Wall Street firm fined $10 million for un-integrated systems

and other news for digital executives, by journalist Mitch Betts ▸ Digital initiatives at Delta Air Lines, BayCare Health ▸ CxO jobs & career moves ▸

Photo: geralt/Gerd Altmann/Pixabay/CC0 Creative Commons

FINRA fines Morgan Stanley for a transaction monitoring system that failed to monitor ‘tens of billions of dollars’ in transactions, due to faulty data feeds

Wall Street’s Financial Industry Regulatory Authority (FINRA) has fined Morgan Stanley Smith Barney LLC $10 million for lapses in its anti-money laundering (AML) program that spanned more than five years.

One big problem: Morgan Stanley’s automated AML surveillance system “did not receive critical data from several systems, undermining the firm’s surveillance of tens of billions of dollars of wire and foreign currency transfers, including transfers to and from countries known for having high money-laundering risk,” FINRA said.

Several data systems that should have fed into Morgan Stanley’s Transaction Monitoring System did not do so, because of “significant design limitations and programming flaws,” according to the detailed FINRA settlement document.

The document noted that a consultant had flagged problems with the data feeds in 2015 and 2016, but the problems weren’t fixed until February 2017.

In addition, FINRA said Morgan Stanley “failed to devote sufficient resources to review alerts generated by its automated AML surveillance system, and consequently Morgan Stanley analysts often closed alerts without sufficiently conducting and/or documenting their investigations of potentially suspicious wire transfers.”

FINRA said the lapses occurred from January 2011 until April 2016.

In the settlement, Morgan Stanley neither admitted nor denied the charges, but consented to the entry of FINRA’s findings. “We are pleased to have resolved this matter from several years ago,” Morgan Stanley said in a statement to Reuters.

FINRA said Morgan Stanley took “extraordinary corrective measures” to improve its AML-related programs, such as adding staff, enhancing the automated transaction monitoring system; and revising policies & procedures.

In general, FINRA said it continues to find problems with the adequacy of some firms’ AML programs, including data integrity in AML automated surveillance systems. “Firms must ensure that their AML programs are reasonably designed to detect and cause the reporting of potentially suspicious activity,” said Susan Schroeder, FINRA’s EVP for enforcement.

Related: UBS Fined $15 Million Over Anti-Money-Laundering SystemsU.S. Encourages Banks to Innovate in Anti-Money Laundering ComplianceUsing AI to combat money laundering

Who’s doing what

Photo: Delta’s facial biometric terminal, via Delta’s news hub

Rahul Samant, CIO at Delta Air Lines Inc., posted a link to a roundup of Delta’s digital initiatives in 2018, including the following:

  • Delta customers flying internationally out of Atlanta and Detroit have the option to use facial biometrics instead of a boarding pass or government-issued ID to check in, check a bag, pass through security, and board their flight. The technology saves an average of nine minutes at boarding.

  • Delta’s proprietary Flight Family Communication platform helps employees working an assigned flight communicate directly with one another about the status of tasks and customer service items required before departure. One result: Employees spend less time traversing the jet bridge to talk with one another before departure. 

  • Delta’s Flight Weather Viewer app harnesses big data to give pilots a real-time visual display of airspace weather on their tablets, enabling them to avoid turbulence and to save fuel.

  • Delta offers RFID tags for baggage, which can be tracked via Delta’s mobile app. If a bag is lost, customers can file a baggage claim via the mobile app instead of having to visit the local baggage service office.

Photo: BayCare’s indoor navigation app, via PRNewsfoto

BayCare Health System, based in Clearwater, Fla., now offers a smartphone app that helps patients & visitors navigate the hallways inside their hospitals, according to Tim Thompson, SVP & CIO. The indoor wayfinding app is called BayCare Compass.

Talent: jobs, appointments, careers

The Miami Dolphins football team named Kimberly Rometo as CIO, reporting to Dan Caspersen, SVP for business administration. She was previously CIO at the AmericasMart trade center in Atlanta.

Russell Eubanks has been promoted to SVP & CIO at the Federal Reserve Bank of Atlanta. He was previously acting chief information security officer.

AutoWeb Inc., an Irvine, Calif.-based digital marketing platform for the automotive industry, named Tim Branham as SVP & CTO (a newly created position). Branham was previously an IT consultant to AutoWeb and, before that, CIO at Fujitsu Americas.

