Tasked with accelerating digital transformation at Allstate, Christopher Paquette recognizes the digital potential embedded everywhere. Reflecting on his first year as Chief Digital Transformation Officer at Allstate, Christopher shares essential lessons in collaboration, creating value for the customer, and transformation strategy.
In this episode, Christopher discusses focus areas of connectivity, automation, decisioning, and pattern recognition. He gives examples of analysis indicators and the various speeds of digital transformation. Christopher dives into the idea of influence when your discipline is not siloed and discusses his passion for community building through music and music education.
- (01:42) – Introducing Christopher Paquette
- (03:21) – Digital transformation
- (07:04) – Decisioning
- (09:11) – Relationship building and collaboration
- (13:34) – Influence
- (18:10) – Outcomes and determining the “why”
- (21:51) – Indicators: starts, containment, and satisfaction
- (24:40) – Beginning a role in Q2
- (26:01) – Dedication to music and The People’s Music School
About Our Guest
Christopher Paquette is the Chief Digital Transformation Officer at Allstate. Previously, Christopher served as a Partner at McKinsey & Company for twelve years. His over two-decade career has orbited strategy, digital, and analytics. Christopher earned an MBA from the Kellogg School of Management at Northwestern University.
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Full Show Transcript
Pat: Hello fellow innovators. This is Patrick Emmons. Today we're resharing insights from our previous guest on the show, Christopher Paquette. He's the Chief Digital Transformation officer at Allstate. In this episode, Christopher talks about accelerating digital transformation and leading teams. Christopher's passion about growth, customer experience, and leveraging AI, digital and data to drive positive change.
This episode last year was quite a hit, so today we're sharing it again for those who did not listen to it or those who didn't have a chance to hear it. Here we go folks.
Hello fellow innovators. This is Patrick Emmons.
Shelli: And this is Shelli Nelson.
Pat: Welcome to the Innovation and the Digital Enterprise Podcast, where we interview successful visionaries and leaders, giving you an insight in how they drive and support innovation within their organizations.
Today we're welcoming Christopher Paquette to the show. Based in Chicago, Christopher is the Chief Digital Transformation Officer at Allstate Insurance where he is passionate about growth, customer experience, and leveraging digital tech data to drive positive change. His background includes 12 years as a partner with McKinsey & Company, with a deep expertise in financial services, driving transformational change, deploying deep digital and analytics technologies and developing leading strategies. He's passionate about digital and innovation and have served many of the top North American financial institutions over his career, driving cost, growth and customer experience.
He's also led programs to transform technology architecture, implement agile at scale, reimagine customer and operational journeys, enhance digital sales and marketing processes and reinvent culture to drive organizational transformation. Really excited about having you on the show, Christopher. Welcome.
Christopher: Thanks Patrick. I'm excited to be here.
Shelli: Christopher, if you don't mind, can you share with our listeners a little bit more about what you're doing?
Christopher: Yeah, happy to. So professionally, I'm just over a year into my role at Allstate, which has been a fun and exciting ride. As chief digital transformation officer, I'll talk more about this as we get into the depth of it here, but basically the role is to accelerate digital transformation. And when I came on board, Allstate has always been a forward-thinking organization and it's not like they had not been investing in digital, but there's a question of where do we do more, how do we go faster, how do we do better together? And that's really what I was tasked to come in and sort through.
And so over the past year I've been busy building a team focused on all sorts of stuff, from transforming customer and employee journeys to automating and digitizing internal core processes, thinking about innovation, how do we embrace some of the new tools that have come out? Perhaps you've heard of ChatGPT, it's creating quite a stir. And so figuring out how to use new conversational technologies like that has been a big part of it.
So lots of fun over the past year. Briefly before then, I was Chief Digital and Strategy Officer for another insurance company focused on life and health and then at McKinsey, as you said. And so in some way, shape or form, I've spent my career thinking about the power of technology, digital data, analytics in financial services and really with kind of that strategic lens of how do we use this thing to do more and go faster.
