Adobe Inc. (ADBE) Earnings Call Transcript & Summary

So look, a big thanks for all just for Zooming in today. Unprecedented times, unusual times. But let's dive right into the dialogue and let's talk about the intersection of innovation, reimagining and reinventing the customer journey. And I can't think of a better company right now to hear from than Adobe. And welcome, Ani Nayak, the Head of Business Process Transformation, Document Cloud. Adobe has done an insane transformation and complete reimagining the business model over the past 10 or 15 years. I remember Ani getting software in a box, and now, of course, it's all cloud.

Yes, yes. It's been truly a journey for us at Adobe and for our customers. Certainly a journey that's been fruitful. And we're very proud of the move we made from box to subscription.

Ani, you have a brilliant management team, senior management team and a brilliant CEO. I've seen him several times on CNBC talking about the growth of the company. What is it about the Adobe vision or mission that inspires you so much to be such an enthusiastic researcher and passionate about the intersection of people and technology?

What I find really amazing is just how well we've been able to execute. I think a lot of it is attributed to the fact that we sort of stayed true to our strategic plan and our strategy. A lot of it is irrespective of whatever macroeconomic situation was happening. It's very important to kind of call out that we've been able to adapt to digital in sort of a marathon fashion. So if you look at the goal of adapting to digital and how to get there, it's important to be efficient in transformation, both with the modern workplace and the overall go-to market. But rushing too quickly to make the change would only theoretically result in failing to reach the metaphorical finish line. And so it's really important to look at, if you look at a success story like Adobe and many other companies that are going through it right now, preserving the strategy of transformation, what's powering the journey, why are you undertaking that journey, and then being continuously agile in setting the priority for whatever milestones you would need to hit to capture return on investment and kind of be focused on continued growth. So yes, it's been truly fantastic to be -- to see that happen at Adobe and then see what that means as far as how our customers are benefiting.

So Ani, we've known this for a while now. Lead, reimagine the customer journey, all of a sudden, a pandemic jumps in the middle of the current state. And now people really need to think differently, visualize and create a new vision for the company and act differently. What are the top recommendations that you would suggest when you look at that road map?

Well, I think it's important to look at the history of what's happened this year. A lot of investments have been made so far to support a distributed digital workplace. That's been sort of the reactive goal. And so since the start of this pandemic, we've seen a combination of industry-specific initiatives, leveraging digital, coupled with the general need to support a truly remote -- majority remote workplace. And so irrespective of business-to-business or consumer-facing, many different companies have had to reprioritize and accelerate investments. And those investments have been made into collaboration, productivity, automation tools to provide secure efficient ways of enabling employees to do their work. So now moving forward, the next phase is really about customer and digital experience. And so this means optimizing process, coupled with defining and deploying truly digital omnichannel experience to create more efficient and intelligent means of what we like to call interactions. And that really kind of falls back to your introduction around empathy and how humane a lot of this could be. It's all about the interaction, the digital interaction. And this is really going to pay dividends to any company that's approaching this time through a data-driven approach. So the modern consumer is very technology-savvy, if anything, because of sign of the times. And so typical digital commerce and web-based experiences have boomed. But with that level of demand has come the need to really double down and focus on a tightened-up application ecosystem and a unified data model. So everything from filling out a form to signing something to whatever the interaction really is, that all of that needs to support the enterprise application stack and subsequently, the overall experience that, that process is enabling. What I think is really exciting is how technology leaders have been approaching this very unprecedented time in that it's an opportunity. It's a catalyst to reassess potentially stale processes and legacy architecture and kind of pull forward certain investments that may have been farther out in the road map. So as far as looking ahead tactically and some of the steps that leaders could be taking, I think a lot of it is about preserving the strategy and sticking to the plan. I have -- and I mentioned this on the last -- when we did, I have 6 typical areas that I always recommend that my customers focus on, my leaders focus on in going through a transformational journey: one is to not rush the market and thereby creating a little bit more chaos for your customers; two is to prioritize stakeholders and communication with your shareholders; three is to be very responsive in the feedback that you want to garner, but very steadfast in your commitment to your plan; four is to always be ready for change management at any step in the journey that you're going through; five is to focus on solving challenges through value creation rather than being responsive and reactive; and finally, six is being ready to always rechart whatever the course is that you're walking on or sailing on, as I like to say, but staying true to where you need to end up being.

Interesting 6-point model. Thank you. When you think about disruption, digital disruption, have we ever in the history of the last 30 years of digital transformation seen a more disruptive time?

No, I don't think so. There's been a variety of different -- historically, there's been a variety of different situations that have contributed to disruption and contributed to growth at companies. But nothing to the tune of what's happening now, what's happened this last year. I have to believe fundamentally that many companies had a plan for digital transformation in the works and things were kind of chugging along. But the unprecedented time has created such an acceleration of those investments that were probably a little bit further out on the horizon. I was reading a couple of articles from different consulting firms like McKinsey and Deloitte and Accenture and really brilliant research comparing how quickly the disruption has happened now. And you can't even compare it to periods of wartime where technology investments have certainly increased. Right now, I think the global workforce has really changed the very fabric and nature of how business is done. I think that the fact that everyone, just putting it bluntly, everyone is remote and needs to be remote, there's sort of -- the economy is slowly picking itself back up. And there's been some setbacks, but it's trending towards a recovery. And that doesn't mean that everything is going to go back to normal. If anything, what this has really taught us is this whole concept of new normal has heavily changed. And more and more, companies are waking up to the reality that business can, in fact, be done in a much more digital manner. And in fact, that doesn't mean there's leakages in security or potential risks that were unforeseen. If anything, it just means that there's opportunity to do business more efficiently and at much more scale than ever before.

Really good advice, really good input, Ani. How can people get in touch with you, you or your group?

So you can reach out directly to me on LinkedIn. You could e-mail me at [email protected]. Happy to facilitate any discussions internally with anyone at Adobe who would probably be more smarter than I am.

And you do, do a kind of a whiteboard customer journey mapping. Don't you?

Very much so, yes. We -- that's part of our methodology as far as the team that I'm on is we focus heavily on process optimization as it kind of relates and correlates with the overall experience that you want to foster. So understanding current state, what are the gaps, what are the areas you could improve, what makes sense. And a lot of that actually takes in a lot of third-party research sort of through the lens of what a consultant would do.

Excellent, Ani. Thanks so much for coming on the program. And thanks for having Adobe support the HMG platform and network in this summit. Great to see you.

Thanks for having me. Good to see you.

Looking forward to seeing you again in person soon in the Valley.

Absolutely.

Excellent.