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Corra Consulting - When Retail Bombogenesis Happens

27January

When Retail Bombogenesis Happens

Good luck? Bad luck? Who knows?

The Story of the Chinese Farmer.  Published on Jul 10, 2014 A parable about life and nature narrated by Alan Watts, animated by Steve Agnos, and with music by Chris Zabriskie.

 

Yesterday, the universe smacked the East Coast with a Bombogenesis, which according to The Weather Channel’s Kevin Roth is the equivalent of a “meteorological bomb.” So, was this good luck, or was it bad luck? Or, like the farmer in the Chinese tale, should we reply, “Good luck? Bad luck? Who knows?” In business, sometimes we unnecessarily complicate things. When numbers grow, a team spends too much time basking in their good fortune; and, conversely, when numbers are in decline, the focus can shift to “Why us?” instead of “What’s next?”

So, when we’re faced with a bomb--whether in the form of a consumer product launch (e.g., Amazon’s Fire Phone), a retail market entry (e.g., Target Canada), a merchandising strategy (e.g., Ron Johnson’s JCPenney overhaul) or something else entirely, maybe the only right response is: “Good luck? Bad luck? Who knows?” In today’s market, it’s how we move forward from successes or failures that determine whether a business fails or persists or succeeds. Some may be reading this and argue that luck is irrelevant and that all of these examples cited had nothing to do with luck and everything to do with market preparedness.

Did Amazon’s team need luck, or a rethink to their competitive positioning/pricing strategy? Could luck have saved Target Canada, or could it have avoided losses if they selected different locations, not launched so many doors at once, or if they had a stronger replenishment plan that preserved healthier stock levels? Did Johnson need luck or simply a desire to test his solutions and stage store changes more gradually over time and with a more conservative capital burn rate?

For every one of these that might have been remedied with better analysis or preparation, there could be three other case studies that we never hear about that tell a story of luck. And, really, how many companies are willing to come forward and say, “Look at us. We’re lucky”? Most everyone wants to say, “Look at us. We’re good.” I contend, however, that somewhere in business are the “Daniel Navas,” who, as luck would have it, were given the opportunity to come up to the plate on a specific day and time when they were ready and able to hit a grand slam.

And, if we can all agree that a little luck never really hurts anyone, then we can focus on the more substantial question at hand. Luck aside, what are the qualities I've observed in successful businesses that can move forward from the good and bad?

  1. Be Nimble and Quick. Why do I love consulting for small - mid-size businesses? It’s fun being the David that competes with the market’s Goliaths. Goliaths often need an act of Congress to get their organizations to embrace a change of course. As David, you just need to make some phone calls, build consensus, and go.
  2. Simple and Shared Goals. Everyone likes to be part of a winning team. But, to win, every member of the team has to be working towards the same goals. To succeed, I have noticed that all areas of the company--whether in sales, merchandising/marketing, finance or operations--are working together.
  3. Execution. Some call it analysis paralysis. I call it unfortunate delay. Don’t wait for perfect in every instance--just do. I have seen companies succeed by taking the first step and being smart enough to become better as they go. And, if you’re going to fail, just fail fast.

The bottom line is that there is something to be learned from every “Retail Bombogenesis,” but like the farmer, I think we should worry less about why it happened and what it means and instead ask, “So, what’s next?”

 


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