Google Cloud CEO Thomas Kurian Unplugged: Innovation, Data & the Future

A classic Thomas Kurian story: “As for the value of data, if somebody just 2 years ago said to a retailer, ‘You will know and understand your customer a lot better when they never visit your store than you did when they actually came to your store,’ the retailer would have said, ‘That’s really crazy.’”

Yet, here we are.

Speaking with Kurian is always a high-speed intellectual adventure because he has the ability to not only see the future before it unfolds but to convey those images in compelling and often inspiring anecdotes. 

That vision—encompassing both the future of advanced technology and also the rapidly changing nature of the business world—have helped push Google Cloud to the #3 spot in my weekly Cloud Wars Top 10 rankings.

When Kurian and I spoke over Google Meet earlier this month, I asked him about trends among customers: what’s new in their priorities and objectives, how those goals are evolving, how Google Cloud is helping businesses of all types deal with the accelerating pace of change, and how the industry solutions that Kurian has been championing since the day he became CEO are driving massive change in the global economy.

I also want to be sure to point out that toward the end of Kurian’s first year as CEO of Google Cloud, the changes he instituted and the transformation he accelerated were so striking that I named Kurian our CEO of the Year for calendar 2019.

From our conversation, I’ve extracted several particularly compelling comments, and I want to share those with you in Kurian’s own words because he has an uncommon eloquence that stands very nicely on its own. And if you’d like to listen to the entire conversation, please check out this episode of Cloud Wars Live.

1. Innovation: 5 capabilities businesses need to help create the future

• “One is being the best in their industry, in the understanding and using of data. Because digitization, without understanding data, whether it’s understanding your customer, understanding your suppliers, understanding your supply chain, it’s not really possible.”
• “Second, do you have the infrastructure technology and the software-development skills to actually become a leader in the use of technology. Many companies that outsourced IT, as a result, they didn’t have the software skills in house and in critical areas, they need to build that capability in order to use technology in the future.”
• “Third, as they move data into the cloud, you read a lot about cybersecurity breaches and as data is becoming a critical asset, there are more and more threat vectors coming in on users, applications, and data. And so how do you make sure that, as more of your users become digital workers, they want to work from more places, how do you ensure that your systems, your applications and data are secure?”
• “Fourth, in spite all of this technology, innovation would not be possible if your people were not participating in it…. How do you make sure the creative, enthusiastic people that you have in your organization are given great digital tools to work in a hybrid environment?”
• “Lastly, …in our view, as Google, in a few years’ time, there won’t be intelligent software and non-intelligent software. So how do you use artificial intelligence and build a capability in your organization to use artificial intelligence more capably?” 

2. Industries in Upheaval: the Power of Co-Creation

“There are lots of different ways that we see this co-creation happening, and one example is software-development practices. We at Google stage an extraordinary number of changes weekly to our production fleets, both for the consumer services and for our cloud services. 

“One of the practices people want to master is this: if they’re going to become software driven, how do you make that possible? How do you make them faster? How do you make sure that they don’t cause issues when stage the fleet? And you can imagine that in a large financial market, CME cares about that. For a company like Ford Motor, when you do an over-the-air update, they care about it because they don’t want to have any vehicles having an issue.

“So one set is around how do to do modern software development, and the second is how do you build technology with a unique set of capabilities?”

….

“There are lots of different ways that we see this co-creation happening. Just as a very simple example, development practices. We at Google stage an extraordinary number of changes weekly to our production fleets, both for the consumer services and for our cloud services. One of the practices people want is if they’re going to become software driven, how do you make those possible? How do you make them faster? How do you make sure that they don’t cause issues when stage the fleet? And you can imagine kind of a large financial market, like CME cares about that. And even a company like Ford Motor Company, when you do an over the air update, cares about it because they don’t want to have the vehicle have an issue.”

….

“And then lastly, one of the biggest things that we see in this co-creation is that it requires not only an understanding of the domain, but also the opportunity to greatly simplify that domain. Once we understand the domain, we can take that technology and that capability and put it into the infrastructure so that it becomes much easier for people to manage.”

3. Customer Examples

CME (Chicago Mercantile Exchange): Modernizing Data and Co-Creation

“CME is a very important part of the financial system, the largest financial market in the world, and the discussions we had with [CME CEO] Terry Duffy and his team were all around three important things: first, improve accessibility in each of the financial markets. And as consumers want to participate in financial markets more and more, many financial instruments are now being traded off of regulated financial markets. They happen to be traded as crypto exchanges and things like that. So we talked about how do you broaden the nature of the products and services, as well as how do you broaden the reach of the financial market?

“The second is there have been many things done historically around modernizing systems, but we are working with CME on modernizing the use of data and the capabilities that we offer in the exchange through machine learning. For example:

• “Can we, through the understanding of data, improve how risk-management services are offered? 
• “Can we, through the use of machine learning,  improve how quickly trades settle and clear? 

