Schneider Electric is more than 180 years old, and we have pivoted several times. We started in iron and steel, and now we are providing energy and automation digital solutions for efficiency and sustainability.
As you can imagine, we have learned many lessons along the way for making successful pivots. Since I just had the opportunity to participate in a global podcast conversation with Accenture’s chief executive of Accenture’s Communications, Media and Technology operating group, Omar Abbosh, and will.i.am, musician, philanthropist, and technology investor, I would like to share a deeper look about what it means to make a wise pivot for the sake of efficiency and sustainability, drawing on Schneider’s four lessons learned.
# 1: Keep your eye on a clear, consistent mission
You should know where you want to go well before you embark on the journey. At Schneider Electric, sustainability is at the heart of everything we do. We made the choice of efficiency 15 years ago. Our mission is clear and consistent: empower all to do more while using less resources, ensuring Life is On, everywhere, for everyone, at every moment.
With this North star, we regard fighting climate change brought on by carbon emissions as our corporate duty. When it comes to this call to action, I am neither a pessimist nor an optimist: I am an activist. This daily action is building the path to reach our commitment to go carbon neutral by 2030.
The huge opportunity before us is electrification across the world, which will double by 2040. At the same time, BNEF anticipates 2/3 of power capacity will come from renewables. This evolution between centralised and decentralised energy systems and the convergence of energy and digitisation open opportunities towards real efficiency and sustainability. In the past year, thanks to IoT technology and electrification, buildings are becoming smarter, industries less energy intensive, cities and data centres more efficient. With leaders and empowered employees and partners, let’s keep moving forward to enable life, progress, and sustainability for all.
#2: Innovation and tech are key
There are two kinds of pivots at work here: the pivots you initiate, which are good for the company, and the pivots you have to face and support as constraints. Those are painful, and you do not want to experience them. Anticipate them and innovate to lead the wave forward.
We are thus inventing and delivering technologies for a more sustainable world, working to make energy cheaper and greener, while also making process more efficient, both with the goal of reducing the impact of human activity on natural resources. Lessening energy and raw material consumption is imperative for all of us, in buildings to industry, from cities to data centres.
We have committed 5% of annual revenue to R&D, and, today, 45% of our revenue comes from connected products, solutions, and services. To accelerate this commitment to digital, we co-innovate with partners and customers where, together, we can accelerate efficiency and sustainability. By working with customers such as Hilton and Whirlpool, for example, we are creating a more sustainable future.
#3: A good pivot is one built on your knowledge, history, and strength, allowing for anticipation first and then adaptation
Accenture calls this turning point a wise pivot. This is a perfect analogy, as you need one foot on one side, the old, and one foot on the other, the new, to make a successful pivot.
As the world is becoming multi-local, at the same time more global and more fragmented, openness and collaboration are the sources of this agility. Plus, there are incredible advantages in having technologies that connect so many people across geographies, empowering transformative ideas for today and tomorrow. Adaptation also comes with proximity: that’s the reason behind establishing and nurturing multi-hubs. And it’s also the reason our global yet local approach has allowed us to build the most extensive network of partners in the world.
Partnerships bring to life this agility and adaptation, both so critical for succeeding in our fast-moving digital economy. The world needs a collective will to make a difference. The big picture is clear: no one person, or a single company, can transform alone. Digital transformation takes an extended enterprise.
That is exactly what we are doing with our open digital ecosystem and business platform, Schneider Electric Exchange. For instance, tech companies can develop connected analytics and services, providing SaaS applications that allows machines to talk and improve factory production performance. Through connecting to the ecosystem of Exchange, one of those developers was able to tackle Hellenic Dairies’ plant activities including connected cleaning-in-place cycles, in order to optimise their duration and reduce water consumption by 20%.
#4: People are the greatest asset for advancing any company’s digital transformation
Our people and partners are the drivers, with their innovation, digital talent, and ability to spark the power of communities working together for change. That is why we are committed to unleashing the infinite possibilities of an open, global, innovative community that is passionate about our meaningful purpose, as well as our inclusive values and push toward empowerment.
And as the change is deep, you need to support the people to make the best of those new tech. For instance, when you are in digital, you can start training your operators in virtual reality on a digital model, including on the most complicated situations before they go on an oil platform, an oil rig, a ship or building. With augmented reality at hand, operators can be fully trained in a digital format before they start really working. Improved safety is another win here.
People are at the heart of digital transformation. In fact, the future of the digital economy, and its promises of greater efficiency and sustainability, is in the hands of collaborative communities. We invite you to take advantage of our four lessons learned and to leverage the Schneider Electric Exchange community to make your own wise pivot toward digital transformation.
- You should know where you want to go well before you embark on the journey.
- There are two kinds of pivots at work here: the pivots you initiate, which are good for the company, and the pivots you have to face and support as constraints.
- You need one foot on one side, the old, and one foot on the other side, the new, to make a successful pivot.
- People and partners are the drivers, with their innovation, digital talent, and ability to spark the power of communities working together for change.
Jean-Pascal Tricoire is Chairman and CEO at Schneider Electric.