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November 27, 2020

BTOES From Home - SPEAKER SPOTLIGHT : Insights from Twitter’s transformation journey, aligning strategy, operations and execution

Courtesy of Twitter's Lakshmi Shankar, below is a transcript of his speaking session on 'Insights from Twitter’s transformation journey, aligning strategy, operations and execution' to Build a Thriving Enterprise that took place at BTOES From Home.

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Session Information:

Insights from Twitter’s transformation journey, aligning strategy, operations and execution

Twitter’s is the world’s town square, where every person irrespective of their background or beliefs, can see & talk about what’s happening, learn & share perspectives, and solve important & existential problems together (e.g. #blacklivesmatter, #climatechange, #metoo).

Despite being one of the fastest companies to grow to $1Bn revenues in the history of the tech sector, Twitter has in recent times fallen into tough times with several rounds of layoffs, product shutdowns and earnings misses.

Since 2018, the company has embarked on a bold new vision and a strategy to transform itself and at its center has been a quiet focus on operational excellence through driving better operating rhythm & alignment, clearer decision making & accountability and greater focus on high performance & incentives - all while retaining the company's unique culture and world class talent. 

In this presentation, I would like to share some of the learnings from leading this business transformation that all operational practitioners from heads of operations at start-ups to CxOs of Fortune 500 organizations, would find insightful, valuable and leverageable, to their worlds. 

Session Transcript:

Good morning, good afternoon & good evening, wherever you are gives me immense pleasure to be a speaker at BTOES this year and over the course of the next 30 minutes i want to share with you the insights from twitter's transformation journey and the magic that happens when you align strategy operations and execution.

My name is Lakshmi Shankar. I'm a senior director of twitter product strategy and operations. I actually believe what I am talking about and there's a recurring theme is to talk about the learnings from twitter's transformation journey and the reason I believe it's important to focus on learnings is because of this very famous quote and favorite code of mine from jack welsh around an organization's ability to learn and translate that learning into action rapidly is the ultimate competitive advantage and over the course of these 30 minutes.

I really want to focus on those learnings but to get to those learnings i believe it's important to talk about what is twitter and how we started the highs and the lows and those incredible turnaround years which really provided the foundation for those learnings that hopefully we are learning from I'm confident in fact that we're learning from and I want to share here with those learnings as i believe that they will not only present the competitive advantage for us.

The Twitter the company going forwards but hopefully some of these learnings can be applicable to YouTube. I want to qualify that everything I'm about to share are my opinions and with that liberty, let me start off by talking about twitter.

Screenshot (46)-1Twitter many of you are probably uh very familiar with is a social media platform along with others that you may have used such as Instagram Facebook snapchat and many of you are probably aware of how and why you use it and like with many social media platforms even if you're not aware I'm very certain that your kids are and kids all over the world have really taken up to social media platforms like twitter, but perhaps the best way in which you probably come across twitter is through politicians and celebrities um and entertainers around the world.

Who use our platform and none more so than probably what's topical um on top of all our minds right at the moment and um but the platform is not just used by politicians and it's not just used by politicians to talk through to uh or connect with their audience and followers in a direct way,

It's also used to start very powerful movements to connect the world in one voice and none more so than the me too movement which I'm very proud to say really was [Music] a phenomenal example of the use of social media for good and specifically twitter to really kick start this movement that started uh in in 2016 with Alicia Milano tweeting me too and really awakened the world to this uh problem.

That we had uh and twitter provided the the the voice for everybody to pour their concerns and their uh challenges that they went through um and this platform has also done that in many other circumstances um black life matters was another platform.

That was another movement that twitter gave uh voice to and all the way through to uh the example that you see here with great reaching out to trump and to and other politicians to enlighten people around the importance of climate change and what an incredible existential threat.

That it poses and one of the things that I'm certainly proud of as a platform twitter has provided is the level playing field uh the opportunity for every voice no matter where you come from what background you have what are your beliefs that this platform sees none only sees your voice and only hears your voice and wants to amplify your voice.

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So that you can connect and you avoid and your opinions are heard by others the power of social media and the power of such platforms is also to remind us what is precious in life and none more so than the outpouring that we saw uh with the unfortunate accident and us saying goodbye the world saying goodbye to kobe bryant and his daughter and other members.

Were unfortunate in the helicopter accident that happened earlier this year and we saw girl that as a trending uh globally and reminded us of this incredible relationship between a father and a daughter and platforms like twitter has this incredible ability to move you and also introduced, a whole new vernacular uh that we use on a day-to-day basis.

