In case you missed my previous blog articles, Part 1 of the Unicorn Project reviewed the early failures of “Phoenix” from the Dev rather than the Ops perspective. (Remember the Phoenix Project is Gene Kim’s prior book about a fictional legacy automotive parts supply company, Parts Unlimited and their efforts to move from a traditional brick and mortar to digital business.) In the Unicorn Project, the main character is Maxine, a very successful architect/developer who has just been “exiled” to the Phoenix Project. After just a short time coming up to speed on Phoenix, Maxine quickly understood why things have gone so far south, and now it is up to her and her team to try to fix things and save the company. In Part 2, Maxine, along with other members of the “rebellion” demonstrate that they can make a difference despite looming odds. In just a few short months, Maxine’s team pays down past “sins” (technical debt) to help begin Parts Unlimited’s digital transformation.
Part 3 opens with just several weeks to go before Black Friday, a day that will stress their computing infrastructure and the Phoenix code base. The Unicorn team is officially named with the understanding that “fast beats slow,” and that this team will power the customization and promotion efforts required for Black Friday. (It is critical that the Phoenix system be able to easily offer promotions to capture needed holiday revenue.)
On Tuesday before Black Friday a 1% simulation test is performed. A serious bug is found, but thanks to improved processes and environment, a fix is made in about 10 minutes, an amazing accomplishment.
Dev and Ops team members go to work at 3:30 AM Black Friday morning. The launch goes off, but the orders are processing too slowly due to the heavy demand on the front-end servers. They offload the servers to a Content Distribution Network (CDN) which prevents everything from crashing. Success, but still a lot of work to prove that they aren’t a Borders, Blockbuster, Sears or ToysRUs.
The results of the holiday sales are significant–$35M in incremental revenue. Additionally, a new mobile store app eliminates much of the manual customer data collection process—a huge timesaver. Given, the perceived digital benefits, management is interested in investing $5M in a new innovation team and plans an innovation contest to pick the top three technology ideas.
Despite progress made, it is still not all “unicorns and rainbows” at Parts Unlimited. Their equity partner requires cuts of 150 people to ensure profitability. Although reductions in force are never easy, efficiency improvements make this less painful. Erik, Agile guru and Board advisor, discusses the concept of context v. core. “Core” is Parts Unlimited’s core business, while context is what’s required internally to support that business. Cost cutting forces Parts Unlimited to determine what context can be unloaded, thus freeing up technical debt. An IT Manager remarks, “I’d pay anyone in duffel bags of unmarked bills to get rid of our helpdesk system…. combined the workload of managing all those things is easily three people…”
It’s now late January and the company reports profitability for the first time in 2.5 years. The CEO concludes, “Because of all the amazing groundwork that Phoenix laid down, the Unicorn teams were able to quickly create promotions capabilities to drive people to our mobile app, e-commerce site, and physical stores. It was an amazing combined effort that include in-store staff and the technology teams.”