Bridging the digital divide at Australia Post

Andrew Walduck and Greg Sutherland discuss how digital is changing what it means to be a CIO and CMO.

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Australia Post's executive GM of consumer and SMB products and CMO, Greg Sutherland, with executive GM of trusted services, Andrew Walduck

There’s been plenty of speculation over Australia Post’s future in the face of digital disruption. Two senior executives tasked with leading the group into the new age are one-time CIO and now executive GM of trusted services, Andrew Walduck, and CMO and now executive GM of consumer and SMB products, Greg Sutherland.

Both executives see digital transformation as an opportunity for customer-led innovation and sustainable change. They also agree their efforts are challenging what it means to be a technologist, and a marketer.

Walduck and Sutherland’s roles changed in July to reflect their cross-functional leadership. Walduck, who spent the last three-and-a-half years as CIO, now oversees a portfolio which forms the basis of Australia Post’s future. Within this, he’s responsible for driving product innovation and working with customers around creating sustainable products and services.

Sutherland, meanwhile, remains CMO while overseeing consumer and SMB, a role that gives him further scope on product and services innovation and digitisation. The two positions sit on a six-strong management team.

The pair are quick to point out, however, that they’re not doing digital alone. Australia Post sees digital as the impetus for adopting new ways of working that put the customer firmly at the centre.

How does Australia Post view digital as a business?

Andrew Walduck: The focus needs to be where our customers have made decisions on how to interact with us. This could be starting on the Web, or on a third-party website, where our API or capabilities are enabled inside another organisation’s experiences. Our focus is on enabling that service to be a frictionless and beautiful experience our customers will advocate. The thing that is incredibly important to Australia Post is that we balance that with enabling great physical experiences that are consistent, and that occur at times most appropriate for our customers.

Ultimately, we are shifting from being a network-centric business that got excited by trucks and motorbikes, and which delivered to addresses, to a customer-centric business, where we deliver to a person.

Greg Sutherland: Customers are empowered, they’re equipped with a lot of information, they value service, and they can appear in any of your channels. We realise at Australia Post that we’re part of a system that together, creates a great customer experience. We have to be good listeners and drive improvements every day, but we’ve also got to look at systemic issues to drive innovation and opportunity. Traditionally, we might have built a product and then someone would buy it; now it’s about how we co-create with our customers.

Andrew, what steps have you taken as CIO to position Australia Post for a digital-first future?

Walduck: The work I’ve done to date is around fundamentally changing how our technology enables us to create products and go to market faster. I’ve also created a method of building products and services that embraces innovation, ideation, as well as how we use those concepts to disrupt ourselves and create a future that might not otherwise have been possible. For future leaders who understand technology, it’s all about how you can embrace technology to do fabulous things.

Why was it necessary to change the operational structure?

Walduck: Greg and I have joined one part of the organisation as a demonstration of the fact that hierarchy doesn’t matter in the new world. What we need to push is a deliberate, ongoing cultural change. It doesn’t matter if you’re in one part of the organisation, you can still enable the entire enterprise.

How have IT and marketing changed in light of this new paradigm?

Sutherland: The first thing is that there really aren’t two sides to this anymore. There’s only one idea about what the customer wants. Technology is interwoven into their lives and whether you’re in marketing or technology, you’re being driven by that.

As a marketing function, it’s what customers say that counts. Marketing and customer service resources are being integrated, and the teams and functions creating and delivering the experiences, such as the contact centre, Web and digital, social and post office development, are being integrated into one unit.

How is digital changing product development and customer engagement?

Sutherland: In my mind, there’s no such thing anymore between a product and a service thanks to digital, it’s all an experience that creates value for me. The major investment we’ve undertaken in the last 12 months is to double and triple down on our listening capabilities with customers. It’s also about making the idea of giving feedback a frictionless experience.

The second thing we’ve had to do is work with HR on culture to make everyday improvements with the customer’s voice as our guide. In the past, we’ve had quality improvement programs and daily operation huddles.For example, in our distribution centres, we would look at service delivery on a chart as an internal measure of delivering on time. What we’ve now done is introduce what the customers say about those services too.

It’s the story of the customer that changes the culture, not the measure itself. The current focus is building the systems to make it a scalable event.