That we have not used before and we're also spending incredible amount of time on the platform like never before in fact uh most recent study found that uh the average person uh in the world is spending around five years and four months on social media like pretty much certain that that was not the case five years ago and this time.

That we're spending in front of our screens in this way is also changing the way we buy and and this is clearly uh something that is being capitalized upon not only by platforms like twitter who are spending incredible who are making incredible amount of money uh through advertising on on their platform uh to capitalize on the time that you're spending on on platforms like us but also others um this the the market for global digital ad sales sees seems to see no bound and we're seeing a phenomenal transition from traditional advertising uh through to um digital advertising and this trend is set to continue and we're seeing more and more normal ways in which everyday companies are using platforms like twitter to connect with their audiences and also using new formats such as videos clips even sometimes virtual reality augmented reality to provide interesting experiences for you to remember and recall these products.

Such that when you were to buy in the real world or maybe through online uh that it yields to a conversion purely because this is where you're spending your time and people and advertisers recognize it and want to capitalize on brand recognition and that's twitter that's how that's the platform that's the power of the platform and we talked about what actually how we make money and and i want to switch gears into her how it all started um and the highs and lows uh because i believe.

That's quite important to understand and set that context uh for some of the critical uh turnaround that we did and the learnings that i will go on to in a moment so twitter started in 2006. uh with a simple uh idea uh that you saw uh twitter uh the jack dorsey our ceo um sketch out and you can see that on the on the left hand side and um and it just caught on fire something about the way uh the simplicity of the platform the ability to just uh tweet out.

What you are thinking um to the world it was just a very new phenomena on that time and it really caught on and we saw as with any great technology that starts off initially an incredible surge in early adopters and and then we crossed the chasm and we really hit the early majority late majority and and then essentially the world will caught up and twitter became from a product to a platform um and uh and and it became a social uh plot media platform it became a micro blogging platform and essentially it brought what was initially.

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A platform for somebody to tweet out what they are thinking or feeling to professional publishers who wanted to use this to publish their content on the platform and the moment you had an audience and a set of professional uh people who are preparing content for that audience then it attracted advertisers to want to advertise and capitalize on the time.

That people are spending on content and reading content and really that is the that's the um the the incredible power of that platform and how twitter grew uh through this three-sided marketplace and uh in fact 2013 twitter uh was one of the first few companies uh to uh to to uh ipo uh in terms of the number of years it took it's only 7.6 years from the time.

It started and that's fairly early and and fairly soon for uh this industry as you can see from some of the other comparable that we saw and from this incredible high we started uh experiencing some incredible lows um and uh a platform uh for no real reason other than uh you know having content and publishers and advertisers just as how quickly.

It grew um it it started declining um and and here as you can see on this graphic our revenue started really uh unfortunately plummeting and um and that's because our audiences started deserting uh customers started moving on to other platforms some are me too platforms that we saw and some are just other ways in which we're capitalizing uh that they wanted to spend their their time and and energy and so uh moment.

We start stopped losing uh eyeballs uh and started really not providing value to our customers um that really was uh the biggest uh challenge that we faced and come fast forward to 2016 um we really hit the at the very bottom and there were rumors spreading around uh twitter um is for sale uh there are many people who are interested in [Music] in in acquiring the company and um around about that time 2016 was also the elections.

If you recall and uh we had challenges um uh uh macroeconomic challenges but also political challenges in terms of Russian interference in elections through um through social media companies like twitter and also there was a a lot of challenges we faced in terms of the platform which became very um toxic as people uh started expressing but felt abuse both um both abused in terms of uh the words but also how they were made to feel and and very unsafe um and uh and mental harm that the platform started causing.

So we started seeing incredible levels of challenges and we really lost our way as a platform and surprise uh it wasn't a surprise that we were under incredible scrutiny both from regulators um as well as uh from um the world at largest what is this platform and have you completely lost our way and and then really started the turnaround yes uh which is really the beginning of of some of our learnings but I will quickly talk through how we turned around and then move on to our learnings.

So around about 2016 jack had come back and uh and he had almost spent a year as a ceo returning back to the company that he helped found he built a new set of leaders around him and and uh this picture the person on the left-hand side is Leslie berlin who's our cmo and uh and she and others really started looking at what happened um and why was twitter so incredibly successful um and one of the first ipo uh saw this incredible desertion of of people on the platform and revenues plummeting and really we started looking at okay of the three-sided market play where do we need to concentrate what happened who are we missing.

