Multichannel Success Podcast Season 3 Episode 6 - Transcript

Efficiency is your new superpower & it’s not just about growth

Listen to this podcast here:

Mark Pinkerton [00:00:09 - 00:00:27]

Today we're going to talk about efficiency and how it's your new superpower, particularly if you're a retailer. And we have a number of excellent folk around the table with me and one remotely the other side of the Atlantic. So starting from my right we have...

James Brooke [00:00:28 - 00:00:43]

I am the CEO of SWEFT and formerly the founder and CEO of a company called Ampliance. So I'm software side, I've been working in retail for the last 20 odd years, particularly on the digital side of things and it's great to be here. Thank you James.

Mark Pinkerton [00:00:42 - 00:00:44]

Thank you James. And on my left we have... We have David Kohn, a regular contributor.

Mark Pinkerton [00:00:47 - 00:00:51]

And the other side of the Atlantic, on screen we have...

Michael Robinson [00:00:51 - 00:01:07]

Chief Product Officer at SWEFT, and I've been in retail, I've been a retailer for 30 plus years working with a variety of retailers from Macy's through Anthropologie and everywhere in between.

Mark Pinkerton [00:01:06 - 00:01:30]

Thank you. I want to start the conversation really by asking people, why do we think that efficiency is now the focus for organisations? Clearly we've had explosive growth in digital in periods where we've all enjoyed and thrown resources at it, but now things are focusing more on efficiency. Why do you think that is? James.

James Brooke [00:01:30 - 00:01:39]

So I think we're in this interesting post-pandemic period, aren't we, where there was a huge amount of investment based on that demand signal, which said, you know, everyone's going online.

Mark Pinkerton [00:01:30 - 00:01:31]

So I think we're in this.

James Brooke [00:01:39 - 00:02:15]

So I think that in the end turned out to be a little bit of a false dawn. And as a result, there were some bad investment decisions that in retrospect, I think people would probably unwind. And it pulled forward a lot of spend and a lot of investment in people and capabilities. So what we've seen in the last few years is a lot of growth, but not very much profitable growth. And when you look at retailers today, particularly in the UK, there aren't very many that are growing and simultaneously profitable. So I think we're at an interesting inflection point where retailers really have to think about profitability and sustainable profitability. And so efficiency really is a way for them to achieve that.

Mark Pinkerton [00:02:16 - 00:02:30]

Yeah, we're certainly seeing, you know, a number of retailers pulling in administrators right now and we've had the body shop as a big example having just been taken over and this week super dry. Clearly things are tough in the retail world. Are there other reasons?

David Kohn [00:02:29 - 00:03:13]

A perspective from my side, when I started in e-commerce it was a separate function and it has remained in many organisations a separate function throughout my career in e-commerce. What we're seeing now is as e-commerce becomes part of the day-to-day operation, part of the core business, is you're seeing e-commerce functions merge back into corporate functions and what that requires, it requires an organisation to really think about how it operates and how it can create a blended organisation that does all of the things it needs to do, be that stores, be it e-commerce, be it other channels, how it does those things in the most efficient and cost-effective way possible.

Mark Pinkerton [00:03:14 - 00:03:23]

Yeah, Michael, you have a good phrase about the trifecta of change that needs to happen.

Michael Robinson [00:03:22 - 00:04:15]

The main point I wanted to make about the need for efficiency now is the retailers have lost the price transparency with the internet, with online being such an important part of the shopping process now. They've lost the price obscurity where no one knew what things cost. So now suddenly there's this pressure on their margins that they didn't have before. Then the free shipping has become, even though it does vary how much is being offered, it still has an impact on retailers in terms of the margin, the cost that it hits them with. And then finally, if you look at just the marketing costs, online marketing costs, what they were a decade ago, what they are now, just out the roof, obviously. So there's all these pressures on the cost of doing business that before they could raise their margins accordingly. Now they can't. Yeah.

Mark Pinkerton [00:04:15 - 00:04:20]

Yeah, yeah. And I think there are even other issues in terms of the, you know, certainly Yeah.

