Shift podcast | Season 2

Jon: Hi, Welcome to Shift. It's PwC Canada's Podcast series and we're digging into key digital trends and topics that can make your business transformation a reality. I'm your host John Finkelstein and I'm also the creative director of PwC Canada. Here we are at House, at the Brand Stars event. I'm here with Claudette McGowan, Chief Information Officer, Enterprise Technology Employee Experience, at BMO And just like Uwe, I plucked you from the cocktail reception

Claudette: You certainly did.

Jon: Actually post, post award. First of all, congratulations--

Claudette: Thank you.

Jon: On being a Brand Star.

Claudette: Thank you very much.

Jon: Are you surprised?

Claudette: I'm very surprised 'cause I am used to being in the four walls of the bank and just really like churning out solutions and delivering for, you know, 45,000 people. So, I don't know how they found me, but I'm honored that they did.

Jon: But you're a Brand Star.

Claudette: Yeah, yeah

Jon: Right, less about marketing star, advertising star.

Claudette: Yes, yes.

Jon: This is about championing brands.

Claudette: Yes.

Jon: And creating amazing experiences for people

Claudette: Yeah.

Jon: Inside and outside the bank.

Claudette: Yes.

Jon: So, I'm curious. What project are you particularly proud of this year?

Claudette: The project I'm most proud of is our urban campus. So, we're building a 400,000 square foot facility.

It's gonna be at the Eaton center. So, you know, landmark-marky kind of location.

Jon: Right next to the Sparrow.

Claudette: It's gonna be above the Nordstrom so very key place for us that like to shop. And it's really about creating digital solutions for our customers. So, it's not open yet, but we're doing a lot of the work to get it ready for the big reveal.

Jon: That's really cool.

Claudette: Yes.

Jon: Can you tell me a little bit more about it? Like, what are people going to do there?

It sounds really cool!

Claudette: Yeah, yeah, So, if you think about our 12 million customers, they want to, you know, get things fast, they want to make sure that, you know, their dreams, their aspirations are being realized through the products that we bring to bear and we're going to have teams that put things together, leveraging AI, leveraging robotics. And like, here's a bank coming up with quick solutions with things that are going to help them hit the mark and help them really achieve their dreams and aspirations.

Jon: I love that! First of all, it's really cool, and quite unexpected for an FS.

Claudette: Yes, yeah.

Jon: Right?

A 202 years old FS. I mean, think about that if you're listening. You know, I love talking with clients such as yourself who work in very large organizations and a lot of clients or organizations think they can't change because they're so big!

Claudette: Yeah, yes.

Jon: Or they have a legacy or, you know, 200 years of doing it the same old way. I love that, so that really is a good reason that you're a Brand Star. A shinning star in that, so congrats on that.

Claudette: Thank you.

Jon: So, was it hard to push an agenda like that?

Claudette: I think a lot of it came from our senior leadership. Our CEO is, I would say, a visionary and he saw, like, the future, where things were going, and that you cannot, you know, do the same things that you used to do and expect different results. And so, I think, you know, setting the tone. Definition of insanity, yes.

Jon: That's where I'm going.

Claudette: And no one's insane, and really kind of galvanized the team, and rallied behind, you know, what do you envision for the future? Who are we building for, Are we building for ourselves, are we building for Gen Z, Alpha, Beyond? And I think we're really building for the future.

Jon: I love that.

Claudette: Yeah.

Jon: I hope people really take that to heart, because, you know, especially when the thing that you said. We're not building for ourselves, 'cause to think a lot of organizations tend to do that.

Claudette: Yes.

Jon: They build what they think people want, but you're going where the people are, and delivering stuff that they want which is amazing.

Claudette: And co-creating, I think that's big. I think to get the voice of the customer involved in what you're doing so that, it's not a big ta-da, five, 10 months later. It's, hey, we built this together, we took an iterative approach, and now we can love what we built together.

Jon: I have to high-five you right now.

Claudette: Yeah all right, awesome!

Jon: Because that, I love that. It's so good.

Claudette: Yes.

Jon: And that's a big thing that you know, at PwC, there we're, y'know, human-centered designer co-creation is fundamental to what we do so it's so great to hear you doing that. But that leads me to my next question. How do you foster a culture of innovation and creativity?

Claudette: Yeah, yeah.

Jon: Especially in a big bank.

Claudette: Yeah, it's tapping into the hearts and minds of the humans. That's really what it's all about. And much like we build with the customers, we build with the employees. And you hear a lot about customer journeys, we're doing a lot about employee journeys. Because if you've got really engaged, motivated, you know, valued employees, they will go to the end of the earth to deliver for the customers. So I think we recognize that you have to do things with purpose, you have to do it with intent, and you have to do it together.

Jon: So, do you have any advice or tips for listeners who really want to create a compelling or awesome customer or employee experience?

Claudette: Yeah, I have a couple of things I, you know, if you listen to anything I say, is "Wow she said that again!" But I always tell people, when find the weakness, and be the strength. Most people see a fire and they run away from it. But you need someone to towards the fire, you need them to put it out, and then to examine and say, "Well, why did the fire happen in the first place, and how do we prevent it?" So I think that's really big around, you know, doing the big, hairy, audacious things that most people don't do. And the other thing is, recognize for where we are today, there's a lot of reasons why things are not perfect. But I'm really focused on the present and the future. And I always ask people, "Do you wanna be a prisoner of the past? or a pioneer of the future?" And I'd love everyone to be a pioneer of the future.

Jon: We're here with CEO of Ecobee, Stuart Lombard.

Stuart, you're an honoree at the AdWeek's Brand Stars, congratulations. Were you surprised?

Stuart: I was a bit surprised. You know, it was awesome to be mentioned and to be honored obviously in the company some awesome companies. And, you know, one of the reasons I was a bit surprised because we're a relatively small company. And so, to be a challenger brand, and to be recognized was awesome and kudos to the team for getting us there.

Jon: Do you think being a challenger brand allows you more latitude leeway to do things a bit differently than the front-runner?

Stuart: Yeah, absolutely. You know, we have a lot more things that we can do. We did a really fun thing for Earth Day, called heated discussions where we did a focus group when we brought in climate deniers and in the focus group room we raised the temperature and we created a bit of like a hurricane inside the room. Anyway, it was really fun. Just some really great outcomes, and, you know, the participants had fun, too. But it was really around, you know, generating awareness around climate change. But that was something where, you know, we didn't have to worry about, you know, we're going to upset advertisers or that kind of thing. And, you know, we had the ability to really say, like "Hey, we're a challenger brand. We stand for energy efficiency. We believe in climate change. And we believe in making the world a better place." So we can take some of those risks that maybe others can't take.

Jon: Well, here's a question about innovation. I'm just curious about, what is your stance on net new innovation versus taking things that exist and optimizing them or have new uses or whatever. And I'll give you an example, so Ecobee does a great job of integrating Alexa or weather data, or all these different things and bringing them together to create something new. I would say that's kind of taking existing and kind of, you know, putting it to new use. Versus, hey, we're gonna come out with a brand new way of doing X or Y. Thoughts?

Stuart: We're doing both, right? And I think innovation is really about integrative thinking more than anything else, right? And so, I think the people who are innovating are a lot of the time being able to like, see something in a field that's maybe totally unrelated and relating it back to what you're doing over here and creating a new product, or a new functionality, or a new way of doing things. So, a lot of innovation, I think, is around that. The other thing that we've done is we've opened up Ecobee Labs. And Ecobee Labs is really about creating dedicated time, space, and resources to just work on problems, right? And I think, you know, as a product company, often you're on a product release timeline, right? So you're trying to get this out for that quarter, y'know we need to get this out for the holiday shopping season as an example, right? It's very hard to do that when you are inserting risk into the problem, right? So if you have something or an idea that you want to test out, it's very hard to do it in the context of a product road map because, when you run close on time you're going to go, 'kay, cut that because we don't have time to continue to experiment. And so, creating a lab really allows you you know, to test and explore things and it's also very engaging for your employees, right? So you'll find employees will have something that they're really interested in. So, radar, for example, is something we're looking at right now. Employees are very exited about it, and so you can say to a group of employees, "Okay, you've got three months to go explore radar." Right, And maybe you come back with something and maybe you don't. But it's time bound, but you get to go work on a project that you really like and that I think is incredibly engaging for employees.

Jon: What will they do with radar?

Stuart: Ah, I can't tell you

Jon: Okay 'cause I was immediately going to Fuzzbuster. Just showing my age here for a sec. Awesome. Where'd the name come from?

Stuart: Oh, it's part of a long focus group at the very beginning, when we started the business. So, when we started business, there were, like, three engineers and my sister said like, "Three engineers, you guys need to do some branding." And so we did focus groups and I remember we were explaining the concept to people and, you know, sitting behind the two-way glass, people aren't getting it. I'm like pulling my hair out, and like, anyway. Out of that came the name Ecobee and it's really, I think, about a few things. One is obviously we have an environmental positioning to our product. We're really trying to help people reduce their environmental footprint. But bees are also social animals. They help each other out, they live in hives, they actually air condition their hives. And so, there are lots of reasons why y'know, bees work well with what we're trying to accomplish.

Jon: Yeah, that packet, it's just a great brand.

Stuart: Thanks.

Jon: I grabbed Uwe Stueckmann, who is SVP Marketing at Loblaw. I plucked him from the cocktail party to chat with us. So, thank you so much for doing this. But congratulations on being named a Brand Star.

Uwe: Thank you, thank you very much.

Jon: We have a couple of questions here, and the one that I'm most interested in actually, for me, is, how do you find at Loblaw your fostering a culture of innovation?

Uwe: I think I'm blessed with the portfolio of fantastic brands that we have at Loblaw. As Stewards of those brands, we work hard to try and find new and constantly innovative ways to bring those brands to market. It really is in the DNA in our company. Innovation is in the DNA of our company. We're 100 years old, President's Choice, has been a relentless innovator in food and marketing innovation goes back to the roots of President's Choice. So, it is a bit the way we do business

Jon: Mhm.

Uwe: And then in marketing specifically, it is really believing in an agile culture believing in empowerment, and having a great team that does great work.

Jon: I love that because via empowering people to feel like they have a role in innovation, so important.

Uwe: Yeah.

Jon: You know, when they feel like they can't, or it's not operationalized or whatever and they feel like, oh, you know, I have a great idea but I'm afraid tell people about it. What if I get fired? That would be bad. So, I love to hear that. Speaking out innovation for a second, love to hear your thoughts on how you think innovation and exceptional customer experience, how do they intertwine or intersect?

Uwe: Well, retail is all about customer experience. It's all about a real physical customer experience. And one of the things we have to make sure in our marketing innovation is that our brand messaging and our brand stays true to the customer experience. I think that's the biggest thing. We can't create a communications program that doesn't ring true when the consumer walks into the store. So making sure that the message rings true and that it's not only understood by the entire team in the store, but embraced and loved by the entire team in the store. So, for us, you know, at least half the work is to inspire our people, and the other half is to inspire customers.

Jon: I love it. What are you particularly proud of this year?

Uwe: Oh it's been a great year so far. It's early on still but it's been a great year. We're in year three of our Eat Together campaign which is really our attempt to create a movement to get Canadians to eat together and to make the country a better place by sharing a meal. And we have over a half a million Canadians have pledged to participate in our Eat Together program this year and have pledged to break bread on our Eat Together day which is coming up in June and share a meal. And then our No Frills campaign around haulers continues to break new ground. This year, we launched a video game with haulers and we've had over 300,000 people play this throw-back arcade video game and get some PC optimum points in the process. That's another example of sort of a different way to take a brand to market.

Jon: I thought that was really smart when I read about it actually. 'Cause, you know, back in the earlier days of digital, when brands were looking to do immersive experiences and get people to interact, they might have done a game.

Uwe: Yep

Jon: But there wasn't an actual reward. It might have been a perceived value of some kind, but to actually tie it into PC points, super smart. I have a personal question about Eat Together.

Uwe: Yep.

Jon: So, where did that idea come from? Was that born out of how you were raised, how its important to you? 'Cause it makes sense for me.

Uwe: It was born in the lead-up to Canada 150. And we thought about how, as proudly Canadian brand, we would celebrate this big anniversary for Canada. And what we didn't want to do, is the create some flag-waving moment. We wanted to make sure that what we do was as truly and authentically Canadian. And so an inclusive way of getting people together and to eat together around a table is, you know, the best sort of representation of this country's about. So that's really where that started. And it surprised us. We launched it as a film on New Years Eve, leading into the 150 and immediately got enormous pick-up online. I think, I don't know the exact number, but we're somewhere north of 150 million views of the collection of our Eating Together films that we've done. We're in year three now, so we've had, you know, a significant impact on having people think about the importance of eating together, and then actually doing it.

Jon: I think there are other cultures that do a much better job.

Uwe: Yeah.

Jon: Of being together.

Uwe: Yeah.

Jon: For me, even in all these, I've been in advertising for 27 years, and for the exception of when I was at Grip Limited for almost 10 years as a partner there. I joined shortly after the agency started. So, it was basically like working for a start-up. And I always think eating together with my family is so important, you know, to the point of, except for like maybe a couple years in there where I was like too damn busy. I'm just wondering, what is being named a Brand Star mean to you?

Uwe: You know, it's an amazing honor to be part of that group of individuals that are being recognized here today. It's a humbling experience, actually, to be. Y'know, At first I thought it was some kind of a joke.

Jon: Who is this?

Uwe: Who is this?

Did I win a cruise? What is happening? But it did feel sort of like, wow! And I'm humbled. To me, it's just my team that is actually being recognized and the work that my team's doing. I just happen to be the name on the trophy. But it's really the team that did the work.

Jon: So, thank you so much for spending this time with us. Again, congratulations to all the great work of Loblaw, on being a Brand Star, and I hope you have a fabulous evening.

Uwe: Awesome, well thanks for having me!