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Who do we need to get um and one of the biggest uh insights is that at the end of the day as with any three-sided market play where do you start what matters most I hope we never forget because there's a big learning here is at the end of the day it's the customers that matters most where there are customers publishers will come where there are publishers and customers and you're spending your time advertisers will follow and so we really went back to fundamentals of why do customers choose twitter and we spent incredible amount of time really understanding our customers and what are our differentiators and we understood.

It's personalization selection speed and the social interaction that you get on the platform and that's really why people come to twitter and so that really forced us to think about okay twitter is about what's happening and we have the ability to tell you what's happening around the world at speed having given you the widest selection um and the ability to take advantage of some of the social dynamics of sharing um uh what you're thinking at with your friends and also the world at large um and that really kicks kick-started our focus on branding and explaining to our customers why to use the platform twitter is about seeing what's happening following your interest joining the conversation and staying in the know now.

If you look at this uh you know in in in hindsight it's incredible uh that of course this is what twitter is about but at that time um believe you me uh the world as well as internally we were fairly fairly unclear on why use the platform and why customers should hire twitter and it's it's also not a coincidence that our resurgence and a turnaround also coincided with the heavy use of the platform by uh the world at large and uh not least uh the president um and if i were to really look at though what was the core uh is this realization of identity and uh and also a purpose uh the power of a purpose-driven company is incredible and it's incredibly important why what you're chasing and why it matters not least for explaining to the world but also for retaining your talent and uh it's it's fairly foundational for us and so we were very clear twitter is about what's happening and our mission is to serve the public conversation by explaining to people about what's happening and why do we believe in this because we believe that by serving the public conversation.

We can help people learn something new solve get understand each other's perspectives and solve some of the most um existential problems that face humanity uh and it's an incredibly noble mission uh and once that mission is clear it became very uh very clear as to why we need to do what we need to do and so we were very clear that our mission is to serve the public conversation we want to serve that conversation we need to make that conversation healthier and more sick and that laser focus on who are we what matters uh and where are we going um translated into um our our turnaround and and here this this graph that i'm showing is a depiction of our share price uh from the lows that you saw in 2016 to the steady rise that we're seeing over there over time um through just this fundamental focus uh which is the the crux to our turnaround and certainly.

If I go back to number of users it's been it's been steadily coming back uh and users are choosing the platform and revenues are certainly back on the up and our market cap is never been healthier and so that is our turnaround and so now if i peel the layers and really try to synthesize these learnings because ultimately those are the competitive advantage for twitter going forwards and i want to share as i said with you uh because i believe these are fairly uh transcending no matter what size of the organization.

You are or what your customers what customers you're serving uh be it enterprise or b2c so let me start off with uh the fundamental learnings from the twitter's turnaround story hopefully you already picked it up it's the focus on customers that is what we lost initially um and that's what we needed to refine as to why customers hire us uh it's actually some of the most fundamental questions and it's actually fairly obvious uh question but it's not a question that we deeply think about and I want to give an example um from uh in a very insightful case study uh from clayton Christiansen the hobbit professor uh wrote a book uh called competing against luck.

Which I highly recommend and the genesis of it was from an article he published in Harvard business review around um why cust what customers really want and it turns out that we really don't know at the surface level and it requires us to really dig deeper and he highlights in that case study an example of McDonald's seeing a surge in customers using uh buying milkshakes at 6 A.M. in the morning and the sale of milkshake just showed no bounce and they tried to replace it with coffee doughnuts but nothing really took up as much as this category of food milkshake and and so really did the customers want milkshake is that what what it is but you know it really didn't make sense and it's only after studying the customer and and not just at the time of buying but actually.

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What are they using this platform what are they using um the milkshake for that you really start to understand why customers are hiring milkshake as opposed to coffee or uh or donuts or anything else and it turns out that in the long rush hour traffic um that the milkshake provides the right amount of cold coldness as well as um viscosity uh that lasts the duration of their entire uh travel and and fills them up so that they don't become hungry uh and so and it's quick.

When they come and get and everything else uh be it coffee or donuts uh just didn't do that trick and so there were some deep deep functional and emotional needs uh that that um in the circumstance of a six a.m in the morning when they're about to go to work um that they chose a milkshake for as opposed to other competing products like a coffee or donuts which is the reason why customers chose uh milkshake and and really that level of depth and insight is is codified in in design thinking uh and it's really now how we build products and so we are now so laser focused on why customers hire twitter and everything.