Mark Pinkerton [00:04:20 - 00:04:34]

from a UK perspective, the whole economy is just bumping along just above being in a recession. Depending on the month you're talking about, we're either just in or just out of recession, so pretty flat.

David Kohn [00:04:35 - 00:05:05]

Yeah, look, I don't think anybody here is saying you can no longer grow, you're not allowed to grow anymore. But the facts are that that growth that we got by just turning up to work 10 years ago, it's not it's not there anymore. And even if you're growing, you've got to think at some point about how you grow profitably. So to my mind, whether you're in period of slight decline, whether you're flat, or even whether you're on growth, or even super growth, you have to

Mark Pinkerton [00:04:46 - 00:04:47]

That's a go, yeah.

David Kohn [00:05:05 - 00:05:12]

be thinking about profitability. And if you're thinking about profitability, you have to be thinking about efficiency.

Mark Pinkerton [00:05:12 - 00:06:19]

Yeah, no, I totally agree. I mean, the natural growth we've seen from the IMRG data, you know, Ecom in the UK has been minus 8% for the last couple of years, and I think they're forecasting an optimistic growth rate of about 1.3% this year, which is below where we think it will be, but it's pretty much flat after two years of decline. So absolutely everybody has to focus on efficiency. But we've also got the short-term issues of, you know, the war in Ukraine, the pandemic recovery, supply chain issues because of Suez and Panama Canal running out of water, all of those sorts of things are clearly not helping. And we believe fundamentally in the interconnectedness of all things. So, you know, we know that a supply chain issue will ultimately affect people's ability to get product online quickly and effectively. So in terms of efficiency, what do you think, you know, we're talking about efficiency being the new superpower. What's your view, James, in terms of what efficiency do we mean by that? So in my world, which is often folks looking to deploy technology to improve their efficiency,

Mark Pinkerton [00:07:07 - 00:07:09]

it's all about doing more with less and being able to scale without really scaling the costs associated with doing business. So for many of our customers back in the day at Ampliant where they were, for example, putting in dynamic media, it was all about taking out the drudgery of creating all the image variants. That was a big problem. There were racks of servers and racks of people cutting individual images which was completely – when you look at it now, bonkers, but at the time that was the only way to do things. So technology's got a role to play, that's for sure. I think the other side of it, though, of course, is more efficient processes and really getting your business model set up to scale in a way that maximises the return on everything that you do. Michael.

Michael Robinson [00:07:07 - 00:07:50]

All right. All right. Well, that's just where the trifecta came in. Really, I see it in three pieces. One is being able to do the same amount of output or results with less people or less resources, being able to have more better results with the same amount of people, or nirvana, which is being able to do more or grow with fewer people. And that third one is where it really requires investment in the technologies and process improvements to make that kind of thing possible. But that's really what helps a business become a profitable and growing company.

Mark Pinkerton [00:07:50 - 00:07:55]

Yeah, and certainly where you've got retailers competing with Amazon who have a couple of

Michael Robinson [00:07:50 - 00:07:51]

Yeah, yeah. And certainly, where

Mark Pinkerton [00:07:55 - 00:08:13]

million product per merchandiser effectively, clearly technology is driving that and I don't think many retailers would even aspire to get to that level of volume per head because of the quality is not where most retailers would be happy to be.

David Kohn [00:08:12 - 00:09:25]

I think the perspective I would have from the position of a retailer is I've never met an e-commerce retailer, I've never met a retailer who said they've got more resource than they need. Every single one you talk to, they'll tell you I don't have enough people, I don't have enough money, I don't have enough budget, etc, etc. And the fact is that in today's economy, you're less and less likely to get those extra people on the payroll that you might have been able to get four or five years ago. So for me, two absolutely critical things for everybody to be looking at. One is, are you doing the right things? And the second one, and you may see this coming, is are you doing things right? Are you doing things as well as you can? And I can absolutely guarantee that every single person listening to this, every single person I've ever met in the field of e-commerce has loads of people working alongside them or for them who are spending their time either doing things badly or doing things that are not really important to their business.

