Brewing a new business operating model for Carlsberg

Profile picture for user Mark Chillingworth By Mark Chillingworth July 25, 2019
Summary:
Global Services tech leader Jawaz Illavia tells diginomica how data and nearshoring are creating digital market opportunities

An image of a Carlsberg beer bottle in a fridge

You may, or may not, be surprised to learn that when the summer of 2018 saw Europe enjoy a prolonged heatwave, it resulted in strong beer sales.

For the world’s third largest brewer, Denmark’s Carlsberg Group, last summer has enabled the organisation to embark on a $690 million share buyback programme and continued investment in technology renewal.  

Jawaz Illavia, VP for Global Services at Carlsberg, is brewing a new business operating model for Carlsberg as the organisation, which is 173 years’ old. He joined the Copenhagen headquartered business in October 2017.

Although we were behind in terms of starting the digital journey, it gave us the opportunity to leapfrog others who started before and who had large sunk costs. To follow the same trajectory of others who started 10 years ago would have been a travesty, so we need to use a Digital 3.0 mindset to fix the 1.0 problems. We also wanted to create the future in a new, fresh way that both challenges the norm, but also works in the Carlsberg culture.”

Carlsberg has a very high willingness to change and that comes from the CEO (Cees ‘t Hart) and he really started the transformational thinking that we need to pursue perfection for the next 173 years

Illavia says Carlsberg is honest about challenges and is therefore allowing an internal transformation project to flow through the business.  

As the third largest brewing business in the world, Carlsberg is responsible for a bar load of well known lagers such as Tuborg, Kronenbourg, Baltika, Somersby cider and Switzerland’s Cardinal, to name just a few. The Carlsberg Group has been going since 1847, employs 40,000 people, operates in 150 markets, and is brewing 140 brands.

Carlsberg is one of the brewing industry’s major success stories and one of Denmark’s great global businesses, as it competes with fellow industry giants: InBev of Belgium and the Heineken group of the Netherlands.

Cool role

With a job title of VP Global Business Services - Digital & Commercial, Illavia reports directly to the Carlsberg Group Chief Information Officer (CIO), with his major focus being technologies that drive sales, marketing as well as research and development at Carlsberg Group. He describes these as his vertical responsibilities.

Horizontally I work across the business for new technology and people capabilities, such as software engineering, design, product and data and analytics.

As a result, Illavia is one of a growing number of business technology leaders working closely with the marketing operation of a major enterprise. This rising trend is an awareness by the business community that a strong partnership between technology and marketing leaders can lead to a greater understanding of the customer and the ability to target sales more effectively. This development is driven by a shared knowledge and passion for data driven business opportunities. Illavia said: 

Let’s look at data analytics in a different way, we have a blank sheet of paper, so let’s use it wisely.

His approach has been to take inspiration from digital businesses, such as the giants of social media, to consider how to look at data.

Treating internal data like external data means we can avoid the painful, old-fashioned, master data management (MDM) programmes of the past. This has allowed us to clean up fragmented data sets much quicker than a corporate would normally be able to do.

Carlsberg also adopted a single data lake on Microsoft Azure in the cloud to ensure it now has a single place to work with data from. This has led to a mindset change within Carlsberg, Illavia says, with the business now much more aware that data is an asset that can be used to drive business goals.

Nearshore

Modernisation is more than procuring and integrating new technologies. Illavia and Carlsberg have had to develop and bring new skills into the business.  As a result, Carlsberg has adopted nearshore technology talent.

There are several considerations in getting the top talent into your organisation; for example, where do you put your talent? We have chosen Lisbon for our first global digital and analytics delivery centre.

The capital of Portugal provides Carlsberg with a wealth of available talent, good operating costs and access to a growing number of STEM graduates. He adds that Portugal has a culture that suited the Carlsberg business.

You have to build from the inside out and start with a few people who really have tentacles into the local tech ecosystem and build from there.

There is an openness to business and a lack of ego. Some nearshoring centres are getting saturated and losing that humility. In Lisbon our people pride themselves in doing do really good work. We are looking for creativity and some thinking that is a bit different.

Illavia has been developing the process development, data engineering, data architecture and product management abilities of Carlsberg - and Lisbon has been at the centre of this approach.

Underpinning the data strategy and new sales tools has been the major adoption of cloud computing. The Carlsberg Group enterprise resource planning (ERP) SAP platform is now hosted in the cloud and the brewer’s data resides in a Microsoft Azure data lake.

We replatformed our SAP from DB II to SQL at the same time as the migration to the cloud. It was a bold move, but it has meant our core data can be exposed through APIs to be used by technology start-ups who also now have the ability to work on a Carlsberg segregated Azure or AWS cloud. 

The power of this means we have both a core cloud for our enterprise platforms and a more flexible cloud where our partners can develop with us while not having to worry about data leaving the Carlsberg ecosystem.

Illavia joined Carlsberg with major change experience at fast moving consumer goods (FMCG) giants RB, makers of household goods such as Dettol, Air Wick, Harpic, Strepsols and Nurofen. Prior to joining the FMCG sector he worked for international advertising business RR Donnelley.