Managing Aggressive Growth
Somewhere, upstream, probably in an executive suite, a big title proclaimed, “This year! This year we will grow/expand/profit/acquire 50%/75%/100%.” The verbs and percentages don’t really matter. Fortune 500 or startup, it doesn’t matter. What is material is the big, rolling, steaming ball of enthusiasm coming down the hill, aiming straight at you.
When ecommerce companies speak about aggressive growth, they talk in terms of sales, acquisition, and funnels. Ecommerce companies rarely speak about their plans to aggressively grow operations. It’s not sexy. Plans to build more fixed capital and expand resource costs don’t bring comfort.
And, this is why the decisions to aggressively grow ecommerce businesses often do not include strategies to aggressively grow supply chain, order management, inventory distribution and fulfillment at the same time. The failure to account for the additional load on operations is also the reason many of these “aggressive growth” plans either flash and burn in the pan or stumble across the finish line years behind schedule and a skeleton of the original concept.
So what to do? You can’t restrict growth, and operations can only tread water so long. Below are some savvy tips for tackling aggressive growth cycles for ecommerce operations.
Build for the Future
Build for the Future? Like “living on the moon” future? I get it. That phrase is a little played out. However, there is some truth about building for the future. Posed from a different angle, Amazon executives frequently ask, “Will it scale?”.
Building and planning for ecommerce operations; outside of significant investments, e.g., fulfillment and distribution centers, are best positioned when conducted with a view of the 3-5 year horizon. Aggressive operations growth strategies must take into consideration not only the revenue growth goals but also catalog or product expansion, service innovation, customer acquisition shifts and impacts to inventory distribution.
For clarification, building for a 3-5 year horizon does not mean building for 3-5 years. It involves delivering a solution that upon go-live will scale for the next 3-5. What happens if companies do not anticipate the mid-future when crafting ecommerce operations strategies? Or even worse, actually do spend 3-5 years developing a solution? They never stop catching up. They never stop spending.
Contrary to what many CIOs will tell you, technology is not the answer, at least not on its own. Operations technology must be implemented with business processes that support the workflow of the tools implemented. This conversation is not always easy, as many users feel the technology should match the existing process, especially THEIR process. Matching new technology to existing methods is a backward facing position.
Instead of preserving the time-honored processes, companies need to refine them. Implementing new technology, designed to support the 3-5 year goals, is an excellent opportunity to polish current workflows and redistribute responsibilities. Anything less will lead to de-optimization of the new, and likely expensive, technology and continued challenges with scale.
Don’t Forget the Humans
Nothing can throw a wrench in works like a human. Have you ever seen a human dig their heels in on something new, just flat out refuse? Yep, it’s frustrating. Humans can be tricky, especially in the face of change.
Many leaders and employees have good reason to resist. Previous attempts at modernization or scale have failed, costing the teams time, energy and emotions. Some leaders feel their voices are never heard or respected.
Engaging with leaders and employees early and often is imperative for managing aggressive growth. Setting team level goals, at all levels, and providing timelines for milestones eases tensions and offers an opportunity to plan and groom for success. Engaging users in the refining of processes builds buy-in and ownership. The most frequent concern I hear is, “I just want to know what’s going on.” So, tell them.