Lessons Learned in the Digital Transformation of the Frontline Workforce

Christina Bechhold Russ, Director Ventures @ Samsung Next; Daniel Sztutwojner, Chief Customer Officer @ Beekeeper

Ascent Conference 2019

Christina Bechhold Russ [00:00:07] So quick show of hands, how many people would say that their job is desk based, so to sit in front of a computer, take meetings, phone calls most of the day. Most people, OK, so believe it or not, we’re actually in the minority, 80 percent of the world’s workforce does not sit at a desk during the day. And what’s interesting is that when you look at some of the most successful enterprise software companies in the world, Microsoft, Salesforce, Slack, they’re actually going after that 20 percent. And so what we’re gonna talk about today is the opportunity for that 80 percent of the world, the majority of workers that are a little bit forgotten by technology, actually, and beekeeper’s doing some really interesting work, focusing on those so we can start with how we should sort of define a frontline worker and why this market should be exciting for for tech entrepreneurs.

Daniel Sztutwojner [00:01:02] So the definition for frontline workers actually is if you’re looking at coverage, is any employee that is working in a service related functions or servicing a customer, for example, an employee in a restaurant, in a retail store, or also an employee that is helping build a product that will be an employee in a manufacturing plant. So that’s our scope of frontline employees. And why this market is so interesting, as you mentioned before, is because actually they are 600 million workers. They’re still workers in the world, but there are almost two billion front line employees in the entire world as means almost 80 percent of the population are frontline that don’t have access to a computer, you know, daily basis or don’t have access to a corporate e-mail address. So the question is, how can companies communicate and interact with these employees? And for us, this represents a multibillion dollar market. And we know that, for example, in the United States, almost 84 percent of all workers own a mobile device and more than 75 percent of them use it daily for work related communication.

Christina Bechhold Russ [00:02:10] And do you think there’s any particular reason why these verticals or maybe a little further behind on digital transformation or why they’re particularly interested in these kinds of solutions now?

Daniel Sztutwojner [00:02:20] I mean, I think behind it’s it’s something rather new. There were they never have access to technology. Many of these employees, they don’t even have a computer at home or Internet, but many of them today own a mobile device. So this is actually opening a new market for companies to leverage that and connect with their employees.

Christina Bechhold Russ [00:02:39] And so could you talk us through what are some of the key problems that these these frontline sort of frontline workforce needs solving are more maybe unique to these verticals?

Daniel Sztutwojner [00:02:50] I mean, the way we help these companies be better is mainly allow their employees to work better together. I mean, there are very disconnected. So there are two areas that we see that are very important for these type of organizations. The first one is align their employees with our companies on the second one is driving operational efficiency. How can they be more efficient? So for the first one, aligning their employees to their companies? It’s very important on both sides for the employers is very important to be able to share the strategy of the company. What’s their core values, what’s their mission, so the employees can identify themselves with that. Also, employees today are people in general are used to have a voice. I mean, thanks to social media, if you think of Twitter or Facebook, that gives us a voice. People are used to share their opinions and they’re also expecting this today in their companies. So it’s very important for them to really feel engaged within their organizations that they have a voice, that they can share ideas around innovation, around sustainability, that they can have an impact. And this is one of the areas that we help them solve. And these type of organizations need the alignment with their employees, especially today with a tight labor market driving. Engagement among the employees is very important because the cost of finding new talent, training them, develop them, that’s very expensive. And on the other side, on driving operational efficiency, that’s key because they can achieve more with less if the employees. And so we keep our employees can access the information directly from their mobile devices when they have to work with whom they have to work, what type of tasks they need to do, do they know what’s their team that they are going to be working with? What are they policies, health and safety or procedures that they need to follow in order to work as efficiently as possible. So those are these two main areas that we see these type of organizations need help with.

Christina Bechhold Russ [00:04:41] And and I think, you know, right now a lot of there are a lot of sort of consumer tools that people are employing in enterprise environments that aren’t really built for that. Is that is that right? That’s what you see.

