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What Can Retailers Learn From Hackathons?

Over the weekend of the 25th - 27th of November I took part in the Melbourne RetailTech Hackathon, as a judge, on behalf of Thoughtworks. This event was organised by York Butter Factory with the help of student volunteers and is an extension of the monthly RetailTech Melbourne Meetup they run. It was run as a time-limited activity, restricted to 54 hours. This event was part of the Startup Weekend, a global event which attracts 15,000 budding entrepreneurs across 200 events.

The Melbourne RetailTech event had seven teams of between four and eight team members. The teams were tasked with coming up with novel and interesting ideas in any part of the retail value chain, and the outcomes were quite novel. Some teams chose to solve operational issues that retailers would face, and others came up with new retail concepts. To close the weekend, the teams were given 5 minutes to present their work to the judging panel, followed by answering questions from the judges for a further 3 minutes. Each team was assessed across three different criteria, the articulation and strength of their business model, the customer validation techniques used and how they interpreted collected data, and finally the teams were evaluated on the quality of their design and the execution of their solution.

There ideas presented were:
  • Virtual Retaility: A way of bringing virtual reality to customers to allow them to remotely navigate physical stores to view information on products and services
  • LoyalT: A self-service geo-local application for gamifying customer loyalty
  • Alcotap: An alcohol delivery service enabling local bottle shops to reach their customers in a faster, more personalised way
  • Homely: A two-sided marketplace for home cooks to share their personal cultural cuisines with hungry customers in their area
  • RingAround: A shift sharing concept to assist retail stores and their employees swap and fill shifts
  • Hey Buds: Simple, fast, flowers on demand, from your mobile
  • ReplenPro: A mobile solution to simplify moving stock from the storeroom to the selling floor based on real-time sales

After grading all of the candidates, Heybuds, RingAround, and ReplenPro came 1st, 2nd, and 3rd respectively. Their presentations were polished, they had spoken to retail stores and customers during the weekend to validate their ideas, they had created functional prototypes, and they answered our questions with confidence. The other teams were also impressive, with some unique ideas and approaches to new markets and issues that retailers and consumers have had for quite some time.

Established retailers could learn quite a bit from the hackathon process. Time is compressed, excitement is high, and teams of blended capabilities are put together to work on a distinct business problem or idea. Seeing such passion and enthusiasm amongst the hackathon teams led me to ask myself why, with such prolific supply of keen technologists, are companies dragging their feet when it comes to innovation. Retailers, in Australia particularly, can adopt a 'fast-follower' approach when establishing their strategy and roadmaps, looking to overseas companies or digital-only businesses to lead the charge and come up with new ideas, new markets, and new solutions. I think the answer to why companies behave in this way lies in risk avoidance and getting too comfortable with our past successes. Us humans are a funny bunch, we are often unhappy with what we have and forever wanting what we don't have. When we are told that to achieve the next level of success we would have to risk our current perceived position we will suddenly come up with a myriad of reasons why our status quo will do. I was recently informed that there were at least 11 types of risk, from financial and compliance risk to brand and reputation risk. I am sure an actuary could come up with more than 11 risks if they wanted to.

So what are we doing wrong? How do we look at all of these risks, and taking them into consideration challenge ourselves to create new ideas and test them out with customers? How can we create innovative environments in our businesses? One of the most powerful learnings from the hackathon was that the teams were expected to come up with the outcome themselves, however, if they needed, there were coaches and mentors to guide them through their problems. This structure meant that the teams weren't constrained in their ideation, by leaders who would delegate their ideas, and this enabled them to take on problems that established retailers and their service partners haven't yet tried to fix. Were their business models perfect? No, but with a little tweaking and advice the ideas could definitely be brought to life, and probably quite cheaply. Another assumption the teams didn't make was that they would be sufficiently funded. This means that the solutions that they came up with were quite lightweight, with limited need for integration, and could be created with a small team in a short amount of time.

This approach doesn't only work in small businesses. Some of the biggest retailers in the world operate by providing coaching and advice to teams that are expected to produce results. This model is sometimes called the "servant leader" approach. Walmart is one example of a company whose culture encourages this kind of leadership, and the results they have experienced are phenomenal, growing their revenue by $134bn dollars in the last nine years. That is not a typo. Sam Walton's vision of servant leadership brings results. The principles behind the Agile Manifesto also echoes this advice, "Build projects around motivated individuals. Give them the environment and support they need, and trust them to get the job done". Easy in principle, more difficult in practice, especially when ego and prior assumptions get involved.

This was my first hackathon. I felt privileged to have been involved and to provide mentoring and advice, and I thoroughly enjoyed the process, the camaraderie, and seeing the excitement generated by sheer determination and hard work. If you haven't been I suggest you jump on the internet and search for something in your area or industry, take part in a team or assist by providing some advice based on your experience. You won't regret the time spent and may learn a thing or two along the way like I did.

Disclaimer: The statements and opinions expressed in this article are those of the author(s) and do not necessarily reflect the positions of Thoughtworks.

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