Steffen Sandner is a CDO (Chief Digital Officer) at Marc O'Polo. In this episode we learn about the Digital Transformation project they're currently going through. What you own vs. what you buy is the most important question to ask when establishing the software architecture. Steffen helps us answer this question. He als gives us some hints on how to cooperate between tech and business stakeholders.
Piotr Karwatka: Well-established fashion retail business, 1600 employees in 40 countries. Multi-channel e-commerce already doing great numbers. Today, we're gonna discuss how Digital Transformation looks at this scale, and there is no better person to ask about this than Steffen Sandner.
Hello Steffen! It's really cool to have you here! Thanks for accepting my invitation!
Steffen Sandner: Thanks! Nice to be here too.
Piotr: You used to work at Marc O’ Polo, for about five years already. You started as a UX manager. Would you tell us a little bit more about your background?
Steffen: Yes. UX was just a start. After that I quickly took over the e-commerce Developers and UX Designers and gave them a voice within the company. One thing came to another and we quickly were able to grow the Developer Unit heavily, within the Digital Unit. Right now, we try to combine the best business concept persons with our Software Development, the Data Engineers, and just recently, we opened another big team where we combined data engineers with data analysts and data scientists. The alignment of goals from concept strengths to tech capabilities combined with their project management gives us speed and autonomy within the company.
Piotr Karwatka: I guess that we first met somewhere in autumn last year, and you were starting a new project at Marc O’ Polo. What is this project all about?
Steffen The simple way to describe it is: we will set our e-commerce architecture towards headless behind the scenes. We're building an e-commerce ecosystem that gives us the driver's seat for all future challenges. And e-commerce is just one of them.
Piotr: So the first question is why headless? What are the business values that headless architecture provides in your case, for your business?
Steffen: You need to know these processes that are running usually on a commercial platform. You only stage them once a night, then you have the cash needed to build up. We don't want that anymore. We want to have a product live when it's in stock immediately, or when it gets back into stock, and that's really important for us. We want to get rid of all these rhythms that we need to apply with traditional e-commerce software, and that's why we run for headless.
Piotr: So it gives you the opportunity to run the development process at like two different speeds right one from front and the second for backing?
Steffen: Obviously the goal is to reach the same speed but the front end needs to be quicker because it's consumer facing and we need to react to this.
Piotr: cool. So it sounds like you said something like the eCommerce is just our first step.
Is that true?
Steffen: The business models have become fluid during the last couple of years but still at the moment every sales channel has its own front-end and end ecosystem. That leads to less efficiency and that stock for example. In the future I'm pretty sure, like nearly every fashion company will face the same challenges. But in the future there will be one central order management for all directed consumer channels. Different frontlines, for different purposes, obviously um they should be built on the same stack. There needs to be a lot of intelligence in between. I'm pretty sure in your tech talk next week with Matthias, you will get even more details about the concrete tech setup. It would be stupid for me to provide you with all the tech details, that’s Matthias’ job right.
Piotr: Let's go back to the project. I guess it will somehow change the workflow for quite many different teams across the Marc O’ Polo company. So the question is: how do you introduce a change like this at this scale?
Steffen: It was quite a long process to convince the company. We're not there yet, but we already started with the project and we are trying it. We're trying to build it step by step. The partnership between the business concept and tech made the arguments clear for everybody we have within our own team. In the end everybody on the Board understood that this transformation will lead to an advantage and give us more flexibility in the future. My personal vision is to unify channels and also, within the organization, to gain process advantages, tech advantages, to have them on the same level. It's not only about technology, but the process will be a big leveler.
Piotr: I’m still wondering about, in an organization of this scale, you have thousands of people and as many ideas and initiatives which you need to prioritize somehow. How do you set the priorities at Marc O’ Polo?
