On Digital Transformation: A Conversation with Shams Chauthani
As B2B companies continue to adjust to the fundamental business shifts of the past year and with Zilliant MindShare 2021 rapidly approaching, it’s a good time to take a look at how leading B2B companies are responding through digital transformation. With that in mind, we sat down for a Q-and-A with Zilliant Chief Technology Officer Shams Chauthani in advance of his MindShare breakout session. Read on to learn what he is seeing in the market and why Zilliant leads by example when it comes to helping customers digitally transform their business.
It seems like everyone is talking about digital transformation. Why should companies get on the bandwagon?
Well, the concept of digital transformation is certainly not new. The need for transforming businesses using digital innovations has been a topic of conversation for decades now. While some industries have completely transformed, until recently most companies took a slow and measured approach to it.
Several factors are accelerating the trend and causing digital to reach a critical mass in the B2B world. First, B2B buyers are also digital consumers in their personal lives and have gotten used to the convenience of the B2C experience. Naturally, they are starting to expect the same ease of conducting business from their B2B suppliers, especially the younger generation of buyers who grew up online. B2B companies realize that their customers need self-service capabilities online that mimic the interactions they have with sales reps offline. This means access to customer-specific pricing, the ability to negotiate and relevant product guidance and recommendations.
Two other factors that have accelerated the urgency for B2B digital transformation are competitors and COVID-19. Digital-native players like Amazon have been setting the trend for years and taking share away from traditional manufacturers and distributors. The pandemic, of course, dramatically increased online commerce – those that already had a strong digital presence or were able to pivot quickly thrived in this environment.
Zilliant went through its own digital transformation several years back. Can you describe that process and how our own transformation helps us advise clients?
Yes, ten years ago, before anyone in our space, we recognized the trend toward SaaS solutions. We decided to invest in building a cloud-native multi-tenant SaaS platform to serve as the foundation for all of our products. This was a customer-first move. We anticipated that the cloud would offer better return on investment for Zilliant solutions by allowing customers to get value without significant IT overhead. It also allowed us to innovate fast and deliver a better customer experience.
This digital transformation was a multi-year journey to transform our product. We took a steady approach that leveraged best practices to slowly transform our on-prem products to the cloud-native platform we offer today. This was not an overnight transformation; we took small steps along this journey. We first hosted our existing monolith solution in the cloud and then started modernizing the infrastructure and technology leveraging a microservices architecture and cloud-native capabilities. In essence, we could change the engine on the plane while it was still flying. We built a future-ready platform with minimal impact on our customers’ day-to-day business. This approach is referred to as a Strangler pattern in the industry - if you are considering such shifts in your technology landscape, we recommend applying this approach, as it allows you to continue delivering value while transforming the technology for the future.
What benefits have we, and by extension, our customers seen from this?
The investment we made in transforming our product has paid a lot of dividends. Technology is evolving quickly. With our architecture we can take advantage of these innovations without having to start from scratch. This allows us to meet the needs of our customers and prevents us from being boxed in by technology choices we have made in the past. For instance, when Amazon Redshift became a viable option, we leveraged it to deliver blazingly fast analytics for very large datasets, up to 25 billion records. A traditional relational database would never have allowed us to scale to those sizes.
Our customers also benefit from our continuous delivery model. We push software releases often, to all customers simultaneously. This approach allows us to get feedback from a customer and incorporate it into an updated release within days. Since we release small changes that are tested thoroughly, the quality of our releases has dramatically improved. The bite-sized, continuous approach removes the painful upgrade process that is often time-consuming and distracting from core business value for our customers.
What are you seeing in the Zilliant customer base as it relates to digital transformation efforts?
We’re seeing a lot of movement. I have seen the trend to offer services through the web channel accelerate significantly, including the ability to transact business and choose and schedule value-added services online.
There are more and more triggers that are causing companies to make pricing moves. From tariffs to competitive threats to inventory and supply chain disruptions, the ability to be nimble in the wake of these changes is causing a major uptick in digital and automated solutions.
Companies need more flexibility when setting prices in digital channels. Often, customers find the systems they have in place to be too restrictive. Artificial intelligence and automated rules-driven applications are quickly becoming the norm, especially as more companies strive to offer dynamic pricing and real-time market pricing capabilities.
What are some examples of how Zilliant is helping clients reach these goals?
Let’s go over a couple recent examples of how we’re taking difficult, time-consuming legacy processes and making them ultra-efficient in the digital sphere.
An electrical products manufacturer was spending an inordinate amount of time managing the negotiation of large project bids, as is highly common in the industry. This company approached Zilliant with a vision to lead innovation in the space and improve its bottom line as it pertains to this very manual process. Our pricing engine accepts bids and approves or rejects them while making counteroffers with advanced margin-aware negotiation logic. We are now processing thousands of quotes per week with just over a one second average response time. This has drastically reduced bid escalation as more than 80% of quotes now don’t require a person to review them. It’s also freed up the company’s deal desk to spend more time on the biggest and most complicated deals.
Another example that comes to mind is an industrial manufacturer that lacked pricing flexibility due to a restrictive ERP system and also wanted to be able to leverage real-time data like inventory and competitor prices to inform pricing decisions. Zilliant’s price optimization and management engines are affording the customer the flexibility to shape their pricing process to meet their business needs and then leveraging APIs to instantly deliver prices into quoting and order processing tools. The customer is no longer constrained by the limitations of its ERP system when it comes to designing pricing processes nor does it have to create complex and expensive processes to handle bulk data load to keep its systems up to date. The result is a flexible and easy-to-use system to deliver real-time pricing directly into relevant business applications, while avoiding complex, time consuming, and costly ERP customization efforts.
Connecting the dots and speeding up data transfer between legacy systems, third-party data and sophisticated pricing and sales tools requires strong APIs. How do APIs power Zilliant’s approach to a digital architecture?
Absolutely. To be effective, the pricing guidance and execution process must be plugged into where the business is being conducted. We discussed the need for flexibility and agility earlier, and traditional integration approaches like batch data movements don’t offer those benefits.
Real-time integration using APIs is critical in really harnessing the power of the platform. Zilliant IQAnywhere™ enables customers to tap into the full set of capabilities of the Zilliant platform and integrate them into their existing systems without sacrificing flexibility. We are seeing an acceleration in the use of our IQAnywhere platform to integrate pricing into various business processes. Some examples include:
o Real-Time API to lookup guidance from Zilliant.
o Real-Time Formula engine that allows customers to configure complex business logic to deliver context-relevant pricing and sales recommendations.
o Notification engine that delivers guidance updates to customers as a push notification.
o Ability to embed Zilliant analytics into apps that are already used by their teams.
Let’s wrap up with some projections. Where do you see B2B companies going in the next year? Five years? What will be the fate of those that do not adopt digital transformation soon?
I expect the digital transformation trend to accelerate over the next year. The main factor driving this acceleration is the disruptive force of COVID-19. It is forcing everyone in B2B to adopt digital channels to deal with the new reality. I do not expect this trend to slow down post-COVID because I believe B2B customers will have gotten used to it and continue to demand a B2C experience from their vendors.
In the next five years I expect a successful digital footprint to become table stakes for B2B companies. There is a unique opportunity for B2B companies to adopt this digital transformation as an opportunity to innovate and disrupt their industry. This is a long road with great potential so companies must act now to ensure they are taking advantage of this opportunity. In my opinion, companies that seize on this opportunity will be the ones leading their industry in five years.
If you have more questions about digital transformation, reach out to the team today.