My day job is working with companies who are needing to 'change & grow'.
Sometimes this includes a review of the operating model in order to uncover and leverage growth.
This focus comes with lots of reasons, and unfortunately most of them are unfortunate basket cases, mainly because the best time to change is similar to the best time to do repairs on your house e.g. when the sun's shining.
Before, and in particular since Covid I talk to lots of companies who say they are keen to change but decline to discover the internal 'change makers' or recruit external ones because of the lame excuse called 'culture fit'.
I'm not naive, I've been around the retail sector for many years, I've operated across all areas of retail in a number of different countries.
I understand that they all carry a huge fixed and legacy systems cost base, but your customers (or lack of) don't really care about that.
As a company you have to have a strong sense of who you are appealing to if you are to build a sense of personality (brand) that starts customers on the road to buying from you.
Confused companies, confuse customers, who buy from someone else. Unless of course your products are so cheap and competitors so weak it does not matter.
For many the biggest of those cost are indeed the physical retail store network, so I get that you can't simply cull stores overnight (unless your Covid) but to build the future sometimes have to leverage the past, or reinvent what you are, or as someone once quoted me "It's easier to give birth than it is to raise the dead".
Now is the time to adopt a 'leverage and build' strategy, not when you're failing and playing catch up.........
One key reason for Kodak’s demise was its insistence on using the digital photography disruption to improve its core film and printing business.
In the mid-1990s, Kodak introduced the Advantix Preview film and digital camera system and spent almost US$500 million promoting it.
So as not to cannibalise the film business, the Advantix required users to use film and print their photos.
A decade later, Kodak filed for bankruptcy. So why was improving its existing business the wrong thing to do?
A company needs to assess whether the core business is worth saving or improving before deciding whether it should use new technologies to improve it.
Kodak should have asked: “Given the new realities, is the printing of photos a viable business for us to fight for?” If the core business is marching toward oblivion, there is no sense in trying to improve it.
The traditional retail sector has lumbered along for many years, when the internet arrived far too many of them just like 'Kodak' saw it as a threat to 'cannibalising' the physical store network and did very little, a few of them followed the herd and added a website, but all done at a very slow pace.
In my experience you can introduce new processes, new technology, and yes even new people, but if the mindset of the company (it's culture) doesn't change then it's all wasted time and effort.
Traditional retailers that failed to recognise the potential impact of eCommerce have been seeing casualties for well over a decade, and this certainly isn't something new that was brought about by the Covid crisis
If you're the biggest and best in your sector today you won't be for long, the internet has allowed millions of people around the world to take what today might be a small bite out of your very large cake, and if enough of them do this consistently and better than you then it's inevitable they will quickly dilute what you think is a dominant position, the reality is the digital Pandora box is open, and it isn't closing anytime soon.
This all carries huge implications for leaders who need to develop a strategy in response to disruption: They must step outside the mind-set of focusing on the core business and think from a different perspective.
For example, an entrepreneur would ask: “If I were considering entry into this new market created by disruption, what strategy would I adopt?”
The next huge wave of disruption for all businesses is already here, and in particular in the context of this post for online/offline retailers is already happening, it's called 'social media' and if you still think it's just a place to 'advertise and promote' your brand then you're in for a very rude awakening.
Just as all those unknown online retailers nibbled away at traditional retail, 'social commerce' will do the same thing for your eCommerce website, and this will of course also help to dilute your physical store traffic even more.
So, who in your business is being tasked to ask and answer that BIG question?
Most CEOs think improving products or creating a burning platform will ensure success in the face of disruption. But these actions are not enough.