Gabriela Cadenas, SVP Digital and Technology Americas, The Heineken Company

Video transcript

 

Marcelo De Santis: Hello everyone, and welcome to a new episode of the HITEC Transform.ed series sponsored by Thoughtworks. My name is Marcelo De Santis,Chief Digital Officer of Thoughtworks in North America. I will be your moderator today.

 

Both HITEC and Thoughtworks believe that knowledge should be shared openly. We have designed this series to provide you with the opportunity to learn directly from C-level executives about their personal experience in leading the transformation of their organizations.

 

For today's interview, it's my pleasure and privilege to introduce Gabriela Cadenas, Senior Vice President, Digital and Technology for Heineken Americas. Gabriela is a technology and business executive with 20-plus years of experience in leading business transformation in Fortune 500 global organizations across many industries like consulting, telecommunications, financial services, pharma and FMCG. She has a solid track record of accelerating company growth by combining emerging technologies, business process optimization, and share services.

 

Gabriela strongly believes in the power of cultivating a collaborative team culture focused on delivering practical business results, profitable revenue, certified customers, and engage employees and business partners. Gabriela is well recognized for leading strategic technology innovation to grow top and bottom line of different organizations.

 

Gabriela, welcome, and thanks for making the time to be with us.

 

Gabriela Cadenas: It's my pleasure, Marcelo. Thank you for the welcoming.

 

Marcelo: Welcome. Let's dive in with the first question, Gabriela. Let's start talking about the transformation you are leading at Heineken. What are mainly the business outcomes that you're trying to achieve, and why is this so relevant for your organization?

 

Gabriela: Heineken is on the journey to become the best-connected brewer. As you know, Heineken has always been a strong art connections. We are very close to our consumers, we understand what they want, we understand how we serve them, and we also understand our customers. We have what we call country-centric model, so we are very close to our customers and consumers.

 

But in a world that is moving more to online, this is not longer enough. We need to be better connected. Better connected, and we call it the best-connected brewer, it goes beyond Heineken. Our consumers are expecting to understand what is the carbon footprint of the product that I'm consuming. Our customers, they want more than just ordering online, they want to understand how they can improve the performance, what else can they do, what is the competition doing, and they want it all at the same time.

 

At the same time, even our vendors, they want to understand what is the performance of their product, their raw material, or everything in our product on real-time. For us, we have the responsibility to actually be able to connect and provide that visibility to everyone in an enjoyable way. What we are doing to become the best-connected brewery, two main things at the same time. One is digitizing our road to consumer, but at the same time modernizing and simplifying our systems and applications and technology landscape in general.

 

Of course, 70% of the value comes from digitizing the route to consumer, but 75% of the effort come from the other side and probably is the one that not everyone sees. That is a little bit of what we're doing in our journey to actually become the best-connected brewer.

 

Marcelo: Excellent. I like the concept of the best-connected brewer. I don't know how many CPG companies in your category may be thinking about this. It's pretty inspiring and cool to see that.

 

Gabriela, in this journey of becoming the best-connected brewer, what are the main challenges that you're facing? You mentioned that there is a lot of value coming from digitalizing the front end of the journey, but also most of the effort is on the back office. Tell us a little bit about that.

 

Gabriela: I think that not everyone is aware, but Heineken being the second largest brewery worldwide, we grew by acquiring local companies everywhere that we go, so local beer companies and all that. Of course, technology was never a priority, so it was all about integrating the new business, making sure that the volume and the sales are coming, and then we will deal with technology. That at the end, the conclusion is we have more than 45 different ERPs worldwide. You can imagine being in technology, how complex that is.

 

That is one of the first challenges because we wanted to move faster, we wanted to be able to scale faster, but it was close to impossible because we were so fragmented that it's not possible to a scale. That was the wake up call that we receive three years ago before COVID when we said we need to do something.

 

I think it was very important because it was probably us on IT, we knew that there was something that we needed to do. It was a realization for the business to understand, yes, that's right, we have never put the priority to D&T or technology, or how you call it, now is the time. Now, we need to change the business to be actually be able to accelerate that journey.