Jon: Thank you, thank you!

Uwe: Appreciate it.

Jon: Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/shift. If you enjoyed this episode and wanna hear more, subscribe to our podcast series. You can find us on iTunes, Google Play, or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers LLP, an Ontario-limited liability partnership for general guidance on matters of interest only, and does not constitute professional advice. Until next time.

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Jon: Hi, welcome to Shift. It’s PwC Canada’s podcast series and we’re digging in to key digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein and I’m also the creative director of PwC Canada.

Today we have a really exciting topic. We're talking about open banking and I'm here with Neil Parmenter, President and CEO of Canadian Bankers Association. Welcome.

Neil: Thank you. It's great to be here.

Jon: Why don't we start by talking about the Canadian Bankers Association, what you do, and what is open banking.

Neil: The Canadian Bankers Association is an advocacy group representing about 68 banks in Canada.

There's the big six banks that everyone is familiar with. There's smaller domestic banks. Then our biggest group is actually the foreign banks. All of the big foreign banks, you can think of all the American brands, a lot of the European banks, and increasingly more and more Asian banks.

Jon: We need a definition. Tell me the definition.

Neil: In its simplest form, open banking starts with a premise that consumers want their own data, in this case, banking data shared with a third party of their choosing. I use the analogy of a waiter. If you're at a restaurant, and you're given a menu with a whole series of selections that you can pick from, your conduit back to the kitchen to say what I want to eat is the waiter. 

You place your order with the waiter. The waiter goes back to the kitchen. and then that waiter, delivers it back to you. If you think about a world in which that waiter gets to know you more and more. This customer has a gluten allergy, they don’t like spicy foods,  those sorts of things. They can start to apply intelligence to your ordering decisions.

Imagine that waiter is now not representing a single restaurant's menu, but tens of thousands of restaurant menus, and coming to you with ideas about what might work for you.  If you use that analogy in banking, it works very much the same way.

The data that exists on you, as a customer, your saving accounts, your investing habits, the type of debt that you have, an API can apply intelligence to your financial situation and show you different options, or different alternatives, that you might want to consider with your banking. In a nutshell, that's what open banking is.

Jon: If I'm the average consumer, and I hear “Banking data shared with,” the alarm bells go off.

Neil: They do. If you think about the information that you share with the Googles, the Amazons, the Facebooks. At the end of the day, you're well aware that you are consciously sharing that information with those organizations, and they're likely mining that data, and analyzing it. It's one thing if it's photos of your family, or what your favorite movie is, but we know, and consumers tell us, that their banking information is very different.

If you think about a transition to an open banking environment, people want to know who's in charge of the security, who's setting the standards, who owns and who's safeguarding my privacy. And most importantly, if something goes wrong, who's liable for that? Is it the technology company that's providing this information or it, ultimately, my bank?

The number one quality they're looking for, from a service provider, over convenience, customer experience, all these pieces, is safety and security, and privacy.

Jon: What's the big advantage for people to move to more of a open banking system?

Neil: Open banking advocates always push the concept of competition and choice. You can get a weekly, or monthly, digest of how much you've spent eating out. Did you know that you spent $300 this month eating out? At a minimum, that's going to give you some data that you can internalize yourself and say, “Am I comfortable with that or does that seem too much?” But what it can also do is categorize how much you're spending out a month, how are you spending on paying down debt, how much are you investing for your retirement.

So, you can get a quick snapshot, in a very comfortable way.

Jon: You said the technological transformation is here to stay. We need to move to remove the last frictions between the physical and digital environments. What do you mean by that? This notion of removing the last frictions between digital and physical, especially as it pertains to banking? 

Neil: If you think about all of the trends you're seeing in other industries, and what consumers are expecting. They colour and influence what people expect out of banks. I always use the example of Uber. Uber, to me, is as much about the payment mechanism as it is the ride.

I don't have to think about it. I get in the car. When we arrive at the destination I open and I'm gone. You're seeing now with Amazon Go, retail stores where you walk in, you grab the items, you look at them, and you walk out. More, and more, people are going to expect that experience in all aspects of their life.

Jon: If I want to open up a new bank account, or something, I got to go into a branch. And I need to bring my passport, and my blood samples, and I need to fill out 50 pages of ...

Neil: You're touching on one of the key elements, one of the biggest challenges we have as an industry, is that the rules governing banks are under the auspices of the Bank Act. The challenge with the Bank Act is that it only even comes up for a review every five years.

The assumption is, of course, that it's going to be modernized every five years. Well, the challenge for the Bank Act is that it literally governs everything, soup to nuts, in banks. It's thousands, and thousands, of pages long. Even when the review is open, governments can't possibly update everything, so they tend to focus on a narrow slice.

The technology exists, the customer expectations exist, the will among members exist to move to new forms, but sometimes what holds us back are the rules.

If you and I had a Skype video chat, and I was your banker, and you said, “I want a mortgage for this amount and on these terms,” and I said, “I agree to that.” It's even all recorded. There's no legal value to that exchange. But, if I mail you an application, you fill it all out, you give me a photocopy of your driver's license, and you sign it with a pen, and mail it back to me. That meets the standard.

Customer expectations are evolving and if we're serious about building an innovation economy, we can't hold onto things like wet signatures with pens, and photocopies of driver's licenses.

Jon: One of my favorite expressions is latency is a killer. I think that applies to everything. We need to move at the speed of innovation.

Neil: Yes. Like many statutes, all well intentioned. Decades ago there was a recognition that the sheer size of the banking industry, relative to the Canadian economy, and their central importance to the economy, we need different sets of rules for banks. One of the biggest ones they set up was to say, “We want banks to be banks.” Meaning, I don't want banks to turn into holding companies. I don't want banks buying airlines, and telecommunication companies, and all those pieces.

It made sense, decades ago, but in all the stories we've been talking about today, what is Uber? Is Uber a transportation company? Is it a broker that finds riders and drivers? Is it a payment company? So the lines are increasingly blurred. And if you think about the role that banks will play in your experience as a consumer, when you're traveling on an airplane, when you're going to see a hockey game, when you're eating out. What we're asking of, and we were really encouraged and, frankly, got in the most recent Bank Act changes, was a recognition that there's a huge distinction between buying a telecommunications company and allowing banks to partner. That word, partner, was, frankly, problematic previously with technology companies. 

But in 2018, to me, where's the line? When the rules do change, we spend a lot of time trying to get government to not be too prescriptive.

Try to make those pieces as flexible and agile, as possible, because you have to allow for innovation to operate within those rules.

Jon: Yeah. That's a tough one, because you need to anticipate what's going to come, even though you don't know what it is.

Neil: Exactly.

Jon: Then we get into things like single sign on.

Neil: Yes.

Jon: Well, it's actually not even single sign on, it's single identity and this notion of it's a block chain. Who owns it? Do you want to talk a little bit about that?

Neil: Absolutely. Canada is in need of a digital identification system. We've, at the CBA, spent a lot of time researching different models.

We think about digital ID as an ecosystem. You don't, ultimately, want any one entity owning every Canadian's digital identification. But what you do want is an ability to have a system, where everyone can plug in, and everyone can help play a role in verifying. I should be able to apply for a mortgage, and be confident, the bank should be confident, that I am who I say I am. I should be confident that I'm dealing with institutions that are participating in an ecosystem that's going to protect my digital ID, and not share information beyond what's necessary for that transaction. That's really the system that we'd like to see.

Jon: I think the big gap is I don't think they know how to do it, and I could be wrong.

Neil: It's a big project, for sure.

Jon: Because it's really complicated-

Neil: It is.

Jon: To think about all the different components to that. Theoretically, or philosophically, it's a grand vision. I love it.

Neil: Yes.

Jon: What do you think is really getting in the way of it?

Neil: Like anything that's big and new, there's risk, so people want to take their time. We can't purport, and we don't, to say, "We have it all figured out. Here's exactly how it should look like," but what we are asking is that industries, like ours, energy, telecommunications firms, different levels of government, do need to sit around some tables and start talking about these issues. We're stifling innovation. And what I would hate to see is Canada become an importer of digital ID systems that get figured out elsewhere in the world.

We've got a great technology community. I would argue, admittedly biased, that we have the strongest banking system in the world. We have a government, today, that's committed to a digital economy and innovation. We have the component parts. We have people. We have technology. We have capability. And we have will. And we've got a great Fintech community that I see playing a huge role in that. Let's bring these people together. Let's get some of these great minds working on these issues. And let's build this.

The issues that we've been talking about today are all centered around cyber security, privacy, customer data, who has rights, what's possible and innovation. To me, a digital ID system is absolutely central to addressing all of these issues. And if we get it right, you're going to see, I believe, incredible innovation in all those areas.

Jon: Cyber security, fraud, all these things, are top of mind I think it's really important to be risk averse.

But I really think that it needs to be balanced with the opportunity, the vision, the benefit.

Neil: Ultimately I'd argue an enormous risk that doesn't get talked about, which is ... latency. If we sit on the sidelines and wait for someone to solve this issue, we're going to be left behind. 

There’s all this discussion all the time about technology is disruptors and are they coming in to eat the bank's lunch, and what's going to ... Honestly, I can tell you, those are things I don't worry about and, certainly, my board doesn't worry about. I think the key to this whole issue is that in decades past we always looked for others to solve these big issues.

I would love it  if Fintech got to know banks better. If banks got to know Fintech better, if we collaborated.  There's a place for all these groups to play. And if we get it right, it's, I think, a huge opportunity for Canada.

Jon: Who in the world is doing it well?

Neil: It's very early, so it's hard to say. I'd say in Australia and the UK, you've had more of a government setting the rules, and here's how this is going to work. June 2018 was the start of the banks and Fintech playing this space. They’ve had, some stumbles, which they would admit. Because some of these bigger issues about privacy, liability, and cyber weren't as clear as, perhaps, they should be. In China and the United States, you have very limited, but more market driven open banking experiments.

What I believe, for Canada, I think that the work's already started in terms of how finance is going to start their consultation process. I think that they're going to learn from these other jurisdictions in a very Canadian way and take the best from all.

You do want to get it right. If you had a cyber issue, a privacy issue, that would ultimately kill the innovation. At the end of the day, what banking really is, and what consumers tell us they want is confidence.

Jon: Yeah.

Neil: If anything erodes that confidence, you've got a big problem because consumers are losing faith in the system. That's a risk we can't afford.

Jon: It's pretty interesting. When Facebook allowed you to transfer money between people and it's like, "Wow." What if Facebook became a bank? There's no certainly at how any of this is going to go down.

Neil: The only certainty is that change is going to continue, and the pace of change is going to intensify. For all the reasons we're talking about, you have two options. You talk about sitting on the sidelines and not making investments and not having the tough conversations. That's one option. Or you embrace the disruption as a positive constructive disruption. And who wins? Ultimately, consumers win, because they get greater choice. 

Banks and industry win, because they continue to have a seat at the table and  they're serving customers well. And, ultimately, Canada wins, because I believe those are capabilities, technologies, and business models that can be exported around the world.

Jon: I love that. I mean, especially, when we think about the holistic experience, the consumer experience. Banks are consumers too, and end users are consumers too, and we're trying to create this frictionless thing, which I think makes a lot of sense. There's a push and a pull between our desire for technology enabled interactions and the personal touch.

Neil: There is. "Do you want mobile banking or do you want in branch banking?" The answer is, "Yes." The truth is, new channels are additive. They don't replace. They want an ability to talk to a person.

Bank branches are evolving. They look more, and more, sometimes like cafés. There's a kiosk which is just a few iPads and some chairs. At the end of the day, that is a branch.

Jon: Sure.

Neil: And I think you're going to see that continue to evolve. I think you'll see the physical footprint of banks continue to change and evolve to be more conducive to the enabling conversations. And trying to get people, frankly, more comfortable.

Important to that, in the customer experience, is creating an environment that doesn't feel confrontational. Some of that is technology enabled. And some of it is person-to-person.

All these pieces, are aimed at providing greater certainty and assurance. That's what people are looking for. What they often look for, in a physical location, is I want to be able to go somewhere in the event that something goes wrong. Sometimes it's easier to do that face-to-face.

Jon: You think about Canada, it's a very big country. It's sparsely populated. I mean, you get past whatever the latitude is and suddenly it's just rocks and trees. Then you go farther and there's people. 

Talk to me a little bit about how open banking can be more inclusive and really allow people across the country to enjoy the same banking possibilities.

Neil: What digital ID, in particular, offers and affords people, both from a government services perspective, but just as much from a banking services perspective. It eliminates that need to go to a physical center somewhere and bring in identification, apply for loans. You can deliver services. You can update things like driver's licenses, or other government ID remotely, and you can use that to apply for banking products, and allow people to both, apply for products and pay for goods and services remotely.

Again, if you think about the geographic challenges we have, particularly in remote communities, particularly in the far north. From a learning perspective, from a digital commerce perspective, I think there's huge opportunity and banking, obviously, is central to much of that.

Jon: As the nature of banking changes, becomes more innovative, or technology enabled, what does that mean for employees? How do we upskill them? How do we train them?

Neil: I think employees are one of the most critical issues in banking that don't get talked about enough. The reason is our industry employs almost 300,000 Canadians in a variety of roles, but, generally, well-paying great jobs. The truth is there's always going to be a need for people in a variety of roles. The specific demands and skillsets required are going to change.

If you think about potentials for artificial intelligence to change the way risk is calculated and adjudicated. You fill out an application for a loan, whether it's small business or personal, you could envision a place where a lot of that does get actually automated. But what kinds of other advice does a small business owner need? How can you help guide that small business or the entrepreneur to grow their business, provide them with a range of alternatives to finance that, to continue to export? Those are potentials on the business side for where I think you're going to see some new skillsets emerge.

The industry will always remain one of Canada's largest employers, just the composition and the nature of that work is going to evolve.

