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Episode #32: 'Creating A Culture Of Innovation' With Josh Gould of Duquesne Light Company - [an Energy Central Power Perspectives™ Podcast]

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The ‘Energy Central Power Perspectives™ Podcast’ features conversations with thought leaders in the utility sector. Each two weeks we’ll connect with an Energy Central Power Industry Network...

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  • Apr 13, 2021 12:45 pm GMT
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This item is part of the Special Issue - 2021-04 - Innovation in the Power Industry, click here for more

In the business world, innovation has risked turning into more of a buzzword than an actual guiding principle. But in a rapidly evolving industry like utilities, innovation can have real impact on operations, on customers, and on the way the entire sector is set up. As such, innovation departments have sprung up across various power providers, seeking out new ways to modernize grid operations, to transform the customer-utility relationship, and to enhance the 21st century utility goals of clean, reliable, and affordable energy. Innovation in these departments is no hollow promise, but something to tangibly deliver.

The guest on this latest episode of the Energy Central Power Perspectives Podcast lives and breathes innovation for utilities, and he argues that to truly embrace innovation a utility must embrace it as a part of the pervading company culture. Josh Gould is the Director of Innovation at Duquesne Light Company, and in that role he’s made it his personal mission to weave innovation culture through every part of the utility business. And while certain outcomes seem more obvious to be measured, Josh shares with host Jason Price and producer Matt Chester how innovation culture can in fact be tracked. His pitch, in this episode, is all about starting innovation at your utility today, so if you need inspiration or ideas to bring to your CEO, you’ll want to listen to Josh’s call to action here!

Prefer to Read vs. Listening? Scroll Down to Read Transcript.

Thanks to the sponsors of this episode of the Energy Central Power Perspectives Podcast: West MonroeEsriAnterix, and ScottMadden

 

 

Key Links
Josh Gould’s Energy Central Profile: energycentral.com/member/profile/josh-gould

Why traditional thinking on innovation culture must evolve: energycentral.com/c/um/why-traditi…ture-must-evolve

 

TRANSCRIPT

Jason Price: 

April is innovation month at Energy Central, and the content on the website comes from all of you, our members who are sharing knowledge, publishing papers, and generating conversations on innovation at utilities. On today's podcast, with the power of perspectives, we will talk to a thought leader whose very job title is innovation. He writes about the crossroads of culture and innovation at utility, and this subject is gaining greater attention in recent years, as the utilities industry modernizes and transforms, a theme we find many of our guests revisiting time and again. So let's get started. I'm your host Jason Price of West Monroe, coming to you from New York City. I'm joined by my podcast producer and Energy Central's community manager, Matt Chester. Matt, are you ready to dive into the world of innovation with our guest today?

Matt Chester: 

I sure am, Jason. And speaking of innovating at Energy Central, we're introducing a fun new twist to this podcast format where we're going to get to know our guests a bit better on a personal level. So be sure to listen through to the end to hear us grill Josh with a handful of lightning questions to hopefully keep him on his toes.

Jason Price: 

Absolutely. I'm looking forward to it. Well our guest today is a thought leader who has written and talked extensively about this topic. That's a perfect fit for this month's theme of innovation at Energy Central. We are speaking about Josh Gould, director of innovation at Duquesne Light Company. As we will hear, innovation is not only an aspiration, but actually a cultural driver that is woven through every single part of the utility business. Josh's approach to innovation is an exciting one, and likely his enthusiasm for energy innovation will motivate all of you to go right up to your CEOs and push through that same type of culture where you work. But before we let Josh loose, we'd like to give a word of thanks to the sponsors of this podcast who made this episode possible.

Jason Price: 

To West Monroe. West Monroe works with the nation's largest electric, gas, and water utilities on their telecommunications, grid modernization, and digital workforce transformation. West Monroe brings a multidisciplinary team that blends utility operations and technology expertise to address modernizing aging infrastructure, advisory on transportation electrification, ADMS deployments, and DER and cybersecurity. To Esri, an international supplier of geographic information, GIS software, web GIS, and geo-database management applications. To Anterix, focused on delivering transformative broadband that enables the modernization of critical infrastructure for the energy, transportation, logistics and other sectors of our economy. And to ScottMadden, a management consulting firm serving clients across the energy utility ecosystem. Areas of focus include transmission and distribution, the grid edge, generation, energy markets, rates and regulations, corporate sustainability, and corporate services. The firm helps clients develop and implement strategies, improve critical operations, reorganize departments and entire companies, and implement myriad initiatives.

