Despite its trendy digital startup image, Yodel’s formation from two companies in 2010 saddled it with two outdated legacy systems that have held back the ability to innovate and move the business forward. Under Adam Gerrard, the business has moved moving from outdated technologies at almost every part of the infrastructure from data centre to desktop to a private cloud infrastructure with burst capability into the public cloud, and new WAN and end-user devices. The use of the right device for the role has lifted productivity. A peak trading period has seen no major technology incidents. And there has been a significant improvement in data access across the estate. Much more fact-based decision-making can now happen in real-time, which has underpinned the drive to turn Yodel into a data driven-business.
How are you influencing the products, customer experience and services your organisation offers to its customers?
We are keen to push the digital agenda very hard. As more and more of the consumer touch-points in the supply chain become digitally accessible, it is important to have the people with the best visibility of emerging technologies’ potential opportunities involved in the thinking around propositions. I have personally been involved in workshops with the Yodel marketing team, and that has allowed me to impart a vision of the art of the possible with regards to our technology in the client and consumer world.
Conversely, being involved in that process has made sure that I work to keep the IT team aligned with the priorities that come out of those sessions. The IT team is structured to ensure we have the best possible touch-points to maximise the potential of the talent within the team and the wider business. Our agile delivery model has driven us down a road of a more focused, product-based level of engagement with the rest of the organisation. Every aspect of the products and solutions we look to deliver are now focused on the customer experience.
Define the key business outcomes that you have delivered over the last 12 months and their impact on your organisation’s performance
We have had multiple transformation activities in the last 12 months and a significant level of other portfolio-led change to work through. The big-ticket item of the last 12 months was the infrastructure transformation. Yodel was formed from two companies in 2010, and has been working with two outdated legacy systems, which has held back our ability to innovate and move the business forward.
We have been moving from very outdated technologies at almost every part of the infrastructure from datacentre to desktop to a position now where we have a Flexpod-based private cloud infrastructure with burst capability into the public cloud, new WAN and new end-user computing devices all running Windows 10.
Our handheld terminals, as used in the field, are the last piece of that hardware journey to tackle, and I hope we will make good progress there in 2017 as we look to transform our core applications.
The business outcomes have been:
- There has been a lift in productivity thanks to the use of the right device for the role. In many instances now across Yodel, the right device for the role is a Surface Pro 4 running Windows 10.
- There was a peak trading period at the end of 2017 with no major technology incidents.
- There has been a significant improvement in data access across our estate. In 2015, on the busiest day of the year, we had a maximum data lag from scan to full visibility in all systems of 25 hours. In addition to this, our data queues peaked at 21 hours wait time. In the busiest period of the last 12 months, we saw a maximum end-to-end data lag of just 45 seconds, averaging less than five seconds, and a longest queue time of 15 mins in our legacy applications, with averages less than 60 seconds. This allowed much more fact-based decision-making to happen in real-time, which has underpinned our drive to be a data driven-business.
Another couple of unlikely wins in 2016 were the launch of our mobile app and our driver visibility tracker. Admittedly we were late to the market with a mobile app due to the many constraints in our legacy systems. As we progressed through the transformation, it was clear that we were breaking down blockers that could enable more customer-facing tools to be leveraged.
In August we launched a beta app with some basic tracking services; as consumers provided feedback, we rapidly increased the functionality available. By November last year we had launched multiple iterations of the app and had built up a level of functionality at least on a par with our core competitors.
A new piece of functionality that we launched in November was the driver tracker. Based on customer feedback we realised that the underlying need of the consumer was not a map to track the driver’s progress, but an understanding of when they will get their delivery.
We delivered a very simple solution that now lets the consumer track how many more parcels their delivery driver has to deliver before arriving at their house. Clearly, if the driver still has 50 parcels to deliver, the customer can nip out to the shops, go round with the vacuum cleaner, or do something else they wanted to get done that day. If the driver has only three more parcels to go, the customer can see this and is looking out for our van and is ready to sign when we pull up, thereby increasing the chance of a successful delivery on the first attempt.
We do have time-based delivery services available for clients to buy as an enhanced service for their customers. However, given the pressure to give delivery away for free, there is reluctance among retailers to invest in this type of service for low-value products. The new solution doesn’t require a committed time window, so we are able to optimise our routes accordingly, which in turn means we are able to provide this feature as standard within our primary man in a van delivery service.
15–20 other projects have also been delivered in the last 12 months in line with our change portfolio. Without naming them all, we have done a lot of work to further reduce our cost base, improve levels of services to clients and consumers, and completed the technology separation of our sister company Arrow XL, which is now able to drive its own independent technology strategy.
What has been your involvement with innovation at your organisation – in particular, with products, business model and technology – over the last 12 months?
