CEO Talks with Tom Raftery: A Leadership Brief on Supply Chain Innovation
Amid the disruption of 2020, the global pandemic provided a rare window into the future of business as it unfolded in real time. The scope and speed of change were unprecedented, accelerating digital transformation by as much as five years in a 12-month period. As someone whose job entails predicting the future, Tom Raftery stays optimistic and is convinced of the unstoppable march of progress.
Tom Raftery is a global vice-president, futurist, and innovation evangelist for SAP, an adjunct professor at the Instituto Internacional San Telmo, and a board advisor for a number of startups. He was the co-founder of an Irish software development company and a social media consultancy, and the director of hyper energy-efficient data center Cork Internet eXchange – the data center with the lowest latency connection between Europe and North America.
Unlike many C-Suite executives, Tom has a sort of uniform: blue jeans, a light shirt, a blazer and a hat. This hat creates the whole story around his outstanding personality and is an indispensable ingredient of his eye-catching personal brand.
He recently joined me for a conversation on his personal career, Elon Musk’s business leadership, post-pandemic supply chain, and also:
What it takes to almost become "the voice of Tesla" and reject this role for the sake of family well-being
What is the winning formula behind SAP's global success
What will SAP look like in the next five to 10 years
Why will transparency, resilience, and visibility be critical for supply chains in the post-pandemic era
Why research is key to giving a fearless public talk
How automating all repetitive tasks can grow your personal productivity
And why consistency is crucial to managing a personal brand
IK: You’re a graduate biologist, a serial entrepreneur, a professor, a board advisor for several startups, a blogger, a podcaster, and a global vice-president for SAP. How did your extraordinary business journey begin? Do you ever have moments where you think, "Boy, I wish I had done it differently"?
TR: After I was conferred with my degree in biology, I was invited back into the department to study for a Ph.D. in Biological Control. While I was doing that, I set up a computer course for the undergraduates as I had developed a strong interest in computers. I then approached the local computer companies and offered to teach their customers - they were happy for me to do so. Over the next couple of years, the number of requests I got to teach courses increased to the point, where I brought a number of friends into the business to help cover all the courses.
Then we started getting requests to develop custom software, and eventually, after about four years of it being a hobby, I decided better to just jump and make this a full-time career. So I left the Ph.D. and went into full-time computers: set up a computer company with a friend, took on a few programmers, and started working from there. That's how my business career started.
Is there anything I would change?
I've been very lucky to always get roles that I seem to enjoy. I'm a bit ADD and I get bored very quickly, so I need to be doing something that allows me to try new things all the time. I was doing software development because it was very straightforward. In such a tech field, you always try out the latest things or you look at the latest technology and implement it: "Yes, that's great! Oh, that's cool! Oh, look, this new thing has just come along!"
So I always try to see what's new, fun, and interesting. That's led to some great roles and jobs, and I don't think there's anything I would change in my professional career. There's nothing that comes to mind anyway. I've enjoyed every minute of it.
IK: What’s the story behind your potential employment by Tesla and Elon Musk’s intervention in the hiring process?
TR: I wrote a blog post back in 2016 saying I was leaving my then role with RedMonk and that I was in talks with a number of companies. But there was nothing signed, so the window was still open in case anyone else wanted to get in touch.
A number of other companies did, including SAP and Tesla. I received an email from Elon Musk’s executive assistant Emma Gallagher, saying Elon was interested in talking to me. This was May 2016, so we had a fascinating conversation around the Model 3 launch amongst other topics. He told me he found my blog to be "interesting and insightful" and that he wanted me to be "the voice of Tesla".
I spoke with several members of his leadership team over the next several weeks, and while the offer was really tempting, the one aspect I couldn’t accept was that they wanted me to move to Palo Alto. This would have meant a big step down in quality of life for my family, which was a step I wasn’t prepared to take. SAP, on the other hand, said they had no issues with my being based in Spain, and the rest is history.
IK: When we speak about global challenges, Elon Musk is the top-of-mind entrepreneur who is constantly searching for solutions and finding them. What’s your opinion on his business and thought leadership?