Mark Pinkerton [00:09:25 - 00:10:22]

Yeah, that makes sense. I think, but for our listeners, just to summarise the whole piece of efficiency, all of these effects ultimately drive the bottom line of the organisation. So it is about maintaining margin or increasing margin so that you are a profitable organisation, whether or not you're growing or static, and also being able to get product to market quicker with fewer interactions within the organisation, so that things are as effective as possible. In terms of efficiency, what are the best ways that we've come across in terms of trying to measure efficiency? Because, you know, we could go down lots of potential different rabbit holes in terms of efficiency, but what's the best measures of efficiency that you've experienced? Perhaps Michael, you'd be the person to start with on that one.

Michael Robinson [00:10:29 - 00:11:37]

Look at what's important to the organization. What are the big challenges that they have? And then what is the impact of those things? Because then from there, if you see that, if it's the biggest challenges around shipping costs or something like that, or if the biggest problems are around getting the product to market fast enough, or if it's about your pricing or something like that, really identify where the big problems are and then do a deep dive to understand what are the things that are causing that problem. So you may have a pricing issue, but is it just that you don't know the right prices or is it, is the process by which prices are derived or are selected, is that really flawed? And is there, are the wrong people doing it? Are the, do they not have the resources to be able to identify the right, we need a price, not just, you know, adding 60% on or 80% on or whatever the margins are for the company, but really like really do the analysis. But it's really being able to identify what are the big challenges? What is the impact of that? And then looking down behind that and understanding in the back part, the back office of the business, how is that, you know, how is that problem being caused by all the other things going on in the business? Yeah, the challenges there.

Mark Pinkerton [00:11:37 - 00:11:47]

James, you mentioned one earlier, which I wanted to bring up, which was about the cost per employee. Well, yeah, I think there are some very raw measures.

James Brooke [00:11:44 - 00:12:42]

Well, yeah, I think there are some very raw measures of efficiency, things like revenue per employee, but of course, you know, they're fairly basic and I think they sort of hide a whole range of sort of, you know, underlying potential issues, but there's a fundamental measure, you know, $300,000 or $400,000 for employees is very efficient and obviously if you're below $100,000 per employee, you're probably a business that really needs to think hard about, you know, how it can do things in a much more efficient way, but that hides a whole variety of different business models and it depends very much on your input costs and everything else. So I think really what it comes down to ultimately is looking at those big measures that really impact profitability and trying to understand what you can do to move the needle, whether it's, you know, the in-stock, not online problem that, you know, we talk about at SWEF, whether it's returns, whether it's, you know, buying better and making sure that you're avoiding wastages, you're not down on all those things, but there are some really big things I think that you can get at, David.

David Kohn [00:12:43 - 00:14:04]

Yeah, look, for me, I think we talk on the subject of efficiency. It's incredibly inefficient to look at every conceivable problem. Yeah, you may have 100 different problems. But if you were to try and address all 100 of them, that would probably be about the most inefficient activity you could undertake. So for me, there's a basic three step process, one of which is define the problem. You generally know, yeah, you can either see in some big numbers or you can see in terms of the way your organisation operates that there's a problem. The second thing is to validate the problem and do your best to measure it. Let's say you have a problem that you think is a problem, nobody else thinks a problem. Well, if you're adamant that it's a problem, then you've got to find a way of measuring. You've got to find a way of validating that that's a problem worth solving. And then the third thing is, and this is going to be true for pretty well everything we look at, is you've got to create a business case for it. Yeah, you're not going to get an investment for a tool like SWEFT. You're not going to get an activity like a restructure or a change in personnel unless you can provide a business case. So, yeah, three step process will get you to the point where you know what the biggest problems are, you know how big they are, and then you've got an idea of what happens if you solve them.

Mark Pinkerton [00:14:04 - 00:14:21]

Yeah, of course there may be the sort of cause majeure piece where you've just got to cut 35% of all the heads in the business and that's not really the environment we're talking about but that sometimes happens without a budget justification for a reorganisation.