TenFour (formerly Alliant Technologies LLC), an IT infrastructure provider based in Morristown, N.J., added Scott Alcott to its board of directors. Alcott was CIO at Comcast Cable from June 2012 to January 2018.

Job openings:
  • State University of New York (SUNY) Downstate Medical Center, in Brooklyn, N.Y. is seeking a CIO. Salary: $154,842 to $267,756. “Experience in a healthcare IT turnaround environment with experience in hospital IT restructuring is preferred.”

  • Hartford Steam Boiler Inspection & Insurance Co., in Hartford, Conn. — a global specialty insurer and reinsurer — is seeking a CIO (reporting to the COO, and overseeing application development and IT governance).

  • The Mayo Clinic, in Rochester, Minn., is seeking a chief security officer (CSO). Must have a master’s degree, and be able to obtain a government security clearance.

  • Merrill Corp., based in St. Paul, Minn., is seeking a CIO.

This is what underinvestment looks like

and other news for digital executives, by journalist Mitch Betts ▸ Digital initiatives at Lowe's, Jo-Ann Stores, Honeywell, Allstate ▸ Trends & innovations ▸ CxO jobs & career moves ▸

Photo: Lowe’s media resources

The C-suite at Lowe’s candidly reveals how the retailer ‘failed to keep up with advancements in e-commerce, IT, and supply chain’

Marvin Ellison, who joined Lowe’s Companies Inc. as CEO in July, quickly dispensed with the usual happy-talk — “a terrific company with an outstanding brand” — at Lowe’s annual Analyst and Investor Conference on Dec. 12. He then plunged into a critique of what he’d learned about the retailer in the past six months.

Ellison said Lowe’s had “lost its wayfailed to keep up with advancements in e-commerce, IT, and supply chain … [and] put our associates at a competitive disadvantage with outdated and cumbersome systems.”

He then mentioned the fact that two weeks prior, “our challenging IT infrastructure was evident on Black Friday when we experienced system outages. This system failure presented to the outside world what our associates deal with on a daily basis. It was an embarrassing moment for the company, but one that presented our current state to the world.”

Ellison then offered an anecdote about how Lowe’s handles big installation projects for customers:

While I was visiting a store recently, I posed a question to a group of associates. I said, okay, I am a customer. I am buying flooring, cabinets, countertops, a suite of appliances, so that kind of equals a kitchen remodel. So I said to the team how do we manage this kitchen project for the customer? So, you want to know what the associates showed me as our project management system? A dry erase board in the back of the store. So after I got past the shock, I had a follow-up question. I said, well, the customer didn’t have a dry erase board. So how did they keep track of the project? Their answer, well, Marvin, we give them a binder. So dry erase boards and binders as a project management system. [It’s] hard to believe that a retailer our size with our balance sheet is working with these systems in 2018. But this is the position we put our associates in. So, the question I asked myself is, how much would our sales and customer engagement improve with modern systems?

Ellison wasn’t the only Lowe’s executive with stinging critiques. Joe McFarland, Ellison’s hand-picked EVP for stores, said he found that Lowe’s “order management systems were archaic, split between multiple platforms that didn’t speak to each other and didn’t properly connect back through our supply chain, so they didn’t have an accurate view of available inventory.”

The labor scheduling system? “The current system is antiquated, ineffective and does not properly predict labor trends,” McFarland said. “It generates schedules 13 weeks in advance and does not schedule labor hours to align with customer demand patterns by department. This has resulted in significant ineffectiveness as well as wasted time for managers overriding and editing the schedules.” He said Lowe’s is now implementing a new scheduling system “informed by customer data to better predict customer demand by time of day, day of week, and by department.”

The point-of-sale systems? “We are replacing a cumbersome, outdated, green screen with a graphical, modernized, intuitive selling interface to make it easier for our associates to navigate — and faster for us to train new hires and seasonal associates,” McFarland said. (“As we hire new cashiers,” he noted, “a lot of them have never seen green screens before.”) And the new touch-screen interface may shave 10 seconds off of every transaction,” McFarland said.

As previously reported, Lowe’s is also rolling out handheld devices for mobile checkout by associates in the aisles; the retail-specific smartphones, from Zebra Technologies, “will be in all stores by the end of March,” McFarland said.

