Tirrell Payton of Scrum Alliance: “Operational effectiveness and efficient supply chains”

One company that I can think about that’s innovating in the pandemic in a way that no one has ever seen before is Walmart. They have partnered with Instacart to accelerate home delivery. They have absolutely rewritten the playbook on online grocery pickup, and reacted very well to the uncertainty of the pandemic by falling […]

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One company that I can think about that’s innovating in the pandemic in a way that no one has ever seen before is Walmart. They have partnered with Instacart to accelerate home delivery. They have absolutely rewritten the playbook on online grocery pickup, and reacted very well to the uncertainty of the pandemic by falling back on what they’ve always been good at: operational effectiveness and efficient supply chains.

As part of our series about the future of retail, I had the pleasure of interviewing Tirrell Payton. He is a Scrum Alliance Certified Agile Coach® and consultant at Nooma Group, where he serves senior clients in the retail and pharmaceutical industries. He lives in sunny San Diego California and is a proud graduate of Northwestern’s Kellogg School of Management.

Thank you so much for joining us in this interview series! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a story about what brought you to this specific career path?

My ‘first career’ was as a software engineer, then a project manager. In the course of my work as a project manager, I happened across agile and the Scrum Alliance, and started down my path to certification while continuing to work in the software industry. After 10 years in software, I went to grad school and moved into consulting. *When the magic happened* was when I applied agile thinking to traditional strategy consulting problems. It created a direct yet counterintuitive way to solve business problems iteratively.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson or takeaway you learned from that?

While not the funniest, certainly the one I learned the most from was a failed transformation that I was leading. I was relatively early in my career, so it was bound to happen. However, if you’ve never had a flaming failure in your professional career, the first one stings the most.

I was asked to lead an ‘Agile Transformation’ at a major telecom. They had all the expected corporate pathologies: strong structural silos, pathologically bureaucratic processes, and a perpetually underemployed workforce. I call these out because these kinds of organizational issues were the root cause of some of the challenges I saw on the ground. Only back then, I didn’t have the awareness of the importance of company culture and organizational systems thinking the way I do now.

To make a long story short, I kept trying to solve deep issues of culture with process tweaks. If you want to know how that works, imagine pushing a wet piece of string up a hill. Not my proudest moment, but certainly one that helped me grow.

Are you working on any new exciting projects now? How do you think that might help people?

Thinking about agile in the course of ‘Entrepreneurship Through Acquisition,’ which is kind of like private equity lite, with more of a focus on operational excellence rather than financial engineering. In short, I’m thinking about how to use agile in a private equity “acquisition and turnaround” scenario. To that end, I am actively looking for companies to acquire.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

I’m sure they have heard this in many places, but you have to take care of yourself first. The challenge with high performance is that you have to take care of your engine. Your engine being your body and your mind. And I don’t mean simply making time for vacation and relaxation, I also mean proactively taking care of yourself as if your livelihood depends on it. It’s almost the same way we think about athletes. You have to pay attention to your nutrition, your sleep, your exercise, and to your mental health. Paying attention to your mental health is probably the most important part of avoiding burnout. You will continue to look at your own signals to figure out when you need a break. Listen to your body.

None of us are able to achieve success without some help along the way. Is there a particular person to whom you are grateful, who helped get you to where you are? Can you share a story?

Oh yes, my manager when I was an engineer back at Yahoo. He could tell I was getting bored and restless, so one day I asked him, “Hey can I go somewhere?”. He says, “Sure, there’s some kind of Scrum Master class at the headquarters in Sunnyvale. Go take it, come back and tell us what it’s all about.” This was my introduction to Agile, a Certified ScrumMaster® course. That class put me on the path I’m on today. Thanks Philip!

Ok super. Now let’s jump to the main questions of our interview. The pandemic has changed many aspects of all of our lives. One of them is the fact that so many of us have gotten used to shopping almost exclusively online. Can you share five examples of different ideas that large retail outlets are implementing to adapt to the new realities created by the pandemic?

