Breaking the traditional business model with technology
February 11, 2020
Sponsored Content

This post is sponsored by Philip Morris International.

Michael VoegeleCan an organization completely transform from one of the most traditional, unchanged manufacturing businesses in the world to one of the most technologically advanced?

In this interview, Michael Voegele, Philip Morris International’s Chief Technology Officer, shares his insights into the company’s transition to a smoke-free future and explains how PMI is leveraging technology and digital pathways to deliver consumer-centric solutions that can help accelerate the transformation of a company and an industry for the better.

You moved from a sports and technology company, Adidas, to PMI. What convinced you to make the jump?

It's a fair question. Here's why: PMI today is a very different company to the one that's probably top of mind when you think about the tobacco industry of the past. The PMI of today is squarely focused on replacing cigarettes as quickly as possible with scientifically substantiated smoke-free products that are a much better alternative to cigarettes for the millions of adult smokers who would otherwise continue smoking.

Why do you believe your background in technology would be useful?

For me, that vision to create a smoke-free future merging the worlds of tobacco and technology marks a new way forward and a rare opportunity to contribute to the complete transformation of a company and an industry for the better.

That seems like a big transformational leap. Could you elaborate a bit on how you plan to achieve that?

To date, PMI has invested more than $6 billion USD in science, technology and research to develop and commercialize smoke-free products that are a better alternative than continued smoking. While technology is, and will continue to be, a critical enabler for this transformation, like in other businesses it is only as powerful as its ability to enable human creativity and innovation to unlock opportunities for change by ensuring PMI becomes a "consumer-first" organization. During my tenure at Adidas, my philosophy and strategy were to put people at the center of all activities because they are your best proxy for the consumer you're trying to reach. Doing so helped me create centralized working models that leveraged technology and digital pathways to successfully deliver consumer-centric solutions.

What do you mean when you say “consumer-first”?

Where we once focused primarily on trade partners, we now focus on the adult consumer - legal age smokers who would otherwise continue smoking. I'm able to put my previous experience in digital transformation models to use at PMI - helping us become nimbler to anticipate consumer needs and transform PMI into a company with the consumer front and center. To succeed in this, we need a harmonized, secure technology operating model that gives our teams in the markets confidence and the tools they need to deliver our unique selling proposition to the adult consumer. And that's why we need a brand-new technology stack, new ways of working and unique skill sets we didn't have before in our organization. That's a tall task. And it's one I'm excited to be a part of.

What does this mean to your team and to you, as the CTO?

That means, first and foremost, understanding how best we can support adult smokers along their entire consumer journey to switch to better alternatives. From there, we determine how technology can help us achieve this at scale. PMI's new operating model in IT enables us to build data-driven, cloud-native, secure applications fast and frequently (as much as 10 times faster than today) so we can stay close to adult consumers and nurture innovation.

Would you say technology is essential to achieve PMI’s new vision?

PMI's business transformation doesn't start and stop with a novel IT operating model; our smoke-free future is not feasible without technological innovation and without experts in science, research and product development who together, are creating the highest impact by leveraging technology. We're just at the start of our technology transformation journey. There's lots to do - and it's fast-paced and motivating.

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