Speaker 1: Hey there, product lovers. Welcome to the Product Love podcast, hosted by Eric Boduch, co- founder and chief evangelist of Pendo and super fan of all things product. Product Love is the place for real insights into the world of crafting products as Eric interviews founders, product leaders, venture capitalists, authors and more, so let's dive in now with today's Product Love podcast.

Eric Boduch: Welcome lovers of product, I am back with part two with Anneliese from HP. Anneliese, let's start today by talking about COVID because we're in the midst of a pandemic, hopefully at the tail end now, but COVID's obviously significantly impacted the business landscape and in particular, the small business landscape. Talk to me about how that's changed things, how business owners are now adopting new technologies and skills to keep up and what that means too from a security standpoint, because that's become a big issue as more and more people are remote.

Anneliese Olson: Yeah, absolutely. It's amazing that we've kind of lived one of the biggest case studies real time in terms of what's been going on, especially for product leaders, as we think about the four P's and what does it mean for forecasting and pricing and all of that, but ultimately really anchoring on customers. And these insights that we've gathered during this time is what has I think fed us most importantly and hopefully that's where a lot of people have spent their time. I think the fact of kind of, we talked about one life and the fact that as we look at customers and what they do on a day to day basis, everybody now has technology often integrated in something they do, whether they're in an office or whether they're at home or whether they're in different mobile locations or whatever. And this one life has kind of come to a head of, it used to be, I would say a bit more PC- centric and a bit more here's the tasks that you do when you're say working at home and here's the things that you do when you're in an office or in a factory or something like that. But now it's this evolution of hybrid that has to kind of coexist all the time. One life for what it means to me, what it means to you, what it maybe means to an engineer that all has different meanings and how we look at it for HP then is how do we enable the outcomes that customers, what do they need to do? And what do they need to do now in this new hybrid ecosystem? And so COVID has accelerated digital for sure, in so many fronts, whether it's in the way that people's their meetings, their interactions, their collaboration, their workflow has happened. We've seen emergence of a number of mobile and app based kinds of solutions, whether it's in the compute space or for us specifically in print, we've seen a 125% growth in mobile pages being scanned, for example. Some of the scanning apps that are on people's phones, we have one of the biggest ones, about 50 million active monthly users for something called HP Smart. And because we get all that data, we have seen what's happened as people are digitizing some of their own workflows or where people need to have the capabilities to be able to scan and send documents or they need to access documents from different kinds of places. And so what does that mean for storage? And then to your last point, which I think is one of the biggest ones and this is across industries, is what does hybrid work mean for security? When we talk a lot about security in the past, I think people think about physical security and then maybe hacker protection security of say a device, but really for a while, we've been very focused at HP on it's the security of the data, it's the security of the device and it's the security of the identity, of the person of the user. And with COVID, it's kind of turned it on its side. You talk to CTOs or small business owners, they're like, look, I have people now working in these different locations. I want to be able to remotely manage and monitor what people are doing. And I don't mean the spying security. I'm not talking about that. Just the workflow of where things are getting stuck, how a document is protected and privacy and who's allowed to print it or not. Or, hi, I'm a CTO or a business owner and I've got people who we've outfitted with computers and printers and things to do their jobs, but we want to be able to charge the costs, the job accounting to our clients. And some of that printing for example, is a really important piece in the legal industry or the real estate industry or whatever. How can they do job accounting? And security's a part of that and the connectivity that's there and the protection on if somebody's on a home network or someone is at a work network. And so there's a number of tools that we've continued to invest or quite frankly, accelerate around this security need and we're doing it real time in many cases because we'll do those round tables with the business owners themselves and take that feedback directly to the engineering and software teams and say," Okay, how can we get this kind of stuff on the roadmap and evolve that over time?" And that's a new muscle as we work on some of the pivot with more services and software solutions as well.

Eric Boduch: Tell me some of the data. I'm a big data guy so I love to hear it. I love to hear that scanning app and how much mobile scanning has changed. What other things have you seen change from pre- COVID to post- COVID as far as are we printing more pages at home? I would guess yes, right?