Jon: I love the idea of taking a workforce that's, basically, doing what's tantamount to manual labor. It's very service oriented. This for that, deposit this, stamp that, and really turning that into a much more valuable advice-driven consumer experience that's worth something. 

Neil: Exactly.

Jon: Because, I mean, I love the fact that I don't have to go to the branch anymore, or to an ATM to deposit a check.

Neil: Right. I think the pessimists among us view all these big macro trends, as well. You're moving to a cashierless society, a tellerless ... It's all bad for employment. It's all bad for Canadians. And I just don't subscribe to any of that.

Jon: That's the negativity bias.

Neil: What it does do is evolve the nature of work and, I think, will, for many people, remove some of the more tedious elements of that work, and provide them with opportunities with retraining. And I think the banks are already doing it.

Jon: Let's talk about this notion of retraining. When we think about digital ID, when we think about open banking, and the nature of work is going to change. The nature of skills need to change also.

Neil: Absolutely. I think we do have a tendency, when we're talking about a digital economy and innovation, we have a tendency to go to the technology folks, naturally. But the truth is, and something that doesn't get talked about nearly enough, there's huge opportunity for arts, social science, and creative arts, as well.

Core to this, functionality matters, security matters, undeniably, but customer experience matters, at least as much, if not more, and design is a big piece of that. User experience is a big piece of that. Again, if you think about some of the colleges and universities we have, Canada is a leader in that space. That's a story that doesn't get told enough. Certainly, when we talk to government and they're looking for digital innovation, they often tend to go to the coders and programmers. They're surprised to see just how many graphic artists places like banks, employ.

If you think about all the issues we're talking about, retraining, customer experience, providing career pathing for people. Those are important critical roles that banks need. If you think about a big six bank in Canada is employing fifty to sixty thousand Canadians. That's a lot of retraining. That's a lot of org design that's required.

I view all of the change, all of the disruption, that we're experiencing as positive and creative disruption. I think it's good for the industry and, certainly, good for the country.

Jon: Difficult is worth doing. I love that phrase, because you can't shy away from the important work that's hard to do, just because it's hard.

Neil: Agreed.

Jon: Or just because you don't know how to do it. I think that's, probably, a lesson for everybody. It doesn't matter what sector you're in, or what industry you're in, if you can see the vision, and you don't know how to get there, that's okay.

Neil: Yes. I am certainly incredibly confident and incredibly positive about what Canada is going to do. I think we have all the pieces and the will is there. You can see that the ball started rolling down. I think it's a great thing for Canada. I also believe that success breeds success. If we can build a bit of a track record of delivering these things, you're going to open people's minds as to what's possible. 

Jon: This has been an absolutely eye opening, ear opening, brain opening, open banking conversation. Neil, thank you so much for spending the time with us. It's such an exciting topic and area, because it impacts every part of our lives. The innovation around it, I can't wait to see what happens next, honestly.

Neil: Well, thank you. Thanks for having me. I know I've enjoyed it thoroughly.

Jon: Thanks for listening to this episode of Shift. You can get more details at pwc.com/ca/shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on iTunes, GooglePlay, or your preferred podcast platform. Just so you know, this podcast has been prepared by PriceWaterhouseCoopers LLP an Ontario limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

• R-Labs Canada Inc.: The future of proptech 
• TELUS: Using privacy to build customer trust 
• PCL Construction: Thinking big to drive enterprise-scale transformation (Innovation series)

Jon: Hi. Welcome to Shift, PwC Canada’s podcast on digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein, and I’m also the creative director of PwC Canada

We have a really interesting one today on proptech, and I'm here with George Carras, founder and CEO of R-Labs Canada Inc.

So for those of you who've been listening, we talk a lot about emerging technology and internet of things. The notion of proptech, I think might be a bit of a strange one, a new one for people.

We hear a lot about FinTech, proptech? Tell us a little bit about what proptech means, and what it means for you in particular over at R-Labs?

George: It's a word like FinTech which describes property and technology.I think it's really a buzz word in 2018, and made an emerging trends in real estate six times actually, which is a pretty big deal.

Jon: So how do you want people to think about it? I mean, if this is a new term for them, what do you guys doing over at R-Labs that's helping push the proptech agenda?

George: So, we've got a fairly different approach in this thing. We own the problem of housing and commercial real estate, and we chose to solve it not through traditional means, new era, new thinking.

Not through government policy, but through tech-enabled venture. There was a great quote from Astro Teller who runs X at Alphabet. Captain of Moonshots, I think is actually his proper title.

Jon: I love that title.

George: It's fantastic, right? Astro's line was very transformative for the lab and it was, "Don't fall in love with a technology, because there's going to be a new one tomorrow. Don't fall in love with the solution, fall in love with problem."

Jon: I love that because one of the things that we like to do here is really trying to figure out what problems are worth solving? How do you prioritize the problems that are going to have the most impact?

George: The key is to really define the problem. I think a lot of times and typically in venture, 95% of it is, "Look, I've got this cool technology and we'll put some money into it until we get this product market fit," which basically means you have a solution looking for a problem.

We have an affordable housing problem that's there, and a whole bunch of others that are actually going to be growing as well through partnerships or things like REALPAC and other industry associations.

Jon: That's really interesting. I'm curious about how can technology solve affordable housing?

George: I think what will be interesting about proptech is that when we think of technologies, we drifted digital technology.

Jon: Yeah, it's true.

George: So, we actually have two different ventures that are in the form of a housing problem attacking from two different ways. One is a very physical solution, which actually makes housing products off-site constructed and installed, and it allows the market to self-solve its housing need. So we actually have a product in the second venture that allows owners of those properties to buy it. They can configure it, and it's very physical. So, physical solution to allow a market to self-solve its needs.

You're seeing new methods and new physical technologies and materials that are allowing that to make a big difference. So, you can attack going back to the problem of affordable housing. Don't limit, or at least in Canada, we're not limiting the thinking of what is proptech to digital technologies. We're also introducing physical.

Notwithstanding that, digital technologies also allow you to solve that housing problem from a business model perspective. I think that Jon is where the real game changers occur here. It's not just a cool technology. It's when you marry that technology with a new business model that you can really make a difference.

Jon: I just want to go back about one of the things that you said which I think is really, really interesting especially for people who are listening, who are in positions of disruption and figuring out how to take technology and make a difference with it. Not falling in love with a technology because-

George: Right. So easy.

Jon: Our side of the business, it's so easy. We have clients coming to us asking for a thing. "Hey, we need this implementation." "Oh, can you solve this problem using this technology?" Quite often it's like, "That may not be the tech that you need anyway." So, I really encourage people who are listening to say, "Don't worry about the tech right now. Solve the problem first, and then figure out what tech you need."

George: You need to bring new thinking to that problem. So if you try to have the same people who created the problem sit down and try to solve the problem and just say, "Here's some technology." It may be and you may have some incremental solutions, but you really need to bring new thinking around that problem. That's kind of why the lab, R-Labs by the way. It's kind of cool that little R exponential logo, but when you close your eyes and hear it, it's our labs-

Jon: OUR-Labs, yeah.

George: ...as in O-U-R. It's about the community. So, you can behave in a different way in a lab than you can in a larger organization. Innovation in a larger organization is really, really, really hard to do, and the biggest barrier of that is fear.

Jon: It's harder to solve new problems with old thinking. I think anybody who's listening, anybody who's working in an organization knows that. I think the hard part is actually getting out from under your own history, if you will.

What advice would you have for larger organizations who are listening that know they need to innovate? Maybe they know what problems they need to solve but they just don't know how to fail

George: It's mindsetting culture. In the lab, we have two outcomes. It's either winning or learning.

Jon: Winning or learning?

George: Yup.

Jon: I love that. Winning or learning because so many people are like, "Well, you know, we don't have a culture of failure. Failure is a bad word. We're afraid of failure." It's not failure anymore guys, it's-

George: Learning.

Jon: ...learning and winning. Winning and learning.

George: It's the lab. Welcome to the lab.

Jon: Winning and learning, I really like that.

So this is the big quote, "5.2 billion dollars in growth annually, 2018 proptech." Why do you think there's a surge in property technology investments? What are people thinking about?

George: I think it's ready for it now. Real estate as an asset class, its business model is pretty traditional.

You contrast that to other sectors. R&D, I don't mean exactly as a property, but R&D investments in the construction space are 0.5% of revenue. R&D in the computer electronic space are 9% of revenue. What you've seen is a cumulative lag in innovation in real estates. So you would say, real estate is operating in a World 1.0 operating system.

Jon: Yeah.

George: When the world is clearly at World 3.0. So, it's behind by at least two upgrades and that's now evident in two ways. One is, the technologies that are now far more mature, and capable, and more abundant are present. The capital that surrounds those technologies is paying attention to industries that are still lagging for real disrupting opportunity. So I think you're seeing the combination of both those forces saying, "Great, we're going to put some capital to work to fix things or disrupt things that are in this massive asset class of real estate."

Jon: One of the things that we see is consumer need sometimes drives innovation. Do you see people asking for or demanding innovation in real estate because there's so much more innovation elsewhere.

George: I would go back to these problems. People will be very vocal, political, in arms around things like housing, So people are concerned about that problem, but they're looking to ... the tools of yesterday that quite frankly created that problem, for the solution for that. So everyone's anchored in that problem. They're not necessarily looking to technology to solve that but a few will be, and those are going to be your entrepreneurs and the venture capitalists that are prepared to get behind it.

So you got to get ahead of this thing, and I think the need will drive the innovation. Housing and built environment, which is the anchor is the “prop” of proptech has a lot of need. We're going to have to think very differently about how we solve it than how we've created these things in the first place.

Jon: It almost seems insurmountable when you think about all the current infrastructure.

George: Yes, but I think that's where you'll have to then look at it and say it is, if you embrace the way we thought of solving it up until now. You need new thinking, and you need that new thinking to come with new capabilities, and those capabilities are being brought forward exponentially with these technologies both digital and physical.

Jon: The people who are going to solve these problems, where are they coming from?

George: I think the superheroes, they're amongst us right now.

I think there's a number of I'll call it entrepreneurs and institutional industry leaders that have come together and said, "We're going to think differently here." We're attracting the emerging leaders, the next gen leaders that have platforms that will support them in defining their super strengths and putting those superheroes around the problem sets that we have in lab.

Jon: You're talking about, I think X earlier.

George: Yup.

Jon: I love the whole premise that they have which is basically, "Come to work every day and try to kill your idea."

George: Different thinking, right?

Jon: Why won't it work and try to do that?

George: Celebrate when you do.

Jon: Yeah. Celebrate when you figured. I think that's really interesting. "Hey, they kill their idea today." This wasn't going to work, because I mean there's that old adage, "Don't hold on to your mistakes because you spent a lot of time making them."

George: Right. Exactly. That's the challenge sometimes. You get into that and it's your mindset. You let go. That's a learning. Move on.

Jon: You mentioned this earlier, but real estate as an industry is probably viewed as somewhat slow, I suppose? Why do you think that is?

George: It's an interesting business. Even on the development side, one of the only businesses that rewards you for failure. So, if you could imagine holding an asset that all you have to do is hold that asset for a period of time, and even if you missed your approvals on a piece of land, your value of your asset kind of went up. There hasn't been a real need to operate differently because you've kind of made a good business or decent business operating within the paradigm of the day.

Jon: it's really, really hard to change when things are good.

So one of the things I think is really interesting about proptech is you talked about, yes, there is technology. There's physical innovations, all kinds of different ... There's business models. There's all kinds of stuff.

George: You know what? You just nailed it. I have to try me on this because it's so appropriate. I'm actually George 3.0.

Jon: You're George 3.0?

George: Yeah.

Jon: I love it.

George: So, let's pretend we have a unique ability, which I think is your superpower. Everyone has that in them. The key is how to find that in the earliest possible age you can. Then all you become is figure out your versioning system. What version of Jon or George are you, and what would you describe the next version? The simple thing on that is, you just got to get to that better version of you. Not somebody else, you.

Jon: Right.

George: So, I think that's bang on. I think that the challenge you have is clarity. For a 20-something year-old clarity of what do I do? I don't know, because what do you know? I think the better question in the beginning is, what are you really good at? What do you love? Start with that.

We actually have a program of that in the lab in helping develop real estate entrepreneurs, innovators, and managers working with PwC in the Next Gen program. I think that's important because the earlier you can help create the superheroes, the more traction we'll get on solving problems.

Jon: I think people sometimes they know what their unique abilities are, but they don't focus on them because A: It's more difficult. B: Maybe they're not going to make as much money right away.

George: There's always the concept of the side hustle. Familiar with that? So if you talk to someone of that in their 20s or 30s and you say, "So what do you do?" They say, "Well, I do such and such, and so and so, but me and my three pals have a side hustle and we do this." I encourage them to pay a lot of attention to that because you have to do your day job, but you chose to do the side hustle.

If you love what you're doing and you're good at it, and the world will reward you for doing it like, "Why are you doing anything else?"

Jon: Exactly.

Are you seeing startup technologies, are they having an impact in non-real estate organizations? Are you seeing them helping? What are you seeing out there because you must be seeing a lot of really interesting tech?

George: There are probably a dozen technologies now that I would characterize as being in the knee of their exponential curve, that S curve. You've got this ramp up, and then rapid growth, and then the decay. Machine learning, AI, IoT, blockchain I think. So all of these come together individually, but actually work highly integratable, if we can explain it that way.

Although they're really powerful and they're coming as solutions looking for a problem, the real game changing opportunity is when you can apply a new business model on top of those and attack a problem that exists in the environment.

So we have this massive force of these technologies that are coming where? The built environment. How much of your life do you spend in the built environment, right?

Jon: 99.9%.

George: Right. So, these technologies are coming. There's no ignoring them. The only thing you can pick is what role are you going to play in them. The challenge to that in the rate of growth in those technologies has really left the rear flank if you will, vulnerable. So you have this tremendous risk now on security, and it's evidenced everywhere. It's not just by little organizations, you're seeing it evidenced in big organizations. So the level of disruption I would say from those technologies is profound both on innovation and risk. It is hitting. Those are hitting real estate, but it's not just the technologies, it's how we apply new business models to that.

