Digital transformation is brewing at Heineken

The mission of Heineken’s “digital and technology” department is to provide “data at our fingertips”, according to Elizabeth Osta, the company’s director of data management. The hope is for employees, partners and customers to have easy access to the data they need – within policy and regulatory frameworks, of course.

Osta’s job is to ensure that data is of good quality, that it is consistent, and that it is in a standard format. She provides data governance, which will allow the company to meet its objectives of AI adoption, increased automation, and transformation of business processes. Osta reports to the chief digital & technology officer.

“My position is equal to a chief data officer,” Osta explained to Computer Weekly at the event. “It was established two years ago with the official start of digital transformation at Heineken. The history of the role began in 2004, when Yahoo! invented the position and appointed Usama Fayyad, who was one of my former bosses. Since then, the role of data has grown in importance in virtually every company, so most organisations now have a chief data officer position or equivalent.”

A new flavour of digital transformation

As is the case with most companies that have chosen to undergo a digital transformation, Heineken is seeking to modernise and simplify at the same time, and sees the transformation as a multi-year undertaking.

In her presentation, Osta said that for Heineken, digital transformation is all about making it easier for customers and supply chain partners to work with the company. To this end, Osta and her colleagues are “reimagining” their business processes to use some of the latest technologies. The hope is to make Heineken the best-connected brewer.

“My advice to other companies wanting to undergo digital transformation would be to look at the four Cs: customer, resilience to crisis, climate, colleagues”

“A little over 10 years ago, working in digital and technology was all about apps,” Osta told Computer Weekly after her presentation. “Very shortly after, it became all about instant services and connecting buyers and sellers. At that moment, there was the realisation that this could not happen without solid data and well-architected technology landscapes. In many companies, the digital teams were isolated, which made it difficult to fulfil instant services. In our company, we make sure digital, data and tech all work together,” she said.

“My advice to other companies wanting to undergo digital transformation would be to look at the four Cs,” said Osta. “These are customer, resilience to crisis, climate, and colleagues. Identify the sources of value and develop both short- and long-term plans to look for ways to transform the company in stages.”

During the coronavirus pandemic, the role of digital technology became critical, enabling people to work from home and to communicate with colleagues, partners and customers using a set of collaborative tools. The choice of tools was important – and Heineken experimented with metaverse tools.

During the lockdown in Malaysia, Malaysians couldn’t go out to get their favourite street food. Using the metaverse, Heineken replicated the experience of street food and added features to order food and beer and have it delivered at home. Another example of the use of these tools was the recent launch of Heineken Silver in Europe, which took place in the metaverse as a way of emphasising the importance of enjoying beer in real life.

Heineken assumes that artificial intelligence (AI) will be increasingly critical to the company’s success and is eager to use it wherever it makes sense. The company’s attitude is that the best path to adoption of any new technology is to apply it in ways that provide immediate value.

“We have used several AI-driven products at different parts of our value chain and these products have immediately produced results,” said Osta. “On a global level, we look for the most promising technologies and how we can scale them to our needs. At the same time, we encourage innovation locally.”

Osta gave a few examples of Heineken’s use of artificial intelligence: “We are using AI to predict the colour of the beer in production. We are using AI to support our salesforce with a range of recommendations – including optimal routes, the best sequence of customer visits, and to assortment proposals.  We are using AI to take pictures in markets where there is a fragmented trade or bar fridges and send planogram suggestions for optimisation. We are using AI to predict availability of kegs. And we are using AI to predict financial cash flows.”

Digital transformation keeps sustainability on tap

Heineken says it is fully committed to the path to net zero – and that there are efforts around the organisation to achieve this goal. Sustainability is top of mind in the strategies and tactics for digital transformation.

“We have several fully green breweries,” said Osta. “This started in Austria a few years back with Goesser and is now being replicated in markets including France and Brazil. We also have 3D printers in 40 breweries, with 25 more in plan for this year. 3D printing on-site is very effective when it comes to spare parts management as it reduces carbon emissions.

“There is also an incredible effort being made on the data side in terms of what we can estimate and measure. We are always looking at emerging data standards for better quality data to exchange across the ecosystem with our suppliers. The challenge is that often in sustainability we are faced with dark data – data that is critical but not collected or visible.

“The corporate value chain (Scope 3) reporting requires an ecosystem approach of data exchange. We have started with the initial first steps with our vendors, ensuring we can access critical production data. We are also looking at more effective data exchange with retailers. And of course, there is a lot of work going on to ensure we capture every step in our internal value chain.”

One of the objectives of digital transformation is to increase communication among supply chain partners. Heineken hopes that the foundation it is now laying will make it much easier to do the reporting that will be required in the near future.