Finally, Seemantini Godbole, the new CIO at Lowe’s, provided her deep-dive assessment after four weeks on the job:

What I found is that Lowe’s technology is well behind leading retailers in terms of strategy, architecture, process maturity and capabilities. Our store and supply chain systems were developed in the ‘90s, while our merchandising, pricing and digital systems are rooted in early 2000s. Only our back-office system really measures up to current standards, and that’s obviously not ideal for a customer-facing organization. Leading retailers have modernized their technology platforms and advanced their digital capabilities through investment in software engineers and targeted acquisitions. However, at Lowe’s we have historically under-invested in talent and technology, opting instead to use off-the-shelf software packages and then heavily customizing them, resulting in poor integration, difficult upgrades and slow responses to business needs.

Inconsistent leadership, evidenced by the rotation of five CIOs in last eight years, [led to] an inconsistent strategy and low accountability, which in turn delivered poor results.

Godbole then sketched a plan to invest “$500 million to $550 million in capital per year through 2021” to produce modern, omnichannel retail systems. The plan includes:

  • Moving to cloud-based systems (only 5% of applications are now in the cloud).

  • Implementing a new IT operating model based on “product teams,” i.e., “pairing engineers with product managers and business experts to co-innovate and deliver functionality faster.”

  • Building more home-grown systems for competitive differentiation, instead of highly customized commercial software packages.

  • Hiring over 2,000 software engineers over the next few years.

  • Improving the customer experience (including stability & speed) at Lowes.com.

In closing, CEO Ellison said “some of you maybe disappointed that we are not going to spend time today updating you on our strategies to leverage virtual reality in the home, [or] by outlining the importance that artificial intelligence will play in our decision-making. Don’t be concerned, these are very important elements of our current and our future strategy.” But Ellison said he thought it was more important to provide a “transparent view” of “our immediate plans to improve our retail fundamentals.”

Who’s doing what

Photo: Custom-designed fabrics, via Jo-Ann Stores / Business Wire

Jo-Ann Stores LLC launched an online program, MyFabric, that lets customers personalize the design of sewing fabrics. Customers can select from thousands of designer patterns; customize the color, scale and repeat of the pattern; and choose from dozens of high-quality fabric substrates, the retailer said.

Honeywell Aerospace has set up a website for buying & selling aircraft parts. The e-commerce platform, GoDirect Trade, “uses blockchain technology to ensure every listing includes images and quality documents for the exact part being offered for sale,” the company said.

Allstate Insurance Co. plans to use high-resolution, aerial images of housing for multiple applications: writing & pricing new home insurance policies; looking at initial damage to homes; and mobilizing agents after disasters, according to Eric Huls, Allstate’s chief data & analytics officer.

Trends & Innovations

The No.1 target for artificial intelligence software development? ERP. In a survey of application developers, 58% said they’re adding AI capability to their ERP software. — Evans Data Corp.

Retailers are encouraging consumers to use their “branded digital wallets” for mobile app payments via the ACH network, hoping to bypass the $90 billion in fees retailers pay for credit-card transactions. — Jennifer Surane, Bloomberg News

Northern Trust Corp., a financial services company based in Chicago, has developed a blockchain-based system for creating an “immutable digital meeting record.” The Web-based meeting system authenticates participants via biometric data from their devices; captures meeting actions by each attendee; attaches smart contracts; and produces post-meeting documentation appended to the blockchain. (U.S. Patent No. 10,146,947)

Pizza Hut doubles down on digital to battle Domino's

and other news for digital executives, by journalist Mitch Betts ▸ Digital initiatives at Target, Hertz, Vail Resorts ▸ CxO jobs & career moves ▸

Photo: marckbass8/marcos vega/Pixabay/CC0 Creative Commons

Pizza Hut turns to an acquisition to help it compete for online orders

Pizza Hut — playing catch-up to the Domino’s Pizza Inc. juggernaut in online ordering — has decided to acquire the external technology & talent. The U.S. business of Pizza Hut, a subsidiary of Yum! Brands Inc., said it will acquire QuikOrder, an online ordering software & service provider for the restaurant industry. Terms of the deal were not disclosed, but it’s one of Pizza Hut’s largest acquisitions. 

“This acquisition will allow us to be more nimble and flexible from a digital and in-restaurant technology standpoint,” Carol Clements, Pizza Hut’s CTO, told Moneyish. “We’re thinking bigger than just Pizza Hut… This technology has the potential to be scaled across the entire Yum! family,” Clements said. (Yum! Brands also owns Taco Bell and KFC.)

