H&M Group – Integrating Business and Tech (Europe 2021)

H&M Group – Integrating Business and Tech

londoneuropeplenary2021
DC

Daniel Claesson

Chief Product Officer, H&M Group

JK

Jakob Knutsson

Product Area Lead Engineer – Infra Platform Engineering, H&M Group

TRANSCRIPT

00:00:13

Thank you, Alfredo and Olympia. So about one year ago, I saw Jacob Knutson product area, lead engineer at H and M present at a conference. And I was so intrigued by his presentation that I reached out to him in our correspondence. He shared some amazing things that made me immediately ask whether he would be able to share his story here at DevOps enterprise, because I know their story will inspire this community. H and M group is a leading global fashion company, according to their annual shareholder letter. In 2020, they operated nearly 5,000 stores in 74 markets around the globe with net sales of 187 billion Swedish krona, which is about $22 billion us. I am so delighted that Jacob is co-presenting with Daniel, Clawson H and M groups, chief product officer, who is responsible for overseeing the strategy development and operations of all digital and tech products enhancing the shopping experience for customers to H and M groups. Global family of brands here is Jacob and Daniel.

00:01:25

Yes, I'll just bring out me.

00:01:29

My name is Bauer is done. I am Frederick

00:01:32

. It's very important for me to be hated. That's my view from blinding. When I dance, I just forget the outside world.

00:01:52

I am a machine learning engineer. We are looking in how their customers are behave as a group, or even as an individual. It's their magic with maths.

00:02:11

I am a software engineer. When you sink too long on a problem, maybe you get stuck when you do something else for a moment to solve the problem much faster. It doesn't turn out the way I wanted undo.

00:02:24

I am product owner F business tech, H and M of course, as a global company, it gives me great opportunity to interact with other stakeholders, different countries, cultures. We make sure that it's secure frictionless, fast and easy to pay.

00:02:40

What are the cool things that we can do? What are the ramps of possibility? We want to build that together with all these new people that will join us.

00:03:00

Last year, I was invited by gene Kim to present cloud and DevOps journey over the last years and how we're doing that at scale today, we will give you the other side of that story from a business perspective, as well as where we're heading in the future. And we're going to tell you why tech transformation is needed, how we got started and also implemented organizational changes and how that has allowed us to serve our customers and colleagues better. I'm really glad to be joined today also by our chief product officer Donald Clawson here to tell his side of the story and to break down the importance of incorporating tech into the DNA of our business. Tick is fundamental in everything we do. We're now living in the age of software. So are we a software company? No, I would still argue that we are a fashion and design company, but that we must master software at scale.

00:03:59

And if you go back a couple of years, we were a classical enterprise. It department heavily siloed, built for stability and expansion. This served us really well for a long time, but we were slow and there were a lot of handovers and bureaucracy. We actually started our first online shop in 1998, that was built around mainframe and already back then, they had a tight interconnection with our business, with a focus on globalization. They could quickly enter new online markets, but as they grow, even changing the color of a button took a lot of time. So they went from a few agile teams to scaling that, to eventually do waterfall. And around this time we also saw aggressor grassroots movement that we're exploring new ways of working new technologies that had marched and challenged different time-consuming processes. There were smaller agile islands popping up in different parts of the organization.

00:05:02

There were there's teams around the company that acted as change agents within our buying and production and within our own line. And then later also within AI and analytics and cloud as examples, what were our blockers? Where did those time-consuming handovers take place? And what were the constraints? One example is that onboarding a new development team and getting a dev environment up and running could take up to two to four weeks on premise. Whereas in the cloud, we have that fully automated and could provision a dev environment and a landing zone would integrate the dev tooling in under 10 minutes so that the team can start creating value and test their ideas instantaneously, fully democratizing infrastructure and provide a hundred percent self-service capabilities. We also pushed teams moving to the cloud to dev ops practices and to handle their own cloud resources, pushing the now known ideal from the unicorn project locality and simplicity so that the any team could independently develop tests and deploy value to the customer cloud gives us a faster pace, a better global scale value for money built, right?

00:06:15

Of course, and access to value added services and innovation. So we really can focus on our core. These teams could grow together and inspire each other. And everyone had a lean and dev ops mindset. We fostered a culture of automation, new ways of working and pushing responsibility left and teams really started to prove value. We also recognized that the number of deploys each team can do is a true competitive advantage. We were also having a lot of fun and had leadership that believed in us through to our values of having an entrepreneurial spirit, keeping it simple and believing in people. And this was the start of something new and the feeling was accelerating. This wasn't one person, one team. It was a movement in driving our digital business model. We've come up with several key tech principles. We want to be customer centric and become local everywhere, online and off.

00:07:18

And at every stage of our colleagues, customers and partners lives open. We want to move away from complex legacy integrations and use API APIs and events all the way. It should be easy to communicate with H and M in a secure way. And agile being able to release on demand, create value faster and continuously surprise and delight our customers. And also intelligent and data enabled. We have a lot of information and events flowing through our platforms, and we want to leverage that data to get insight, take data-driven decisions and enrich our business cases with AI and analytics. And finally global. We want to be able to provide a great customer experience to serve our customers in each unique market. At this time, we also started doing a lot of internal events and knowledge sharing, and we hosted forums, hack days, problem solving sessions and training.