Pat: So I hear this term all the time and I think it means a lot to a lot of different people, but what is your definition of digital transformation? What does that mean?
Christopher: Well, so I could probably spend the rest of the time talking about that and you could ask me all the questions and I could give all the answers. I'll try to be brief and give my own version. I don't know that there's a right version either, by the way. But I would always go back to the why behind it. So asking why would we digitally transform leads you to what is digital transformation. And I think the why, I always talk about it as two parts. One is protecting the core of what the business is and how you create value and then disrupting. Disrupting the ecosystem, creating new products, creating new services, new revenue models, new routes to market. And between those two, protect and disrupt, you really kind of have the waterfront covered for value creation. And so ultimately digital transformation is about how to create more value through technologies which are largely customer facing or at least customer impacting, and so therefore there's a bit of customer experience in there as well.
So that's kind of the why of digital transformation. It provides a nice foundation to say, okay, what is this thing? So it's about protecting, disrupting, to create value for customers. If you say, okay, great, what's the what? What are the things, what do you go do in digital transformation? Well, that's where it can be really broad. And so generally, I think about it in five buckets. I think there's one bucket of digital transformation stuff that you go do that's about core underlying processes and getting them right for a digital world. And so this is reimagining experiences and asking what might've been 10 steps before in some operational process. Can we make that five steps or three steps or one step or no steps? How do you rethink those underlying flows? That's bucket one.
And then buckets two through five all kind of flow together. There's an aspect of how do you build better connectivity on top of those better processes with your customers and the users? So there's connectivity. That leads into automation. So once you've established that digital connection, you can automate it and you can say, well, we can build bots to do this or core system flows or if it's RPA or something else, so let's automate. So connectivity, automation, that leads into decisioning. And so how do you take the data trail that's created by automating and make better decisions using the data that's now in the system? And then that decisioning leads to pattern recognition and delight and the underlying intent and really understanding what your customer's trying to get done, that enables the last thing, which I would say is innovation and that idea of the repeat and learn and reuse quickly that feeds back into the overall thing.
So that's how I would talk about the why, the protect and the disrupt, and then the what I generally put in those five buckets of underlying process and then connectivity, automation, decisioning and innovation. And I've used that framework, I'm like a structured McKinsey consultants, kind of a pointy head type, and I've used that definition for the past, I don't know, eight or 10 years, and it's still right, and it's kind of timeless as a way to think about the power of technology and digital and data, even in the age of current large language models and all the crazy stuff that we're going through now.
Pat: There's a lot there to pull apart, but it's awesome. I think that's really cool and interesting stuff. You mentioned decisioning, right? When I hear decisioning, to me that means artificial intelligence.
Christopher: Yeah.
Pat: So that's something that's been working into these models for a while then. Because I think what we hear now is a lot of people are kind of putting the decisioning way further upstream from how do we do value creation versus what you're doing.
Christopher: I guess the power of AI, and I'm not even really responsible for it at Allstate, to be clear. And so it is like a partnership of pulling in other colleagues, especially our Chief Data Officer, a guy named Eric. And so if his team's responsible for the data scientists and building the models that are actually driving the decisioning, my team works closely with him of saying like, okay, where do we want to deploy some of those models?
And I think to your point, Patrick, they could be further upstream of how do we predict what a customer's going to call for next and make a decision therefore to, for example, answer the phone, if I know it's you calling and you just made a claim payment, I bet you 80% of the time you're calling to say, did you get my payment? And so we're going to make the decision way up in the value stream to say, if it's Patrick calling and he just made a payment, we're going to answer the phone, the first thing we're going to say is, "Hey, Patrick, we got your payment. Is there anything else that we can help you with today? If so, press one to blah, blah blah, or state your intent." And so you can think about it further upstream like that.
You can also think about it further downstream, which is, I'm at the point of selecting a policy to purchase or to renew. And I might say, well, what are the best options for Shelli and renewing your policy? Let me pick the options and what do I know about her and how do I make that decision to get to a good, better, best or whatever, a few options and let her make that choice. And so there's another example of decisioning further down that we can [inaudible 00:08:57].
