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Influencers with Andy Serwer: Julie Sweet

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In this episode of Influencers, Andy is joined by Accenture CEO Julie Sweet for a discussion about the labor market, the state of the U.S. economy, and how Accenture is adjusting amid the 'digital transformation'.

Video Transcript

- When COVID-19 forced the world's biggest companies to move their operations online or risk massive losses, many turn to consulting giant Accenture. Through a flurry of acquisitions and new offerings, CEO Julie Sweet has turned the decades-old brand into a go to for what's next.

On this episode of "Influencers," Julie joins me to talk about how companies are weathering the supply chain crisis, whether office work will ever look like it did pre-pandemic, and why she's optimistic that corporate America will move faster to address climate change.

[MUSIC PLAYING]

ANDY SERWER: Julie, very nice to see you.

JULIE SWEET: Great to see you, Andy. It's been a while.

ANDY SERWER: It has. And I hope the next time will be in person. Of course, we're all waiting for that. And that's salient, of course, that point to the conversation we're having because, of course, COVID has informed how we all work. Your company has grown, in fact, thrive, Julie, during the pandemic. Has COVID actually sort of been an opportunity, in a way, for you all?

JULIE SWEET: Well, thanks, Andy. We have grown, although, we're not quite at 680,000 people yet. We are 624,000. But last quarter, we added 54,000 people in a single quarter. So we are clearly growing. And it's really rooted in what the pandemic accelerated among our clients was the need to digitally accelerate and to use technology. We all went online.

And you saw a lot of disruptions in supply chains. And what we've seen is that our clients have recognized that rather than taking a decade to transform, they need to undergo what we call compressed transformation and do more to enable their business differently through technology across the enterprise.

ANDY SERWER: When you talk about that digitizing of businesses and the acceleration there, what specifically is that work about? Can you give us some examples?

JULIE SWEET: Sure. Oh, let me tell you what's going on in the market. So let's give you two stories. When the pandemic hit two weeks beforehand, we had rolled out with Best Buy, curbside pickup to about 100 stores. Best Buy has been a leader for years in digital. They've done their supply chain the way they service employees, their omnichannels.

The pandemic hit, this is all public, we help them roll, go from 100 to 1,400 stores in 48 hours. And they just announced earnings recently. And I think Jim Cramer said something like Best Buy's results are to show that Amazon is no longer a death star, like just incredible. So contrast that with a retailer that we've been working with since 2016 and talked about curbside pickup since 2016.

And when COVID hit, they didn't have it. And they were not a digital leader. And so post the first wave, they said we have to do things differently. We need to move much faster. And so they partnered differently. They accelerated their transformation. They didn't build at all. And they actually rolled out curbside pickup to 9,000 stores in four months.

And we call that a leapfrogger. So today, what you're seeing is you have leaders who were already growing more than the laggards pre-COVID, about 2X. They're now 5X. And you have leapfroggers who said we're not just going to do me, too. But we're going to go much faster. That's what's happening in the market today.

ANDY SERWER: A lot of talk about the cloud. You have a big investment in something called Cloud First. What is that all about?

JULIE SWEET: Well, Cloud First, we put in place in September so about 12 months ago. And when you think about what's happening with leaders and leapfroggers, there's three things happening. The first thing is that they're Cloud First. So they're replatforming on cloud. The second thing is they're doing two times as many processes. And the third is they're shifting their budgets to innovation.

So we saw, when the pandemic hit, that we would have to move much faster to the cloud. And we created Accenture Cloud First. And we just announced our earnings. And to give you some sense of what that reflects is that we were at $12 billion when we created it. And we're now at $18 billion in 12 months.

And so again, it reflects what's happening with our clients is that for resilience, for health and safety, for growth, and efficiency, they have to move to the cloud and use data and emerging technologies, like artificial intelligence very differently.

ANDY SERWER: So this new form of work that we're enjoying right now-- many of us are enjoying it. Some of us are finding it more difficult. And it's obviously first of all, not static. It's changing as we move forward out of the pandemic, we hope. But it's also not all wine and roses. I mean, there are friction points. And let's talk about some of those because there are a few.

And one that's kind of making headlines right now, Julie, is supply chain and disruptions. Have you guys been working to help companies mitigate that? And what have you seen there?

