5 must reads for your weekend

We keep an ear to the ground for the interesting stats, insights and discussion points you need to feel in the know.

1. Fast failure

We’ve all been there; you get to your local McDonald’s ready to order your McMuffin meal only to find out you’re too late for breakfast. “It was the number one customer request for years: ‘Can you have breakfast available all day?’,” Kevin Ozan, CFO of McDonald’s says. “But we didn’t do it, for fear of complicating restaurant efficiency. Breakfast ended at 10.30 a.m.” All-day breakfast in the US was a win waiting to happen. Historically, McDonald’s would have tested a new idea for years before introducing it, but in this case the company went from initial testing to full rollout in a few months. “This was one of the first tangible signs that we were going to be a more agile and nimble organization,” Ozan says.

Same-store sales rose by 5% globally in the last quarter of 2015, with analysts attributing much of the gain to the new all-day breakfast. That validated the leadership’s perspective. Now they are on a mission to rid “risk” of its reputation as a dirty word among McDonald’s staff. Their goals: “fast failure,” experimentation and innovation, and evolving the company culture to operate more quickly.

How fresh thinking paid off at a fast food giant

2. Using the cloud to control the climate

Climate controllers have traditionally been stand-alone, disconnected units on top of office towers. A leading European manufacturer set out to digitize its entire fleet – building an Internet of Things structure that didn’t just change the product line – it changed the company.

Using cloud-based apps, hundreds of units were connected to transmit real-time feeds of fuel use, climate conditions, customer behavior and CO2 emissions. Highly accurate product data was generated on maintenance, faults and depreciation. The data streams were aggregated up to a real-time diagnostic of the products and customers. Finally, the IoT data was so valuable that the company has started an energy management business, earning revenues from energy savings and the reduced emissions of its customers.

The CIO Imperative: Is your technology moving fast enough to realize your ambitions?

3. Cybercriminals seize any opportunity. Don’t let them.

The FBI has taken note of a recent explosion in ransomware attacks, issuing a warning in November 2021 that attackers are using “significant financial events, such as mergers and acquisitions, to target and leverage victim companies for ransomware infections.” Likewise, the EY-Parthenon transaction cybersecurity team has witnessed increasing cyber attacks on companies doing deals, including cases that were very costly for the victims. Damage can include loss of protected information and data, exposure of trade secrets, legal judgments, fines and impact on customers and financial losses can pale compared to reputational damage. The stakes increase when there’s a deal at risk. For example, a $650 million acquisition by an airline of an aerospace component supplier fell apart in 2019 partly due to a ransomware attack that forced temporary factory closures at the target company. The supplier was acquired by a different company two years later. Most executives with a divestiture on their minds probably don’t automatically associate deals with breaches and ransomware attacks. But cybercriminals do.

How to keep cybercriminals out of your divestiture

4. Will the metaverse be sedentary?

Physical exercise demonstrably lowers depression and stress while improving quality of sleep. So, experiences in which people spend lots of time while remaining sedentary will predictably worsen mental health outcomes. Unfortunately, designing metaverse experiences in which people get real exercise — for instance, by walking or running within the metaverse using their legs — isn’t practical at the current time. Our bodies still inhabit the physical world, with all its walls to walk into and furniture to trip over. Solutions such as omnidirectional treadmills are cumbersome and require significant user investment — making them unlikely to gain widespread adoption. Will designers and engineers crack the code of physical locomotion in the metaverse? Or will a new generation of immersive and sedentary experiences lead to negative health outcomes?

How will the metaverse change our behavior as it reshapes experiences?

5. What price will you pay and when? The data knows.

How does the online shopping site know what you might like today? Or even know what you might pay for it? It probably started with the CFO office joining forces with data scientists. Price-point behavior gets overlaid with transaction data such as the type of product purchased, payment method, customer demographics and just to make it interesting, third party data like the weather and location at the point of purchase. The result – a projection of the optimal pricing for an age 18 to 24-year-old female customer who is using credit cards to buy gifts for the holidays when the weather is poor.

Six ways the CFO can use artificial intelligence, today

If you do one thing:

Don’t get stuck in the past. Fail fast, mitigate risk and create opportunities.

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