No guts, no glory: This is how S Group transformed into an agile organization and rose to the top of Finnish food e-commerce
With its online grocery service, S Group has been able to box the compass and is now the market leader in grocery e-commerce in Finland. The defining elements in their transformation have been switching to agile methods and putting the customer at the center. S-kaupat's vision today is to be the world's most humane grocery store online and offer an everyday companion that makes shopping for food easy and smooth.
Founded in 2009 in Finland, Foodie.fm was ahead of its time. Meant to become the Facebook for food, it was selected as S Group’s online grocery channel. Foodie relied on personalization to provide customers with desired recipes and products, and, over time, molded into a complete e-commerce service where customers could make shopping lists, browse items, and buy groceries.
Fast forward ten years into 2019. Foodie was still alive and kicking, but its technology had gotten old. “Foodie is being updated became a commonly known phrase among customers”, says Emilia Ala-Kurikka, the Product Lead for S Group‘s food e-commerce.
“Although Foodie’s initial concept was personal, it had become far from customer-centric. The development process involved sending hundreds of business requirements to partners for proposals. The company should have realized there were better approaches for prioritizing customers”, Ala-Kurikka adds.
“As S Group started seeing competitors take off, the team finally realized that they needed to change something.”
Getting the C-level onboard is a prerequisite for change in any large organization. After their initial hiccups, S Group was able to recruit the right people to take them on a more customer-centric path. The online commerce team got permission to try Agile for three months, and they came up with a trial called Rapukauppa, which was a huge success.
“We created a completely new online service where customers could order crayfish from Food Market Herkku. Even if the sales weren’t that high, customer feedback was encouraging. The service cost almost nothing to build, and it gave us proof that we were able to build online services in-house. The successful pilot helped convince the C-level of the benefits of an agile model.”Emilia Ala-Kurikka, Product Lead, Food eCommerce, SOK
S Group now knew that to compete, it had to evolve out of its technological, cultural, and organizational depth and learn to be fast. The S-kaupat team was the group’s first agile team, and it wrote down agile principles that dozens of teams would eventually follow.
“The principles emphasize adapting to customer needs as a core value. They also highlight group-level information transparency, employee and team empowerment, and expertise over title-based hierarchies. When creating the guidelines, we thought about how we want to work, but also about how we want to be led”, Ala-Kurikka says.
Putting the customer in the center
To become their customers’ first choice, S-kaupat created a customer experience framework. The e-commerce team started conducting various types of customer research, including questionnaires, customer interviews, and field studies. Customer experience is now measured with multiple scores, and the team activates customers with user tests in a private Instagram Group: S-kaupat & Friends.
“You need to focus your time and money on understanding your customer. Try to be in touch with real customers – maybe even visit their homes!”Emilia Ala-Kurikka, Product Lead, Food eCommerce, SOK
To stay approachable, S-kaupat also dedicated a customer service team to handle customer feedback and satisfaction. The team works closely with other S-kaupat teams and reports monthly.
Finding competitive advantage
To excel in its operations, S-kaupat set clear goals and organized itself in low-hierarchy squads. Substantial changes included removing the middle management, crystallizing the vision and goals, and sharing all data with everyone on the team.
S-kaupat mapped its customer journey from customer acquisition to shopping and fulfillment. Each stage contained many opportunities for both technical and business optimization, so responsibilities were logically divided between development and business growth squads. Each opportunity in each stage has a clear purpose, from enriching the purchase experience and enabling upsell to enabling easy and fast core purchase flow. S-Kaupat’s yearly goals act as the teams’ north star, and they operate them on a two-month basis. Everyone in the squads has the same vision: to be The world’s most humane grocery online.
Last but not least, S-kaupat introduced retros.
“The change from the old development model to more agile ways of working has been eye-opening. Keeping our retros simple and small enables us to make changes immediately and often. Retros also help keep everyone on the team happy, allowing us to improve and maintain our everyday work life”, Ala-Kurikka says.
You can’t plan everything
So how did S Group finally move from Foodie to S-kaupat? After the initial pilot, S Group started building a new online service from the ground up, and the S-kaupat online service started forming in increments. The development was running smoothly – until Covid hit. Suddenly, everyone was compelled to buy groceries online, and Foodie’s capacity failed. The team was forced to launch S-kaupat, even if the service wasn’t ready.
“What we quickly learned, though, was that customers were very pleased with the simplest version. Simple features became loved, such as using your previous template as a base for your next order. Simplicity is now a crucial part of S-kaupat’s development”, Ala-Kurikka finishes.
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