Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly on Bloomberg Radio. Well, one thing the last sixteen
Speaker 1: or a week dealing with the shutdown of our economy
Speaker 1: because of the virus has taught us all is that
Speaker 1: we are learning that we need to be nimble and
Speaker 1: adapt to the problems that confront us. And Jason, we
Speaker 1: know from many industries it means transforming their businesses, and
Speaker 1: our next guest deals with that on a pretty regular basis.
Speaker 1: She does. Indeed, Sarah Elca's partner at baine In Company,
Speaker 1: heard of it. She's also the co author of a
Speaker 1: new book called Doing Agile Right and so Understanding sort
Speaker 1: of the economy, Understanding how businesses work because it is
Speaker 1: a time of unbelievable disruption, to say the least. Sarah
Speaker 1: Jose is on the phone from Chicago. Sarah, first of all,
Speaker 1: how are you? How are is everything going in this
Speaker 1: sort of topsy turvy world for you? I'm good. Thanks
Speaker 1: for having me. It's definitely a topsy turvy world. I
Speaker 1: think has promised to bring lots of chaos. Yeah, well timed,
Speaker 1: well timed, to say the least. So I mean, give
Speaker 1: us of the sort of lead up to this book, Um,
Speaker 1: and what made you want to dig into this particular issue. Absolutely, so,
Speaker 1: we started at about eighteen months ago, and you know,
Speaker 1: with everything that's going on in the book, actually couldn't
Speaker 1: be better times. But the impetus for the book was
Speaker 1: actually conversations that we had been having with executives around
Speaker 1: how to drive more adaptability in the business. You know, historically,
Speaker 1: with traditional hierarchy and bureaucracy, we've gotten really good at
Speaker 1: running our business, but we haven't done as well in
Speaker 1: terms of balancing towards changing our business. And obviously that
Speaker 1: will vary by by industry and specific company strategy, but
Speaker 1: it was really this recognition that we need to help
Speaker 1: companies figure out how to both run and change their
Speaker 1: business and then harmonize both of those without destroying either one.
Speaker 1: It's not easy, and I feel like this goes to
Speaker 1: some extent, Um, Sarah conversation Jason I had with the
Speaker 1: former Honeywell UH CEO David Cody about this managing of
Speaker 1: kind of law in short term aspects of running a
Speaker 1: company in a business, right, because they both have different parameters,
Speaker 1: they both have different demands and needs, and yet you
Speaker 1: kind of got to do both at the same time, right,
Speaker 1: you know, short term long term is certainly one aspect
Speaker 1: of it, but another aspect would be just variability itself.
Speaker 1: You know, if if we're trying to run our business,
Speaker 1: we're looking at routine operations, we're looking at repeatability, quality, efficiency.
Speaker 1: You know, we're trying to drive out variation. But if
Speaker 1: we want to grow and drive revenue and innovate, we're
Speaker 1: actually trying to increase variation. And so how do I
Speaker 1: allow my company to do both of those things at
Speaker 1: the same time? And there's there's really an art and
Speaker 1: a science to that. So what was the biggest I
Speaker 1: always ask people who wrote who have written books that
Speaker 1: what was the biggest surprise along the way? Because you
Speaker 1: did so much research, you talked to so many people.
Speaker 1: I mean, is there a conversation or a data point
Speaker 1: or something that you and your co authors came across
Speaker 1: where you thought, Wow, I did not see that coming.
Speaker 1: You know. A funny one is that the book publishing
Speaker 1: process is decidedly not agile. It is the worst. That's
Speaker 1: the worst, I will say it. And it's even stronger
Speaker 1: than you like. It is the most antiquated backwards like
Speaker 1: mind bending like you just can't even get your head
Speaker 1: around it, and you you're talking to people and you're like,
Speaker 1: are you serious right now? It's amazing And I have
Speaker 1: to say sorry, Jason will do it because he's pretty humble,
Speaker 1: but he's written two books, so he knows his firsthand
Speaker 1: as well. Yeah, so you absolutely know that. I would
Speaker 1: say from an insight standpoint, one of the interesting things
Speaker 1: is that the companies that are actually further along on
Speaker 1: this journey and have really mastered how to drive adaptability
Speaker 1: with speed are also really strong learning organizations. They're very
Speaker 1: customer centric, and they would say that they're still on
Speaker 1: the journey. So no one is declaring victory. And the
Speaker 1: companies that are actually more in that direction would say
Speaker 1: they just see so much more, much much more further
Speaker 1: that they have to go um and so it's just
Speaker 1: interesting that they would declare themselves as not in the
Speaker 1: lead because they see the potential. So, Sarah, as Carol
Speaker 1: pointed out, you have a lot of experience in retail.
