How lipstick maker Revlon turned around its business with IT

[protected-iframe id=”13d7ef27b4c5eb8d75c26156f3731604-14960843-61002135″ info=”http://new.livestream.com/accounts/74987/events/2117818/videos/21970225/player?autoPlay=false&height=360&mute=false&width=640″ width=”640″ height=”360″ frameborder=”0″ scrolling=”no”]
Transcription details:
Date:
20-Jun-2013
Input sound file:
1012.Batch 3

Transcription results:
Session Name: How Infrastructure Can Transform Business Success

Joe Weinman
Dave Ohara
David Giambruno
Cynthia Stoddard

Joe Weinman 00:05
This presentation/chat should be fascinating, it’s actually two CIOs. And by way of a quick introduction there is a theory out there, which I don’t ascribe to, that the public cloud in particular, will take over all IT. And I’ve written extensively about why that’s not the case, and so there’s a little counterpoint in the public private cloud debate.
Joe Weinman 00:31
We have two CIOs, one is David Giambruno who is the CIO and SVP at Revlon. And then Cynthia Stoddard, who is the same at NetApp. And she’s actually coming in as a CIO and not necessarily a vendor. And so we’ve got Dave Ohara who’s going to moderate this discussion, but we’re actually going to start with a presentation from David. So if we could just bring everyone out on stage to a warm welcome.

[applause]
Dave Ohara 01:04
So we have a lot to go over naturally, I want to start off with Dave Giambruno is going to give us a little overview about Revlon and what’s going on in their infrastructure.
David Giambruno 01:15
Hi. So, just to give everybody some context, I’m going to whip through these slides, so as Cynthia and I talk, and it’ll just to give everybody kind of a frame of reference of how you use an infrastructure. So kind of watching our economy, we’re in this slow growth. In a slow growth environment, there’s only two things you’re going to do – either you’re going to buy companies or you’re going to take market share. And so you need to have really the ability to fail fast, fail cheap. The ability to react, make big data into little data that’s actionable for your company. Really the only competitive advantage becomes speed. And I think if you look around the room what people are talking about is really about the speed – the speed to change, the speed really to do anything.
David Giambruno 02:01
And so, this is one of funny slides out there that one of my guys found, showing the adoption cycle in enterprise IT. So, it’s really ignore, ignore, ignore, no, no, I said no, oh shit, right. And everybody knows what CIO means – career is over. Right.

[laughter]

David Giambruno 02:17 I think the average tenure of a CIO is something like 18 months. So it’s really how do you break that cycle and how do you get in front of it. And it’s kind of interesting what we’ve done at Revlon, I kind of joke, I make lipstick. So, we have an internal cloud running 97% of our total compute running north of six nines. I have 531 applications running on that, that’s everything from databases, email, ERPs, MRPs, you name it, we own it, it’s running on there. By the way, I’ve had cost avoidance savings of 70 million bucks, the stats are pretty cool. Our card average is 15 automated application moves a month, that’s moving applications around Revlon to where they’re needed. We average 14,000 transactions a second, we average a change rate of 40 terabytes a week, we in-source our own DR, we just under a gigabyte a second in DR. Our average network speed is 550 megs a second. Oh and I’ve reduced data center power by 72%. Awesome, right? And again I always joke I make a lipstick and we did this.

David Giambruno 03:27 So what’s the business value? That’s all great from a technology perspective, but this is really the thing, I think business alignments are rather simple things, do what they want, faster, cheaper, better, with counsel so I don’t let them hurt themselves. So since 2007 since we’ve implemented this internal cloud, we’ve increased our project through-put by 420% and have not increased what we spend. We’ve kept spend flat. So it’s really taking the infrastructure out of the way so we can focus on what people want to do faster, cheaper, better. Oh and by the way, we’ve only had one project go late in all that time. We haven’t missed anything else, no money, so the availability, the capability of the infrastructure, literally getting it out of way, is what provides a competitive advantage for us and gives us speed.

David Giambruno 04:18 So if you look five years ago at Revlon’s balance sheet, I wouldn’t call it great, I would argue that we are now one of the most profitable cosmetic companies in the world. And it’s not because of what I did, it’s only what I did to let the business units do what they need to do. And what do you do when you transform yourself, I was so upset because Google pimped their data center first, but that is our data center. We took so much stuff out that we had to put lights back in. So we’re just kind of fun. So our outcomes, we’re 90% in-sourced, we’re really a challenge to outsourcers. Can you compete with us on cost and technical capability? We have no COLO, we have one server and external DR, we trust but verify our cost and capabilities. We wheel the technology, we’re constantly delivering new capability, automation to drive scalability. So when we first started we averaged one physical server to one virtual, we’re now one to 34. That’s a 500% increase in capacity with no investment, in this dogmatic pursuit of simplicity. We only have one of everything, we call it kind of the southwest of computing. And the paradigm shifts are around cost, speed, capabilities, and expectations. Not only of the business, but of ourselves and creating a culture of change, because to a large degree technology is easy, people are hard.