JULIE SWEET: Absolutely. Well, the first thing that on supply chain is that for years, we've all focused on cost and efficiency. And when the pandemic hits, what companies realize is they needed to also focus on resilience. And resilience requires a different strategy. So more than one area of supply where they were maybe consolidating to larger areas, it requires oftentimes, a different location strategy.

But bringing you back to digital transformation, it also requires better tools to predict outages, to predict what consumer needs. And so we're really working with many of our clients to go all the way back from the customer to the actual manufacturing and to have that link be very different. So it's hard to underestimate what's happening. In fact, there was just a Gartner study of boards of directors.

And 93% said that the big opportunity in transformation and technology in the coming year would be in manufacturing and supply chain, which is a very accurate characterization of what we're seeing in the market.

ANDY SERWER: Right. And getting all those pieces of the supply chain to talk to each other, disparate companies and systems. A lot of opportunity there. Another issue, Julie, we're seeing the economy right now is inflation, whether or not it's transitory or not. And I think that the transitory discussion is sort of in the rear-view mirror. It seems like it's a little bit more here to stay than people initially thought. What are you hearing about inflation? What is your take?

JULIE SWEET: Sure. There's absolutely concern really around the globe. And also, it's been a long time since this was the pressure. Like many of us are old enough that we remember when inflation was something that we talked about. And again, there's a couple of things that clients are needing to do is to first of all, really plan differently and look at things like their supply chain and have different forecasting abilities.

And it comes back always, again, to understanding the market and being much more agile with being able to respond to the market.

ANDY SERWER: You're going to get out your Whip Inflation Now pen, huh? Remember those?

JULIE SWEET: Yes.

ANDY SERWER: Yes. Right.

JULIE SWEET: It's just like I was trying to tell my children what it was like to be in gas lines in the '70s--

ANDY SERWER: Oh, yeah.

JULIE SWEET: --every other day. So sometimes, youth is great. And sometimes, a little wisdom is good from age.

ANDY SERWER: We hope it's not "Back to The Future" there. Let's talk about employees and employment. So much going on there right now. I mean, there's the great resignation, huge demand for employees, attrition, people being hired away. We're seeing that all across the board. And then there's RTA or return to office and hybrid work. What is your plan for your employees right now at Accenture? You talk about all those people that you've added.

JULIE SWEET: Well, first of all, I want to introduce you to a new term. It's called "phygital," physical and digital. Now, why is that matter? Look, we were, pre-pandemic, one of the most global remote working companies in the world because we have teams from all over the world. We haven't had a headquarters in three decades.

But we've learned a lot about how you raise your game in both onboarding 100% virtually but also creating new connections. And since we do believe it is a permanent experience that all companies will have more people who work remotely, we've really rethought what's that experience. And so phygital is talking about how you think about the physical and the digital together.

So super simple example, when you started a new job pre-pandemic, you showed up someplace, right? And you had the excitement. You went home. And you said, this is what the coffee is like. And this is who I met. Well, we have all these people who are shutting their laptops. And then the next day opening their laptop from Accenture. And there was no physical connection.

And so he said, well, how do we solve that? And our employees, new employees now get a welcome box. And what does it have in it? Sure, it has its computer. But it has these little signs that are like the leadership-- that are like the posters that would have seen in the office, our sustainability promise, our leadership essentials. It has Accenture swag.

So when they set up their office, they have a physical connection in addition to a digital connection with their new teammates. At the same time, we just ordered thousands of Oculus headsets. Why? Because our onboarding is now going to include virtual reality. And virtual reality-- super cool these days. We're using Microsoft and Mesh-- is about having a shared experience with colleagues who you can't be together with.

And it's different than just talking like this. And so, really thinking about how you build connections and you bring the physical and the digital world together differently, we think is the long-term success for how you both engage, attract, and retain employees.

ANDY SERWER: Phygital, huh?

JULIE SWEET: Phygital.

ANDY SERWER: OK. But I mean, still you lose-- and we all feel this way-- the serendipity of interactions, chance interactions, the mentoring, the in-person mentoring. When you hear someone, a younger person making a phone call, a sales call and it's not going right, how do you try to address those problems, Julie?

