Step by Step Season 8 Episode 4
September 1, 2022

[Step by Step] How Do I Move From a Project Mindset to a Program Mindset?

For our 4th episode of Step by Step Season 8, we’re covering how you can take your brand from having an eCommerce project mindset to a program mindset. Jon Reily from bounteous is here to chat about the difficult parts of shifting mindsets, how we're rewriting the rules, and more! Tune in now!

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A North Star or a South Star?

  • Currently, a lot of brands are struggling with how to move from having an eCommerce project mindset to a program mindset. The most difficult part is that brands need to break the stigma that eCommerce is this big scary thing when it's not.
  • “We went from calling things just selling things online to eCommerce and then we went back to, well, maybe just selling things online again. Have we come full circle?” – Brian
  • “It all comes back to the design and you have to ensure that the design is solid in order to make it work.” – Jon
  • “The downside of all of these tools being out there and being ubiquitous and available to virtually everybody is it's like everything's a nail and we're walking around with hammers trying to find where to use them.” – Jon
  • In some ways, the programs still need to be in place as you build the foundation, or else you’ll be painting when you haven't finished the foundation.
  • We are rewriting the rules of eCommerce every day because there is no set way to do things, we’re all learning every day and channels are seeking out answers every day.
  • “Every single piece of disruption that takes place in a sector, in the following sector, the disruption happens twice as fast.” — Jon
  • The systems that we build have to be able to flex in the future.
  • The simple fact is that everyone needs to agree on what the end state is, define the end goal, and have a long-term plan. 

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Phillip: [00:00:11] Step by Step is brought to you by fabric. fabric is a leading modular and headless enterpriseCommerce platform, helping brands and retailers to innovate and scale. Learn more about fabric today at fabric.inc/FutureCommerce. Hello and welcome to Step by Step, a podcast by FutureCommerce presented by fabric. I'm Phillip.

Brian: [00:00:42] And I'm Brian.

Phillip: [00:00:43] And this is Season 8 of Step by Step. And if you are listening right now, you are listening to Episode 4 of 5. So if you're just jumping into the series midway through, I suggest that you go back and listen from the very beginning, because, in this five-part series, we will break down exactly what you need to do to make a sound investment in differentiated online experiences. And we're going to bring it all to you Step by Step.

Brian: [00:01:09] This season, we are answering the question, "How can I make the business case for my brand to invest in experiences?" And I think this is a really important question right now, Phillip, because there are a lot of opportunities out there right now, a lot of confusing paths. It feels like there are many ways to go. We see things like headless or composable or MACH Alliance or whatever acronym that you may see out there. And it's just that commerce is continually changing and there are multiple ways to go about creating an experience for your customers. So if you feel a little overwhelmed about where to go with this and actually make a smart investment in digital commerce experiences, then this podcast is for you.

Phillip: [00:02:01] Yeah. And Brian, I know we've said this now I think three times already this week, but it's remarkable how often I go online and I'm shopping on a website and I don't need to see anything that tips the hand, but I just get sort of an almost a spiritual feeling like, oh, I know exactly what eCommerce shop is running this storefront. I know the technology that's powering this right now.

Brian: [00:02:34] You get the tingles.

Phillip: [00:02:34] I get the tingle, it's the Peter Tingle. I get it. I know exactly what this stack is because it feels just like everything else. It doesn't have to be that way. And so I'm hoping that this series helps people to make the case internally to fund differentiation and to fund creating new and exciting different types of experiences for brands. And I'm hoping not only do we help you make the case but that you'll make sound decisions in choosing technology partners and just building better, architecting your team better, and moving to the next type of building in eCommerce where it's not just one and done. It's not big pops or big bangs. We're going to shift our organizations to progressive enhancement. I'm really excited for that.

Brian: [00:03:28] Yes. So if you're a marketer and you can't make heads or tails of what headless is all about, or you're in technology and you're concerned about choosing the right platforms to give those marketers the tools they need, then this podcast is something you should be listening to.

Phillip: [00:03:46] Yeah, and thank you if you are listening to it right now. So without any further ado, let's get into this fourth episode. It's a fascinating listen. I can't wait for you to hear it. So let's join our friend Jon Reilly, who is the SVP of theCommerce Center of Excellence at Bounteous, as we answer the question, how can my brand move from having an eCommerce project mindset to a program mindset? Let's take a listen. We are continuing our Step by Step series today with the SVP of theCommerce Center of Excellence at Bounteous. Mr. Jon Reilly, welcome to the show.

