Future of Digital Transformation – Ranjit Tinaikar, Ness Digital Engineering

This is texturing TV. Love the great pleasure today of being joined by Ranjit taniker. Who is CEO of Nest digital engineering.

Welcome Rajiv. Great to be talking with you great to talk to you to a match. Thanks for having me you bad great to have you as we were just catching up a little bit before talking about NASCAR's.

I remember you all from when I worked in the cable and the video side of the industry, but it's a much different world. Tell us a little bit about yourself. Tell us a little bit about Ness and we'll get into digital transformation.

Sure, my pleasure. So Ness has been around for a long time. We we were founded in Israel in 1999.

And we've done one thing really well throughout our life which is built proprietary for software products and platforms. And and I'm sure at some point in your life. You must have touched upon a or interacted with the pieces software that nest on the nest Engineers have built if you were to go to a Hilton hotel room the video streaming software in your set top box is probably built by us.

If you were to take a mass transit system in London or Arizona or New York or Bangkok the automated Payment Systems total fires. God forbid if you want to go to a hotel hospital and do a CAT scan. There's a good chance that the diagnostic imaging systems will build the pieces of court that we built so we have been around for a long time and hopefully these these Examples give you a sense of the kind of what we do.

These are very sophisticated pieces of software built by very talented software Engineers that you don't find very easily around the world. And so that's so true, especially now. Yes, you know, let's talk about digital transformation and not a new term and you know, I've been kind of living this for a while, but I think it a business strategy how we leverage technology imply.

These things have changed a lot. I mean our worlds have changed whether it's you know covid or warn Ukraine or move to the cloud and SAS or I mean you can you get a list the Technologies right? It's really more how we think about that a strategic level at a board even a board or executive level and drive the business from it agree.

I mean this is this is a topic very close to my heart Mitch because I I fundamentally believe that the promise of technology has been sold to management teams and more. By Consultants by academics and the technology vendors for the last 30 years and not without reason they have had it but if you go through all those lessons to learn there's one thing that is always calm. And the common lesson learned is of course technology and and using the best of technology and having the talent to be able to build it and deploy it is critical it's necessary but it's not sufficient and more often than not is the other stuff the management culture the mindsets the processes the way we run our businesses that comes in the way of successful digital transformation.

And and this new type of digital technology by which I mean Cloud massive data processing platforms machine learning and AI these Technologies are just hyperacillerating the level of transformation. You can produce in a business. And therefore the barriers to that transformation are also hyper accelerating.

So I wanted to talk a little bit about those when you talk about the first one I think is just the way we manage our businesses financially their build on the annual budgeting cycle. Transformations cannot be made slave to the annual budgeting cycle and very often a transformation dates to the three to four years sometimes 10 years. I was talking to the head of a large one of the world's largest Automotive manufacturing company.

And they are looking at electrical weights and they're going to rapidly transform this whole industry now. the auto dealerships of this company are in the range of making 70 billion to 80 billion euros. every year a large portion of that comes from after sales parts and service.

Well, you don't need that for EVS. So what are you gonna do with these businesses the transformation that that dealership has to go through to come up with new sources of revenue like leasing financing our subscriptions and so on and so forth will not come in one quarter or one annual budgeting cycle. You have to take a penny and the discussion we had with them was how can we work together for the next 10 years, right?

That's doesn't happen very often. The second is around commercial risks. There is a reason why Innovation is hard it's not because people don't have good ideas.

It's because very often and Innovation means sometimes cannibalizing your existing products and your businesses and very often. You're not ready for that. So I used to run a fintech business.

We came up with the new product platform and we wanted to take it to our customers. But guess what these customers were using our own platform for 15 years. Now, I go to them with my new fancy product.

They say, you know what raunchy I really like to use it. But if I'm going to incur the switching costs of going from my old platform to your platform the might as well issue an RFP and see what's out there and now I've increased my Revenue rest, which you wanted to hear. So it's you know commercial rest is the second one and I think the third one is ecosystems the digital Technologies of fundamentally transformed the way the engage customers as well as suppliers, the traditional boundaries between your business and my business along the value chain have been destroyed.

Now a traditional Enterprise has problems even coordinating within the Enterprise between the product team and the sales team and the customer service team. Well now you talk about can integrating with the customers distribution arm or are the suppliers and that's where a lot of these digital transformation programs have limitations in the way they get executed. So I feel like digital transformation is not a technology problem.

Only it is more importantly in management culture a business model and strategy problem. I really like the way you've broken it down. And for a couple of reasons one is No plan is static.

Remember, like every plan is wrong. As soon as you hit the save button, right or you don't even hit the save button on some some apps today. But you're you have to constantly change.

