‘We digitized ourselves’: Accenture CEO Julie Sweet on her company’s rapid-fire transformation
At age 42, Julie Sweet jumped from being a partner at an elite New York City law firm to becoming general counsel at Accenture. Now, a decade later, she’s running the place. We sat down with the new CEO of the $43-billion-in-revenue professional services firm¹ to learn what she’s seeing—and hearing—about the global economy today.
This edited Q&A has been condensed for space and clarity.
The digital decade
Prior to being named CEO of Accenture in September, you were CEO of the firm’s North American business.² How have your daily conversations changed?
Sweet: I’ve spent the last six months traveling the globe, meeting with over 70 CEOs and 100 other C-suite leaders and our clients in Europe, Asia, and North America. It’s been an incredibly intense time but exciting because when you do that in such a compressed time period, you hear consistent themes around the globe and across industry. One theme is that we are at an inflection point. For large companies, they are looking at 2020 as the decade of delivery on the promise of digital and technology. We spent the last five to six years experimenting, doing business cases, and now it’s about going quickly from vision to execution to material value.
It’s a very different mindset. CEOs are saying, “We’re not questioning more digital business. We’re not questioning that technology can transform us. But we need to get return on our investment.”
CEOs and business journalists talk endlessly about “digital disruption.” How do you define the term?
I’ll first talk about what “digital” means because a lot of people equate “digital” with “technology.” Digital is really two things. It refers to a set of technologies, everything from artificial intelligence to the use of e-commerce. But digital is really about a different way of working, of making decisions, of partnering and reaching your clients, and so it’s also about how you do things. And the most successful companies really understand that going digital means changing how they work, how they engage, and how they make decisions.
But it’s the other half of the term—”disruption”—that frightens many: It may well mean they’ll be out of a job in five years. What do you say to clients to help them have that conversation with their workers?
What we say to our clients, what we do internally, and what we should all be doing with our communities is speak in terms of shared success. So when we have the conversation with the CEO that says, “Here’s how you need to use technology. It’s going to take away jobs,”³ we advise them to talk upfront with their employees about how many can be reskilled—and for those who likely can’t be reskilled, we need to ask, How can we help them get their new job? We believe that part of our responsibility is to have that conversation from day one. In client conversations, I’ve had over the last two weeks, it has been on the agenda with probably five of them.
Accenture has, of course, disrupted itself over the past decade. Over 65% of your business is now in digital, cloud computing, and security services.⁴ What did you learn from that renaissance?
Well, I think first of all, our renaissance, as you call it, is really two things: It’s shifting the services we offer clients, but it’s also how we operate ourselves. So 99% of what we do is now done in the cloud; we’re using the same platforms that we’re implementing with clients. We digitized ourselves.
What has the coronavirus outbreak taught us about global business?
It highlights the integration of the supply chain around the world and the dependencies. We’re spending a lot of time with clients thinking about their supply-chain strategy and helping them become more resilient. One of the big aha moments is how many large companies still don’t use collaboration tools and aren’t using digital technologies internally. They’re engaging with their customers, but they haven’t invested in the infrastructure that allows their employees to telecommute. That’s going to be a big area of opportunity to help clients.
Inside the M&A playbook
You’ve also been on a buying spree.⁵ How much of your growth is coming from that?
We will always focus most on organic growth, and we’ve been very consistent in terms of our capital allocation. If you look back over the last few years, around two percentage points of our revenue growth every year is from acquisitions. So we’re growing at a 9% compound annual growth rate. Seven of those percentage points are from organic growth; two from inorganic.
We acquire companies for one of three reasons, though sometimes all three are relevant. The first is to scale hot areas of the market. So a couple of months ago, we bought a fast-growing Chicago company specializing in data science and analytics, a very hot area. The second reason is to build our deep industry and functional skills. So we’ve made acquisitions focused on financial services and health care. And the third reason is to acquire complementary skills. So last year we bought Droga5⁶, which was just named the ad agency of the decade.
Large companies are looking at this as the decade of delivery on the promise of technology.Julie Sweet
Talk about that for a moment. Why are so many consultancies gobbling up ad, marketing, and design firms?
We’ve been doing it for 10 years, building the capability that’s behind Accenture Interactive. It’s about creating customer experiences, which require deep technology skills and design skills. How do you actually reach customers, how do you segment them? To answer those questions in a holistic manner requires both data science and creativity.