Anneliese Olson: Yes, of course. Yeah. We've got over a 100 million devices out there as an install base that have that data with customers approval of privacy, of course, so that we can see those trends and what's happening. There's data from the computers, from the printers and from the app itself and also from services like Instant Ink. Instant Ink is the printer is smart enough to know based on you, Eric, here's the days that you print or here's what you do and here's what we anticipate because here's the amount of pages you're doing and then send you the cartridge when it's time so that you don't have to deal with it, takes out the hassle, those kinds of things. And we can see yes, home printing and we saw it in the United States when country lockdown started. We saw it in different European countries when the lockdowns started, literally day by day, week by week. We could use that information in terms of what we did upstream for how we plan manufacturing and forecast because if in homes there's more inkjet printers, at work, there's more laser printers. And so we had to use a lot of that data when we were looking at usage and yes, no question, people are printing more in the home during COVID than they were in the past. I think as we also have done lots of surveys and pieces of even by day, there's some how are people looking at what they do on a weekend or on a school? Some school patterns in certain states, when they went from all digital back to some hybrid and which kinds of things were happening, when schools put in the capability with Google Docs or teachers were actually using some of those kinds of ecosystems, you could see where print was happening in a lot of the retention based pieces and documents over two pages where it was different for say the permission slip form that someone would scan and upload, for example, faster and not have to print.

Eric Boduch: You mentioned something interesting too about time. I imagine you can, in some ways, see the hours people are working based upon their history with devices at an aggregate level. Are we seeing what we hear a lot about is that work life has completely blurred, that people are working all kinds of crazy hours now because of COVID?

Anneliese Olson: Yeah. I think it differs around the world. All the studies we've done externally and then some of the view that we've learned as a company is productivity is definitely up because people are working more. Especially if you look at the segments of knowledge workers and things like that, where people are kind of always connected and you kind of saw the surge of what happened over time. I think when COVID started and lockdowns went into place, productivity kind of went through the roof because I think a lot of folks were thinking, okay, I'm going to do this for a while and then we go back to the office. I think there's great things from that but then you started to see employee challenges in different companies where they needed relief. You've seen now many companies kind of figured out, oh, Adobe takes every fourth Friday off or we have things at HP of no meetings Fridays, depending on the different teams and workflows.

Eric Boduch: A lot of tech companies doing mental health days.

Anneliese Olson: Yeah, because it's insane. And we know from research about kids and things too is more and more screen time is not necessarily good. How do you deal with the Zoom fatigue and the rest of it? And sometimes it's interesting, that's where sometimes print plays a role because people can get off screens and do some other things and come back. But the data that's continued to really emerge and some of this acceleration you mentioned on digital, the other thing is productivity of how complex is something to do? Especially if in the old model it was a whole physical process or it took 17 steps to do something, automation now is helping or at least digital is helping in some cases where new tools we've been focused on just to reduce the number of steps it takes to do something. Some of the new products that we've introduced, we built kind of all the software in such a way so that there's easy web apps built into the devices themselves sometimes with a front panel. If somebody has a document or a contract or something like that, that they've had to review, they can just go straight scan the cloud and all the apps and the hook ins are built in so that you don't have to scan it, deal with your PC or a USB drive or whatever, figure out what folder it needs to go to and whatever. That's where we've also been focused on productivity with some of the new offerings, because they can even customize them themselves inside the app to say," Okay, I'll do this task. I want it to go here, here and here." And then every time they can do the app was one button that activity happens. Being more productive isn't always implied when we say digital, because it also has to do with the ecosystem around it, at the company or whatever too.

Eric Boduch: On the remote work model, what do you think is going to happen in the future? Are we going to go back to an office culture? Is there going to be a hybrid work model? Is it going to be partially remote? Are companies going to split? What do you see happening? And how's that going to affect your business? Because you just mentioned, as a case in point, people use ink jet mostly at home, laser at work, I'm sure that creates supply chain problems if all of a sudden there's a huge shift from one type to another.

