5 mins read . 15 Jun 2023
Louis Gerstner, the legendary CEO of IBM between 1993 and 2002 led the iconic company through one of its most difficult times. At that point, IBM was like a technology elephant. It was huge, successful, intelligent and cash rich. It is just that it had failed to adapt and change with the times. Under Gerstner, IBM implemented a massive turnaround strategy to become competitive and capable of surviving and thriving in the long run. It may not have won the market cap race, but it surely created a business model that is still amazingly profitable. “Who Says Elephants cannot dance” was the book written by Louis Gerstner on the turnaround of IBM. But, why are we discussing this today.
It is said that it is easy to change when you are pushed to the wall. That is because you do not have a choice. Tougher still, is the ability to change when the going is good. At that point, change is not about the absence of options. It is about a strategic move to visualize and prepare for future challenges. That is exactly what Hindustan Unilever is doing in India today. India’s largest pure FMCG company, Hindustan Unilever, is not waiting for change to happen. Instead, it is trying to sense change and prepare customers for it with the use of emerging technologies like Artificial Intelligence (AI). It is using AI to sense demand shifts and rapidly prototype.
During the pandemic, the demand for acne products peaked, as per search engine output. A quick analysis of the problem revealed to Hindustan Unilever that the problem was not generic acne but the different stages of acne. Existing remedies focused on generic acne, which was the opportunity that Hindustan Unilever saw. In response, Hindustan Unilever did not build a single product but a range of products to cater to different stages of acne. But the biggest factor was that they managed to put together the “Acne Squad” brand in less than 180 days including trials and regressions. That was largely thanks to the intensive use of artificial intelligence for demand sensing.
Demand sensing is just one part of the story. Of course, the use of big data allowed them to arrive at actionable conclusions from the internal sales data, external market data and search engine intelligence. However, the real challenge was time-crunching the product. Normally, a product like the “Acne Squad” would be possible only in about 18-20 months. In this case, with the use of AI at the Agile Innovation Hub, Hindustan Unilever was able to crunch the time to launch to just 180 days. So, the use of AI has played a big role in focusing the R&D efforts as well as substantially crunching the time to market by more than 70%. The message is that if companies can increasingly leverage such internal and external data, product cycles can be crunched substantially.
What the case of Hindustan Unilever underlines is that it is possible to use big data to add value across industries. In this case, HUL has done rapid data evaluation and prototyping using AI, with substantial positive rub-offs for the business. There are three important messages that come out of this story. Firstly, Indian companies can and must use the power of data to sense demand and to rethink products and product positioning. Secondly, change has less to do with size and more to with intent. If the intent to change is strong then change can happen. Lastly, change is toughest when the going is good. But, that is also the right time for change!
Content Source: Live Mint