What drives an enterprise’s decision to embark on a digital transformation journey? And what were the insights gleaned and challenges overcome along the way? We put these questions and more to Hans van der Waal, Global IT director at Travelex, in our recent “Talking Out Cloud” leadership chat series.
With a wealth of experience in modernizing various platforms in different contexts, and a keen interest in automating repeatable tasks and interactions to make businesses more seamless and integrated, Hans shared his observations on Travelex’s unique digital transformation strategy.
#1 What were the drivers behind further investment in digital transformation and how did the company prioritize its areas of focus?
At Travelex, we are providing foreign currency to travelers, whether directly or through our ecosystem with third parties. Our business performance is very much dependent on people traveling. And as you can imagine, during 2020-21 and into 2022 there was not much travel due to the global pandemic, so Travelex was quite badly impacted.
Despite that, we started to embark on our large-scale cloud migration journey and those two actually come together in a way, because we used that window of time to try and simplify our organization. We decided what we could stop, what we could decommission or retire, and how we could optimize our ongoing balance sheet – and cloud is fundamental for that.
So, we started to arrive at a program where we actually moved workloads from our own data centers (with ongoing challenges of maintenance, support, and security) to a cloud environment. Strategically, this approach would help us lay a foundation where we can invest in more specific agility for our product development and put product development at the core of our mission: to help our customers and to fundamentally change the way we use data.
With data really driving the business, being able to leverage data analytics, with machine learning and AI, that was fundamental to us, not just to benefit economically but also to further develop on our journey.
How we prioritized was very much based on our business strategy, to digitize customer interactions. For example, we currently have our physical environment where we interact with customers; a lot of customers will come into our stores and make an ad hoc transaction or currency exchange but then they leave and we don’t know who they are. That means it’s difficult to incentivize repeat customer transactions, or understand how we can help our customers make the right decision for their next journey, etc.
So, by digitizing the customer interaction we could create a relationship with customers, and then that relationship helps us to provide more specific products and specific customer experiences. That will then also help to drive the business, so our transformation was very much based on achieving that large goal.
#2 What challenges did you face during this digital transformation and how did you overcome those obstacles?
There are many challenges in digital transformation: some of it is the culture, resistance in your organization, or around the economics i.e. how much can you spend upfront to make it work. On the technology side of things there might also be challenges, so a crucial part of the journey is actually to understand all your assets, all your configuration items in ideal terms, and interconnectivity i.e. what ‘system’ talks to what about what.
So understanding how our system interacts on what level, with what sort of driver behind it, you can actually embed those justified interactions and the existing interface into your security and block everything else. This was a challenge because we didn’t have a very strong asset register, and also what was needed was the individual access points for individual systems and users on an IP level. We had to do a lot of discovery of our own environment before we could actually start to make smart moves of our infrastructure.
Another challenge are platforms in Travelex that are no longer supported by the provider. If you want to touch end-of-service-life systems or the components, then it’s generating more complexity when migrating because you don’t want systems to be falling over. At that point there is a certain level of what our cloud provider could or could not support.
In our particular case, the pandemic gave us certain business challenges as well since we had people in our business on mandatory leave or furlough. That doesn’t help if you want to make a big transformation because there were certain areas in the business that we couldn’t reach.
And then there’s challenges around how to migrate data securely to the cloud, and ensure 100% of the data on-prem is replicated to the destination without any change or manipulation along the way. Since our data is the implicit part of the product, using Amazon cloud tools helped us to convince the business and achieve our goal.
We decided to migrate our lower environments first, using a test environment for development, and learn from that process to understand the boundaries of what we could and could not migrate. Based on these insights, only then would we migrate to a production environment. For example, we discovered that there were certain platforms that we just had to leave on-prem or that needed to be modernized first before we could migrate.
#3 How did Travelex balance the need to maintain the traditional channels, such as the physical storefronts?
Our core strength is probably our brand. Globally, a lot of people know Travelex and that’s because they come across Travelex everywhere. Our physical presence is key because that’s our distribution, where we meet our customers in our stores. So, what we are aiming for with digital is that it is complementary to our key assets, i.e. our distribution, our brand, our channel, our staff in our stores, and not to replace that.
So we’re not saying by introducing digital channels we’re making all of the distribution obsolete because that’s our current strength – we definitely embrace our presence in the stores and our interaction with customers. We are aiming to make our product development a function of improving customer onboarding and improving the transformation from anonymous to an actual relationship. It’s about improving how we can support our customers to choose the best product for them and give them a seamless travel experience.
#4 What will be next for innovation at Travelex to support its goals?
It’s very much around that conversion of ‘anonymous’ to a ‘relationship’ – that’s where we are investing most. So if you look at things in terms of airport travelers, for instance, there are also requirements from a compliance perspective when checking if we know the customer. For example, is the customer blacklisted or sanctioned by a particular government, or perhaps there are requirements around certain politically exposed individuals.
So, there are a lot of compliance checks that we need to do, and we can combine that in a way that optimizes customer transactions so that it goes faster. It means we remain compliant with ongoing regulations while we start to build that relationship. The technology that goes into scanning, identification using OCR to capture certain details, doing online background checks can then be combined with data that we get from third-party ecosystems, e.g., boarding cards.
We can optimize their journey by expanding our understanding of where our customers come from, where they go, what sort of travel products they use (prepaid cards or cash), whether they use over-the-counter, call centers, or ATMs, etc. We can understand where and how we can influence their travel experience in a way that benefits the customer, and at the same time ensure our business is servicing their needs.
And for that there’s a combination of Amazon products because our data platform is very much developed on Amazon and AWS technology. So what we’re building is fundamental to that sort of strategy, things like Amazon Lake Formation, Amazon Redshift, and other components are part of this.
#5 What was your experience like working with the SourceFuse team?
SourceFuse was actually an interesting new relationship that we started to embark on. And, I must also say, a lot of praise goes to Amazon for making that connection because they helped us to identify your strengths and how we could sync up with each other in a way that we could both benefit.
We come across quite a number of historical third party relationships that continue to help us with things. We also get introduced to new third parties, a lot of cold sales calls as well happening in this world! But SourceFuse helped us to understand the opportunities to further benefit from cloud technology.
What I like about SourceFuse Is that there’s a very low threshold of being in contact and they don’t bother me too much. They are not frustrating me with ongoing demands for my time or attention because that would be annoying. Everyone is after what sort of budget we have, and how much more can we get out of this organization or this individual – and that’s not what SourceFuse does.
Your team seeks interaction if you think Travelex could benefit from something, because that’s what you’ve seen from other customers, asking us what we think about it ourselves. Also if there’s a way that we can start to demonstrate things.
So it’s very low thresholds of contact, but very smart as well because they come up with the right sort of ideas at the right time which all match up. If they continue to do that, then I think that this is going to become a very interesting bidirectional relationship.