Anneliese Olson: Exactly. Yeah. Well, I would say, especially as product leaders, our muscle flex for scenario planning has been the utmost testing this year for those exact reasons, because how you look at your near term, midterm, longterm planning and where you anchor your assumptions is really important. For us across and we work across HP on this, not just in print, but across our services business and across computing as well, is very much hybrid. And it does look different by country. And it does, company culture obviously has an influence on how modern someone is thinking about, can hybrid work for them or not. Obviously what's been accelerated here this year is there were companies who said," There's no way anyone could ever work at home." Well, that's been disproven in many ways. But it also, in many cases, because of that employee engagement with their company, with their colleagues, or how do you collaborate? One of the first things we figured out with engineers so any company that builds anything or sells anything or puts anything together, that collaboration face to face is sometimes required. That's why we think hybrid is really the space where people will be coming into offices depending on their job type. If you're an engineer and you're making physical goods or sometimes even software things, you may need space to tinker with devices, to pull out boards and firmware interactions and testing. If you're doing quality testing, if you're doing any mechanical or electronic kind of work, if you need to test a 3D manufacturing line, you have to do that stuff face to face. And so we look at it more as the segmentation and personas of it's a blended view because you've got different functions that need to come in and work together. You've also got employee engagement that maybe you may have call center folks at home but you may have people all in the city of Chicago or in Dublin who want to come together and have a monthly town hall or a social event or an interaction with a customer you come in then and have workspace for that. The configuration of the workspace, I think, is going to change a lot, not dedicated tethered one to one desks for employees, but hot desking and collaboration space that can be easily monitored and booked and checked out. And then for our business, what that means is if we're going to design for that hybrid environment and we're going to design experiences for these different customers' segments, for these personas of the kind of work they do, then that'll change the way we look at our device optimization and the services we offer for customers and also just the process automation and workflow, what can be enabled. In the compute space can you imagine what will happen? Some people will be in an office and some people may be at home or in a different country. How do you enable the best virtual collaboration when there's physical and digital to be efficient and to have employees be engaged? For printing, we may not need as many huge devices as maybe copier central locations and stuff at the same time versus you need access to something because you've got collaboration workspaces across some different locations so you might need smaller footprint printers, but with all the capabilities that you can still scan and file and route documents as part of a process. It is anchored, I think very much on thinking about the customer experience. In the hybrid world, how do we keep them secure? How do we keep them sustainable in doing that? And the flexibility to move around so you'll have more of a personalized experience as an end user, whether you walk into a WeWork type set coworking space, whether you're at your own corporate office and therefore you'd have more access, more behind the firewall, versus if you're at home and that persona that's tied to you, if you need to access online or get physical output.

Eric Boduch: You talked about digital and digital transformation in some of your answers to the last few questions, let's talk a little bit more specifically about that. Who owns digital transformation at different companies? Especially the larger companies. Is IT driven? Is it product driven? Where do you see these things being driven?

Anneliese Olson: That's a great question. I think a lot of people are in a different spot in that journey. I'm a huge believer that everybody has to own transformation in a company. If we don't all get to a level where we understand the basic concepts, let's say of digital transformation, what are the building blocks around security, around data access, around what tools like machine learning and AI can provide us. And that's both in conducting business, but also in the products and solutions we offer our customers. Everything will be in the cloud. Everything will be a service. If we know that that's directionally where the world is headed, how do we then design the transformation to do that? Agile comes up a lot. I did not come from an engineering background, but had an opportunity for a couple years to run our software and solutions for print with a few thousand engineers and I had to learn a lot about agile and what does that mean? What does it mean to have a foundation or a platform where then you have these sprints and short opportunities to add features to evolve? What are the connective tissue and how quickly you can roll things out and at what pace and try and learn and maybe fail and make changes. And what we've taken that learning I think from the maybe software world and applied it now, like many companies are starting to across the transformation, is how can you get into things like enterprise business planning? And what does that mean then for product portfolio planning? What does it mean for engineering? What does it mean for analytics? Not just running our business now, but predicting that in the couple of quarters to come. How do you use that prediction to drive supply chain? And optimizing where the things you can automate, because today people have lots of analysts and bodies and functions across that. What can you automate? But then what else is it that can kind of drive a step function towards that future state? Because as you think about moving ahead to subscriptions and these other things it's different.

