LyondellBasell Industries N.V. (LYB) Earnings Call Transcript & Summary

Next up, we have Kathy VanLandingham. She's the new CIO, congratulations, of LyondellBasell.

Thank you very much, Hunter. Very nice to be here with you today.

Hey, great to be here with you as well, Kathy.

Tell us a little bit about your story in the last year or 2 and the recent role promotion. Congratulations.

Okay. Well, thank you very much. So -- well, I've been with LyondellBasell for too many years to say and for most of my career, LyondellBasell predecessor companies. And I have really been throughout my career -- I'm a chemical engineer by training, but throughout my career, I've really been in the business, so most of my career on the customer side of supply chain and did a little stint in procurement. And just in the last few years, I've been in the IT organization, kind of translating the business needs to the technical needs and trying to get those aligned. So early this year, I got an opportunity to step into the CIO role, and now I'm the former -- formal CIO. So thank you.

Congratulations. You have a lot going on. Tell us about the IT transformation project that you're currently leading.

Sure, sure. So as we started this year, we had our IT strategy that has 3 pillars, which include driving IT excellence through our people, enabling digital through technology excellence and unlocking value through business partnership. So as one of our first actions, early this year, we transitioned the IT organization from a project focus to a product focus. And so this has really included a shift in our culture to focus our IT efforts on outcome and value creation. So where we used to maybe celebrate output, we had delivered a solution, now we celebrate when we really deliver the value, when we get real adoption. So early this year, even as we all went remote in Europe and Houston and we were shut down, we went forward with this change. So we went right ahead into it. And like many of us -- many of our companies, we were reevaluating our work and our projects. Our company made a decision to accelerate projects that delivered value, and we've been highly successful in this space. So our reorganization and our realignment has really made us successful in removing silos and empowering self-directed teams to prioritize and resolve issues with our business stakeholders.

Interesting stuff. And you work closely with our good friend, Anup, I think, right?

I do, I do. I'm in Anup's organization. Anup leads our global business services organization, and we have 4 pillars in our organization. So the IT organization is one of them. We have a digital transformation group. We have our cybersecurity organization, and we have a procurement organization.

Kathy, it's -- we don't often do this, I don't often do this. But Anup's a very interesting individual. He's really a great world-class global executive, right?

Yes.

And you probably have a close relationship with him. What is -- what's the -- when do you know you have the right relationship with your leader? And what does it feel like? And how do you get along?

So Anup is a special guy, as you say, and he's done a great job of building a team that really trusts each other. We're able to be honest -- completely honest with each other. And honestly, I've never been quite on a team like this. So it's energizing. Every day is exciting. Sometimes -- for you, Hunter, you probably know we use Anup sometimes as a verb. We say we've been Anup-ed when he's excited about something and he's just going on something. But it's been a great experience.

Excellent. And I understand you've been working quite a bit on the application layer. What have you been doing modernizing it?

Right. So another big effort that we started as part of our IT strategy and fundamental really to technology excellence is we've been focused on reducing our technical debt. And we've been successful so far in reducing it by roughly 40%. From over 2,500 applications, by the end of this year we'll be at 1,500 applications, and we have an end-state target of less than 1,000. And as all my fellow CIOs know, this is fundamental to implementing our cloud strategy and being successful there.

Awesome stuff, right? And I understand you're also transforming your service delivery and infrastructure organizations. You're busy. You have a lot going on.

We do. And it's been so exciting, but we are transitioning to a more -- to the more modern ServiceNow platform. We're implementing key automations. We're transitioning our infrastructure to a hybrid cloud consumption model with a reduced data center footprint. And yes, so cloud-first strategy, we're on our way.

Sounds pretty exciting. What would you say your biggest challenge is today as a leader?

So I have a global IT organization with between 500 and 700 folks, if I include all of our employees and all of our contractors around the world. And being new in this role, I completely realize now, as we work to change the culture, I have a fantastic leadership team, and we are very aligned in moving the culture. But the only way we'll really be successful is if I get to and I can be inclusive, right, of all 500 to 700 people. That's how we will really be successful in executing our strategy and delivering to the business.

So you're working -- you have literally, obviously, IT operations around the world, 24/7, 365.