Jason Price: 

Our podcast guest today is Josh Gould, the director of innovation at Duquesne Light Company. Josh has been in this role, standing up the Duquesne Light Innovation center, and infusing a flavor of innovation into everything the company does since late 2019. But his focus on innovation stretches back further than that. Prior to Duquesne, Josh launched the innovation hub at con Edison. And prior to that, he worked at ARPA E. He is a certified innovation practitioner and I'm convinced that he might even have the word innovate on the inside of his eyelids so it's the first and last thing he sees each day. That's how deep his commitment goes. Josh recently shared an article in the Energy Central community all about innovation culture. While culture, he writes, has become both a buzzword and something of Nirvana, he finds that culture actually can, and should be measured and tracked, especially what he calls innovation culture. Josh Gould, welcome to the Energy Central Power Perspectives podcast.

Josh Gould: 

Thank you, Matt and Jason. Thrilled to be here.

Jason Price: 

So Josh, for those who maybe haven't read your article, talk us through what you mean by measuring culture and measuring innovation. How exactly do you quantify these hard-to-define ideas?

Josh Gould: 

Yeah, there's a ton of talk about culture nowadays, and rightly so. It's seen by everyone from community activists to military leaders as how organizations accomplish great things. And at the same time, there's a lot of talk about innovation. I mean, innovation is what gets us lifesaving vaccines in less than a year, so it's pretty amazing. So these are two things that everyone seems to want. The right innovation culture and the right organizational culture, and they go hand in hand. You get culture wrong, that can squash innovation at your company and at your utility. You get it right, you can get game changing results with relatively less effort, less money than your competitors. So I don't think anything of what I just said is really news. Companies of all kinds, they seek innovation, they seek the right culture, and they're starting to pay more attention to it and finding ways to measure it, in particular measure culture through things like employee surveys.

Josh Gould:

The tough thing, though, is that culture is ultimately, in my opinion, an outcome. It's a lagging indicator that's really the result of thousands of decisions, actions, incentives, even the words that are used within an organization, that all of that adds up to this nebulous thing we call culture. And you can look at innovation as the same way. You get a really great innovative product or service, it creates business value. That's great. But by the time it's done that, it's also a lagging indicator of all the risks that people have taken to get that innovation to the market, all the courage that people have demonstrated by bringing that product to market. So the results of innovation or also a lagging indicator. So what I talk about in the article, and what I'm guessing we're going to talk more about today is how I think organizations should focus more on leading indicators of both culture and innovation, and ultimately measuring those leading indicators is what's going to get you the results you want from a culture and innovation standpoint.

Jason Price:

Okay, but why should our listeners care? Why is this even important?

Josh Gould:

Yeah, good question. I don't think it's an exaggeration to say that culture is absolutely necessary for anything companies, or utilities for that matter, want to do so. You want to be a safer utility? Culture needs to be a part of that. You want to be a more diverse and inclusive utility? Culture needs to be a part of that. You want to be a more nimble, agile, and innovative utility? I would argue culture absolutely needs to be a part of that. There's that famous saying that culture eats strategy for breakfast, but I think culture probably takes its lunch too. So again, any vision that you have, anything you want to achieve as a utility, culture has to be a part of that, so I think we need to think rigorously about what culture is and how to measure it.

Jason Price:

Okay, but let's talk about the tools. What sorts of tools do you use to measure culture of the company? And how's it changing? Do you bring in outside experts, turn to employee satisfaction surveys, conduct focus groups and one-on-one interviews? Share with us, what are some of the types of best practices to get to the heart of culture?

Josh Gould:

Yeah, what I've seen, I think what's conventional wisdom, and it's not wrong by the way, but what's conventional wisdom and what I've seen in many organizations is we measure culture by doing employee surveys. So again, don't get me wrong, those surveys are important, they're necessary. If you're not doing them, I think you should. And if you do them well, they give you a good reading on what your current culture looks like. But again, just as culture is an outcome or a result, in my mind, an employee survey is necessary, but it's a lagging indicator. I'd argue it's even more important to measure and improve the inputs that create that culture. But really the first step is, you want to improve your culture, you want to have a better culture, I think the first thing you need to do is answer two questions that seem obvious, but you'd be surprised how rarely it's answered.

