Rana Nawas: (00:00)
Hello Ladies and gents, my guest on today’s show is an extraordinary woman and the chief marketing officer of IBM, Michelle Peluso reports to the CEO of IBM and oversees the company’s global marketing and brand initiatives, strategy and execution. From 2009 to 2013, Michelle was the consumer chief marketing and Internet officer of Citi Group where she was responsible for the digital experience of Citi’s 100 million consumers globally. From 2003 to 2009, Michelle was the CEO of Travelocity. She currently serves on several boards, including that of Nike. We had a far ranging discussion from lifestyle to ai to ethics to inclusion. I wondered how Michelle and her corporate global role manages to leave the office, mostly at 5:00 PM. We talked about the abundance of data and communication channels and how these two factors affect modern marketing. We explored the role of artificial intelligence and blockchain in democratizing marketing and we highlighted the critical role that male sponsors and allies play in helping women rise. As Michelle kindly dialed in from New York, the audio is not as it would be in a live recording now. Let’s get into it. Michelle, I am thrilled to have you on When Women Win. Thank you so much for making the time.

Michelle Peluso: (01:28)
Thank you Rana. I’m thrilled to be here. What is important topic for all of us?

Rana Nawas: (01:33)
Brilliant. So IBM is a 107 year old company with over 380,000 people globally and you run the marketing function globally. Now you leave the office every day at 5:00 PM without exception. Now, there’s a lot of remarkable facts about you, but this is what I wanted to start with. How did you make that happen?

Michelle Peluso: (01:56)
Well, listen, it’s most days at 5:00 PM, just to be clear, the vast majority I would say. You know, when I was a CEO of Travelocity many years ago, I was not married and I did not have kids. And so staying late in the office, you know, weekends in the office, that was all really fine. But then when I moved over to Citi Group, after the birth of my, my daughter, um, I started to realize that I didn’t, I wanted to be, of course the very attentive mom and I also was ambitious and wanted to have a big job. And what was really fascinating was pretty early in my tenure at Citi Group, I was asked by the president of the company if I would become the global chief marketing and digital officer for the consumer business. And um, I asked if I could have just 48 hours to think about the model, not about the job per se, but how I would do the job. And what I found was my predecessor, who was terrific, but she had read it in a very different, I would say almost a hub and spoke, you know, she was really the center and the countries and the regions where the spokes. And she was often on the road, often in different countries really, you know, going back and forth with each individual country. I thought about that and I thought, well, I think there’s a better way to do this for Citi Group, but I also did a better way to do this for me. And I started thinking a lot about what I call the cabinet model, which is to have a really strong regional, exact from each region, and we would function like a cabinet and we would together, be together and video every week. But then we would actually rotate once a quarter to each region. So all of us would go to Latin America. All of us would go to Europe, Middle East, all of us would go to Asia-Pac. All of us will go to North America, and each regional leader would be accountable for some global priorities. So it would be forced to see what the night sky looked like from the other side of the world. And I did that for the marketing part of my responsibility. I did that for the digital part of my responsibility. And all of a sudden it meant that I could really predict what my travel schedule would look like. But once I started to put the frame on what would my schedule look like, it gave me a lot more flexibility to say, okay, here’s how I’m going to run my day. It’s a global job, so I leave the office at five, I’ll be home for dinner and bath and bedtime. And then I would get back online at 8:00 at night at 7:30 at night when the kids would go to bed and I would work some evening hours, which was very helpful because it had so many of my employees were in Asia. So I think the most important thing I learned is, and I’ve carried that through, by the way, here at IBM. I think the most important thing I learned was number one, you really have to constantly be thinking about how you use your time and there’s not a week or month that goes by that I don’t think about how could I use my time better? Often on long flights, I’ll print my calendar from the past few months and I’ll look at it and I’ll say, what are the things that given the priorities I have for my family, for my office, you know, for work, for my community, am I using my time in a way that actually is consistent with what’s most important? And that changes all the time. And so I think being super conscious about how you use your time is really important. Secondly, I think actually having standards is helpful. My team knew that I would leave the office at five unless I had to be here for an important reason. But it would also know that I will be back online at 7:37, 45 and answer questions. They would also know that if I responded to them at 8:00 or 9:00 or 10:00 at night, my expectation was not that they were going to get back to me. I didn’t want them. I didn’t need them to work my hours. I just had to work the hours that worked for, for me and for my family. So consistency was quite helpful. I would say authenticity about it. I never tried to hide that I was leaving at five. You know, I never tried to sneak out the door and hope that nobody saw me. That’s what I did. Now I also worked evening hours and so that was the way I thought I could do my job really well and be the mom I wanted to be. So some of those things are some of the lessons I’ve learned on the path here, and of course all of it is underpinned by, you have to be, want to be exceptional at your job, and you also want to be an exceptional mom and wife for I do, you know, and, and member of the community. So, that authenticity and that sense of being a whole person each day I think is, I think it’s relatable to other people.