Shelli: So Christopher, you've been there only a year. What's the most important lesson you think that you've learned so far?
Christopher: I think a big one is that it's impossible to over-invest in relationships and building belief in what is possible if we all go together. There's the old saying, "If you want to go fast, go alone. If you want to go far, go together," something like that. And I think that's really true for something as complicated and intertwined and unknown as digital transformation is, especially in an organization that is as big and complicated as Allstate is.
And so I've already mentioned one of the colleagues that I work with, the Chief Data Officer. There's a bunch of others, from our Chief Experience Officer and partners in the business and other parts in technology. So I think being really thoughtful about who those relationships are and how to cultivate them is one of the biggest things that I've learned and has really been true.
And this core crew has served as a support, they've served as motivation, they've served as sounding board, they've served as thought partners, shoulders to cry on at points in time, people to commiserate with and to really energize. And so I think that relationship building is just really, really important. I think that's probably the biggest thing that I've learned so far over the past year about working here at Allstate.
Pat: I'm fairly sure I know how you answer this next question, but I think it's important for everybody to understand. Why is that important? What is that made possible for you?
Christopher: I think maybe it comes back to the go fast, go alone, but if you want to go far, go together. I think the rate of change and pace of change of the types of technologies that are out there and even keeping your finger on them all is one thing that could be really hard to do alone. The fact that really digital isn't a thing in and of itself, it's kind of part of everything else. And so it's an inherently hard mandate to go and say, well, I'm just going to go transform digital at Allstate alone. That doesn't even really make sense. I don't even know what that would mean. Because there is no digital at Allstate, it's just in everything at Allstate.
And so I think the mandate that was initially given, I like to tell a story, the role is to accelerate digital transformation. And I was like, well, what does that mean? And they were like, well, we're hoping that you would come and tell us. And so that was the start of the whole thing and therefore the initial process was even figuring out what needed to go be digitally transformed. And the answer to that was, well kind of everything, but it's embedded in everything, and so therefore you have to have those partnerships all over the business because that's really where the digital transformation is taking place. I probably didn't say that super clearly, but it's because it's embedded everywhere, and so you have to be embedded everywhere too.
Pat: It's an interesting role when you talk about either digital transformation or the chief digital officer because it's not a silo discipline. You really have to, from the financial systems to everything, to HR, every aspect is going to be impacted by what you're trying to get accomplished. And it sounds like building relationships, and I like to use the word having influence is critical for those types of things, and it's just good leadership, but it's definitely something you've got to... I think people have sometimes a misunderstanding of what real leadership is and they think it's giving orders.
Christopher: I like that word, Patrick, and influence, I think it's a great word to describe. Because in a lot of ways I don't within my organization have a whole lot of control or resource. I don't have a thousand person team. It's much smaller than that. So therefore, influencing and really agreeing with other partners, how are we going to get stuff done together has had to be the name of the game.
And by the way, I didn't mention this at the beginning with what is digital transformation, but that's actually part of what digital transformation is. It's figuring out how to work together differently. And the easy word to use is more agile, it's that, but it's also more than that. And how do you share ideas and how do you learn things quickly and how do you test your way into the market and what does deploying an MVP really look like and how do you fast follow that and how do you get the right folks comfortable with the progress that you're making and all those kind of cultural and operating model and way of working topics that have been something that I've spent a lot of time on over the past year as well. So there's almost kind of like the how to digital as well.
Our CEO, Tom Wilson, has used a term of phrase, "We have to be digital to do digital." And so those types of topics are like, how do you be more digital? And that's something that you have to do with others and the partners and relationships that you have in the organization.
Pat: So many other questions. Curious that ability to understand, I think being a consultant, having that background, one of those things to have influence without authority you touched on, is that something that you learned previously that is just part of your go-to move when you're dealing with these types of environments?
Christopher: Yeah, I think the short answer is yes. I don't know if I'm an inherently likable guy, maybe I...
