Eric Chaniot, chief digital officer and senior vice president at global tire maker Michelin, is responsible for accelerating the organization’s worldwide digital transformation. Chaniot launched two startups and worked for both Hewlett-Packard and Apple before joining Michelin in 2015. He recently spoke to The Innovator about digital transformation, its challenges and how to overcome them.
Q : A 130-year-old French tire manufacturer may not seem like a likely pioneer but Michelin began its digital transformation early, launching tires-as-a-service or on-line navigation services in 2000. Where is Michelin on its digital journey ?
EC : This is just the beginning of our digital transformation. We don’t see ourselves as a tire company, we see ourselves as one of the leaders in mobility and if we want to continue to be one of the leaders in mobility we have to be much better at everything digital.
Q: What does Michelin mean when it says it wants to be a “mobility leader”?
EC: Everything we do — even on digital — is connected with the purpose of Michelin: to enable people and goods to travel in a better and more sustainable way.
Q: Where are you focusing your digital efforts?
EC: Our digital efforts are focused around the four pillars of our strategy : tires, services and solutions, mobility experience and high-tech materials.
Q: How is your digital strategy changing Michelin’s relationship with consumers and with your brand?
EC: Tires will remain core for Michelin for some time. The company does not own distribution channels in all countries but now you can buy tires from dealers through Michelin-owned websites or digital initiatives supporting its partner dealers. That effort, along with other initiatives, should help the company reach its strategic objective of a plus 20% increase in tire sales by 2020.
Q: Michelin is moving beyond connected tires into new types of services. What kinds of new services are you adding?
EC: We are looking at selling tires on a usage basis: people pay based on mileage. We already do that for trucks and we sell airplane tires based on the number of landings. We also have some contracts with military organizations. They don’t pay for the usage. We maintain the tires for them.
Q: Michelin has also moved into fleet management. How does that fit in with the overall strategy?
EC: When you start to manage a fleet of trucks guess what ? Our customers start seeing us in a very different way, as a company that can help them optimize their business, enable them to be more efficient and generate more margins. We are also convinced our fleet customers will give preference to Michelin’s tires so it is a way to both differentiate ourselves and drive the core business.
Q: How do you deal with change management?
EC: Only about 5% of a successful digital transformation depends on tech. The other 95% is about change management. No one ever tells you no but you can sometimes see in their eyes that they feel like saying it. Luckily, we are very close to our internal business partners and they now see the impact of our digital initiatives : this helps a lot making decisions.
Q: What have you learned during your tenure at Michelin that might be helpful to CDOs in other sectors?
EC: Digital transformation is all about accelerating while evolving the culture of your organization. Each company has a different culture and set of values. Build on your strengths and identify the specific cultural changes needed for the digital transformation of your own organization : convince the top management and communicate a lot on the stakes of the needed cultural evolution in terms of leadership and news ways of working. If you are clear on that you are on the right path!
