Supervalu DC

How much innovating can a chief innovation officer do?

The word innovation has become almost meaningless in the grocery business where the handle is applied to seemingly every new brand line extension and me-too strategy introduced by a retailer or wholesaler. So what exactly would a grocery executive do if given the title of chief innovation officer? Pay attention to Supervalu because we may be about to find out.

On Tuesday, the grocery wholesaler and retail chain operator announced the appointment of longtime C&S executive James Weidenheimer to the newly created position of executive vice president, corporate development and chief innovation officer. Mr. Weidenheimer, who will report directly to Supervalu CEO Mark Gross, will work closely with the company’s various units to develop new business and cross-channel merchandising and promotions initiatives, while driving integration of logistical solutions for its retail customers.

Mr. Weidenheimer served as senior vice president for corporate development at C&S Wholesalers between 2008 and Jan. 2016. Before that, he was CFO for the wholesale division of Rich Foods.

“Jim has a wealth of industry knowledge and extensive expertise in procurement, distribution and logistics and is able to draw on all this experience when considering how to best structure new offerings for a customer,” said Mr. Gross, who became Supervalu’s CEO in February. “I’m confident that he’ll bring instant credibility to this role and innovation to our business. We believe there are significant opportunities to grow our business with existing customers and also to add new ones and Jim will be an excellent addition to help us achieve these goals.”

BrainTrust

"While it is great that Supervalu realizes it needs to refresh its go-to-market, naming a single executive to head up innovation is not the solution."

Patricia Vekich Waldron

Contributing Editor, RetailWire; Founder and CEO, Vision First


"I have one question: does he get a budget? And an organization? Because without those, it’s a publicity stunt."

Nikki Baird

VP of Strategy, Aptos


"The problem is that most retailers operate in a CFO centric world where IT budgets based on a "hard savings" perspective and the annual planning processes are based on a goal to reduce IT and business spending by X%."

Ken Morris

Managing Partner Cambridge Retail Advisors


Discussion Questions

DISCUSSION QUESTIONS:
What are the keys to achieving true innovation in established businesses such as grocery wholesaling and retailing? What shape would you expect innovation to take at Supervalu now that management has charged an executive with creating it within the organization?

Poll

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Chris Petersen, PhD
Chris Petersen, PhD
7 years ago

In the world of omnichannel, retailers have not been realigning their organizations and systems to keep pace with the changing behaviors of consumers.

Far too many traditional brick-and-mortar retailers are still structured in silos. Operations for the stores are often still separated from online. What is missing entirely is the ability to restructure around the changing consumer expectations for a better experience (e.g., purchase online and pick up at curb, or better yet, home delivery).

What is needed from a Chief Innovation Officer? Bezos perhaps says it best when he describes Amazon as a “culture of failure.” Amazon’s amazing innovation is built on the premise of “failing rapidly” in order to discover what works. The Chief Innovation Officer at Supervalu has to stimulate more testing focused on the customer experience.

The issue for Supervalu is not creating a new C-suite role. Their survival depends upon the C-suite creating a “culture” of innovation from bottom to top — starting with the customer experience at the core.

Dick Seesel
Dick Seesel
7 years ago

This is a title (like “Chief Experience Officer”) that only means something when the underlying value is embraced by the entire organization. It’s hard to impose “innovation” from the top down if it’s not part of Supervalu’s everyday culture. And the most innovative companies — in any industry — focus on innovation from the ground up.

When you read the job description from George’s article (“will work closely with the company’s various units to develop new business and cross-channel merchandising and promotions initiatives, while driving integration of logistical solutions for its retail customers”), does this sound like innovation? It sounds like Supervalu is aiming for better execution of omnichannel, multi-platform opportunities and supply chain management. But “innovation”? We’ll see.

Max Goldberg
Max Goldberg
7 years ago

In many companies innovation means disruption, so a Chief Innovation Officer needs to tread lightly while looking for ways to improve a business and keep a constant eye on the cost vs. profit ratio for implementing new ideas and bringing in new products. Most established businesses do not handle change well. In grocery there are so many moving parts that a small change in one area often ripples throughout organizations. That’s not to say that innovation is not necessary. It needs to be handled in such a way that the effected areas of the company embrace change, realizing that change will bring benefits to the company, its suppliers and/or consumers. And then that change needs to be documented in ways (numbers) that prove what’s worked and what has not.

