Amazon is coming to Australia and New Zealand, probably! The latest reports are suggesting that they will likely be up and running by the end of 2018. Having worked in retail, I have been observing ongoing conversation about the likely impact that Amazon’s opening on our part of the world will have. There have been many stated pluses and minuses and it has been fascinating to see Amazon’s reported arrival appear as a major driver in many retailers’ strategies. There is a real sense of urgency from many retailers as they seek to transform their businesses to be prepared to compete in a post Amazon marketplace.
To make this happen most retailers are using the same old set of initiatives. Simplifying and streamlining operations, removing work through automation, better integration of customer channels and implementing agile method and approaches. It’s all good stuff and if successful, are likely to be positive for both the retailers and their customers. But in the end you have to wonder if it will be enough for most incumbent retailers. I don’t think it will (not a particularly brave prediction I know!) because to beat Amazon you have to be great and these are the tactics of good, perhaps even very good organisations, but not those of great organisations.
Wayne Gretzky is widely regarded as the greatest ice hockey player of all time. While Gretzky was a physical freak compared to us mere mortals he wasn’t particularly strong, fast or skilled compared to his professional hockey peers. So what made him so great? One of Gretzky’s most famous quotes can explain.
” A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.”
Gretzky was the best there was at playing where the puck was going to be. Our local retailers, however, are playing where the puck is. Amazon is coming and they are reacting. They need to react, and most will react effectively. After all they are well led organisations, that’s how they became successful in the first place, but it’s unlikely to be enough because Amazon isn’t playing the puck, they are playing where the puck is going to be.
Being agile, a major focus for many organisations, helps. Indeed, it is critical to your ability to react to changes in your marketplace, but being agile is about playing the puck where it is and if you are playing against Gretzky, or Amazon, it is unlikely to be enough. To compete against Gretzky and Amazon you need to play where the puck is going to be and to do that you need to develop foresight, that is, “the ability to predict what will happen or be needed in the future.”
Agility allows us to act or react effectively, whereas foresight creates time for you to walk your own path (preferably agilely) and perhaps to disrupt your competition. If you can do this it becomes possible to not only survive through digital, but to thrive.
You can begin to develop your organisational foresight by:
- Identifying and monitoring technology that matters to your customers, your business model and your competitive positioning. Not all technologies are equally important to all organisations. You need to identify those that are important and track them as they mature from “ScFi” to commercial reality. When trying to determine what technologies matter consider:
- How have other industries used a technology and what have they achieved?
- How could you take these out of industry examples and apply them to your organisation?
- How could others use this technology against you in your marketplace, with your customers?
- As these important technologies mature experiment with them to learn how they may impact you. Continue to experiment with them until you can establish a commercial case that can be scaled and leveraged or until it becomes clear the technology is not appropriate for you (at least not for now).
- Identifying alternative business models that are capable of competing with your existing business model. New and different business models is a major component of digital disruption. In many instances it isn’t the technology that disrupts it is new and different business models that disrupt. Understand what business model alternatives exist and how they could be applied to your market and your customers.
- What is their value proposition?
- What technology would enable that business model?
- What constraints exist? (technology price / performance, regulatory, size of market)
- How could these constraints be overcome?
- How could we create this business model?
The idea of foresight is powerful in supporting organisations to answer key strategic questions, however it is not limited to this and can be used in many areas. One example is that many IT teams struggle to get forward visibility of their project pipeline as a result they tend to hear about projects late in their natural life cycle and often only when they become critical. These “new” projects are usually added to a large existing workload and a team that is struggling to do everything that has already been requested. The natural reaction when this happens is to either say “no” we can’t do this because we are already overloaded, or to add it to the list and struggle to meet deadlines.
The way to change this dynamic it to gain more foresight, in this case foresight into the project pipeline. With improved foresight you can see what’s coming and begin to have discussions about what is more important and what comes first before they become critical when calm prioritisation is still possible.
There are many other ways foresight can support us to be more effective. It would be great to hear areas where you have used it to your benefit.
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