Principal Financial’s Kathy Kay on customer-centric IT leadership

Kathy Kay is a senior IT executive who enables business success by driving simplicity in a complex world.

As executive vice president and CIO, Kay oversees the global technology and digital strategies for Principal Financial Group, where she is helping build the financial investment management and insurance company’s future. On a recent episode of the Tech Whisperers podcast, we explored Kay’s various roles as a builder, from building businesses, teams, and innovative ecosystems to building clarity, trust, and community.

Afterwards, we spent more time discussing how a mission-driven commitment to listening, learning, and pivoting to meet customer needs has been key to Principal’s longevity and its ability to remain future-ready. A true example of “drinking your own champagne,” Kay embodies and role models that commitment with her teams, inspiring a customer-centric approach to innovation and transformation. What follows is our conversation, edited for length and clarity.

Dan Roberts: You’ve said when you first heard about the CIO opportunity at Principal Financial, a 145-year-old company based in Des Moines, Iowa, you weren’t sure about whether it would be the right fit for you. What turned your skepticism into excitement?

Kathy Kay: The quality of the leadership. As I was interviewing, learning about the history and the company’s true commitment to its customers and people was exciting. A lot of companies say these things but seeing every person really living out that purpose is incredible.

The other thing was the willingness of a company that has been in business well over a century, and is known as a leader in the industry, to be humble enough to recognize that what made the company successful for the past 145 years is not what will successfully serve customers for the next 145 years. It’s this ability to look ourselves in the mirror and say, ‘The world is constantly changing, our customers’ needs are constantly changing, and as such we need to make some pivots to serve our customers more effectively.’ This was a recognition that we have to work differently, and I think companies sometimes shy away from a willingness to do that.

There was also the support and commitment Dan [Houston, past Principal CEO] had in making sure his leadership team was aligned. Dan and the leadership team recognized technology is at the core of enabling the future success of the business. That support and alignment was very appealing as I considered the opportunity, and it has rung true as I’ve had the opportunity to serve in this role.

You’ve worked in several companies and across several industries. Why is this company so well-positioned for the future?

Principal is a company that lives its mission. We are committed to helping more people and businesses make financial progress. It is a really important mission, and it inspires me to work on behalf of our customers each day.

We have also made the strategic commitment and hold the resolve to focus our efforts where we believe Principal is best suited to serve customers. For example, we have a strategic focus on serving the small-to-midsize business market, because that’s what fuels this country. We work with large businesses as well, but really getting to know how to serve SMBs and their employees effectively is incredibly gratifying. And, like I said, knowing when we need to pivot to better help our customers to prepare for their futures is exciting.

You hear all these stories about the history of Principal and how putting the customer first has driven strategic decision-making, and it is not surprising why we’re still here, why customers love us, and why so many customers stay with us for a long time.

There are a number of exciting things going on at Principal from a technology perspective. Can you talk about the role of technology in making the magic happen?

Technology plays an essential role in everything we do at Principal. It’s not just about enabling efficiency; it’s about unlocking opportunities to serve our customers better. We’re leveraging AI, data analytics, and cloud capabilities to enhance decision-making and create personalized customer experiences.

Customers have different expectations of us now than they did in the past, and we lean into the challenge to not only meet expectations but exceed them. Principal offers a number of different products and services, and customers may hold multiple products with us that internally fall into different business lines. But from a customer experience perspective, technology can help us break down business lines and drive to an integrated approach that allows our employees to serve our customers better and more effectively to provide a better experience.

To do this we are curating our data in ways that are useful across the enterprise, improving our analytics to better provide support to customers, and using AI to improve experience. These technologies give our employees the power to better serve customers. For example, it enables our agents to use data to proactively make suggestions to customers, such as a step they might need to take given where they are in their financial journey. I can’t think of a part of our strategy that doesn’t require engaging with technology.

You’ve mentioned how much you’ve learned from Dan Houston, who recently transitioned out of the CEO role after almost a decade. He was curious to know, what are some of the most important leadership lessons you’ve learned, both positively and negatively, over the course of your career?

An important lesson I’ve learned is one Dan lives every day — being a good servant leader. It requires you to listen, to really make yourself available, and to be close to customers and employees. You need to be willing to course correct when you get feedback, and you need to be able to provide the support and remove blockers when you seepeople struggling.

Over my career, the most important leadership lesson I’ve learned is the power of humility and curiosity. Great leaders don’t have all the answers; they ask great questions and empower their teams to solve challenges collaboratively. I’ve also learned that resilience is critical. Setbacks are inevitable, but they can become stepping stones when approached with the right mindset.

In terms of things I’ve learned to avoid doing as a leader, I need to avoid getting complacent, thinking I know all the answers, and not taking feedback. My teams know so much more, collectively, than I do. They are brilliant. If I am not listening and getting feedback from them, we’re never going to have the best solution. Staying open to learning — especially from those around you — is essential for long-term success.

Early in his tenure as Microsoft CEO, Satya Nadella said, ‘We are going to shift from being a know-it-all to a learn- it-all company.’ As a Fortune 500 CIO, what lessons do you take from this often-quoted bit of wisdom?

Before they made that pivot, I remember feeling like Microsoft had lost their way, because they were trying to push things on their customers. There was also a point in IT when we all were kind of doing that. It is easy for all of us in the field to get enamored with a technology and lose sight of the problem we need to solve.  

Commitment to creating a culture of learning is one of the things I love about Principal. We’ve been here for a long time, and that’s because we are committed to our customers, and we know as the needs of our customers change, we must learn and change with them. That requires me to make sure my teams have the time and support they need to constantly learn new technology so that we can create solutions that better enable us to serve the customers and move our strategy along.

So that quote certainly resonates with me, and it’s something I know we strive to do here — to be a listening organization and a learning organization.

One of your mantras is ‘don’t judge a book by its cover,’ which also speaks to the need to listen, learn, and stay curious as you evaluate ideas and opportunities. What are you reading right now to spark fresh perspective as you gear up to lead your organization in the year ahead?

The book I’m reading right now is Madam Clicquot. She and her husband had started the Veuve Clicquot winery and, after he died at 27, she kept it running during the 1700s and really shaped the champagne industry. I love Veuve Clicquot champagne, but I didn’t realize its rich history. In the 1700s, there were some issues that caused the wine to start bubbling and become sparkling wine. But there wasn’t really a market for sparkling wine. Ironically, Dom Perignon was trying to figure out how to make the wine not sparkle.

It’s fascinating learning about the history of champagne-making but also reading about Madam Clicquot’s tenacity and her impact in a very male-dominated world at a time when women weren’t in these positions of leadership. It’s a great read. And it’s really good champagne.

Like the pioneering Madam Clicquot she admires, Kay has built a legacy of embracing challenges, leading with purpose, and pivoting to serve and anticipate customer needs. For more insights and advice from one of IT’s most impactful leaders, tune in to the Tech Whisperers podcast.

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