Daniel Sztutwojner [00:04:52] I mean, for example, in Europe, we see what’s up widely use. So employees are actually sharing their personal phone numbers because they have a need to connect with each other. In the U.S., we see more either Facebook groups being created or just a message, text messaging groups, because they have the need to coordinate something natural and they connect with their peers for where their manager is to find out when do I have to work, what do I. To do so, it’s something very common that actually the consumer space to open these market and now we see organizations looking for more specific enterprise ready tools.

Christina Bechhold Russ [00:05:26] And is that do you think that’s why mobile space is is most appropriate for these kinds of use cases versus maybe adopting a desktop solution and just making it mobile friendly?

Daniel Sztutwojner [00:05:38] Definitely. I mean, we when we develop our solution, we interview thousands of front line employees. The way they use technology is different. So just adopting a desktop technology won’t be sufficient and mobile is the only way to reach them. As I mentioned before, 84 percent of the workers own a mobile device on more than 75 percent. You see it for work related communication. So mobile is key. Definitely unassessed gives the flexibility that SaaS offers. I mean, it’s easy to implement, easy to rollout. As the company scales, they can scale with us. So that makes it very efficient. For example, and we’ve been working for the past five years with Mandarin Oriental Hotel Group, and they wanted Starlene when we presented the idea of people to they loved it. They thought, wow, we really need to connect our front line in hotel. Just to give you an idea, 80 percent of the employees don’t have a corporate email address. It’s either housekeeping, food and beverage. So how can I reach them, connect them? They still communicate with bulletin boards and daily briefings. So the seemed like the past hundred years.

Christina Bechhold Russ [00:06:38] And like getting your your ship schedule.

Daniel Sztutwojner [00:06:41] Exactly.

Christina Bechhold Russ [00:06:42] I think there was a story that someone told me about. There was like a woman in San Francisco who worked in a hotel and she had to drive like an hour and a half every week to go and look at the just check posters for the next week.

Daniel Sztutwojner [00:06:52] Exactly. Yeah. And those are things that that that would help solve. But the interesting thing is for for these type of organizations, since they never roll out technology to the front line or the majority, they have never done it. They are very cautious at the beginning. So they might start with a smaller population. In this case. We started with two properties in London and Geneva. They saw how efficient it was actually in a very short period. We were able to show our way and then we scaled to the entire company in a very quick period of time. So that’s the advantage of SAaS.

Christina Bechhold Russ [00:07:27] And how does that land and expand strategy differ for you guys versus more traditional desktop SAaS? Because it’s it is different. It’s not. You know, when you look at the way like Slack was able to grow so quickly, a lot of times it was going into a small engineering team and then they were able to share that with other teams and then sort of push it up from the from the from the bottom up to management. And that doesn’t necessarily work in these verticals.

Daniel Sztutwojner [00:07:48] Exactly. No, because we see that the nature of these organizations, the decision power is much more concentrated. So a frontline wouldn’t be able to introduce a technology like that and get the Buy-In. So the approach is different. Even if we started with a smaller, let’s say, business unit or location, we need to have the buy in from the beginning from the headquarter corporate. They need to approve it. So even the expansion of such a of such an account already involves from very early the approval from headquarters who said different way of growing within organizations.

Christina Bechhold Russ [00:08:23] And do you find that that differs between verticals as well? So that hospitality is is is maybe a slightly different strategy or adoption profile than manufacturing?

Daniel Sztutwojner [00:08:34] It does, actually, that’s a very good point, because hotels, usually the GMs, the general managers of each property, they have this decision power in most of the cases so they can decide for their own property. But when we look at manufacturing, even if they have different locations, it’s much more concentrated, the decision power. So we’ve seen some sense hospitalities, a bit more advanced on how they shared this type of decision power than manufacturing companies, which is much more concentrated.

Christina Bechhold Russ [00:09:03] And given that you to have different verticals that you’re going after within those verticals, how are you prioritizing which customers to go after when?

