When the consumer world changes faster than you can react to it – it’s time to act like a dot com. But why?
Having worked in both a dot com and agency-side, my main observation is that dot coms tend to act very differently in comparison to multi-channel businesses – especially those businesses that have ‘added digital on’ to more traditional ‘offline’ routes to market in recent years.
In large, I put this down to the fact that years ago dot coms recognised that their consumer world changed faster than they could react to it. This drove them to internally re-align their people, process and technology to enable them to be ‘as reactive’ to even the fastest consumer change. A byproduct of this thinking and doing is that it drives innovation.
So what lessons can all companies learn from dot com’s behaviour?
Dot coms generally take four themes that depend on each other to work, and they deliver this through in-house cross-functional autonomous teams, setting their own rules.
Align for success
The first theme is they align their organisation for success. This is not by grouping disciplines together into a marketing department, an IT department and design department, for example, because this type of grouping promotes a lack of collaboration, increases blame culture and waste. They look at their product offering and split it into a set of smaller stand-alone products and align a mix of disciplines into cross-functional teams that own these discreet parts of the overall product.
The second theme is that this team are then given problems to solve – and not given predefined solutions. They take ownership and accountability for solving a business problem; this is a fundamental part of empowerment and autonomy. A team that is given the problem of increasing their conversion by 3% will create more innovative ways to solve that problem and, in many ways, over deliver as opposed to being told to simply change all the buttons to blue as blue converts better.
Fast feedback loops
The third theme is that they create fast feedback loops applying a ‘build – measure – learn’ culture.
Teams effectively define a hypothesis that solves a given problem, deliver an MVP (minimal viable product) against it as fast as possible, then measure it. The team learn and iterate on the product until a point where the value return is not worth further investment – exploiting the 80% of the value from 20% of the effort rule. The team moves on to their next priority hypothesis and value and repeats the process.
Culture of continuous improvement and learning
Underpinning these three themes is the fact that dot coms invest in supporting a culture of continuous improvement and learning; allowing the team to challenge everything, and take the time to remove constraints and dependencies or blockers in process and technology that inhibit the teams to iterate as fast as possible.
As an example, if two teams rely on a shared system, process or dependency which causes delay in the way those teams operate or improve, the teams must aim to remove the dependency so they can work again more autonomously – and not accept it as immoveable.
I believe behaving like a dot com is where a big step change can happen for non-dot com companies, which don’t have the maturity or size of team to iterate at this speed and with such depth of insight; and by working with an agency that does take a dot com approach.
Dot coms rarely create a large pre-defined solution, then build it, instead they work out what single change would add the most value to their business, prototype it, measure, build and learn – making iterative improvements before moving on to the next thing.
They take an MVP (minimal viable product) approach to everything. The MVP line is the minimum set of features (driven by their necessity, value and user feedback) that you believe are the items that you can go live with to create a great experience.
Going live here reduces risk from the technical delivery, but also validates that we are going in the right direction whilst creating revenue return far earlier.
While this approach isn’t necessarily for the faint hearted, because it relies on a belief that you must be prepared to change direction based on real-time consumer use, we believe being iterative and adaptive, evolving client products not working to static project plans, is vital in achieving digital transformation.
Dave Heath is technical director at digital agency Code Computerlove.