 

Marcelo: That's a pretty large number of different systems. I'm sure you're being busy with that. Is that driving some sort of business process standardization along with the technology transformation, Gabriela?

 

Gabriela: We have decided because we don't have the luxury of time. We know that we are probably late to a journey that most CPG started probably, 10, 12, 15, years ago, but we don't have the luxury of time. As I mentioned, we are digitizing over to consumer. We want to be fast, innovative, and very close to our customers and consumers, but we need to fix the back office as we do it.

 

What we are doing, we don't want to drive full standardization worldwide, because we also believe that understanding the processes that we face at the local level are also relevant. We don't want to become a full global template type of thing. We have decided, we started on a study that we call the digital backbone and is identifying which are the core common processes that we need to have, and oversimplifying the work there is more around finance. Accounts to pay, GIL, P&L, and all that is common worldwide. Why don't we try to standardize that, and then develop a catalog of platforms that at the end are going to be connected to that core that are a catalog again.

 

We'll need to understand what is the size of your country, what is the size of your operation, what is the architect that you're having, and you have this manual or catalog of solutions that you can deploy. Then it's not one-size-fits-all type of a strategy.

 

Then, we're also giving, because we do it and, that is why I use my hands, we do the circle. The first one, the inner one is the core. Then we have what we call the business platform, it's that catalog of different solutions that we plug into the system. Then the last layer is the around digital product and innovation. We want to be able to give the countries the freedom to continue accelerating innovation because they are closer to what the customer-consumer, business, or whoever it may need and what. That is a little bit of how we're doing it.

 

Marcelo: Excellent. Very interesting and pragmatic also because you're right, sometimes we don't have the luxury of time to do the perfect thing. It's about how much good is good enough to move the company forward.

 

In regards to this aspect of the transformation, and knowing that in most transformations culture plays a significant role in moving things forward, how did you build the right culture between your technology and digital team and the rest of the organization to move things forward in the direction that you just described?

 

Gabriela: I think that as I mentioned, it was a realization from the business. We have evolved as a function in the past two, three years. We, Digital and Technology, were only a function that was born at the beginning of 2020, right before COVID. It was after the realization we were doing a strategic plan before COVID. We were doing the strategic planning and it was the business that realized, if we want to move faster, if we want to concur faster, we need to do something about it.

 

Digital transformation became one of the five strategic pillars for the company, being the first one around growth, and revenue, and going beyond years; being the second around reinvesting our cost, and reinvesting different things; the third one, very important around sustainability and responsibility; the fourth one around people, and then the fifth was digital transformation.

 

When it was recognized as something very important, it was a strategic pillar, they look around and say, but the structure that we have is not going to come our way, how do we do that? We created Digital and Technology as a separate function, no longer reporting to the CFO, reporting straight to the CEO, and that is replicated across all the operations that we have, functions, operating companies, regions, and everything.

 

That has embraced or helped the business embrace what is the power of the transformation that we want to drive. It's not my function and goals, it's the business goals that are enabled by technology. That is the way that we're doing and building that culture altogether because it's not our function driving technical solutions, it's around transforming the business and whenever needed, technology comes along.

 

Marcelo: Excellent, great approach, and seems like you got a pretty tight alignment between your team and

 

Marcelo: The rest of organization plus the recognition of becoming an independent function, driving change and transformation. That's very good news and nice to hear. I remember you told me that you have some set of values or leadership behaviors in Heineken and I found that very interesting how you use those to actually fuel this transformation. Would you tell us about those?

 

Gabriela: Yes. We have four company values that they have been around for ages. So are the same four values that we continue having. It's around deliver, and not only delivering-- is delivering our product in general, how do we make sure that a customer or consumer are having our brands at their hand. Then shaping and it's around shaping our future, shaping the strategies, and shaping where do we want to go. The third one is around develop, and it comes around developing our teams, our organization, developing everything that we want to drive.

 

The last one is around connect. As I mentioned at the beginning, Heineken is very good at connections and that is something that we value. Behind those four values, we have eight behaviors. I'm going to highlight a few of them. That is the way that we are embracing and helping and nurturing this transformation that we're having.

