Leadership in Action > Inside Adobe's future-proofing transformation

10 Years Ahead of the Market

For more than four decades, Adobe has been changing the way we work and create. And the company behind groundbreaking products such as Adobe Photoshop and Adobe Acrobat has itself been dedicated to constant transformation. That evolution has led Adobe to broaden its focus on the enterprise business-to-consumer and business-to-business markets—a strategic effort that has helped fuel a fourfold jump in revenue during the past decade.

Those results alone should catch the eye of any growth-oriented company. But the real lesson for business leaders is in how Adobe accomplished one of its largest transformations. It was a mix of innovative product development, an intelligent acquisition strategy and an ambitious digital transformation journey. The transformation was also the result of strong collaborations, including support from longtime partner EY.

The outcome has helped Adobe future-proof its business by expanding its capabilities, opening up new revenue streams and reaching both business-to-consumer and business-to-business customers. “We believe we’ll be able to take all of the innovation that you currently see, whether it’s in the world of artificial intelligence or in the metaverse or in enterprise technologies, and put that together to serve all the audiences in every customer segment,” says Anil Chakravarthy, president of digital experience business at Adobe.

Planting the Seeds of Success

For many companies, building resilience often relies on integrating new technologies and expanding workforce capabilities. But creating the foundation for future success can involve much more than that. “It can also mean exploring new markets, new products, new alliances,” says Mitch Berlin, vice chair of strategy and transactions at EY Americas. Adobe has done this through a thoughtful mergers-and-acquisitions strategy. Inorganic growth through M&A can be a powerful way to quickly transform an organization, but making the right acquisitions requires foresight. That’s something Adobe has shown time and again. “They understand where the future is going, and they make strategic acquisitions to plant a flag in that future landscape,” Berlin says.

EY has been a great partner for us. They were one of the earliest implementers of our real-time B2B customer data platform and helped us in our journey to get other B2B companies to adopt the program.

Anil Chakravarthy

President of Digital Experience Business, Adobe

Chakravarthy points out that it was nearly 15 years ago that Adobe’s leaders foresaw that new technology would change the world of marketing. Adobe understood that marketing wasn’t simply using new tools; instead, the new tools were driving a seismic disruption in how companies reached consumers and other businesses. These tools enabled marketers to provide customers with experiences tailored to their needs. For companies, this shift unlocked powerful new opportunities for growth. “Companies that are focused on experiences don’t have to compete solely based on price. That’s what makes the difference,” Chakravarthy says.

Recognizing emerging trends early has allowed Adobe to outpace its peers and plant seeds of growth that will benefit the company years down the road. “If you think of Adobe Experience Cloud, digital marketing is a market we created,” Chakravarthy says. Adobe entered this market beginning with the 2009 acquisition of Omniture, which brought it what is now Adobe Analytics. The move toward enterprise continued with organic innovation, as well as a handful of additional acquisitions, most recently of e-commerce platform Magento, and marketing automation company Marketo, in 2018.

How EY can help

Transforming Internally

 

Critical to Adobe’s shift to the enterprise market has been its own internal digital transformation. The good news is that Adobe’s own products are ideally suited to facilitating transformation. Adobe made an intentional effort to incorporate its products more deeply into the company’s workflows. That helped create more efficient processes, and also gave Adobe a larger team of users to continuously evaluate and improve on its products. “If you walk around an Adobe building and see displays on different signage, that’s powered by Adobe Experience Manager,” says Cynthia Stoddard, senior vice president and chief information officer at Adobe. “We also use tools like Adobe Creative Cloud and Adobe Express to create the most powerful content that you can have.”

 

To support Adobe’s internal transformation, EY worked with Stoddard and her team to establish a change management office, which brought a valuable perspective throughout the process. Stoddard, who is a member of EY’s Tech Icons Council, a network of technology executive leaders, says, “You need sounding boards. It’s important to have partners that are actually outside of the company and have industry knowledge.” She adds of EY, “They are very strategic thinkers. They have a lot of practices that I have the ability to draw upon at my fingertips. They help me to think in a different way and really push my organization.”

 

Adobe’s transformation has also been instrumental in improving EY’s own operations by focusing on accelerating B2B marketing technology maturity and delivering an optimized customer experience. As an alliance partner, Adobe collaborates with EY clients every day to develop a human-centric, digital-first business strategy, as well as executional road maps that turn strategy into action.

 

Ultimately, Adobe’s willingness to continually transform for the future comes from having an “investor mindset.” Good investors look at their portfolio dispassionately to decide what investments to buy and sell. “Adobe does something similar,” Berlin says. “They look at their businesses as a portfolio of investments, and they’re regularly evaluating that portfolio to understand whether they should invest in or divest from a line of business.”

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EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.