Pat: Was going to say no, I barely know you, but...
Christopher: That's all of it. Or if I'm just super or convincing or maybe very, very confusing and so therefore people just assume I know what I'm talking about.
Pat: All work, they all work.
Christopher: These are all techniques, they're all valid. But I think, I mean actually they are all techniques and you have to pick the right techniques to influence and get changed on the organization. And obviously I don't pretend to know things when I don't know them, that one I was kidding on. But I think it is a role in which you have to be able to apply the software influencing skills to understand people's motivations and how the organization works and how folks are incented and how the politics work and where the bodies are buried and the skeletons in the closet and all that other kind of stuff, because that all influences what people do.
And at the end of the day, it's easy to say this creates value and so we should go do it. And obviously that's the strongest argument to make of dollars, cents, happy customers, delivering the services that we can do well for our customers from Allstate. But a lot of times that has to be presented in different ways as well. And so knowing what ways to use to influence I think is certainly a tool that I've probably learned mostly at McKinsey and I've deployed since then, but it's an important one in my role here.
Pat: I think it's an important role for all leaders, right? The idea that you're... I know sometimes people react poorly to this word of influence as if you're using some kind of magic on people, but to deploy influence or to create influence means you have to understand other people's motivations. You only do that by getting, you mentioned, you can't over invest in the relationships of understanding what is this person's motivation. And I think it's tremendously impactful when you're trying to align people because I think your job is to align people around how are they going to be part of the confluence of all of these needs to achieve.
You mentioned the core earlier, obviously we have to keep making the money that we have. And then what you're trying to do is create the opportunity to make the money in the future. What is the most important thing when you're starting something like this? What is the thing that you use to come back to regularly to keep everybody moving in the same direction?
Christopher: I think I'm going to give two answers. So the first thing you got to come back to, and it's a word we use over and over and over again, is outcome. And what are the outcomes that you're driving for? And it's just a different way of saying the why. So the same protect the core and then disrupt. But the outcomes that we're shooting for is thing number one.
And by outcomes, I don't mean we've put the new feature into the mobile app or there's a new widget or we've released a new automation within the chatbot or we can contain this intent or whatever. That's a thing, but it's not really an outcome. The only valid outcomes are customer satisfaction or money, one way or the other. So I think continuing to come back to why are we doing this, what are the outcomes that we're shooting for? Do we have goal alignment? All the way up to the top is so important. Because if not, then people are going to do what they're incented to do, which is to meet their goals. And if their goals are different, then people aren't going to work together well. And so I think coming back to the outcomes, do we all agree this is how they all ladder up, I think is thing number one that I keep coming back to.
And I think thing number two is my own vision, our own vision that we've established for digital at Allstate. And it's not a digital strategy, because I don't believe that there's such a thing. I think you just have a strategy and I think digital has to enable that strategy and create the value and reach the outcomes. But what I've been calling it is our three speeds of digital transformation. So three plus one, the three speeds, fast, medium and slow. There's a fast speed, which is a highly rigorous way to evaluate processes from a bottom up basis, optimize, eliminate what you can, automate. It's kind of like core system digitization and this whole thing of what took 10 steps and 10 minutes before can take one minute and one step in the future.
There's the medium speed of transforming journeys and experiences, and then there's the slower longer term speed of really thinking through the digitally transformative ideas of the future. And then the plus one is just we have to do all that with consistent tooling and standardized digital capabilities. And so this vision of three plus one, the three speeds plus digital capabilities is a very simple way. Hopefully I've explained it simply here, but a simple way of keeping everyone aligned on what is our plan for accelerating digital? It's those three things. Those are the three things. And so we've stood up an optimization factor to drive process, and that's how we've kind of structured our approach. So that's the second thing that I keep coming back to. So outcomes and then the three plus one, which is our approach to digital transformation.