 

The first one is around, we want to play. We play to win. We want to win the heart of the customers and the consumer, and we want to be present at every table and at every bar. That drives the way that we want to provide successes to the company.

 

Then the second one is around, again, having the customer and the consumer at the heart of every decision that we take. We take that very seriously. We understand it's a win-win relationship so we are very close to understanding what are their pain points, what are their needs, and how can we actually help them fix it. Then we also grew as a company as some entrepreneurial spirit that we had. We nurture that, we value that agility, be close to the customer and consumer and even understand how the market is evolving. We really nurture that. Of course, technology enables a lot of that.

 

We also value the curiosity around learning. For us learning, upskilling is something very important. It's one of our company goals. We track the hours of people invested not only on D&T, but in general invested on training and upskilling. That is something that we take very seriously.

 

Then with the learning, it's around sharing and reapplying. We have operations in more than 80 countries. We are facing some of the same problems. We are facing some of the same things so we value a lot around sharing and reapplying because that will help us go faster. That is how we are accelerating our digital transformation in the company.

 

Marcelo: Excellent. I always love when you told me this that you are actually using the same principles that the company has set many years ago actually to modernize the company. That's a very interesting story as you speak how you use behaviors and leadership behaviors to drive transformation.

 

In regards of moving forward and making progress on this transformation, Gabriela. How do you know that you are going in the right direction? How do you measure success? How do you monitor progress?

 

Gabriela: I really love this question because this was something that we struggle a lot along the way. You know that things are moving and things are changing. This is an ever-changing world. If we don't track what we're doing, we're going to lose sight of where we want to go.

 

At the beginning of the journey, 2020, we establish a business scorecard with 25 different KPIs and metrics that we track in each and every opco or operating company that help us understand how are we making progress towards our strategy. It goes all the way from how many customers do we have online? How many consumer data do we have? How many or how much are we enabling an operating profit due to AI solutions? How many breweries do we have connected on connected brewery? How many process have we simplified? How many standard applications do we have?

 

How many hours have we automated? How many operating companies do we have using all our global platforms? How many hours are we training our people? We have different metrics that we have available every month and the important thing is being used worldwide in each of our operations to actually track the progress of the function. In most of the cases, it's not D&T metrics, it's a co-joined effort with the function. I'm responsible, but the function is also responsible. We are working together so it became corporate metrics overall. I think that is helping us move faster into the journey that we want to drive.

 

Marcelo: Excellent. How long did it take for you to align on those metrics, ballpark? It was a few months or more than that?

 

Gabriela: We started with seven metrics that were the easy ones to actually-- I mean, were the obvious one. We were driving the digital route to consumers, so let's track daily revenue. We were driving analytic use cases. How much are we making efficiencies or increase in revenue?

 

We started with a few and then we started adding them because we were proving the value. It was not around convincing, it was even trying to be able to provide the answers that the business were asking. At the beginning, it was more the obvious one and then after they saw the value, it increased, and now we are fixed some 25 for the past two years.

 

Marcelo: I like the approach, iterative looking for the right answer, the right metrics, right? That tells a lot about your organization and the ability to learn and change if--

 

Gabriela: I think it has been key because it's around the agility that we want to have. Probably at the beginning, we joke around the agility term because probably for most, agility is around speed. Let's do it on a structure and we will see-- No, in our case it's more around starting-- Good is good enough, let's start. It's better to start than to wait for a perfect product that then it's going to be too late. We do that. We do the success criteria and all that and it's a cultural mindset in the company overall. I think that it's proven to be successful for everyone.

 

Marcelo: Excellent. Great story, Gabriela. Let me pivot to a different part of your ecosystem of solutions and interactions with consumers and breweries. We all know the CPG industry also have, I would say, the challenge to access directly data from consumers, right? First-party data as we call it in CPG is like the holy grail of consumer insights. To your previous point, connecting with consumers, knowing what they want, knowing what they don't want. How do you manage to architect solutions that actually connect directly to your consumers, the ones enjoying your beers across the world?

Gabriela: Heineken has always been very good and famous around advertisement. We're very close to our consumer and we also leverage some global events to actually get closer to our consumers. Championship League, Formula 1, a lot of concert music concerts like Rock in Rio, and those things, are sponsored by us. Those are a very important source of first-party data.