I think there's a profound force that's coming from these technologies, I would say both in the business and definitely on the business of real estate.

Jon: Thinking ahead, how should real estate business owners be modifying their thinking, their strategies to be ready for change? Let's go. Three predictions you have for the future of the sector.

George: I think I'm going to know that whatever I say now, history will make me look like a fool. I will borrow some really good insight from-

Jon: What would George 4.0 say?

George: Yeah, looking back now. I think he would have said think of what Jeff Bezos said in your answer to this question and what Jeff said was profound. He said, "Forget about what technology is going to change. Think about what's not going to change and go all in on that." So what I would say is that 30 years from now, if we froze you and woke you up 30 years from now.

And we put you in the city. The built environment subject to impact from climate change would physically be here. If you're lucky enough to be alive 30 years from now, you will be 30 years older. Those are things that we know will be true. So, you invest all in on that. So, how does an organization evolve on that?

From a real estate perspective, your culture, your talent, all that is how you're going to deal with innovation, really how you're planning on dealing with failure. Predicting what does the future look like, I think the physical buildings will be here and pretty much the same way you see them now. Everything else about how you're running them, how we invest in them, and quite frankly how we're using them will be very different. I think in terms of the typical silos as we see them now.

The real estate over the last 20 years has done this great job of creating silos. You're in the office sector. You're in the retail sector. You're in the industrial sector. You're in the housing sector. So, we've done a great job and then what we've done even more is institutionalized each of those sectors. It means pour lots of money, and rigor, and discipline, and governance around that. I think change now is saying instead of creating a pen and creating silos, it's take out your eraser and blur them out. The assets will still be there, and we're stuck with that built form. How we use them is going to be very different.

Jon: Bad analogy probably is how they take ... I don't know if even this makes sense but you think about some of the factories whether you see the old Sears building or the Candy Lofts and how they've-

George: Yeah.

Jon: The outside is the same.

George: The adaptive reuse of the structure is just kind of the mold. Up until now, those have been resisted because of zoning and physical layout. So, what's interesting with this is some of those challenges are just amazing raw materials for great creativity.

Jon: Yeah. We just have to get out of our own way on some of the stuff.

Who's leading the charge globally on proptech?

George: R-Labs absolutely has the Canadian DNA on this. It's happening everywhere in different stages. Lead, follow, get out of the way, and I think we'll probably do all three. But I think we don't necessarily have to adopt a definition of that, that's coming from another place. I think we can create our own ventures and initiatives that will ultimately help shape what does that word mean.

I think the community that we have here is really unique. It's sophisticated. It's mature. It's big, and it has I think some great potential to collaborate in the R-setting around the problems that we face.

Jon: I love the fact that smart people are thinking about these difficult problems. It gives me a little bit of confidence in our future

I love the conversion of digital technology with physical innovation I guess, along with new ways of thinking new business models and really making sure that you just don't have a technology looking for a problem. I love what you said at R-Labs, you own the problem. I think that's such an important thing for anybody who's listening. You have to think about the problem you're solving. How to solve it for people and then figure out what you need to do.

George: A technology-enabled venture is a very effective way to get something to happen.

I think having a community to mobilize around this; here and now, I'm quite excited about.

Jon: You should be, I am too.

So, wow, that wraps another episode of Shift. In typical fashion, my mind has kind of exploded. Well, a lot actually. I'm hoping that people who are listening got a lot out of this, especially when we think about really being on the forefront of something that's so exciting and so transformative. You guys at R-Labs are really at the cusp of this which is awesome. So, thank you so much George for spending time with us, giving us your thoughts, your prognostications. We'll come back to you in 30 years and see whether or not your predictions are right, but until then thank you again, and thanks everybody for listening.

Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/Shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on Google Play, iTunes or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers, LLP, an Ontario Limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

• Canadian Bankers Association: Digital transformation of banking in Canada 
• PCL Construction: Thinking big to drive enterprise-scale transformation (Innovation series)

Jon: Hi. Welcome to Shift, PwC Canada’s podcast series, and we’re digging into key digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein, and I’m also the Creative Director of PwC Canada. Today we're talking about a very hot topic, and that is privacy, data, and trust when it comes to customer experience.

My special guest today is Pamela Snively, Chief Data & Trust officer at TELUS. I'll tell you right now there's probably very few organizations, sectors, that are as concerned about trust and data as the big telcos. Welcome to Shift.

Pamela Snively: Thank you. Great to be here.

Jon: Chief Data & Trust officer. That's your title. Tell me, what does that mean to you? 

Pamela Snively: I get asked that question a lot because it is an unusual title, and I will often sort of just dismiss it and say, "Well, it's really just a fancy word for a Chief Privacy Officer," but it really isn't and that title, in fact, is a large part of the reason why I took the job at TELUS.

When I first started interviewing for the position, it was Chief Compliance & Privacy Officer, and over the course of discussions with some of the executives at TELUS, and largely with our CEO -- who is deeply committed to customer trust, maintaining customer trust, earning customer trust, we started to talk about privacy at a deeper level and we realized that it really shouldn't be about compliance. It should be about maintaining customer trust.

Jon: It sounds like a nuance, but it actually isn't, because if you think about compliance, it feels very internal organization -- "It's about us". And I love the fact that you're focusing on the customer, because that's really what it's about at the end of the day. No customer, no business.

Pamela Snively: That's a great point. I love that perspective on it. It also makes it a lot easier for our business to understand why they need to do what they need to do. When I go in and talk to the business about maintaining and earning customer trust, that's a language they understand. They know how critically important that is, and that is what their entire business is about. So, if I can put privacy and respect for the personal information of our customers into that language, then they understand it and the whole game is transformed.

Jon: When we start to think about things like trust and privacy, and how it relates to the customer, it feels like there's a lot more room for innovation, and changing, and impermanence, if you will, because everything's moving, everything's changing.

Pamela Snively: That's so true. There are no limits to what we can do to continue to earn and maintain customer trust, and we are constantly looking for ways that we can go a step further.

But there are so many more opportunities and it's a discussion we have daily, like "What more can we do? How can we communicate better with our customers about what we're going to be doing with their data, and how can we be more thoughtful about it in all of our business initiatives?” And of course, in today's world, there are so many business initiatives that relate to data. I can hardly think of any that don't.

Jon: Do you have to earn customers' trust, or do they already start the relationship already trusting you, and you're now in a position to either keep it or lose it?

Pamela Snively: I think that depends on the customer. I think that there are pockets of customers out there that are, in today's world, starting off skeptical. And then there are others that are trusting and they sort of make assumptions about large organizations or about any organizations, and quite frankly there are those who just don't think about it much at all. But they will certainly think about it if we do something that jeopardizes their trust.

As the public is hearing more about these egregious privacy breaches, or just breaches of trust, in terms of how data is used, which is not necessarily the traditional someone hacked in and got your data, now it's breached in the way that people think about it, but a breach of trust in terms of how we used it. I think we are starting a little bit behind the gate and we have to earn that trust going forward.

Jon: It's really interesting, because especially in a position that you're in at TELUS, you have a lot of data on people, not only personal data, but financial information, and it could kind of go either way, because when you have a lot of data on someone, there's a lot of benefit to the customer as well because of what you can do... Like you say, "What can we do with the data?" It's not like it just sits around. What's the end game for all this?

Pamela Snively: That is a huge priority for us, is to use the data in a way that will make their customer experience better. It's important to look at providing choices for customers, better ideas about what products and services that particular customer might be interested in, being aware of where they are in the cycle of a particular contract, where they are when they've most recently bought a phone, all sorts of different aspects to our relationship with them on the telecommunications side.

Jon: Along with data, you have to have sort of checks and balances in place to make sure that it's private, so what kind of steps do you guys take in order to ensure that there isn't a breach, that the data is used correctly, that there's security measures in terms of who can access it? 

Pamela Snively: So, if we're assessing how a business might go ahead and use data, we would work with the security department to make sure that at every step in the process of utilizing that data, the data will be kept secured. So, how it's transmitted between areas within the company, for example, could be an area of vulnerability, so we'll focus on that as well as of course always where it's stored.

But in addition to that, whenever any part of the organization wants to for example use data for a different purpose, and this is different from security, they need to come to our department and submit what we call a privacy impact assessment, but go through a review for us to determine whether or not that's in keeping with our commitments to our customer, in keeping with the reasonable expectations of our customer. Would they be surprised or shocked by that use of data? That's not something we ever want to do.

Jon: Do you think that most organizations have the right amount of thoughtfulness if you will, when it comes to data and privacy?

Pamela Snively: I think in Canada we have a pretty mature privacy tradition among our larger organizations, so I think that there is a lot more thought that goes into this than many people realize within larger organizations.

Jon: At TELUS, when stuff does go wrong, and we're all human, so things will go wrong, how do you remedy it? How do you make it feel okay from a customer experience?

Pamela Snively: When we talk about having a breach readiness and response plan, we know mistakes can happen. Breaches can happen, but it's how you respond to the breach that matters, and that's where the trust is going to come in. It's whether or not it's clear to you that the organization is taking it seriously and trying to make this right. And if you don't feel that way, then they've lost your trust. 

Jon: But when things do happen, and they might, what you do as a result of that is equally important, if not more important, as you say, in engendering trust, keeping trust, and even potentially getting more...

Pamela Snively: Building trust.

Jon: Building trust.

Pamela Snively: In our minds, we'll treat this as a lost customer that we need to recover and we'll do everything we can to win back that customer's trust and business.

Jon: It's interesting too, because people, customers will advocate or not on your behalf after it gets resolved. "Hey, let me tell you what happened at TELUS. It was amazing," or "It was terrible." That's a powerful thing either way.

So tell me, there's a lot of eyes right now on the Canada Mandatory Breach Notification. It's coming November 1st.

Pamela Snively: Right.

Jon: I think that's probably a five alarm fire for a lot of people. Tell us a little bit about that, for those who don't know, what this breach notification is all about.

Pamela Snively: The Mandatory Breach Notification requirements have really kind of two main prongs for organizations, and the first is ... well, three, I guess.

The first is when there is a data breach that involves personal information, a report has to be made to the [Privacy] Commissioner, if the breach rises to the level where there's a real risk of significant harm to an individual. So, it can be even just one individual, it doesn't have to be a large scale breach. So, that requires reporting to the [Privacy] Commissioner.

It also requires notification to the affected individuals, so the individuals who are at risk of harm. And then the third piece is also a record keeping requirement. I think it's actually pretty significant in terms of the effort that organizations have to put in, but less noticeable to the general public.

Jon: Do you think that organizations are worried about this?

Pamela Snively: I think some organizations are worried about it, and organizations never know how things will play out and what this is going to look like in practice, so there's uncertainty around it, which is never good for business.

There will be more reporting to the [Privacy] Commissioner now than there has been in the past, so we have been getting ready in terms of making sure our systems and our response protocol reflect that new requirement, the record keeping requirement -- which is, we have to keep a record of all incidents, even if there is no real risk of significant harm. So all incidents involving personal information, and that's actually a pretty broad requirement. But it is a shift in how most organizations set up their record keeping and respond to an incident.

Jon: So, why now? Why do you think this is important now?

Pamela Snively: I think it's a response to concerns about consumer trust in the digital ecosystem, and just making sure that people feel confident that if something has happened that's impacting them, that they will be notified.

I think the idea here is to have people be more aware of what's going on and allow them to protect themselves, and then I think the hope is that that will engender more trust in the digital ecosystem. It could go the other way, though.

We've seen other jurisdictions where we have this kind of notification fatigue, where people are hearing constantly about smaller breaches, and people just kind of pitch them out and stop paying attention to them. And I think that's equally dangerous -- if people stop worrying about their privacy and start thinking that a breach is just the normal course.

Jon: When it comes down to data and trust, it's really interesting, because there's some people who take it really, like, "My personal data is sacred".  

Pamela Snively: I think the Snowden revelations a few years ago have changed the way people think about it. It used to be just identity theft, and that didn't seem that real to people, or realistic, or didn't think that they were the likely target, and so a lot of individuals just didn't take it as seriously.

But now that we're hearing about a different form of abuse of data, and a larger scale surveillance program potentially, people are a little bit more worried from a different perspective than they used to be. It's not just about identity theft. People are concerned about that and they want more transparency around, "How is my data being used? And how is it being used against me?"

Jon: Do you find that you're needing to communicate to people a lot around what it is you're doing? Are they asking questions? How do you go around making sure that customers feel that you're being transparent with them?

Pamela Snively: We do find that they are asking more questions lately, so we take note of that and we are very conscious of responding to the questions that they are asking.

So after each of these scandals and each of these breaches, we will see an increase in calls in to find out if we're doing any of those things, or how they can be protected against those things -- who we're sharing data with, that sort of thing.
So, we will always try to address where we see a series of questions or patterns trending and questioning, that we'll try to put answers out there right away, if they're not already on our website or somewhere else available to our customers.

But one of the things that we've done is try to just put more information out, and not in a way that inundates everyone. There's enough jokes out there about everybody knows nobody reads privacy policies, we all just click agree. So, making them longer and putting more detail into those is clearly not the answer, if you really want to meaningfully gain customer trust.

Jon: Let's talk a little bit about the interplay between the level of trust a customer has with an organization, how much data they're willing to share or not share. Do you see a correlation between that?

Pamela Snively: I know I certainly fall in that category. I will think about the organization with whom I'm doing business before I decide how much information I'm going to give them. So I want to understand that my trust in the organization is one thing, and then what they're going to be doing with the data is the second thing.