“These are all capabilities that we will learn from the domain expertise that CME has as the largest such exchange in the world, and we will bring the engineering expertise to provide new platforms to make this much more broadly accessible.”

Ford: Modernize, Transform, Redefine the Customer Experience for Digital

“A lot of our work has been to bring technology, software, and our engineering practices to help traditional companies that have big ecosystems modernize and transform. If you look at the automobile industry, I think you’re seeing just a fundamental shift in that industry. You’re seeing a shift in the way that people discover cars. In the good old days, people would go to a dealer and drive a car. Increasingly, they do most of their discovery online, and then they may procure a vehicle by just driving it once. So the way that people experience a car, increasingly they want more of the services that they are used to, whether that’s entertainment, mapping, all of these personal services to be available with them in the vehicle. And then there’s changes also in the ability to understand, based on that, how you offer them better products by improving your manufacturing, quality assurance, all of those processes.

“And the work with Ford is a very comprehensive program across the way that we’re re-imagining with Ford a number of things:

• “What’s the nature of the vehicle? 
• “How does somebody experience the vehicle before they buy? 
• “How do they experience it after they buy? 
• “How do you change the notion of how you manufacture the vehicle, particularly as vehicles are increasingly more and more about software than about mechanical systems.”

Smartphone manufacturer: Quality inspection efficiency improved 400% with AI

“We worked with a major industrial manufacturer of almost all the smartphones and other things in the world. One challenge you have when you have quality inspectors on a manufacturing line in the pandemic is they can’t stand next to each other. And the second thing is the rate at which you can run the manufacturing line is proportionate to how quickly you can actually inspect the products at the end of the line. So they use our visual-imaging quality inspection technology that we’ve adapted specifically for manufacturing to improve quality inspection efficiency and speed by 400%. So not only did it keep the people safe, it also sped things up.”

Ikea: Co-creation using AI to boost recommendations for E-commerce

“We helped Ikea improve the accuracy and the efficiency of their recommendations by implementing our Recommendations AI with their E-commerce system. It’s not a simple problem, particularly when you think of buying furniture by looking at an online system, because people historically have wanted to touch the furniture, sit in the furniture, see it accessorized in the room. But working with Ikea, we learned a lot from them on how to make such an experience possible. But then the accuracy of our recommendation system has hugely helped them improve the experience for their customers.”

4. Helping customers drive growth: beyond cost-cutting

“We believe that, for the long term, for any technology, it can’t be just about cost-savings. It’s got to be about new capabilities, broadening revenue streams, opening up new markets, and providing the organization the ability to do things that they couldn’t do before. Today, technology can be applied in many more contexts.

“There was a great case study at our Next Event by Walmart and how they’re using our data platform. And the interesting thing is the number of different domains in which data is now being used, whether that’s on the distribution center to understand how to be more efficient for pick-pack-and-ship, whether that’s in the retail store to automate replenishment, whether that’s in the online system, their eCommerce system, to provide the right products and services to people, whether it’s in last-mile delivery to optimize logistics. These are all different domains in which data can be used to transform fundamentally the capability of the organization.”

5. The value of data and the simultaneous disruptions across industries

Here’s the full context for the anecdote I used to open this piece:

“As for the value of data, if somebody just 2 years ago said to a retailer, ‘You will know and understand your customer a lot better when they never visit your store than you did when they actually came to your store,’ the retailer would have said, ‘That’s really crazy.’ 

“And then if you told a customer today that there was a time—and I’m old enough to say I have experienced this—when we would go shopping before E-commerce and we would all drive to the store not knowing whether the product we had or wanted was there in the store. Those are profound changes that have been brought by the use of technology. And as we look forward, for example, how do services companies like wealth managers, financial-services institutions, insurance companies, and others transform the notion of what services mean, and what advisory means in a digital world? You’ve got to think through that.”

….

“And it’s fascinating to look at the changes that happen in industries, such as when a manufacturing industry becomes a software industry. You read a lot about how automobile companies, because of the current memory shortage, are not able to ship automobiles. And it’s because a mechanical-engineering industry changed to a software-based industry and so the auto companies were competing along with other computer and phone manufacturers for memory. And all of a sudden, there’s a shortage. 

“When you look at pharmaceutical industry, it used to be all about chemical experimentation to come up with new drugs. And now through the use of data, you see an enormous acceleration in the way that new therapies can be discovered.

“So in every domain, we see that the application of data, the use of technology, and the pressure and increasing speed of environmental consciousness, and technology transformation will all be driven by data and will all create new avenues that will require technology innovation in the years ahead. 

“And so we are very committed to helping customers who are facing that. Our general view is that Google was very fortunate that we were able to, when we brought out a cloud, build on years of experience in building large-scale consumer services. And so our expertise that we gleaned from that allowed us to stand on the shoulders of all those engineers who built that. 

“We now want all our clients to be able to stand on our shoulders as we support them on what they’re trying to do.”

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