JULIE SWEET: Well, here's what I would say. We, at Accenture, have made a decision that once you can go back to the office in all the different countries, we won't have any job that is 100% remote. But I would challenge you, Andy, to think differently about mentorship. I remember when I joined Accenture in 2010. I found it really interesting that career counsels-- so the people that mentor people-- were not physically in the same place.

And for us, it was a pretty simple thing. Our people work on lots of different clients, and they fly all over the place. And so you couldn't have that physical. Now, we have mentorship on the job. And sometimes, that means we're, even pre-pandemic, working together with someone side by side. But they were part of global teams. And so mentorship can happen and has happened at scale at Accenture for decades, not in person.

And so it's not that-- and believe me, I think in-person is super important, which is why we said we're not going to have 100% remote for anyone. But I do also think we have to think about how you use the tools, how you're setting it up. Are you even giving people time to be mentors? And it's a lot more than physical presence.

ANDY SERWER: Interesting. Some more questions about employment if you don't mind. It really is kind of a topic A right now. And this is one from our audience. What more can companies do to entice workers to join their workforces beyond just higher pay and work-from-home flexibility?

JULIE SWEET: I think that's a great question. And we have some research-- in addition to the leaders and the leapfroggers research, which I'm happy to make available to all of you, but we have research called Net Better Off. And we really took a step back as an employer and said, what's the value proposition? And so the easy things are things like training, of course, pay.

But it's also relationships. So how do you build that inclusive workforce and well-being? And so for example, we provide a lot of different wellness tools, and we've had 180,000 people go through our program that we do with Thrive, which is around the science of anxiety. It helps our employees decrease anxiety by 11%.

We provide on our teams a one-minute Thrive reset for mindset. And so being an employer that provides wellness also makes you attractive. Also things like we have a concierge for our LGBTQI employees that helps them manage like where can they get the right health care that are unique to LGBTQI. It's a way that we can provide our scale and our service.

We provide an electronic second opinion for our employees and their loved ones when they face things. And so thinking about the different components of people, and it starts with our leadership essential. We say to our leaders, to be a leader at Accenture, you must care about your people personally and professionally. And that is more important than any program, than any flexibility or perk, if you live that leadership essential.

ANDY SERWER: Great. I want to shift gears a little bit and ask you about your sustainability goals because they're ambitious. Offices to run on 100% renewable energy by 2023, which is right around the corner, net zero emissions by 2025. How are you going to get there? And you are more ambitious than many of your clients, I'm sure. Is corporate America working too slowly? So two questions there.

JULIE SWEET: Great. Yes. At the core of our strategy is to help our clients meet their sustainability goals and for us to have ambitious goals that we meet. And we are really proud because we're a leader in our industry. We're already at 50% for renewables. So we will absolutely make that. And as you said, it's not easy, particularly because we operate in over 50 countries around the world with offices.

And so how are we going to make it? We made goals, and then we treat it like a business priority. So even pre-pandemic, we said we were going to reduce travel structurally, which is hard for us because we have a lot of people who travel. But we had said structurally, we're going to do that. We've just announced that we're investing in projects that do not just buying credits but actually technology-driven products for providing sort of nature.

And it's everything from planting trees to other ways of actually having carbon reduction through technology and nature. And so we're investing in that. So that's how we're going to make it. I would tell you that corporate America and globally-- so across the globe-- they are committed three out of five CEOs. In a recent World Economic Forum study said that they believe they have to do more.

And we'll be doing more around sustainability that it's a requirement. So I'm very optimistic that post-pandemic, we're going to build back better and that every business will be a sustainable business, in addition to a digital business.

ANDY SERWER: I want to shift gears again, Julie. I have to ask you about one of your customers-- and that is Facebook-- and your relationship with them because my understanding is that you employ roughly about a third of the platform's content moderation workforce, which is thousands of people. There have been questions about how well that content moderation is working, in particular, with Facebook files and those stories from the "Wall Street Journal."

What's your reaction to this information? And just generally speaking, when you have questions like this about customers, how do you respond, and what's the process?

JULIE SWEET: Sir Andy, so first of all, I'm not going to comment on how many people that we employ because that's confidential information. So I'm not going to comment on that. And with all of our clients, we only talk about our work together when it's been approved. Now, Facebook and Accenture are very proud partners. And I want to be super clear that I am very proud of the work we do to keep the internet safe. That's all I have to say.