David Kohn [00:14:21 - 00:14:24]

And one or two of us have been there on more than one occasion.

Mark Pinkerton [00:14:24 - 00:15:10]

Indeed, indeed. I think we've all been around that one. Okay, so I think from a consultant point of view, which is what I bring from a Prospero side of things, I think things like the speed to market are important metric. We're predominantly focusing on e-commerce within multi-channel here because it's the more technology driven side of things and trying to be more efficient within e-commerce is perhaps the bigger challenge right now because it has been growing for so long and people are just throwing money at the problem and then we're kind of looking around and going, oh god, it's costing us far too much money, we're not making any money out of e-com. So, what do we do when the whole market...

Michael Robinson [00:15:10 - 00:15:38]

I'll add to that that also e-com for most bricks and mortar business or traditional retailers, it's an add-on. So it's sort of attached to the side of their business. They kind of band-aided it into some of the processes that they already have, and then sort of now just make it work, even though it doesn't necessarily have all the tools it needs or the processes, and those processes are often very siloed and not necessarily integrated with the rest of the business in the way it works, which creates a huge amount of inefficiency.

David Kohn [00:15:37 - 00:15:46]

Yes, yes. And I think as well that inefficiency isn't just monetary, it's cultural. Yes.

David Kohn [00:15:46 - 00:15:47]

Oh, yeah.

Mark Pinkerton [00:15:46 - 00:15:48]

Oh, yeah.

David Kohn [00:15:47 - 00:15:55]

You know, inefficiency in one department can really affect teamwork across all departments.

Michael Robinson [00:15:47 - 00:15:48]

You know, I know you guys like to talk about the interconnectedness of things. And of course, and I know with SWEFT, it's one of its big merits is that it's able to identify if there's a blockage in one department. And culturally, that blockage in one department is probably creating more negative conversations and more negative culture than almost anything else that's going on. But the other thing I think is a facet of this, which is important, is that it stops people focusing on the value-added activities. In every organisation, there are some things which are super important for your business, be they content, be that photography, be it stock management, be it sourcing. And people find it incredibly easy to be distracted from that. And if they've got what I would call commodity activities, which are inefficient and absorbing too much of their time, people will very readily immerse themselves in those commodity activities because it avoids them doing the really important stuff.

Mark Pinkerton [00:16:52 - 00:17:24]

But certainly organisations I've worked with have often needed somebody to come in from outside to review what's going on in the process, to understand where those inefficiencies are and where the commoditisation are. Because quite often if you're dealing with one particular department, they might know where one or two things are going wrong on their side, but actually we're talking about the organisation as a machine effectively, and being able to take that holistic overview, which very often has to come from outside or from the top.

David Kohn [00:17:24 - 00:18:08]

I think you're spot on. I've always hated the term silo organisation, because it implies a lack of willing. And that's what I don't like, because I think most organisations I've worked in, people are generally cooperative, and they understand they're part of a cooperative enterprise. However, your job is your job, and quite rightly, you're focused on your job. And I think you're right. It often takes somebody to come in from outside and say, you know that job you're doing? It's not really that important to the great scheme of things. It's not really that important to our aims. Or conversely, your job's really important. We need more of you. We need more of this activity.

James Brooke [00:18:08 - 00:18:19]

No, absolutely. I think the underlying all of that is that fundamentally getting to be more efficient is a process of change. There's a transformation element to that. So you have

David Kohn [00:18:19 - 00:18:20]

So you have to have a very.

James Brooke [00:18:19 - 00:19:11]

to have a very clear-eyed view on what it is that you're transforming to and for why and what the benefit is, to your point, David, earlier about having a business case that really makes sense. But I think it also helps, particularly when you go into the back office, and I think this has been said already, that retail back offices haven't really got the attention that it should have done. To Michael's point, e-commerce was often an add-on, so a digital retailer really has been a bit of a strange, multi-headed beast in that regard. And as a result, you've got lots of these slightly strange processes that have been bent out of shape to make them work for digital or to do something in the back office that enables both. And the net-net of that is that you have an organisation with lots of slightly misplaced resource allocation and some broken processes. But to change, you have to have a really clear view on what you're trying to change towards.

