India team showed resilience, agility during pandemic: Pitney Bowes CEO

The rapid growth of e-commerce has transformed the retail industry, creating new opportunities and challenges for businesses worldwide. The logistics sector, in particular, has seen a surge in demand for innovative solutions that can streamline shipping processes and improve customer experience. To gain insights into the current state of the e-commerce and logistics industry, we sat down with Marc B Lautenbach, CEO, and President of Pitney Bowes, a global shipping and mailing company that provides technology, logistics and financial services to more than 90 percent of the Fortune 500. In this interview, we discussed the latest trends, technologies and strategies that businesses could adopt to succeed in this fast-paced and competitive market.

Q: In the current macroeconomic environment, with much volatility and uncertainty, especially around the technology sector, what are some of your key learnings that could be applied to logistics businesses across the board?

A: The last three years have reaffirmed the importance of resilience and agility in the logistics industry, and also across industry and society broadly. Starting with Covid, companies, including ours, became very focused on adjusting their supply chain in order to continue to produce. After Covid, the supply chain interruptions were unprecedented in some ways, and certainly some of the macroeconomics have become more prominent lately. The common theme across every one of those dynamics is the importance of resilience and agility. I have to tell you I'm really struck by the resilience and agility of the Pitney Bowes India team, and how they've evolved in order to meet the moment. It's truly impressive. I suspect it's also true for India at large, as India has been one of the fastest-growing e-commerce markets globally.

Q: With global companies driving strategic innovations from India, how do you envision the India centre playing an increasingly strategic role within Pitney Bowes?

A: From the moment I joined Pitney Bowes in 2012, I could tell that our operations here in India were special. We were able to hire great talent and highly capable individuals. When we had the software business, people were working on the most important issues from a development and technology perspective. What's different now is that the operations area is working on the most important issues for the enterprise. Whether it is balancing demand with capacity or how we think about pricing or technologies that deal with big data, it was really striking to see how the Pitney Bowes Operations Team responded. What was always an important asset for our company has now become central to our values. This is a group of highly talented individuals working on literally the same problems that keep me up at night.

It's an interesting example how sometimes what you think can be a lost opportunity — in our case divesting from the software business — can in retrospect be a huge opportunity, especially considering what happened with Covid and e-commerce.

Q: Innovation has been central to Pitney Bowes’ vitality for the last 100 years; how do you continue to inspire a culture of innovation and inclusion in a company that’s over a century old and has a young workforce like the one in India?

A: Interestingly, when I became the CEO of Pitney Bowes 10 years ago, I met with three of my predecessors through an odd set of circumstances on three consecutive days. I can actually remember each of the conversations. What was interesting is, by and large, they had pretty different perspectives on the company and the business, the opportunities, the problems, etc. But there were two things that all three of them agreed with. The first was that Pitney Bowes was a highly innovative company. I must say, for me that wasn't necessarily my frame of reference, as I was coming from IBM. But I can tell you with the benefit of being here for a decade now, it was certainly true. It was true in 2012 and has indeed been true for 103 years. The other thing they said, which was obvious at the time and has become even more obvious now, is that there's a remarkably special relationship between Pitney Bowes the enterprise, and the team.

Q: Within your tenure as CEO of Pitney Bowes, what key events or technologies could you recall which propelled the shipping and mailing industries to their present stature?

A: If you look at it from an industry perspective, e-commerce, which was an important thing before Covid, and is really more important now. I spent the first three or four years of my tenure cleaning up our back room. And what I mean by that is, Pitney Bowes engine room and technologies that we had back then were a bit of a mess. It wasn't terribly well organised. There was a little bit of everything. So, as you think about the importance of interacting with your clients digitally and taking advantage of digital technologies, what people tend not to ask much — though it is foundational — is whether they have the basic technology foundation and a structure to allow exploiting digital technologies for driving e-commerce. So, the first job was to build that foundation.

The second job was creating something called the Pitney Bowes Commerce Cloud. The Pitney Bowes commerce power was intended to do one simple thing — creating the enabling technologies to exploit digital technologies and also interact with our clients in a more contemporary and digital way. The other thing that it did, and this was a little bit more subtle, was it became an enterprise project. So, every one of the businesses got behind the Pitney Bowes Commerce Cloud. That meant, we had a standard set of technologies that they used in order to reach out to the market to drive their cloud initiatives, that built from the common foundation, but also sent a very important message internally, that we were going to use common systems, common technologies across the enterprise, so that we could leverage our scale, be faster and really interact with the marketplace in different ways.