ANDY SERWER: OK. Fair enough. Another topic, creating equality for women in the workplace. You have said that it isn't rocket science. So why aren't we making more progress then?

JULIE SWEET: Because there's a difference between a commitment and being committed and an action plan. And so what we find is that it's not about a lack of good intention but the goals that need to be set are not always set in the same way that you set your revenue goals. And that too often, companies and many companies come to us to talk about what to change, say that this is somehow an HR issue as opposed to a business issue, which we all own.

And again, this is a place where while we're not making the progress that we'd like to make-- and frankly, the pandemic set us back because of the very public issues in challenges of women-- I am much more optimistic about not only the commitment across the globe-- and we're in every market-- but also the willingness to take actions. And we have a lot, a lot of people.

We don't do this as a business. But we do this as a partner because we believe that we will all make progress and inclusion and diversity by working together. And it's actually a core part of our strategy. We call it 360-degree value is to collaborate with our clients like joint employee resource groups, activities because we think it's a shared responsibility.

ANDY SERWER: Yeah. And I think your 2020 Diversity Report shows a drop off of women and minorities in the workplace overall, right? Is that because of the pandemic?

JULIE SWEET: Well, it really varies by industry. Obviously, just to be clear, not at Accenture.

ANDY SERWER: Right. It's a--

JULIE SWEET: So we are-- yes. So yes. So our overall workforce.

ANDY SERWER: To be clear.

JULIE SWEET: Right. Because I want to be clear, we have made progress across both women and ethnic minorities. And that, I think, is important because the way we've done that is by setting goals-- they're now public on both for women and racial minorities in the US, the UK, and South Africa-- and then having action plans and adjusting it.

Now, when you look at it overall, it varies by industry. It's hard to look at it only globally because in some industries hit by the pandemic, you had a higher percentage of women. And then in other industries, it's more about the lack of child care and so on. So we understand, I think, pretty well how the pandemic has hit. And now it's up to us.

And a great example is I'm the Chair of Catalyst. And some of our board members, who in the US-- it's a US organization around women-- some of our board members who have big manufacturing plants are talking about how they're super focused on making sure that they have diversity in manufacturing. Such a great focus area and not one that we've had. So a lot of work to do, but I do believe there's a lot of commitment to action.

ANDY SERWER: I want to ask you about you in a second, Julie. But first, another question I have to ask you is about minimum corporate tax. And 130 countries have recently signed on and agreed to that. What's your take on that? Is an international minimum tax a good thing?

JULIE SWEET: Look, I think that 130 companies agree to something and there is standardization, that's certainty for companies. And so we're a company that pays a lot of tax around the world. And like other CEOs, certainty really matters and then we can manage our business.

ANDY SERWER: So you grew up in Southern California. My understanding is your dad painted cars. Your mother was a beautician. Money was tight, and you worked your first job at age 14. So how did that upbringing shape you?

JULIE SWEET: I was really fortunate to have parents who believed that with hard work, you could do anything. And so I grew up not seeing the limitations of our financial circumstances as a limitation on my abilities. And I will be forever grateful to the gift my parents gave me and believing in me.

ANDY SERWER: You said you decided to go to law school before you even met anyone who'd done it. So how did you make that decision, Julie?

JULIE SWEET: It's really true. It's a great story because I was about-- obviously, I was going to have a lot of debt from law school because we didn't have the money to pay for it. And my professor literally said, have you ever met a lawyer? And I said no. So he introduced me to a lawyer. And not that, I think, that would have changed my views anyway. And I said, that's fantastic, and I went to law school.

ANDY SERWER: And you ended up working at Cravath, Swaine, & Moore, arguably the nation's most prominent and prestigious law firm. Ninth woman partner in history, what was that experience like working at Cravath?

JULIE SWEET: Yeah. I really feel proud to be a former Cravath partner. And one of the great things about Cravath is they did not care whether my father was a painter or a CEO. And they invested in me and built a real love of learning. And when you think about why can lawyers be great CEOs or transition to CEOs? It is about, I believe, in this world, we all have to learn.

And there's so much change going on. And lawyers are great consumers of information. So I got a lot of great learning at Cravath that I use everyday, which is primarily about how to learn and then make decisions.