We were hired recently by Kimberly-Clark to change the relationship they have with moms around their baby-care products. Their chief growth officer said that she wouldn’t have hired Droga5 on its own or Accenture on its own. The combination is why they hired us.
The hard part is not just having those capabilities but also the scale behind them in terms of technology to serve major enterprises.
The people business
Speaking of scale, you’ve got more than half-a-million employees across the world.⁷ Will your workforce a decade from now be anywhere near as big, particularly as you continue to digitize operations?
We actually have constant change in our workforce because we build automation into everything we’re doing. We’re growing because we’re serving more clients, doing higher-value things. So it isn’t, like, “Oh, wait a minute, now we need to automate.”
So I don’t focus too much on how many people I have. I focus on, What are those people doing? And we do what we tell our clients to do: focus relentlessly on making sure that we’re using the most advanced technologies and reskill our people to use them. When we automated 40,000 jobs in our business-process outsourcing business, we reinvested 60% of the upfront savings to upskill those who had those roles. We invest $1 billion a year in training, reskilling, and leadership development—training over 300,000 people in the last three years alone.
And we have a growing business, which is why we’re able to do it.
Most important is that we’re transparent from the start. In this case, we said to our people, Help us automate what you’re doing now, and then we’re going to invest to upskill you. That’s why we have no change in our average 10-year attrition.
You’re one of just 14 women CEOs at a Fortune Global 500 company. There was a moment, when you were in your early thirties, that became a turning point for you in your mission to help other women navigate their careers. You were about to make partner at white-shoe law firm Cravath, Swaine & Moore—and there was a meeting at the firm about unconscious bias.
It was in 1999, and I can still see myself walking up to our conference-room floor. We had an old-fashioned conference room, big table. I know exactly where I sat. It was literally two weeks before they were going to make the partnership decision. Everything was fine. I go in, I sit down, and they have this facilitator who turns to me at one point and says, “Julie, you’re a senior woman in the world. Have you ever experienced any of these things, unconscious biases?”
I opened my mouth to speak … and I started sobbing. Big loud sobs, and I could not get myself under control. I got up, went back to my office, and shut the door. Maybe half an hour later, the first woman corporate partner, a good friend of mine, came in.
And she said, “Okay, the men have met. They asked me to come see if you’re okay.”
And she looked at me, and she knew. She knew there wasn’t some big scandal. Because at that very moment, when that woman asked me that, it was like everything kind of came crushing down: All the things that I had endured at that time to get to where I was.
And I do talk about it now because it was a turning point for me. And I thought, “Now that I’m going to be a partner, I have to make it so it’s not the same for other women.”
And it was something that I worked hard on as a partner, and it shaped who I am today. And as I’ve grown and learned, it became not just around gender⁸ but around all kinds of diversity.
(1) Annual revenues: Prior to the market’s dramatic March slide, surging revenues pushed Accenture’s market cap to a high of $137 billion on Feb. 19, up from around $56 billion in February 2014.
(2) First among equals: North America is Accenture’s largest market, accounting for 46% of the company’s 2019 revenues.
(3) Robot revolution? The Brookings Institution estimates that 36 million U.S. jobs will face “exposure to automation” by 2030, with about 70% of those at risk of being replaced by technology.
(4) The rise of digital: The share is up from around a third in 2015.
(5) Getting acquisitive: Accenture spent more than $6 billion on 129 acquisitions in its past six fiscal years.
(6) An ad, ad, ad, ad world: Accenture Interactive, the firm’s digital
“experience” agency, paid a reported $475 million for the Madison Avenue shop last spring. In the past two years, Accenture has purchased similar firms in Brazil, China, Denmark, France, Germany, Mexico, the Netherlands, Spain, Sweden, the U.K., and the U.S.
(7) Global workforce: Accenture passed half-a-million employees in late 2019, after its fiscal year ended. The company had 358,498 employees in fiscal year 2015 and 492,000 in 2019, according to Bloomberg.
(8) Doubling down on diversity: Accenture was ranked No. 1 on Refinitiv’s Global Diversity & Inclusion Index in both 2018 and 2019.
A version of this article appears in the April 2020 issue of Fortune with the headline “The Conversation: Julie Sweet.”
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