Daniel Sztutwojner [00:09:14] That’s a very good question. So, I mean, we we we identified already three main verticals that we go after. So that’s hospitality, retail and manufacturing. And we see that needs they have directly to align. And that actually mobile is being used already. So that’s how we started. We actually the proof concepts more than six years ago in these three verticals and expanding today, we have more than twenty six different industries working with us a lot.

Christina Bechhold Russ [00:09:43] And how important, given that you have so many different industries and you’re the chief customer officer, how important is feedback to you and how do you weigh, I guess, the validity of feedback that you’re getting from such a wide variety of customers to figure out what you should use to improve or change the product and what you shouldn’t?

Daniel Sztutwojner [00:10:03] And for us, the feedback is extremely important. I mean, how we continue developing our products, of course, incorporating the feedback from the customers and also thinking what is innovation so we can also define the market going forward. So we have constant feedback loops directly with we we work with product board so our customers can already look the feedback directly to our engineers and we can assess that. Also, we have a customer success team that is in constant dialog with our customers. And the way we prioritize is mainly there are two ways of communicating with organizations. And this was also defined by Gartner a couple of months ago. In their one of their latest reports, there is something called organizational communication. And then operational communication on an organizational communication is mainly relevant for the headquarter. So Headquarter wants to again align all their employees, share their mission, their values, their strategy, and then the each of the locations or business units. They want to have more of the operational communication. How can they work more efficiently? And we’re focusing a lot on the operational piece. So this actually doesn’t defer so much from a vertical to vertical because getting access to their shift are important policies, procedures, task and checklist that is relevant across different industries. And the way we can then verticals more is through a marketplace. So we also build a marketplace where then customers can add ons to make it even more specific to their needs.

Christina Bechhold Russ [00:11:34] And would you say the marketplaces are important in mobile SAS in the way they have been in desktop? Like a lot of sales forces, successes can be credited to the way they’ve built their their their marketplace of partners and the ability to add things on to customers.

Daniel Sztutwojner [00:11:48] I think it’s important to mobile SaaS in general. I don’t know if it’s specific, relevant for for front line or employee organizations, but definitely for for mobile SaaS. And I think it will depend more on the type of technology you’re building and what’s your strategy and your technology for us, that’s something we’ve been working for the past couple of years. Thankfully, we build the great relationships with the companies like AVP Workday ASAP to make sure that we can offer much more to to our customers than what we have in our core.

Christina Bechhold Russ [00:12:18] And you guys recently closed your series B, congratulations. So you’re officially accredited? Very much. I imagine that means there is a shift for you towards focusing on more enterprise level contracts as just as opposed to maybe the sort of small and medium business ones. How is that sort of change the way that you’re approaching these kind of big fish opportunities?

Daniel Sztutwojner [00:12:42] Yeah, I mean, as we develop our enterprise, focus forward and the entire company needs to adjust every function needs to adjust some marketing needs to address the needs of enterprise, the sales process differently. So our sales team needs to deal with different stakeholders from different departments. And we involved early on our tech team, our product team or the customer success team. So we kind of early on build a relationship with our customers and their Sunderer specific needs and make sure that we can walk them through the sales process very smoothly and efficiently. That’s very important to us. And to show them that we also understand what they need from from the beginning. So it requires an adjustment and for us is very important on these customer experience that we have a team early on focusing on these smaller enterprise accounts to be friends with me, that a small and medium market needs that in most of the cases that, say, 90, 95 percent of the cases, sales can handle that directly and it’s much more efficient. So there is an adjustment that we’re doing already for a couple of years on how to address enterprise efficiently.

Christina Bechhold Russ [00:13:46] And how are you guys thinking about Upsell? Because in the SAaS space, that’s a really critically sort of important part of the business model is, is expansion within existing accounts. And Opsahl, so are you guys thinking about that across users, across subsets of users or geographies? How do you guys think about that and for the front line workforce?