Pat: That's awesome. I love the details on the outcomes because I think some people might invert what you were focused on, which is the external, the real numbers, as opposed to more of, I don't want to call them tactical, but more roadmap achievements of like, hey, we got this done, we got that done. I always think about scorecards about how to create change and when you think about driving to some new reality, what is on your scorecard that's a leading indicator that you're making good traction?
Christopher: So I think there's always a need for leading indicators as well. But I would call them leading indicators and not outcomes, and that was kind of the distinction I made before. And so some of the leading indicators that we look at are a bit more of the operational widget-y kind of things, and what's the volume flow and containment. And so I think of one easy example to give, and it's pretty intuitive and not rocket science is within our servicing space, or what we call when customers want to manage their relationship and interact with us, there's a whole bunch of things that they might want to get done.
And this is like, I might want to add a driver to a policy or I might want to change my address, or I might want to change my billing date, or I might have a question about payment. So it's all the stuff that you do that is not claims once you're already a policyholder. And in that space, to use a different word, it's like service. And in that space, it's all about what are the intents and how does it cost to fulfill them for a customer and do it well so that the customer is happy.
And then you get into all the complexity of like, well, yeah, but via which channel and how many calls and could they do the thing on the app and did they go from one channel to another and did they talk to their agent? And it gets pretty complicated pretty quickly, and maybe they have more than one intent for a given call. And so it gets complex, but ignore all that for a second. The simple indicators that we use intent by intent is to say, how often did a customer start something digitally? How often did a customer finish that thing digitally and how happy were they? And really simplifying it down to those three things. It starts containment and satisfaction, really gives you a good indication of, okay, within that little piece of the puzzle, how much is it costing us to keep our customers happy per transaction? Because we have to have happy customers, we're going to get there, but we want to do that as cheaply as possible. And so those are the leading indicators that we use for that particular part of the business.
Pat: That's fantastic. Thank you so much.
Shelli: Christopher, when we talked to you last time, you said that joining at the right time of the year was really important for this role. I think you joined Q2 last year. Can you tell our listeners more about that?
Christopher: Yeah, I don't know that there's any science behind it. It's maybe more of an observation than anything. But I think it's... one could say that joining in Q2 gives you enough of a runway in that year to get some stuff done. And also enough leeway where if you start on January one, the strategic plan for the year is still fresh and you might feel a little bit constrained by like, well, I got to do whatever the plan was. But if you join towards the end of Q2 or whatever, there's a little bit more leeway to shape based on a more real time analysis of the needs of the business. And so I think joining Q2 was pretty cool because we're well on our way into the year already and afforded me still plenty of opportunity to get a lot of stuff done in 2022 and to strike that roadmap myself. So it was good timing.
Pat: Well, I know I've got about a million more questions. Unfortunately, I don't think we have that much more time. But one of the topics we talked about before is something that you're personally passionate about, The People's Music School. Did you want to tell everybody about that?
Christopher: Yeah, thanks for asking. So this is... I'm actually going to start in a slightly different place. Outside of work, my day job is Digital Transformation Officer, my weekend job is as a active musician and father of the three girls who are all deeply into music. And so you put together some of those interests of musical education for kids and performing and playing. And I grew up musical and I play a bunch of instruments and it's always just been an important part of my life.
And even to the point where when I was at McKinsey, we had a McKinsey band and we did all the bands competition in 2019 with Bane and BCG, and they were very, very gracious when McKinsey swept the floor and won, which was awesome, at the Vic Theater in Chicago. And we raised, I don't remember how much it was, it was like 50,000 or something for charity and did some good and there was maybe a thousand people there. So it was like a real rock show. And for anyone who's seen whatever movie that was, Jack Black, one great rock show can change the world. And so you live by that. And great connectivity and it was just really, really fun event and brought each of the firms together independently, but also together. It was just kind of fun to interact with them too.
So fast-forward to six months ago, I'm thinking I've left consulting, I'm now an operating executive, and I see really, really clearly that there's a big need, especially coming out of the pandemic, for an opportunity to build connectivity within corporate culture. At the same time, there's People's Music School, which the lead singer of my band is the CEO of. And they do really, really cool work for about 750 underprivileged kids all over Chicago and they give completely free music lessons on I think 21 different instruments. And it's just an amazing, amazing mission. So if anyone's listening-
Shelli: Awesome.
