To juice their businesses retailers had traditionally looked for new strategic ideas from their favoured big-time consultants such as McKinsey, Bain and Boston Consulting Group.
To some extent they still do, but the more savvy merchants have realised they also need to look to where the real action is – with technology start-ups. The future success of the bigger retailers is increasingly about injecting some of the smaller firms’ ideas and sense of urgency. They are the ones shining a light on the future.
This is clear to Scott Weavers-Wright, founder of Kiddcare (part of Morrisons), who has stated that the real challenge for him and the Morrisons management is to be agile when running a £17 billion oil tanker.
“We used to land things [new technology applications] quickly at Kiddicare and you need agile teams to be able to knock out new technologies otherwise you’ll be behind for years,” he warns.
To keep ahead of the pack he visits San Francisco and Silicon Valley where he has used the technology from a start-up to efficiently host videos online, and the company’s in-store Wi-Fi has also been enabled by a small tech firm from across the pond.
Shop Direct Group is also aware of the benefits of leveraging the products and also the mind-sets of start-ups. Jonathan Wall, group e-commerce director at SDG, recently spent time in another of the world’s technology and venture capital hot-spots Israel with some interesting companies that will likely lead to some cutting edge things appearing at Shop Direct Group some time soon.
It is a similar story at Tesco that is seeking to tap into the start-up mentality through its recently opened office in Shoreditch (home of many technology start-ups) that is housing its mobile app developers. The move will enable Tesco to utilise the specific technology know-how in the area and to more easily recruit the relevant talent.
The reality is these people wouldn’t want to work out of the company’s Cheshunt, Hertfordshire, head office. This is indicative of how today’s retailers are having to look in very different areas if they are to succeed in a digital marketplace.
This is increasingly in Silicon Valley, Israel and Shoreditch rather than sat around a board room table with old-school thinkers.