Consumer needs, Digital Transformation, and Learning
Changing behavior helps change mindsets
It’s often said that change is difficult. But sometimes what we’re really seeing is a resistance to being changed—especially in large organizations with established business practices. These are the companies that have operated successfully for years, and they have a well-entrenched governance apparatus. They have minimized risk and maximized bureaucracy. But problems arise when it’s time to be more agile, and respond to the changing wants and needs of customers.
Slow by design
Every company wants to be successful. They want to be leaders in their industries. However, the biggest impediment is often the company’s structure itself. The fact of the matter is that many companies are structured such that they are slow by design. Internal areas can find themselves slowed down by the volley of debates, emails, and requests for information or approvals. In this convoluted scenario, we’ve seen that it can take up to 24 months to come up with an idea and put a new product in the hands of the consumer. But the real tragedy here is that we lose an opportunity to learn from and listen to the consumer.
The other challenge facing companies is that the marketplace is changing so rapidly that consumers expect better products faster than ever before. And to win the hearts and minds of consumers, we have to be agile.
But how can we effectively convince middle management that speed is important—especially if they helped create the status quo? Granted, they’re successful today. But they won’t be successful in 15 years without changing their mindsets.
To battle this type of organizational inertia, there are internal battles that need to take place. Perhaps the biggest battle is against the “project mindset,” where teams are focused so narrowly on delivering a project that they lose sight of creating a new value stream that leads to products and services that delight the consumer.
Case study: Beverages in Brazil
To operate a global company with a universally recognized brand is no simple undertaking. One beverage giant that we have worked with, for instance, had to create complex organizational structures to effectively manage over tens of thousands of employees and 50+ subsidiaries. As such, it should come as no surprise that this beverage maker also invested substantial time and resources into creating an internal bureaucracy that can manage an operation of this size.
Legal prioritizes compliance and contracts. IT aims for efficiency and standardization. And marketing focuses on brand recognition. But within such a complex organization, what role does the voice of the customer have in creating new products? Is there room for having a customer-obsessive mindset?
This was the question we posed to one beverage maker in Brazil. To find a solution, CI&T helped create an initiative for still, non-carbonated drinks—and implemented a new and experimental operating model that focuses on what the consumer really wants. The idea was to create a value stream—or a mini company within a company—comprising people from different areas of the organization. Meanwhile, CI&T brought a digital squad to help further the process of rethinking how to deliver products to the consumer. And in doing so, we helped transform the way people worked and thought about their work.
We learned about what customers wanted in terms of freshness, natural ingredients, and transparency about nutritional value. This experimental team set a self-imposed timeline of three months to launch a new juice. Granted, there were lots of restrictions to achieve such a feat, but the team was empowered to bypass existing frameworks, to come up with its own creative solutions, and to leverage different options. For instance, to deliver this new juice that aligned with the wants of the consumer, we could not use the existing product line. Instead, the team went ahead and contracted a co-packer.
Through this process, we were able to deliver a new product within three months. Further, we were able to learn with how to navigate a new distribution model while working with new distribution partners—all with the goal of delivering greater value to the marketplace.
This led to a profound way in which this beverage maker was organized, incentivized, what they were looking for, and how they worked. It also helped establish new ways of working.
What we learned from this experience harkens back to a quote from John Shook of the Lean Institute, “It’s easier to change the way you think by changing the way you act, than the other way around.” Changing minds is not only difficult, but how do you begin to measure such a thing? Instead, changing behavior almost forces people to think in new ways.
It’s also key that everyone—from the CEO on down—develops a keen appreciation for the importance of speed. The marketplace is changing in the blink of an eye. Being too slow is the biggest risk today. Companies need to be organized to maximize speed.
This begs the question: How do you pitch the case for creating an organization that is 10x better and more responsive to consumers? Your colleagues have heard it before—”we need to do [fill in the blank] better.” There’s a natural sense of skepticism that arises over the years.
To combat this resistance, however, we need to create a mini company within our organization. Look for people who can be 100% committed to a new value stream that is focused on meeting a real consumer need. Perhaps your organization is having problems capturing customer feedback or your supply chain has experienced one disruption too many. This is where you want to focus your attention.
But don’t expect miracles to happen over night. Teams need the right type of environment—one that allows them to experiment and fail on their way to success. You’ll find in short order that the learning cycle will be quicker than you ever imagined. And much like other organizations that have mastered Lean principles, you’ll be perfectly situated to connect with the wants and needs of your customers.