Daniel Sztutwojner [00:14:06] So there are two ways of of, um, upselling an account either is expanding in terms of number of users or adding more either locations, business units, or just adding more functionalities to their subscription. And so far, the first one is if we start only in the case of going back to my example, before Mandarin Oriental Citigroup, we started with two properties. It will be then adding the additional properties until we roll out to the entire organization. Some cases we have hotel groups or manufacturing companies. They just purchased Baykeeper for their entire and a number of employees. So that will be one. A very interesting case we had was for with Lafarge whole team. That’s the largest segment producer, cement producer in the world. And there we went through a merger and acquisition process and it was very helpful for them to have something like Baykeeper because they could very quickly roll it out to the new employees from the new organization that were merging with. And that actually was in in one week. They could connect with everyone and share with everyone their new mission, their new strategy with all the employees, especially when you go through such a complicated procedure, such a merger, you might have a lot of this engagement coming from the employees because of the uncertainty. They don’t know if their job will still be there after the merger is done. So that was another type of expansion because the company grew and we can grow with them. And when it comes to adding additional functionalities, that’s, for example, what I was mentioning before with a marketplace that they can actually either move to a better subscription, a higher subscription with more functionalities or just a take add ons from our marketplace. So these will be the two ways of upsetting and I can’t explain the new service or adding functionalities.

Christina Bechhold Russ [00:15:54] You guys are also a very distributed organization and the company is based in Zurich. Your Argentinean, you were you guys have a big office in Oakland, California. You have customers in Asia. Do you have any tips for people who may be, you know, building out these sort of distributed teams and, you know, how how best to to manage those?

Daniel Sztutwojner [00:16:16] I think I mean, today is very important to have that flexibility to be able to to bring them for me. I think the most mornings bring the best talent you can to to your organization and from the sales and marketing side. We like to be closer to our focus markets, so we will look for talent that is closer to them so we can serve them the best. Also, customer success when it comes to their product, what we call their product on value delivery engine. And within our company there, we really bring talent from whatever we can. So it’s really being flexible on finding the right talent. And there are so many technologies out there. I mean, we work with the Zoom. A Google allows us really to to have these three work for us and work like if we will be all together in the same office. So, I mean, my suggestion to find the best talent you can bring into the company, that’s the most important thing. Independent on our location. They are. That’s that’s key. Especially when we started early on as a startup. The most important asset we have is our team. Everyone makes the difference. So especially I mean, we’re right now 150 people, but we still feel and it’s still the case that everyone helps to make the company the success it is. So just focus on finding the right talent, whatever they are.

Christina Bechhold Russ [00:17:35] It’s good advice maybe with our last few minutes, if there’s any questions anybody has.

Daniel Sztutwojner [00:17:43] I to repeat the question otherwise.

Audience [00:17:47] You mentioned about having your team close by, especially with sales and marketing, but does that mean they still work remotely? And if they do, then how do you manage them to ensure that they’re doing everything that you want them to do?

Daniel Sztutwojner [00:17:59] So sales and marketing, they’d I mean, would work remotely, I guess. You mean outside of one of our offices? Yeah, that’s fine. And we have also sales and marketing, remote and customer success, and we look for the talent ideally closest to our focus market. So, for example, our office, Christina was mentioning this in Oakland, California. But we also serve, of course, the East Coast. So we have remote people in Atlanta and Boston, in New York, in Orlando to be close to our customers so we can serve them the best. How we manage them, I mean, it’s pretty standard for ourselves, will be pipeline reviews every week. We have each of the regions we call them swarms. It goes we’re called beekeeper. So each of our swarms, they have a weekly meetings to really define. Look at the KPIs from the previous weeks, what we have achieved, define the goals for that particular week. So that happens on a weekly cadence. Then they have five on review where their sales managers for marketing, they also have their own meetings, either weekly or monthly, to define the campaigns we’re working this through and work. As long as you define a very clear objectives and you have check points in between, you’re going to have a successful remote organization. But it’s very important to clearly define the objectives and have those checkpoints.