Agile @ e-commerce companies – possible?
Of course it is! 44 Bricks, one of the biggest online shops in re-selling LEGO® bricks all over the world, is doing it. They started to go agile and celebrate new records in revenue and employer satisfaction each month. Richard and Dennis, the two 28 and 29-year-old self-made CEOs, asked me for help: „Lisa, you do „that” Scrum. Can you help us to be more focused? We have recognized that it is hard for us to finish all the things on our plate. Furthermore, we would like to open new market opportunities and think more strategic, which is almost impossible because of all the tasks we are involved in.“ Yes, great challenge, thank you!
During the last five years, over 2 million LEGO® bricks per year were handled and sold by six employees and two CEOs in a 200m² storage space. Each day they receive about 40 orders and ship out boxes filled with used and new items to LEGO® fans around the world. They sort, select, sometimes wash, add them to their shop. They pick and pack them from their inventory system consisting of 12 walls with boxes and drawers of different sizes filled with over 30.000 different lots in different shapes, colors and sizes. Beside this product-related workflow they need to purchase products and supplies, maintain their high customer support standards and deal with the usual overhead that companies of their size are confronted with.
Dinner time. I met Richard and Dennis at their favorite Italian restaurant. The whole table was packed with post-its, scribbles and printed excel sheets. The first thing the two CEOs recognized when we started to talk about what „that Scrum“ actually means, was that they do not have a tangible product that is considered „done“ at some point of time. The flow of incoming orders never ends. After the first course they had understood that as a service provider their customer always is the center of their workflow. In their business, „Done” actually is the point in time when the customer receives the order and gives positive feedback. Based on that concrete thought, Richard and Dennis were able to see their service as a product. So the question, why a customer should prefer their shop to one of their 9.000 competitors, was easy to answer.
„Whenever you start a LEGO project you have to step by at 44 Bricks … they simply have everything in their shop and the service is outstanding.“ That was a perspective I loved to work with. This customers voice was my keyword to continue with. Which feedback do you receive from your customers and what would make them happy? How do you define „outstanding service”? What do customers, planning big LEGO projects, think? Where do they order and how? What needs to happen so they end up in your store? How can you see that the customer is satisfied? What is the next little step that brings you closer to your vision?
I explained the values of Scrum and led them through a quite usual client reaction process, starting from „this is not going to work at our company“, via „but I am the boss, I need to tell them what to do“ to „Don’t I???“. The main course was served. We looked at each single step of the workflow and related them to one of three working teams: the „Butchers” (who sort incoming boxes by categories and wash them), the „Packers” (who add the parts to the shop and pack the incoming orders) and the team of „Pinky and Brain” (who do customer service, accounting, strategic planning and supply acquisition). Guess to which team Richard and Dennis belong to? Each team has its very own tasks, besides those there are general tasks that everybody can do.
As the dessert was served, we tried to figure out a reasonable and transparent way to prioritize all tasks. We came up with the idea of a monthly goal that points out the focus, e.g. add 10% of the stock to the shop, or increase revenue by 10%, or the maximum lead time for incoming orders is reduced by 50%. According to those focus goals, team „Pinky and Brain“ would be able to break down and formulate daily goals on which all open tasks can be prioritized by their impact and necessity to achieve it.
Italians usually have Espresso after dinner, we had two of them. „How about buying supplies like stamps or office stationery, if they are not relevant for the focus goal?“, one of the CEOs asked. Well, these tasks will inevitably move upwards the priority line because if you run out of those essential things, you can neither reach your daily goal nor your focus goal nor your vision because you cannot dispatch anything anymore. „So we have to walk around and collect all tasks?“, they asked. How about asking your teams to collect all necessary tasks each day; everything they see, everything they think that could be relevant. „How do all of them know what is planned for each day?“ It would be great to find a way that makes synchronization possible for everybody. So they would know what is important and they could plan their working day together accordingly. Each team is responsible for finding a way to achieve their goal, for example with a daily Stand-up. „What if they don’t pull the tasks that are considered no fun?“, the CEOs were concerned. Let the teams deal with that question, they will find a way, when they understand why this very task is so essential for reaching the focus goal. If not, you can offer to help them finding a solution.
At the end of our dinner, the CEOs figured out that they are not going to do Scrum by the book. However, the first iteration of their Kanban-system was born. I sent Richard and Dennis home so they could slowly get accustomed to the idea of transparency, focus and self-organization. One week later, they invited all employees for a Friday evening beer, so they could share the current accounting numbers, the market situation as well as a future working model, called „that Scrum“. After answering all upcoming questions on their own (they owned the process, so I was only needed to stand in the back rear and nod), they invited all employees to try out the new working model within the next month.
Everybody was invited to give feedback to the board and establish their own rules, that could help them to be more successful:
Richard called me after one week of implementation and asked hysterically: “What do we do if we recognize that some employees do less than other members of the team?“ Well, I said, first of all we celebrate because we can see our progress and what is happening in our company! Yes, Scrum causes transparency and it’s a good thing. We value that something can be improved because that means we have potential to grow and get better. Besides that, you finally can do your job and lead your team to find their own solutions. Show them what you see and let them discuss, how they would like to handle it and what they would like to change within their team. “Hmm, okay“, and back he went in order to learn how to be a servant leader.
Thanks to these two innovative guys, I have learned some valuable lessons as well:
After one month Richard called me again via Skype with a smile on his face: “What do we do, if it is 3pm and there is nothing to do anymore, because the daily goal is achieved and also all the tasks below the first swim lane, from the idea box are done?“ Congratulations! You got to know Mrs Focus herself! Return to your teams, celebrate your success and ask them if they have a topic they would like to address or push forward. Furthermore, you can finally start thinking strategically again with Dennis, explore new business opportunities and come up with ideas how to serve your clients better.
44 Bricks is currently the most favorite shop around the world according to customer’s vote. They now design and sell their own t-shirt line and surprise their fans with funny scenes build by LEGO® bricks on their social network platforms. The two CEOs are currently working on important mergers with two international shops. Cheers!