Product innovation. This has assisted in the new product development workshops, aligning an agile change function with our product set and engaging our architects, subject matter experts and other thought leaders in the discussions about where to take our products over the coming 6-18 months
Business model innovation. The whole executive team is engaged in challenging and growing our business model to realise the optimum potential of the business. The new IT target operating model and the move to be more data-driven have been enablers that are allowing rapid responsive change to data-driven insights.
Technology innovation. Products, architecture and innovation collectively have formed one of the cornerstones of the IT strategy for the past couple of years. My role as a technologist on the executive team is to ensure that we are not missing opportunities to leverage technology-led innovation, and also to educate the executive and shareholders in where we can gain the greatest business value from investments in technology. One of our biggest tech innovations in 2016 was the way we approached replacing our legacy server-side compute stack, storage and networking. The Cisco Flexpod technology we selected is leading-edge, but our approach to delivering it at pace was even more innovative. Rather than rewrite the whole story here, I will just add that it was so good that the BCS awarded Yodel the runner-up spot for Infrastructure Innovation of the Year at the 2016 UK IT Awards.
How have you delivered cultural and behavioural change as a CIO within the IT department and/or more broadly across the organisation?
The culture within the IT team is significantly different to when I joined in 2014. I am a believer in hiring the best talent available and empowering them. My role has been to provide guidance for the team in terms of a technology vision and roadmap, then provide the inspiration for them not only to buy into the vision but to make it happen. Along the way we have become a very effective organisation, delivering at pace, passionate about our company and extremely highly regarded both internally and externally, as vindicated by the team winning the BCS UK IT Award for Best IT Team 2016.
The passion and enthusiasm of the team is contagious. Many of the events and practices we started in the IT team in Liverpool have now spread across other functions in the same building. The IT director of service and infrastructure was part of the team that defined the new internal Yodel behaviours and was the pioneer of one of those four key values: ‘delivering with oompf!’
Culturally, we are still a business in transformation, but I would like to think that the culture we have established within the IT team is the culture we want to have as a wider business, and that we are helping play our part in taking the rest of the organisation on that journey.
How have you worked with your CEO and/or board to communicate whatever ‘digital’ and IT means to your organisation/sector and improve digital literacy at the highest levels of the organisation?
The last couple of years have been about building trust and delivering larger returns from our technology investments every year, not just with the board and CEO but also Yodel’s shareholders. There is now a great deal of trust in what we can expect our IT team to deliver and a willingness to invest more in the knowledge that value will be returned. In terms of educating the senior leadership of Yodel in what digital means, it is a continuing process. The narrative is formed around analogies and examples relating back to customer behaviour that everyone can understand and buy into.
In the layer beneath the executive team, the senior leaders of Yodel, we do have a few people with more appreciation for digital ways of working, if not digital natives. Through me and my senior leadership team building strong relationships across the business leadership community, and through regular communications/updates, we are constantly driving up the understanding of digital within the organisation. This is a key part of shaping our digital agenda.
How have you worked with the technology and IT vendor market to achieve your business goals? How have you been able to influence IT suppliers and successfully manage your partnerships/relationships with large IT companies, SMEs and startups?
Soon after joining Yodel I was keen to rationalise our supplier base from a lot of vendors/service providers to a more focused selection of partners. We have very good working relationships with the likes of SCC, Zebra, IBM, Teradata and Cisco to name a few. Being able to establish good executive relationships with our partners and have them engage with the wider leadership team has been critical to them understanding our business and to Yodel understanding where they can add the most value.
We also work with several smaller organisations that are very fleet of foot and able to help us with our disruptive thinking. It is much harder to spend the time necessary in this space as there are so many players and emerging companies that often fly below the radar. However, a commitment to networking events at various levels within my team does help us get a view of new and interesting organisations with potential to help us on our journey.
How have you tried to develop the diversity of your team?
We have a policy of no discrimination, and continually hiring the best available talent naturally brings with it diversity. Currently over 50% of my senior leadership team is female, and we are increasing our ethnic diversity. As we continue to improve our employer brand proposition we are increasingly seen as an employer of choice for some of the UK’s best tech talent, and as a result we are attracting more diverse talent.
Describe how you organise and operate IT and how this aligns effectively with business strategy and operations
From the top down, I have split the responsibilities of my direct reports into the following four workstreams:
- Dev/ops: IT service management and delivery; IT operations and infrastructure development including technical architecture; and development (legacy and agile) including product architecture. Both infrastructure and development operate bimodally.
- Change delivery: programme and project management; project management office; solution architecture and business analysis; and IT and data governance.
- Product, architecture and innovation: product development roadmapping; enterprise architecture; and innovation lab and technology thought leadership.
- IT security: cybersecurity; data protection; risk management; and audit compliance.
