Mike Perk on making your retail operation future-fit

July 12th, 2019
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Amazon founder Jeff Bezos said it best: “In today’s era of volatility, there is no other way but to re-invent. The only sustainable advantage you can have over others is agility, that’s it. Because nothing else is sustainable, everything else you create, somebody else will replicate.” But what do you do if your retail operation still needs to go through a digital transformation? Future-fit evangelist, Mike Perk, reveals the 10 things digitally mature leaders do to give them the competitive edge.

What’s the first step a retail business should take to successfully execute a digital transformation strategy?

Education. By this I mean to adopt an ‘always-learning’ attitude. I have made this the first step for a reason. If retail leaders don’t have a clear understanding of what is happening in their sector, their thinking, strategies and decisions will be limited. The more you educate yourself, the more you know. The more you know, the better you can reduce risk, scale and solve problems. You don’t have to reinvent the wheel. Many have passed before you and shared their insights. Much of this is available online, so tap into that well of wisdom. Let others’ mistakes guide you in making better decisions.

Once you know how you want to move your company forward, you have to create a picture of the potential for everyone in the organisation. If you start to roll out your digital transformation programme without giving your team — the people who will live and breathe it — the opportunity to buy in from the start, you’re going to hit significant resistance and conflict. You’re going to be fighting with your teams more than you are the actual technology.

What is a picture of potential? It is that which resonates with people on an emotive level to inspire and provide optimism. Importantly, it is the purpose that enables your team to align their self-interest with the interests of the business. This is different to an archetypal vision or mission statement that would dictate: ‘In the next four years we want 50% of our income to come from the online space.’ The latter is a plan with specific outcomes. It is about making money, but this alone won’t get your teams aligned. A picture of potential tells the story of the higher purpose that your organisation is trying to achieve.

When technology is forever changing, what do you focus on? How do you set your north star?

This is controversial — but forget about the technology. Instead, retail leaders should embrace values-based decision making when it comes to digital transformation.

Amazon founder Jeff Bezos was always being asked, “What is the next thing I should be focusing on for my company?” And he would say that’s the wrong question. The question that should instead be asked is what’s not going to change in the next 10 years? For Amazon, the answer was three things: competitive pricing, fast delivery, and high stock levels. After understanding this, they invested in the technology that could fulfil these three requirements.

Understand what your values are. Understand what is not going to change in the next 10 years, and then look to apply the technology.

What do leaders need to do to lead a digital transformation in the retail sector?

There are 10 important things that leaders should do, and I’ve already mentioned two of them — ensuring you have a picture of potential, and that leaders embrace values-based decision making. The other eight?

Lead with optimism. If you’re a retailer and you keep telling your team that your business won’t exist in five years’ time, you won’t get your team behind you. You may well scare the living hell out them and they could start looking for other job, not to say anything about the adverse effect this approach could have on the mood, productivity and culture. The process must be led with optimism.
Communication is a critical part of any change mechanism. Communicate continually; be honest and transparent. Be willing to listen, and remember communication should be a conversation — a two-way process.
Become a heavy chef.
Don’t just talk about being future-fit; live it and breathe it. Your team needs to see you living in the new digital world, buying online, using process improving apps and tools. Invest in training so that your team can see how you are becoming a heavy chef.
Reconsider the structures and processes that underpin your business. If you are digitising your retail organisation, your business will require a different type of thinking. This means you will have to change the structure of your business and teams so that it becomes more innovative, or enables innovation. Hierarchical organisational structures, for instance, don’t naturally support innovative thinking so, to change this pattern, you’ll need to shift the structures.
Embrace failure, but don’t celebrate it. Physiologically, failure feels terrible, so don’t celebrate it but realise that embracing more risk is part of the innovation process. In the old days, we used to call this research and development, and there was a budget assigned to this. The significant change is that digital transformation/innovation can come from anywhere in the organisation and you need to enable people to make small mistakes to get meaningful breakthroughs.
Create a learning culture based on the understanding that this learning can come from anyone within the organisation. Process improvements or digital innovations should be pervasive, and not be the sole responsibility of the leadership of the organisation.
Engender trusting teams. You’ve got to build teams that trust each other. When companies innovate, embrace change and create learning cultures, you have got to be able to trust the person next to you to create a high-performing team. When I say trusting teams, I mean that there’s got to be enough trust to put your distrust on the table. Even if that’s the only point you need to get to. If you can build trust in your leadership team to a point where there’s enough trust to put your distrust on the table, then you’ll move forward. You need people to be open and mature enough to be able to voice and listen to problems without getting overly defensive if you are to move forward quickly.
Ensure that you and your leadership team are better data analysts. Not because you need more data analysts but because your leadership are your sense-makers. The future of the boardroom is the ability to understand data, and the options it presents, so you can make better decisions.
Why have I chosen these 10 aspects? Because research and experience show that these 10 things are what digitally mature managers are doing to successfully effect digital transformation.

First published on Marklives.com

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