Josh Gould:

So the first is what culture do you want at your utility? And the second is what are the behaviors that you believe are going to produce the culture that you want? So again, what culture do you want, what behaviors will produce the culture that you want? So just a specific example here at Duquesne Light, we want and have made explicit we want a culture where everyone is empowered and enabled to innovate. That sounds like a platitude. That sounds like very general and kind of like motherhood and apple pie there, but we try make it very real by developing metrics that actually measure whether we're progressing towards those goals, and we report and update those measurements quarterly. So for instance, a culture where everyone is empowered and enabled to innovate is also a culture where equity, inclusion, diversity is a core part of how we achieve that mission.

Josh Gould:

So we measure diversity in a variety of ways. We measure it by the diversity of our innovation project portfolio, so what are we working on and how diverse is that portfolio? Whether that portfolio is touching our diverse organizational objectives. So that ranges from anything from exportability to sustainability and a whole bunch of customer-focused efforts in between. The diversity of teams, people in departments who are leading those efforts. We also measure innovation culture by measuring what we call our footprint. That is the total number of employees with whom we've interacted on innovation in a given quarter and the number or percentage of those touchpoints that are new. So again, those are just a couple examples of how you take something nebulous, like a culture and like an aspiration that you want to have from a cultural perspective, and then actually break it down into something tangible that you measure and improve at a regular basis moving forward.

Matt Chester:

So Josh, one question that I have is how do you get your foot in the door with decision-makers on this? Measuring culture specifically seems like an idea that makes great sense when you're explaining it, but when first approaching maybe some old school thinkers in the industry, you might be quickly waved off. How do you push through that and get these good ideas in front of the right people?

Josh Gould:

Yeah, so it's a great question. And while I wrote an article about culture, we're talking about culture, I think it's absolutely critical. I actually don't think you lead with culture if you want to build an innovation capability at your utility if you haven't done it before. So I actually think you need to lead with showing people how it's done, with leading by example, so taking that initial project or projects and driving it to completion. So you actually show people this is what it looks like. You need to stand up a capability to identify the culture you want and measure it. But I would argue that you bring some of those old-school people along, or maybe some of those skeptics along by showing them. You can talk all you want, but where you show people, that's where I think you really start to win them over.

Jason Price:

Josh, talk to us about risks. Are there any risks associated with looking to measure and track innovation and culture? For example, are there any concerns of people making changes that might not really be beneficial because the score suggests otherwise? Do you have any examples of this?

Josh Gould:

Yeah, one classic example I see is organizations making their innovation team pay for themselves over too short a period of time. So you want the innovation team to pay for themselves in six months, a year, something like that. Don't get me wrong here, I think innovation needs to be held accountable from a quantitative standpoint, and I think it's okay that an innovation or an innovation function has a savings target. But what happens is if you stand up a team and stand up some investment in and propose some investment in that team, which is necessary, if you expect them to pay for themselves in a year, that's going to create some really perverse incentives. In particular, you're going to have that team doing things that are sure things, they're not taking risks, they're going to be likely to duplicate what the core business does or is already doing. You're going to find that team maybe having arguments over accounting for what portion of that savings they've contributed to a broader company initiative, when it should be just a collaborative effort amongst the team.

Josh Gould:

So I guess the overall takeaway is just be very thoughtful about what I would call the second order impact on metrics. Meaning if you measure that, then what happens? And I would argue, if you measure a cost savings target, that's great, that's fine. Keep those expectations realistic in the short term. I think, again, quantitative metrics are necessary. Cost savings metrics, totally fine. But if you're starting an innovation effort from scratch, you're going to need to keep your expectations realistic about that team paying for itself immediately. Can it pay for itself over time? Sure. Do you want to expect it to do it in year one? You don't, because that's going to create, again, some really perverse incentives.

Jason Price:

Now you've spent some time at a variety of different organizations throughout your career, of course bringing your own unique flavor of innovation to each one of them. As you look back, can you compare and contrast the different cultures that you've been in and how they've influenced the direct progress towards innovation?

