Text: Editorial staff “ceo” | Images: Marc Wetli | Magazine: Trust in the Digital Age – December 2017
#firm #determined #modest
Herbert Bolliger, Chairman of the Executive Board of the Federation of Migros Cooperatives (Migros-Genossenschaftsbund), has spent almost his entire career in the service of Switzerland’s largest retail company. And informatics has accompanied him right from the start. As an economist, he considers the rapidly growing online business to be one of the greatest challenges for the merchandising industry. To his way of thinking, voice control and the secure handling of sensitive data are the core issues when it comes to digital transformation.
Which three words do you immediately associate with the term “Trust”?
Honesty, reliability and transparency.
How important to you is trust as it pertains to your daily work?
I believe trust is the make-or-break factor for collaboration within an organisation. It’s absolutely crucial to the company’s success. In an age where everything is becoming faster and information is available to everyone at the twitch of a finger, trust is more important than ever before.
Migros is considered one of the most trustworthy brands in Switzerland. How can this prowess be maintained, and what could threaten it?
That’s a major, never-ending challenge for us. We need to meet the expectations of our customers and keep the promises we’ve made to them. Care and commitment are key in this regard. Of course we, too, make the occasional mistake. But when that happens, immediate and frank communication is called for. In the end, that kind of transparency engenders trust.
“The boundaries between stationary and online commerce are dissipating steadily.”
As one of the country’s largest employers, you and thousands of supervisors must have tremendous trust in your personnel. How do you achieve and perpetuate a trust-based corporate culture?
The worthy values Migros founder Gottlieb Duttweiler defined at the time induce trust and offer guidance. And we repeatedly draw on those values. Our managers have to know them and personify them. We also nurture a collaborative management style and work on critical issues in mixed, inclusive teams. With its very large number of autonomous firms, Migros isn’t the kind of hierarchically structured company that can be managed top-down.
Digitisation will also not stop short of the retail industry. In which ways is it changing your business?
The digital transformation is something I view as a permanent process with myriad facets. The boundaries between stationary and online commerce are dissipating steadily. These days, customers have so many ways to do their shopping: they can buy items online, return them at the store; or they can browse through items online and then buy them at the store – whatever works best for them. But for us, this represents a Herculean task in terms of logistics. The products need to be physically moved from one place to another, and this at an ever-faster pace and just in time.
Herbert Bolliger has been Chairman of the Executive Board of the Federation of Migros Cooperatives (Migros-Genossenschaftsbund, MGB) since the middle of 2005. Earlier, he headed the MGB Aare Cooperative. The 64-year-old has worked for Migros almost his entire professional life, having joined the company in 1983. During Bolliger’s time in office, Migros acquired a variety of companies, including Denner (retail discounter), Schild (fashion retailer) and the Digitec/Galaxus online portals. Bolliger is scheduled to retire shortly and will hand over his office to Fabrice Zumbrunnen. A graduate in economics and business administration from the University of Zurich, Bolliger is married, has two adult children and lives in Wettingen (AG).
Which disruptive technologies do you expect to see invade the retail business farther down the road, and how do you intend to deal with them?
Speech recognition and voice control. Already today there are devices you can give instructions to. And in the future, all you’ll have to say is: “Go shopping and fill up the fridge.” Robots will attend to the simple, repetitive tasks around the house. They’ll take on human characteristics and work shoulder-to-shoulder with us.
With LeShop, Galaxus and Digitec, Migros is also expanding aggressively into the online space. But the revenue shares of those portals are still rather modest. Do consumers lack faith in this way of shopping?
No, the overall trend is advancing at breakneck speed and is unstoppable. But there are major variances amongst the product groups because of their specific nature. In the case of food, where freshness and proximate supply count the most and logistics is a challenge, the market share of roughly 1.8% is still quite small. But Switzerland is covered by a very dense network of retail outlets. In other areas – take for example home electronics – the market share is already a good 30%, and the media content from Ex Libris is even above 50%. Textiles as well are making strong gains at present. But it’s not a matter of either/or – today, many consumers take a mixed approach. They look at an in-store article and then order it online for delivery at home. And they want to communicate with the company, even via social media.
In your opinion, what weighs more: the risks or the opportunities associated with digital progress?
Quite clearly the opportunities. The possibilities are endless; the risks calculable. Information is to be had everywhere, anytime; convenience and ease are important drivers. There is tremendous potential for automation and the use of artificial intelligence in the production, processing and packaging areas. At companies, it simply takes the will to change and adapt to the rapid pace. But one shouldn’t lose sight of the fears amongst the public that can be sparked by these sudden changes and thereby evoke resistance to the new.