Exactly.

That must really be an interesting layer of complexity, both with the global reach as well as the cultural differences.

Well, sure. But you know what, that's also what's going to make us successful. If I can really leverage that diversity and that diversity of thinking, then we will really be successful. So it's key.

Great story. Hey, Kathy, what would you say is your mantra, your go-to, 1, 3 things that you really pride yourself when you think of yourself as a leader in business, a leader in the C-suite, a leader in the Board room, a leader in IT?

Yes. So first of all, I want to engage with my people. I want to talk to my people. I want to listen to my people and hear what they're concerned about. I also -- I'm not technical, so I really try to put things into simple English. I say that all the time to my folks. I'm not technical, you got to be able to explain it to me or you can't explain it to our CEO and our business leaders. So we really like to put things simply so it's well understood. But also, I'm not afraid to get into the details and really drive value.

Awesome. Hey, Kathy, thanks so much for coming on the program. And I can see you as part of our women -- global women in technology summit in a few weeks. You'd be a great...

That would be great.

You'd be a great player there, and I'd love to interview you as well.

Thank you, Hunter.

So we'll be in touch. Great job.

Thank you. Bye-bye.

Take care.

Next up, we have Ken Piddington. Ken is going to lead the panel on Powering Digital Innovation Through Diversity. Ken, great to see you, my friend.

Good to see you, Hunter. Thanks for having me today.

Awesome. Great to catch up. Why don't you take it away, introduce your panelists, and I'll be back when we transition?

All right. Sounds good. Thank you very much. Appreciate it. So Ken Piddington, Vice President and CIO of U.S. Silica. We've got a great group of folks here today, as I see everybody popping in on screen to talk today about powering digital innovation through diversity. So let me just set the stage. And I'll get all my panelists introduced, and we'll have a great conversation. So there's been numerous research studies out there that reveal that companies that are most successful in innovating really draw upon strategies that develop the insights from a diverse team who share different perspectives for problem-solving and how do they tackle those opportunities. And I really found that, that aligns well with my own experiences and strategies I've had at many different organizations that I've been privileged to be a part of. So I'm excited today as we hear from this great group of Houston area business technology leaders and how they best foster diversity and inclusion across the company and find effective ways to leverage the viewpoints of those diverse teams to drive innovation and really gain a competitive edge. And I'm privileged to be joined today by Myra Davis from Texas Children's; Allen Wuescher from Toshiba; Jesse Carrillo at Hines; and Vikas Parikh from LyondellBasell. And I apologize if I messed up your name there. We'll let you reintroduce yourself on that. So why don't we go through and give -- each of you give a brief introduction and give me an opening statement about your thoughts on powering digital innovation through diversity. And Myra, I'd like to start with you.

Hello. Thank you for having me. And I am the Chief Information and Innovation Officer here at Texas Children's. I've been here 18 years and on the technology journey for quite some time. In terms of the question you asked, I think really -- diversity really means, in my opinion, around the innovation team, the diversity of thought that brings to the table and skill sets and individuals. So everybody around the table should not look the same, be in the same title. There should be a variation of roles that we typically exercise because it's important to bring different perspectives around problems that are presented, that are needed to be solved. And so we make it a point to ensure that the diversity of the table is well represented.

Very good. Thank you very much. Appreciate that. Vikas, how about you? Why won't you give a brief introduction and give us your opening thoughts about powering digital innovation through diversity?

Thanks, Ken. So I'm Vikas Parikh. I'm the Chief Architect at LyondellBasell. I started late last year. And prior to that, I was a couple of years at EY in their M&A practice and 15 years at GE in various roles. So the way I think about this, Ken, is diversity, definitely, everything that Myra said. That's a huge focus absolutely, right? I would like to introduce something around building an innovative mindset. Okay. So what does that mean? Simply said, innovative mindset is the willingness and ability of employees to innovate. All right. So how do you tackle that? The ability of employees to innovate is through recruiting, hiring the right folks, right diverse folks, right, and have a global team. The willingness aspect of it, that is where I focus on the inclusive part of it, right? And the way to think about this -- and I'll give you some interesting facts. We have seen -- and I've read some research around a diverse team and an inclusive team has an 11 factor -- multiplier factor, innovative mindset over a diverse team but a non-equal team. So you can imagine the power of equality that it creates and how it helps accelerate the innovative mindset, right? And the way I think about this is in 3 angles, right? How do you think about it? Are you empowering your team, right? Is there trust created within your team? The second is, is the leadership bold enough? And when I say bold enough, are you encouraging the culture around risk-taking and failure? It's okay to fail. And third is, is the leadership action-oriented and inspiring employees, both from an internal and external perspective, to live their core values, right? So this is how I think about the whole innovative mindset and how organizations are going to leapfrog each other with everything equal in driving innovation.