Walduck: Through our business investment program, we’re investing in ways we do that too. When we introduced parcel locker, we changed the experience you have in the post office. When we built out our new parcel delivery networks, all of that was done by pulling together a sense of not only where we want our business to go in terms of strategy, but also the business and IT architecture underpinning that.

We have progressively looked to consolidate to a single customer record, so we have an ability to know who a customer is when they call our contact centre, when they interact with us online, come into a post office, and interact through all the channels and means available to them.

That foundation is critical. It also helps us to better know who our customers are so we can better personalise the service they then have. MyPost [app and vendor machines for tracking post] is an example of where we’re embracing this notion of personalised experience that a consumer or business can have.

What learnings have you taken away from each other to improve the way you work?

Walduck: Andrew’s the most passionate CIO I’ve ever known. He’s naturally human and customer centred, and recognises technology has to be designed for human beings.

There are similarities between marketing and IT. Within the marketing field, there is this whole idea of customer experience design, and how you ideate with divergent thinking, converging prototypes and so on. The same method has been applied to technology innovation, it’s just been under a different name – Agile, for instance. In a software and cloud-based world, the idea of how technology is implemented and developing technology products and solutions has had to change. How marketing thinks today reflects the same ideas.

In some senses, technology was further advanced in thinking in a digital space. In a service-oriented world, you have to be agile, test and learn. Being able to throw more customer information into the technology function as a method for creation and iteration has been wonderful. It’s made things faster. What technology teams haven’t completely understood is how Agile methods are more central to the operating method of a company.

Walduck: What I found in Greg was a kindred spirit who understood what technology could enable. We spend more time talking about what we could create with it to overhaul the customer experience. Greg has a depth of knowledge around customer understanding and brand, and it’s been great being part of the work he’s done around reinvention of our brand and how that can be built around having a technology heart.

While a lot of CIOs and CMOs now recognise the need for collaboration, there are still issues getting their teams to work successfully together. How are you addressing this?

Sutherland: The natural structure of marketing and technology has been disrupted. The old marketing structure was nicknamed the brand police. It was the same with IT – you’d have strategic enterprise architecture and everyone would want to do something fast, but no, it had to fit into the structure and rigour of the architecture. Striving to embed technology in the product business, which is what Andrew is doing, and embedding marketing in the channel business, which is what I’m doing, is what must be done.

Walduck: For the people further down the organisation, there does need to be change. Some of that is their focus and point of alignment. We don’t hold back from any discussion about brands, marketing, technology and what’s the right product choice to make or how we should create something for the customer. No one department dominates that discussion. That challenges some traditional norms.

What Greg has done is give us the ability to bring that customer insight in. It’s how we connect and produce great outcomes around the customer that is the unifying force. Plus we make it non-negotiable.

What you need are executives who have an ability to affect fundamental change. Some companies are appointing a chief digital officer, and maybe that’s appropriate for their culture and where they’ve come from. We haven’t gone down that route, and digital is arguably a mantle Greg and I share. The ultimate outcome is to get the organisation to not only disrupt itself, but take advantage of the opportunity that exists from interacting digitally with customers.

How has digital changed the skillsets and talent you require?

Walduck: One thing we do know is we can’t find the exact person we want. We’re spending more time on processes that help us build and invest in this capability. Through our graduate programs, we invest in certain types of capability, which brings in a lot of wonderful energy, and through our external recruitment programs we also bring in people that have a fit in terms of profile, then we grow the rest.

What innovation means

For Andrew Walduck, innovation is about having an idea, then being able to execute it in a way that realises value.

“I think many organisations are trapped in that they have lots of ideas but don’t have an ability to either execute them, or execute them well,” he tells CIO. “You need to create a learning culture where ideas are implemented, you learn, grow, iterate and then evolve to where you need to be.”

Innovation at Australia Post ranges from hack days internally to accelerate something more quickly, and in working form within 24 hours, to a more measured design thinking approach. The group is also looking into how to use incubators to accelerate certain ideas.

“It’s your ability to create and disrupt how you work which will be the competitive advantage of the future,” Walduck says. “Whether companies do that as an integrated part of their culture, or as something on the side because they fear it will be consumed by the mainstay business, organisations are now learning about their own approaches to driving change.

“But it’s not about separating digital from change. There is a new way of working that will create the success of future enterprises. This new way has to embrace creativity as a primary asset, and the human capital that exists inside the organisation.”