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“That's the value proposition I try to make to the reader on this, which is practical coaching, and the goal is to help you and your company compete and win in the digital era.”
— John Rossman, Managing Partner at Rossman Partners and Best-Selling Author of “The Amazon Way”
John Rossman, Amazon veteran and managing partner at Rossman Partners, has spent years trying to teach ecommerce leaders “The Amazon Way.”
Now, he spends nearly every week putting out a newsletter focused on digital leadership and the practices, skills, and metrics brands need to win on the digital shelf.
Rossman joined a recent episode of the “Unpacking the Digital Shelf” podcast, “Top 5 Issues of the Digital Leader Newsletter,” to share the five key issues digital leaders need to focus on now to prepare their organizations for the future.
It’s safe to say the term “digital transformation” has jumped the shark. It’s become so overused in business that most people don’t truly understand what it means. The term is so all-encompassing that it feels nearly impossible to tackle.
“Digital transformation [is] a good term from a market definition, from a roll-up standpoint, from a category definition, but it's a horrible term if you're an actual company and you're trying to make change happen,” Rossman says.
According to Rossman, the main problem is that companies try to conceptualize change using the term digital transformation, but often they’re not clear on what outcomes they’re actually trying to achieve.
He says they can achieve clarity on this by focusing on the specific aspects of their business they’re trying to transform, such as improving employee productivity by 10% every year for the next five years or reducing customer churn by 20%.
Once the organization focuses on a specific endpoint, it can then strategize about which tools, capabilities, and organizational shifts are necessary to achieve this goal.
“That's where the strategy really starts, and that's what needs to happen in digital transformation, is clarity in mission. That's step one,” Rossman says.
Once digital leadership teams get everyone within their organization aligned on a measurable goal, the next step is to rationalize and pressure test their idea.
Rossman says it's important for organizations to view their transformation not as a single idea, but as a portfolio of ideas.
“All types of good things — good thinking, good choices, and good decisions — happen when we actually have a portfolio to review versus one idea,” he says. “Part of the rationalization is actually evaluating these as a portfolio, and the type of portfolio I like is typically around potential benefit versus potential risk.”
Rossman says to succeed, companies often need a mix of predictable ideas with low risk and low benefits — and big ideas with high risks, but also big rewards.
“Oftentimes, companies want to start with more controllable, better, predictable outcomes. That's great. As we grow in confidence in how we operate in this manner, then we'll advance into some higher risk, higher reward benefit,” Rossman says.
According to Rossman, the key to successfully executing high-risk, high-reward ideas is to start small, but be agile enough to fail fast and adapt by using what you’ve learned.
“Management is really about knowing the right things to do. Leadership is about building the will and the habit — and bringing others along to do the right thing. And so that's why I think both are critical, and we tend to lump them together, but they're actually distinct practices.” — John Rossman, Managing Partner at Rossman Partners and Best-Selling Author of “The Amazon Way”
Effective change management requires effective digital leadership.
In his newsletter, Rossman references Peter Drucker's “The Effective Executive” to formulate a framework around how executives can successfully execute change management.
In his book, Drucker lays out eight practices effective executives follow:
Along with these best practices, Rossman says it's important for ecommerce leaders to understand the critical distinction between management and leadership as they usher their organizations through change.
Friction often creates operational bottlenecks and hinders customer engagement and innovation.
“Friction is all the things that we ask a customer, or partner, or an employee to do because we haven't perfected our product or our service yet,” Rossman says. “It's all the data duplication, the questions you'd have, the comments, the customer calls you might have, the things that don't work, and the things that you describe as kind of clunky or slow that you go like, ‘Really? We're still operating like this’?"
Friction is dangerous because of the inertia it creates, especially at big companies. Rossman says companies both big and small can overcome friction by listening to their customers and trying to understand their points of frustration.
“The best place to look and listen to this is in what your field sales [team] says and what your customer contact centers say. Why aren't you winning deals? How do your competitors compete against you? It's all of those little things that add up,” Rossman says.
Addressing friction can deliver several benefits for brands, he adds. It will improve their customer experience, lead to operational improvements, and help companies build a “habit of being more connected, [being] more customer-centric, [and having] a finer eye for detail.”
Ultimately, reducing friction also will open up the time, resources, and creative capacity for brands to test bigger, higher-risk ideas that actually drive innovation.
To achieve operational excellence, Rossman has pretty simple, albeit difficult-to-follow advice: Be a perfectionist.
Rossman says his advice is less about achieving true perfectionism and more about organizations setting high standards relative to the tasks and initiatives that impact their customer experience and ability to scale.
To eliminate complexity in their business, companies must pay close attention to the details. Rossman also says it’s vital for brands to set high standards and be detail-oriented when they’re innovating.
“Being just as good as the competition typically is not a recipe for really gaining new market share. You have to have an eye to the details of the value proposition and the single superpower that is going to differentiate your new product or your new service,” he says. “Having high standards for teams and individuals — that details matter in every type of business and that people should understand the details of business — personally, I think that is a winning attitude and a winning expectation for teams.”
For more information on the five issues that greatly impact digital leadership, check out the rest of this episode of "Unpacking the Digital Shelf."
