Jim Moffatt

Meet the Mind

Vol. 16 // 2021

Image Courtesy Jim Moffatt

Jim Moffatt is the Former Chairman/CEO at Deloitte Consulting

CT: Through your tenure at Deloitte, you worked closely with many organizations to execute digital transformations. What advice can you share with leaders on how to do this successfully?

Moffatt: I tend to think of things in terms of who, what and how. Understanding who is the customer and the stakeholder that I’m really trying to solve problems for. Then, what is it that I’m trying to create? What’s the experience that I’m really trying to get to and how do I go about implementing it.

When we looked at digital transformation, because of the comprehensiveness of it, companies tend to jump to the how before they really figure out the who and the what. Partly because it’s just more comfortable in terms of being easier, more tactical and more tangible. But if you don’t understand the who and the what, a lot of times you create things that lack the context of what you’re trying to transform.

Think about digital as it relates to all of the emerging technologies, what you can do is so broad and comprehensive, it has huge business and operating model implications. So, in my experience, these efforts need to be driven from the top. It has to be something that’s not just a siloed effort. Otherwise you will end up with a digital change, but it won’t be comprehensive and transformative.

It’s important to start by understanding the capabilities that can get unlocked through digital. So think of what mobile, cloud and social start to unlock in terms of data and other things. Really understand the potential. And then there’s a real creative element that comes into this. Essentially reimagining the future. Think about what the future of healthcare delivery or the future of retail can be in the context of these new tools. And then once you’ve done that, you can start designing and building house.

That’s what I have seen be most successful. Clearly identify the customer “the Who”, reimagine the future, and align with your team around “the What”. And then from there start to architect and design the solution “the How”.

CT: Some years ago, in an interview with the Washington Post, you said that there are too many consultants in the world. What did you mean by this?

Moffatt: It starts with the context that, over my career, we were working with really smart clients , working for really great companies. They all went to the same schools we did and they’d been deep in the industry for a long time. They were great at what they did and what they really needed consultants for is when they came across something, for example digital transformation, that they hadn’t done before. They needed to bring in people that had the kind of expertise they lacked. So the context of that question was really predicated around the fact that consultants can provide tremendous value if they’re applied around the right thing, for the right duration. I think the real challenge for companies is understanding when and how to use consultants.

In addition to delivering a high-quality project, a good consultant should do two things. One, they should be honest with the client about situations where they’re not the right firm or the right people to solve it. Consultants, they can do most anything and they’re smart enough generally to figure it out, but there are things that either they don’t have the right resources or the experience for, and they should tell you. Anytime I had that conversation with a client, they were always very appreciative of the transparency and the overall relationship was actually enhanced.

Two, they also need to know when to disengage. There’s a point in every large program when organizations have to start to stand up their own supporting organization and oftentimes they’ll take too long on that transition. With one client we went so far as to start recruiting people to fill roles because they weren’t moving fast enough, and they needed to take control. The problem is, if you don’t do that as consultants, at some point, the CFO looks at how much you’re spending, and that the program budgets have been exceeded, and in my experience that never ends well.

So make sure you’re focused on the right thing and that there’s an off ramp to disengage and the company starts to build their own capability to maintain the operations going forward.

CT: There’s been a lot of talk about a “tech decoupling” between the US and China. Do you think this is likely? And what would the implications of such a decoupling be?

Moffatt: Well, talk about a complicated issue. Headline, there will be some degree of tech decoupling. When you look underneath how tightly entwined the economies are, complete decoupling is really complicated and hard to imagine, but if you take the Venn diagram of overlap between China and the US, I do think it’s going to start to separate and the intersections will be smaller.

If you just focus on tech, I think you’ve seen a lot of the decoupling, particularly around some of the social apps and around cybersecurity and there will be a natural push to have a greater degree of privacy and independence, or a kind of mutual independence. But I don’t think you can completely separate, the markets are too big on both sides. They are the two biggest markets in the world. So you’re going to have large multinationals and tech companies wanting to sell into that space. There’s still technology in China in which they don’t have the same degree of capability as they do in the US or other markets. So while you will see some decoupling, I think it will be targeted around specific aspects of technology.

All that said, as it relates to technology, I could see a world where you start to have a China version and a non-China version. And there’s going to be a need to navigate both to some degree. When you broaden the question to include supply chains, manufacturing and consumer markets, it’s hundreds of billions of dollars that are intertwined and the amount of value to companies outside of China is too large to merit complete decoupling.

CT: You’ve had unprecedented access to global business leaders and international markets. Given this experience, what are some high growth global markets and verticals that you feel aren’t presently getting the attention they deserve?

Moffatt: I don’t know if they’re not getting the attention that they deserve. I think the world’s global, and I think customers and markets will drive us to continue to be global. There may be more complexity with social conditions and some security threats, but I think the trend towards globalization will continue. I’m a big proponent of the opportunity in Asia-Pac. As I started to think about where the world’s largest economies were evolving, and what was going to happen in terms of growth and investment, there was a large shift towards Asia Pacific. I know we started to spend a ton of time, not just in China and India, but across that whole region, including Japan, Southeast Asia and Australia.

My personal view, Eastern Europe and Africa are important markets, but both are longer-term in opportunities. In Asia Pacific, there are huge populations, tremendous growth, and lots of near-term opportunities. I know we started allocating more resources and capital, and I would continue to pivot into that direction.

In terms of verticals, I think what’s interesting is the emergence of all the exponential technologies and the opportunities they unlock in virtually every vertical. I tend to think certain verticals have greater potential, whether it’s consumer products or life sciences, but there’s just a huge transformation opportunity across all verticals. It’s hard to find a vertical that isn’t in the middle of some degree of disruption and transformation.

We also started to look at places where ecosystems starting to come together. So you start to talk about topics like the future of mobility and the future of cities, with the emergence of connected devices and IoT, and the potential enabled by 5G coming on board. Another interesting trend is the shift in focus and investment from the back office to the front office. In the last few years, investment dollars have pivoted towards the customer side of the equation from the back office, and I expect that trend to continue. Starting to unlock the capabilities that allow people to stay connected to their customer across all channels and provide value to their customers in very, very unique ways that just wasn’t possible five or 10 years ago.

CT: We’ve been through the business process re-engineering wave, and there’s now a “robotic process automation” wave sweeping through companies. What do you think comes next, and does AI play a role?

Moffatt: I’ll start with the end. I think AI and data are foundational to everything that’s going on. In my previous role we pivoted, not all, but a large portion of our investment dollars into looking at what could be unlocked through AI and data. All the clients I’m working with today, I won’t say it’s table stakes at this point, but I think they’re all racing to understand how AI can be leveraged to support and differentiate their business. They’re looking to build or leverage an AI engine to bring some degree of intelligence to their processes broadly. I think it’s an exciting area. I think it’s an area that will really start to emerge even more so. And in many ways it’s going to be a race to the algorithms and the data, and who’s got the best. I can think of one healthcare client in particular that we worked with that was doing some really interesting work around genomics. It became clear early on, that the company that got the data and developed the AI engine and algorithms first, would be the eventual winner in the marketplace.

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