Jon: That's really interesting, because now we're talking about brand reputation. Am I more willing to give a whole lot of personal information to Amazon versus some overseas e-commerce website that I've never heard of? And you think about it in those kinds of terms, then you realize that there really is a brand play here. Their privacy policies could be exactly the same. But then how do I really interpret it? 

Pamela Snively: So, even if the words are there, I look for an organization that has a reputation to lose. If they don't have a reputation to lose, then I know that their attention to my privacy might not cost them anything if they create a breach.

Jon: If you had advice for organizations big and small about how to take this seriously, maybe what to do, what would you tell them?

Pamela Snively: We have to really think hard as an organization about what your limits are and how far you will go, and really consider your particular customer base. I think that customers in one particular area of industry might have different expectations than others, so there's no one size fits all.

Jon: As the world becomes more digital, and as businesses become more automated… talking a lot about AI and machine learning and RPA, so that's the Robotic Process Automation, do you see that having an impact on trust and data cleanliness, and all that kind of good stuff?

Pamela Snively: Absolutely. That's a huge area of focus for us right now. When we're looking at privacy from the beginning, and it sounds a little hokey to say that one of the first things that I think you need to do is look at the principles that you're going to operate under, and that's going to be contextual to your industry as well as your own organization's corporate culture.

That's been the only way that we've been able to really drive change and structure a program that's meaningful at TELUS around privacy, and we're now doing the same thing again when it comes to AI.

And so we're starting again at the beginning of that journey and saying, "Okay, what are the principles that we're going to live by? What's our charter of ethics that we will commit to?” And then, “What are the policies and processes that we need to put in place to make sure we keep our word on that and make it true?”

Jon: That's really key. I think that's very important, I think. It's not just a box you check.

Pamela Snively: It's transformational when we approach it that way.

Jon: Privacy seems like it's in its own little box. Does privacy by virtue of what it is enable innovation or does it hinder it? What are you seeing in there?

Pamela Snively: I'm not sure if I see privacy in its own little box. If you're doing privacy well and you are doing it from this perspective of guiding principles and integrating it into the customer experience, and the customer trust model, then it's fully integrated. It's not a separate box. It's part of how you do business and part of how you make decisions about business every day.

But on the barrier side, there's some interesting dynamics there where often privacy is seen as a barrier to innovation, and I know even with some of the consultations that are going on right now with the federal government, the round tables on innovation are actually turning into discussions about privacy because people are seeing it as a barrier to innovation.

I think we have to see it as not necessarily an enabler of innovation, but a motivator for innovation, that we can do things differently and more creatively and arrive at the technology and the solutions that we want, that are still privacy respectful.

And in fact, sometimes privacy can actually motivate technology all on its own. So many of the fixes for the problems that technology brings can be found in technology. So let's use technology to fix the technology, and let's not just throw up our hands and say, "Well, this is just a problem with technology today." If we can design a problem, we can design a solution.

Jon: I'm gonna retract what I said about privacy being in its’ own little box, because how could it be? Because the world is changing and because there's new things that keep happening all the time, it can't, it's not static. We can't look at it as static. If something doesn't already exist or is leading us down a way that doesn't seem right, let's innovate around it. Let's innovate a way forward. That's a very cool spot to be.

Pamela Snively: I had this great moment this summer. My son is doing his degree in Engineering Computer Science and wants to get into AI, and had a summer job in a company doing some AI work, and he came to me after a week on the job and just said, "What you do is so cool. AI is 50% privacy." It was heartening to hear that it's being taught to him as 50% privacy -- like are we making sure that the data sets that are being used are allowed to be used for that; that that's consistent with the customer's expectations?

All of this is all feeding back into this whole concept of customer trust, and maybe it goes beyond what we've traditionally thought of as privacy, but I start to talk more and more today about data ethics rather than just pure privacy, because it goes beyond just our one piece of privacy legislation, and into a much broader field if we're talking about customer trust.

Jon: Well, it's interesting, because ethics by virtue, by definition, sounds like there's decisions to be made as opposed to is it private or not?

Pamela Snively: Promise and peril.

Jon: I love that. It's promise and peril. I love the fact that this conversation went beyond the idea of personal data as it relates to customization, because I think people want customized experiences and I think they're willing to give up a certain amount of data in order to get something that seems more relevant, and contextual, and timely.

We really got more into the ethics behind it and what organizations need to be thinking about in order to engender trust and set themselves up for that kind of conversation.

Pamela Snively: I think we're at basically a citizen trust tipping point in the government as well as in private sector, and this is going to be the moment in time when we make the decision to fix this and get it right, and do it right, and reap all the benefits and the promise, or we're going to -- it's going to pass us by. We're going to miss the opportunity.

Jon: I think that's a significant call to action for listeners, for organizations. It's like doing it right can have tremendously incredible impact to both the organization and the public. Do it wrong, and we miss the boat to... using data to make a meaningful difference in everybody's life.

Pamela Snively: That's why I love this job. 

Jon: My mind has been expanded and blown off the hinges a  little bit here, so thank you for that. And I hope other  people are thinking about privacy and trust, and data ethics in a completely different way, in a new light, because it's  even more important than I already knew it to be. So, thank you for that. And thank you for being here on Shift. I think  this has been a really important and timely podcast.

Pamela Snively: Thank you for having me.

Jon: Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/Shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on iTunes, Google Play or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers, LLP, an Ontario Limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

• Canadian Bankers Association: Digital transformation of banking in Canada
•  R-Labs Canada Inc.: The future of proptech

Jon: Hi. Welcome to Shift, PwC Canada’s podcast series, and we’re digging into key digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein, and I’m also the Creative Director of PwC Canada. We are on the road, we are in Vancouver at PwC. We have an extra special guest today, one of our V2R winners, David Lloyd, welcome.

David: Thank you you. Thanks.

Jon: Now, David is the CEO and co-founder of FREDsense, now FRED is an acronym.

David: Yes.

Jon: Tell us what the acronym is so people don't think like Pink Floyd, or somebody named Fred.

David: Yeah, so that's the big issue if we ever hire Fred into the organization, then they're gonna assume that they are the owner. But FRED stands for The Field Ready Electric Chemical Detector.

Jon: It is an incredible product because it's groundbreaking, which is why you won a V2R award. For those of you who aren't familiar with V2R, it's a PwC award show that we have, that basically honors and awards some of the groundbreaking innovation happening in our country. V2R stands for Vision 2 Reality, so if you don't know, check it out. Tell us a little bit about your invention, and why it's so innovative, and how it's changing the world basically, as far as I'm concerned.

David: At FREDsense, we are really excited and get passionate about water quality. We are all about trying to give people better information about what's in their water. When do you know your water's safe to drink? When is there something harmful in it? The truth is, we don't know a lot about what is in our water today. Oftentimes, even in an industrial setting, you have to go to a site, take water samples, and ship them off to labs. Sometimes that takes three to five days to get our water quality information back. You're sitting in an unknown state where you don't really know if the water you're consuming every day is something that's safe for you, or not.

At FREDsense, what we have been thinking about, is trying to make simple to use technologies that allow you to understand what's in your water right away, but simply enough that anyone can do it. We designed this product, where essentially what you do is, you take a water sample and put it into a small cartridge, it holds a very small amount of water, and then you put it into a lunch box sized detector that within one hour gives you a reading. You don't have to do anything complicated, you can just know right away, is there something harmful in my water that I have to worry about.

Jon: But what's really interesting is, this isn't really for consumers is it? This is a business application. This isn't like, "Hey I wanna test my tap water and see if it's safe to drink, is it?"

David: Yeah, exactly. Right now we're really focused on empowering water utilities, mines, and different environment groups, to be able to streamline their process. They can go and get that information right away, and effect whole cities and communities in terms of what's going on in their water infrastructure. They need better ways to be able to get that information right away, so their busy engineers, can make decisions right away.

Jon: Can you give me an example of how a water utility might use it? A scenario?

David: Yeah, so what some communities use a lot of ground water, so water that's found underground in order to serve their communities. One of the big problems there is that, arsenic can be naturally found, so arsenic at very low levels can be a human health concern. There's a lot of treatment technologies that have been made available to clean that up. For many cities that have a whole bunch of ground water wells throughout their infrastructure, you can imagine someone having to drive around, take a bunch of samples, wait a few weeks to get the data to see if that arsenic cleanup process is working well. Well this gives them the ability now to understand what's going on right away. That's a huge time saver for them, and something that ultimately impacts all of their residents, because they can give better accuracy, and give them better confidence that what they're drinking is good.

Jon: Wow. That is like blowing my mind actually. What was the driving force for you behind this? You're the CEO and founder of FREDsense, how did this all come to be?

David: We have probably one of the weirdest startup stories and I'm really proud of it. I think it's been a ton of fun to see how it's developed. But, FREDsense started a few years ago, and myself and my other co-founders, we were undergraduates and graduate students at the University of Calgary.

What we did was, we got together on our spare time, and wanted to enroll in this competition called IGEM. It's a big MIT based genetic engineering competition. We had a team of about 20 to 30 people, and we had this idea that we could use bacteria to make an impact on the water space. What if we genetically modified these bacteria to be able to sense different types of chemicals in our water, so that they could tell when they were there? Bacteria have this natural ability to respond to different types of chemicals in their environment. Then what if we got them to produce an electrical signal if those compounds are there.

So we put this technology together, ended up going to MIT, and things went really well. We ended up winning a number of awards at this competition.

Jon: How did you come to think that, what if we genetically modify bacteria? I mean that just seems like, it sounds very science fiction, which is super cool. How did you think to do that?

David: Yeah, so there's this new field that I am so passionate about, called synthetic biology. It's this idea of using biological systems and the components of biological systems to build living machines essentially.

There's all sorts of amazing applications going on through the world right now, where we can build these sorts of systems to generate new products that are really changing the world. I got my undergrad at the University of Alberta, and I remember in my third year, I was just in this class, and we were talking about molecular biology. How does DNA and all these little parts inside of cells work?

Someone had mentioned that…we're at a place now in science where we can understand how these systems work, to the point that we can take bits of them, put them together in new, wonderful ways, to be able to create these products that can do things. At the time, they were recruiting for this competition and I thought, "Wow that is what I want to do, and I want to figure out how to be a part of that." Kind of started on my journey.

Jon: That's an amazing story. I mean, tangentially for a second, I guess bacteria are not sensions, you're not going have like the people with plaque cards going, "You're genetically modifying bacteria against their will, this is awful."

David: Yeah, well I think that's a big part of what we do at FREDsense, and just more generally in synthetic biology is, when you hear about genetic modification, you think zombies, or you think viruses, or you think all the things that we see in movies. But really, this is an amazing technology that is allowing us to generate incredibly positive impact, and do it in a safe and secure way. What we think about a lot is, how are the choices that we make as a company going to impact the water operators, going to impact people in communities.

That effects our design and how we think about doing this because, there's no point in use creating a product if people are going to be fearful of what it is we're producing, or how it's going to be implemented.

How can we translate these systems into something that people will actually use. Which I think is the most important part of what we're doing on this development cycle. That there's a lot of great ideas that don't make it out of the lab, because we don't think about how this is ultimately going to affect people, and how they're going to use it.

Jon: I love what you're saying there because, while I don't really know much about science, I'm a creative guy, one of the things that we really focus on, at least in my career, and especially PwC’s, we talk a lot about human centered design.

David: Mm-hmm (affirmative), yep.

Jon: This is kind of like a call out for listeners, even when we're talking about science, and something as incredible, I mean it sounds like Star Trek to me, what you're genetically modifying bacteria to send different electrical impulses to detect stuff. It's like mind blowing. But even that level of science requires human centered design, and really making sure that you understand who you're designing for, so that they ultimately use it. How did you go about testing it with end users?

David: We've had a long journey in testing it with a bunch of people. To your point about human centered design, and creativity, and that being at the center of what we do. We spend a lot of time just trying to understand what ... because we aren't engineers, we're not operators that work in a water context. What is it that they're really struggling with, and what are the challenges? What really differentiated I think this product from a lot of the others on the market, and what we were seeing with a lot of other field kits was that, it wasn't necessarily the science that was holding people back, but it was the usability.

When we were able to come and say, "Hey we have a new way of doing things that's relatively simply for you to be able to adopt. It's just a kit, you can take it out, you can try to test it." We found a lot of utilities that were very open to taking it, and trying to use it. That is how we were able to first get some adoption, and we could build case studies off that.

Jon: Did you have to iterate the prototype a lot based off of feedback?

David: A lot. Oh my gosh, I think if you looked at some of our earlier prototypes, you wouldn't even recognize it. There was so much iteration that happened.

We take something out and people will go, "That is really difficult to use for x, y, z reason." We come back and say, "Okay, how are we going to change that part of the product up?" It was funny how many things that we didn't even think about came up.

Jon: With any innovation, I'm sure there was some pretty dark moments through the process of bringing this to market. I've got to imagine there were times where you just thought, "This isn't going to work, this is going to fail." Did that happen? If so, how did you overcome it?

David: Oh my gosh, how much time do you have? I think the funny thing with our story was, we were six people that came out of this competition at the University of Calgary, this team, and decided, "You know what? In the heart of this oil and gas city, we are going to build a bio tech company that's going to use these bacteria to change the way we think about water."

You can imagine that there were probably some people, there were some people that thought we were a little crazy. There was this crazy idea that these six young people had to go and try to make a difference in the world this way. We had a number of challenges at the beginning. Everything from intellectual property, to the team, to getting financing, to figuring out how we were gonna build the product.

Yeah, absolutely, there were a lot of points where I think we sat down and kind of went, "Can we do this? Are we gonna be able to make it happen?" I'm so thankful to have the co-founders that I do, because we were able to come together and really say, "You know what? When one of us are feeling down, we can do this. We can move this to the next step. We believe in it, we know that this can happen." That sort of belief I think is what kept us going. A great advisor of mine said that, "The only difference between the startup world and the real world, is that the highs are higher and the lows are lower."

