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The case study presents several challenges to Sendwine.com. Of those, I believe the following are the most notable, unordered: Proposed ChallengeRationaleSuspected Cause Recruiting / personnel with the rapid growth Sendwine experienced, and with the capital influx to support it, many new people were added to the organization in a short window. A lot of “new” without training and transition can be disruptive.
Explosive growth forced a need to add people fast. With management spread thin and time at a premium, corporate strategy, onboarding, and training programs and corporate organization and communication probably suffered or didn’t exist. Project ManagementExplosive growth and lots of opportunity fueled by immense venture capital inflows created a lot of things to get done. With existing management and staff maxed-out and time at a premium, time must be spent where it creates the most value. I suspect that little to any effort was spent prioritizing and organizing projects.
Trying to pursue everything at once created lots of projects in progress (or WIP) but huge lead times and relatively slow project execution (completion). Consistent StockingThe Sendwine business model distributes wine through local, mid-sized wine stores. There appeared to be no standard inventory selection that could be offered and assured in stock. Sendwine did not mandate a consistent inventory to be supplied across its distributors (or a method to inform customers of specific local inventory) resulting in variation, stockouts and substitution Recommendations
Given the challenges presented, I propose implementing the following solutions to drive the corresponding expected outcome: Proposed ChallengeSuggested SolutionExpected Outcome Recruiting / PersonnelInstall a HR director from within. Partner with outsource HR firm best suited to handle tech/wine areas. Have firm handle recruiting efforts with direction from HR director. Coordinate development of onboarding and training program with policies/culture/process documentation. Culture preserved in the face of blazing-fast growth. Increased project completion. Better hires and at a rate consistent with need.
Decreased learning-curve time. Project ManagementDetermine if management/leadership has adequate project management skillsets. If not, make a strategic hire. Prioritize all projects and insist on efficient communication and execution using project management tools and leadership. Improved growth trajectory. Increased shareholder value. Competitive advantage. Increased likelihood of gaining venture capital when in a competitive situation. Consistent StockingCreate a core list of wines to appeal to most all customers. Make sure these wines can be stocked by all distributors and insist that they are.
Eventually add specialized wines and adapt the online store to display location-specific inventory. Increased purchase rate. Decreased stockouts. Increased repeat customers. Decreased eShopping Cart abandonment. Rationale/Analysis The table below presents the rationale for each suggested solution based on the information provided in the case study: Proposed ChallengeSuggested Solution (Summary)Rationale for Suggested Solution Recruiting / PersonnelHR Director / OutsourceUsing experienced HR staff (outsourced) allows internal resources to focus on core-competencies.
By having an internal HR director, consistency with existing culture and values can be maintained. Documenting processes and creating onboarding shortens the learning curve for new employees. Project ManagementProject. mManagement Tools Prioritize / Strategic HireAlthough time will still be a premium, time will be spent on the most urgent and/or value-rich projects. This will help guide the company in the right direction for growth and sustainability. Consistent StockingCore Offerings / Adaptive eCartCustomers will be more likely to buy because they can see the exact product and presentation that will be delivered to their recipient.
Inventory will always be available and stockouts will be rare. Conclusion Sendwine has an enormously wonderful problem: how to best grow fast when all the resources are at your fingertips. Although a nice problem to have, it’s still a problem. The key to the solution lies in sustainability. Although fast growth is required to edge-out competition (especially in 2002 when it was a “get big fast or die world”) sustainable and solid growth with a scalable company is ultimately what will drive the most long-term shareholder value. And after-all, that’s management’s uncontested top priority.