“IT security is a permanent challenge. Just recently we’ve reinforced our in-house IT unit in an effort to be better protected against cyber criminality.”
Which areas of your personal life have been changed the most by the digital transition?
One’s constant availability, the intense virtual interaction with others, the enormous mass of information and the sheer speed at which it’s disseminated – all of this has changed daily life, mine included.
How high up on your agenda are the matters of Trust and Security?
Way up! They’re essential to the reputation of a company like Migros. IT security is a permanent challenge. I like to compare those investments to the ones made in connection with the arms race during the Cold War. Just recently we’ve reinforced our in-house IT unit in effort to be better protected against cyber criminality. What worries me is the destructive energy that drives many of these hackers as they go about their tampering. We, too, have been a victim of cyber attacks. They were very disturbing and caused considerable damage. What’s important in such cases is to react immediately and communicate transparently.
Thanks to its Cumulus programme, Migros has very precise data on the purchasing proclivities of its customers. How do you deal with the security and privacy concerns of your customers when it comes to handling that data?
Data security has been the top priority from the very first day of our Cumulus card. Trust is cemented through the prudent handling of data, open communication and transparency. An example: If for any reason we need to recall an item, the Cumulus database enables us to know who bought the product when and where, so we can get in direct contact with those customers. This, of course, is greatly appreciated.
The Migros Group, which is organised as a cooperative, generated in 2016 total revenues of Swiss francs 27.7 billion, 6.5% of which were attributable to its online business. With a workforce of more than 100,000, Migros is not only Switzerland’s largest retailer, but also its largest private-sector employer.
How do you manage to keep your pipeline full of new, innovative products and services?
We keep our finger on the pulse of the times by staying in touch with many sources. For instance, we have a regular exchange with experts from the Gottlieb Duttweiler Institute, GDI, who focus on trends of the future. We’re also involved in the Digital Switzerland initiative and were amongst the first patrons of Impact Hub Zurich, which offers an initial home to start-ups. We seek contact with young companies and make the most out of our collaborations with the ETH and University of St. Gallen, for example in the areas of digital and sustainable commerce. Moreover, there are “Migros World” innovation teams in each of our business segments. The decisive thing, of course, is to pick and choose the best out of these countless ideas and run with them in the form of concrete projects.
In your opinion, how should managers sensibly navigate the (digital) world of work?
Each of them, including the top guns, should continuously acquire deeper know-how in the field of digitisation. We need to give thought as to how the workplace of the future will look and which paths we can take to communicate with our people. In sales, for instance, employees don’t sit in front of a monitor. So to help them get the most important information from our intranet, we’ve developed a proprietary app – after all, everyone has a mobile phone these days.
Which means of communication do you use personally when interacting with your people?
It depends on the given situation: via SMS if it has to go fast or if I’m on the move. In the office, I naturally take care of many things via email. But I much prefer the phone when open questions need to be addressed – it avoids the tedious back-and-forth. And of course when time permits and I can quickly drop by the person’s office, I appreciate the face-to-face encounter.
We’re all constantly online and reachable. How important to you are offline oases?
At the weekend or on holidays, I intentionally “lose” my phone. Most of the stuff that comes in is not so important that it can’t wait until Monday. But granted, on holidays I do take maybe an hour a day to check my mails so that I’m not faced with a mountain of messages when I get back to the office.
After almost 30 years of service to Migros, you’ll soon be passing the torch to your successor, Fabrice Zumbrunnen. What then? What are your plans and what will you miss?
I can look back gratefully and with satisfaction on a very wonderful time. I’ll certainly miss the many contacts and encounters – obviously, there’ll be a lot fewer of them. And if there’s one plan I have for the future, it’s not to plan. The word will be stricken from my vocabulary.
Short questions – short answers
Which question haven’t we asked that you’d still like to answer?
“Why is Migros so successful?” It’s a question I almost never hear. The answer is: because we take to heart the wishes and concerns of our customers. Because we’re honest, reliable and transparent.
“Trust is good; control is better” – what do you think about this maxim?
It’s correct; I already liked to use it in the army. But the control aspect needs to be applied situationally; with some people, it suffices when you take a closer look once a year; with others, you’re better off doing it daily.
Which smartphone app is your favourite?
A little programme that warns me of oncoming speed traps. But it’s useless in the city – the cursed thing bleeps all the time because there are so many radars.
Can you remember your first mobile phone? Which model was it?
It has to have been a Nokia; probably the “Stone Age” model.