Dixons CarphoneDixons Carphone - Record breaking Black Friday
Dixons Carphone (Dixons) is a multinational electrical and telecommunications retailer and services company headquartered in London. It was formed on 7 August 2014 by the merger of Dixons Retail and Carphone Warehouse Group. Dixons Carphone currently has over 3,000 stores in the UK, and operates an e-commerce platform that annually delivers over £1bn in sales. The 250-strong e-Commerce department of Dixons is driven from the UK with development based in Brno in the Czech Republic.
For all retailers, the most important days of the year are Black Friday and Boxing Day. Following the qualified success of the online platforms in 2014, the Multichannel Director at Dixons, Jeremy Fennell, recognised the opportunity that Black Friday was presenting and wanted to make it a strategic focus for the organisation. However, he was frustrated by the inability of the e-commerce department to capitalise fully on the opportunity.
In previous years, the organisation had experienced problems with delivery: timescales were compressed due to extended periods of requirements definition, low-value change was given inappropriately high priority, and the resulting deliverables were not tested to a sufficiently high standard. There was never enough time to meet the demands of the commercial team.
In a tight-margin industry and complex environment, simply throwing more resources at the challenge was not an option.
Jeremy, working with the Head of Applications for Dixons Carphone, Jake Hazeldine, sought help in addressing the challenges. He knew the issues in delivery were not confined to the IT teams alone so he sought out a consulting partner who would understand IT delivery but also the wider business, the commercial goals and how the whole end-to-end process of delivering customer-facing solutions worked across the organisation.
Objectives and Approach
Dixons’ ultimate objective was to maximise sales on Black Friday through the optimisation of the e-commerce platform. This required the delivery of a wide-ranging portfolio of technology change and a new delivery processes to support and drive close collaboration between the commercial and delivery teams to ensure that full value was achieved from each change.
IndigoBlue was initially engaged to undertake a review of the e-Commerce department. We were selected by Dixons for our recognised industry-leading expertise in Agile delivery (the delivery capability in the Czech Republic is Agile) allied to our broader capability in understanding upstream and downstream activity.
The findings highlighted what was working and what wasn’t in the delivery machinery. The major overarching issue was that although Dixons had established an offshore Agile delivery capability, the organisation itself was not Agile. This was causing misalignment at the interfaces, leading to widespread frustration and a breakdown in communication and collaboration.
The key components of the recommendations that followed were that Dixons needed to:
- optimise collaboration between the commercial team and IT to ensure that the right people were involved in the decision-making process at the appropriate time
- orchestrate work better to drive flow; this primarily focused on the need to break requirements into smaller, incremental deliverables
- manage the portfolio better to focus on delivery of high business value and to provide space for proper testing and other quality controls
- improve the day-to-day processes and skills of both the onshore and offshore teams
- optimise the organisation to support Agile delivery capability
- improve the governance processes and their effectiveness in supporting Agile delivery
Following a detailed five-week review encompassing the UK and Czech Republic, the planned one-hour reporting workshop ran for five hours because the executive management team was determined to understand the nuances of our recommendations, and to engage with and challenge our understanding. This was a critical step in gaining trust and sponsorship for our proposed changes.
The Change and Delivery Process
Following the acceptance of the recommendations, IndigoBlue was engaged to implement the proposed changes. For an initial six months, we provided a small team which provided leadership, transformation coaching and resource augmentation. The team comprised a Transformation Lead (who also managed the portfolio), two senior BAs, two project managers and an Agile coach.
The IndigoBlue team’s role was to be advisor, coach and challenger, supporting the client through the transformation. We integrated within e-Commerce to find better ways of managing the portfolio, orchestrating requirements and optimising the delivery process:
- The requirements management process was made more collaborative and involved conversations between the commercial, user experience, technical and delivery teams about the best way to approach those requirements in order for delivery to be achievable in the timeframes available. Our success in this matter depended on bringing together the IT teams and the business teams to work towards the necessary change.
The new approach covered the full end-to-end process from inception through to delivery, and required further adaptation to other working practices (as described below).Importantly, these processes allowed detail to be added progressively rather than resolved at the outset. This reduced cycle times and created a context that encouraged regular collaboration.
- The IndigoBlue lead worked as interim Portfolio Manager, collaborating with the commercial team and IT to prioritise and throttle the portfolio, and to ensure the amount of work flowing through delivery was well managed and not ‘overfed’. Previously, the tendency had been to pack the portfolio and leave little space for improvement or overrun. Contingency ‘gaps’ were added to improve quality but counterintuitively this also increased speed of delivery by increasing focus.