Jon: Innovation isn't easy, okay? It's very hard to do. I think a lot of organizations probably underestimate maybe the effort, or the time it takes, or really what's involved. You've been very successful. What advice would you give to organizations large or small, who are looking to innovate?

David: Innovation is uncomfortable, it's going to feel different. It's got to bring around change and mindset, and change in thought. I know at FREDsense, what is so important to us, is hearing everyone's thoughts and perspectives, and having people that are of a mindset that they want to innovate inside of the company, and outside of it. Having the right people who can prescribe to that perspective of the importance of being able to bring up the things that aren't working, and know that their voices are going to be heard.

I think that there's that uncomfortable nature, there's that need for the organization to get on board completely with it, which can be hard. Having the right people who are going to not only see how what innovation could look like, but how to follow through with it.

Jon: Yeah, one of the themes that we've heard through some of the episodes we've done, and certainly strong leadership, shared vision. Tell me about, where is this technology gonna go?

David: Our vision for the company is really to become a one stop shop for your water quality needs. We think that this approach of using bacteria to solve these problems, really allows us to build a platform out, for all sorts of different issues when it comes to chemicals that are found in your water. We're developing new products to target a variety of different types of chemicals right now. Things like, Iron and Manganese, we're looking at things like Chromium, Lead. All of these have different issues surrounding your water chemistry.

We're really excited about the possibilities of bringing new types of products that are gonna solve complex issues for industry, and also for consumers.

We're constantly thinking about, how can we disrupt an industry? How can we provide real value that's going to tenax the status quo? That's what we wanna do. I really prescribe to that Silicon Valley of the moon shot, right? We are not looking for incremental improvement here, we are looking to really provide an extreme value into these industries, and do that with these sophisticated, new technologies that are coming out. You bring up a great point that, to be the disruptor, you need to understand what will disrupt you moving forward.

I think that's really important. We're constantly looking at what new technologies are coming on to the market that could be beneficial to what we're doing, or to compete against what we're doing. Ultimately, the great thing about the segment that we're in is, the more companies that adopt our type of technology platform, or new technology platforms that are moving this industry forward, the more we all collectively win. The we in this case is not just the companies, us, FREDsense, but the consumers, the utilities.

Jon: With any new technology, it's not only really hard to create it, but I'm assuming that's also ... It doesn't matter what it is, it's hard to convince people that this is awesome. How do you overcome external doubters? How do you get people to see what you see?

David: I think it's a complex question, and there's a bunch of different areas that that makes me think of. The first one was, first experience we had very early on when this was just an idea is. We were trying to apply for a grant to get some of our initial lab work done, and we had put a proposal together, walked into a room with a bunch of very suited people who are quite official, that tore us apart.

I think that was really an important part, and a theme throughout our development was, when someone came up and said, "We don't like what you're doing," we learned from them. We learned the things that they didn't like, and improved what we were doing.

What we think a lot about, and I put this back into the iterative design part of the product, and also our approach to solving problems, is how do we lower the barriers and ensure that when we design a solution for a client, that it's actually going to be something that could be adopted for them. That's so important in the utility and mining space to ensure that what we're putting together is not just going to work from a solution perspective, but also from the procurement perspective, for the entire team.

Jon: That’s amazing. Tell us a little bit about your mining industry pilot. I understand you started working with a Canadian mining innovation council. What was that all about?

David: Yeah, so it's been great to work with CMIC, Canada Mining Innovation Council. They are a fantastic group of people that are looking to take innovations and technologies across the board in the mining sector, and help support them to be adopted across industry. We've been working collaboratively with them to be able to pilot some of our arsenic testing technologies. The mining industries a really interesting one because, no two water samples are ever the same. What you find in your drinking water of course is going to be drastically different than what you might find in the environment, or in some of these industrial applications.

The big challenge for sensors is that, sometimes this water gets a little complicated. A lot of what we're working with them to do is to demonstrate and show that because bacteria are capable of being used to responding to lots of complex things found in water, we can use this approach in some pretty complex and dirty water. That's been going great, so we're gonna be finishing up a project with them later this year. With that data, we're really hoping to see some of these systems get adopted across the industry.

Jon: Question: Did you find any specific barriers to working with the mining industry that you had to overcome that were maybe a little different than let's say with water utilities?

David: I think that mining companies are complex. They have a lot of operational sophistication, but they also have a lot of catch up to do in terms of how other industries have adopted technologies. There's a lot of reasons for that. There's so much complexity in putting together, exploring a site, building an operation, and continuing to monitor over time. These are not small projects. As a result of that, the time horizons that you're looking at for these sorts of projects are not five years, they may not even be 10 years, they could be significantly longer. That's difficult to be a new technology coming into the industry to all of a sudden say, "Hey, now try this out.

Implement it into what you're doing, particularly with that complexity there." But there's amazing pockets of innovation going on. Groups like CMIC, there's other groups internally that are recognizing that innovation is going to be the thing that disrupts their industry, and that they need to be part of that change.

There's definitely some specific challenges to adopting new innovations within the industry, but again it goes back to how can you design around that, and how can you make it easier than ever to see your technology end up in their hands.

Jon:. As a V2R entrant and now as a winner, what advice do you have for anyone who's thinking about entering V2R for next year?

David: Apply, do it. Go into the competition, particularly if you think that what you're doing is innovative. I think there are far too many fantastic companies that just don't apply to a lot of these things. That would be my biggest recommendation is, just go in, do it, tell your story, be passionate, because you never know.

Jon: All right, well that wraps up another incredible edition of Shift. You know what David, I'll never think of bacteria the same way in terms of how beneficial it can be. You've done something that I think is gonna change the world, so congratulations, not only on a really powerful innovation, but for winning V2R.

David: Thank you.

Jon: Thank you so much for telling us all about it, and spending your time with us. I think people are gonna get a lot out of it, I know I certainly did. Good luck in what happens in the future, I can't wait to hear more, and to read more, and to follow up on your success.

David: Thanks, it was really a pleasure.

Jon: Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/Shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on iTunes, Google Play or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers, LLP, an Ontario Limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

• Civil Resolution Tribunal: Keeping humans at the center of the equation (Innovation series)

Jon: Hi. Welcome to Shift, PwC Canada’s podcast series, and we’re digging into key digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein, and I’m also the Creative Director of PwC Canada. Today we have an amazing guest, Mark Bryant, who is the chief information officer of PCL Construction, and latest recipient of a V2R award. Congratulations for doing that. Tell us a little bit, what was it like?

Mark: The award ceremony was awesome. I got to meet a lot of peers and colleagues across multiple industries. It was exciting..

Jon: When you did the entry, did you think that you were going to win?

Mark: We knew we were going to win.

Jon: Yeah? Were you super confident?

Mark: Absolutely. We're super confident. I’ve got an amazing team. We've made a significant transformation. I went in there with a high degree of confidence that we were going to take it away.

Jon: That's wicked. Congrats. Tell us a little bit about yourself. What do you do at PCL?

Mark: I'm responsible at PCL for the entirety of our IT operations and digital transformation strategy as it relates to moving technology forward in the organization, primarily with a focus on how do we drive digital transformation in the field. How do we transform that operation of the organization to be more digitally enabled to do things with a higher level of productivity, higher level of creativity, higher level of efficiency, higher level of quality, and higher level of safety.

Jon: When I think of construction, I don't automatically go to digital transformation. I think of machinery, I think of people constructing large buildings. Clarify for us, a little bit about how digital and digital transformation plays a role in construction.

Mark: Well historically, it hasn't, so it's a great question. We do things on a job site today that we've done 50 years ago, 75 years ago, 100 years ago. That's where the opportunity is. Taking away paper process, streamlining and automating things that would be done by arms and legs moving. A great example would be we use iPads on the job site today to do safety inspections and quality inspections. We're doing things instantaneously at a job site today that historically we would take hours to get back to a sub trade. Those things, those digital technologies allow us to do things more efficiently, make sure we have a high level of safety and a high level of quality, and that's what customers want.

Jon: PCL is 110 years old. I've got to think there's all sorts of deeply rooted opinions. "This is the way we do things. “It's been working this way for 100 years and we're like the top”. “Don't talk to me about iPads and digital transformation." I'm guessing though.

Tell me, was it difficult? When you started the process, was it one of those things where the organization goes, "Absolutely. We need to do this," or, "I'm skeptical."

Mark: It's probably the 80/20 rule. You probably have 80% of the people in the organization that say, "Yeah, we've always done it this way. We've battle tested it, battle scar it. We've gone through the battle scars. We're going to continue doing it this way. There's always that 20% that just wants to disrupt a little bit more and open a change.

You have to find the people in the organization that are willing to make the change and get them to be part of the change with you. If you don't, you won't have the organizational success. The other thing I can say is, you can't boil the ocean over-night. You've got to start really small, very tactical. Where's the immediate business value and work with those people that do want to disrupt and change. Then use that as your proving point. If you can do that with one or two of the naysayers, bring them along for the ride. It adds credibility for the next one. You've got to keep building on that momentum. You can't do one and stop. You've got to continuously keep adding momentum as you gain it.

Ironically, the demographics are shifting as well. We have a lot more young people coming in to the work force, that need or ‘I expect your company to be in the digital era’. We bring students in to help us with the new thinking. It's a great learning experience for everybody in each of those specific roles.

It allows us to see things that we may not have been thinking of, and it brings forward new ideas and that change. I think the most important thing in any organization is the management of people and change. Without that, the technology doesn't matter. Partnering with a younger generation and allowing those students to come in and say, "Hey, have you guys tried this?" is positively disruptive, I think, in the organization.

Jon: Let's talk about change for a second. You talked a little bit about, doesn't matter how great the idea is, if you don't have change management in place, if you don't have a way to get people on board, you're pretty much dead in the water. Tell us a little bit about how you did that within PCL

Mark: Change management around people is probably the most complicated thing. In the early days, it was probably one of the things we overlooked the most. I think people were a little bit scared that they were going to lose their job by us moving technology infrastructure to the cloud. That's when the light bulb went on about managing the people change. How do we get people on board, make sure that they're part of the process, understand what they want to do in the future, look for opportunities to retrain them.

Give them really good visibility into what was going to be next for them, ideally, something that they were passionate in. Communicating and evangelizing early and often is critically important.

 I think it's critically important to help people understand what's in their future, making them part of it, retraining them, and really getting them involved.

Jon: I love what you said about, "Hey, consider it this way. We're going to change from X to Y. In doing so, it opens up a whole world of potential opportunity that didn't exist before for you.

Mark: Absolutely. I had to ask people, "Why did you get involved in technology?" I personally got involved in technology 20 some-odd years ago, because I don't like doing the same thing every day. I like challenges. I like obstructions. I like figuring out how to get around them. I like embracing new technology. I think our change metamorphosis really woke everyone up, to help them re-realize why they got into technology and reengage their passion, reengage their energy, and reengage their spirit.

Jon: There's a quote that I really like. It's very simple: “habit is the great deadener”. I find that that's, for me, I love tech as well. Doing things differently, you find when you get into doing the same thing over and over and over again, you just go into autopilot. Nothing awesome happens.

Mark: I think there's a lot of organizations that are in that stagnant state. You have to take a leap of faith and you have to understand and have a vision of where you want to go, how you're going to get there, how you're going to get people involved, how you're going to communicate it and what the processes are. If you don't have those ingredients in that Crock-Pot, you're going to fail. It's a great question, because you have to have all those things in that Crock-Pot for that to taste good. If you don't, you're going to see something there, but you're probably not going to want to eat it. If people aren't eating what you're selling, you're not going to have success.

Jon : Maybe we could spend a second telling us a bit more fulsome if you will. When you won V2R, what did you win it for? Tell us about your transformation.

Mark: Well first, I won for the people. I had a four-prong strategy in my vision that I laid out. It was cloud-first mentality.

How do we mobilize? How do we enable mobility in the field? How do we use data and analytics to drive decision making? Then what's the integration technologies that we use to stitch that all together? It was the combination of those four things that have allowed us enable our digital transformation strategy. The fourth ingredient in that mix though, that is, as I said, more important than the technologies getting people onboard.

I can tell you, those four things that we did, that have transformed us significantly, have set the stage for their digital transformation that we're working on right now. Certainly, cloud, first and foremost has allowed us to streamline the operations of what I would call traditionally technology operations of the business, so people keeping the blinking lights on in the back end that are usually not seen by most organizations.

The mobile component of that strategy is enabling us to do quality inspections, safety inspections, use of drones in the field, augmented reality, virtual reality, in the field, driving different practices around, construction, virtual estimating. We're doing that as well. Then shifting to data and analytics, we have a huge data analytics practice.

Jon: Love to hear a little bit more about AR/VR and some of the practical applications. Do you have an example?

Mark: Yeah sure. We're building towers all over North America. There's a specific tower that we're doing today where we've used augmented reality to allow an owner to visualize what a finished tenant's suite will look like, based on the materials and features and functions that the owners expect. We can actually take the owner right into the 45th floor of that facility. Have them put on the goggles in an unfinished room, and actually see what those finishes will look like. It gives the owner a great level of confidence that they've picked the right builder, they've picked the right materials.

Augmented reality really gives you a feeling of comfort that it's going to be what you envisioned. When you're investing millions of dollars in a building, that's a peace of mind. That again, enables us to drive a different level of value in customer satisfaction before we even put a shovel in the ground.

Jon: That’s amazing. You're entering another phase of your transformation. What's next?

Mark: Excited to tell you, this is probably one of the most exciting things I've worked on in my last 10 years in my career. The next phase of our digital transformation is around two prongs. One is smart construction. One is smart buildings. Let me tell you a little bit about those two things.

On the smart construction side, we're expanding that business analytics that I referred to earlier to something called job site insights. We're going to be leveraging IOT sensors to instrument job sites with sensors that measure things like heat, humidity, vibration, noise, barometric pressure, volatile organic compounds. We're putting those on the work face of a construction site. To make sure that things like mill work, making sure that the temperature and humidity in a room is kept at a constant, so we don't have mill work issues.