Pizza Hut has already been using the company’s technology as a customer for nearly two decades. “In 2018, about half of Pizza Hut U.S. sales were processed through QuikOrder’s platform,” Pizza Hut said in its announcement. Meanwhile, QuikOrder “has built an expert team that fully understands and meets Pizza Hut’s specific needs.”

The acquisition will include: Pizza Hut’s current digital ordering platforms, systems & services; QuikOrder’s in-restaurant technology; and future products & programs.

“We’re doubling down on our commitment to digital and this deal positions Pizza Hut perfectly for the future,” said Artie Starrs, president of Pizza Hut U.S. “We're also gaining access to an immensely talented group of developers and digital innovators.

Who’s doing what

Photo: Target Corp. blog post shows the AR smartphone application in action.

Target Corp.’s augmented-reality (AR) shopping tool has Christmas trees selling at twice the normal rate, according to Dawn Block, SVP of digital. The retailer is offering a new feature, dubbed “See It in Your Space,” on its shopping app. It allows smartphone-toting customers to virtually place an artificial tree, or other home decor items, in their living room. — Matthew Boyle, Bloomberg News

Rental-car company Hertz Corp. is offering its Hertz Gold Plus Rewards loyalty members a faster checkout experience at the exit gate, using biometric screening technology that verifies a customer’s identity and rental reservation with facial or fingerprint recognition. The technology was launched at Hartsfield-Jackson Atlanta International Airport, and will be rolled out to 40 more U.S. Hertz locations in 2019.

Vail Resorts Inc. plans to reduce the wait time for guests at its 17 North American ski resorts, starting with the 2019-2020 winter season. The goal is to increase express lift ticket fulfillment capacity by 40% through new handheld, mobile technology that lets skiers & snowboarders bypass the ticket window altogether, and obtain their RF-enabled lift ticket from roving ticket agents at base area lifts. Guests will then be able to move directly into the primary lift line to begin their day on the mountain.

Advance Auto Parts Inc. has completed the nationwide rollout of its MyAdvance website, which is geared to professional installers (not consumers). Automotive service shops & employees can use the portal for ordering parts, training, expert advice on troubleshooting, and interacting with Advance support staff.

Here’s an AI application that definitely produces ROI: language translation. Online marketplace eBay Inc. has rolled out the eBay Machine Translation (eMT) program for several language pairs, including Spanish-English. It quickly translates search queries and results between languages. For example, eMT translates a Spanish-speaking buyer’s search terms into English, allowing for a search of relevant English-language listings, then translates the search results into Spanish for the buyer’s review. An economic study found that eMT significantly increased international trade on the eBay platform: U.S. exports via eBay to Spanish-speaking Latin American countries increased by more than 17%. National Bureau of Economic Research (NBER) Digest, November 2018

Talent: jobs, appointments, careers

Digital executives appointed to the board:
  • Patricia (Patty) Morrison, former Cardinal Health EVP & CIO, was appointed to the board of directors of Baxter International Inc., a global medical products company based in Deerfield, Ill. Morrison will serve on the audit committee. (She also currently serves on the boards of Aramark and Splunk.)

  • Triton International Ltd. — “the world’s largest lessor of intermodal freight containers” — appointed Karen Austin to its board of directors, effective Jan. 1. She was CIO at PG&E Corp. from June 2011 to October 2018. (Austin served on the board of Verifone Systems Inc. from June 2014 through August 2018.)

  • Regions Financial Corp., based in Birmingham, Ala., appointed Zhanna Golodryga to the company’s board of directors, effective Jan. 1. She will serve on the compensation & HR committee, and on the risk committee. Golodryga is currently SVP & chief digital & administrative officer at Phillips 66, a diversified fuels & logistics company based in Houston, Texas. Before joining Phillips 66 in April 2017, Golodryga was CIO & SVP of services at Hess Corp.

Job openings:
  • Quest Diagnostics Inc. — a $7.4 billion, Fortune 500 company based in Secaucus, N.J. — is seeking an “SVP CIO & Chief Digital Officer.”

  • The County of Los Angeles (Calif.) is seeking a chief data officer. Salary range: $137,414.77 to $207,988.44.

