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Collision of cultures: The John Lewis way to manage SME-corporate collaboration

Speaking with John Lewis, Real Business has heard how and why the reputable British retailer has embarked on the process of SME-corporate collaboration.
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Since 2014, John Lewis has run the JLAB business accelerator programme, which makes it clear that SME-corporate collaboration is something that’s high on the agenda for the firm.

But how exactly did the company introduce the scheme and why? John Lewis’ innovation manager John Vary was keen to share Corporate Insights to Real Business, our feature which provides growth businesses with details on what can be learned from large established counterparts.

Starting on why the JLAB was needed, Vary explained that the idea was to embrace emerging technology and retail innovation to create long-term relationships of mutual benefit with young tech companies.

“Bringing a unique group of startups into our headquarters for three months allows us to embrace that agile, entrepreneurial mindset and expose our Partners (staff) to fresh new ways of thinking and working,” he said.

“John Lewis was founded on the spirit of cooperation and partnership, and so the JLAB programme is almost a return to the roots of our business. We held the fourth JLAB programme pitch day on 6 June and kicked off the 12-week programme on the 10 July.”

How does the company’s accelerator differ from other alternatives though? How can a business of 87,000 employees make this transition?

Vary said that the idea of JLAB was to avoid being “just another accelerator”, offering candidates the chance to unlock potential with products that can be used by consumers after integration throughout John Lewis and Waitrose stores.

On the SME-corporate collaboration front, he added: “Central to JLAB is the support that finalists are given. Each business is given access to senior people from around our business in addition to dedicated board lead members of different departments as sponsors.

“Alongside internal talent, we ensure that each finalist is matched with an external mentor too. This too, provides a different point of view and further insight for members of our cohort. Together both mentor types provide support during the programme but also act as a champion post-graduation.”

John Lewis Waitrose cashless

A prime example of innovation throughout the business was the launch of a Waitrose cashless store at the HQ of Sky

Those involved in JLAB programmes can also receive access to feedback and UX data from customers. A £200,000 fund is available from John Lewis and innovation partner L Marks too, with winners able to secure funds of up to £100,000 in exchange for company equity.

As three years of JLAB have passed, 2017 saw Waitrose introduced to the programme alongside John Lewis, which Vary said is a result of the process being honed.

“JLAB isn’t a ‘side-project’, we see the programme as a crucial way to expose our wider business to emerging technologies and the startup mindset,” he said.

“Just as we have witnessed across other parts of our business, food retail is becoming more and more experiential. A joined-up approach just makes sense and reflects the way the John Lewis Partnership is evolving as a business. There are lots of exciting things happening in food tech and we want to be central to its development.

Just some of the six JLAB 2017 categories include amazing food experiences, effortless shopping and surprise us – the latter of which is for developments that can’t be pigeonholed, emphasising the range of SME-corporate collaboration John Lewis is open to.

Offering lessons to growth companies, Vary explained that John Lewis was built on cooperation and encourages rising businesses to adopt the same culture.

He noted that Ding Labs from the 2016 JLAB didn’t secure funding, but it did secure useful senior advice that allowed the team to build relationships for SME-corporate collaboration within the John Lewis buying team.

It’s not all about what the big companies can do for small ones when SME-corporate collaboration is introduced though, Vary detailed, insisting it’s a two-way street.

“Working with startups exposes an organisation to an agile, entrepreneur mindset and we’ve certainly seen this have a real impact on our business over the last three years,” he said.

“For example, we launched a co-branded website with Wedding Planner last year, using systems they’d already put in place, and linked this with the John Lewis Gift List.

“This allowed us to test the value of the JL brand in the wedding industry and identify the opportunity to tie our Gift List/Insurance offer with WP’s planning tools – as expected, this proved a very popular option with those using Wedding Planner.

John Lewis was able to secure a great amount of data through the tie-up as well, analysing customer behaviours across everything from page stickiness and where they were heading.

“This kind of background on how visitors behave online is immensely valuable to any retailer and was certainly a real customer experience learning for us,” he added.

Without that SME-corporate collaboration in place, John Lewis would have had to build its own site, while Wedding Planner would not have had access to the brand name.

John Lewis Waitrose

“The startups involved need to draw value from the process”

In terms of difficulties to be aware of, Vary said: “I think that whenever a corporate starts working with startups, there is always a challenge of two different cultures colliding.

“An entrepreneurial culture is by its definition is much more open to risk-taking, and startups are generally more agile, fast-paced and innovative. Corporates, on the other hand, have to proceed much more cautiously and can be constrained by internal structures and processes.

However, John Lewis has been able to break free of the corporate shackles of rigidity. An in-store trial was arranged for a finalist last year in just a couple of weeks, compared to what would have taken months in the first JLAB launch.

Vary said: “At JLAB we foster a culture of openness. We base the programme across the Partnership’s headquarters at both Bracknell and Victoria. This means that the startups have access to our entire business – if they want to speak to the buying team or IT department they can.”

He highlighted the importance of having senior John Lewis voices back JLAB, with the likes of CIO Paul Colby among them, which in turn encourages other staff members to embrace the SME-corporate collaboration movement.

On whether other corporates should adopt a mentorship attitude like John Lewis has, Vary opined: “Since we began JLAB four years ago we’ve seen accelerator programmes become more popular as retailers recognise that they require the latest technology to provide shoppers with a seamless shopping experience and top tier products.

“However, the relationship cannot be one way and the startups involved need to draw value from the process too. That’s why we made the decision to embed the programme inside our headquarters instead of a separate office.

“I’m proud to say we continue to drive the spirit of collaboration and innovation forward as we welcome the finalists for 2017.”

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About Author

Zen Terrelonge

Zen Terrelonge is the deputy editor of Real Business, specialising in media, innovation, technology and the digital sector. A media professional with eight years worth of experience he has worked for both startup and established publications.

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