00:08:17

We set up a developer portal to centralize the information started to build up shared reusable assets, reference architectures, reference implementations, and starting to form new golden patterns. But the community also live in different channels. You can ask questions and people from every part of the organization jumps in to answer. One of the most popular channels is called absolutely no idea. And it's amazing to see how fast things can get answered and resolved. This is our engineering community that we now call text bot. And the best part is it's democratized events and knowledge sharing, making sure everyone can schedule events and rich the entire community. And as you can see, we have 159 questions posted in the last 30 days that got over 729 replies. Talk about empower the community and shortening lead times pinging in the right team for your problem or collaboration. We really started to see a culture shift.

00:09:24

The agile islands, they grow whole division, started scaling and do big room plannings. The teams were building up speed and enabling innovation. And we also set up enabling teams to onboard others. Key development areas had been identified and anchored. So we were on a good path. The teams could go to work, but you can imagine where we're coming from. We don't turn around in a day, but now we had full focus. We always had the great values and these are combined really well with agile ways of working and a DevOps mindset. For instance, an example in change in our way of working resulted in moving from 18 to 24 months, feature deployment to three weeks, we still have some work to do. What's got us here. Won't keep us here. It's not enough. All these small steps led up to a bold decision to update our cloud strategy, saying that all of H and M group should run entirely in the cloud, supported by an organization that can build effective and secure cloud solutions. Using DevOps practices. This later grew into strategic tech transformation moves for our whole group, empowering our teams to having clear direction and objectives and having clear strategies and objectives helps a lot. DevOps, agile, decoupled architecture, AI and cloud are foundational building blocks for us. The vision is there. The foundation is there. Culture is there. Our focus areas now is to breaking down platforms, monoliths and system of records. And joining me now is our chief product officer Donna Clawson. Who's going to tell his side of the story.

00:11:12

Thanks a lot, Jacob. Thanks for having me really, really pleased to be here, to understand our journey also from a business perspective, I think it's important to understand some context are of where we are as a company and H and M group is really a family of different brands. And we haven't been around for a while. Of course, H and M is our biggest brand looking at fashion, looking at our industry, looking at retail in general, of course, this is probably the most interesting time in history of being in retail and it started before the pandemic, but it has really, really accelerated and of a lot of things are changing, but some things are also actually the same. If we look at our customers, a lot of the customer needs are actually still the same. The customers are still a person behind that actually wants to find what they are looking for. They want to look and feel good and they want to have a great experience and experience a great service and a great interaction with a company.

00:12:21

The things that really have changed is that with the rise of digital intake, we have gotten as a company, a completely new toolbox that we can use in order to serve our customers. So with this full context, we have realized that we can't and a longer make a difference between tech and business because business is take and take this business. And with this in mind, we actually took a step some years back in starting to explore. Is there another way of organizing ourselves to really make sure that this comes through and a year back, we established a new function that we then call business take. And this function is a consolidation of what before were our traditional it department, that the ICAP talked about our business development department and our AI department. And we formed this new function into a through product organization with a purpose of really bringing all the competencies needed into one team that can solve the problems they need for the customers.

00:13:38

So with this, we are taking some more steps. And the only thing we know is that we see clear tendencies that the only way forward is to continue to bring in business and take even closer to each other. Cause it's brings a lot of value for all the different perspectives of our business. Continuing with this, there is a thing for us, for these teams that we are now building, we are really trying to form the teams in a way that they can solve the problems for the customers and the business. And we are not just here to serve the business with this. We are, of course, did this lysing, our customer experience. We are digitalizing our colleagues' experience and we are digitalizing our full operations. And there has been that during this time, of course, a lot of different steps. And if you can call it a hard moments or important things that we really have realized, the first thing has been to really deeply realize that we can't any longer make this difference between business technology.

00:14:52

It really needs to go hand in hand and together. And the other one is that there's a big mindset shift in this as a business person, you need to understand way much more tech and what possibilities take brings to the table. And as a tech person, you need to understand the business problems to a deeper extent. But when this happened, when this happens in the teams, when we get the different competencies in around the table to really solve one problem, magic clearly starts to happen. But the mindset shift has been way, much harder to achieve and finding that way of working and that way of thinking than reorganizing or doing other stuff. So what's next in our minds, there is two things that we really are thinking in round and would love to have the help of this community to think around the first one is how do we continue to bring tech and business even closer together, because that is only one way forward and it's continuing that journey. And the second to what we are thinking around is connected to Omni channel and how to really utilize both logic, AI data, and all the tech we have, but that's the same time finding the balance. Cause we think it's a balance between tech and the human interaction. So would love to get the input from this community. And what do you see as this balance between human and take going forward with that? We would like to say big, thanks you for having us. Uh, it has been a true pleasure to being here together

00:16:39

And, uh, hopefully we will be back next year and tell you how far we come, our longer journey then. So thanks from us.

00:16:47

Thank you. And thank you. Yeah. Cool. Yeah.