We are organised in a matrix model that fully supports an agile way of working. This means that in the development function many people will feel like they have two managers. A delivery manager ensures that agile squads deliver rapid sprints of work at a high velocity, while functional practice leads ensure that developers work to the correct coding standards, testers make full use of automation, etc. Even in the legacy systems space we can deliver change in an agile way, but have to revert to a waterfall release management process as opposed to the more effective way of realising value through continuous delivery.
What strategic technology deals have you made in the last year and who are your main suppliers and IT partners?
- IBM – hosting, services, cognitive intelligence
- Cisco – Flexpods
- Teradata – primary provider of analytics technology
- Microsoft – Surface Pro 4s, Windows 10, Office 365, Yammer, Azure
- O2 – mobile telephony
- Zebra – handheld scanners.
What are your key strategic aims for next year?
Our aims are to be more client-focused and to deliver to their expectations while further optimising our cost base. We have 14 strategic initiatives that will enable us to achieve these aims, several of which have been running for 12 months now, but all of which need the support of the technology function to be successful.
There are many commercially confidential projects that I cannot name, but some significant pieces of work include:
- Migrate away from a substantial element of our legacy systems to our new application platform.
- Become even more obsessed by data.
- Implement real-time data-led decision support tools into our operations.
- Rationalise our back-office systems for greater efficiency.
- Apply greater focus to our consumer product offerings.
- Release our new cognitive intelligence driven services.
How are you preparing for any impacts Brexit might have on your organisation?
We don’t have a fully formalised plan for Brexit at this stage. We need to take a watching brief on the direction of travel that the UK takes with regards to certain elements of Brexit. For example, access to diverse talent pool could be at risk depending on the decisions taken around immigration. We will continue to discuss the risk, issues and opportunities as more clarity emerges.
When did you start your current role?
What is your reporting line?
Are you a member of the executive leadership?
Are you a member of the board of directors?
The executive team fulfils that role with the addition of shareholder representatives.
What other emerging roles does your organisation have and what is their relationship to you?
I am accountable for driving our digital agenda, data use and analytics, information strategy, innovation and the technology infrastructure of the business. We do not have any other C-level roles in these areas.
How often do you meet with your organisation’s CEO or equivalent?
Multiple times per week.
How many people at your organisation does your function supply services to?
Up to 13,500 people ranging from back-office staff to field sales and third-party colleagues such as drivers and couriers. Also, we provide systems, portals, apps and websites that are used by hundreds of Yodel clients and up to 65m people in the UK.
What is your annual IT budget, or your spend as a proportion of the organisation’s revenue?
P&L opex spend is circa 3% of revenue; capex spend for last 12 months was circa 9% of revenue based on the increased investments made in the last year by our shareholder.
What percentage of your budget is operational spend (ie keeping the lights on) and how much new development (ie innovation, R&D, exploratory IT?
On a total cash spend basis, 25% of IT spend is on keeping the lights on.
Please rank in order of importance the following sources of advice/information:
- CIO peers
- Analyst houses
- Industry bodies.
Has your organisation detected a cyber intrusion in the last 12 months?
Yes and contained it.
Are you expecting an increase in budget specific to security in order to tackle the cyber threat?
Yes, we have increased our spend on cyber defence and cyber insurance.
Does your organisation have a designated security professional – CISO or otherwise – and what is their relationship to you?
Yes, as a direct report to me.
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?
It’s always up there. If you recruit the best, you have to work hard to retain them.
Does your IT organisation operate an apprenticeship scheme?
Not yet, but we are looking to trial a dev/ops scheme
How many employees are there in your IT team?
Are you increasing your headcount or planning to bring skills and the ability to react to needs in-house?
We are currently moving to employ more permanent staff in order to reduce our dependency on contractors. As we get greater visibility of the levels of change, we anticipate that we will need to deliver over a three to five-year time horizon. It is easier to justify a larger permanent headcount within the existing team.
In which technologies or areas (cloud, analytics, security, IoT, etc) are you expecting to be investing in over the next year?
Analytics, cognitive intelligence, security, IoT, CX and UX, and automation.
In which technologies or areas (cloud, analytics, security, IoT, etc) are you expecting to be investing in over the next one to three years?
Advanced analytics, IoT, security, cloud, augmented reality, behaviour-driven development.
What emerging technologies are you investigating or expect to have a big impact on your sector or organisation?
Deep learning, AR, VR, AI, IoT, robotics, self-driving fleets and some other form of tech that has not yet been thought of (think of Nokia’s vision for the future of mobile in 2006!).
Does your organisation do a significant amount of trade with the EU?
Does your department include technology staff from the EU?
Are you or have you been looking to the EU to recruit key skills?
Not specifically, but we have hired EU nationals in the UK who are not, and will not be, UK passport holders in 2019.