquote, the real work is going to be all the time everywhere. 

And generally speaking, I think people are going to be more productive, healthier, and companies are going to discover that many things can be done that substantially lower cost, even with superior productivity and superior results. I think that’s a tremendous opportunity for many of us individually and as organisations.

Wan Wei: Are we getting that right–What do you think? How do you think these changes would remove any psychological barriers to organisation or management when it comes to digital transformation?

Peter Coffee: I think it’s not so much making more companies want to do it as making more of them. Recognizing the necessity of doing it soon, many CIOs have said to me that everything they’re now being asked to do in the next two months, is something that they had been discussing doing over the next two years. 

And I just saw a comment from someone at L’Oreal talking about how, for example, they’ve implemented tools for people to do trying on of makeup, over an internet connection, something you would use to do in a department store at a counter with someone you know, helping you test out new colours and things now you can do that virtually.

And if I remember correctly, what you said is we just got done in eight weeks what would otherwise have taken three years. Joe McKendrick said the best way to look at this is to say 2025 got here sixty months early. So it’s an acceleration of things that were clearly underway, but a tremendous acceleration under the pressure of urgency. 

Now the challenge is to avoid letting that urgency become a wedge that brings insecure and unscalable methods in the Latin phrase ad hoc, meaning to the moment, someone said, Don’t let your ad hoc become bad hoc. Don’t let the thing you did in a quick and somewhat sloppy way, because you had to do it right away. Don’t let that become permanently embedded into your practices, and then be struggling to deal with the insecurity or struggling to deal with the roughness around the edges and definitely think about the things you’re doing. 

From the point of view of, “Okay, we’re not adopting this as a temporary measure to get us through this. We’re adopting this as a new way of engaging with our customers and coordinating our teams. We’re adopting something we’re okay with planning to keep around indefinitely. “

And if you do it with that lens, on the way you look at that, you’re off to build solutions that you’re going to be happier to have as part of the way you live and work for many years to come.

Wan Wei: So, what is the one tip you would give to companies to have that long term mentality instead of like the medium term or the short term?

Peter Coffee: The most useful way to free your mind you remember the phrase from The Matrix, you got to free your mind, you got to believe that you can make that jump, if you want to make that jump. Among the most useful ways to free your mind is to try to forget the thing you’ve gotten good at doing, and dial your brain back to the reason anyone wanted you to do it in the first place. 

For example, you might say I’m in the restaurant business, and I am existentially threatened because no one wants to go to restaurants anymore. Well, why did people go to restaurants, people go to restaurants to enjoy a kind of food they don’t know how to prepare for themselves or to enjoy and especially Experience wrapped around the meal. And there’s no reason why I can’t deliver someone an exceptionally interesting meal or even a special experience wrapped around it in the form of something that they can enjoy in their home. 

You might say, “Well, people want to have a picnic on the bank of the sun in Paris. That’s what makes going to France so special.”

Hypothetically, I could have someone arrive at your front door with a picnic basket. And, and a few other little, you know, things that let you have that dinner on the bank of the sun in your own dining room. 

I could do that. Is that scalable? Can it be done efficiently, we’re going to get pretty good at that kind of thing. And if we remind ourselves, I’m not in the business of setting a table and putting a meal on it, because that’s not a high value business. I’m in the business of providing an extraordinary experience anchored around but not limited to a meal and then Say now how do I visualise what that experience looks like in a post COVID-19 world? 

That’s just one simple example. And when you ask yourself, not what’s the thing I’m good at doing or the object I’m good at making, but what’s the need that I’m really needing? And then ask yourself, how is that need met in the world, it’s very, very rich in connection and computation, and maybe a little less rich in mobility than it used to be. 

So it’s a shift. It’s not an amputation of a limb, it’s that you know, now your arms have gotten stronger, maybe your legs are a little less strong, so you do different things we will accommodate with it’s not, it’s not a threat to anyone who’s capable of remembering with some degree of imagination, why their business exists in the first place. 

The problem is, I rarely say “the” problem. Usually I say “among the problems”, I’m going to say the problem is we’ve spent 20 years educating managers and organisations to do relentless narrowly focused optimization, minimise cost, tighten supply chains. We built fantastically narrowly optimised solutions that turned out not to have much resilience in the face of change. 

People were not rewarded for creating flexibility. They were rewarded for minimising slack. They were rewarded for trimming away anything that wasn’t clearly needed. That’s what the rewards were given by the stock market but, you know, companies who got promoted and companies, the people who found quote, efficiencies, unquote, not people who found resilience. 