ANDY SERWER: All right. I'm going to ask you a bonus round question about Cravath, OK? And this is the intersection of Cravath and business journalists.

JULIE SWEET: OK.

ANDY SERWER: You know where I'm going. Can you name-- and maybe there's more than one, but I'm thinking of one-- a very prominent, high-profile, very successful business journalist who is an associate at Cravath, Julie?

JULIE SWEET: Is that you, Andy?

ANDY SERWER: No. But I'm flattered that you said that. No. Jim Stewart. Jim Stewart from the "New York Times" and the "New Yorker."

JULIE SWEET: No, I did not know that.

ANDY SERWER: Cravath, Swaine, & Moore, yup.

JULIE SWEET: I'm not surprised because Jim is a great journalist.

ANDY SERWER: And he is.

JULIE SWEET: But that's great trivia.

ANDY SERWER: And he has a great legal background when you read this story, as you can see that in there. Anyway, so you left Cravath and became GC, general counsel at Accenture. Why did you make that move?

JULIE SWEET: In one hand, it's a personal story. I was 42 at the time, and my father had just died at the age of 68, which was really young. And I've been a partner for 10 years. And out of the blue, I literally got a call. And it was funny because Cravath had usually people who answered the phone. And my secretary had stepped away. And they said, we have this really interesting opportunity.

And they're looking for someone global, and we know partners never leave Cravath. But would you take it? And I took a meeting. And Accenture was a really exciting place. They wanted me because I was international. And I think at 42, I could see my future. And I said, you know what? I know what it's been. I've been a partner for 10 years. This is an opportunity to make an impact in a different way.

And I do think, looking back, that it had a lot to do with what I was going through personally and believing that you really just had to seize opportunities. And so here I am. And I did not think I was going to be the CEO of Accenture when I went and became general counsel. I will tell you that. But I feel incredibly privileged to have had the opportunity to come to Accenture and to now lead this great company.

ANDY SERWER: Yeah. And your predecessor in that position, Pierre Nanterme died in February of 2019, roughly a month after stepping down. And we recently saw a similar tragic situation, I guess I should add, with Hasbro CEO Brian Goldner. What did you learn from Pierre, and what was the transition like under those circumstances, Julie?

JULIE SWEET: Well, we transitioned first to David Rowland, who is our interim CEO and an amazing, amazing leader. And one of the things that Pierre taught us all-- and he really stood on the shoulders of all the partners who come before Accenture-- is we believe that leadership is never about one person. And we had a lot of strong leaders.

And I look at what Accenture does today in my leadership team, in our 9,000 managing directors, and it's all about them. And my favorite-- we have eight leadership essentials, we call them. So besides caring deeply for your people personally and professionally, my favorite is lead with excellence, confidence, and humility. And if you have humility, you will have great teams. You will be a learner, and you will remember that it's never all about you.

ANDY SERWER: And final question, Julie. As CEO and as a leader, you've emphasized the commitment to multiple stakeholders, clients, employees, shareholders, communities, what does that look like in practice? And you've made statements about Accenture's commitment to refugees and racial justice. Do you think CEOs are expected to speak out more?

JULIE SWEET: Well, what I would say is the way it looks in practice is our strategy is to create 360-degree value for our clients and for all of our stakeholders. So for our clients, you take climate change. We have invested in green IT software development so that when we are creating-- doing work for our clients, we're helping them reduce the impact on the environment.

We've invested in building an algorithm to identify child laborers so that when you're investing in your supply chain, you can build that into it. We're collaborating on inclusion and diversity. And this is part of what we deliver not just what we're hired to do with respect to the financial business case. And we do the same thing with Accenture. We measure our success. If you read our 10-K that's coming out or you saw our earnings, I did not simply say our financial metrics.

The first two paragraphs of my earnings script-- and I urge you to look at it-- said, we measure our success by the 360-degree value. And so delivering only on our financial commitments and not on these other areas, like our goals to be net zero by 2025, to have gender parity by 2025, we're at 46%, if we don't deliver on those, then we are not successful.

ANDY SERWER: All right. Julie Sweet, Accenture CEO. Thank you so much for your time.

JULIE SWEET: OK. Thanks, Andy. Great to see you.