  • Intermountain Healthcare, in Salt Lake City, is seeking a chief analytics officer, reporting to the COO.

Digital executive career moves:
  • DISH Network Corp., based in Englewood, Colo., appointed Atilla Tinic to the role of SVP & CIO. (He was SVP of IT at CenturyLink Inc.) Tinic will report to COO John Swieringa (who was DISH’s CIO in 2014-2015). DISH also named Suma Nallapati as SVP & chief digital officer (e.g., handling marketing tech and e-commerce) — reporting to the new CIO Tinic. Nallapati currently serves as the Colorado state CIO and will join DISH in mid-January when a new state administration takes office.

  • Owens & Minor Inc., based in Richmond, Va., appointed Joseph Pekala as SVP & CIO. For the previous four years, Pekala served as CIO at ACCO Brands Inc.

  • Leandro DalleMule left his position as chief data officer at insurer American International Group Inc. (AIG) to join an insurtech startup, Planck Resolution, as general manager for North America. Planck Re, founded in 2016, calls itself an “AI-based data platform for commercial insurance.”

  • Envision Healthcare Corp., in Nashville, named Kristin Darby as CIO. She was previously enterprise CIO at Cancer Treatment Centers of America.

  • Liberty Mutual Insurance, based in Boston, announced the appointment of four executives to CIO James McGlennon’s technology leadership team: Monica Caldas as CIO for Global Retail Markets; John Heveran as CIO for Global Risk Solutions; Katie Jenkins as chief information security officer (CISO); and Michael Willock as CTO for Liberty Mutual Investments.

  • Synovus Financial Corp., based in Columbus, Ga., hired Zack Bishop as EVP of technology and operations. He was previously EVP & CIO at Renasant Bank.

  • Michael Ruttledge will join Citizens Financial Group Inc. in Providence, R.I., as CIO, effective Jan. 7. He recently served as a group CIO at American Express. Ruttledge succeeds Brian O’Connell, who is retiring.

  • Roadrunner Transportation Systems Inc., based in Downers Grove, Ill., named Michael Rapken as CIO.

  • Teena Piccione was named EVP & CIO at RTI International in Research Triangle Park, N.C. She was SVP for IT and COO at Fidelity Investments.

  • Mike Brown was named CIO at Matrix Medical Network in Scottsdale, Ariz. He was previously CIO at AccentCare Inc.

  • Texas-based Producers Ag Insurance Group Inc. (ProAg) named Benji Borner as CIO.

  • Western Governors University (WGU), an online university based in Salt Lake City, named David Morales as SVP & CIO. Morales was previously senior director of engineering in Walmart’s IT department.

{Brain food} Time for ‘digital spring cleaning’

“Facing an explosion of digital clutter, resulting from two decades of rapid technology growth and innovation, people and organizations are rethinking what they really want,” says a new report by Accenture Interactive’s Fjord unit.

Years of organizational investment in innovation have left customers feeling inundated and overwhelmed, straining the demands on our time and attention. Whereas once we craved the novelty, excitement and instant gratification, we now crave more quiet and meaning in a noisy world. People and organizations are doing some soul-searching about what they really value, rejecting products and services that don’t meet their needs — in effect, changing the nature of our relationships with technology and brands.

Digital is facing a big spring cleaning: a time when we decide whether something still has value and relevance to our lives,” said Mark Curtis, Fjord’s co-founder and chief client officer. “Digital is now so widely adopted that its novelty has worn off. In their attempt to declutter, people are being more selective about which products and services they incorporate into their daily lives, choosing to disconnect, unsubscribe or opt-out if the value exchange is not mutual. Never before has the responsibility of [human-centered] design been more important.”

Carnival patents high-tech guest medallions

and more news for digital executives ▸ Tech developments at Lowe's, Walmart, 7-Eleven, JPMorgan, Consumer Reports ▸ CxO jobs and career news ▸

Photo: Carnival cruise line’s customer ID pendant, via PRNewsfoto/Carnival Corp.

Carnival’s ID pendant and network of wireless sensors provides keyless room entry and personalized service for high-end cruise guests

Carnival Corp., a major leisure travel company, recently obtained three U.S. patents for its innovative OceanMedallion, a wearable ID device that unlocks doors, streamlines food orders and payment, provides navigation advice, and helps the ship’s staff provide personalized customer service.