Mark Pinkerton [00:19:12 - 00:19:17]

Maybe we should take a break here, for a message from our sponsor, SWEFT, Retail's leading

James Brooke [00:19:12 - 00:19:13]

Maybe we should.solution for product workflow automation. SWEFT is designed to replace the in- house tools and spreadsheets retailers use to manage product workflow, by bringing buying, planning, marketing, studio and e-commerce teams together on a single powerful platform. To launch products faster and more efficiently, find out more at

And so now we're back. One thing I wanted to cover off, because we've talked around it but not been specific enough perhaps, and we try and pride ourselves on being practical and pragmatic on these things, is some of the KPIs around efficiencies that retailers will have, classically will be things like speed to market, your speed of getting a product online from when it arrives in the warehouse or from when it goes live on whichever system is your master system of record, your ability to carry out product launches or the number of campaigns that you actually run per season, per year, or whatever the metric is that you happen to use. Are there any other sort of obvious top line KPIs around efficiency that you tend to run

James Brooke [00:20:34 - 00:20:39]

Well I guess online wise, I mean the thing that we talk about all the time is in stock

Mark Pinkerton [00:20:34 - 00:20:36]

into, James? Well I guess top line-wise, I mean...

not online which is which is very much that product launch metric essentially looking at the measure of how much of your stock and how long it sits in warehouse before it's available online and the reason it's such a useful metric is that it actually works across the whole business because you know for many retailers if the manufacturer is getting products up you know more quickly and they're launching their collection and you don't have it in your website even though you have it in store, customers don't even know it's available so you end up in a situation where you're not selling through a full price, you're into markdowns very quickly, there's a margin erosion effect as well as all the cost inefficiencies associated with that. So full price sell- through clearly then is another key point to consider.

Mark Pinkerton [00:21:16 - 00:21:45]

So full price sell-through clearly then is another caveat that comes out of that. I think one thing that we used to try and enforce with as many retailers as we worked with back in the day was viewed availability, i.e. how much stock gets fragmented, particularly on the website, because you can track that. It's much harder in store to track it, but you can track it online if you set up your analytics in the right way you can do it, but not enough people do.

Michael Robinson [00:21:45 - 00:22:28]

So I'd also just mention there's a few other metrics. If you look at it, you know, the studios are typically trying to measure how much the throughput of photography and of samples and measuring the, you know, how copies written. Merchant teams are often, can be measuring vendor compliance and particularly with providing the information that needs samples and things like that. And also just, you know, are the orders going in on time? Are they providing through information to the other teams in a timely fashion? So there are lots of little metrics you can have. They're typically very siloed. The benefit of a measure like it's not online is it really covers the gamut. And you can look at it and say, okay, we have a big problem. What's the small problems that are causing it?

Mark Pinkerton [00:22:28 - 00:22:44]

Okay, the other challenge to this whole efficiency piece is around the fact that at the same time as we're focusing on efficiency, retailing has actually become a lot more complicated in the last decade.

James Brooke [00:22:43 - 00:22:56]

Well, absolutely. I mean, I think we're in a, we're in a, obviously mobile changed the game. You know, we'd all got our desktop strategies working very nicely and we'd been optimizing for those desktop experiences. Mobile came along and all of a sudden you've got a different sort

David Kohn [00:22:54 - 00:22:56]

all of a sudden.

James Brooke [00:22:56 - 00:23:22]

of set of screens that you need to consider. But also customers are in more channels than ever before. And I think this fragmentation of your consumer means that you're going to have to work a lot harder to get to them. And you've got to create more different types of content that are working in different contexts. And so it's become a really complex problem for sure. And I think it's only going to get more fragmented looking at the way that consumers are adopting new apps and adopting new technologies.

Mark Pinkerton [00:23:22 - 00:23:32]

And the corollary to that within a retailer would be the degree of personalisation and customisation that you want to offer of both the product and the offer to those customers

Michael Robinson [00:23:30 - 00:23:30]

and the author.