Rana Nawas: (06:45)
And for me, I think if you can do this in a global role, you can do it in a local or regional role, right? Like most of listeners. And if you know, if it works for a woman in, at your level, it can work for men too. So I’m all for extending this, being parent friendly or employee friendly, not just woman friendly. And what was interesting was it sounds like you went in with that right off the bat. You didn’t build up tenure at Citi, is that right?

Michelle Peluso: (07:10)
No, that’s right, I was pretty new at Citi when I was asked to take on this bigger job, I had not been there for a long time. And I had an incredibly supportive boss, Manuel Medina-Mora, who was the one of the two presidents of Citi Group, president of the consumer group. And he was really fantastic. I had a young baby and I was pregnant, so he was really fantastic about saying, how can you do this in a way, you know, you come back to me with how you can do this in a way that makes sense for you and for Citi. So, I think he always knew that, you know, when I was at work, he had, you know, every ounce of my passion and energy and ambition and commitment and execution, you know, a focus and prioritization, leadership. And when I was at home, you know, I was allowed to be a mom and everybody knew my number. It’s not like if there was something important that came up, of course, you know, but of course people could reach me and sometimes I had to violate my own schedule leaving at five to stay for something really important. No problem. But the vast majority of times I left the office at the same time and we sort of pick things back up after the kids went to bed.

Rana Nawas: (08:28)
And we’ll come back to the role of men in your life – male sponsors and male bosses who supported you along the way, for sure. But let’s just shift gears for a moment and talk about your job, if we may. What does the modern marketer do?

Michelle Peluso: (08:43)
Oh, it’s such a fun time to be a marketer. I was a CEO. And I guess it gives me an interesting perspective in the marketing job. And I would say the following things, I think it is so much about our profession is changing rapidly. We have most profoundly, much more access to data than ever before. We can communicate in much more personalized ways than ever before, and the channels that we participate in, particularly all the social channels, but even traditional channels, are much more real time than ever before, so it’s a more consumer centric, more data centric, more tech centric and more agile, you know, field than it ever has been and that has been, I think, fascinating for me because it allows the marketer, the modern marketer to have a bigger seat at the table. I go back to being a CEO. The modern marketer used to sort of take everything that was happening at the CEO table and figure out how to craft a message and broadcast it to the world. The new marketer is shaping those outcomes, is shaping what products and services accustomed, you know, the company should have given the deep rooted data and customer centric knowledge the marketer has. The new marketer of the modern marketer is able to adjust fast to work in agile ways to support the company. And so it’s really changed, I think the role of marketing and the role of the marketer at the CEO table.

Rana Nawas: (10:13)
You mentioned a lot of data that you’re essentially becoming a data scientist, you have these reams and reams of data, you know, what do we collect, what do we use, how accurate is it? To what extent does AI play a role in marketing?