Josh Gould:

Absolutely. So I was really fortunate to spend some time in my career at ARPA-E, which for those who aren't familiar, ARPA-E is the moonshot agency within the Department of Energy. So there's an analogy in the department of defense with DARPA. DARPA were the people that actually did invent the internet, they invented drones, GPS technology all spun out of DARPA, whole bunch of robotics stuff. And ARPA-E is its analog in the Department of Energy. Probably no surprise that ARPA is a very innovative place. And if I were to touch on what makes it so innovative, there is an expectation of failure that essentially everyone has at that organization. And I want to be really clear what I mean when I say failure. Failure isn't necessarily... A failure of the entire program, failure of the entire agency is totally unacceptable, and that's not what I'm talking about.

Josh Gould:

What I'm talking about is you run a program, given a focus on a given area, and you have 10, 15 bets in that program. You're expected going in that... I don't know exactly what the number is, at a minimum a significant minority of those investments are just going to fail. They're not going to work out, because you're trying to do really big game changing things. So I'm probably not going to shock anyone by saying that utilities don't have that same built-in expectation about failure as it relates to innovation. And look, some of that is good, and some of that is based on the business model that utilities have. If you went to a utility customer who expects very high levels of reliability and say, "Look, customer, you need to get comfortable with accepting failure as it relates to reliability," that conversation is not going to go well. So I think it's an unrealistic expectation that a place like a utility is going to have the same innovation culture that a place like ARPA-E does.

Josh Gould:

But I do think you can move along that spectrum where you have a sandbox, what I would call a sandbox where you can experiment with some projects, experiment with some technologies and activities. And you set that expectation upfront that failure is a natural and acceptable part of that process. Again, not failure of the program as a whole, but failure of a couple of projects that you're doing. That, to me, is the key difference between organizations that are innovative and organizations that aren't. Organizations that are innovative accept and welcome the failure of specific efforts within a broader program. They do not accept failure to learn from those efforts that didn't work out. So that type of failure is unacceptable, where you don't learn, where you make the same mistake again and again. That's not acceptable. But again, natural failure because you're trying new things, you're trying difficult things, that is the key route that I would say that make some cultures innovative, some culture's not, and it's no surprise, I think, utilities have a bit of a ways to go there as it relates to innovation.

Jason Price:

Well, I love your passion. I'm wondering, if you've noticed any of this being exported to your customers, organizations, or communities that you work with. In other words, can this be exported or does the influence of culture on how a company operates and innovate come from within, or can it come from outside?

Josh Gould:

I actually think most of the magic in my experience at utilities works the other way, meaning importing culture. That's not what I would call like an AstroTurf type culture, so you try to fake build on something that doesn't really exist. I think the way it can work really effectively, and one really important job of innovation groups or growth groups or any kind of group like that at a utility is to build the right external relationships to help a utility grow and innovate. So choosing those partners well can have a really great impact on innovation culture at a utility. The key is A, you have to choose those partners well. B is you have to expose those partners to as much of the organization as possible and feasible.

Josh Gould:

And what I've seen is really effective collaborations with those external partners and really effective collaboration with the innovation or business development group typically that brings these folks in can have a really great impact on innovation culture. We see it right here in Pittsburgh. Pittsburgh, for those who aren't aware, this is where Duquesne Light is based, I'm biased, but it's a great city. It's an underappreciated, in my opinion, area of tremendous innovation. So we have a lot of startups here, we have a lot of self-driving stuff here, we've got a lot of robotics here, a lot of stuff spinning out of Carnegie Mellon. And we've seen some really great success, and I think we're only going to have more of leveraging that community, those external partners, and bringing them in in a constructive way, you need to do some screening of them, but bringing them in in a constructive way, and I think we started to see some really great and beneficial impacts on the utility culture by bringing in those external partners.

Jason Price:

Okay, well utilities aren't necessarily considered innovative, so I'm curious how this has all been internalized at Duquesne. Have you run into any internal pushback? Do you feel any of your colleagues or senior level management find this thinking a bit, I don't know, esoteric? Keep in mind, you're working with engineers, scientists, and financial wonks who must be more focused on the tangible and the immediate. Tell us.