David Giambruno 05:38 So does the model work? In the last two years we’ve had three major DR events. So before, and by the way, we call these little O boxes dribs, that’s all our capacity around the world, outside of our major data center. The picture on the right is our Venezuela factory and an entire city block burning. In an hour and 40 minutes is running in our internal DR site, we did not miss a transaction, and everybody went back to work because we were able to spin up virtual desktops, let everybody work. Move our virtual PBX out, no issues. This was kind of fun, we called in a prophylactic DR. So when Sandy hit the east coast, of the United States, we moved our New York and New Jersey data centers, one guy, slide it back to North Carolina. Monday morning when everything was fine, we slide everything back. No issues, no one even knew what happened. Three weeks ago our London office flooded from construction, it was running in DR in 20 minutes, again no transactions missed. Nothing. So does the model work? Absolutely.

David Giambruno 06:42 So, in having it all in one place it really gives you the ability to change, and this was one of the unintended consequences that we had out of this, that with our common cloud infrastructure, we’re literally replicating every change in Revlon every 15 minutes to our DR. With everything being a file, we literally had all of our data all of our applications in one place. We’re able to build a master data model, and we’re able to build to build a big data model. Now this goes counter intuitive, we literally normalized all the data in Revlon, we called it chewing glass. So we have a master left had column, it doesn’t fit in there, it goes in a bit bucket and we keep normalizing it, so we’re able to do things with it.

David Giambruno 07:20 So what does it look like? So we’re collapsing 21 ERPs into one, that’s a lot of fun. Our first country took us 377 days, our second country 14 days, our third country now takes us six hours, our fourth country was six hours. We’re now down to six hours to deploy a country. We’re running a year ahead of schedule and 40% under budget to deploy a global ERP. So again the business value the capability of having an agile infrastructure and what you do with it, and then the framework, it’s all about mobility. It’s kind of like browser hell of the ’90s is no mobility for me as a CIO, because I have to test everything, those are all my phones. It’s awesome, my wife can find me anywhere.

[laughter]

David Giambruno 08:04 But it’s really what we see as this big use of bid data, making big data into little actionable information, and with our mobility capabilities we’re actually pushing these applications out and creating an internal market place to give people the information and actions that they need to do their jobs. And it’s really providing that actionable information around doing things. Because again it’s all about giving people the right information to act to provide speed for a competitive advantage.

Dave Ohara 08:36 Thanks a lot Dave that’s a great where things are, and normally that would be the end of the story. But I think there’s actually a lot more going on, because with this infrastructure actually Cynthia maybe you can share thoughts from a CIO perspective for this type of infrastructure where things are going.

Cynthia Stoddard 08:55 Absolutely, I think what David described is really a model IT organization embracing new technology and moving forward, taking it at the beginning of the curve. Unfortunately I would say a lot of people aren’t in that same space but you can get into that same space by really looking at what is available. And the vision that I have and that I share with other CIOs, is that an IT organization will become the broker of services. So understand those capabilities as David described with that solid internal infrastructure, but also look outside of the company too. To the capabilities that a hybrid cloud would give you, so you don’t have to build everything, there may be some business capabilities that are short lived that might be appropriate to live on a public cloud. There might be some other capabilities that are very standard business practices that you can buy through a SAS provider. But again, having that agile infrastructure as was described within your infrastructure to be able to take advantage of it but then link out to other services. So the IT organization of the future will really need to understand the components and be able to bring them together, and still deliver the high level of service that David described.

Dave Ohara 10:26 So Dave, maybe you can add more like– that’s great where you’re at, further out what’s on your mind.

David Giambruno 10:32 So if you kind of think about how the worlds, it’s all about speed right, and giving the business intelligence. And so when I think about covering the cool infrastructures– and by the way when we started there was no external cloud so it really wasn’t an option. So we’re constantly testing ourselves can we deliver it at the right place at the right capability. And to me that’s just ice cream, you want vanilla, chocolate, or strawberry, whatever works for you. But for us, it’s about wheeling information. In case you missed it, we live in the information age. So the abilities for Revlon to grow right it’s about all the social data, figuring out the market, giving that information to the different business teams to new product development especially for us it’s about new product development, it’s really about marketing and providing them that information in a really cohesive place for them to make plans. And it’s also the speed of reaction, so Revlon is a consignment business. If our sales channel doesn’t sell it, they give it back and they want a check. So demand for task accuracy and having enough information to really, the better we are at that the better the more profitable we are the better we can grow. And conversely it’s not just about taking market share, it’s seeing when you’re losing market share, and giving the business the– is it profitable to take this market share back, should we go after new markets? It’s all the questions that happen every day, but I would say the pace of change is accelerating, we all see that. It’s not just the technology change, right?

