Why Industry Resists Change…
“If you do what you’ve always done, you’ll get what you’ve always got….” So goes the mantra of start-ups the World over.
Of course, Big Business has a long-standing carefully crafted profitable model which largely relies on the status quo that they’ve painstakingly constructed over many years and this works very well, most of the time. Unless you’re Kodak.
There has never been a time of such opportunity for new, disruptive and fresh-thinking business and, equally, there’s never been an era laden with so many potential ‘Kodak moments’.
From the Retail industry to the aviation industry, it’s exactly the same. The established industry ‘tech’ relies heavily on hardware (or, at least, specialist handsets or equipment) as opposed to smartphones, and this proprietary hardware is often expensive and always restrictive.
Perhaps the most extreme example of this is aviation, where pilots seem to largely disregard their digital dashboard in favour of an always more up to date iphone app called Sky Demon. Helicopter pilots can set their destination, build their flight plan, calculate their helicopter’s weight, keep track of real-time weather conditions, monitor air speed, altitude etc, all from their phone. Even the most technical of aircraft hardware is dated before it even hits the production line, so apps transcend anything else due to their speedy dynamic updates. To put this in extreme perspective, the original Nasa Space Shuttle Columbia’s entire computer system is less powerful and sophisticated than a single iphone 4!
So, why do large organisations tend to resist change so vehemently?
Well, as far as I’m concerned it’s down to a number of key factors.
Firstly, it’s difficult to disrupt if you’re a huge corporate machine. It’s the equivalent of attempting a hand-brake turn in a Supertanker. Additionally, if you’ve created the very legacy that you’re now expected to disrupt, you’re going to resist that upheaval for as long as possible. What’s more, if you’d be providing something faster, simpler, easier, better and more affordable to your customers then you’d be in danger of cannibalizing your own marketplace.
So, this is why radical change is almost always pioneered by new, legacy-free companies and, if the innovative new up-starts manage to get some traction in the marketplace, it can become a thorn in the side of large institutions who don’t necessarily have the ability to ‘start again from scratch’ or even the express permission to do so from shareholders. And then, of course, there’s the leap-frog aspect – innovation almost always comes from a completely different perspective that’s not tempered or even influenced by what’s gone on before.
The clever institutions select concepts and companies they feel are most likely to succeed in their disruption and partner with them to their own advantage (the existence of Microsoft Ventures, Google Ventures and Unilever Ventures are all testimony to that fact). The less forward-thinking may try to duplicate these new companies and, for many reasons, almost always statistically fail to do so effectively.
There’s also been a huge investment in hardware and their related systems (for example, Self Checkout machines), over the last 20 years and they can still be sold at between £10k and £40k a piece, which is great business for the manufacturers, despite them being (in their current iteration) more of a frustration than a benefit. In fact, 48% of people actively avoid these machines and choose the lesser of two evils instead – the queue! In busy stores with small numbers of these machines they’re actually proven to cause queues!
There are a number of simple reasons for this but to highlight a couple, psychologically, shoppers are reluctant to unpack an entire basket and ‘risk’ scanning their entire shop themselves in one go (whereas, had they been scanning item by item as they shopped it’s actually an enhanced experience due to the useful running total, list management and ‘allergy alerts’ etc).
Secondly, there are often complications at the self checkout machine. Perhaps the most obvious one is what we’ve called ‘the croissant conundrum’ where you’re asked to place your weighted item on the scanner and then choose from an option of six thousand products over several screens on which your item never seems to be present! And what if you have a bag of bakery items – do you have to unpack them all individually, placing them on the (filthy) scanner, searching for each one individually? I can’t tell you how many people I’ve seen give up on that futile journey and dump the bakery items. In fact, I did it this morning!
Of course, it’s easy to con an SCO machine too and this results in significant shrinkage (claiming bacon is an onion for example!). This is something that our new ‘Loose Product’ feature completely eradicates!
In summary, it’s just not perceived to be in the best short-term interest of large hardware and POS manufacturers to disrupt their own lucrative equilibrium, so it’s our job to do it for them. If they don’t adapt fast though, they’re in danger of their own Kodak moment. In the medium term this disruption will, of course, benefit these companies and will help them to pivot and re-purpose their offering – for example, making their SCOs future-proof in conjunction with the Ubamarket app and simplifying their POS systems by giving their customers more control.
With the app now facilitating the in-store experience as well as click & collect and even home delivery options (all presented in a new, easy to use app-based omni-channel interface), it really is time to innovate, simplify and streamline the entire end-to-end experience. This is not, however, for the ‘stores of the future’ as often claimed. This is for the stores of today (aside from those who want to be perceived as the stores of yesterday!).
Will Broome January 2019