HALF MOON BAY, Calif. – Brick-and-mortar retailers have struggled to change their corporate culture even as they’re swept along by the ecommerce tidal wave. That’s one lesson Gap Inc. CIO Paul Chapman has learned as he and the rest of the apparel conglomerate’s C-suite try to adopt a culture that prizes fast decision-making and agility.
“I love my company dearly… but [Gap] is so slow to decision-making,” Chapman said at the Forbes CIO Summit here this week. “I see this even to this day when we can make a decision very quickly but instead it becomes sort of a group think.”
Chapman, who commands a staff of 800 for a global company that operates more than 3,700 stores -- including its flagship Gap and Banana Republic and Old Navy brands -- says the accelerated pace of technology and ubiquitous competition mean Gap teams can longer afford to tarry long on IT product and services. Accordingly, Chapman is overhauling Gap’s IT operating model to accelerate product and service delivery for the company.
Traditional retailers are rushing to bolster their digital strategies, even as they shutter stores and lay off staff amid sales declines. And as many retailers stumble from one technology experiment (for example, beacons) to the next, Amazon.com and its long-tail of confederates and competitors continue to gobble retail sales through digital channels, including computers, mobile phones and, increasingly, voice-based assistants.
Lose the Lewis and Clark act
Owing to the organizational matrix of its disparate brands, Gap has historically been resistant to or unable to change, which is deadly at a time when Amazon.com practices high velocity decision-making, including a willingness to "disagree and commit" on initiatives lacking a consensus.
Chapman is emphasizing speedy ideation over deliberation. When a member of Chapman’s staff of 800 asks him to “explore an idea” he encourages “time-boxing,” granting staffers permission to take 48 hours to reach a decision. He says this approach quickens the pace of decision-making by dissuading the staffer from disappearing on a Lewis and Clark-like expedition for six months before deciding if it will work.
Prioritizing speed over deliberation is just one characteristic theme of a sweeping IT overhaul Chapman began in 2013 when he was promoted to CIO. He has since collapsed Gap’s ecommerce IT with its corporate IT into a single unit known as Gap Tech, which is clustered by domain expertise, including customer experience, supply chain, inventory management, business intelligence and cybersecurity. Each domain, which includes former consultants, leverages DevOps to quicken software development, collaborating freely with various business units to deliver IT services. He says its resonating with Gap’s business leaders.
"When I put that model in place two years ago almost overnight my organization got out of the order-taking business and became a true partner around the table with our top business leaders as well," Chapman says.
Running on a LARC
Perhaps the boldest change has been Chapman’s staunch refusal to embrace the traditional RACI (Responsible, Accountable, Consulted, Informed) model for IT management, in which only one person or organization is accountable for IT service delivery. In a departure to that siloed model, Chapman created LARC (Leading, Accountability, Responsible, Contribute), a hybrid model in which IT staff take on multiple responsibilities and several contributors provide input to foster an idea or solution.
It's ostensibly a more collaborative model -- though Chapman ensures that his teams follows the business process. Chapman says that while newer hires have little issues following LARC, long-time employees accustomed to the RACI matrix sometimes struggle to understand who is making the technology decisions.
Organizational matrix and decision-making challenges aside, Chapman Gap's greatest challenge is less about ecommerce and more about shifts in consumer behavior. As in, people want their clothes to fit perfectly, look great and they want it now. Yet Chapman gave Amazon.com, the chief architect of this instant gratification movement, the Voldemort treatment.
Although Chapman spent 40 minutes speaking on stage he did not name the online retailer once, even as he alluded to the existential threat it poses to traditional retail. “[Consumers] know they can get what they want in a short period of time and so they are very unforgiving when traditional brick-and-mortar retailers cannot deliver,” says Chapman.
To address this challenge, Gap is trying to create channel-less commerce (okay, it’s the new omnichannel), in which it provides consumers the products they want regardless of whether they buy in-store or online.
But in the near future Chapman says that Gap will lean on predictive analytics to anticipate customer intent and align it with inventory planning and management, efforts Chapman describes as the “Holy Grail” for retailers.