I think if there’s one thing we’ve seen in the last few months, it’s that being good at creating resilience is more valuable maybe than some people recognised. You can see this frankly in the behaviour of the markets because privately held companies in which a founder’s vision was usually driven by a passionate interest in a need that needed to be met. 

And they didn’t have to answer to investment markets or shareholders who are constantly asking you, “Well, how come we can’t get the costs down?” 

But they were really able to drive a value proposition. You look at someone like a recreational equipment maker, like a Patagonia for example, which has that advantage of being driven by a vision of the needs they meet. They’ve turned out to be in an excellent position to continue to fulfil their vision, even in a dramatically changed environment.

Wan Wei: How is it possible to measure resilience? As you mentioned, one method is through the vision and how consistent the company management is with the vision. Are there any other methods? 

Peter Coffee: One of the key methods for building resilience into an organisation is to adopt a discipline that is sometimes called scenario planning. 

I think many people attribute the real amplification of this idea to a gentleman named Peter Schwartz who in fact now works with us at Salesforce. Forecasting takes the state you’re in and extrapolates forward to say, Alright, here’s what’s probably going to happen next. And then you put some error bars on that maybe do some hedging of your risk, and you’ve got a most likely outcome with some flexibility on either side. And that’s what many people think constitutes responsible planning. 

Scenario analysis takes a much wider view and says, what are all the foreseeable outcomes, not not the wildly speculative ideas, but things that might be low probability, but could happen. 

If you walk into a casino and you walk up to a roulette wheel, and you bet equal amounts on red and the black, the next spin will almost certainly come up red or black. And they pay one for one. So whichever one last you take the winnings, put it back on the one that you know that that lost and now you’re back where you were, you’ve hedged your risk, and you think you can go on this way for a long time. 

The problem is that once in a while, a green slot zero comes up. And if you put all of your money on red and black, you’re wiped out completely and now you’re out of the game entirely. The green ball was a low probability, you will never forecast that zero. But it is a scenario. It is plausible. 

And you should have maybe an extra you know hundred dollars in your pocket to keep you in the game when it does not occasionally happen because in a US casino where there’s both a zero and a double zero. If you spin that wheel 13 times, there’s a 50% chance that you will get at least one zero or double zero. That nuts you know, not a lot of spins. 

And so the important idea is, look at not merely the most likely thing, don’t look at your forecast, but evaluate the scenarios. To use an example from the other side of the planet where you folks are right now, someone in Mumbai once said to me, “Look, you don’t know the date when the monsoon will happen. You don’t know if it’s going to be a bad year or a light year for the monsoon. But when it comes, you should have your umbrella ready. You don’t go out and buy your umbrella, the day the monsoon happens because that’s just poor planning. But when the monsoon is over, you don’t throw the umbrella away. You dry and you put it away, you make sure it’s in good repair and it’s ready for the next one.” 

That’s what scenario planning is. I don’t know what I’m going to need it for. But someday I know I’m going to need it. So I’m going to have it ready. And that’s what resilience is all about is having considered the things that are likely to happen eventually, and making sure that none of them is going to destroy you. When it eventually does come. That’s, that’s what resilience is really about. 

The problem is it’s not what’s taught in the business schools. Business Schools is relentless optimization. And, you know, and prediction and the more right you were about the prediction for next year, the better a job you did, and the people who spent money on things that didn’t happen are not held in high regard. Well, that way of thinking didn’t work out well for us and stuff.

Wan Wei: That is something new to me, actually. Yeah, this I mean, off my head, resilience does sort of work like the discipline of public relations, it sort of works like “insurance”. 

Peter Coffee: If it’s just a matter of time before something happens. Is there some good reason not to have a binder on the shelf that you can pull off the shelf and say, oh, okay, yeah, we got a plan for this one.

Interestingly enough, there is a point regarding pandemic response when I talked about this, I actually ran across someone who said, Oh, yeah, after after SARS and mirrors and some of the others, we wrote our first pandemic plan in 2006, updated in 2009, updated again in 2014.

And they had a pandemic response plan ready to go, they knew they were going to need capability for virtual private networks. They knew they were going to need certain things they, they didn’t have to ask, what do we do? They knew what to do. They thought this through. 

Some of them, though, had the unpleasant discovery, that having your own perfect pandemic response plan is completely inadequate. Because if your customers weren’t ready and your suppliers weren’t ready, and the city in which you are operating wasn’t ready, then you’re perfect readiness is almost useless to you. You’re a little bubble of perfect readiness in an ocean of not being ready for it. And that’s just not adequate. 