Jon Reilly: [00:04:27] Thanks. I appreciate being here and thanks for having me.

Phillip: [00:04:29] We're glad to have you. Today we are continuing our series here about how experience is a differentiator. And we're setting out to answer a question, a big question that is top of everyone's mind right now. How can my brand move from having an eCommerce project mindset to a program mindset? And we're going to lean on you today, Jon, to give us a little bit of that guiding light, that North Star of how we can get away from this legacy idea of big builds, big software investments, big bangs into continual investment. What makes you uniquely qualified to talk about this here today?

Jon Reilly: [00:05:16] Well, for starters, I've been in the entire history of eCommerce since before we called it eCommerce, when we used to call it "selling online." But we're entering the fourth decade of eCommerce now, which is kind of crazy to consider, but it's the truth. And to your overarching point, how do you move from that program of, we've got to go out, we've got to build this, we've got to create this to more of a caring, feeding mentality where it's part of your DNA. A lot of brands are struggling with that, and the difficult part for most brands is breaking that mindset of eCommerce being this big, scary thing and not just how we do business today. And the fact of the matter is, it's just how we do business today. All of these are now table stakes. And the short answer is, as a result, it shouldn't be a giant program. It needs to be something you do every day.

Phillip: [00:06:04] Yeah, Brian, you know a lot about that, right?

Brian: [00:06:09] Oh, yeah. I mean, I am pro moving things to an iterative basis. And I think that that's essential. And I feel like it's so funny. We went from calling things like just selling things online to eCommerce and then we went back to, well, maybe it's just selling things online again. Have we come full circle on the eCommerce turn here? {laughter}

Jon Reilly: [00:06:36] I guess in a way, I mean, maybe when you stop and think about it, part of it is we're all consumers too. People don't really think about channels the way we do in the market. We do this every day. We think about different ways these customers are coming to us. But at the end of the day, when somebody is dealing with Best Buy, whether they buy it online or they buy it in-store, they're buying it from Best Buy. And their interest in online or offline is starting to wane where those channels are starting to blur an awful lot and a lot of retailers are struggling with that and how best to operationalize that, realize what these customers want, where they're coming from, and more importantly, how they can service them on the long tail as opposed to having to sell to them each and every single time.

Phillip: [00:07:20] There's such a really powerful concept there behind that, which is innovation used to happen in big leaps, right? So we'd have big leaps forward in infrastructure, we'd have big leaps forward in software that makes use of that new infrastructure capability. But today we've sort of reached maybe that law of large numbers where everything sort of is equalized. We're having much smaller gains both on software functionality and capability side, and most everything is priced pretty equally now and most everything is functionally equal now, or at least that's my perspective in the ecosystem. What's your perspective on how we're shifting that mindset? Is that really a function of the fact that really the pace of innovation is kind of slowed down and found the product market fit that everybody needs?

Jon Reilly: [00:08:15] So I wouldn't necessarily say that, but rather a combination of things have occurred. So one, you have what used to be these monolithic platforms of commerce: ATG, Hybris, all these big guys. You go out, you're going to buy a box, it's $1,000,000, you take it and you sell commerce. But that innovation that you're talking about is really just shifted. It's not necessarily that we're a giant, we're SAP or we're Oracle, and we're going to create a commerce program and throw it over the fence and you're going to buy it and that's going to be fine. But rather that innovation you're talking about, I think, is happening more at the ground level because thanks to platforms like Spryker, like fabric, like Shopify, there's been a democratization of ability to be able to run these large-scale programs. And the footprint for these installations is a lot smaller than if you're going to put commerce cloud or something like that. And as a result, that innovation, I think, takes place day to day at the ground level, as opposed to at the high point. So we at Bounteous call it co-innovation where we work with partners. Partners work with us. Everybody is innovating at the same time. So I'd say there's just as much innovation. It just isn't a giant building that we can look at anymore. It's just little tiny improvements.

Brian: [00:09:37] Do you think there's a shift in like who's responsible for this now, too? Because I feel like you... I love this idea of co-innovation. I feel like merchants and brands weren't... In the old days, the way they were set up was to do that like big monolith type innovation. Is that responsibility getting spread out? I think we were in an era where sort of IT owned eComm capabilities and that's when we get those big purchases. And then the marketer kind of took over and now we're seeing things like CDOs or Chief eCommerce Officer. Where does this really belong? Is it the Chief Revenue Officer? Is it a single point or does it have to be spread out?