Josh Gould:

I say there's two common failure modes I've seen of starting up innovation groups or building innovation capabilities at a utility. One is what I would call the only I do innovation, meaning it's that innovation team that's maybe sequestered off in some place that doesn't have the right links to the core utility, that doesn't integrate the many groups, typically, within a utility who are already innovating, and that group says, beating their chest, "I'm the one that's doing innovation." That's not going to work well. To use a biological analogy, whatever that team then generates from an innovation standpoint, ultimately has to be adopted by the rest of the business, and the rest of the business is going to develop antibodies to that innovation because they're saying, basically, "It doesn't come from here. We've already been innovating, and now you're saying you're the only ones innovating." So that model of the innovation team is really the only ones doing innovation, that's a common failure mode. I also see a common failure mode with the everyone innovates. Now we want to build a culture where everyone is empowered and enabled to innovate.

Josh Gould:

I mentioned that earlier as part of our core mission, but you do need to appoint some people, in my opinion, who are responsible for that. And if you don't, you're just really pretending that it's going to happen when it doesn't. And then to point to something more specific... So those are two failure models. To point to something more specific, again, I go back to this notion of you do really want to have your innovation team producing some tangible and immediate quick wins to show people what innovation looks like. That can, I think, break down a lot of skepticism where instead of an innovation team talking about, "Hey, this is what we're going to do, or this is how we're going to innovate." That's good. You need to set that vision. But I think you really start to win over the skeptics and when you show them what you've actually done.

Josh Gould:

And then one level deeper, and one level more specific is one of the key things that I think you want to avoid having an innovation team doing is making it look like they're not subject to the same rules as the rest of the organization. So one tactical thing is you need to work really closely with key enablers, your procurement group, your supply chain group, your legal group, from the very beginning. You need to involve those folks early and often to avoid headaches, both on their end and the innovation team's end.

Josh Gould:

And if you've got good relationships there in those enabling groups, I think the sky is the limit. If you go off the rails with those groups, I think you need to watch out. And just the last thing I'd say about this is all of this necessitates a key signal from the top down, meaning from the executive and officer level saying this is important and that you, organization, need to work flexibly with the innovation team or whomever is driving this forward as part of their primary responsibility. If you don't have that clear top-down signal from the executive level, from the officer level, it's going to be really tough to do it fully bottoms up.

Jason Price:

Josh, let's go back to the core question about innovation and culture. This past year has been an incredibly challenging year for everyone. How has COVID impacted all of this and what do you expect will change or stay the same once we get out of this pandemic?

Josh Gould:

It's an interesting question. I think it's a complicated question. One silver lining I've seen is that COVID has made us challenge our assumptions about a whole lot of things. The social unrest that we saw this past year has, I think, caused a lot of us, in a healthy and effective way, hopefully, to challenge our own assumptions about equity and inclusion as well. So if you go back in a pre-COVID world and you would have asked a utility in a pre-COVID world outside of your field workforce, all of everyone else is going to go fully remote, and what would the reaction of utility executives be if they were told that pre-COVID? You've got to have basically your whole workforce go remote. They'd say, "Oh my gosh, our business is going to melt down. Everything's going to go to heck in a hand basket," so to speak.

Josh Gould:

And in my conversations with fellow utilities, almost all of them have gone fully remote now for basically a year, and the vast majority of them are not seeing a negative impact from a productivity standpoint. So I hope we use that experience to continue questioning conventional wisdom on a lot of things, on stuff just outside of the work practices. For instance, why can't we build a fully decentralized, clean, interconnected grid that's both cheaper and more reliable today and puts utilities in a healthy place financially? I think lots of people question whether we need to trade off some of things, de-centralization and clean and interconnected and all that sort of thing. I'd like to use that same kind of thought process of challenging conventional wisdom to challenge something like that moving forward. So the thing I hope we take with us is COVID upended a lot of things that we sort of assumed a lot of conventional wisdom, and I hope we take what we learned from that experience and continue to use that to challenge conventional wisdom.

Jason Price:

I like that. Sensible thoughts. So Josh, now time for a lightning round. We'd like to shift to let our listeners get to know you a bit more on a personal level. Your response will just be one word or phrase. Are you ready?

Josh Gould:

Yes.

Jason Price:

Okay. First question. Favorite cut loose meal where calories don't count?