So sometimes you have to say, are we sufficiently ready, that we should now be investing at the margin in educating our customers, or maybe making investments in our suppliers or making investments in community response so that everyone around us doesn’t let us down.

And that is, again, a way of thinking that has not been encouraged and rewarded in the business community, which has been very much about, you know, what do I do for you to take care of myself. And the idea that you invest in the community around you, not because it’s the nice thing to do, but because it’s the smart thing to do. 

And that’s something that I think is an awareness that might last for a while coming out of this because really, once we get through this particular pandemic, the recognition that pandemics happen. I think it’s gonna be with us for a long time.

Wan Wei: Yeah, and I thought I like the way you say it. Do you think we are moving from a model of financial capital to a model of social capital, when there is this increased emphasis in giving back to the community and ecosystem? 

Peter Coffee:  If you don’t if this is something that the famous conversation between the head of the Auto Workers Union and Walter Chrysler when they were going through one of the factories, and ultra Chrysler was pointing with great pride to the robots, and the head of the Auto Workers Union said, maybe but none of them is ever going to buy your cars. 

You know, if if you if you haven’t nurtured a community of suppliers and customers, then of what value is anything that you’re able to do your factory is valueless, if it cannot get the materials it needs and if it has no buyers for the things that are built, and so making these investments all around you is is just good business.

Wan Wei: Peter, what is the one myth that you have encountered in your whole career when it comes to digitalization or digital transformation?

Peter Coffee: I think the single most dangerous myth is that the technology will tell you what to do with it. And if you look at every important technology of the last 10 or 20 years, you’ll see that the first thing it was used to do was imitate the thing that came before. 

And the web page initially was just a page of your paper catalogue only now you’re looking at it on a computer screen. And then they made that interactive. And now it started to look more like a form you were filling in. But again, it was still really just re instantiating that paper based model, but doing it on a screen. And now what we really want is to just walk into a room and say to the room, this is what I need, or better yet have the room say, oh, you’re home. You’re home early. Um, what would you like for dinner tonight if you want the example of what people want? Just go look at any of the Iron Man movies. 

When Tony Stark walks into his home, his computer, Jarvis greets him and offers him options. We’ve gotten to the point where we started with command lines where you had to know what you could ask for. And then we had menus where you had lots of things and you’ve had to make a choice from the menu. But now what we really can have is systems that proactively offer us what our past behaviour and present circumstances suggest we should want. But moving there doesn’t just happen. 

And the challenge that’s been most often presented to me by Salesforce customers, is to remind ourselves at Salesforce, we understand what this thing does, and we’re sometimes unprepared for the need to bring people along with us and say, maybe you didn’t realise this. 

Here’s a perfect example. If I were to sell you a chainsaw, you know, a gasoline powered, you know, software for cutting down trees. You might come back a week later and say I don’t understand this thing is bigger and heavier, and it doesn’t cut any better. And I’ll say, What’s the problem? And you’ll say, I don’t know. And I’ll start the engine on the saw. And you’ll say, What’s that noise? Because no one ever told you that to use a chainsaw. You have to turn the thing on. You took that chainsaw and you started doing this with it. Like any other saw. If you use it that way, yeah, we’ll cut down the tree, but you won’t understand what the big deal was about. Because the idea that well, it has to be used in a different way. 

If I if you’ve never seen a screwdriver before, and I hand you your first screwdriver, you’ll take it, you’ll look at the handle and you use it to start pounding a nail with it because that’s what you know how to do. And I say no, no, no, you use the other end. You look at that end and say I don’t get it. It’s got this flat tip and I’m looking at my nail on my nail has no slot. You’ll say no, this is a screw there’s so many pieces. You have to explain the relationship of the pieces. 

So the biggest myth of technology is that if you can sell someone the tool, the tool will tell them how to use it. 

Wan Wei: Is that why Salesforce has Trailblazer?

Peter Coffee: Yes, we realised this a few years ago is that people were saying, your tools are amazing, but I don’t know where to find the people who really understand what to do with them. And typically, technology companies have relied on third parties to go out and sell training. They have gone into the training business because, frankly, the training business is a very low margin business compared to the technology industry. 