Speaker 1: Retail has been unbelievably disrupted here. What happens next? Yeah,
Speaker 1: it's a great question. Fortunately I don't have a crystal ball,
Speaker 1: but what I can tell you is the disruption that
Speaker 1: we're experiencing is a lot of acceleration of what we've
Speaker 1: already been seeing in retail, those store closures, bankruptcies, you know,
Speaker 1: the increase in e commerce and the need to you know,
Speaker 1: transform their business pretty much top to bottom. Uh. You know,
Speaker 1: what we saw with COVID is probably a two to
Speaker 1: three year acceleration in in e commerce penetration curves. Uh.
Speaker 1: What we're also seeing that's different with COVID is a heightened, uh,
Speaker 1: sense of focus on customer experience. We know that when
Speaker 1: we're in a time of recovery, customers pay more attention
Speaker 1: to where their dollars go, and you end up seeing
Speaker 1: greater share shift and so the winners win more and
Speaker 1: the losers lose more. You know. It's just such an
Speaker 1: interesting time. UM. And I know you guys in this book,
Speaker 1: you know, just look at a lot of different worlds
Speaker 1: and have talked to a lot of different leaders. I
Speaker 1: do wonder a lot more to about the retail environment,
Speaker 1: which is an area that you've worked within. I mean,
Speaker 1: what do you expect, like, what does retail look like?
Speaker 1: I don't know is it I don't even know what
Speaker 1: the time frame is because I know it's continuing to evolve,
Speaker 1: but it just feels like we're seeing a lot of
Speaker 1: fallout because of the shutdown, like those that were the
Speaker 1: most vulnerable. But what do you think it looks like,
Speaker 1: Sarah in a few years. I think we'll continue to
Speaker 1: see some fallout. There will be companies that are able
Speaker 1: to make the transformation journey that they have the resources
Speaker 1: in order to be able to invest in. There are
Speaker 1: companies that won't make it. And I think the key
Speaker 1: difference is going to be adaptability. Uh. And so you know,
Speaker 1: back to agile and how do you build this agile
Speaker 1: business stone. You need to be able to have a leadership,
Speaker 1: mindset and focus that puts the customer first and really
Speaker 1: drives home that customer centricity that focuses on prototyping solutions
Speaker 1: with strong feedback loops and being able to scale those
Speaker 1: and and roll those out to meet customer needs. So, Sarah,
Speaker 1: as you talked to CEOs as they're going through this
Speaker 1: right now, I mean, we talked to so many CEOs
Speaker 1: all the time, and it does feel like something different
Speaker 1: is going on in board rooms and something transformational is happening.
Speaker 1: There's a huge amount of self reflection the pandemic obviously
Speaker 1: has made us all a bit more self reflective. And
Speaker 1: I think especially those of us who were fortunate too,
Speaker 1: and we say this all the time, fortunate to have jobs,
Speaker 1: fortunate to you know, be in a position where we
Speaker 1: can work from home, where we have childcare in many cases,
Speaker 1: and we have the ability to to to take the
Speaker 1: time to to self reflect. Is that happening to the
Speaker 1: extent that we hope it is in in boardrooms or
Speaker 1: are too many ceo is just saying we just got
Speaker 1: to get through this. No, I think it's starting to
Speaker 1: happen in terms of the reflection. We're shifting from sort
Speaker 1: of this uh need to act and respond, almost in
Speaker 1: crisis mode too. Now how do we retool our business?
Speaker 1: And so what we're seeing is this shift from what
Speaker 1: I'll call sporadic agile into systematic agile, meaning how do
Speaker 1: I build that into my company for the long term.
Speaker 1: Because CEOs are reflecting and and a lot of them
Speaker 1: are saying that they've never been more proud of their people,
Speaker 1: you know, They've they focus on specific missions in response
Speaker 1: to the crisis, They've come together in new ways, often
Speaker 1: cross functionally. They're working together differently and they've achieved great things.
Speaker 1: Now how do we do that again and again and again. Yeah,
Speaker 1: I mean that's the thing, you know, in terms of
Speaker 1: I also do wonder too when you say that how
Speaker 1: many companies will be because of the pressures that are
Speaker 1: going to be on them, that they're going to have to,
Speaker 1: once again, like coming off the financial crisis, have to
Speaker 1: do more with less, and what pressures that put on
Speaker 1: workers as they're trying to potentially transform their companies. Yeah,
Speaker 1: I mean, certainly you're going to have to have an
Speaker 1: investment capacity in order to you know, fund technology and data. Uh,
Speaker 1: you know, make the investments that you need. You know,
Speaker 1: at Banning Company, we spent a lot of time looking
Speaker 1: at recovering retooling, and you know, those that invest through
Speaker 1: the recovery often, uh, you know, have strategic advantage coming
Speaker 1: out of the recovery. You know, now is the time
Speaker 1: to invest, Now is the time to be customer centric
Speaker 1: and and that adaptability for those for those companies that
Speaker 1: do that, you know they will be the ones to win.
Speaker 1: All right. Sarah Elk, thank you so much. Congrats on
Speaker 1: the book Doing Agile Right. She's a partner at Banning Company.
Speaker 1: Join us on the phone from Chicago