Eric Boduch: Talk to me more about the transformation principles, because I think it's even in your bio that you write you're an early adopter of tech and transformation principles for the enterprise. Talk to me about that experience of transforming enterprises, where they struggle, what they're doing well and who inevitably, just that you say everyone needs to be involved in the process, but who's the one that is kind of who's on the line, so to speak.

Anneliese Olson: Who's on the line.

Eric Boduch: Who's the chairman or the CEO coming and saying," You're the driving force behind our digital transformation at XYZ Fortune 1000 company."

Anneliese Olson: Right, right. I'll start with that answer first. Most companies who are taking this seriously have a person, a neck to choke as a transformation officer. Almost everyone that I see doing it well, we have one at HP also, is there does have to be some connective tissue of who owns the plan because it does touch everyone's job. Whether you're in the business, the functions or whatever, has to be supported by the CEO. A CEO has to have transformation or being comfortable with the uncomfortable approach in terms of setting an agenda. And then some of the principles part, we've been on this journey for a couple of years so I can share some of my observations. IT has a key and critical role, particularly for companies that did not start out digital first. We've been around 80 years, it's a very different process when you had countries around the world where you had to start collecting data. You're talking about product shipments and sell through and pricing. And there's so much connective tissue that has to happen behind the scenes. And you can imagine over the years, people have SAP, people have different tools. People are using Salesforce and CRM. Tools in the Salesforce, how do you get that all together so that you do have a foundation of enterprise, an enterprise business planning set of tools? We're working with SAP and S/ 4 in a big project called Simplify. For us that IT agenda tied to enterprise business planning was one of the first kind of fundamental pieces is, where's all the data? Where are the data lakes? Who are the subject matter experts? And how do we get that sorted? And that continues today. It's not overnight, especially for a large company. I think another foundation principle that we did work with some consultants on externally is this idea of zero based budgeting is fundamental I think in thinking about transformation. It's very easy for groups to say," Here's my budget this year," or," Here's how many shipments I have this year," or," Here's my strategy and therefore it's this much growth year on year," or," I need this many resources year on year," things like that. If you really want to drive transformation particularly now, shifting to as a service, subscriptions, things that are disruptive in your own business, you have to do zero based budgeting, which is if you stopped everything today, the first question is, what do you need to keep the lights on? That's the real practical conversation of what is required to do the lights on. Then the next thing you put in the stack is nothing about run rate. It's what are your top strategies, one through 20 or whatever projects that need to be funded? And you fill that funnel first with the strategic things. Then let's say the cutline is there, where your budget is or the initiatives, it's the rest of that that typically ends up being huge, shorter term transformation opportunities, either in efficiencies, in trade offs and choice points. Because even in how you look at budgeting, that's not what people naturally do because everyone always builds on year on year growth rates and things like that. That's a principle.

Eric Boduch: You're really just talking about instead of being incremental changes to the budget, you're talking about radically redefining how you're allocating assets within the company.

Anneliese Olson: Correct. On the one hand, some people say," Oh, maybe that sounds simple." A lot of companies don't always do it that way. I do think startups and small businesses tend to be a bit better at that because their livelihood may be very clear in terms of what they're doing and they may be part of what's disrupting industries.

Eric Boduch: No, it's a lot easier to do incremental. If you knew you shipped out 2, 000 printers last year and this year you're going to ship 3, 000 printers, well, you have an idea of what you need for a shipping budget to ship the extra 1, 000 printers. But if you're redefining that and saying," Hey, we're now going to do prints from the cloud and you're going to pick up paper," it just changes everything about your fundamental assumptions. You can't build things incrementally.