Very good. Thank you. I love how you're framing that. It's not just about diversity, it's about the inclusion to it as well. I think that's fantastic. Allen, how about you? Why won't you give your introduction and give us your opening thoughts on our topic today?

Yes, sure. Thanks, Ken. I'm Allen Wuescher, CIO at Toshiba International Corporation. Toshiba does a lot of things. We mostly focus manufacturing in the States in Houston, Texas on industrial systems, such as motors, drives, UPS devices and the like, but we sell a lot of stuff. Your question related to powering digital through diversity, I think in IT and in digital, a lot of times, the notion can be that one size fits all. And that's not just the case. It isn't ever that way. And I think that's something that companies are learning faster now than ever. And I think that's where diversity really makes a mark on successful companies. Because when it even comes to things like digital, where it may look like a platform can handle any country, the reality is it can't. It has to perform something -- something needs to be different to really serve the customer base in other countries, and that's where having a diverse team matters. Does it work in this country? Yes. Why wouldn't it work in that country? This is why. So that's why diversity matters in the digital space.

Very good. I love it. It's not a one size fits all. We're all different organizations, different industries, different leadership, different needs. I think it's really important that we approach it that way around here -- around this topic as well. Thank you. And last but not least, Jesse, how about you introduce yourself and give us your opening thoughts on powering digital innovation through diversity?

Okay. Thanks, Ken. Great hanging out with you guys again. Jesse Carrillo, I'm the SVP and Chief Information Officer with Hines Commercial Real Estate. I will tell you that the cool thing about being the last one, I can just say all of the above, so much easier to say it that way. But no, I think absolutely everything that everybody said. To me, it's -- what I like to -- when I speak to my team about this is even though I'm a leader and the CIO, I don't always have all the answers and I don't -- I'm not always right. And so I love the idea of having diverse thoughts, diverse folks, being able to challenge, ask questions, give them a platform where they all feel like they have an equal voice. I think Vikas and others said that, empowering them and including. And so I think that's the way I look at it, is we need that input to make us stronger. And then that's why I think we need to surround ourselves with diversity as we work on these digital projects. And I agree with Allen. It's a great analogy. So it's easy to say, well, we'll just implement one big technology, one big ERP and then we're done. It can handle everything. But the truth is, we all know in our careers that's not the answer. So diversity in technology is important as well.

Very good. Thank you. So with so much that has happened this year, this whole lot on this, the HMG summit here today is focusing on diversity. We're hearing a lot about it in the news. I'm curious from our audience, so pop up a poll here, does your organization have a formal diversity and inclusion program sponsored by the CEO? So Melissa, you could put that poll up. That would be fantastic. Here we go. Curious to see everybody tell us what their answers are here as to how you're dealing with this at your organization. Just give it a minute, and then let's see if we can share the results. Let's see where everybody is at. Okay. Let's share that. There we go. So yes, so just over half of the companies do. And others are really thinking about it or discussing it but don't have anything formally set in place yet. So it's pretty common, as I'm finding here today, that companies are really getting into the groove, starting to think about this and plan more for it, make it more formality. I mean I know a lot from my own experience. It happened in for me, just my own mindset as a leader.

And I -- with the group that we have here today, I'm curious, what have you been able to do to foster -- how have you fostered diversity and inclusion within your department and across your company, whether it's at your current organization or somewhere you've been before? And again, Myra, I'll start with you.