Recently, I reviewed a couple of technology projects around data platforms used across every one of our businesses that enable our shipping and logistics capability. There's technology that helps us balance supply and demand that help us think about pricing in a very refined way. There are technologies that help us interact with customer chat. There are technologies that allow us to use and optimise the automation that we have in our distribution centres. And an interesting thing about all those initiatives is that they are seemingly very different, but they use the same basic technologies. That began with having a common set of processes and systems in the back room which was furthered by commerce cloud. Now it's become very routine that the team uses technologies across the board which allows us to be scalable. It allows us to take advantage of our size and be speedier. As you think about the last two or three years, being agile and very resilient and adjusting to the moment requires that you're able to do all those things as well.

Q:  How has your role as a CEO evolved over the years, particularly when we talk about the changing marketplace, competition, and evolving business landscape?

A: The role of CEO has changed profoundly over the last three or four years. Take Covid, for example. I never would have imagined when I first became a CEO — or at any time before then — that we would spend time trying to figure out how to get people vaccinated or how to keep them safe, or what are the protocols when you are inside a distribution centre. There's much more pressure, at least in the US for CEOs to take positions on societal issues. To a degree, I'm not sure CEOs are well equipped to talk about these. I think any successful business should answer four question every day. First, why do customers buy from me?

Second, why do employees want to work for me? Third, why do investors want to invest in the company. And fourth, why is it that communities and governments give me capability and license to operate in their respective venues?

Those are four questions — I believed in 10 years ago, and I believe today — really need to anchor what CEOs think. When companies misbehave, societies have a way of smacking them down. When companies take advantage of their employees, employees tend to leave. It is a set of regulating questions that should inform how you think about your business, and there are questions that the CEO can uniquely answer.

6. With the advent of new technologies, the shipping & mailing industry has seen tremendous change. This change has been driven by a push for cleaner, greener, and more sustainable operations across the value chain. How has the industry in general and Pitney Bowes in particular adopted sustainable ways to support the environment?

A: We're in the early stages. We've had some nice recognition for our sustainability efforts and we're proud of that, but there's a long road ahead. We think about sustainability across a couple of different dimensions. The first is that for a while we've been thinking about our equipment and ensuring that our equipment conforms with sustainable practices. Are there ways that you can dispose of the equipment that is environmentally friendly? More recently, as we've moved more aggressively into the logistics space, the question is how we think of making trucks and transportation more environment friendly. How to use electric vehicles, or hybrid vehicles instead. We, along with many others in the industry, have committed to being carbon-neutral by 2040. The thing about 2040 is that it’s pretty far away, but you need to start working on a lot of stuff. You need to start thinking what kind of capital it's going to require, and if you're going to invest in an electric fleet, what is that going to cost? If you go with solar in your facilities, what will be the cost?

Q: How did you align stakeholders within the organization to ensure the project was seamless and successful without diluting the core business strengths?

A: Thomas Watson, one of the founders of IBM, said a company should be prepared to change everything about itself besides its core value system. So, if there's one thing I didn't want to dilute in Pitney Bowes, it was the company’s core values. We've been very careful about protecting the values. From a business and economic perspective, our mailing franchise continues to be very important, so we've worked very hard to sustain that. When I joined Pitney Bowes in 2012, we were getting single-digit revenue growth from the products in that business. In our mailing business in North America, that number starts at 40 percent. So, we have made substantial investments to not just protect our core, but also to transform our core. Along the way, we've invested a lot in e-commerce shipping and shipping overall. The most important thing from my perspective is the essence of the organization.

Q: Over the years, Pitney Bowes has been lauded for its employee-centric policies and work culture. What makes it a consistently great workplace?

A: We care. We care deeply. We care about our team, and our team cares about the enterprise. One of my predecessors, Walter Wheeler, said if you do right by your employees, they will exert incremental efforts to make your results special. It was true in 1939. And it's true in 2023.

Q: What according to you is going to be the next big revolution in shipping & mailing technology?

A: That's a great question. I am still kind of focused on the here and now. E-commerce is going to continue to evolve. I think there's much more friction that can be taken out of that experience in terms of how platforms interact with consumers. The shipping experience, in particular, is incredibly important. Customer service is one of the most important aspects of an e-commerce purchase, but in general, customers still aren’t very happy with how it works. So, I think there are all kinds of opportunities to take friction and complexity out of the experience.