Preparing for disruption: Travelex’s digital transformation
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Preparing for disruption: Travelex’s digital transformation

Clare Simmons — July 2015
Sean Cornwell, CDO of Travelex, outlines how the global currency exchange company redesigned and reorganized its business processes to prepare for digital disruption.

When Sean Cornwell joined Travelex as chief digital officer in early 2014, it marked his first foray into the offline world — and the beginning of the biggest transformation in the company’s almost 40-year history. With activities spanning currency exchange outlets, an international network of ATMs, prepaid cards and travel insurance, Travelex may be the world’s largest retail foreign exchange specialist but, as Cornwell found, it was by no means a digital one.
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It has been Cornwell’s job to set it on a course to address that. In the past year Travelex has thrown itself into its “digital innovation phase,” one designed to resemble its disruptive rise in the bureau de change kiosk market in the 1970s and 1980s, as well as its second reinvention as a vendor of diverse financial products. Its current journey needs to be “underpinned by that same entrepreneurial, experimental drive of the early years,” says Cornwell. And to fund this program of digital transformation, the company has committed to invest £50 million ($77m) in a set of pillars of change, referred to by Cornwell as “the five commandments of digital strategy”:

  1. Focus on long-term enterprise value creation; short-term revenue/EBITDA potential is not a priority.
  2. Aggressively pursue potential growth opportunities across the Spend/Send segments around foreign exchange (FX).
  3. Be willing to be disruptive and innovative in approach and business models.
  4. Aim to build large user bases of customers using products and services.
  5. Start investing in a range of different areas, and accept that some won’t work.

To the last of these, he adds: “For a Google, a Facebook or an Amazon that is continuously launching new products, testing stuff and killing stuff that doesn’t work is very natural and normal.” But for a more traditional, ROI-focused business like Travelex, a major shift in mindset is required, calling for a program of re-education across the entire business.
Communicating change

For Cornwell, internal communication is vital for transforming a traditional business into one that’s “not just digitally aware, not just digitally enabled, but one that fully adopts and embraces digital across all areas.” The digital story at Travelex sets out change on three levels:

  • Optimizing the core online ecommerce business
  • Investigating and investing in new products and services, which will be the growth engines of the future
  • Transforming company culture to create a digital mindset across the entire company — not within a digital silo

Skipping this third step is one of the main reasons digital transformation programs fail, says Cornwell. “You have to evangelize and tell the story over and over again, but it won’t happen overnight.” As Cornwell sees it, cultural change is the most difficult aspect of digital transformation and one that requires an overhaul in ways of working. The IT team has already laid the foundations for a two-tier IT infrastructure and network – “leverage legacy where it gives you advantage, but don’t be reliant on it,” he advises.

External messages have also played an important role, particularly in the recruitment of best-in-class digital talent. “How do you attract someone who might go and work for Google or Facebook? As a more traditional business, you have a serious credibility challenge.” In response to this, Travelex sponsored Silicon Milkroundabout, a tech and digital recruiting fair for graduates in London, and was one of the only non-digital pure play businesses to do so. It has also launched a £25 million digital growth fund for strategic investment in start-ups that are relevant to its business, and as a vehicle for future acquisitions, including pools of engineers and developers. Backed by a sizeable PR effort, these measures have enabled the company to attract top talent – “people are choosing us instead of some of the biggest tech names in London, and that’s a massive vote of confidence.”
Digital integration

Such a seismic shift in focus is not without risk, and it’s easy to fall into the trap of allowing a new digital workforce to remain separate from the rest of the business. The valuable exchange of knowledge between new recruits and staff who have known the business for years is entirely reliant upon integration. “Humility — not coming in with all the answers — is very important.” Allowing input and visibility into new ideas and projects means taking everyone on that journey, rather than alienating those who might have been resistant to change. In support of this, Travelex is putting 60 of its developers at the heart of a new open-plan, one-floor office space in central London.

Now 18 months into its digital transformation, Travelex has accelerated the growth of its core online ecommerce business and, critically, got the organization “aligned and excited behind our roadmap.” Cornwell believes the business was already hungry for change: “People have just been waiting for someone to come with legitimacy, with the authority to say this is what we need to do, this is the direction we need to head in.” He says the challenge will be maintaining that excitement. “Just like a start-up, you’ll get an initial swirl of engagement, but because all this delivers in the medium and long term, you’ll get a valley of death 12, 18, 24 months in. That’s digital transformation, and those pockets of inertia are to be expected. How you navigate that gap is fundamental.”
Disruption realized

Travelex’s first disruptive products are now just reaching commercial markets. In May 2015 it launched a series of mobile apps, including Supercard, an app and payment card that can be linked to debit or credit cards for use abroad — without the customer incurring fees as they spend. As a product and service, it reflects the organization’s new focus not on short-term revenue, but on building large user bases via great customer experience, without taking the distribution network and customer footprint of a global company for granted.

But ensuring every team understands how digital is relevant to their line of business is not an easy task. He points to two non-traditional teams that are often the most mystifying to the rest of the company: R&D and data science. “People have a hard time understanding what they do, when in fact those two teams can help digitize the rest of the business by showing pockets of unexplored value, enabling us to understand our customers better, automating processes and prototyping new ideas.” For Cornwell, making digital relevant to the whole company is the key, because ultimately “a digital transformation is not about a channel — you’re transforming the whole organization.”

• Sean Cornwell was speaking at Nimbus Ninety Ignite 2015 in London.
First published July 2015
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