So given that I've been here for a long time, I'll just speak about my tenure here because I would age myself if I went beyond Texas Children's. I would say that we've had lots of discussions around the need or whether or not we should have diversity and inclusion individual as a role. I'm pleased to say we're not going that route because this is not a one-person job. I think that's a false representation of the role. I think the way in which we're doing it is really fostering and encouraging. And so that's amplified and amplified unity across the organization to understand what it means to be inclusive and diverse. And I think I like what Vikas said earlier, that it's 11x. When you put the right -- there's a lot of richness to having diversity of thought, opinion, mindset, actions at the table. An organization can move just expeditiously. It can move so fast. And so I -- we are focused on ensuring that we are amplifying unity across the organization so that it's diverse and it's also inclusive of everyone. From the front lines to an executive, it doesn't matter. So I'm really proud of how we are representing it and choosing to do it. And not -- it may warrant a smaller committee just as an oversight, but the movement is across all 17,000 of our workforce, which is a lot more exciting to ensure that we're being truly inclusive.

Very good. I love amplifying unity. I think that's a great statement, one we can all take away from today's conversation. Vikas, how about you? What have you been doing to foster diversity and inclusion in your department and across the organization?

Sure. So I'll double-click into my initial thoughts. And I see it around 6 pillars, and I'll give you an example of each. One is purpose, right? Is the entire organization aligned towards a purpose? That is very important. That has to come top-down. It has to start from the CEO and the leadership team. Second is autonomy. Do you -- are you providing the right empowerment to the team and speak up, right, in various forums, right? And in a culture like ours, which is a very hierarchical, top-down culture, it's a bit of a challenge. So we have to call out on people, right? We have to tell them one on -- in one-on-one setting that, "Hey, you have a lot of ideas, let's bring them up. It's okay to speak up." Third is are we providing -- as leaders, are we providing the right resources, right? And resources by -- what I mean by it, not just internal but external, right? Today, we have a huge partner ecosystem that we should be able to leverage, right? What we are doing at Lyondell is we have a big partnership with Microsoft. We have a big partnership with ServiceNow. We have a big partnership with others. So what we are trying to do is leverage their education, leverage their training program for our employees. Are we inspiring the employees, right? This goes along with the purpose, but inspiration, is there inspiration both -- coming externally? Are the employees collaborating? Are we providing the right mindset? Are we providing the right environment to collaborate, both from a technology perspective but more cultural, right? And the sixth thing would be, are we allowing experimentation, right? And I'll give you a small example. Kathy was on a panel earlier. When she became the CIO, she made a statement out there that it's a very small thing. But if you think about it, "Hey, it's okay to fail on your certification exam. We will repay for your second attempt," right? That itself is -- in an employee mindset, it's like, "Okay. It's okay to fail because my leader is encouraging me to learn and train." So those are the 6 pillars how we think about driving innovation and inclusiveness at Lyondell.

No, that's great. Has it been harder with the pandemic and so many people working remote to really foster the inclusion and the mindset?

I think with our culture, it has been. But then we have found innovative ways of making that happen as well, right? So there's communication, communication, communication is the key. Because of our culture being very hierarchical, speaking less from a leadership perspective and listening more is a key. Probing, right? We talked about the video culture. We encourage that a lot as well. So -- and then we -- 50% to 60% of our employee base is still in the manufacturing plant, right? So wherever possible, we get on a video call with those guys as well and foster collaboration. So yes, various ways of doing it, and we have heard from other panelists around that.

Great. Thank you. So Allen, how have you leveraged the viewpoints of your diverse teams to drive this innovation?

So leveraging is -- just listening, I think I'll -- Vikas had a couple of good points there in terms of inspiration and education. It's just listening to the teams and making sure that we're promoting the right people within our organizations, providing the right aspects of support for people because different people need different types of support. So oftentimes, I think we sometimes may pass up someone who may be a very good fit just because we don't understand what their challenges are. So we need to listen to their challenges so that we understand how we can promote their success. And so that is how we are promoting people within in maybe some different ways than what we've done in the past, which creates more diversity in thinking, which again helps us on our digital road map as it gives us more insight into what different countries think about what it is that Toshiba is doing.