We build is is focused around having deep level of customer empathy and that empathy leading to hypothesis on a problem and what solutions and workarounds they have and then experimenting taking many many shots at goal because it's still hard to know the very single solution to the problem so optimizing for how many shots you have at goal as opposed to how many goals you score through this incredible experimentation that we need to do and and then striking hopefully gold and then very quickly executing and not still less stressed on your laurels but come back and see did that actually do the trick and this combination of design thinking lean startup and agile uh is is the crux of how we build our products uh these days and it's probably one of the most important learning that i want to leave you with today.

The second is operating structures or operating model and this is quite quite quite a very subtle thing which is uh twitter uh was a in the uh prior to the turnaround time it was organized um in terms of gms and product gms and multiple product gms and we started twitching into a functional based organization uh recognizing fundamentally that we're a single product and a product-based organization works well when you have multiple products and you can actually create fully uh full-stack teams within each of those product areas and make gm's responsible for product growth as well as p l to deliver on that goals and and in a single product company just didn't make sense um and so we re-opted the company um and and really picked the right set of people at the the this stage of our company um into a functional structure.

Where we recognize it's a single product company we need to protect the end-to-end customer experience and uh have a very clear set of priorities which we're going to try and solve uh through uh through uh resourcing and leverage the benefits of the functional talent of engineers product managers designers researchers quality assurance to really build the best product experience that we can for our customers and it does add complexity.

I agree with agree with you there and it does create uh potentially challenges on accountability and incentives um but this structure worked for us and the lesson here really is about making sure that you understand the right operating structure to deliver on the customer strategy and to solve for some of the challenges that we had around accountability and incentive which is the third learning we really invested in our objectives and key results where we're very clear on where we were going.

What's our mission what's our customer strategy and that record those were codified in terms of what do we want to achieve and how do we know if we're successful and I had the pleasure of rolling out the ok framework for twitter where we codified this in terms of what do we want to do every year what do we want to do on every six months and quarterly basis and what do we want to do on a monthly basis and review and measure um and you don't move anything that you don't measure uh and so this became an obsession for us to really make sure that the the shots we were taking um were ultimately yielding the top line growth and the revenues that we sought and we codified all of this under four main objectives for us.

That were transcending across the function so it doesn't matter which functions you were you knew that you were working on one of those four objectives if not potentially all of those four objectives and uh the way we build our product road maps and wave teams build planet road maps is by looking at these objectives what do we want to achieve in the next 12 to 18 months codifying it in terms of work streams and projects and having teams do a portfolio balance of work that needs to be done across all of these objectives and allocate resources.

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So that there's clarity from an individual contributor to a team to a function to the company how what they do aligns all the way through to what matters for the company and the purpose that we exist as twitter um then one of the things that we also started learning is okay so we have clarity in our strategy uh we have uh clarity in our operating structure and we have aligned with align accountability uh with incentives and so then the next question is well how do you then start to scale um we started investing in a set of processes and the processes should follow systems and tools and so the processes that we want to really standardize is uh is clarity in what our objectives and key results um processes in how those ok translates into our roadmaps and how we do resource balancing and how that translates into the actual work.

That's being done by their team and having complete visibility traceability uh to try and actually deliver on the accountability that we're seeking so that it's incredibly objective and uh processes uh are an incredibly uh key thing to get right because you could overcook it and it becomes very bureaucratic and so it's important to try and actually get the right uh process for the state of the company that you are in and so we spend a lot of time to understand the hierarchy of needs that exists across these three layers the pyramid that I showed in the previous diagram and to whom do those needs actually exist.

So that we don't put an overbearing process and needs for an ic who all they care about at the end of the day is that let me know what i need to build and so we really focused on what is needed at various stages of the of the hierarchy and i then started investing in in tooling by looking at what exists um and and really analyzing uh is there one tool that fits all or the tools that uh we may need to go into a hybrid uh in terms of best of breed uh for what we need at every stage and then rolling out these tools over a period of time.

So that we build efficiency uh and reduce as much as possible uh manual uh work and and errors that comes with it and hopefully systematize and automate a lot of this to try and actually give us the scale that we are seeking as twitter started turning around and growing and so um the fifth learning which i want to talk about is so at this stage uh we've got the strategy uh we've got the right structure we put in the right accountability and incentives and we started standardizing certain processes and tooling to help us scale but ultimately.