Mark Pinkerton [00:23:32 - 00:23:33]

in those situations.

David Kohn [00:23:33 - 00:23:38]

Yeah, I think for me, I mean, there's so many areas in which retail has become more complicated.Can't really go through them all. But I think the one thing that always struck me was that content has become more complicated because you're selling through more channels, because you're trying to be more personalised. You have to have more content. Now, whether it's the same content repurposed in multiple ways or whether it's genuinely different content, you've got to be creating a lot more stuff. You need a different type of advert to go on Facebook than you do on TikTok than you do on display advertising. All those things require a different form of creative. If you're selling through different channels, you may require different types of product description, different attributing. And that, for me, is where in an organisation, a retail organisation, there's a danger of your resource requirement mushrooming. And those, for me, are the areas where you've really got to try and find tools. You've got to make investments that are going to enable you to do that stuff without having to ship in 20 new people. You know, whether it's AI or whether it's image refactoring or whatever it is, you've got to be trying to find ways because there's a lot of content and a lot of content variety you have to produce nowadays. Yeah, totally agree.

Mark Pinkerton [00:24:58 - 00:25:29]

Yep, totally agree, totally agree with that. So with these challenges, what do we think the best way a retailer should respond to those challenges? I mean, from a consultancy point of view, we've already talked about measurement and targeting the areas for improvement, but then it's about trying to find the right solution to those particular challenges, and technology will be one of those, but what are the other ways that a retailer should respond to those challenges? Do you want to start that one, David?

David Kohn [00:25:28 - 00:25:39]

Well look, I'd say there's a massive temptation always to leap straight into technology, but technology never delivers the whole answer, and it rarely delivers the answer that you expect it to be. So first and foremost for me is, whatever that change is, you have to be committed to it, and you have to understand that it's going to have implications for your organisation, and it will have implications for that organisation that are outside your ambit of responsibility. And let's take SWEFT as an example, it's very much a cross-business tool, the tool in itself is incredibly useful, but unless the buying team, the merchandising team, the e-commerce team, the photography team, the marketing team, unless everybody is bought into that, it's not going to work. And so that would be my principal piece of advice here is, be committed and understand that just putting a new tool in, ain't going to provide you with the full answer.

James Brooke [00:26:29 - 00:27:18]

Yeah, I think that's very true. Ultimately, these big pieces of business change or transformation require that degree of commitment. You need buy-in from all the key folks that are stakeholders in that outcome. And you need to manage that process of change. I mean, we've just gone through, and Michael can fill in some of the details here, big implementation at Harry Rosen, which is a reasonably complex retailer. Everybody that you've just described, David, is involved in that process. And it's taken, I think, it's fair to say, a reasonable amount of time to get buy-in from those teams for them to really see the benefit. We had to work very hard with those individual teams to help them understand not just why this benefits the whole org, because of course, that's relatively straightforward, but why does it benefit them? So I think you've got to set it at an org level and at a departmental

Mark Pinkerton [00:27:14 - 00:27:16]

So I think you've got to say, at an all-time high, it's got to change.

James Brooke [00:27:18 - 00:27:21]

and individual level. Would that be fair, Michael?

Michael Robinson [00:27:21 - 00:27:47]

We had a benefit there of having very high-level buy-in and support throughout the process. Because if you don't do it that way, what you end up doing is getting in silos of technology or of process change that affect one department because they couldn't get everyone's buy-in. So it's really important to have a buy-in across the organization.

David Kohn [00:27:49 - 00:27:55]

I also think if it's important enough, you've got to do your prep as well.

at Heels, we had a problem with clearance stock, and I won't go into the full ins and outs of it, but the real barrier to us putting a better process in was all to do with product coding, is how products were coded in our ERP. And everybody who needed to be was brought into it except for one person in the organisation who didn't like the process of recoding products from live, if you like, to clearance. And that stopped something, well it certainly slowed it down, it didn't stop it, but it slowed down a project that could have been of immense benefit to the organisation and it was simple.