U.S. Patent No. 10,037,642 was issued for the medallion, “which contains a proprietary blend of communication technologies including Near Field Communication (NFC) and Bluetooth Low Energy (BLE), as well as other non-disclosed capabilities,” the company said in a statement.

The medallion connects to “an intelligent shipboard network to provide crew members relevant information about each guest to enhance guest-crew interactions and deliver a high level of personalized service,” the company said. Carnival has dubbed the guest service technology an “Experience Internet of Things” (xIoT) network — the focus of the company's second patent (U.S. Patent No. 10,045,184).

The company describes the xIoT as “an invisible network of thousands of interactive intelligent sensors and embedded devices mounted throughout the ship, as well as select ports, linking individual guest and crew devices, shipboard software and hardware, as well as synchronized cloud computing to form a unified guest experience platform.”

Carnival’s third patent (U.S. No. 10,049,516) was awarded for its “smart door portal,” which leverages NFC, BLE, proximity sensors and cameras to allow guests to enter their stateroom without the need for a room key or card.

The pendant — which debuted at the CES event in January 2017 — is currently limited to MedallionClass vacations on the Caribbean Princess ship from Princess Cruises, one of Carnival’s nine cruise line brands.

The three patents list the lead inventors as John Padgett, chief experience and innovation officer at Carnival, and his team of guest experience professionals, many of whom previously worked at Walt Disney Parks & Resorts (known for its MagicBand wristbands, which are somewhat similar to the OceanMedallion in terms of guest experience).

CEO at Lowe's finally finds a CIO — snatched from Target — to fill out his revamped C-suite

Lowe's Companies Inc. on Nov. 2 announced the appointment of Seemantini Godbole as CIO, effective Nov. 12. She currently serves as SVP for digital and marketing technology at retailer Target Corp.

At last report (Sept. 6), Lowe’s incoming CEO Marvin Ellison had filled out most of his new C-suite but was still hunting for a CIO who had strong retail experience. The Lowe’s announcement explained why Ellison made this pick:

Godbole brings to Lowe's more than 25 years of global technology experience. She helped lead Target's digital technology transformation, including the re-architecture of the company's digital platforms, implementation of agile product management and the introduction of technology for new customer experiences including the mobile applications, buy online and pick up in-store and ship from store programs, guest order fulfillment, digital wallet, localized pricing, and customer loyalty and engagement offerings. Godbole has led development of long-term technology roadmaps, portfolio planning and engineering, operational support functions and e-commerce platforms.

Related: Home Depot, Lowe's hint at digital plans

Who’s doing what

Microsoft Corp. and Walmart Inc. will open a joint engineering office in Austin, Texas, as part of their new five-year-strategic cloud partnership. Called 4.co, the project will involve engineers from both companies working side by side to develop new internal applications that use Microsoft Azure, as well as migrating existing operations to the cloud. Walmart CIO Clay Johnson said the two companies have already been working on building internal chatbots, starting with a chatbot for employees to ask questions about their benefits packages, using Microsoft’s Cortana framework. With Microsoft’s help, Walmart also installed temperature sensors in the retailer’s refrigeration and freezer systems to avoid food spoilage. — Anna Hensel, VentureBeat

7‑Eleven Inc. is testing a Scan & Pay checkout alternative at 14 of its Dallas-area stores, using the retailer’s mobile app, which is already integrated with its loyalty program. Scan & Pay works on Android and iOS devices and is available for all 7‑Eleven merchandise except items that require cashier assistance — hot foods, financial services and age-verified products such as alcohol, tobacco and lottery tickets.

Marta Tellado, CEO of Consumer Reports (CR), recently described several digital initiatives to boost the organization’s revenue and customer engagement: ▸ Increased spending on content development, such as providing CR content via Amazon’s Alexa and Google Home; Instagram and Facebook; and investigative journalism and data journalism. ▸ Direct links from online CR reviews to purchasing the products at e-commerce partners. ▸ A browser plug-in (in beta testing) for members so that “if you’re searching on shopping sites, say Amazon for leaf blowers, for example, and if you have that plug-in, across the top of the screen you’re going to see [trusted] ratings and advice from Consumer Reports on the best models.” ▸ Selling CR’s aggregated consumer trend data to expert audiences — regulators, engineers, product designers. Chris Roush, Talking Biz News

JPMorgan Chase & Co. made a strategic investment in Inpher Inc., which has pioneered a cryptographic “Secret Computing” platform in which data remains privacy-protected while being processed in machine learning models

No paper towels? The “Restroom of the Future” is here, with “secure, proprietary, cloud-based wireless technologies and cutting-edge sensors” so that facilities staff can remotely monitor and analyze restroom conditions, and quickly fix any problems or outages. This Internet of Restroom Things is brought to you by GP PRO, a division of Georgia-Pacific LLC that manufactures paper goods, and TOTO USA, a giant maker of luxury plumbing fixtures.