Josh Gould:

Pizza.

Jason Price:

Favorite city to visit?

Josh Gould:

Seattle.

Jason Price:

Under the superhero category, invisibility or ability to fly?

Josh Gould:

Ability to fly.

Jason Price:

Guilty pleasure movie?

Josh Gould:

Stepbrothers.

Josh Price:

Favorite season?

Josh Gould:

Fall.

Jason Price:

And last, what are you most optimistic about?

Josh Gould:

Totally biased here, but innovation in the utility industry over the next decade.

Jason Price:

Love it. As a reward for a flawless lightning round, we'll give you the last word. If you knew that the CEOs of the major utilities across the country were listening at this very moment, and many of them certainly will be, what would be the one piece of advice you'd give them?

Josh Gould:

If you haven't begun a focused effort on innovation yet, start today. The version of yourself as CEO, the version of your company or your utility a year from now would have wanted you to start today if you haven't done so. So don't fool yourself into thinking innovation is going to happen naturally at your utility without consistent and focused effort. If you haven't set up an effort yet, I promise you that, quite frankly, your people are probably not properly incented, trained, or prepared to innovate in the way that you would want them to. And this ability to innovate is critical to your future success as a utility. So please don't outsource it. Don't outsource it to consultants, don't outsource it to external venture capitalists. Take it in yourself and build an internal capability. So choose your own destiny by focusing on it, investing in it, and spending time on innovation. And just like anything that's difficult, don't expect overnight results. So while you won't see the change immediately, while you won't see the change right away, promise you, you will thank yourself later that you started on innovation today.

Jason Price:

Josh Gould of Duquesne Light Company. Thank you once again for the inspirational conversation and diving into a topic on which you clearly have a lot to say. We want to see innovation be a core part of utility DNA and move the industry away from its reputation of being slow to move. So maybe we'll have to check back in you in a year to see if you're still moving ahead in the right direction. Thank you again for joining us.

Josh Gould:

Thank you.

Jason Price:

You can always reach Josh through the Energy Central platform where he welcomes your questions and comments. Once again, I'm your host, Jason Price. Plug-in and stay fully charged in the discussion about hopping into the community energycentral.com. See you next time at the Energy Central Power Perspectives podcast.

 

 


About Energy Central Podcasts

As a reminder, the Energy Central Power Perspectives™ Podcast is always looking for the authors of the most insightful articles and the members with most impactful voices within the Energy Central community to invite them to discuss further so we can dive even deeper into these compelling topics. Posting twice per month (on the second and fourth Tuesdays), we'll seek to connect with professionals in the utility industry who are engaging in creative or innovative work that will be of interest to their colleagues and peers across the Energy Central community. Some podcasts may be a continuation of thought-provoking posts or discussions started in the community or with an industry leader that is interested in sharing their expertise and doing a deeper dive into hot topics or issues relevant to the industry.

The Energy Central Power Perspectives™ Podcast is hosted by Jason PriceCommunity Ambassador of Energy Central. Jason is a Business Development Executive at West Monroe, working in the East Coast Energy and Utilities Group. Jason is joined in the podcast booth by the producer of the podcast, Matt Chester, who is also the Community Manager of Energy Central and energy analyst/independent consultant in energy policy, markets, and technology.  

If you want to be a guest on a future episode of the Energy Central Power Perspectives™ Podcast, let us know! We’ll be pulling guests from our community members who submit engaging content that gets our community talking, and perhaps that next guest will be you! Likewise, if you see an article submitted by a fellow Energy Central community member that you’d like to see broken down in more detail in a conversation, feel free to send us a note to nominate them.  For more information, contact us at community@energycentral.com. Podcast interviews are free for Expert Members and professionals who work for a utility.  We have package offers available for solution providers and vendors. 

Happy listening, and stay tuned for episode #19 in a few weeks! Like what you hear, have a suggestion for future episodes, or a question for our guest? Leave a note in the comments below.

All new episodes of the Energy Central Power Perspectives™ Podcast will be posted to the relevant Energy Central community group, but you can also subscribe to the podcast at all the major podcast outlets, including:


Thanks once again to the sponsors of this episode of the Energy Central Power Perspectives Podcast: West MonroeEsriAnterix, and ScottMadden

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