Michelle Peluso: (10:27)
Well, I think that’s a really important question. I think there’s a couple of profound technologies that are affecting marketing, and the first one is AI, and of course at IBM, you know, being such a long standing champion and innovator in the space of AI, we think about this a lot. AI will affect the marketer in a couple of profound ways. First of all, it changes what information we can get about our consumers. All of a sudden we can analyze not just the written word, but tone and voice and personality and, whether that’s through chatbots and the call center, whether that’s interactions with our websites So there’s a lot more data we can glean about the customer because of AI. Secondly, it changes the way we can interact with customers. We have something called Watson ads, which are interactive ads. You can say, for instance, with the soup company, Campbell soup, what are the ingredients in your refrigerator? And the ad will craft you a recipe that makes sense, you know, with a soup recipe that makes sense given what you have in your refrigerator. So the notion of advertising being truly interactive and truly personalized is now possible with AI. The third thing, of course is, it’s changing the way we work. There’s so much data available to the average marketer, reams and reams and reams of data and it’s growing at an exponential rate, not a linear rate. And so we need AI to help make sense of this. For us, we have a real model of transparency, all of our marketers, and in fact any IBM-er can see the effectiveness of all of our campaigns. We have used digital dashboards. And what we do with Watson, is we provide our marketers with alerts. So you can come to work for your campaign, for the things you’re spending money on, for the programs you’re running. You can come in in the morning and get alerts on what part of the funnel is not performing as well as it should and what are some ideas and tips and places you might investigate based on other teams that are doing a better job in that part of the funnel. So we’re also using AI to help shape and augment what the marketer himself or herself can do. So that’s another big promising area, how Ai will continue to reinvent marketing. But beyond AI, the other technology that I’m very excited about as well is blockchain. And if you think about blockchain, a connecting sources of truth in a sometimes muddy supply chain, that’s actually very relevant for the media buying supply chain. About 10, 15 years ago, for every dollar that a marketer spent, a good 80 percent of it made its way in front of the actual customer. There were some tolls along the way. You have to pay your agency, you have to pay the media fees. But a large portion of that dollar actually went with the customer. Today, that number is only 45, 50 percent. And some argue, even only 40, because there are so many more tolls along the way, you’re paying your, you know, your, your DSP and your, your data management platform and your agencies and your ad blockers and trackers and your mobile optimizers. There’s so many tolls along the way. And what does that mean? It means one less of your money is actually being seen by the customer. Two, there’s a lot of complexity and reconciliation. You can imagine when there’s that many parties involved with every dollar spent. And three, you don’t always know where your ads are appearing, which creates brand safety and reputation issues. So I think what blockchain can do for media buying what it is already starting to do for areas like food trust. Similarly complex things. How does a tomato grown, you know, somewhere in Africa and make its way to a store, you know, in Walmart, in, in Sacramento, California. So these notions of these complicated supply chains can be transformed with an immutable record between all the parties, a trusted transaction. And I think blockchain can do for media buying what it is starting to do for other professions.

Rana Nawas: (14:36)
And what are the implications for someone like me, just your average person being marketed to. So I get all the advantages to marketers and media buying. But what about me? What’s in it for me?

Michelle Peluso: (14:50)
Yes. Well for you, Rana. I think there’s a lot of advantages. All of us want more relevant ads. No, we don’t want to see things that aren’t relevant to us. Vast majority of people are happy to get targeted information if it is relevant. And so to the extent that AI can help make ads more relevant, that’s important too. And that’s because we’re learning more information about what you really want and what you really intend as opposed to just what you searched for last. Secondly, I think we all love engaging, entertaining ads, more than we love, you know, sort of static. So to the extent that you can look in your refrigerator and you can say, here’s what I have in the fridge, what, you know, what should I make tonight – what soup can I make tonight? Those are kind of fun ways to think in a much more interactive way about what’s possible. You can imagine the same thing with sneakers, you know, or, or really any, any of the things you buy every day. So, I think being more relevant and being more interactive. And then finally, I think the last piece is actually getting problems solved and what I would call an asynchronous way. So if you’re a consumer today, by and large, if you have a problem, you call a call center and you wait on hold and wait on hold and you’d get your issue resolved, or maybe use chat, but again the same thing, you have to stay on the line. You’ve got to be interacting with that one particular agent. AI, from a service perspective, breaks that, breaks that so you can start a chat with a AI driven chatbot, and you can get so far and then you can say, well, I’ve got to stop and take the kids to school or I’ve got to stop and, you know, do this meeting or go to work or, you know, pick up the dry cleaning and you come back and the chats still active and live, you know, you go back in and you continue the conversation until you get a resolution. So from a servicing perspective, I think AI has the opportunity to really make it a servicing and support, much more customer friendly as well. So those are three ways that I think, three easy ways that I think AI will benefit you. But it’s true also on the blockchain side. We want to understand provenance more and more. We want to understand where, you know, the raw materials of our products came from, where our food has come from and we want to know if there is a food recall that we’re safe. We don’t have to throw out all of the lettuce in our house. We would know instantaneously if, the lettuce we have came from the farm that had the contamination as opposed to the whole country. So foodborne illness, you know, economic advantages, provenance, really understanding where your things came from. Blockchain will help all of these things.