I mean you may acquire a company you may acquire the technology that you're planning on building or buying or whatever or you know sell out part of the business or you know, who knows what's gonna change, you know, it will change that's the given fact so I think the ability to react and sort of sometimes adjust sometimes rethink sometimes restrategize. Yes about how we go and you know where we're going with our transformation. The other is you mentioned the auto, you know dealers.

Nobody knows what that model really looks like until you get into market and try it right and you start to do things and you know, they'll discover this doesn't bring us in enough revenue and this does and we we pivoted to that and they're gonna of course correct a bunch of times so you can't plan for what the answer is you can plan. For heading down a path and being able to adjust with it. And yes the Technologies there to help you and maybe enable it.

Maybe it's maybe it's a key strategic element of it, but it's no longer, you know, if we just by the next side base Oracle database based whatever, you know Erp system. We've got everything we need we know that's not the right answer. We those products are fine, but it's not a single Silver Bullet.

Like I think we sold a lot of technology to our border and I think you instead of very well amid, I think strategy is never really about it's a constantly so long as you know, what your end goal is and what your Innovation is, then as the world changes you can always adjust your path to get there. Mm-hmm, you know, and somebody else you mentioned is the systemic nature of The environment we're working in the ecosystem right another way to say that I mean, I mean I might believe about Supply chains is it isn't about rebuilding and it's about continuously rebuilding them. I mean you have to do that right now, who knows maybe we'll end up in a fairly stable situation again where we can rely on certain suppliers.

I just don't think that's the near term certainly in the next three to five years. It's an interesting one and I have, you know be out of tech services for so I have an interesting Vantage Point into the tech balance supply chain, and of course it's been distracted. Has been disrupted by covid and has been disrupted by the Ukrainian crisis and it is location of demand across many companies and and there is a price to pay for that.

Of course, you know a number of companies have not been able to give their products out to Market fast enough and capital has been constrained in the late flows across all these opportunities. but I I think something good also has come out of it. Um, and and I can I was just this morning talking to somebody said that this whole work from anywhere is here to stay now.

Mm-hmm that totally changes the way we do business. Oh, yeah, right you can have a team which is 25% in east Europe. 30% in USA and you know the rest in Latin.

And Technology can make it all seamless because guess what? You know what you and I could be right now sitting right next to each other in the other room. Or we could be in different ends of the continent and you would not know.

It's you know, I do I do a show called cisotalk and we've tracked a lot about how the role of the ciso shifted from. This is what I'm designing protecting building Etc to I'm Outsourcing all that my corporate Network inside. My building is run by somebody else that looks just like the Starbucks Network or the whatever because what's the difference?

Right? I mean, why should I have one environment that looks you know completely different from every hotel and restaurant and you know Park Venture whatever you might be in I've got I've got to be able to design it for Indian location, right? That's a different mindset different model.

So true it's gonna be a fascinating World Mitch. I really think the next five years. in fact, you know, I was gonna say given all this change and if you look at the current macroeconomic environment I have actually enjoying this macroeconomic uncertainty because I think it's gonna take a little bit of the frog out of the market and and when the type recedes I think will be left with companies that are really solid and actually are value creating in the way they operate.

Um and the discussion around cybersecurity that you mentioned is an example of that. I think we have to take that very seriously, but we have to take it in a way that is cost efficient and smart and if you do it the right way. I think you know you you'll serve you well in the years to come.

That's interesting that we kind of getting into these runaways chain reactions right where it's just you know, it builds on itself evaluations get crazier and funding models get interesting and and once in a while, I mean it eventually will reset or whatever that is. I mean just picking on investment side of it but it's it's sort of like they're trajectory. We were on before covid right before lockdown and that, you know, boom everything changes and yes some things go back some what but a lot doesn't it's and my belief is you can't change a fundamental component of a system and expect it to return back to its previous stable state.

It won't it's not possible. So you change enough elements like this and that you have a lot of disruption, but that's where the opportunity is Right project. Totally I mean, yeah changes there was there's a story about the newspapers over the last 150 years every 50 years.

Somebody comes and says well look at this new technology the telegraph or television or whatever the internet and the newspapers are going to die and and actually it's just became different and what effective at every stage and they're still here you look at Jeff Bezos. He's completely Reinventing The Washington Post and it's personalized news and it's vital news and it's different type of needs. So I feel like changes always an opportunity.

If you want a good business. But I'd love to have you back because we could explore any of these areas. And we do a lot of work on digital Transformations, especially it's the cxo level two.

So hopefully you'll come back and join us. We'll kind of go down a few of these. Yeah.

That'd be great. Well, thanks for joining us today. Ranjit is CEO with Nest digital engineering.

We'll talk to you again. Talk to you. Thanks.