Unleashing Innovation Through Co-Creation: Microsoft's CEO Co-Innovation Program

To comprehend the intricacies of a bakery, firsthand experience with the ovens is crucial. To appreciate the products, it is essential to interact with the individuals behind the dough. But to truly grasp the operation, the ultimate step is tasting the cookies. This approach was adopted by Judson Althoff, Microsoft's executive vice president and chief commercial officer, during his visit to Grupo Bimbo, the world's leading baking company. Althoff's endeavor exemplifies the CEO Co-Innovation program (COIN), a unique partnership initiative between Microsoft and select customers, where technology exploration takes a backseat until the customer's goals and challenges are thoroughly understood.

Unlocking Innovation through Co-Creation: Inside Microsoft's CEO Co-Innovation Program

Introduction

To comprehend the intricacies of a bakery, one must witness its ovens in operation. To appreciate its products, one must connect with the artisans behind the dough. But to truly grasp its essence, one must indulge in its cookies.

This profound understanding guided Judson Althoff's recent visit to Grupo Bimbo, the world's leading baking company and a valued Microsoft customer, to gain firsthand insights into its business objectives and technological ambitions.

A Journey into Innovation

Althoff, Microsoft's executive vice president and chief commercial officer, traveled to Grupo Bimbo's oldest factory in Mexico, a "museum piece" brimming with vintage machinery, as described by a Grupo Bimbo executive. However, following a digital upgrade, this facility has transformed into a financial powerhouse.

Donning a hair net in the Guadalajara factory, Althoff embarked on a tour of the mixers, slicers, and conveyor belts, engaging in conversations with associates and managers. He sampled an array of baked goods, savoring their freshness straight from the ovens. Company leaders took note of his keen observations.

"To become true partners to our customers and empower them with pragmatic innovation, we must immerse ourselves in their daily operations and comprehend their unique challenges," Althoff reflected on his visit. "Through firsthand experience, we were able to leverage Microsoft's expertise to assist Grupo Bimbo in reimagining its operations, a goal we share."

Juan Pajón, Grupo Bimbo's global senior vice president of business technology, emphasized the significance of this approach: "The only way to truly grasp what is happening is by engaging with the people on the line, comprehending their concerns, their ideas, and the problems they face. Genuine innovation is born from these interactions."

Co-Innovation: A Catalyst for Progress

Althoff's visit was more than a delightful encounter; it was the culmination of an extended, customized collaboration between Grupo Bimbo and Microsoft, a novel partnership model pioneered by Microsoft called the CEO Co-Innovation program (COIN).

Several times annually, Microsoft Chairman and CEO Satya Nadella and his senior leadership team collaborate with the chief executive officers and top executives of selected customer companies. Together, they explore and define groundbreaking solutions or product features that are both visionary and market-ready.

COIN discussions are meticulously tailored to each customer's business opportunities. However, what truly sets these gatherings apart is that the topic of technology is not introduced until there is a shared understanding of the customer's objectives and underlying motivations.

Each COIN engagement spans four to six months, ultimately involving a select group of engineers, developers, and industry experts from both companies who craft solution concepts that can ultimately bring those ideas to fruition. COIN sessions may be conducted in person, via Microsoft Teams, or a hybrid of both.

COIN was launched in 2018. Since then, nearly 40 Microsoft customers have capitalized on this unique program to develop and launch their innovations, ranging from utilizing data to enhance patient outcomes in hospitals to creating an autonomous method for transporting people.

At its core, COIN aims to accelerate customers' aspirations through the spirit of co-creation. Critically, it is not a Microsoft sales tool. There are no contracts to sign or commercial targets to achieve. The focus is squarely on understanding customers' business needs and expediting their fulfillment, rather than solely promoting Microsoft's technology.

"This is a harmonious marriage of engineering and business, and it's a beautiful thing," said Deb Cupp, president of Microsoft Americas. Cupp was one of the executives responsible for conceiving the COIN concept and remains an active participant.

"The experience has been remarkable, observing customers engage in open dialogue, in a safe environment, where they are free to dream about what is possible," Cupp continued.

The freedom to engage in free-flowing conversations around novel business ideas was an eye-opening experience for many customers, particularly those accustomed to a more rigid approach to digital modernization, Cupp noted.

"I believe we've opened their eyes. We've fostered an environment that has instilled in them a sense of security, making innovation less daunting than it once may have seemed. We've empowered them to embrace creativity and ideation. It's been a joy to witness their transformation."

