Reflections - "Rally the Troops"

A few years ago I was asked to take on a corporate wide initiative on Inventory Efficiency for Walmart Canada. At that time, there was pressure on the business to make a change, improve our inventory position and drive working capital. While I was disappointed to transition from my leadership role on the transportation team, I knew it was the right decision for the business.

The first few days in role were interesting to say the least. The company had conducted an offsite meeting with a third party to brainstorm the various ways in which we as an organization would improve our inventory position. I was handed this information a few weeks after the meeting and committed to a target derived by the executives at the time. The target met the qualifications for a SMART goal; it was Specific, Measurable, Achievable, Realistic and Timely. The challenge in all of it was the sheer size and scope of the initiative – we had to transform ways of working from one end of the company to the other, and fast. The Inventory Efficiency Program was born!

While daunting at the outset, managing large projects and initiatives was not new for me. During my tenure at Praxair, I ran their continuous improvement practice and led a team of dedicated Six Sigma Blackbelts and change agents. As I pulled the team together, we spent the first few weeks developing a project plan and trying to tackle the project steps we would undertake to drive results. By the end of the second month of the project, we had identified three main components of the program, defined key resources for each and developed a roadmap of how we would execute.

What happened in the coming weeks is a testament to the power of teamwork and what can happen when associates are driven and empowered to deliver results. Working with cross functional partners across the organization, we simultaneously implemented key ways of working and rules for how we ‘Planned’, ‘Flowed’ and ‘Exited’ product from the business. In addition, we leveraged top analytical resources to develop a clearly defined measurement system for what constituted productive and non-productive inventory in the business. All meetings in the company where inventory was discussed would now use this universally accepted measurement system to track performance and action plans. Where there had once been complexity and confusion surrounding our inventory position, we now had clarity like never before.

In the weeks that followed, there were varying rates of adoption and acceptance by the stakeholders as they moved through the change curve. We had fundamentally changed how success was measured for multiple associates in the business and not all had completely warmed up to the process. As the early adopters demonstrated that the new ways of working would improve their business, others followed suit. The executive team, while on board from the beginning, began to publicly celebrate and commend the associates for their efforts in improving inventory.

The culmination of our first six months of the Inventory Efficiency Program was a multi-week promotional event dubbed SWWOCE (Sell What We Own Clearance Event) that was executed in the normally sleepy summer months before back to school marketing took off. We leveraged the partnership forged between the different organizations in the company to allow merchants to promote their clearance merchandise in the flyer over a three-week period. Store operators were brought into the program to facilitate execution and select items relevant to their geography and clientele well in advance. We collected every clearance sign we could find and aligned store setup and promo layouts to delivery of the product, creating a friendly competition between stores on who could sell the most product. By the end of the three-week event, we had cleared tens of millions of dollars of inventory that would have otherwise been left to clog up our back rooms and distribution centres for years to come. That event, coupled with the Plan-Flow-Exit Rules and Ways of Working put into effect by the Inventory Efficiency Team and our cross functional partners would result in obtaining a world-class inventory result in just under two years.

I've managed several programs and initiatives over my career, even led entire continuous improvement teams and departments. This was by far my largest program undertaken to date, and the most rewarding in terms of the cross functional collaboration and results driven for the company. While there were several factors that led to our success, I would sum up our key success factors as follows:

Executive Engagement

While the team inherited the target and the desired outcome for the program from the offsite held before we were formally handed the initiative, the executive leadership at the time had the foresight to give us the leeway needed to drive success. Even though they were noticeably uneasy at times when we proposed changes to our measurement systems, processes and ways of working, they stuck with us and publicly drove the message hard about the need to succeed. When you are contemplating a large, cross functional initiative it is crucial to have the senior executives drive the program for you. If they are telling you they are supportive but downplaying it with others you may not be set up for success. In our case, we had complete alignment from post to post, helping us achieve even better results than we initially envisioned.

Standardized Measurement System

Depending on the inventory position in your company, the development of a measurement system to track productive and non-productive inventory could be more important than the executive engagement identified above. In large companies, it is easy for complexity and complacency to rule. The development of a clear, concise tool to show which areas of the business were failing to meet their targets drove a level of engagement and sense of urgency on inventory not seen before in the business. We faced challenges to the validity of the data and categorization early on, not uncommon for change initiatives that are driving a new way of working. Knowing we had built a measurement system that could be validated using Six Sigma tools, we stuck to our guns and changed behaviour through the entire business for the benefit of not only our shareholders, but also our customers.

Depending on the inventory position in your company, the development of a measurement system to track productive and non-productive inventory could be more important than executive engagement...

Be Persistent

Change is hard. Most corporate executives will tell you that getting a change initiative implemented can be compared to trying to turn a supertanker around. It takes precision, patience and persistence to get it done right. In our case, we developed the Plan-Flow-Exit rules and Ways of Working cross functionally, held town hall sessions to gather and implement feedback, then drove the change. The laggards on the change curve resisted change at first, but were converted to believers when the groundswell of support from early adopters began to yield massive improvement for their parts of business.

Takeaways

Throughout your career, you will be called on to rally the troops and drive a positive result for your organization. That may entail an initiative within your functional area, a corporate wide transformation or something in between. Whatever the case, you need to make sure you have the support, measurement systems and persistence to deliver. In my case, the success enjoyed and positive change created with the Inventory Efficiency Program gave me the both confidence in our organizational capability and a boost in passion to drive other transformational programs. What seemed like a steep uphill battle at the start of the program became a celebration of a new way of working that drove non-productive inventory levels to world-class status. On the heels of Inventory Efficiency we launched multiple groundbreaking initiatives that endure today (SORT - Store Operations Reclamation Transformation and SPARTAN - Standardize Pallets and Reduce Touches Across Network are two leading examples).

Remember, it is always possible to accomplish more as a team than you could ever do on your own. Rally your troops, drive executive engagement, standardize your measurement system, be persistent and watch the magic happen!

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Jim McKay has spent over twenty years working for and with companies of all sizes to help develop strategy, deliver programs and drive engagement.