Kimberly-Clark’s business-first approach to digital transformation
When it comes to IT strategy, Kimberly-Clark Global CIO Manoj Kumbhat makes one thing very clear: this multinational takes a business-first approach to digital transformation.
The B2C and B2B retailer of branded personal care and professional healthcare products such as Kleenex tissues, Scott paper towels and Huggies diapers has made a major hybrid cloud push of late, complete with a Snowflake data lake, a 360-inch platform and a suite of cloud-native and SaaS applications aimed at increasing revenue from both consumer channels and giant retail customers.
But for Kumbhat, it is the business that drives the IT agenda, not the other way around.
“We are cloud smart, not cloud first,” he says. “We’re actually leading with business transformation — and as part of that, we’ve done a cloud migration.”
It may seem like a subtle distinction, but as Kumbha points out, delivering digital capabilities like revenue growth management and what he calls “consumer-inspired innovation” to drive business transformation makes all the difference.
“So many companies started with a cloud transformation and then selectively drove the business transformation. With that approach, IT is driving the change and then everyone else has to follow and it may not be the top priority for the company,” said Kumbhat, who held the global CIO post at Kimberly-Clark for nearly four years and one of the four finalists for this year’s MIT Sloan CIO Leadership Award.
Rather than jumping to the cloud to force business transformation, Kumbhat and his team “really looked at its value and made sure we don’t incur huge costs by moving to the cloud. We are smart about it,” he says of the company’s cloud strategy, which is partly focused on direct-to-consumer activities.
“We built what we call commercial transformation, which was all about the front end of our business, touching the consumer and customer,” says Kumbhat. “We’ve completely transformed our front-end capabilities to drive revenue growth.”
Kimberly-Clark’s other major customer segment, its B2B2C wholesale partners, including Wal-Mart and Target, is the other focus of its business transformation.
Using AWS and Azure, Kimberly-Clark was able to fine-tune retail revenue growth management and optimize price promotions with partners to maximize revenue growth, he says.
“We’re using a combination of technologies to build what you can traditionally think of as ‘consumer 360,’” says Kumbhat, referring to a sales and support strategy that aggregates data from across the enterprise to provide a single, comprehensive view of the customer. to offer.
The blueprint for business transformation
Kimberly-Clark began her transformation journey in 2017 with a major restructuring, including layoffs and a migration to leading RPA (robotic process automation) platforms. Kimberly-Cark’s move to RPA was very comprehensive, Kumbhat says, adding that automating supply chain and financial operations has saved hundreds of millions of dollars.
For example, as a major manufacturer, Kimberly-Clark occasionally receives fraudulent claims from distributors who were often paid due to the lack of tools to debug and automate decision-making. RPA has solved this, Kumbhat says.
“By restructuring the process and putting it on RPA, we’ve reduced the outflow back to our distributors and improved the handling of false claims as we used to receive a lot of it,” he notes.
But RPA tools and rules-based automation will only get you so far, Kumbhat says. At some point, “you need to apply AI and machine learning to further improve processing accuracy,” he says, adding that Kimberly-Clark is currently undertaking this effort as part of an intelligent automation drive.
Crucial to the company’s business transformation were several enterprise-wide IT initiatives aimed at building a data-driven and connected supply chain and a “core digital transformation,” on top of the company’s deployment of RPA, AI and hybrid cloud technologies. say.
The company is consolidating five different ERP packages across its five business units into a new single SAP ERP implementation on Azure, Kumbhat says, strengthening its data analytics capabilities to create higher levels of consumer and customer intimacy, through a customer data platform. (CDP) that provides insight into consumer spending patterns.
“Data is at the heart of everything we do,” says Kumbhat. “We’ve also gained some significant benefits from process mining tools.”
Kimberly-Clark also “does” obsolete supply chain and other business process platforms used internally in favor of the best cloud-native SaaS solutions for things like procurement, analytics, and transportation management.
Still, no transformation — business or otherwise — can succeed without convincing the people involved, especially employees and consumers, Kumbhat notes.
The global CIO, whose IT budget is approximately $450 million, has the backing of the company’s C-suite and has worked with its IT department, which consists of 1,200 full-time employees and more than 3,000 contractors, to expand the platform portfolio. and 14 “digital enablers”, including cloud, user experience, agility, team talent, AI/ML, DevOps platforms and APIs.
All of this points to an important assignment for Kumbhat: overseeing change management to ensure all employees are aligned with the company’s transformation mission.
“Every facet of our business is changing, so it’s important not to forget the value creation aspect. My focus is making sure we don’t forget the people element of change and that the organization is ready for change management,” said the global CIO. “We need to make sure that the sequence and prioritization is correct because we could have all of these digital capabilities and we want it to land in a way that is beneficial to the business – without disrupting the company’s objectives.”
And those goals revolve around improving intimacy with every Kimberly-Clark customer segment, from consumers at home to executives at Wal-Mart. Technology is simply the means to an end, says Kumbhat.
“It’s the disruptive digital that is really nothing more than building a one-to-one relationship with consumers through personalized content,” he says.