Is it really that basic?
At a time of record inflation, rising energy prices, war in Europe and a possible financial crisis behind the scenes, many organisations are holding back on major investment. With its store concept “Basalt”, Danish Salling Group has challenged the spirit of the times and is a good example of the business agility that everyone should strive for.
Salling Group's latest new store concept, “Basalt” (which means “Basic” in English) is a great example of the business agility that many Danish and international companies strive for, but still find difficult to achieve.
All companies dream of reducing "time-to-market," and moving faster from idea to earnings. That is increasingly attractive in a changing world, where it has become a competitive differentiator to be able to adapt quickly and react to how the outside world and customers' needs are constantly changing.
What characterises business agility?
Business agility is the ability to compete by being able to quickly respond to market changes and new opportunities with innovative business solutions. To achieve business agility, in particular, is about daring to take chances on opportunities that suddenly appear and learn from them on an ongoing basis.
In our work to introduce business agility to Danish organisations and companies, we have put together the following six pieces of advice:
1 - Continuously observe the opportunities in the market
Constantly look at what trends are emerging, what customers' needs are and what opportunities currently exist in the market to address those needs.
2 – Secure funding quickly to test your hypothesis
Once an opportunity is spotted, it is important to quickly figure out how to capitalise on that possibility as well as gather the necessary resources and secure funding to test the hypothesis.
3 - Connect with customers
Create a value proposition for customers that meets their needs. Using a concept or a solution that creates a connection with customers will address their needs and help to validate the hypothesis.
4 – Execute your hypothesis
Get out quickly and confront reality. The best way to learn is by trying. This provides valuable lessons and provides a basis for making an informed decision about further funding and development.
5 - Pivot or continue to define
You need a test period in which the learning and the concept are validated. If the hypothesis cannot be validated, then pivot – there is no need to throw good money after bad. If your hypothesis is validated, continue to develop the concept in close dialogue with customers.
6 – Bring what you have learned together and make the necessary adjustments
If you choose to continue the development, lessons must continue to be learned and the necessary changes made to the solution
From idea to earnings in 8 weeks
Salling has managed to follow the "recipe" for business agility and cover a lot of ground in testing their hypothesis around the new Basalt store concept.
In a turbulent time, Salling sensed a need for a new offer (and this is in an already strong competitive retail sector) and acted to build a new concept that suits customers' needs in the here and now. They have kept close to customers and promised savings of up to 15 percent. The necessary resources have been secured to test the hypothesis – both financially, but also in terms of transforming older store locations to house the new shops.
On October 11, the first Basalt store opened and Salling managed to execute their hypothesis and hit the market quickly to test the concept. The idea for Basalt was developed in August and with the first store opening in October, Salling Group managed to go from idea to generating earnings in just a few months.
The plan is to open a total of 10 stores at different locations around Denmark by December. A period of testing has been defined and, as Salling itself states, it is customers who will decide how many stores they will open. Basalt is therefore still in a testing phase. This shows you need to be ready to turn the switch off, if it turns out not to be a success – i.e. be ready to pivot if the idea is not validated.
Whether Salling Group succeeds with their new store concept remains to be seen. However, they have already achieved great results through the desire to experiment and to try out new business opportunities – in times of crisis – something that other companies can learn from.
As Salling Group has said, it is important to have the courage to dare to try something new regardless of whether it succeeds or not. Ask yourselves – is it really that basic? I think it is.