The behavior of a consumer is directly responsible for shaping the future of business. Did I say something too bold? I guess, not! The amount of evolution in consumer sentiment we have seen in the past two years is both disruptive and trend-setting. While the fury of the pandemic seems to be tapering down, and economies open for exploration, the challenges are two-sided:
- How to bring consumer optimism back?
- How to get the spending back to the pre-Covid times?
Not even one industry suffered from the stress and rigour of the slowdown and rigmarole of uncertainty and unpredictability. The consumer-packaged goods (CPG, or so to say FMCG) industry wasn’t an exception. Both from production and supply chain points of view it took a hit. But the changes that happened were dramatic and quick. Digital adoption was accelerated at an unimaginable pace. Digitization of processes, online delivery, and remote working all happened simultaneously, almost overnight.
Smruti Gandhi, Director – Community Engagement & Executive Editor, DynamicCIO (DCIO) spoke to Zaved Akhtar, CEO & MD, Unilever Bangladesh (ZA) to take the view from the top – a CEO’s perspective on digital transformation.
About Zaved: Zaved Akhtar started his professional journey with British American Tobacco and soon joined Unilever as Senior Brand Manager for its Oral Care business in 2000. In 24 years of his professional experience across South Asia, Southeast Asia and Australasia, Zaved has gained expertise in consumer-centricity, design thinking and managing innovation.
DCIO: You’ve risen from the ranks to become the CEO of a global company. You’ve seen the transition from brick-and-mortar to extreme digital. What is your assessment of the situation?
ZA: Thank you! I’d say digital transformation cannot be treated as a side business or a by-product. It has to be central to the overall strategy of an organization that is looking for growth amidst stiff competition. Initially, organisations treated it as a peripheral issue. However, today it is nothing less than a backbone, or lifeblood. Today, the digital role mandates a clear understanding of business problems and the methods to solve them. Understanding the business and its problems is pivotal to the role of a digital transformer. I always harp upon Three Elements, which are essential to bringing the transformation in the business:
- Understand the problem (both consumer and business)
- Understand Technology – the one that helps solve problems and bring competitive advantage
- Appropriation of the value chain
Digital transformation will be an easier ask if we adhere to the above three elements.
DCIO: We’ve heard a lot about the app ‘Lever Bazar’. Should we categorize it as a simple digital upgrade or a disruptive digital transformation?
ZA: Good question. We started with Lever Bazar much before the onset of the pandemic with an objective to enhance customer service. It is a self-ordering app that bridges the gap between demand and supply. Self-ordering can neither be classified as a digital upgrade nor as a transformation. But what transpired from the usage of this app was behavioural change. E.g. Prior to the pandemic, we weren’t so particular about hand hygiene. However, after the pandemic struck, we wash hands frequently. Similarly, video communications were mostly done by corporates in the most rudimentary fashion (like Telepresence or other similar ways) But after the pandemic its rampant and quite ubiquitous.
The pandemic inflicted a big shit. Everything came to a grinding halt. Stores were closed, servicing the retail stores was extremely difficult, and most importantly demand for goods and services surged abnormally. But fulfilment was a continuous struggle. A local grocery store was where the footfalls were maximum. Lever Bazar app helped Unilever to customize each and every order, connect with customers and ensure timely supplies. Technology came as a bane and also a huge disruptor. That’s why I said, it was instrumental in changing human behaviour.
DCIO: Now that we are slowly looking at the brighter side, how will customer demands change?
ZA: Most consumers are now accustomed to shopping or ordering online. It is easy and convenient and also less time-consuming. If you have observed, the FMCG industry moved from bars to detergent; from dishwashing bars to liquids. The only reason behind this was convenience and ease of use. While convenience is one dimension, the whole experience has become almost frictionless. That has altered consumer behaviour and thus the shift. It’s all very logical and here to stay!
DCIO: As the CEO of a large Multinational, what’s your future outlook? How will the shift take place from here on?
ZA: The linear ways of driving a pipeline organization will seize to exist or become redundant soon. I look at the future as ecosystem and platform-driven. Going forward, we will have Three Ecosystems:
- Consumer Ecosystem – An interconnected ecosystem where we get people to know more, try more, and buy more
- Customer Ecosystem: This is where we will generate the demand, capture the demand, and fulfil the demand
- Operations Ecosystem: A comprehensive ecosystem that fulfils the customer and consumer journey
I’d bet on two more things: Data and Analytics. They will act as the brain of an organisation from where intelligence will flow and percolate down to the last point – from top to bottom.
If we have to arrest growth and be futuristic, the data has to be exploited well. We need to get rid of data silos. The opportunity is identified when we understand the overlap between the shopping basket and the trade basket. Mass marketing, as has been done traditionally, will become counter-productive. A dramatic change is beaconing and that’s called hyper-personalization – serving customers in an extremely personalised way. However, it is an uphill task. It needs an extremely high level of operational capability that results in good service.
The future of FMCG will solely depend on how it harnesses the power of skills, along with the ability and agility of a start-up. And this will only happen when you can harness the powerful data – not in silos but as a whole.
DCIO: As a CEO how do you think businesses should act or be prepared to adjust to the rapid changes? How do you see growth being addressed in the next decade?
ZA: While there isn’t one silver bullet and every industry has to address this in a unique way however, some general fundamentals to remember are as follows:
- Have an experimentative mindset: Experiment-fail-improvise-succeed
- Don’t have the ‘fear of failure’ mindset: Failing is not bad as long as it gives you the right lessons
- Transform fast: Don’t wait for others to jump on the bandwagon; you’ll be late
When speaking about success factors for growth, I look at it from the following four dimensions:
- Grow competitively
- Grow profitably
- Grow consistently
- Grow responsibly
Measure your success basis the above 4G Framework. When you deliver, you win and make a difference!
RAPID FIRE WITH ZAVED AKHTAR
|One thing that keeps you awake at night||Nothing|
|The book on your bedside table currently||Noise: A Flow in Human Judgment by Daniel Kahneman|
|One word to describe you||Calm, Composed|
|If you had to invite any three people to your place for dinner, who would they be…||· Dalai Lama
· Peter Senge
· Indra Nooyi
|One CEO you admire||Sanjiv Mehta, Chair and Managing Director of Hindustan Unilever Limited (HUL)|
|One initiative that you think the company could have taken earlier||Sustainability|
|The next big thing in your industry vertical||Web 3.0|
|Your leadership style||Collaborative, Performance-oriented, & Accountable|