Jon Reilly: [00:10:19] I don't think it necessarily has to be spread out. There are tubes, of course, to very oversimplify it. So IT is always going to be involved. But the fact that you have these responsibilities for results being pushed to other places in the C-suite does not necessarily mean that the responsibility for the running of these is different. So the responsibility of the day-to-day still sits within IT. They still have a huge say in the conversation. But you have a Chief Digital Officer, a Chief Marketing Officer who has a different set of goals than the CTO or the CIO. And those come in conflict a fair amount where you're trying to do something cool, as it were, and the CMO wants to do all these things. And the IT is like, "No, we're not going to do that. I'll maybe get you on the calendar in 18 months." So how do you fix that? And so to your question of where it's going, you know, 120 years ago, every single company had a Chief Electricity Officer because electricity was new and exciting and nobody knew what to do with it. And by 1930, nobody had one. Because it just works. You just flip the switch and it's on. And we're not quite there with commerce. There's still more nuance to it, but we're getting there. And that democratization of platforms and being able to take those, they're not necessarily these giant installations that take years to build as they once were. I can set up a Shopify store on a computer under my desk, and a lot of product managers are doing that in these huge houses of brands: Procter Gamble, Unilever kind of thing. So I think we're just sort of at a cusp point if we were to put it on an age thing. You know, we're about 15 years old. We're in our late adolescence. We're starting to get a feel for what we want to be when we grow up. But mom and dad are still paying the bills, you know, that kind of thing. And I'd say that's where we are on the path.

Phillip: [00:12:01] There's something really interesting that I think that you can speak to that very few others can, which is a lot of that innovation investment in technology tends to happen and is led by an outside vendor who brings a capability into a legacy business. And so if you're an outside vendor and you have a preferred method of working, especially as an agency, a technology agency, you impose that style of work and that work mentality in the way that you build software or the way that you discover requirements, and that starts to become part of the way that an entire industry operates over a specific period of time. So from your perspective, and having been in that seat for a while, I'm curious what your viewpoint is on how much agencies have actually led how we perceive the way that commerce is built and how that might be changing today.

Jon Reilly: [00:13:02] Oh, well, so that's absolutely occurring. And I can say this from both sides of having sat on the client side of the table where I'm hiring agencies as well as working at agencies. So to your point, I have a somewhat unique view of that. You're 100% correct where the agency derives a little of that and imposes, imposes is probably too strong, brings their culture and their work style to the program. And part of the agency's job is to impact change at that organization. That's part of that's why they're there. That's their charge. But a large factor is the personality aspect of it. And that's why I use the co-innovation aspect. We talk about what we do as we work as partners with folks. And having worked at several other places over the course of my career, there's a large vendor mentality and it's that metaphor I used of you have a box, it says commerce on it, it's got a price tag on it says $1 million and you scan the barcode and say, "Thank you, please go on your way." And then you have some agencies who are, for all intents and purposes, one solution shops. They're all Salesforce, they're all Adobe. And as a result, those companies that hire those companies are going to be steered in a specific direction, making no judgment about that. But that is absolutely what occurs there and what I pontificate myself and one of the reasons why I use the center of excellence in my title is I want the best solution. I'm not picking anything specific. I want this solution for this specific program, or not program, as we're talking about today, to be the right thing. So that agnosticity, I think, is very important for a successful relationship.

Phillip: [00:14:39] So if that work style sort of is imposed on the client in this case, maybe like a retailer or merchant marketplace, where along the maturity curve do you start to realize we need to internalize some of these capabilities? These can't be external innovations anymore. They have to become internal capabilities. That becomes a huge culture shift. How do you manage through that?

Jon Reilly: [00:15:09] There's no set path to do that because no two are the same. But in a literal sense, it's we have to teach you how to fish. We can hand you a fish. We can show you what a fishing pole is. Ultimately, we want you to be self-sufficient and teach you how to do that. So to that point, while we're going through the program and honestly, this is well after requirements and after we're already in execution because things always come up, we can realize strengths and weaknesses by about any specific organization and we'll pivot to allow for that. I mean, that's just business and that's how we do business and everybody does business that way. The tricky part is that it's not our place to come in and say, you know, I'm not a therapist and I'm not going to come in and say, "Everything you're doing is your own fault and you need to do it differently." That's not going to be very successful over the long tail, but rather you use the therapist model. I'm going to sit there and say, "Why are you making the decisions you are today, and why are you doing these things?" And then we can get to the root of why have they been doing this either externally or internally themselves, and find the better way to do it. But to your meta point of it all comes back to the design and you have to ensure that the design is solid in order to make it work. And that's the iffy part about where we are right now is the downside of all of these tools being out there and ubiquitous and everybody can get them and they're somewhat available to virtually everybody is it's like everything's a nail and we're walking around with hammers trying to find where to use them. And a lot of times you'll have brands or companies who go off and make rash decisions. They go buy that red sports car when really a Toyota Corolla would have been just fine. And that's more of what I live into.