Rana Nawas: (17:36)
What are the risks for me though? Because you read and you hear that all this is terrifying and everybody knows everything about everyone, and well, not everybody, certain platforms, certain enterprises know everything about everyone. So what are the risks and how are they being mitigated, and maybe what’s the role of a company like IBM, a tech Company. What’s your role in sort of, let’s bring it to ethics now?

Michelle Peluso: (17:59)
Well, absolutely. And look, IBM has been around for 107 years, ushering in new technology in a responsible way. And as we embrace AI in particular for all its possibilities, we also really have to examine how technology is developed and used for good. Ginni Rometty, and the IBM team have really talked about three core principles. The first one is purpose. We at IBM fundamentally believe that AI is designed to augment human intelligence, not replace it. And so as we think about how we bring AI to bear, we’re always thinking about how does it augment the security professionals job, the food professionals job, the supply chain, the marketer, or the doctor, the nurse. So that’s one that’s a really critical principle. Secondly, we believe in transparency. This one is very important and very important as you talk about issues of diversity and inclusion. We always have to have and we’re committed to always having systems that are developed with transparency. So we work extremely hard to make sure there’s no bias and that you can always trace the model back. And that’s really critical because traceability, transparency, nonbiased in developing these systems is fundamentally important. And you can imagine why that’s important because if these models are going to fact how companies, how banks loan money and to whom may loan money, or you know, who gets what kind of ads, or what kind of servicing happens. The interaction, the service center is very critical that transparency and inclusion, lack of bias is front and center for us. And we’ve announced a variety of things on that front and we will absolutely maintain our leadership on the front. But the third thing of course is skills. And so IBM has always been committed, but I would say we’ve tripled down even further to make sure that the skills across all industries required for this next generation of AI, augmented work is there. So that means we have things like AI Academies, we invest heavily in young people and in training, something called P-tech schools where we’re bringing the next generation of students to the workforce equipped with great knowledge and understanding and skills rebuilding. And, you know, there’s just so many things we’re doing to make sure that all professionals, we do believe all professions will be changed by AI, and we want to be at the forefront of making sure society has the skills for a more AI world. So those three things, purpose, transparency, and nonbiased and skills are front and center for us as we think about ushering AI in a responsible way.

Rana Nawas: (20:44)
I love IBM’s concept of radical transparency. I read that somewhere. I think it’s such a fantastic term. And as the world gets more and more transparent, I think things for the average consumer, as we remove all those layers in between, we reduce cost, we improve service time. I think only good will come from that at a corporate, at a business, and at a personal level. You mentioned diversity and inclusion. I read an article that, Amazon recently pulled an AI platform they had used to hire because it was screening out all the women, not intentionally, just because all the data it had been fed was about the men they’d always hired. So I mean, how do you, how do you ensure that you get that? How do you ensure that you reduce bias in AI?

Michelle Peluso: (21:35)
Well, I think this is why training is so important and who trains AI models is so important and what the data and knowledge basis that’s fed to AI systems is so important. So these are all the things that we spend an enormous amount of time thinking about as we think about a training of AI. It’s pretty obvious that if there, if bias exists in certain datasets. So for instance, 90 percent of your current engineers are men or 85 percent of your current engineers are men, that that bias will, will affect the future which resumes were being screened out. So you really have to be very thoughtful about data cleansing, data preparation, what learning, and who is training these AI systems. And those are the kinds of things that we put front and center. Matter of fact, we launched new capabilities. Things like AI open scale that really helps make sure that no matter which module in which AI modules you’re using, our systems you’re using, we can help you explore and understand where there might be issues of bias and lack of transparency and traceability. So those are very important things. But as you know, Rana, part of this is thinking about inclusion from a technology perspective, but one of the most important things that IBM is actually just thinking about inclusion, you know, as a societal and business benefit that independent of technology we think about and focus on every single day. And certainly an enormous passion point for me.