We're instrumenting sensors on materials for materials tracking. We're instrumenting sensors on people to make sure that they're safe and we know where they are on the job site. Those are a few items that we're doing and currently active today in pilot phase, to enable a job site to be smarter.

Our project analytics dashboard is going to graduate to job site insights, that'll still have safety and financials and quality and all those other things, but will also have the telemetry data from the IOT sensors, that allow our construction manager, our general superintendent and project manager to have a really good view of what's going on at that job site at any given time. That's job site insights. We don't think anyone else in the industry is doing it.

On the flip side, we have owners continuously asking us for a smart building. A smart building could mean several things to people. Traditionally, a building management system is installed in all buildings. That primarily focuses on energy. Again, using IOT sensors, we want to be able to provide a buffet of sensors to an owner that say, "Hey, you want to measure how many times the elevator's going up and down? We can put a sensor in that elevator."

You want to understand how many people are coming in the west entrance versus the east entrance? Would you like a sensor to count people? Do you need facial recognition?" The list goes on. If you can dream up a need, likely a sensor out there that does it.

How can we, when we commission a building and turn it over to an owner, put all those sensors in, measure what they're doing, give the owner great confidence that not only the traditional building management system, but all the sensors that they put in to manage their building? How can we hand that over to them with great confidence on a single pane of glass for them to then, on a go-forward basis, manage their building?

That’s PCL's vision of an intelligent building.

Jon: That's really, really interesting. I can totally see the power of all of that analytics, all those sensors, where does privacy and concern for privacy factor in?

Mark: Well, the only are that privacy really would be an issue is if we did something that tracked you as an individual. Depending on the state or the province that we operate in and the privacy laws there, there may be certain things that we have people review and sign and understand. Certainly we're encountering that now. Early days for, certainly around people tracking, that's where privacy would come in.

Jon: Smart buildings, smart technologies, IOT sensors, cities are changing. What's your view? What do you think about smart cities and where's it going?

Mark: I don't think you have a smart city without smart construction. You can't have a smart building without smart construction. I think smart cities are going to be a result of smart construction and smart buildings together.

We didn't refer to it earlier. I think one of the things that is equally important and needs to happen is, we need to have a good focus on artificial intelligence and machine learning. Certainly as you start multiplying this thing out. The ability to scale it needs artificial intelligence and machine learning. I think a smart city needs those things, but conversely, I think the smart construction and the smart buildings I referred to over time, are also going to need those technologies to be capable.

I think there's an amazing opportunity there, but I don't think it happens without really smart government regulation.

We've got pockets in Montreal, Toronto, and certainly Edmonton is a top 10 AI school. I don't know if that's well known across the country. I think we need to leverage those things. We need to embrace them. If we don't, my concern as being a fortunate leader of a Canadian construction company and technology is that we may have a brain drain. Let's not educate our people here in Canada, have them go south of the border to feed a US technology company. Let's keep them here locally and figure out how we can embrace the technology solutions that we have here, homegrown in Canada and drive greater prosperity for Canadians.

Jon: Absolutely. You guys are living the promise of smart construction. Seeing a need for artificial intelligence, machine learning and those skills, it's like it becomes self-fulfilling prophecy in a way, which is awesome.

I had the good fortunate of interviewing Councilor Michelle Holland on one of the podcasts. She heads up the innovation economy for the City of Toronto. Working really closely with the mayor and going out around the world talking about how, and obviously, her purview is just Toronto. There's a lot going on in Vancouver as well, and how it's a hotbed of innovation, and how we need to continually fuel it. Not only to keep people here, but to mitigate the brain drain, but also attract people and to really be a leader in smart technology. It's a very exciting place to be.

Mark:   You just painted an analogy without realizing it. What you just described is exactly what we had to do internally to drive our digital transformation at PCL. We had to make it exciting. We had to get people involved. We had to keep people engaged. We had to get small wins. We had to keep that momentum going. That all allowed us to keep talent that we had, but also attract new talent as we transformed. On a larger scale, we have to do that in cities across the country.

I think we have a phenomenal opportunity to reinvent our economy in a smart, digital way.

Jon: Think about okay, you're talking to a company that feels very legacy. Potentially old school. We talked about that as being construction. The lessons learned are, communication always seems to be the one that sticks out. Yes, you have to have a vision. You have to have a road map. You have to have executive leadership buy in and then also what's going on at the grassroots level.

Mark: You have to communicate early and often. You have to show the benefits continuously. Whether they're work related, financially related or productivity related. You always got to be able to show here's what happened. Here's what's changed. Wins generate confidence. Confidence generates momentum. Momentum generates excitement. Excitement generates new thinking. New thinking generates the opportunity to drive new technology and new solutions.

If you get enough wins under your belt and continuously build that moment, that crazy idea over there is no longer a crazy idea anymore. It's like, "Why don't we try it out?" We spend a small amount of money on R&D that we may not have spent in the past. What's critically important, everything I just said is, it's okay to fail, then move on to the next thing. Agile development helps us do that, an open mind helps us do that.

Jon: Mark, congratulations again on winning the Reinventor award in our Vision to Reality awards this year. That is no small feat. I'm sure the competition was fierce. I'm glad that you were able to be in town to accept the award. Equally grateful for you spending time with us, talk about your transformation. The highs and the lows, and what it really took to transform what a lot of people might think in construction, being a very old school legacy industry, and really changing the game, not only to improve how you're doing work, why you're doing work, the type of work that you're doing, and really becoming the one to beat.

Mark: Thanks Jon. I really appreciate that. I guess what I would say is, I'm grateful to my team, because my team earned the award. I didn't do it as an individual. It was my team that earned the award. I think we're only in the first few innings of our digital transformation game. Certainly, we're excited about the innings that we're playing in right now and what we're about to do next. Pretty excited about it to be quite frank.

It's a great time to be in IT. It's a scary time, but it's a great time as well.

Jon: You're right. As soon as you finish one sprint or one area of a transformation, it leads to the next one. It leads to the next one. Small transformations lead to a much bigger one and then a bigger one. There's no sitting around resting on your V2R laurels. I'm sure you're working on the next ideas for the next application, for next years, 2019.

Mark: We've got the hologram in process.

Jon: Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/Shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on iTunes, Google Play or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers, LLP, an Ontario Limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

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Jon: Hi. Welcome to Shift, PwC Canada’s podcast series, and we’re digging into key digital trends and topics that can make your business transformation a reality. I’m your host, Jon Finkelstein, and I’m also the Creative Director of PwC Canada. Welcome to another episode of Shift.

We are in sunny Vancouver. We've taken it on the road. Thanks for joining. A very exciting podcast today, we are getting into some significant innovation today. And what it takes to be innovative in public sector. I am here with Shannon Salter, Chair of the Civil Resolution Tribunal. Unbelievable. I can't wait to talk about what you're doing because it's super exciting. Welcome to Shift.

Shannon Salter: Thanks very much, John. I'm happy to be here.

Jon: And congratulations for winning V2R in the accelerator category. That is no small feat.

Shannon Salter: We are thrilled on behalf of our entire team. We are so excited.

Jon: What was your reaction when you found out?

Shannon Salter: I was just so excited, and I couldn't wait to be able to share it with my team. They were blown away and very, very excited as well.

Jon: Tell us a little bit about your entry, what it is. What is the Civil Resolution Tribunal?

Shannon Salter: The Civil Resolution Tribunal is an administrative tribunal, and there are many of those across Canada, and 27 of them in BC. Administrative tribunals are kind of like courts in the sense that they create binding decisions on different aspects of people's lives, different disputes. The thing that makes the Civil Resolution Tribunal different is that it's the first online tribunal in Canada. And as far as we knew, it was the first one in the world that was publicly integrated into the justice system.

Jon: I want to repeat that again because in case people didn't quite catch that, the first online tribunal in Canada, and maybe the world. Think about that for a second. That's huge.

Shannon Salter: It's exciting to have seen it go from this idea, this piece of legislation, to a reality. We've now accepted close to 6000 cases. And it's exciting too because we get inquiries every week from different jurisdictions around the world that are closely tracking what we're doing and starting their own projects, so it's kind of an idea whose time has come.

Jon: Unbelievable. So where did the idea come from?

Shannon Salter: I have to be clear. It wasn't my brainchild. It was the brainchild of a very small dedicated team within the Ministry of Justice in British Columbia called the Dispute Resolution Office. And they shepherded through the Civil Resolution Tribunal Act, so a piece of legislation back in 2012. And they did it at a time when online dispute resolution was really very theoretical. There were no examples to follow, and so they took a real risk there. I was appointed in 2014, and that's when we were really ready to start implementing. And now we've got a team of 43 full-time staff members, and we've been resolving disputes for two years.

Jon: Unbelievable. What was the biggest hurdle do you think, to go from this kind of theory, legislation, to making it a reality?

Shannon Salter: Well, there are definitely a lot of challenges along the way. We were both blessed and cursed with this blank slate. There wasn't really a path to follow, and so we had to look at what evidence was out there, what best practices were out there, what research was saying, and try and make the best research based decisions we could along the way. The hardest part by far was change management in the legal community. The legal community is very risk adverse. It's very change adverse. That's the nature of the legal profession. And so winning hearts and minds was really probably the most challenging part and the biggest part of my job for the first couple of years after I was appointed.

Jon: I love the fact that you've taken basically a bricks and mortar. I have dispute, whether it's a condo, or small claims, or whatever, so it's under $5000. Normally, I have to wait for a court date. Normally, in the old world before this, I would have to show up at court. Now you've taken it online. Take me through the steps a little bit about how this works for a person, how this works for BC citizens.

Shannon Salter: Sure. And probably a good starting point is to explain what it is we have jurisdiction over.

Jon: Awesome. Yeah, please.

Shannon Salter: We have jurisdiction over condominium disputes of any amount, so it can be hundreds of thousands of dollars. And these are ordinary neighbor disputes. A big chunk of our population in British Columbia either owns a condo or rents a condo. And until we opened our doors, people had to go to the BC Supreme Court, which was very expensive and time consuming and complicated. And as a result, they just didn't. And so they tended to just have these festering disputes that would chip away at these communities. So we started resolving those disputes in 2016, and then a year later we were given jurisdiction over small claims disputes $5000 and under. And then just a couple of months ago, the government passed legislation to give us jurisdiction next year over most minor motor vehicle accident disputes as well, which is going to be a massive step forward.

So anybody who has those kinds of claims can go to our website at civilresolutionbc.ca, and the first step is to get more information about their issue. And this is really to help them resolve their dispute without even having to file a claim with our tribunal. They go through something called the solution explorer, which is free and anonymous. And it gives people pretty bite sized bits of plain language legal information, as well as tools like template letters that they can use to resolve the dispute themselves. And it comes from basically asking people questions about their dispute and then giving them answers based on those questions. So it's called an expert system. It's a very basic form of artificial intelligence. But we want people to have some good information when they come into the process to even the playing field between more sophisticated and less sophisticated parties, but also ideally helping them resolve their dispute so that they don't even need to come to us.

Jon: I love the fact that you can avoid filing a claim just by working through what it is. What is it you want to do?

Shannon Salter: Exactly.

Jon: Can you solve this yourself? Here are some tools to try and do it yourself as opposed to feeling the need to actually file something. 

Shannon Salter: That's right. And it's really a preventative step. We know it's best for people in terms of their financial, physical, and mental health not to have a lingering claim in the justice system. But as a society, we're not really taught how to resolve disputes very well. We have a hard time having difficult conversations with neighbors. We don't know how to write letters that sound formal or may have some legal language, so we're really trying to give people those tools. And we think that, even without the tribunal, would help strengthen civil society.

Jon: What kind of things on the condo side are people filing? Is it tenant or owner to owner? Or is it your stereo's too loud, or your dog is barking?

Shannon Salter: It's really all of the above. Most disputes are between condominium boards and owners. But it can also be disputes between owners over noise, or pets, or other things like that. It's complicated because these are really little neighborhoods where people have to share resources, agree on priorities like a budget, paint color for the hallway. How loud is too loud? And so these disputes are really varied, but they tend to be the kind of irritations that people have when they live together in close quarters.

Jon: Unbelievable. I love the fact that you talk about some artificial intelligence. Where did that come from? Tell us more about that because that's ... I mean, having an online tool where people can go and get binding decisions, amazing. And then you're layering on some really advanced tech on top of that.

Shannon Salter: Yeah. The idea of an expert system has been around for quite a long time, and we were really lucky to have Darren Thompson with the Ministry of Justice working on this. And he did a master's in dispute resolution on expert systems, and is probably one of the leading ODR experts in Canada. So we had a lot of expertise to draw on. But the idea is that most people don't want to read 20 pages on condo law. They want a very specific answer to their very specific problem, which you can give them if you ask some questions first, and then give them plain language tools. So everything that we write for the tribunal, whether it's a decision at the end, or the solution explorer content at the front end, is meant to be written at about a grade six reading level so that it's really simple and easy to use for people.

Jon: That's why it resonated with me. But you know, when I watched the solution explorer video, I was really impressed because governments tend to talk to people like they're talking to other governments. I don't know where the language comes from. I mean, for me, I have my Master's in English, and so as a writer I always find it really disconcerting, if you will, when I'm looking at stuff, I don't understand what you're talking about. Why don't you talk to me like a person?

Shannon Salter: Right. And if you can't understand it, imagine how somebody feels who doesn't speak English as a first language, or didn't finish high school, for example. So evidence tells us you have to direct information at about a grade six reading level to make it understandable.

Jon: And I bet they're coming to the website under duress a little bit. Right? They have a problem, whether it's festering or it's new. They're vulnerable probably, and feeling a lot of stress. And then to go to a resource that talks up to me, that's even worse. I don't even know what to do, let alone, I don't understand what you're saying. So awesome, I was really impressed with how sympathetic and approachable the language was.