Brian: [00:16:54] I think that's a really apt...

Phillip: [00:16:55] {laughter} I'm having a midlife crisis. So I identify with that a lot.

Brian: [00:16:59] I think it's a great metaphor because I think...

Jon Reilly: [00:17:00] And I'll just add to that metaphor and you're going to see... I'm sorry. Please go ahead.

Brian: [00:17:05] No, no, no. Go ahead. Keep going. I like this. I'll wrap it around.

Jon Reilly: [00:17:11] So to continue with that, we also have to look at macroeconomic forces and we're about to enter a recession. And traditionally companies under stress, especially retail ones that deal with individual sales for dollars, will make rapid decisions in rapidly shifting times. And that's where you get a lot of red sports cars in the driveway because they start making these, "Oh, we got to do this, we've got to do this, we have to do something," and you'll see a lot of that. So in the next 18 months, 36 months, however long this recession lasts, you're going to see a lot of churn, which probably to my earlier point about age will probably set us back from 15 to 13 when all is said and done. But it's going to be interesting to see how that shakes out.

Brian: [00:17:54] Yeah, I think to add on to the nail metaphor, when you have a bunch of nails and you have a bunch of lumber sitting around, the danger of an iterative process is sometimes you don't think about how it all matches up in the end, and so you just start tacking on and tacking on and tacking on and you end up with a really weird looking house and maybe it ends up being cool or maybe it ends up being a monster or a non-functional house.

Jon Reilly: [00:18:25] Right. You never know.

Brian: [00:18:26] Yeah. And so what are some ways to help?

Phillip: [00:18:31] I love the layered metaphors. Let's keep going.

Brian: [00:18:33] Well, what are some ways to like when you're in a program situation to stay focused and have, dare I say it, a North Star to build towards something that's kind of an end goal? Or does that actually matter anymore? Maybe you don't even need that. Maybe it's just all iteration all the time and actually, the North Star is going to change so often. You can't even call it a North Star. You might as well call it a South Star.

Jon Reilly: [00:19:02] Which might be in fact happening or polarity is shifting. So I think that comes back to the initial question of how do you move from program to it just being part of your DNA. And in a lot of cases, it still needs to be a program, but in some cases, it becomes like a bridge and you start painting one end of it. By the time you get to the other end, the first end needs to be repainted again. And in a way, the explosion of the agile methodology in the previous decade made it possible for a lot of companies to be able to iterate in ways that they never did before because everything was waterfall and they might act like they were agile, they might even say they were agile, but ultimately they weren't. And without that mentality of sprint retrospective, sprint retrospective, sprint retrospective, we have a burned-down chart of all the things we want to do. If you just create this giant 500 page requirements document and say, "Okay, this is the thing we're going to do, it's going to take us 3.7 years to complete it. And when we're done, we'll dust off our hands." The three of us know from experience that program is going to be five years long. It's going to be 2x what the original budget is. And very few people who started that program will be working there when it's over. And that's just the cold, hard facts of it. I think a lot of especially large-scale companies have been burned enough by that over the past, not even in commerce, but just in general, that they're seeking out ways to be more agile with a small a, more nimble being able to do these programs that must be done in ways that it doesn't impact the entire enterprise, which is why smaller solutions, headless commerce, composable commerce, all these kinds of things make it more possible for those CMOs and CDOs to be able to convince their CIOs that these things must be done.

Phillip: [00:20:54] Let me jump in here because I have worked for and I've been part of a lot of organizations who have said many things over the years, like, "You've got to be customer-centric. Put the customer first. Think about the customer first. What is the customer want you to do? Let's work backward from that." And then they say, "What's your project methodology?" "A waterfall."

Jon Reilly: [00:21:16] Your customer does not want that.