David Livingston
David Livingston
7 years ago

From my experience, this type of job is usually a make-work position created by the CEO to help out an old friend from his former employer. Often this person will have expertise in areas that the CEO is weak in and the CEO wants someone he can trust to talk to. As for Supervalu, just take a look at the new innovations in the industry from the early 2000s and most likely they will finally come to Supervalu and get the company into the 21st century.

Gordon Arnold
Gordon Arnold
7 years ago

Is there no end to how convoluted an organizational chart can become? A closer look at the strategic overlapping of key decision processes makes it impossible to assign ownership of responsibility. Is it any wonder companies like this can do nothing to help themselves build a better company?

Anne Howe
Anne Howe
7 years ago

Customer experience improvement and sales increases are the ultimate measure of innovative changes in a retail operation. I’m encouraged that the position reports to the CEO, because ideally the CEO could enforce the change to become real.

I also agree that fail fast should be the operational mandate within a key set of stores.

It all comes down to understanding where the shopper is going and being willing to test and learn how to meet or exceed expectations. if all innovation comes from the wholesale side (back of the house) then to me it’s more of yesterday’s news.

Patricia Vekich Waldron
Patricia Vekich Waldron
7 years ago

While it is great that Supervalu realizes it needs to refresh its go-to-market, naming a single executive to head up innovation is not the solution. Everyone in the organization must be focused on how they can execute flawlessly, remain vibrant and help their network stand out from the crowd.

Ian Percy
Ian Percy
7 years ago

Here we go again.

How do you tell when an organization has a quality problem? When they appoint someone in charge of quality.

How do you know when an organization has no innovation? When they make innovation an executive position.

As Dick wisely points out above, innovation is a way of thinking, it is not a bureaucratic position. What someone in charge of innovation will do is come up with some idea and impose it on the employees. They may like it or may not. If not, executives will fight the old “resistance to change” battle.

There is a huge difference between innovation and creativity, the latter being the originator of the idea. The first light bulb was creation, every improvement since has been an innovation. Another word for innovation is “Best Practice” — i.e., copying or adapting an idea someone else thought up. Innovation is not likely to give you the competitive advantage you’re seeking because it’s a “me too!” strategy. You know you’re in this category if your favorite phrase is “Let’s not reinvent the wheel.”

A client of mine is facing the same challenge but taking a totally different approach to it. They believe that every employee is capable of genius — capable of seeing new possibilities that others in their competitive arena don’t see. While it’s true that many of those possibilities will be innovations, we’re confident that we’ll see game-changing creativity as well.

We’re putting on sessions teaching employees to think differently, to tap into their intuition and imagination, to learn how to do research in order not to replicate the past but to trigger new ideas.

It’s about thinking, about the cultural mindset. That, of course, requires that people actually have time to think which rarely happens. Inc. had a wonderful article recently suggesting that successful people find 10 hours a week to think.  Build that into your organization and you’ll reap unimagined rewards!

Nikki Baird
Nikki Baird
7 years ago

I have one question: does he get a budget? And an organization? Because without those, it’s a publicity stunt. If he has real resources in order to drive change then I’m more inclined to feel like he has a shot at success. But it is a dangerous tactic to call out a “special group” within an organization that is the only group with permission to focus on the cool stuff. Especially an established business with a heavy load of baggage called “because we’ve always done it this way.”

I wish him lots of luck — he’s going to need it!

Roger Saunders
Roger Saunders
7 years ago

Organizations have to make “innovation” a part of their culture. Making innovation a part of strategy, execution or structure simply does not have a good track record of success.

Companies like Kroger, Wegmans, 3M, Nordstrom and Facebook have provided an environment for the concept of innovation to flourish. When someone at any level of the organization comes up with an idea that offers promise, it can be moved forward in an efficient manner, because the culture reinforces it.

For companies like Supervalu to make innovation a priority, it has to stem from the CEO choosing a legacy associate who understands and believes in the organization. That individual is part-cheerleader and full of experience in strategy and tactics. He/she will not win the game by command and control tactics. They need to engender and reinforce the innovation concept throughout the organization. Great ideas come from any source within the company or even from a customer.

Ken Morris
Ken Morris
7 years ago

If Supervalu gives James Weidenheimer the teeth and budget, there are some truly innovative projects that dramatically improve the efficiency of operations and enhance the customer experience. The problem is that most retailers operate in a CFO centric world where IT budgets based on a “hard savings” perspective and the annual planning processes are based on a goal to reduce IT and business spending by X%. This hard savings approach is short sighted and lacks the ability to consider innovative projects and investments in the future.