Rana Nawas: (23:05)
And I’m so glad you mentioned that because I really want to dive into this, especially the way you are changing the narrative. Traditionally or over the past few years, a lot of the talk has been on what women need to do and you know, lean in and get your mentor and you know, ask for that raise blah, blah blah. And you were sort of passionately changing the narrative, which is great because I’m doing that in the Middle East to at least I’m pushing for it. Um, you talk a lot about the role of men. Can we, can you tell me more about that please?

Michelle Peluso: (23:35)
Yeah. Well, Rana, you and I are sisters on this point here. Just have a few, you know, a few time zones apart. I am passionate. The reality of the situation is, t’s even more true in the Middle East, is women only comprise, you know, four percent of Fortune 500 CEO jobs. Only about eighty percent of C-suite jobs are held by men. 75 to 80 percent of engineering jobs are held by men. For executives overall that’s often 70 to 80 percent held by men. So, there’s only so much, women have been shouldering the burden for a long time. As you said, ask the periods, get a sponsor, don’t talk about your kids. Dress a certain way. Again, a mentor, a lean and do all these things. And my perspective is, it’s time for them to take a little bit of a breather. You know, we should let women, lean back for a moment, and really ask the men around us to help us step up, and they are the ones who need to help change this. And here’s the thing, I believe. I don’t care about the men. And there’s so much data that we know academically, we know practically that more diverse, more inclusive teams, workforces produce better results. We know that. So I’m not on that point anymore. We’ve moved past that. All I have to say to men is, if you actually care about this issue, if this is a business priority, if it’s not, that’s fine. You know, that’s fine. If you really don’t care, just don’t ever hire my daughter. But if you do care and it’s a business priority for you, it’s a phenomenal time because there is so much more we can do – fast to change. We know about bias and recruiting. We know about bias and job descriptions. We know how to deal with that. We know that interview slaves have to have at least two women on them to make sure we find qualified women, we know how to do recruiting events in certain ways to really ensure we’ve got diverse slates. We know how to actually onboard women especially effectively, we know how to make sure that in the meeting rooms and discussions that women’s voices are heard and we know from a promotion perspective historically, there’s a huge bias that we give men opportunities based on potential, but we only give women opportunities based on past experience, not the tremendous bias for us to overcome. So we know so much we know about pay equity, we know technology can help make sure there’s pay equity. We know, so I’m so excited about this moment in time because if you care, if this is a business priority, you know, for any man and female of course, but any male leader, you can make more change happen in the next six to 12 months, then you can on any other business priority you have, this is an easier one to solve and it is entirely in your control. So if you care, you know, I’m here to support the men who care. I’m a passionate advocate of the men who care because I benefited from some of those same men who cared in my career, and I know that if you are committed to this and this is important to you because you know it’s the right thing to do because you, you’ll get better business results because you have a daughter and granddaughter, a sister, a mother, a wife, and you know how hard it is sometimes to be the only woman. If you care for any of those reasons. If this is a business priority, you know, there’s, there’s more we can do than ever before to make radical change happen quickly. And that will benefit you, your team, the women around you, your company and society.

Rana Nawas: (27:11)
You’re not just passionate about this in talk. I mean, you run IBM’s global women’s initiative and a lot of our listeners, which I think is amazing and a lot of our listeners either working in corporations or run corporations and I get approached all the time because of my work in gender parody. You know that we want to start a women’s network. What should we do? You know, I consult for companies to help them be more inclusive and get more women to the top. So my question to you, Michelle, is in running IBM’s women’s initiative globally, what have been the most effective of policy and/or cultural changes? Best Practices? We can transfer it to companies who are really keen to make this happen?