Phillip: [00:21:18] And the reason being is because the most important thing is really for you to preserve your own capability to deliver. I mean, let's put all the factors aside like employee happiness. Let's put profits to the side for a minute. It's you need to ensure a positive outcome for your customer and business transformation and process transformation even for agencies of any size is really hard. Doing things differently than you used to do is really hard no matter what you do. So it kind of starts there on the services side of how do we get our retailer or our brand that we're working with to prioritize the customer and put the customer first if we can't do that and model the behavior ourselves first? I think that's where I feel like we've been hung up as an industry, especially in being so agency and services led for so long and we're being looked at as innovators. We have to innovate on our own model as well.

Jon Reilly: [00:22:36] Well, and you're absolutely correct, of course, but that comes into you have these monolithic agencies which have way more interest in these companies than just the commerce. And when what you're talking about right now is these huge programs, but they aren't necessarily the right programs at the right time. And one of the things that we run into in this business, and I'm sure you've seen this over the course of your careers as well, is there's always another master and over the course of, say, the last six or seven years, is commerce sort of pushed out AI as being the new sexy thing that everybody wants to talk about, but nobody really knows what it is. We as marketers within those agencies created an animal in terms of commerce that in a way can't be satisfied. We use terms like business transformation and digital transformation and all of these monolithic terms to be able to completely turn a business around when ultimately all they need is a website that they can do transactions on. And that doesn't necessarily mean that they don't meet digital transformation or need business transformation. But a large problem, I think, in terms of the expectations of how you're describing it, is how we in the industry itself describe these things that are taking place? And then next is you have a situation where a lot of times commerce projects are tied to other media projects. And that's the tricky part too. And those things, marketing, commerce, all these things go together. But you know, when you're doing a $1 billion media deal and an $80 million Commerce deal, it's pretty easy for the commerce deal to suffer. And that is a problem that occurs a fair amount. And maybe we're not getting the best we possibly could if we just focused on doing this job as opposed to doing this huge transformation or business transformation. But yet we're really only focusing on one really narrow part of it. We're calling it business transformation, but all we're talking about is eCommerce and there's a lot more to that. And we've both seen, of course, many times commerce pursuits fail because businesses don't change how they do business.

Phillip: [00:24:49] That's right.

Jon Reilly: [00:24:49] There is no organizational change management. There are no people responsible for different things in different ways. And what we're talking about at the top of the show, where we're talking about IT and what their place is in all of this. IT is still rooted in the aughts. It is 2005 in most IT businesses, and they like it that way just fine. And the rest of us are trying to move off to the future, but they hold the keys to the kingdom in a lot of cases. So there's that strife there. So I think that's probably why a large part of that digital transformation comes because then you're coming at it from the board down as opposed to the need up, and maybe that pushes it through, but it makes it difficult to achieve a moonshot when all you're trying to do is drive across the street.

Brian: [00:26:20] Organizations need to take ownership of this. I think a lot of the words you just mentioned often come when no one's really taking true ownership of the situation, like "Oh, we're going to put up a website." this is an actual thing that we're going to do. Business transformation is squishy and it allows ownership to be spread out. And so I think, I've been watching a lot of Alone lately. I don't know if you've watched the series Alone. I've been watching Alone Season 8.

Jon Reilly: [00:26:56] I'm familiar. Yeah.

Brian: [00:26:57] And there's like this sort of element of every brand is on their own. They have to take ownership for what they're doing, and if they don't, they're not going to make it. They're going to starve in the wilderness. And actually, all of the agile stuff we just talked about plays really well in the concept of survival as well, like getting too focused on one thing, like putting all your eggs in one basket, not having the big picture in mind, and not having like a strong enough mindset around it. So maybe that's a little bit extreme. I don't actually think organizations are alone, but you know, as we are looking at moving commerce to headless in the cloud, how can merchants actually take ownership of that? Because I think there's a lot of organizations that just want to like that sounds like such a belong concept to them that they are just like out. They just want to push it off on someone else.