- In optimising upstream activity, there were challenges in getting people to think incrementally. This is common to many organisations where individuals attempt to achieve a full and comprehensive solution ‘first time’, and overburden the process with excessive up-front analysis.
Our Business Analyst consultants used approaches ranging from coaching, cajoling and supporting people in their change journey to introducing more practical changes to governance and Solution Value Mapping. All were important parts of the move to a new way of thinking and operating with a focus on delivering value.
We introduced lightweight but more effective governance structures designed to support an e-commerce project, leading from the front to set a standard the Dixons teams could then emulate. The key change here was enabling governance gates to be passed whilst uncertainty still remained. This supported the incremental approach and the progressive addition of detail.
- Daily, weekly and monthly meetings were set up, with the right people being brought in at the right time and being given the right information to make decisions and oversee progress. Prior to this, it was often the case that the commercial team would make IT design decisions without IT, and the IT team would make commercial decisions without the input of the commercial team.
- The largest challenge we faced at Dixons was to introduce a fundamentally different way for the organisation to think about delivery. Dixons was focused on output rather than value. It required a lot of discipline from the teams and an intense focus on value in order to address this issue. Key to success was the incremental delivery of features (and value) with rigorous measurement.
- We introduced a new process for relative estimation and contingency planning to provide predictability and get the right people doing the right job, consistently. It was a very visual and very collaborative approach and this was very different from the way Dixons had worked before.
- Although relatively minor within the overall change, an Agile coach was also despatched to work with the offshore delivery teams to optimise the day-to-day process and ensure the appropriate application of Agile techniques (e.g. stand-up meetings, retrospectives, backlog management and reporting). This achieved produced productivity gains in the region of 20%.
IndigoBlue engaged with all levels of the organisation. We had a mandate that was supported by the Multichannel Director and co-sponsored by Jake Hazeldine, the Head of Applications. The coaching engaged with the delivery teams and business stakeholder groups and we were able to act on and influence all the necessary parts of the organisation.
We used an embedded coaching team which operated at project level with the delivery and stakeholder teams. We sought to break down silos, enable IT’s voice to be heard, grow the Agile skills of the e-Commerce team, increase collaboration and facilitate better working with the offshore team.
For example, the governance and funding approach had hindered progress in the past but, through effective communication and appropriate challenges, we enabled barriers to be broken down; as a result, those responsible for security compliance joined in and supported the change effort. The business’s confidence grew and a new perception of IT started to emerge and take roots: as a partner, rather than an internal supplier.
The collaborative relationship between Dixons and IndigoBlue was highly effective. Trust was built rapidly with the executive team from the start and strong relationships were built with the delivery and business stakeholder groups through close coaching. As a result, we were given authority and our expertise was leveraged to the client’s benefit, providing guidance and respectful challenge. Dixons kept the communications open, feeding back to us, sharing information and seeking our input.
The project was an unqualified success. Dixons broke all records for Black Friday in 2015, achieving in excess of £70m sales from over 6,000,000 unique visitors. This success was recognised through a number of headlines in the national press. For example, the Mirror’s headline was “Black Friday 2015: Currys break online record as Argos and Tesco websites struggle to cope with demand” see http://www.mirror.co.uk/news/uk-news/black-friday-2015-currys-6910402.
The Mirror also reported, “The electronics retailer [Currys PC World] today reported a 1100% increase in hourly unique visitors and a 2900% increase on orders compared to the same time last week.” And in the words of Jeremy Fennell, now Managing Director of Carphone Warehouse, “Working with IndigoBlue, we achieved more in six months than in the previous two years.”
Throughout Black Friday and Boxing Day, the e-commerce platform remained stable, performed well, and orders were processed successfully. Back office and front-end systems all withstood the massive increase in demand. Customers got their bargains, the business broke all records, stakeholders were delighted and Dixons Carphone reaped the PR and revenue benefits. The success of Black Friday infused the business, it felt good and there was an energy felt by all teams. The e-commerce IT team was recognised internally and lauded as the enabler of this great success. The investment had paid off. And the basis for continued high quality development, collaboration and governance was embedded. It was an unmitigated success.
Of equal importance to this success, the changes have been sustained by Dixons. Throughout 2016, the e-commerce team has continued to achieve faster and higher quality delivery of requirements. The incremental approach has continued, with the new much greater focus on delivering early business value.