Conference by Fred donier for ESCP Europe EMBA students @insper São Paulo, October 16, 2017

1. LEADING DIGITAL TRANSFORMATION IN
BRAZIL
OPPORTUNITIES AND CHALLENGES
Fred DONIER – Founder & Ceo Crescendo
Round Table with ESCP Europe EMBA Students09/20/2017

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Agenda
1. Introduction
2. Brazil´s Digital Economy Landscape
3. Digital Transformation in the real world: Opportunities and Challenges
4. Conclusions and Perspectives

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Crescendo, a multicultural consultancy born in Brazil, with a strong international experience
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 Crescendo is a top management
consultancy born in Brazil in
1999 with a relevant international
experience in more than 15
countries (Latin America, Europe,
USA, Fast growth countries).
 We are dedicated to highly
customized collaborations with
our clients in the fields of strategy
and transformation management.
 Our team is involved in the
academic world and develop
specific methodologies,
approaches, expertises,
benchmarks, resources etc.

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Prestigious and diversified experiences in Brazil with large, medium groups and start-ups
Engineering, Infrastructure, Oil & Gas Process and Manufacturing Industries
ServicesHealthcare Retail / Omni-commerce
Education, Social and Non Profit Sector

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Agenda
1. Introduction
2. Brazil´s Digital Economy Landscape
3. Digital Transformation in the real world: Opportunities and Challenges
4. Conclusions and Perspectives

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Contrast between old and new Brazil economy is amazing despite the (slow) recovery from
the worst crisis of the Brazilian Republic history
2014 2015
2009 2013
2016
“Old Economy” “New Economy”
Source: Hootsuite / 2017 digital yearbook
Source: The Economist
2017

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Interpersonal communication at the center of Brazilian digital economy:
WhatsApp in Brazil is for smartphones as Rede Globo is for TV
◻ The highest penetration for an app in Brazil : 98.1% of Brazilian
Internet users with smartphones have the app installed on their
device;
◻ 97.5% of those who own the app say they use it every day or
almost every day to send or read messages
◻ 76.3% of monthly active users would like to communicate with
brands within the app;
◻ 70.1% would like to be able to ask questions and receive technical
support regarding products and services in conversations;
◻ 69.6% do not see any problem in doing negotiations in WhatsApp
Source: survey Panorama Mobile Time/Opinion Box

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
A dense Brazilian universe of ~5500 start-ups, of which 200 funded by VCs:
57% of the funds raised in Latin America between 2011 and 2015 have been invested in Brazil
8 Start-ups in Brazil funded
by VCs 2011-15
Weight of VC in Brazil vs
LatAm 2011-15 (value US$ bi_
Source: ABVCAP

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Startups funded by VCs in 2017 : Fintech leading the path
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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Start-ups in Brazil are part of a vibrant and diverse eco-system made up of networks,
accelerators, global & local VC's, educators, ...
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"Google Campus size shows the
strength of Brazil's startups
ecosystem“
Operation in SP is the largest in
the world in number of
members (89.000 after 15
months).
André Barrence, project director,
talks about achievements,
challenges and plans for the
future
Source: Magazine Pequenas
empresas Grandes Negócios
02.10.2017

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
The entrepreneurial culture is the driving force of the Brazilian digital economy, while the
challenges are the business environment, the skills and knowledge base
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Source: EY G20 - Digital Entrepreneurship - Barometer – 2016
 Entrepreneurial culture:
‒ #11 / 20
 Access to finance
‒ # 15 / 20
 Digital business
environment
‒ # 19 / 20
 Digital skills
‒ # 20 / 20
 Digital knowledge and ICT
base
‒ # 19 / 20

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Agenda
1. Introduction
2. Brazil´s Digital Economy Landscape
3. Digital Transformation in the real world: Opportunities and Challenges
4. Conclusions and Perspectives
“Strategy, not technology,
drives digital transformation”
— MIT SLOAN school management review