Jon Reilly: [00:28:04] For sure. So to answer the question that is, of course, not easy, but the new digital transformation or business transformation is marketplace. And marketplace has now moved to what used to take the place of a website. And now everybody wants marketplace. But ultimately, nine times out of ten, you don't need a marketplace. And 48 times out of 50, your organization is not set up for a marketplace. And I won't use specific names in this, but as an example, however, I am familiar with a company that spent well into 11 figures on a marketplace, and it didn't last four years because they didn't change how they did business and that ultimate transformation needed to take place. But it was in a place that nobody was thinking about. Everybody was thinking about platforms and commerce. Nobody was thinking about how we purchase these things. What does it look like when we're in kind of a way, we're competing with ourselves within the same space? So now we've opened up yet another can of worms. And we're also, once again, as an industry, hyping something which makes it very difficult for us and our customers to succeed in terms of expectations. And this is a self-indictment on myself and everybody in my business that we need to temper down the rhetoric of digital transformation and all of these really big, fancy words. And just, you know, I used to tell my teams at Amazon, at the end of the day, your job is to sell stuff and for money. You exchange things for money. That's what we do here. And we get away from that sometimes, I think, and get lost and all of these programs.

Phillip: [00:29:57] I'm so on board with this line of conversation. I want to shift to one aspect, which is we talk about commerce and there tends to be this idea that a commerce platform is a thing. What I'm witnessing over the last few years is that, well, there is such a thing as a customer experience piece of that which has some level of engagement that a customer can browse and shop and express their intent to purchase. There is a plurality of software that makes all of that actually happen. So it's not one platform. It's actually dozens of platforms. It's order management, it's inventory management, it's warehouse platforms. It's for logistics, it's customer lifecycle marketing. It's messaging and push notifications. It's delivery tracking. And the list goes on. So it's a plurality of software and that requires not just ecosystems or monoliths, but I believe seasoned veterans who have made a lot of mistakes or seen a lot of mistakes made and know how not to repeat them. And I tend to believe that one of the challenges that I'm seeing right now is that there's an old guard who has seen a lot and gone through a lot of which I might be one. And there's a new guard who wants to sort of dismiss the people who actually made all this legacy software to begin with and try to throw it away and start over. How do we live in that moment where the industry is just old enough to where we can learn from mistakes and sort of treasure a knowledge base of folks in an industry who have been there to see all of this before? And how do we prevent ourselves from being doomed to repeat it?

Jon Reilly: [00:31:53] You could remove the word commerce and add something else in, and we'd all have that same question in our lives.

Phillip: [00:32:01] It's human nature. It's unsolvable. Next question.

Jon Reilly: [00:32:03] Yeah, exactly right. I have some thoughts on the topic, but just to be fair. You're right, using the model again of the box on the shelf, there is no box on the shelf anymore. But they're trying and you have the big brands gobbling up small brands left and right to try and become that soup to nuts experience where I can have commerce and just buy it and I'm done. But it doesn't exist today. And no two brands have the same legacy setup. And everybody has technical debt. Technical debt is just as common as regular debt. But that experience that you're talking about of the old guard, that's a very polite way to put that, by the way, and the next generation, also nice way to put that, that's just human nature. And we're rewriting the rules of this thing every day right now. I mean, everything. There's no set way to do this. We're defining the way to do this. And I would hypothesize that 75... I'm completely pulling a number out of the air here. 75% of businesses that require this have already done it once, and many of them probably failed and didn't go back. And those people are left on the side of the road. And one of the things that I've noticed now is we're having really far out channels start to come and seek out answers like this. And we started to see it with B2B in the latter part of the previous decade where that sector woke up and went, "Oh my gosh, we need to start doing this." You're starting to see it with smaller, you know, like doctor's offices and dentists and health management systems and things of health care, whatnot. But one of the things I literally just said today is every single piece of disruption that takes place in a sector, the following sector, the disruption happens twice as fast. I'm going to coin that is Reily's law. So everything that comes along, the next disruption is going to happen even quicker. So how do we manage that? And I'm answering your question with the question to say, I don't know, how do we manage that other than to say this is not a set it and forget it kind of thing? And that comes back to the very first question of the podcast, which is how do we move from a program mentality to a business-as-usual mentality? And the answer is the reason we have to do that is because if we don't, we're constantly reinventing the wheel, constantly rebuilding ourselves. And sure, you know, every five or ten years, maybe 20, I don't know, you replace the wiring in you're building, but other than that, you're not thinking about it because it just works. And so to me, the indictment is on us, for one, competing, not creating things that just work, and two, for not being better at implementing those things with a future state in mind. So that same stumble that we've had with companies where we get in with IT and the IT guys are like, "No, no, you're not touching my PIM. My PIM is running just fine. Nobody's touching my OMS. It's everything." In a way, they're right because they've spent all that time getting all that right. They don't want somebody like me coming around and screwing it up so they can sell more down jackets. So I can see both sides of it, but I don't know what the answer is. And it's going to be interesting to see over the course of the next five, probably 3 to 5 years, how that happens. And then add in the looming threat of the fact that 3 million new consumers are matriculating into the market every year thanks to Generation Z who is going to be the largest generation in like two or three years once the baby boomers make their exit. And they have radically different ideas of how things are supposed to be done. I still have brands scratching their heads trying to figure out how to figure out millennials and millennials have back pain and mortgage payments. We don't need to worry about millennials. We need to be worried about Gen Zers who are coming into the market because we don't know what to have. They want at all.

