The health and fitness industry has so far missed the opportunity to use customer analytics embedded in a coherent digital journey to understand behaviours, motivations and blockers. Not for much longer. Andy Caddy has been busy redesigning Virgin Active health clubs around a connected digital experience that will offer the company opportunities for engagement and a closer relationship with members.
Group CIO Virgin Active.
When did you start your current role?
What is your reporting line?
Do you meet with and discuss business strategy with the CEO every week?
Are you a member of the board of directors?
What other executive boards do you sit on?
Company executive board.
Does your organisation have a CDO?
What non-technology responsibilities do you have in the organisation?
I own group digital strategy and work with local CMOs to implement it.
How many employees does your organisation have?
Does your organisation carry out significant trade in the EU?
What number of users does your department supply services to?
How do you ensure that you have a good understanding of your business and how your customers use your business's products?
I regularly spend time in our clubs, usually once or twice a month. It is critical to get a frontline view on how services are being delivered and the challenges our staff and members face.
Virgin Active technology strategy and agenda
Is your organisation being disrupted by the internet, mobility or technology-oriented start-ups?
Are you empowered by your organisation to disrupt from the inside?
Describe a disruptive measure you’ve led or played a major part in
I'm working with our property teams to redesign health clubs around a connected digital experience. These connected clubs will be technology flagships for the company and the first two open this year in London. This hasn't been seen before and offers us opportunities for engagement and a closer relationship with our members.
What major transformation project has been recently completed or is under way at your organisation?
The replacement of our legacy core membership and billing systems was initiated in Apr 2014 and will complete in April 2015. This has rolled out new systems, hardware and more importantly simplified business processes across our 101 clubs in the UK. Europe will follow later in the year.
What impact will the above transformation have on your organisation?
It delivered a simplified set of business processes by using the implementation of a single, enterprise-class membership system as a chance to examine all our operational club and member processes. We have removed paper processes and improved the member in-club experience as well as vastly reduced the back-end reconciliation processing required for three legacy systems. We can now speed up all aspects of our member interfaces from sign-up to billing and problem resolution. It's also a simpler, more intuitive system for our staff and through e-learning and webinars for roll-out we have managed to capture, share and retain best practice across the organisation.
How has your leadership style contributed to the outcomes of the transformation project?
I have led the programme and ensured buy-in from our shareholders by being able to communicate in a simple way how the project workstreams would deliver clear business benefits and how, through sensible management and governance, we could ensure that progress and issues were transparent at all times. This approach has built confidence and ensured that when business implementation issues arose, I could rely on my board and my peers to find a resolution. This in turn has led to confidence in the team and through open communication via blogs, email and stand-ups, I have ensured that everyone understands the reasons and rationales for project decisions and gets behind the direction we are going in.
What key technologies do you consider enable transformation?
1. Mobility – anything that contributes to having information and communication at your fingertips when you need it to ensure speedy and effective decision-making.
2. Data and analytics – systems and information that provide actionable insight. We all have masses of data at hand, but understanding what to act on and what to ignore is the real business advantage.
Are you expanding the number of cloud applications or infrastructure in use at your organisation?
What is your information and data analytics vision for the organisation?
Understanding the end-to-end customer journey is incredibly important for us. The health and fitness industry suffers from a huge retention challenge, yet it has universally missed the opportunity to use customer analytics embedded in a coherent digital journey to understand behaviours, motivations and blockers. That understanding will allow a wellness provider to intervene and motivate at the appropriate points. We can use our models and understanding of member behaviour to become far more engaging and motivating. Our digital journey project will provide a platform for our members to interact with us on the move, on the web, in club, and give them better services and us a better idea of how we can engage with them.
How is mobile and social networking impacting operations and customer experience?
Mobile is the channel of choice for our members. They are on the move and active and they don't want a drawn-out traditional website interaction with us. We have not served this channel well in the past but the digital journey project will deliver a great experience for them in 2015.
Social has become an important channel for engagement and feedback but still has huge potential for us in supporting the natural communities that we build in our clubs with our member bases.
Describe your strategic vision towards shadow IT and BYOD. How do you influence and engage executives and employees around choice?
Business departments will always find ways to provide their own solutions if they find it easier than dealing with their IT colleagues. In today's connected world almost every project is an IT project and we can't control them all. My vision (which is partway in delivery) is to provide first-class business partnering to my board colleagues to ensure we can understand their challenges and advise on solutions. Some of those solutions may not come from my department, and that's fine as long as we understand the implications and mitigate accordingly. As we build trust we can help more and more with prioritisation and investment decisions. We're already seeing changes in the way the business wants to work more openly with us and this is set to improve further in 2015.
What strategic technology deals have been struck and with whom?
• Microsoft Enterprise Agreement
• Samsung Technology Partnership
Who are your main suppliers?
• Vodafone (WAN)
• Pixsel (datacentre)
Virgin Active IT security and budget
Has your organisation detected a cyber intrusion in the last 12 months?
Has cyber-security risen up your management agenda?
Does your organisation understand the potential cyber-security threats it faces?
Has this led to an increase in your security budget?
What is the IT budget?
Globally:£7m capex, £9m opex (1.5% of revenue).
What is the strategic aim of the CIO and IT operations for the next financial year?
To support the two basic tenets of our business strategy – increasing sales performance and retaining members. IT will be supporting this through a major investment in the digital journey this year to provide a best-in-class mobile and web experience that attracts new leads and gets them to our clubs. There will also be an end-to-end digital service that supports our members with services they need, along with content and motivation that keep us relevant and the members engaged and inspired.
Are you finding it difficult to recruit the talent you need to drive transformation?
Has recruitment and retention risen up your agenda as a CIO?
Are you looking for recruits in the EU to fill the skills shortage you have?
Does your IT organisation operate an apprenticeship scheme?
Virgin Active technology department
How would you describe your leadership style?
Open, communicative, engaging and business-orientated. I enjoy supporting and developing my team to ensure they are given the time, the space and the trust to meet their goals, both personal and business. I always want them to understand how they can relate what they are doing to business objectives at whatever level they are working at.
Explain how you’ve supported and developed your senior leadership team to support your overall objectives and vision
I have been building the team over the last six months. I try to ensure that I'm communicating my vision for where we need to be over the next 12 to 24 months and then I work closely with them to make sure that it's achievable and that they help produce a strategy to achieve that vision. I also want to make sure they have development opportunities and continue to grow as IT leaders themselves. Ultimately, the stronger the team around me, the easier my job becomes.
How many employees are in your IT team?
What is the split between in-house/outsourced staff?
Does your team include key skilled workers from the EU?