Cynthia Stoddard 12:07 I would absolutely agree. Because many of what we have done in the past is really looking in the rear view mirror to report and provide. But really what we need to do as you described, is we need to be proactive and start to predict. So the analytics and the predictive analytics not just staying within your four walls with your own information, but being able to take your information and combine it with all the rich media information and then deliver that information setbacks so that decisions can be made like that.

Dave Ohara 12:42 I think what comes to mind when you say something like that, maybe you can comment a little on the cultural change. Because even when you talk about all this stuff going, your IT organization all of a sudden is thought of as instead of reactive it’s out there getting ready for things. Maybe what happens in a culture because you’ve been doing this for awhile–

David Giambruno 13:00 So the life lesson I learned a long time ago is that humans area meaning making machines, they make value of whatever you’re doing today. And the challenge is really not the technology, it’s twiddling bits. But as you change your operational models, it’s really taking your teams through that change and showing how they add value. And once you can figure that out, change happens really quickly. It’s also building a culture of change where I would argue a lot of IT organizations and for people out here from an entrepreneurial– technology organizations for a large degree are very conservative. It’s more a fear of loss, I’m going to mess something up then it is actually embracing change. And so once you understand that giving people the disconnection of the infrastructure for us was the thing where I could tell my people, Go make mistakes, it doesn’t cost us anything. Go fail, find out when it doesn’t work. That’s actually more important. But creating that environment to people to allow them to fail, to figure out what to do, to know the difference between I know and I think. Because again, CIO means career is over if you’re with–

Cynthia Stoddard 14:16 And we don’t like that.

David Giambruno 14:17 No, no.

Cynthia Stoddard 14:19 Yeah, no I totally agree. You have to create an environment where people can innovate and feel safe innovating and trying new things out. In our organization we’ve actually taken our innovation group of just very small group of people and put them to the side with a lab and they play with new technology, they look at new ways of doing things, and they have the freedom to do whatever they want really. And to David’s point, if you’re going to fail, you fail fast. But when you don’t fail, the rewards are huge and the value of that is brought back to the organization is enormous.

David Giambruno 14:56 And it’s even, and I say this very flipply but I’m like a technology dealer. You see the proliferation of technology in the consumer, like that slide, and the ability once you create that culture of change–

Dave Ohara 15:12 That mindset of–

David Giambruno 15:12 Yeah.

Cynthia Stoddard 15:13 Yeah.

David Giambruno 15:14 But you actually get a reinforcing cycle with the business units. Where I’m like, Hey we got this for you, try it. Hey we got this for you try it. What do you think? Because they don’t understand what we do, we’ve got that job you can’t explain to your mother really. But when you show someone technology and they can do it, then it creates a dialogue and we can then work with people. Because it’s about changing frame of reference.

Cynthia Stoddard 15:35 And I would say that it also builds a certain level of trust and they’ll come back to you and say, What do you think, I have this problem, how can I approach it? Do you have any ideas, because they see those innovative ideas being brought back?

David Giambruno 15:49 And probably the most thing is for my organization is we’re just here to help. I’m never going to be a revenue source for Revlon, but we can sure help. And it’s really the attitude of, “Look we’re going to help you with technology, we’re going to help you with business process, we going to figure out how to automate and how to move the ball forward for you.”

Dave Ohara 16:08 So we have time, a couple of minutes, is there a question from the audience that anybody feels like they want to ask of this group? Anybody jumping up? So actually I have a question. The whole idea of the conversion infrastructure, where are things going? Because even though you’re talking about people and issuing technology, but also where do you see the direction of the pieces almost like colliding or overlapping?

Cynthia Stoddard 16:34 I have an opinion. I think it’s all about storage myself.

[laughter]

Cynthia Stoddard 16:38 I mean data continues to grow, and we need to have the proper infrastructure, and I think David described it perfectly with the agility he has with what he’s built out in his data center.

David Giambruno 16:49 From an organizational prospective, I would say there’s a crossroads. Most of you will talk in terms of servers, stacks, storage stacks; in my world, it’s everything’s horizontal. So my storage network and–