Phillip: [00:35:54] It's true.

Jon Reilly: [00:35:54] And I'm not even going to start with Generation Alpha, and Generation Alpha is going to be here even quicker than we want too. So there are a lot of things going on right now. And so within my own organization, I'm just putting on the hat of every single company I consult with, I'm a part of that. I work there now. And I wish more SIs and more agencies would look at it from that perspective as opposed to, "I got a commerce engagement at this and I can't wait till I'm finished."

Phillip: [00:36:23] Brian, I want to give you an opportunity to weigh in here. I feel like you've got thoughts.

Brian: [00:36:28] Yeah, I'm just thinking about things in the context of headless. I feel like the things that you're saying, Jon, are really they're the why behind this headless movement. Because I think you nailed it. The systems that we build have to be able to flex in the future. So we do build systems that work and we want to cling on to them when they do work. But I think the opportunity here is when it is time to replace the system, and we all will know when it's time. At some point that PIM will become so dated that it's just causing all kinds of other problems throughout the organization. And it does need to be replaced. When we replace it, we replace it with something that is open, open and ready for change. And I think that's one of the things that this sort of filters... Like this conversation about programs, one of the remedies or one of the ways to get there is to make sure you're building on technology that you can run a program on that is flexible enough to make a flex in and out of. And yeah, you can maybe you do pound a wrong board on to your monstrosity of a house, but you can pop it out and put the right one in, in the right place once you recognize that it's wrong. So yeah, the opportunity to experiment and flex and change as things are moving faster and faster.

Jon Reilly: [00:38:12] Yeah. So two comments about that. One, the danger of that, and I find this frequently is that, to use your house metaphor, we're talking about paint when we still haven't finished the foundation. And I think that's an important distinction. When we're looking at these as long terms, we're going to do this forever as opposed to we're building a house because we're thinking about putting up a structure and then walking away and not how people are actually going to use it. But that's an important conversation. But there's a certain point where that topic comes up in the timeline of the commerce program or commerce experience. And frequently I find that gets peppered in a lot early when it doesn't need to be there. And then second, you mentioned cloud, and I neglected to comment on that earlier. In a way, my view of the cloud is obviously you have the joke of it, you're just using somebody else's computer. But in that snark is truth. And that gives me as a business this flexibility, which I may never have had before. I never need to worry about uptime again. I don't have to worry about space. I don't need to worry about scaling because I know that AWS or whoever else I'm working with has the ability to do that for me. So in a manner of speaking, that gives me this enormous canvas as a business to be able to do things that I wouldn't necessarily do otherwise. Unfortunately, with that kind of thing also comes scope creep. And then you get into situations where customers are talking about, "Oh, well, we want augmented reality and these virtual things. You guys do helmets, right?" And you're like, "Oh my gosh, can we just sell something? Is that what we want to do here?" So you run into that and that's where you get into those tricky conversations between Chief Digital Officers and Chief Marketing Officers because those two people typically have radically different views of how to do things. But the cloud is a critical tool in our, all of our, and I'm using the industry, ability to be able to do things that we couldn't do ten years ago. And I was talking about those monolithic ATGs and high-risk type installations. We don't need to worry about that anymore because all of that processing power is done in some basement in Seattle somewhere, and it removes it off of my things to think about.

Phillip: [00:40:31] Let's shift into our final gear. And I'd love to bring this back around to something that we might have control over, which is, let's say that we have the right people, the right processes, and the right platforms in place to instigate all this change that we've talked about, change by any other name. How do we go about setting a course that we... How do we chart the course? How do we actually get to some sort of end state or decide that a particular direction with all of the tools that we now have is the right direction for our brand? Is that a factor of listening to the customer? Is that a factor of having an extreme ownership over a mission and a vision at the brand and the technology ownership level? How do you help your technology buyer that is one of your customers actually set them up for success so that they can be successful with all of these pieces they put into place?