Michelle Peluso: (27:51)
Well, I’m at the point where I think transparency around goal, goal setting, transparency tools, tools to do workforce planning, carrots and sticks is the place we’re at. I think for a long time we were at the former women’s club. They can talk, they can read a book, they can, you know, and I’m just, I’m done with that personally. I think if it’s a business priority, like any other business priority, you put goals out there and you say, here’s where we are. And you analyze your data and your funnel. If you have a problem with recruiting, you know there’s ways to solve recruiting. If you have a problem with a pay equity, there’s super, super technology, easy ways to solve pay equity. If you have a problem with attrition – women are leaving the ranks too much. We know the policies that can help women stay. You have a problem with promotion, so you know, you’ve got a pretty good balance all the way up to certain exec level. We know that the things that we can do to make sure that we’re bringing women up. So I think you set goals, you’re transparent about those goals with the organization. There’s carrots and sticks involved like there would be for any other business priority, bonus, compensation, et cetera. I think you give managers and leaders tools for workforce planning. We’re building tools now internally where every one of our leaders can look at how many people they have, how many people they’re likely to attract just based on previous data, where in the funnel they have a challenge and really before the year even begins, do workforce planning. How many women would they really need to accelerate their career and help promote to, to create a more balanced workforce given attrition, trends, trends, number of people in your organization, likely number of hires, likely number of promotions we’ll have, etcetera. So I think it’s just like any other business priority, put goals around this, put incentives around this, put the right tooling in place that managers can make positive change happen and surround it with learnings and best practices and storytelling to let the leaders get started. Sometimes this is an intimidating issue. Sometimes men say, look, I want to make a difference, but I don’t know how. And it’s awkward to talk about and it’s hard to talk about. And I deeply appreciate that and respect that enormously. So that’s why, you know, getting a company motivated, getting gold, telling stories, you know, we have, where we do internal videos where guys were making a difference. Men who are making a difference, why they’re making a difference, how they’re making a difference, the uncomfortable truth they’ve had to sort of grapple with, and you know, how they’re tackling obstacles. And all these things I think are powerful agents of change,

Rana Nawas: (30:24)
Highlighting the male champions of change, and start with them young, do you know what? My kids are two and four years old and I’m turning them into feminists as quickly as they can say feminist. Who is a woman that’s influenced you, Michelle?

Michelle Peluso: (30:40)
Oh, I’d had a lot of female role models. My mom, of course. Ginni Rometty, CEO of IBM is just an extraordinary leader and you know, sort of breaks ground for women all the time. Sandy Moose, who was the east coast leader of the Boston Consulting Group when I was there was an incredible mentor. And and then I did have so many extraordinary female friends. Matter of fact, for 16 years, I have taken my 15 closest friends of mine and I away, we go to Amelia island every year for a girls weekend and the amount of strength and the love and support and humor out of that weekend and you know, and inspiration I think really carries me through the year. So, so I think you can find female mentors and role models everywhere and I have been very blessed to have many extraordinary ones in my life.

Rana Nawas: (31:32)
Yeah.

Michelle Peluso: (31:34)
But I would say, you know, just as many male mentors too. Which is why I know there are so many incredible men out there who are making a difference everyday for women.

Rana Nawas: (31:42)
So Michelle, last question. What is a great book you’ve read recently that you would recommend to someone?

Michelle Peluso: (31:50)
Gosh, I’m always reading. Every once in a while, I love reading biographies or history, and Team of Rivals by Doris Kearns Goodwin is a wonderful one about Lincoln, Abraham Lincoln’s leadership during civil war and his ability to bring people with very competing ideologies and perspectives together for the benefit of the country. It seems like an important moment to be thinking about that again, but I also love Katharine Graham’s Personal History. That is awesome. Extraordinary book about learning to lead.

Rana Nawas: (32:21)
Thank you. Great. This has been fantastic. Michelle. Thank you so much for your time. Where can listeners find you?

Michelle Peluso: (32:28)
Oh, well, I’m, I’m always of course on my channels, my social channels. And, occasionally out there talking passionately about my views and in multiple articles. So @michellepeluso is my twitter handle.

Rana Nawas: (32:43)
Brilliant. Thank you so much again. It’s been such a pleasure. Thank you. Bye. Bye. I hope you enjoyed today’s episode. I’d love to hear from you. So please head over to whenwomenwinpodcast.com to give feedback. While you’re there, you can find all episodes and show notes and sign up for a monthly newsletter. Wherever you’re listening right now, do remember to hit the subscribe button to be notified of future episodes. And please write a review when you can, to let others know what to expect. Thanks and have a great day.