Talent: jobs, appointments, careers

From CIO to CEO to chairman of the board: Vanguard CEO Tim Buckley will become chairman of the $5.3 trillion investment management firm, effective Jan. 1, 2019. Earlier in Buckley’s career he rotated through various Vanguard roles, including serving as Vanguard’s CIO from 2001 to 2006.

More digital executives were recently appointed to corporate boards of directors:

  • Signet Jewelers Ltd., the world’s largest retailer of diamond jewelry, appointed Zackery Hicks as an independent member of its board of directors. Hicks is chief digital officer of Toyota Motors North America Inc., and CEO of Toyota Connected Inc. The retailer said it expects to benefit from Hicks’ data analytics experience and start-up mentality.

  • TrueCar Inc., a digital automotive marketplace based in Santa Monica, Calif., appointed Phil McKoy — the CIO at UnitedHealth Group to its board of directors.

  • Workiva Inc., which provides a cloud-based data collaboration and reporting platform, appointed Brigid A. Bonner to its board of directors. She is currently chief experience officer at CaringBridge, and earlier in her career was CIO at UnitedHealth Group.

  • Regional power grid operator Southwest Power Pool Inc., based in Little Rock, Ark., elected Darcy Ortiz and Susan Certoma to the company’s board of directors. Darcy previously held technology management roles in the financial services industry, including as CIO at Wachovia Bank’s corporate and investment bank. Certoma is Intel Corp.’s VP of corporate services and was previously an IT VP at Intel.

  • First Independence Bank in Detroit appointed Earl Newsome to its board of directors. Newsome is global CIO at Praxair Inc., an $11 billion industrial gases company.

Job openings for digital executives:

Mars Inc. exploits machine learning in a big way

and more news for digital executives ▸ three former CIOs get board seats ▸ CxO jobs and career news ▸

Photo: B3R3N1C3/Berenice Calderón/Pixabay under CC0 Creative Commons

Candy-maker Mars is getting millions of dollars in value from a robust set of machine learning projects — and hopes to involve all ‘Martians’

Mars Inc. has worked on over 55 machine learning projects in the past year, according to the company’s chief digital officer, who said the ultimate goal is having “every Martian — and yes, we call ourselves Martians — every Martian amplified with machine learning.”

Sandeep Dadlani, chief digital officer at Mars, described the company’s robust machine-learning activity during an open-access webinar produced by analyst firm HfS Research Ltd. on Oct. 5.

Mars is a family-owned, global business with over $35 billion in sales; it’s best known for its candy business (M&Ms, Snickers, Twix, Milky Way, Dove), but has an even bigger business in pet healthcare.

Dadlani said Mars has worked on 55-plus machine learning projects across the company in the past 12 months, in fields as varied as email marketing, radiology, commodity trading, sales, monitoring pet health, R&D, supply chain forecasting, and manufacturing. By using machine learning for consumer sentiment analysis, for example, Mars can find out “what consumers are really saying about our brand right now — like right now,” he said.

One interesting-but-older example of machine learning took place in Australia, where Mars used machine learning and a 3,000-word lexicon of words to measure the level of anger on the Internet. As part of a 2016 marketing campaign, the angrier the Internet got, Mars would lower the price of Snickers candy bars at 7-Eleven convenience stories.

“This is a complex problem to solve,” Dadlani said, “when you have to analyze 14,000 social posts, understand the anger sentiment, and then execute a price change physically in retail 7-Eleven stores every 10 minutes.” The result of this creative experiment: 67% growth in sales, and 4 million new consumers reached.

Overall, Dadlani said, “I feel machine learning and AI has thrived in Mars, especially over the last year.” An independent study found that Mars has “unlocked hundreds of millions of dollars of value” from its machine learning projects in the last 12 months, he said.