I like that. Listening and understanding, that's really -- that's great. Good advice. Jesse, a little different question for you around this. What have been your challenges that you've experienced in fostering diversity and inclusion at Hines? And what have you done to overcome them?

Well, I mean, I think the challenge is what has been discussed. Being a global firm, there are different perspectives, different ways to kind of listen to your employees and empower your employees. I'd say I'm going to look at it in 2 ways: one is pre-COVID and then post COVID. At Hines, we've always had a very kind of top-down D&I programs, and we actually have a head of D&I and a team. And so over the years, we've always focused on that heavily. And I know, me personally, I've focused on it heavily with some of the charitable organizations I belong with. And so we've always fostered that. I think it was amped up significantly with COVID and all these issues and challenges that happened in the U.S. We can go into different details around all the things that are happening there. But I think it really amped up really the need to really bring this to the forefront. So I think that's kind of how we're structured here. I'll say for me as a department, again, it's focusing on empowering and promoting and helping our current team members but just as importantly, the succession in the pipeline. I think, again, I mentioned it briefly. I belong to a lot of organizations. I know Myra and Allen and Vikas, you belong to organizations. I know I belong with some with Myra. Being able to go back and hopefully serve as a little bit of a role model and then encourage the younger generation to get into our fields, to really look at technology a little differently, it's not just playing on a device. Maybe it could be if you work for a gaming company, but again, getting people excited about IT again. I think we've gone through ebb and flows around IT and what is the CIO role and what do I want to do in technology. And I think someone said in a previous panel or -- that I think this situation, the COVID situation really has brought the IT leadership and our IT teams to the forefront around the importance of what we do. We always said we were doing good stuff and preparing the company for the worst-case scenarios. Well, we've seen one of the worst-case scenarios and we've done it. And so how do I then turn that into messaging back to the next generation of leaders, both that I have currently or bringing up the pipeline and making sure that it's a diverse set of people coming and being interested in the technology. So again, and I think part of it is, Hines is structured that way. I mean we've got great programs in place and continue to communicate and educate. But me personally, just being able to reach out to the communities and encourage more interest in technology and IT, I think, is the way I'm doing it.

Very good. Yes, I know how involved you are in all those programs externally. And it's a great point about we can't -- we have to think about our current teams and ensuring that they're feeling included and understanding what we're doing today and also building for tomorrow. So very good. We're getting close to our ending time. So I wanted to give everybody like a quick 1-word or 2-word piece of advice you'd love to give to the audience on this topic and like what should we do. And Vikas, I'll start with you. Just 1-, 2-word, quick piece of advice to close things out.

I would say focus on your team and fostering inclusiveness and building that trust. And empower the team and get out of their way.

Okay. Great. Thank you. Allen?

Yes. I'd say we have to truly focus and have a better focus on diversity going forward. It's a key metric for how we're successful in the United States in general and I think these other countries. Because we're all going virtual, they're going to figure this out, and they're going to start becoming more virtually diverse than we've ever seen them. Competitive advantage, take advantage of it while we're here in the U.S. and get diversity on your teams.

All right. Sounds good. Jesse, quick closing statement and closing -- couple of words.

Yes. Don't stop the conversation. I mean I love these kind of panels because it keeps the conversation going. This conversation should never stop. And hopefully, in our careers, at some point, we could say it's done. But reality is it should never stop and it keeps going. So don't stop.

Great. Thank you. And Myra, final closing -- just a quick statement. You're still on mute.

Sorry. Yes, I would say all of the above. And more than anything, I think during times like this, I would encourage everyone to be open. And sometimes that word diversity just drives sort of an immediate thought. I would really challenge people to say let's value differences, how do we be open to valuing differences.

Very good. Thank you. Well, thank you, everyone, for participating today. Greatly appreciate it. I think it's really good, as we think about building diverse teams as just part of the equation. We've also got a support environment and culture of inclusion really making people feel part of the team in order for the company and themselves to be successful. So thank you, everyone. Hunter, thank you for having us.

Thank you, Ken. Great to see you. Great job. Myra, Jesse, Vikas and Allen, awesome. Really appreciate your engagement. Thank you so much, and stay well. Thank you. Hopefully, you can stay with us to the end of the program.