 

Then we also have managed to evolve our global media expense from the traditional channels to the online channels. That has also helped us get closer to the Gen Zs and the younger generations and what they want to know, how they want to be treated and what is the experience that they want to have once they consume our brands.

 

Then we have different sources like everyone else, Facebook, the different websites, and the different connections that we have with the retailers. But then as we move to a world that is going to become cookieless, and we know that that is around the corner, we have been preparing ourselves on how do we provide a strategy that is not only helping us collect the data, which is great, but then what do we do with the data?

 

How do we use all the data as potentially-- We're even doing that. How do we use the consumer as an innovation channel? That closeness to the consumer, we're testing our products with different group of consumers around the world and that is helping us shape the product, and especially when we think around beyond beer, which is an unknown full area for us, that is also something that we're doing.

 

Probably things that people don't know about Heineken, for example, in Mexico, we own more than 15,000 stores. The SIX stores, they're similar to 7-Eleven, OXXO, and all that. They're called SIX. We have more than 15,000 stores, more than 2 million customers going weekly or monthly to our stores but we also have a direct B2C channel owned by Heineken, which is called GLUP.

 

Marcelo: You have most of the use cases in terms of connections with consumers, direct, indirect, through partners, right through your brand and marketing efforts. I'm sure data for you is really a strategic asset.

 

Let me ask you a bit of a question about your technology infrastructure. You mentioned you are doing your back office transformation, also your front office transformation, all these channels, and data that go back and forth. How do you decide when to buy a solution, a package, right as we do in large companies versus building something bespoke for your organization?

 

Gabriela: We were in the culture of always building because we thought that we were different. Especially not even the company was different. Our countries were different, so they were fighting around. I cannot reuse that because I'm different. My operation is different, and all that. We have now value more that we can go faster if we just adopt what is out there, and then probably change a little bit or adapt our processes to actually accelerate the journey.

 

We are now more on the lights of buying whatever is available, test it, fix it with different ad hocs if you have to, rather than customizing everything because then it's harder to scale. That is something that we have established also is one of the metrics that we track, how standard we are, and how easy it is for us to scale. It became also a business priority for us.

 

Marcelo: Excellent. Different kind of question for you now, Gabriela. I know you have a deep sense of gratitude. Every company that you have been leading transformation and technology as an executive, you always focus large part of your time, I will say, in giving back to the communities. Tell us a little bit about that part of Gabriela as the leader above and beyond the four walls of Heineken and so forth.

 

Gabriela: I think that, yes, and that touched a very personal part of me. I think one of my values has always been about leaving a legacy. I feel like I'm privileged. I'm blessed with everything that I have. How can I give back? How can I give back to communities? How can I give back to the world in general? Meaning I wake up every day trying to make a better world and trying to make a positive impact on the people, the culture, and the society that I work around.

 

I have had the privilege to actually work in companies that also value that in different ways and with different approach, but they value and they want to develop the communities where we serve. Heineken itself, and I think it's also very close to my heart, they launched last year what we call the Brew a Better World, and it's our sustainability strategy. We have strong metrics and strong targets for 2030 on how do we want to shape and how do we want to leave a better legacy behind us.

 

We have three main pillars. One is around environment. Of course, we produce in the environment so we need to watch out our carbon consumption and neutrality is something that we're trying to aim for. Also water, as a [unintelligible 00:22:11] we come to understand how precious water is, and it's not only around improving and making more efficient the consumption that we have of water, but making sure that we can circle it back to the world on a clean manner. That is also something that we're working on. Then circularity and that is where you see also in the industry in general, the increase on returnable packages and all that because that is also something very important for us.

 

Then the second pillar is around responsibility. I also find that one very good because we are an alcohol company. Even though, yes, we want to promote our products, we want to make sure that we have options for the consumer, non-alcohol options for everyone, and even low ABV for the consumer. We want to encourage the consumption but with moderation. Responsible consumption is something very important for us.