It's about the culture and and so we had to also evolve how we work and some of the things that are very sacrosanct about twitter's culture and also some of the things that are uh forced upon us because of of the pandemic world that we live in is around remote and virtual workforce and we were one of the first few companies that actually declared that we want to be able to work have people work remotely before pandemic forced that as a reality and so we were well on that way and also decentralization moving the centric city from San Francisco.

So that anybody anywhere from any background is able to work on the product and talent and talent alone matters and how do you then preserve in a decentralized world where people are operating remote this deep connection back to the mission because we believe that was as i mentioned earlier the creed to turning around a mission-driven company is critical uh for uh for uh connecting the inner purpose to the company's uh broader purpose and ultimately.

Then empower people to then do their best work and so we spend a lot of time thinking about this and this is an ongoing work we started reflecting on the org structure and under functional model how can we still have greater clarity and roles and responsibilities and push decision making down push empowering teams down a lot more we also looked at the the role of meetings and how can we actually encourage uh asynchronous communication as much as possible.

Then we started focusing as well on as I said autonomy and and decision making um and and one of the biggest areas that we are we are quite proud of as a company that we're directly moving around is this notion of uh holacracy where you're moving away from a traditional hierarchy model into a model that actually gives power and gives decision making to teams local teams and teams to swarm on local problems and and importantly problems that you identify as priority but you are not confined to the org structures or um the hierarchy that you are part of and this is incredible um because you can then have these incredibly uh i mean uh amirbio teams that are swarming around into various problems and clusters solve them and then move on.

So when we have problems with how we're on roading as a problem we're not confining it to be the teams that are actually responsible for onboarding to solve but anybody anywhere in the company who has insights uh saul goes and swarms on that problem and and and solves that problem because that's one of our priorities back to the idea of shared priorities um and and then moves on to the next problem based on where the priorities are so it removes the shackles of hierarchy and reporting lines and power back to empowering where the the teams and the circles that knows and are closest to the problem space to make the decisions.

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That are required and also uh we are we we are thinking a lot about you know what are the different types of decisions that needs to be made it turns out there are actually very very few decisions that need to be made and very few times of a year that those decisions need to be made that you need to get absolutely right those type a type decisions where you need to have a highest level of certainty as depicted in this diagram but many many times you can actually have decisions that are much more empowered by the teams on on the on the ground and and it's okay.

If you don't get it right it's okay um and and as i said you encourage teams to take multiple shots on goal um and and recognizing uh what are type a type decisions that needs this command and control and hierarchy and what are type b type decisions where you accept a level of uncertainty and uh and getting it wrong but learning quickly taking multiple shots at goal is one of the critical changes that we uh did and are continuing to make uh in in in helping us.

That has helped us through our turnaround and so um i want to take this moment to bring it all together um those five key lessons and i want to try and rewind back to twitter and and as i said you know it started with a simple idea and where we are now is seeing uh the back of this incredible turnaround um and in terms of where twitter can be be it in uh 10 years from now in 2030 or in in 20 years from around 2040 or anytime in the future.

The only thing that really matters are these key learnings because those are a competitive advantage and the learnings around focusing on your customers making sure your operating structures continue to evolve and making sure there's alignment in accountability incentives and standardizing the right processes at the right stage of your company and then systematizing it and then evolving the culture every step of the way are some of the key learnings and my takeaways for you all from hopefully this session and i truly believe by bringing it all together that this will be twitter's fundamental these learnings will be twitter's ultimate competitive advantage and i hope they will be yours too with that I'll pause it's been a pleasure.

Thank You.

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About the Author

download - 2020-11-27T204909.163Lakshmi Shankar,
Senior Director, Strategy & Operations,
Twitter.

Internet Executive with 15+ years of experience including general management of mid to large size organizations, product development and business operations, and strategy. Currently senior executive within Twitter, responsible for Consumer product strategy and operations globally, with the responsibility of growing users and usage for Twitter, through delivering on Twitter's mission. Prior to Twitter, held senior leadership roles at IBM product & engineering in enterprise software technologies and previously was the global director of EY operations management consulting practice. Graduate of Software Engineering from Imperial College London and a Sloan Fellow from Stanford Business School. Specialities: general management, product development, corporate development, business operations, strategy, P&L management, business transformation & turnarounds.

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