TR: On the one hand, he's a fascinating character. He has changed the world of the automotive industry unrecognizably. In 15 short years, he started a new car company (an electric car company) in the US, making it successful and changing the world, so that every other car company now has to produce electric vehicles to compete. He has revolutionized the space industry with SpaceX, and is disrupting Internet connectivity with Starlink. And that’s before we even mention Neuralink, The Boring Company, or OpenAI. That's incredible.
On the other hand, his dismissal of the seriousness of the pandemic, his cavalier attitude to cryptocurrencies, as well as his attitude to unions and workforce, clearly demonstrate that he’s as fallible as any of us.
IK: Let’s get the SAP questions out of the way. The company is among global industry leaders, and it constantly proves its market leadership. In your opinion, what’s the success formula behind it?
TR: Well, first of all, SAP invented the concept of ERP - Enterprise Resource Planning. This gave the company a big head start on others in the space.
Second, SAP expanded its offerings across all the industries, so no matter what industry you are in - be it banking, manufacturing, transportation, utilities, you name it - SAP software has you covered.
Third, SAP expanded its offerings even further through a series of strategic acquisitions, which has led us to the world-leading place we are in today.
While SAP believes its own ability to innovate is key to long-term success, it acknowledges that acquisition can be an important part of an innovation strategy if focused on gaining technology rather than market share or customer databases.
Our growth is also being driven by the company's innovation around in-memory computing that centers on SAP's High-Performance Analytic Appliance (HANA) that provides a boost in performance by holding data to be processed in RAM instead of reading it from disks or flash storage.
Customers are interested in adopting this technology because it dramatically increases their ability to predict the future and analyze in real time what is going on in the business, and, at the same time, reduces the cost of hardware infrastructure.
Another success factor is that we are customer-obsessed. We have, for example, co-innovation laboratories where we bring customers in and co-innovate products with them. We have customer councils where we bring the customers in and we talk through their pain points and things they would like to see us add to our software.
So SAP is achieving success by enabling its customers to do more and cut costs through evolution of its core products and innovative application of new technologies.
IK: What will SAP look like in the next five to 10 years?
TR: We are shifting very much to being a cloud company. That has huge implications for us and for our customers.
As we're going to be delivering cloud-delivered software, this shift has big implications for the software developers because it's a completely different type of development.
It has huge implications for the sales teams because it's a completely different sales model. It has huge implications for the customers because it's a completely different purchasing and delivery model. The shift to the cloud was never going to be easy and it isn't for any changing business models. But we are doing well so far and my predictions are optimistic.
Over the next five to 10 years, the hype will be around machine learning, artificial intelligence, and augmented reality. SAP plans to use machine learning to help customers stay competitive by personalizing the end-customer journey. Specific focus areas in which SAP plans to use machine learning include sustainability, and in the boardroom, to tackle gender bias and to develop new applications. SAP is taking its analytics business a step further with machine learning, which further signifies another phase of the company's transformation process into the cloud.
SAP Retail and Consumer Products Day, Warsaw, March 2019.
So all these technologies will enable our customers to use the latest and greatest, as would be expected from a high-tech cloud software vendor such as SAP.
IK: How did the pandemic change the global supply chain? What are the key leadership lessons that we should learn?
TR: Pre-pandemic supply chains were very much optimized for efficiency.
They were seen as a cost center, and many organizations tried to cut costs as much as possible. Consequently, there was underinvestment in supply chains, and so they were brittle. They had points of failure, and when the pandemic came, this became obvious very quickly. A lot of supply chains broke and had big issues.
Organizations quickly realized that they needed to digitize their supply chains to make them more efficient, while crucially increasing transparency and resilience.
One of the biggest problems with supply chains is that they, typically, go all over the place. You're buying your widget from a particular supplier, who is sourcing it from two or three other suppliers, and they're sourcing components from other places that you have absolutely no visibility of whatsoever.
If anything happens to any of those suppliers down the line, it might mean that you can no longer produce goods in your factory. That's what happened last year and again this year with the Suez Canal blockage. With disruptions to supply chains happening with increasing frequency, a lack of transparency and resilience in supply chains is unsustainable.