I mean, the training business looks like a very labour intensive business, which is very difficult to maintain high quality, but that’s what we did. We did not go out and hire cadres of trainers. We built a modular, self paced gamified learning platform. That we can deliver with the same efficiency and scale that we deliver our business solutions. And it turned into this amazing trailhead community that does not just teach Salesforce skills. We use it internally for all of our management training. 

We have made it open to universities, we have badges from management schools and from other institutions that have contributed into the platform. And then of course, the way Salesforce does, we turned it not just into a product, but into a platform that our customers can use to their own needs. So you can get a thing called my trailhead, that you can then populate with the content you want to use. Because what people said to us is, our ability to get maximum value from you, doesn’t need you to make it better. It needs you to build us a workforce that knows what to do with it.

 And so we made a strategic investment in creating not just a training operation, but a whole new platform that has been adopted with tremendous enthusiasm, not only within our own company, but by our customers and by universities and by other institutions who say, finally, finally, we’ve got something that can let us have training at scale, in a manner that’s convenient to people that can consume when they have the time wherever they are, runs on your mobile phone. That’s, that’s a digital transformation of education and training. 

And when people saw it, they wanted to, this is something that Steve Jobs was famous for saying is that I’m not gonna I’m not gonna have a focus group focus groups won’t tell you what they want. If they’ve never seen it before. They won’t know what they want until they see it. And so often, that’s the case if you ask people, how can this be better? They’ll tell you how to improve the thing you have. Generally speaking, they won’t describe something they’ve never seen before. They won’t. They won’t Give you an idea for a breakthrough. Ideas for breakthroughs generally don’t come from asking the users of the existing thing what would make that thing better? They come from really dialling back to the question of what’s the problem being solved here. 

Another example of Steve Jobs’ example again. When the iPod was first introduced, there were many companies making mp3 players, digital music players that was an established category in the marketplace. My friend Ray Wang says that there were three different divisions of Sony competing against each other to sell mp3 players. And Steve Jobs said mp3 player is not a product. mp3 player is a piece of a solution to what people really want, which is the music they like, available for them to enjoy wherever they want to have. And he did something that many people assumed would be so difficult that they just dismissed the idea of out of hand. He went to all the records companies and essentially got every one of them to be afraid that the others would do it and they wouldn’t. 

So they all came in and started saying, okay, fine, we’ll sell you, we’ll sell you the rights to distribute our songs at 99 cents a song. And this solved the problem that the mp3 player industry had not solved, which is convenient, affordable access to quality music, legally. So iTunes plus iPod was a solution to the user problem while an mp3 player was merely a product. And if you want to know how well it worked, three years later, the Oxford English Dictionary entered a new word into the dictionary podcast. We didn’t call listening to stuff on the internet, a podcast before there were iPods. The iPod literally created a new vocabulary for discovering and using internet content. That’s how well it worked. But it worked by solving the problem Not by improving the product.

Wan Wei: So defining the problem is really important.

Peter Coffee: Yes. There are so many examples. Actually my former colleague, Dan Debow came to us through an acquisition, he’s moved on to other opportunities.

He once said, If you fall in love with your clever solution to a problem, you might have one amazing success. If you fall in love with the problem, you can have an unending string of successes. If you’re in love with the problem being solved, then a better way to solve it isn’t the enemy of your solution. 

It’s your next opportunity for greater success. Fall in love with the problem.

Wan Wei: How do you surround yourself with such smart and inspiring people?

Peter Coffee: I listened a lot. Okay, the good old version is that talent imitates but genius steals. Yeah.

Wan Wei: Okay, so before we end this interview, do you have any last words to add?

Peter Coffee: I’ve been fortunate for the last 13 years to have a licence to spend my time in places like Singapore and Spain, and South America and Western Europe. And just to see how universal certain goals and desires really are, and the differences that people think they see those are those are details around the edges. People want to be confident that they’re getting a reliable solution to a problem they have from someone that they can trust. 

The belief that you have to compete on price is misplaced. It’s been shown again and again and again, that when someone is completely confident that the price they’re being charged is a fair price, the same price that we charge to anyone else. People spend more more quickly and are happier with the result. 

And so I’m fundamentally convinced that a focus on delivering greater value ultimately makes more people happy, then relentless desire to deliver the lowest cost, and that a readiness to admit that you aren’t exactly sure what’s going to happen. 

You’re going to make some investment around the edges and being ready for the unpredictable, not the unexpected, but the unpredictable is ultimately going to be the greatest guarantee of success.

Wan Wei: Okay, great. Thank you so much for your time today, Peter.

Peter Coffee: It was a pleasure. Thank you for the opportunity.