Steffen: Absolutely true! From internship to C-level- everybody has an idea. We used to discuss these ideas once a month a couple of years ago and these talks took three to five hours a month. We really wasted a lot of time. Somehow, always the person with the loudest voice gets their ticket into development. So we decided to get rid of this and really be fact based. We have implemented a simple scoring system, which now has five attributes. The scores are: 1) revenue uplift, 2) savings, 3) target group value, 4) process impact and 5) tech value. The tech value contains something like: is it sustainable? Is it mobile? So we really have hard measured facts there, after designing the scores magic happens. And the tickets get the score. Developers just pick the most important one by their skill set and the prior discussion we just had yesterday took 15 minutes. Most of the companies already aligned on that and that really helps a lot in going into the same direction with the business. In the end you have more time to really get into the stuff. That is value driving and that's really important for us.
Piotr: I really like this idea with five attributes for making a decision. It’s very clear and I guess it is so clear and works so well uh because of the team. So my question is with whom do you work on a daily basis? Who reports to you? Who do you need to consult regarding the business decisions?
Steffen: within the team we have different roles. The digital business development obviously, which is the first partnership with getting ideas to track. We all know this idea of dropping stuff is always a problem and digital business development helps with that. Then we have a team called Software Development. And just recently like this week we launched the team Data Intelligence. We would really try to build data infrastructures and intelligent reports um they are just fixed and organic But within the projects and all the stuff that is happening, we need to partner fluidly like so the business developer is working with a front-end developer and the other way around. Whoever leads the project and we really try to establish these partnerships within the unit and also loop in abroad business units like e-commerce retail organizations, the classic IT teams, logistics, sales whatever you can think of. We try to really have them as partners here within the unit. And there also were some interesting things like during this covet pandemic we partnered with totally new units like HR or Communications to react really quickly to the changing environment you have at the moment. And to really provide the business with the needs or provide business with solutions for their needs. So you see the variety is high and again e-commerce is just one aspect.
Piotr: Awesome. I really like this interdisciplinary approach and involving the business stakeholders into the process. And clear criteria for making the decisions. But in our first episode Kelly Goetsch uh CPO of commercetools said that there is one more successful aspect of introducing microservices and in your case headless architecture, which is a project sponsor. So someone with a good gut feeling, and knowledge then supports a tough decision because there are a lot of tough decisions when you’re starting the new idea from inside the tech team. It’s not an easy task because I guess it requires you to convince the non-tech business stakeholders that this process is worth undertaking. A lot of our listeners are facing the same problems, so maybe you have some advice for them?
Steffen: I would say get the crowd heavy users first, and then build a story about the product. That takes time. And you should take your time. For me, top to bottom is not sustainable anymore. Everybody within the project team needs to fill this part in the important decisions. So afterwards there are no excuses and everybody wants to make it work on an operational site. Later on everybody is on board and wants to make the project a success. So it's really important to have them on board on the first stage. One sponsor for me is not enough but obviously in some organizations that helps politically right? Projects that are a team effort and not one-man shows in the end. Numbers count. Make everything data-driven, and even try to automate the decisions which led to a project. Really try to be data driven there and not do it out of purpose so a data driven approach means putting the activities and setting the goals uh putting the measurable KPIs on top of it.
Piotr: So the question is how do you set the KPIs for a project like this one?
Steffen: As mentioned the price score helps a lot with simple tasks that don't need a big investment. Classic change requests, like change the button color or switch to process on that stage or whatever like really simple ones in companies like ours. There's so much unleashed potential within the IT ecosystem that just needs to be tackled the right way. The right way means not only look at savings and revenue uplift, but try to measure your consumers. They are the most heavy price voice you can use and you can get. And that's what we tried here as well the heavy users. Also the consumers took place in our decision process.
Piotr: Okay so uh so you started the transformation with sub projects. The whole thing is not like a monolithic, single new thing but it contains some sub projects right?
Steffen: True um we've divided the project into eight separate chapters. Four of them are business driven. Four of them are clearly tech driven so the chapter leads where they have a technical coach/project manager or a business project manager on top. And that really bundles strings the chapters are fluid within the team setup so if we need a specialist in a certain area we include him in the discussions. But he needs to take over ownership. Obviously that's really important like I mentioned before. So far the setup is working pretty good especially because of the will of everybody involved. As I mentioned before, we first gained the will to really get this thing on the street. Now everybody is really heavily motivated.