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Crescendo framework: Transformation 3.0 covers an augmented transformation scope and
‘start-up era’ boosting methods
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Agile / Empathy /
Digital thinking
methodologies
Traditional
management
methodologies
Tactical / Specific
focus
Strategic / Broad
Scope
Change
Management
(1.0)
Classical
Transformation
Management
(2.0)
Transformation 3.0
Static; From A to B
Limited; Mono-channel
Auxiliary soft skill
Project Management focus
Dynamic, Continuous
Transversality
Multi-year
Multi-channel
Hard + soft skills
Program Management
focus
Phygital (Physical + digital)
Cross value chain
Accelerated / Start-up beat
Design Thinking /
Co-creation / prototyping
Leadership 3.0
Augmented
Transformation focus
Transformation Office

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Digital is one the 5 ‘transformation pillars’ that sustain Transformation 3.0
1. Estratégia & Business
Development
Organization
Organizational architecture
Operational governance
Post-merger integration
Participative transformation of
organizations
Restructuring
Process &
Performance
Strategic steering
Purchasing Performance
Optimization
Business process design
and effectiveness
Crisis management /
Turnaround support
Corporate & Business strategy
process design & facilitation
Competitive intelligence
Go-To-Market strategy
New businesses / strategic
alliances
Internationalization strategy
Strategy Culture
Shared Vision
Cultural Transformation
Intercultural alignment
Collective intelligence
processes
Innovation culture
“Tropicalization” processes
Collective efficiency
Leadership development
Digital
Digital strategy and venturing
Digital Innovation Sprints
From startup to scale-up
Startups-Corporations
partnerships
Makers Transformation

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Opportunity 1: human centered approaches are well adapted to Brazilian culture
Some human centered methodologies:
◻ Design Thinking
◻ Hackathons / Innovation Sprints
◻ Lean Startup
◻ Makers Transformation
◻ UX and UI design

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Opportunity/Challenge: When well combined and orchestrated within a shared digital
transformation project, Brazilian and European cultures tend to form a very fruitful blend
• Optimism / Energy
• Creativity
• Passion for Progress
+ • Rigor
• Method/organization
• Planning
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1. VISION
2. CULTURE
3. EFFICIENCY
4. PLEASURE
INTERCULTURAL ALIGNMENT ‘VCEP’

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Some Learnings from Digital Transformation Projects in Brazil
◻ The combination of various approaches to digital transformation often yields better results
‒ Hard + soft
‒ Top-down + Bottom-up
◻ Digital transformation has to be rigorously managed with a robust governance
‒ Direct sponsorship of the CEO, because the transformation is a Company-wide project, not a Department project;
Steering Committee = Board
‒ An internal 'Transformation Office' led by a sponsor (“CTO/CDO”) to provide a cross-cutting vision and ensure the adequate
pace of transformation
‒ Foster digital community / Leverage Millenials team mixed with senior executives
◻ Digital transformation only makes sense if done through people
‒ 'The fear of the digital' is often one of the main cause of resistance
‒ Importance of a genuine and neutral listening process of employees
‒ Importance of developing Leaders 3.0 to embrace digital transformation

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Agenda
1. Introduction
2. Brazil´s Digital Economy Landscape
3. Digital Transformation in the real world: Opportunities and Challenges
4. Conclusions and Perspectives

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Leading Digital Transformation – 10/16/2017 – ESCP Europe
Overall Conclusion: digital transformation is one of the two key societal transformations for a
sustainable future in Brazil
◻ Ethical, Institutional and Political Transformation => Lava Jato Operation and State Institutional Reforms
⬜ To modify in depth the relation between the State and the major private groups: to go beyond the so-called model of
“croony capitalism" / “state capitalism" (see Sergio Lazarini – strategy professor @Insper)
⬜ Reforms of the Political Parties funding and the Structure of the Political System
◻ Entrepreneurial and economic transformation => digital transformation & Startups entrepreneurship
⬜ Treatment of real pains of the consumer and/or Brazilian citizen by effective, transparent and measurable solutions
⬜ To increase the level of productivity and competitiveness of the Brazilian economy, which has stagnated since the 1980s
⬜ Increased international opening to technologies and new business models
ORDEM
PROGRESSO

20. fred@crescendo-consult.com.br
Tel: +55 11 3521 7322 / +55 11 98346 3060
leading Digital Transformation in Brazil10/16/2017