Mark Pinkerton [00:28:41 - 00:28:56]

Yeah, so typically what's your big measure of success if you've put SWEFT into an organisation? Are you being measured against a number of different metrics or is there just one key one that you kind of...

James Brooke [00:28:56 - 00:29:07]

It depends on, obviously, the retailer, the model, and the key problem that they're solving for. But if it's very much the in-stock or online piece, it's very much time to market.

David Kohn [00:29:03 - 00:29:05]

Thank you very much.

James Brooke [00:29:07 - 00:29:41]

It's how quickly can you get that product launched and how efficiently you can do that. And by which I mean, can you get the desired level of quality and get the speed simultaneously? And therefore, can you synchronize the range across all your channels? And ultimately, make sure that your full price selling season is as long as it possibly can be. So the measures of success aren't just that you've halved the time it takes to get a product live, but actually that your gross margin is significantly improved and that your overall cost of scaling that organization.

Mark Pinkerton [00:29:41 - 00:29:48]

And your entire product catalogue is consistently created to an agreed standard, which can't

James Brooke [00:29:41 - 00:29:42]

Yeah, and your entire product.

Mark Pinkerton [00:29:48 - 00:29:50]

be published until X, Y and Z have been done.

James Brooke [00:29:50 - 00:30:16]

And there are lots of benefits having better quality product information, right? Better attribution, better product information, feeds, better merchandising, you know, search and dicing strategies. You know, all of these things have a knock-on impact on the quality of that online experience and fundamentally, at the end of the day, you're trying to help consumers find the things that they want. You're trying to help them to inspire them to buy perhaps things that they didn't know that they want. But to do that efficiently on site, you've got to have the data there because it's the foundation of the experience.

Mark Pinkerton [00:30:17 - 00:30:18]

Yeah. Okay.

Michael Robinson [00:30:18 - 00:30:40]

We provide accountability so that there's clear timing of what happens, so both the metrics you need to understand productivity in the different departments, as well as the accountability so people can't stop, become a blockade for the process moving because it becomes very visible when they are.

David Kohn [00:30:39 - 00:30:42]

Are you measuring happiness?

James Brooke [00:30:43 - 00:31:31]

So that's a really interesting question, David, and I would like to think, and I'd like to come back to you perhaps on a later podcast around this, because I think our opinion is that it significantly improves the employee experience, because fundamentally you're not wrestling with multiple spreadsheets, you're not buried in this sort of cumbersome and broken process with millions of messages going out on Slack and email and this really complex and stressful process where everybody's sort of shouting at each other because, you know, this isn't live or we don't know when that's ready or what's happened with this product or have we got that photography. Everything is beautifully pulled together into a simple dashboard where you can see exactly what the status of the assortment is in that process all the time. I would hope and I would expect that that reduces the level of stress in the organisation significantly.

David Kohn [00:31:31 - 00:31:57]

And I would say that is true of many of the process improvements that might be of value to the organisations of people listening to us. It's often you're going to get an efficiency, you may be able to do more with the same or more with less, but actually what you are going to do in many cases is you're going to make people's jobs better and less frustrating.

Michael Robinson [00:31:54 - 00:32:10]

less frustrating.

James Brooke [00:31:54 - 00:32:02]

less frustrating. We'll be right back.

Mark Pinkerton [00:32:11 - 00:32:18]

Wow, is that because they were sorting out all the, they were at the bottom end of the process pile and having to sort out all the problems?

Michael Robinson [00:32:19 - 00:32:26]

It's because they're at the end of the process. They're the, everything that goes wrong. Yeah. Everyone turns to them and says, why is this not online?

Mark Pinkerton [00:32:26 - 00:32:30]

Yeah, yeah, and it's completely transparent in e-commerce, whereas it's not everywhere else.

Michael Robinson [00:32:26 - 00:32:27]

Yeah. And it's completely transparent.

David Kohn [00:32:30 - 00:32:44]

But I do think, again, I talked a bit about organisational culture before, is fixing things that are going wrong, even if they're trivial things.