Christopher: Go check them out and make a donation. And Peng Miriam, who's the CEO, because she's doing an awesome job at leading that. But anyway, fast-forward, what am I currently excited about? I'm excited about repeating the Battle of the Bands idea, but doing with iconic Chicago corporations and using that to benefit People's Music School. And so we're in the early stages of trying to get a plan for fall of this year at the Riviera Theater, which the owner of has very graciously agreed to help us out, and he's excited about the mission as well. So anyway, just kind of a plug.
Pat: Awesome.
Christopher: Transforming kids' lives, different type of transformation, but it's just a really great organization, People's Music School, and should be good for the companies that join us too.
Pat: Well, I think transforming children's lives probably the most important work we can all be doing right now, right? Create a better future for everybody. I think you want to get to the root of the issue, I think that's probably about as close as we can get. So it's really amazing that you and your friends are focused on that. I am curious, what's your favorite instrument?
Christopher: To play? It's got to be the drums. That's what I play in the band. And so I play piano and guitar. I don't play anything particularly well, to be clear. I'm like-
Pat: So you know he's good. If he was saying, I'm awesome, now you know he's terrible. It's like the guy who shows up for hockey with new gear. That guy's terrible.
Christopher: Even if you're bad at the drums, they're still fun because you just get the hits.
Shelli: They're fun.
Pat: I played trumpet because I just didn't feel like I was loud enough. That was a real problem.
Christopher: Yeah. Nice, nice. Do you still play?
Pat: I do not. I do not. But my kids got into it for a little while and I had a son who played the trumpet and a son who played a saxophone. And one of the big change, I graduated junior high in '87, high school in '91, sheet music was this unattainable gold that now they can just download stuff from the internet where it's like they're playing the Star Wars anthem without even really trying, where I remember that was a three-year effort to try and get sheet music in the early nineties and now it's like, yeah, you just download what you want.
But yeah, having two kids playing in the house just for fun was a blast. So I think music does it wonder, it's amazing to me the overlap in engineering and music. How many folks that I know who are in engineering, they're either in the marching band or some kind of concert band in college. I also think there's something about being in concert with others is very similar to being on a software team. You're expert of your equipment, your tool, you know your seat, you know your role, but you have to play well with others. And I think that's very a nag list to being a solid member of a software team and many other teams. You're not really competing against somebody, other than just trying to get better as a team. So I think there's a lot of overlaps there, and I've seen that throughout my life when it comes to a number of companies I've worked at where there was not just one band, but a couple of them because... And there's always that weirdo French horn person, they're like, yeah, let me be in. It's like, yeah.
Christopher: French horn.
Pat: Maybe.
Christopher: Hey, there's a reason that us band nerds go on to have very successful careers, I guess. It's all those collaboration skills and working as a team.
Pat: Totally, totally. And knowing you're not first chair and figuring out that you're the role player in this, right?
Christopher: Everyone has a part.
Pat: Everyone's got play, right? Christopher, thank you so much for taking the time. Good luck. Allstate is obviously one of the gems of Chicago and somebody that we're all pulling for. I know you guys are going to keep doing awesome work and I'm really to see what new features, functionality, and what you do to move them to the next level. So congratulations again. Hope you come back and visit with us, maybe.
Christopher: I'd be honored if you'd let me come back. It's been a lot of fun. Thanks, Patrick. Thanks, Shelli.
Pat: Awesome. Awesome.
Shelli: Thank you.
Christopher: We also want to thank our listeners. We really appreciate everyone taking the time to join us.
Shelli: And if you'd like to receive new episodes as they're published, you can subscribe by visiting our website at dragonspears.com/podcast, or find us on iTunes, Spotify or wherever you get your podcasts.
Pat: This episode was sponsored by DragonSpears and produced by Dante32.