 

Then the third one, again very close to my heart, and it's around our social responsibility. For Heineken, it goes beyond diversity and inclusion. When we think around gender, for us, it's even more. We're a worldwide company. We want to make sure that everyone has a seat on the table. As we want the consumers, everyone to be sitting on a bar, we want everyone to feel included within the company. We have very strong measures behind that.

 

Then one part that I love is that we are not only helping the communities to get better, we're building knowledge. We're building capabilities in the communities for them to be self-sufficient and even for them to become local sourcing for us but also for different companies. That is something that we invest a lot to actually be able to build that capability.

 

As you can see at the end, our Heineken strategy is very close to my personal values, and then that gives me the energy to actually keep on going every day because it is working towards my personal goals as well.

 

Marcelo: Excellent. Thank you. We can see your impact even during this short interview we are having with you, Gabriela. You talked about sustainability. In conversations I have with many of your colleagues across different regions, I also see the technology teams and the technology leaders like you are all looking at how they can contribute, not only with using technology to be more sustainable but also how do they make their technology footprint more sustainable.

 

As all of you are moving to cloud or getting into different business models in what technology is at the core of the business process, are you doing anything about measuring the carbon footprint where basically, also helps your company to achieve those net zero goals and other sustainability goals that you have in your agenda?

 

Gabriela: Yes, when we started the journey to Brew a ∫etter World, probably we were looking, of course naturally to our breweries. What can they do? How can we improve? How can technology support there? Soon enough, we come to realize that we ourself as a function, have a carbon footprint, and we need to work into that.

 

We started the journey, educating ourselves, understanding what is the impact of every server, every computer, everything that we do, what is the impact. Now we also have the goals to actually improve that.

 

We have also work-- It was an internal functional education for us to understand how could we influence and drive the change and the transformation in the business functions to actually have different employee experience for them to be able to have a positive impact on the carbon footprint of ourself as a function. That is the part of the process where we are.

 

This year, we launched that. We are making some changes around. How do you store your email? What needs to be stored? What can be discarded? What can we do? What are the things-- Do we need to duplicate information? Because as you know, probably you have it, I have it, everyone have it. It's all on the cloud, and it's consuming.

Now we're working into that. I think that as a culture, we are getting there. Probably it's going to take a little bit longer for us to actually make all the change, but I think that we awaken the employee, and they want to have a positive impact as well.

 

Marcelo: Thank you. Very interesting use cases, specifically, when you mentioned about looking at how many times we are actually duplicating information repositories, which use cloud resources, which by the way, use energy and carbon footprint. Great, great Gabriela.

 

Completely different questions, we all know we are in the middle of, I will say, a recession in the economy, we see that during the US and in many different countries. How is to be a leader in technology like you in the middle of a recession?

 

Gabriela: I think that we need to be very creative. We need to be very open for change. I think that is in most cases, it's part of our DNA as technology professionals. We need now more than ever, we need to be able to be open to change to have that creativity going, because, yes, resources are constrained. We need to make sure that we don't have the luxury again of time, we cannot wait. We cannot pause. We cannot say we're not doing things. We need to do it but in a different fashion.

 

I think that is where Heineken is very good around that good is good enough mindset that we keep on going probably not as broad as we expected, but let's do it, let's capitalize the benefits. When we have better days, we will continue.

 

Also, I think that is very important for us. Having this global footprint, then we can leverage it because not everyone is at the same moment or the same stage in the recession. How can we leverage the resources from another country or another continent? Then how do we reuse that, that is also where the power of the network, we call it internally, it's also been a very good option for us. That is something that we're also doing at the moment.

 

Marcelo: Excellent. We have many colleagues watching this interview in HITEC, and in Thoughtworks, and in many different parts of the world. They're looking at you, a woman in a leadership position in technology, which we would like to see more, to be honest with you. I'm sure they're getting inspired. All the stories you're sharing, how we're going through this transformation in Heineken, what is your personal advice to those that are listening and thinking, "I want to be like Gaby in five years from now."

 

Gabriela: Oh, boy, that is a good question. I think being a female on a male-dominant function, but also being a female on a male-dominant industry. Different advices. I think that probably for me, the first one is around staying true to your values, is staying true to your values, staying true to yourself. I think that is something very important that I learned very early on in my career.