These days, supply chain managers see that they need to bring more visibility into their supply chains by digitizing them. Because the way to introduce transparency into your supply chain is to digitize it so that you can just look straight down through it and make it resilient.
Resilience is a tougher one to do. It involves transparency, but also business planning. Traditionally, business planning is something that has been done in supply chains once a month, at most. But things are changing so fast now that many companies have gone to a weekly, or sometimes, even a daily planning cadence. To do that, you have to switch away from Excel spreadsheets for your planning and get into dedicated planning software.
This should be planning software that is connected to your systems as well as to your supplier systems, preferably cloud-delivered so that you know everyone sees the same version of the truth.
Then again, digitalization will bring more resilience to your supply chain because, as I said, resilience and transparency are the two big things that you need to add to your supply chain in the short term.
In the longer term, you need to also be adding sustainability. Preferably, adding it in the short term, but thinking long term while adding it. Because it's not something that you just want to or can bolt on; it's something that requires a bigger picture.
IK: You’re an avid public speaker. In 2019, you gave more than 42 keynotes globally. Can you share your speaking tips and tricks?
TR: What works for me is to talk about things that I have heavily researched and know really well. All the decks I present are decks that I have put together myself. I don't use anyone else's material. If it's material that I have researched heavily and know deeply-deeply-deeply, then I'm not going to be nervous about giving a talk: I know it well, I have researched it, and I have prepared it myself. That's fundamental to me.
You shouldn’t speak about something in public if you're not knowledgeable about it. You will certainly be extremely nervous if you're standing up in front of an audience talking about something that you know very little about. On the other hand, if you know a lot about it, then it becomes a lot easier to speak about it.
Energy and Natural Resources Summit, Istanbul, February 2020.
I do not know what I'm going to say before I get up and start speaking. As in, I do not write it out. My slides are, typically, pictures with no text, or maybe it's a screenshot of a website or something like that. And that triggers a thought in me rather than my reading off the text that's on it. I speak off the top of my head. I know the points I want to make, however, I don't know the precise words I'm going to use to make those points until I start speaking.
IK: What’s your winning productivity advice?
TR: I try to make sure that I do not do much repetitive work. If I find that there's something that I do often, I try to automate it or, at least, make it easier or less time-consuming.
I publish three podcast episodes a week, for example. One of the things I have to do after I publish the podcast is I have to contact the person I’ve interviewed and I have to send them an email saying: "Here’s where the podcast is, and you can check it out by clicking this link." I was doing that all the time, and I said nope, what I'm going to do is I'm going to get a set email with a couple of different variables, swap out those variables, and then just use it for all the outgoing podcast emails.
Every time I do that now, I can just change the variables, so now it takes me 10 seconds to send an email when the podcast is published.
So my advice would be to automate as much as you can particularly for anything repetitive.
IK: You are also a founder of a social media agency and a blogger. What role did personal branding play in your success?
TR: A huge role. I mean, a lot of it has been about getting my name out there, and I do that by being very public, by being on Twitter a lot. I've posted on Twitter more than 80,000 times, I think. I publish things on Linkedin several times a day. I publish three podcast episodes a week to build visibility.
And I try to be consistent as well, so the profile picture I use, for example, is always the same across platforms. Overall, the way I present myself publicly is always the same, or very similar. Consistency is always key to managing a brand, so to speak. Anyone will tell you that.
I do that, and my values are always the same. Again, very strong on climate and sustainability, and those are two of the core values that I push a lot because I think they're important. So that helps a lot.
IK: I think your public image is recognizable because of your hat...
TR: Yeah, that came about because I live in the South of Spain. I'm originally from Ireland with very pale skin, and I get burned very easily. I do not tan, so I needed some form of protection from the hot Spanish sun.
SAP Headquarters, Walldorf, Germany, August 2019.
I could either walk around with a parasol, which would work quite well. But it would mean I would be losing the use of one arm, or I could go for a hat. So I chose the hat option.
I figured out I could just about pull that off - the hat look - but the parasol would be a step too far for me!
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