Retailers need to consider the “soft benefits” of investments in innovative technology that drive increased satisfaction and sales soft benefits. Retailers that will be successful in the long-run will use soft analysis to help drive investment decisions and will invest in the infrastructure that enables innovative technology that drives a better customer experience. Innovation is powered by the “soft” approach.

Some of the key areas that should be a focus area for innovation relate to real-time retail capabilities. The truly innovative companies are moving as much technology and applications as possible to the cloud to enable real-time visibility and access to customer information and products. Real-time retail improves the efficiency of operations, such as centralized pricing, and is an enabler for advanced customer services like order online and pick-up in the store and has an amazing capability to leverage real-time analytics to impact the in store shopping experience before check-out.

Peter J. Charness
Peter J. Charness
7 years ago

Culture is often defined as “how the leadership acts.” A Chief Innovation Officer isn’t necessarily doing the innovation, he/she is encouraging a culture of innovation throughout the organization. If properly supported by the rest of the C-Suite it makes perfect sense to have an ambassador of this cultural change within the organization, with or without a team and budget.

The choice of title is a bit unfortunate though. The acronym is CIO and we all know how people translate that one….

Craig Sundstrom
Craig Sundstrom
7 years ago

What’s next, a Chief Profitability Officer? Innovation comes when people who are smart and very good at doing their jobs figure out a way to do them even better. The idea that someone can come along and “create innovation” comes readily to those who have little hope of actually developing any.

Ken Silay
Ken Silay
7 years ago

Innovation has been hijacked by the marketing departments of most organizations. Real innovation is about creating sustainable growth year over year, not just the latest high tech gadget or process that someone has discovered and/or implemented.

Creating the innovation ecosystem that can sustain growth is what successful companies build. It includes a supportive organization structure, effective talent, a forward-thinking culture, a common belief systems, lean processes, sources of funding, i.e. venture capital, defined metrics and a corporate-specific definition of innovation.

The new Chief Innovation Officer at Supervalu will need to assess their competency in each of these areas, define the gaps, and build a map that provides a direction that can be funded and executed. It’s about seeing the future of the organization and paving that pathway to continued growth.

Vahe Katros
Vahe Katros
7 years ago

Here is what I would do — first here is something I found on the web:

“What’s less known about the “Miracle On Ice” team is that it was made up of mostly Minnesotans, with 13 of the 20 players on this team born in Minnesota.”

If I were Mr. Weidenheimer, I would contact as many of those players as possible and have them become part of the effort to help achieve a Miracle in Retail! I would create a culture that recognizes that this isn’t just a resume building exercise. That thousands of jobs are at stake and that Supervalu has done this before. I would make myself accountable and commit to a work ethic and commitment that is what Minnesota is all about. The rest will follow. Herb Brookes once said: “Great moments are born from great opportunities.”

Everyone on Weidenheimers team has a great opportunity. I am sure they can make a difference, but right now, they have yet to face any opponents, never mind the Red Army team.

Brent Biddulph
Brent Biddulph
7 years ago

Leveraging analytics to differentiate, or even modestly drive incremental improvement is a no brainer — given the Chief Innovation Officer role is actually empowered to collapse silos of out dated lines of business in grocery.

A good place to look is revamping (aka replacing) Category Management practices focused on a tired product-centric business model that is no longer relevant. Or, at least, infusing customer analytics into core decision making processes — leading practice retailers, yes, even grocers are doing this today … what Kroger has accomplished with 49+ consecutive comp store sales increases is not magic, rather a top down commitment with a willingness to experiment and continuously improve business processes.

Change management is overdue for the majority of grocers today, and it will take a serious commitment from an executive ‘team’ whom are truly invested in moving from today’s ‘run the business’ to ‘change the business’ mentality — one person alone can not “own” innovation.

To borrow a phrase from the 1990’s — the ‘paradigm’ has indeed changed in that innovation is no longer a nice to have, rather a business imperative that will require corporate level commitment and investment of enterprise scale. If inspiration is needed, look no further than the moves Brian Cornell is orchestrating at Target where a once laggard “grocer” is quickly making the right moves to not only achieve parity, but potentially becoming a real threat to traditional grocers. And of course, there is Amazon, forging the way with never ending innovation that provides an endless aisle of grocery products, dynamically changing prices on thousands of products, multiple times a day based on competitive activities and can now deliver groceries to your doorstep in less than 2 hours.

Opportunities abound for those willing to innovate in grocery retail as new technologies, citizen data scientists and rich sources of data continue to provide fertile resources — only the courage and commitment to paint the vision, strike collaborative partnerships and lead internal teams are holding back innovation in grocery today!