Mark Pinkerton [00:32:39 - 00:32:42]

I was horribly unprofessional.

David Kohn [00:32:44 - 00:33:15]

If you can get rid of those things, you know, I've run customer service departments for many years. Obviously most of what they do is fixing problems. If you fix problems, the whole mood of an organisation improves, and the mood of your customers improves, and you really shouldn't underestimate how not letting problems occur in the first place is a brilliant tool for improving the efficiency of your organisation.

Mark Pinkerton [00:33:15 - 00:34:14]

But it's also, something goes back to your comment about happiness, in that people generally don't like being presented with problems and trying to have to fix them on a one-on-one basis. It's not a pleasant thing to do, to be faced with an angry customer and then trying to resolve an issue. So, by getting rid of that, you will increase people's happiness. Yeah, so I just, we're getting close to the end of time, so I want to start wrapping up. What do we think the future looks like in terms of efficiency? You know, how much of it is going to be AI driven? How much of it is just people being more aware and having a bigger quality focus? What, how do we see this moving forward?

James Brooke [00:34:15 - 00:35:21]

Well, from my perspective, I think a couple of things that we've picked up on here are really trends that will just continue. And I think this integration of digital into the business to form. I don't know whether you had a whole podcast talking about whether it's omnichannel or not omnichannel, any channel, whatever it is. Fundamentally, it's about building a retail experience that from a consumer's perspective is seamless and it's all on brand everywhere and every touch point. But from an operational perspective, also looks a bit like that on the inside as well. And I think that trend is only going to continue because the inefficiencies of running these sort of slightly bent out of shape processes to service the digital consumer versus the stores consumer, you know, that's where a lot of this inefficiency really comes from. So my prediction will be that over time and it will be incremental, you know, gradually these processes will be refined and tools and technologies will come in place to put everybody on the same page. And that actually the world will become a lot more integrated and hopefully a lot more pleasant place to work because you'll be not dealing with some of this legacy issue that really comes out of that, you know, original bifurcation between these two business models.

Mark Pinkerton [00:35:22 - 00:35:22]

and Michael.

James Brooke [00:35:22 - 00:35:25]

Subs by

Michael Robinson [00:35:23 - 00:36:03]

I think that where I hope to see it go is that there's a lot more visibility and transparency across the organization and less silos. I think a huge amount of the inefficiency comes from the siloification of the business. And I think as much as that is eliminated, and you know, what Dave talked about in terms of e-commerce being integrated in the organization, I hope that is part of the process of improving that efficiency. So it's not a separate organization, but really part of how the whole business works. So I think that's a direction that I'm hoping it goes in terms of having that end-to-end visibility in all parts of the business, not just the process of bringing things online.

David Kohn [00:36:03 - 00:36:11]

Yeah, and for me, I think the successful retail organisations, successful organisations full stop will be those that understand what their real point of difference is and where they need to apply brain power, intelligence, creativity. At the same time, everything that needs to get done. They will focus on getting it done as efficiently as they possibly can because that's where you want to spend as little time as possible. You want to spend your time on the things that are important to your brand, your proposition, your customer.

James Brooke [00:36:41 - 00:37:02]

And that's potentially, by the way, where you mentioned AI, we didn't pick up on it, but I think that's really where the opportunity with things like AI come from, because this idea that you can augment these work processes and you can really take a lot of the drudgery away from that day-to-day piece, so you can focus on what really matters, I think it's a huge opportunity. How that unfolds will be really interesting.

Mark Pinkerton [00:37:01 - 00:37:32]

I completely agree. I think, however, your key word there was augment rather than replace. I think if AI was to replace things, you end up with a machine without necessarily the quality and certainly losing the concept of your proposition of product market fit and uniqueness and USP that retailers, organisations need to have. Brilliant. Okay. Well, with that, I will say it's a wrap. Thank you very much and we will talk to you on the next one.

Other similar Episodes in Season 2:

Episode 3 - Understanding headless and Compossable

Episode 2 - Strategy and Planning

Episode 6 - Optimising physical and Digital

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