Anneliese Olson: Right. And a lot of times too, we've used this framework the last couple years that's helped is, you kind of have three waves, when you think about strategy and budgets and stuff, as well as in your core business, you shouldn't have more than 65, 70% of your budget having anything to do with your core. A lot of times companies have 90% or 95% of their budget in core. And if you are really trying to transform to invest for us, it's microfluidics and 3D printing. And as a service, you've got to put your money behind those things or they'll never get off the block. Now, different companies do different things like keep some of it as LLCs or how do you keep it walled off so it's protected and doesn't get into the vortex if somebody's dealing with cost cutting? Zero based budgeting is another one. Applying agile, as I said, across work streams and how quickly you can pivot to some of the new metrics, no matter how small the business is. If being in a subscription, for example, those metrics on subscriptions, businesses are very different than subscriptions of how many printers do you ship per year? Or how much market share do you have? We've had to really work to both in terms of benchmarking externally, what it means in different businesses. The more we had to learn about subscriptions and go look over the last couple years with Netflix and just different models of trying to understand scope, scale, pricing, monthly active users, churn rate and that's different in transformation for people who run other big businesses even in COVID, which are growing or have done very well. But it's still not the same as what's transformative to what's next, if that's helpful.

Eric Boduch: And now, we saw obviously digital transformation was already an important topic for most, if not all large companies, but now because of COVID and this push, the impact it's had on remote and a digital world, that's got to have just accelerated pretty much everyone's movement to being more cloud based, being more digital. How have you seen that impact clients of HP?

Anneliese Olson: Our estimates I think Bill Gates gave some numbers as well, but we talk about things accelerated probably five years in terms of the needs for security, the needs for more workflow and digital tool sets for people and how to figure out processes real time. I think the piece around digital for how people do business, I think, and I guess maybe from the product portfolio lens has to be looked across the entire customer lifecycle as well. Yes, it's talking to customers and getting input about what it is that they need to do. What does hybrid mean to them? I mentioned the experiences earlier. If we assume hybrid is here to stay, then how do those personas evolve in terms of what we have to enable? But also what are all the touch points that you interact with your customers now in the hybrid world as well? Because a lot of times people think about innovation only in products. Hardware or software, but there's a lot of innovation around customer service and support now, where look how much chat has grown and what if people are able to learn all of that data and have one customer ID so that if you call in for service and support, you don't have to start over every time because they already know, hey, you called in last year and you had a question about your Windows upgrade. Or I see that you have this product and you've had it for 30 days so we don't have to spend any more time talking about how we solve your problem, because we know the next step already. Customer touch points. It's also in go to market. And to serve customers, we've got to be more digital first in the way that we think about things, not just for chat and things like that. But how do you demo products? Virtual demos, how do you have the same kind of experience that's not just watching a video, but something more interactive?

Eric Boduch: Yeah, it's easy doing a virtual demo and it's software, but when you're trying to show a bicycle or what have you, demos become a lot more difficult.

Anneliese Olson: Yeah. We've learned a lot, I think, from software demos, but it is exactly that. How do you have virtual presentations that don't just feel like Zoom calls? Oh, I know people who are getting really crafty on, you see things on LinkedIn and other places, but virtual events that are very well done. And how do customers interact and feel like they get a personal touch or a personalized experience from someone or a brand but are living sometimes in a physical world and sometimes digitally? How is it consistent across omnichannel? People when they're online, oh, but they actually do go to the Best Buy and want to touch it or feel it or look at what's on a device or some other kind of product. Or a huge growth that's happened now in the US and Europe is order online and pickup in store. You can see inventory management and how well it's being done because you can see your zip code. Do they have any inventory near you or not? Well, if Best Buy or Staples or people like that are using their data in the right way, they can also optimize.

Eric Boduch: There's got to be a whole business around people picking up stuff that you've ordered now and is available curbside that's going take off, like little Uber pickup service.

Anneliese Olson: Exactly. All your food delivery. Being more digital and understanding all the touch points of serving customers it can't just be a specialized group of people or part of the strategy team. Again, it has to be infused in kind of everyone's job.

Eric Boduch: You've talked about kind of this, as things are moving hybrid, there's a lot more done at home. There's more printing done at home. There's going to be, taking just the HP print category, there's going to be more printers I imagine in people's homes now, moving forward and less at the office, if we're moving to this hybrid model. Which raises this question of sustainability too, especially for small and medium size businesses. How you guys guide people on sustainability, on managing costs and energy consumption? How has that affected HP's thinking?