Shannon Salter: I'm glad to hear you say that. We often get people commenting that it doesn't look like a typical court or tribunal website, which I take as a compliment.

Jon: It doesn't.

Shannon Salter: Because, as you point out, a lot of court websites, but also forms and information, are designed without any user testing. So a lot of what we've been able to achieve in terms of making it clear is by actually going out and validating with the people who use it whether they understand what's being asked of them, how we can make it better. And then we survey people after they've been through the process to ask them some other questions. And we use that information to improve as well. 

Jon: It's a really important step, and hopefully people who are listening will take that seriously because one of the things ... You applied what sounds like a more Agile approach.

Shannon Salter: We have used Agile, both for the technology development. And the great thing about Agile is that built in there are breaks that you can use to go out and validate your assumptions. So we've developed a pretty stringent methodology for user testing, which we use not just for the technology, but also for our forms, our fee structure, our business processes.

Jon: Yeah. That's so important because you can have the most incredible, insightful solution, or technology, or product based on a relevant human need. Then you can totally botch it with the experience. So for me, the takeaway for people listening is, even when you have a great idea, you have to make sure you're designing it for the people you're using it for.

Shannon Salter: Absolutely. And I think in a public sector context, that can be more challenging.

Jon: It can.

Shannon Salter: I think there can be a perception that it's risky to user test, or that it might be embarrassing. And our view is always that you can either have these small failures along the way and allow yourself to course correct, keep your ego in check, keep the team really focused on user need, or you can have a giant failure at the end. And so we've really adopted that Silicon Valley approach of fail fast, fail often, fail forward. And it's worked out really well for us.

One of the sort of catch phrases we have around the tribunal is that we collect all this feedback through the website and through our front line staff, and we refer to those collections of feedback as treasure troves, which I think really sort of shows that we're not sensitive to criticism. We view it as an exciting opportunity that is valuable. And it's the key to improving.

Jon: Failure is not an option. Yes, it is.

Shannon Salter: Exactly, in a calculated, thoughtful way.

Jon: Let's talk about change management as being one of the driving forces around adoption. Tell me, how did you do it? What did you do? Who was it with? How did you fail and how did you improve?

Shannon Salter: My background is as a lawyer, and then I've also sat as a tribunal member as a decision maker in tribunals, but I had no experience or training in change management. It was one of the things the surprised me when I was appointed, how much change management there was to do because I realized that unless we could bring along stakeholders, that the project was not going to be successful.

But I also had a wide definition of who our stakeholders were, and they weren't just lawyers. It was also, most importantly, the public generally. But also even more importantly than that, community legal advocates who represent vulnerable people in our society. They're the front lines, and they know how badly the legal system can work sometimes for people who have had these barriers.

My view, without any knowledge or expertise in the area, was that the best thing to do was to talk to everybody I could and listen as much as I could. I think there tends to be a bit of a fight or flight response sometimes with projects like this where any institutional or government entity that's trying to introduce a project will either get very defensive and not really listen, or just not engage at all, sort of this flight mechanism. My view was that there was a better way, and the better way was to invite yourself into somebody's living room, metaphorically, for a cup of tea and just talk, and find the common ground where you can.

I started with community advocates and asked them what things they would like to see, given the blank slate that we had. A lot of their feedback was ... they weren't asking for million dollar things. They were asking for absolutely doable things, like can we have staff that are culturally competent? Can we have a direct line to somebody who has authority if their client is falling through the cracks? Things that we've implemented, that were actually not very expensive or difficult to do at all.

I think a lot of it is about being honest and being willing to listen. Being candid, not shying away from difficult questions. But it also takes a lot of time. 

Jon: Once people got on board with it and really understood the impact this could have for citizens, did they stand up and applaud?

Shannon Salter: There was always a lot of supportive members of the public when they became aware of it. We were lucky because the condominium community was very engaged and they are very knowledgeable and well informed. We would have community meetings where 200 or 300 people would show up on a Tuesday night. That was great, a lot of engagement there.

I think with lawyers, even though I have talked about the change resistance and I've been hard on them, I think with them too, when you explain how this is gonna improve access to justice, they did largely get on board. I think that's because lawyers, for the most part, are very committed to access to justice. They are quite idealistic in a lot of ways, but they need to be persuaded.

Jon: That's great. Access is huge. I'm curious about the vulnerable and access.

For people who are less tech savvy, for people who are vulnerable or don't have access to tech, how are you serving them still?

Shannon Salter: Yeah. I spend a lot of my time really focusing my energies on people who would have these issues or may have these issues. The vast majority of people are fine. You put a tablet or a smart phone in front of them, and you make the technology intuitive, and they know what to do, and they're off to the races.

We thought there would be about five or 10% of people who would not use the online technology, based on our research. One thing that surprised us was that now out of almost 6,000 disputes, which by definition have at least one person on each side, we've only had about 10 people ask not to use email, which is the default communication method.

Despite that, you're right, people can engage in a variety of different ways. Most, over 99% of people, use the online technology. But we all have mail based services, telephone, fax, in-person help at 62 service points around the province. I saw you laugh when I mentioned fax. Fax is the real F-word. We don't like faxes, but we do accept them.

Jon: Fax ... I want that on a T-shirt. Fax is an F-

Shannon Salter: Not failure. Failure is not an F-word for us. But fax is.

But nonetheless, we do accept faxes. What surprised us is the massive demand for online services. We get about four paper forms a month, out of about 500 disputes a month. What that's telling me is that people would rather sit down with a friend or family member, fill out a really simple form. They'd rather do that than even go to the post office and line up for a stamp, which is a pretty good validation of well-designed online technology.

Jon: When thinking about change management or resisting adoption, just because we're offering an online service or an online channel, does not negate other channels, it's incremental. I think that's what a lot of people have to get their heads around as well, is that we're not necessarily shutting down other stuff, we're just opening more. We're giving more access.

Shannon Salter: You'd be surprised how often I heard that argument before we opened, that not 100% of people are online, therefore we should offer zero online services. It doesn't make sense logically, or in any other way. I think we do have a responsibility as a part of the public justice system to make sure that nobody is left behind. But you're right, that multi-channel is the solution for that.

Jon: Yeah, difficult is worth doing. That's one of my favorite lines. It might be hard, but the end result is worth it. The Civil Resolution Tribunal is amazing for citizens. The access is incredible. What kind of impact has it had for staff, for people internally?

Shannon Salter: We have an incredible team. I think part of that is we had the blank slate. I was lucky enough to be able to hire my second-in-charge, Richard Rogers, and the key exec team. They in turn hired their own staff and the front line staff. It's really remarkable.

We do a lot of things to make sure our staff feel satisfied in their work. One is that about 80 to 90 percent of our staff work remotely. That has allowed us to recruit some exceptional talent that just needs a bit of flexibility in their life. That's been great.

We're also really engaged with our front line staff. These are the people who engage with the public, either through the submissions that they sent in, or the telephone. Because most of the heavy lifting is done online, they're not sitting there doing data entry. They tend to spend a lot of time on the phone with people who would otherwise slip through the cracks. They're doing higher value work. We also, because we're so new, really rely on them for their front line experience. They're the most valuable source of what's going on for the public and the tribunal.

They have their own agile systems that they've developed, including a success wall. They have a huddle board and a success wall. When they identify a problem, they can escalate it to me and the executive team really, really quickly. The exec team meets every week or two, to review change requests from staff, or through the public, through the website. We triage those changes and implement them in a really short cycle. The front line staff are not living with annoying things for a long period of time.

Jon: I love that. One of the things that I think is really important for people thinking about innovation, especially in public sector, is scale. You talked about condo disputes, you've talked about small claims up to 5,000, you mentioned, we're bringing in automobile disputes. Amazing. Obviously there's some traction, there's some scale. Where do you see this going? How big can it get? Do you see it going from BC across Canada?

Shannon Salter: Yeah. I think one of the interesting things about online dispute resolution and one of the interesting things for us being a leader in this area is that we just don't know what the limits are yet. I think it was very smart for the provincial government to have started with condominium disputes, and then small claims disputes because while these are important issues for the people who have them, they're not life or death issues. Nobody is going to jail or losing their kids because of these kinds of issues. It's a perfect area to carefully, thoughtfully, incrementally experiment and try something new, and figure out what works.

We've gotten pretty good at implementing new areas of jurisdiction and scaling up. Condo disputes are about 500 or 600 a year. Small claims are about 5,000 to 6,000 a year. We know that there will be a multiple of that for motor vehicle disputes as well. I think there's huge potential here for other areas of law too, and the one that comes to mind most readily is family law.

If you think about family law, people going to court spend a huge amount of time and money through a really adversarial process. It's emotionally devastating. The tools that the court system have are pretty limited. Bringing the justice system to families who are going through separation and divorce, allowing them to engage on their time, doing it as collaboratively and consensually as possible, might yield a kinder, gentler, more humane process that's easier on kids, that's easier on the pocket book, and that's easier on the participants through a really difficult time in their lives.

Jon: Amazing. I love the idea of it being more ... humane is not really the word, but more gentle, not only on peoples' emotional state, but financially. Vancouver is one of the leading smart cities in the world. It's amazing that such a fundamental shift in the justice system is happening here. What is it about BC that is driving these innovations?

Shannon Salter: I'd really be speculating here but I think it might have something to do with the fact that we're a relatively young province. There's certainly traditions but they may a little less entrenched then they are in other parts of Canada or maybe even other parts of the world. It certainly does help to have a really strong tech sector and normalizing the idea of innovation.

In the private sector I think naturally bleeds into the public sector, but I do think a lot of this is personality driven. And I see this in other jurisdictions trying to innovate around the world too, that a lot seems to change on just having, or turn on, having the right people in the right places at the right time. So again, I tip my hat again to this innovative group within the ministry of justice which was really before it's time in terms of having some of these ideas. And they just had an incredibly diverse multi-disciplinary group of people who drove this forward. And we sort of picked up the ball and kept it going as well. So it's a very fascinating question, how much is situational? How much is contextual? And I'm not really sure how to apportion that, but I do agree special.

Jon: Someone will write a paper on it eventually.

Shannon Salter: Yes after you have enough data hopefully.

Jon: Right. It's like what is it about, it's something in the water ...

Shannon Salter: Something ... I was going to say that.

Jon: Typically in innovation it's not a one hit wonder. How do you stay ahead of the game and continue to improve? Especially considering your leading position in the industry, you don't want to rest on your laurels. You've made a splash, how do you continue?

Shannon Salter: I think in part the answer for us is a culture of continuous improvement. And that involves sticking our head up every now and again and watching what's happening in the world. And then internally, constantly reevaluating, constantly shifting, constantly adjusting I think does keep us ahead of the game and closely tied to what it is people want and need.

And there's a couple of exciting areas that we're looking at I think moving forward. One is really harnessing the power of all of the data we're able to collect and looking at data analytics to improve our processes. We've already done this in a lot of ways but we're continuing to refine that.

Jon: I love the idea, even just fundamentally about self-serve. It's so intrinsic into how we live our lives now. I go to Amazon, I go to Apple, I do all these things, I go to Craigslist or whatever. I'm actually in the driver's seat as the "consumer." And then I get to government and I hit a wall. Or I used to hit a wall. How do you deliver services to Canadians through digital? They want it, they need it and as government, we need them to need it. 

Shannon Salter: Right.

Jon: Because we spend an inordinate amount of time, resources, money, serving people face to face when it doesn't need to be.

Shannon Salter: And they don't want to do that, and you're right that taxpayers don't want to pay for the government to do that. I think that's right. Nothing about this is particularly surprising to members of the public. When you talk to them they're like, "Yeah, why isn't it that way already?" There's no shock or surprise, there's just a general consensus that it's a good idea and they give it a big thumbs up. So they're not the sticking point there, but the challenge of course is to design technology and processes for them that match their expectations.

So one of the key takeaways from all our user testing was that the more we could make the technology look like things people are already doing online, the easier it was going to be for them to use, the less anxiety it was going to cause them, the more they were likely to jump in with both feet. So you talked about our website, but we know from some of the research we commissioned that 92 percent of people in BC are online every day. The things they're doing are what we're all doing. They're buying stuff, they're Googling stuff, they're using social media, they're emailing and they're texting. And so the negotiation platform looks like a chat room, the solution explorer looks like buying things, it's radio buttons and clicking things. And the forum even looks like buying something from Amazon or WalMart. So I agree with you, it's again a design challenge, but it's not the public that is throwing obstacles in the way for changing the way that the justice system works.

Jon: What advice would you have for people, companies, about V2R and potentially applying for V2R in 2019?

Shannon Salter: Well, my advice to everybody for everything is always to apply for everything. It was a relatively straightforward application process and an incredible group of nominees but I think there's so much talent that goes unrecognized and these incredible projects that don't go, that go unrecognized as well. So I guess my advice would be simple, go for it. 

Jon: So that's it for today's podcast. Thanks so much everybody for listening. Shannon, thank you so much for sharing the story about the tribunal and how you've taken the justice system and brought it to people. I really do think that you've set the bar for other people and I think it's sort of typical, like you said, lawyer justice system, there's a precedent now. And I think if you guys can show that it can be done, there's so many other opportunities for other organizations to take that online which is great. Thanks so much for sharing your story with us. I think it's super-inspiring and hopefully people listening got lots out of it. Stay tuned for more upcoming episodes in our “Innovation Series” featuring other V2R winners. That’s it for now so see you next time.

Shannon Salter: Thanks very much, John.

Jon: Thanks for listening to this episode of Shift. You can get more details at PwC.com/CA/Shift. If you enjoyed this episode and want to hear more, subscribe to our podcast series. You can find us on iTunes, Google Play or your preferred podcast platform. Just so you know, this podcast has been prepared by PricewaterhouseCoopers, LLP, an Ontario Limited liability partnership for general guidance on matters of interest only and does not constitute professional advice. Until next time.

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