“We have ramped up a team here internally of some of the most advanced machine learning [and] neural network scientists, who have helped us then manage a partner ecosystem of two or three agile partners (who do dozens of machine learning projects for us every day), and 25 start-ups who do very unique, extremely advanced work for us.”

“The opportunity, however, is to make this 100 times more powerful in every part of Mars. That is what we are working on.”

Asked about the single most important factor in pursuing machine learning, Dadlani replied: “Find the right problem,” meaning work on a clearly defined business problem that’s well-suited to machine learning.

Dadlani emphasized that Mars doesn’t have a machine learning strategy; it has a business growth strategy, and looks for ways automation can help. “I'm most scared of stakeholders who come in and say ‘we have a lot of data, we should do something with it.’ I love stakeholders who come and say ‘I have a [business] growth problem, can we solve it together.’”

To that end, Dadlani put the company’s senior leadership team through a “Machine Learning in One Hour” training program, guaranteeing that “anybody could learn machine learning.” The executives competed with each other to create a better machine learning algorithm in one hour, Dadlani said. One result: “In the last few minutes, they realized that, if they had 10 times the data they had, the accuracy of the algorithm increases massively.”

Once executives have hands-on experience with machine learning, “then people start appreciating what kind of problems can be solved, and what kind of talent is needed” in every department, Dadlani said. “Our dream, our vision, is to make every Martian proficient in analytics, machine learning, and so on,” he said.

Talent: jobs, appointments, careers

Boards appointing tech experts:

  • Monte Ford was appointed to the board of directors at Iron Mountain Inc., in Boston, effective Nov. 1. Ford, 59, is principal partner for the CIO Strategy Exchange (a cross-industry consortium of 50 CIOs from large companies). He previously was CEO at Aptean Inc., and CIO at American Airlines. Ford currently sits on the boards of The Michaels Companies Inc. and Akamai Technologies Inc.

  • Denise Clark was appointed to the board of directors of Caesars Entertainment Corp. in Las Vegas. She recently retired from Estée Lauder Companies Inc. after serving as CIO from 2012 to 2017. Clark is also on the board at United Natural Foods Inc.

  • Kimberly Hammonds was appointed to the board of directors at cloud content vendor Box Inc., based in Redwood City Calif. She was previously COO and CIO at Deutsche Bank AG, and CIO at The Boeing Co. Hammonds also serves on the boards of Cloudera, Red Hat, Tenable, and Zoom.

Job opening: The Massachusetts Port Authority in East Boston is seeking a CIO. (Deadline: Nov. 16.)

Digital executive appointments:

  • Jim Scholefield was named chief information and digital officer, effective Oct. 29, at Merck & Co. Inc. in Kenilworth, N.J. He was previously CIO at Nike Inc.

  • Lidia Fonseca will join Pfizer Inc.’s new C-suite (under incoming CEO Albert Bourla) as chief digital and technology officer, starting in January. She was CIO at Quest Diagnostics Inc.

  • John Dykstra was promoted to CIO at Skanska USA, a major construction and development firm based in New York.

  • Sanjeev Addala was named to the newly created position of chief digital officer at global power company The AES Corp. in Arlington, Va. He previously had the same title at GE Renewable Energy.

  • Avi Dasgupta was promoted to CIO at Monro Inc., an automotive services company in Rochester, N.Y.

  • Jon Herberger was named CTO at LaserShip Inc., in Vienna, Va. He was previously CIO at PLS Logistics Services.

  • John Engelstad was appointed CIO at PGT Innovations Inc., which makes premium windows & doors, in North Venice, Fla.

  • Mike Capote was named CIO at DadeSystems in Miami.

  • Jamie Patel was named CTO at American Century Investments in Kansas City, Mo.

  • Dinu Parel will succeed William G. Eline as CIO at Parker Hannifin Corp. in Cleveland. Eline is retiring after 40 years at the company.

  • Joseph Fousek was named CIO at law firm Bond, Schoeneck and King in Syracuse, N.Y.

  • Laurie Douglas, CIO at Publix Super Markets Inc., in Lakeland, Fla., was given additional responsibilities as chief digital officer.

  • Barry Simpson, the CIO at The Coca-Cola Co. in Atlanta, is adding new duties that include oversight of portions of the company’s Enabling Services organization, effective Jan. 1.

  • Randy McGarry was named CIO at Meridian Bank in Malvern, Pa.

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