Anneliese Olson: Yeah. This is a really important area. And it's growing in importance. We saw, I think Google had the data during the first three months of COVID, sustainability grew over a 1, 000% as a search term in general, in many, many categories. How can I be more sustainable? Because then everyone's getting their Amazon packages at home or what do I do with all of this? And so it's a really important question. We've had sustainability initiatives for over 30 years inside of our agenda and corporate focus, so this isn't new. Bill and Dave, this was kind of fundamental of, we need to take care of shareholders, customers and employees as part of this and sustainability then became for us, it's how can we help planet and people and communities? And now knowing that people have shifted to say that right now, I think our statistics shows 87% of people who are buying printers care about sustainability in their decision. People are thinking about it, it's front and center and that's been kind of where we're focused. Now, all the supply chain pieces, we up cycle a million plastic bottles a day just in our ink cartridges, for example. And so they're over 95% recycled plastic. We've got plastic, paper, all of those kinds of goals and initiatives, but where we've pivoted to even more so is helping people make sure that we have solutions that are carbon neutral and that are forest positive. And forest positive is really about how we work with the paper vendors, we work with our solutions and we work with other third parties so that all of the practices on reforestation efforts and everything else is actually replenishing more than is being used. We brought some solutions lately to the market on a solution called HP Plus. And what forest positive does that's actually tied to the end user is we have customers opt in and when they opt in as part of HP Plus during their printer setup, we have a cloud enabled ecosystem. I talked about with Instant Ink and those products where a customer's print volume determines the amount we fund the restoration projects and the investment needed all based on science based targets as part of that. And then we are investing that same amount to cover all of the pages that go through our printers and more. And so forest first, forest positive is what we're focused on. There's zero deforestation when you print with HP Plus. The carbon neutral part is a big deal for many of our customers and so we launched the first carbon neutral services last August in the industry, so that all the managed print services, we have the digital tools that go with the customers to assess their environment, to look at what are being used, not used, how can they optimize their fleet and that way that they can engage and purchase those services basically so that they can be carbon neutral. And a lot of folks are looking at their own way that they serve their customers because they want to be in that space of being more sustainable in the way that they conduct business. If they want to green their own businesses from the grounds up, their equipment choices are really important. We've grown HP this year, there were over$ 2 billion in sales that were based on choices around sustainability and that's growing in big amounts year on year. And so we take this really serious, whether it's ocean bound plastic or the supply chains themselves, reducing water, being carbon neutral by 2040 and putting all the pieces in place. And we're going to have to keep pushing to lead here, both with government engagements, engagements with folks like World Wildlife Fund and others. And it's not just doing our part, we need to do more than that, quite frankly.

Eric Boduch: Yeah. Wow. There's lots of great discussion again today and we're already at the end of a second episode. As we're wrapping this up, I have one final question for you personally. You've obviously seen a lot, you've done a lot, I'm kind of curious what are three words to describe yourself?

Anneliese Olson: Oh, goodness sakes. That's right. I forgot you were going to ask me that. One word is transparent. What you see is what you get. Passionate and fun. Those are the three big ones for me. The transparency, when I think is it's kind of how we live and breathe every day. It's my one life in terms of who I am at work, who I am in my life is the same person and being able to kind of have that front and center that way it's a lot easier to engage.

Eric Boduch: I think it's a great word. It's one of our core values at Pendo, transparency. And it has an amazing impact on a company, having transparency as a core value and I can see that being good as a human being too.

Anneliese Olson: Yeah, I think so. It's just much easier in the way that we conduct business, in the way that we have our relationships with the people and the world around us and it's also easier. It's easier. You don't have to have multiple agendas or personas. It's just easier.

Eric Boduch: No, absolutely.

Anneliese Olson: The hard drive in my head is full all the time so there's only one version of me that I can be and transparent is just easier.

Eric Boduch: Well, thank you. I appreciate your time again today. Thanks Anneliese.

Anneliese Olson: Yep. Thanks so much, Eric. Have a great rest of your day.