One company that I can think about that’s innovating in the pandemic in a way that no one has ever seen before is Walmart. They have partnered with Instacart to accelerate home delivery. They have absolutely rewritten the playbook on online grocery pickup, and reacted very well to the uncertainty of the pandemic by falling back on what they’ve always been good at: operational effectiveness and efficient supply chains.

Macy’s has partnered with Doordash to accelerate same day delivery on e-commerce purchases. They are using their stores as warehouses and using Doordash as their last-mile logistics system. It’s quite interesting.

Woolworths down in Australia responded to the need for essentials by creating a product called Woolworth’s Basic Box. It’s an 80 dollars box of basic groceries and was developed in conjunction with Australia Post and other distribution channels to get orders to isolated people faster. The box includes meals, snacks and a few essential items.

Carmax invested 300 million dollars in their digital transformation efforts, implementing a hybrid experience that includes a robust omnichannel shopping experience, robust car cleaning and safety protocols, and a renewed sense of customer experience. They essentially borrowed the retail playbook even though they are not a typical retailer.

With all this innovation afoot and a digital dogfight over consumers’ dollars, it will be interesting to see how this acceleration to digital and omnichannel impacts the holiday shopping season.

In your opinion, will retail stores or malls continue to exist? How would you articulate the role of physical retail spaces at a time when online commerce platforms like Amazon Prime or Instacart can deliver the same day or the next day?

In my opinion, as long as there are “experiential products,” there will be retail stores. While we can digitally approximate many aspects of a consumer good (i.e., size, color), we do not have the technology to approximate the senses people use to make product decisions (i.e., touch, taste, smell). People need to experience products physically.

The so-called “Retail Apocalypse” has been going on for about a decade. While many retailers are struggling, some retailers, like Lululemon, Kroger, and Costco are quite profitable. Can you share a few lessons that other retailers can learn from the success of profitable retailers?

To me, it’s simple: The successful retailers have a deep understanding of their customer. They don’t try to be all things for all people. Costco, for example, has high quality products with a limited selection. And if you think limited selection is a bad thing, you don’t understand their target market: stressed shoppers, usually parents, who have to make 3,000 decisions a day. For parents, going to the store and having to examine 5 different types of ketchup feels like a special type of torture. On the other hand, when you go to Costco, you get what you need, you get it in bulk, there’s usually one product per type, and you can be assured that the price/quality balance is very favorable, especially if it’s their in house brand Kirkland, which has loyal if not rabid fans.

To create rabid fans, you need to have a deep understanding of your customers. And rabid fans are one of the best moats to build a robust, defensible, and resilient business.

Amazon is going to exert pressure on all of retail for the foreseeable future. New Direct-To-Consumer companies based in China are emerging that offer prices that are much cheaper than US and European brands. What would you advise to retail companies and e-commerce companies, for them to be successful in the face of such strong competition?

I would advise them not to make price the primary dimension upon which you compete. If you think about it, these direct-to-consumer (DTC) companies shipping out of China can really only compete on price. So why would you go head to head where they’re the strongest, when they’re pretty weak everywhere else. Take your pick:

  • Marketing: They don’t typically have any marketing capability, they rely on Amazon to funnel traffic/sales
  • Customer Service: These companies typically don’t have customer service to speak of, unless you count a sparsely-manned email address
  • Quality: High quality and low price don’t typically exist together, and these DTC companies do not compete on quality. Their play is price and volume.

My point being that companies can choose where they want to play as far as competitive dimensions; Choosing anything other than price is a good move. If you are a product maker and you’re not yet competing with China, you soon will be, and they can pump out ‘me too’ products very quickly and cheaply. You will be toast if you try to compete on price.

How can our readers further follow your work?

You can find me on NoomaGroup, Scrum Alliance, or LinkedIn.

This was very inspiring. Thank you so much for joining us!

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