Jon Reilly: [00:41:46] Well, right off the bat, it's just and you'd be amazed how often this happens is an agreement on what the end state is. And you use the term working backward earlier, of course, it's a tenant at Amazon. Everything is done that way. A lot of software companies follow that, but a lot of brands don't. And they start with a reaction to something that has occurred. And then their perceived response to that builds a program. And a similar way to look at this and I was having this conversation with someone earlier today is the struggle that all brands have with the amount of data that they produce, and they have these massive data lakes of information and they can mine through them and find all this cool information and run down all of these various rabbit holes. But rather what they should be doing is starting with a KPI in mind and working backward and finding the data to inform how to get there, as opposed to starting with the data and working forwards towards defining a KPI. And I'd say the same thing is true for what you're describing there of how does everybody get together on what we're doing here, why are we here? And that is that organizational buy-in that we're all in agreement of what we're trying to do and in the literal sense, contracts, and requirements, but I'm not necessarily talking about that. I'm talking about what is the problem that is to be solved here. What's the problem in the opportunity statement for us to be able to achieve what we're trying to achieve? And as an agency, as a services provider, as an advisor, once again using the therapist analogy, I can't help you unless you tell me what your end goal is. You've told me all your problems, but right now, sitting on this side of the table, the single unifying thing and all of your problems is you. But that's not necessarily always the answer. And then so if we look at the end goal of "I want to have X amount of sales to X amount of people by this date." Great. That's fantastic. Let's work backward from that as opposed to a reactive statement of, "Well, my competitor is doing X, so I need to do X." And that's sort of that organizational maturity that I talked about using a teenager methodology earlier. The chasm between being reactive, learning from things, and taking actions based on what you know and learning from things and predicting things and taking actions on what you think will happen is enormous. And very few brands are on the left side of that model there. And so hopping over that piece, that's the path to success and brands coming back to that innovation, they need to innovate in order to get there. And they need to take responsibility for their own innovation and not just hire a company like me to do it for them. We have to work together to be successful.

Phillip: [00:44:39] You have like honed in on something that I'm very passionate about, which is you can't define whether something was successful without having stated a goal. How do we have a goal? We have to define an end state. We have to have the vision, right? So a vision helps you set an appropriate goal, strategies align to those, and then we implement all the tactics that line up to the strategies, not the other way around. So let's revisit our initial question. I think this has been a really awesome conversation, but did we answer it? How can my brand move from having an eCommerce project mindset to a program mindset? Jon, do you think we answered it? And if not, what ground did we miss?

Jon Reilly: [00:45:26] I think we answered it, but I will digest it. For those who just want the too long didn't read aspect of it, of course, they should listen to you all the entire show and all 200 of other of them. However, the simple factor is everyone needs to agree with what the end state is. Everyone needs to define there's a goal. And that is the bedrock to having a long-term plan at any business on any topic. The CFO is not going to stand by while somebody comes in and say, "Well, we need to hit about $100 Million EBITA." They're going to be like, "Well, wait, wait, whoa, whoa, whoa, whoa."

Phillip: [00:46:03] Ah. That was amazing. You have a gift for this. You should start a podcast.

Jon Reilly: [00:46:08] You know, I've said that to my wife. She is in complete disagreement with you. {laughter}

Phillip: [00:46:13] It's been a pleasure. It's been a pleasure having you on. Thank you so much for spending time with us. Thank you for lending all of your thoughts and expertise to us. Thank you all for listening to this episode and watching this episode of Step by Step. As we continue on, we are trying to divine, we're trying to figure out how we invest in experience. And I feel like today we just discovered one more way for us to make the case to make that investment. Thank you so much.

Jon Reilly: [00:46:40] My pleasure. Thanks for having me. Methodology turns from something boring, like painting a bridge into something really cool, like innovating for the future.

Phillip: [00:46:52] Thank you so much for listening to this season of Step by Step. You can find more episodes of this podcast and all Future Commerce properties at FutureCommerce.fm. You can sign up too to get invited to any of our events that we have coming up. We have so many amazing events, everything from happy hours and get-togethers around conferences to our salons. You can get on the list, and you'll get our newsletter that comes out twice a week, The Senses, that's everything that you need to know about how brands and people intersect and how commerce happens. That's called The Senses, and it comes out twice a week. You can get that and more, including your invitation to all of our events at FutureCommerce.fm/Subscribe. Thank you so much for listening. Remember, the future of commerce is what you make of it. Commerce will shape the future and we can shape commerce.

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