Exploring the Future with Generative AI

As generative AI continues to evolve, select companies will have the opportunity to collaborate with Microsoft executives through COIN to explore its transformative potential for operations, elevating customer and employee experiences, and accelerating the pace of innovation, explained Cindy Rose, chief operating officer for global enterprise sales at Microsoft and the current executive responsible for COIN.

Customer Success Stories

To provide insights into the program, three customers shared their experiences with COIN, shedding light on their vision during collaboration, the solutions they ultimately developed, and the lessons they learned.

Amadeus: Empowering Smarter Business Travel

• Company: Amadeus
• Industry: Travel technology
• Location: Madrid, Spain
• COIN participation: November 2021 to March 2022
• Vision: Seize a new era in business travel

In late 2021, as COVID-19 vaccines became widely available, many U.S. and European companies began reinstituting employee trips. During 2022, the rate of business travel doubled in those regions. In 2023, companies reported that their domestic and international travel had reached at least 70% of their pre-pandemic levels, according to a global survey.

The resurgence was underway. However, a new reality accompanied this upturn: Business travel would undergo greater scrutiny compared to the pre-pandemic years.

During their initial COIN meetings, executives from Amadeus and Microsoft discussed how employers would now need to justify the value of their trips, including the environmental impact. These discussions included Wolfgang Krips, senior vice president of corporate strategy at Amadeus.

The group identified an opportunity: A more efficient way to manage costs and carbon emissions. Unlike personal travel, business trips frequently involve groups of employees traveling to the same city for a particular event.

"What if we could move away from the traditional method of booking travel individually, inputting expenses, and receiving reimbursement?" Krips recalled asking. "What if we adopted a model where we plan the trip collectively, coordinating flights, hotels, and shared ground transportation?"

Process: Both teams quickly realized that they already possessed a secure platform that could accommodate their vision. They decided to integrate Amadeus' Cytric Easy, a travel and expense management tool, into the Microsoft 365 suite, which includes Teams.

Engineers from both companies worked on the integration. Business representatives explored monetization strategies and developed a market plan. Eventually, Microsoft employees tested the solution.

"By (Microsoft) embracing early adoption, it helped solidify our solution," Krips said. "We received immediate feedback on any issues that arose. It was an invaluable learning experience."

The collaborations with Microsoft also facilitated market access by connecting numerous Microsoft customers to the Amadeus team, Krips noted.

Solution: Cytric Easy integrated within Microsoft 365, enabling businesses to seamlessly plan, book, and track travel expenses.

Key Takeaway: "Everyone engages as equals," Krips stated. "This is not the typical (sales-driven) deal where you sign up for our cloud program and then expect us to deliver it for you. No, this approach brings out the best in both of us."

Equinor: Accelerating Offshore Wind Farm Design

• Company: Equinor
• Industry: Energy
• Location: Stavanger, Norway
• COIN participation: August 2021 to January 2022
• Vision: Devise a faster and more efficient method for designing offshore wind farms

Immense white turbines standing tall at sea, anchored by underwater foundations, their blades spinning in offshore breezes, have become a familiar sight. Average wind speeds tend to be higher over water than on land, enabling these farms to generate more electricity.

However, the preliminary work required to analyze potential windfarm locations can be arduous. Engineers must make numerous assessments: What platform and turbine size are appropriate? What are the wind and wave patterns? How should the wind farm be laid out? How much electricity will it produce? Is it a worthwhile investment?

"So we asked ourselves, why don't we digitize and automate that entire early phase? Why not leverage digital simulations?"回忆Alvin Shaffer，Equinor的合作关系、生态系统和智能主管。

Process: Engineers from Equinor and Microsoft joined forces to accelerate the development of a digital platform capable of managing numerous design iterations, ultimately automating the site-assessment process.

"The sheer volume of data required for this analysis is significant," Shaffer explained. "You need a platform capable of orchestrating and handling all of that work."

For their solution, the group relied on several Microsoft technologies, including Azure Digital Twins, which creates virtual models of the physical world, and Azure IoT, which connects, monitors, and controls IoT devices.

As is typical of a COIN engagement, conversations also took place between Nadella and Equinor CEO Anders Opedal and among senior leaders from both companies.

"To be able to be on a call with Satya, to hear his questions, engagement, and suggestions, that was pretty impressive," Shaffer said. "You don't typically see that at the CEO level when two companies come together."

"His enthusiasm motivated me to push (the development) from my side," he added.

Solution: Digital wind farms

Assessments and