Kluczowe wyzwania dla polskiego e-commerce z Marcinem Czyczerskim | Podcast Jak Oni Sprzedają

Thanks first of all, Aga, for the invitation. Yes, introducing myself used to be easier, so let me start with what I did before. For over a dozen years I was at Volkswagen, I was a managing director of one of the subsidiary companies producing a lot of seats for various Volkswagen cars, so I come from production and from a German corporation. Later, at CCC, I started there as vice president for finance, later I was president of the group, and later I had the opportunity to be president of Modivo and eobuwie. Now I work on supervisory boards. I am on five supervisory boards, vice-chairman of the supervisory board of CCC, and member of the supervisory board and head of the strategy committee at Exotic and Henderson, member of the supervisory board of Wita, member of the supervisory board of Rainbow Tours, and member of the supervisory board of Polish Mountain Railways. So there are several phenomenal companies that I have the opportunity to observe, represent, and also supervise from the perspective of a supervisory board member. As you mentioned, my baby is GCG Partners together with two partners, we create a great team. A very nice team that helps organizations in transformations, digitalization, succession, raising capital, various ideas for themselves, but we'll probably have a chance to talk about that.

First of all, I'm glad you see that we have a great team, because indeed this cooperation, working with our crew is great and makes me feel again that I'm doing something that is simply my passion. So big, big thanks to the team. What was the reason, or the idea, the beginning. First of all, Bartek Grabowski and I found ourselves at a similar stage of thinking about our further professional life. I was designing my next stage in such a way that I would want to help companies through these roles on supervisory boards, while also doing consulting. I was thinking more in terms of freelancing, and Bartek Grabowski thought similarly about himself. We were lucky that we both knew Kacper Grabowski. I from the time at Volkswagen, Bartek a bit longer, because they are brothers, and Kacper simply connected us and made a warm intro, which caused that not just the two of us, but the three of us, it clicked very quickly and we felt we had great chemistry, as it later turned out, very similar principles and values. So at that level we have a perfect match, and around that we started thinking about our future as a trio, because Kacper also decided that he wants to be part of this project and he likes it too much to remain just the proverbial matchmaker of two partners, and we operate that way. We are very satisfied with how this is developing for us, both in terms of building value for our clients, building the team, and our cooperation.

As for the most extensive e-commerce experiences, it is certainly Bartek Grabowski, from whom I can certainly learn a lot in many aspects in this area, and it's also nice that we complement each other. However, indeed with the organizations I was in, whether CCC or Modivo and eobuwie, we did quite a few significant e-commerce things, for example building the e-commerce in CCC or developing it, and I happen to have eight years in the CCC group, so I could do a separate program with you about what phenomenal things you can learn from working in the CCC group, so I don't even know where to start. The first thread, I have the impression, is the leap that took place in CCC around, let's say, during COVID, but it was visible after COVID, it was very much based on how much we turned our attention to the customer, how much we learned about them at the data level, how we changed the architecture that led that data to decision-making places, how much we changed the assortment strategy in terms of what the customer does, and that is basically a playbook for most Polish retail companies, more broadly than just fashion.

The second fantastic thread, which resonates very much with my principles, approach to life, and a saying of my grandfather: you recognize warriors by their scars. CCC is an organization where you only strengthen yourself in the fact that if you fall, it's a chance to run faster, change direction, do something stronger. So we went through several crises together there. Each one was strengthening, and no matter what crisis, what negative experience in CCC, I am convinced that it is an organization that comes out stronger. That suited me very much.

And the last issue is entrepreneurship. Again, if you leave after 16 years at Volkswagen, you are perfectly organized in processes, standardization, automation, and you have absolutely no idea about entrepreneurship. So that was the entry point to CCC. And there, an accelerated lesson, because in CCC such lessons with Arek Juk come in an accelerated way, and today I can say that I see very strongly and many potentials, opportunities at clients around them that they do not see. So there are plenty of lessons for clients. I invite you to episode number 2. I invited myself, so note that I can talk a lot about lessons.

Okay. First of all, I'll note that we don't say that, I don't emphasize it myself. I respect advisory firms, consulting firms. I think that in many aspects they have interesting expertise, expert knowledge that they can share. What I also observe from the history of cooperation with such firms is that the moment of separation from advisors, consultants, is at the level of delivering products in the form of some concept, which is usually a presentation that does not touch the core of the problem, namely so what and how we are supposed to do it now, with whom we are supposed to do it. Of course, often change management follows, which is maybe a bit of a way out of those slides towards some action, but still the aspect of responsibility is shifted towards the client. There is a famous video of Steve Jobs. By the way, I very much regret that so many of you are consultants, and it captures it perfectly. Simply, in this domain you have too little time, because such a project usually lasts a few, a dozen weeks, you have too little time to understand and above all take responsibility, to be accountable for the results of what you proposed. And we are only interested in being accountable for results and taking co-responsibility.

So this co-management, I don't know if it's a term, or if we accidentally invented it, we didn't invent it for the sake of properly conveying what we do. We enter into such co-management, meaning we also diagnose problems. Usually we don't need to diagnose that many, because there is a need for executional focus on a few key things. We also build a clear value creation plan under that, but again it doesn't have to be extensive, it has to make a difference, and then most of our work begins, because we have to help the client assemble his team, supplement that team, build on that basis streams that will lead, from the perspective of several years sometimes, or several months, several quarters, the client will see that value, and only that value is an element that we leave behind and for which we are accountable.

So this model in which we enter is a bit different, and at this stage I will probably avoid naming clients, because in such projects you use NDAs, and we are agreed that we will finalize these projects with, one might say, the launch of our joint achievements as business cases. So more on that in a moment, but I can already say that several will be really, really interesting. However, the perspective is usually that of entering a client where the client sees a certain problem in themselves, or rather diagnoses it as a specific problem. That problem is often weakness in e-commerce. Yes.

We help the client understand what this weakness consists of through a simple audit. At the same time, confronting the client with the fact that weakness in e-commerce is a result of several other things that are also very problematic, and how the client should change them. At the same time, pointing out specific solutions and offering to do those solutions for the client, which often means, as I say, that we set up a team, build that team, raise the skills of the team that is there, build processes, deliver tools, but this process takes time, and as I said, we track the value that arises from it. We don't leave the client just with a prescription, a recipe for making some sophisticated dish, but we make a nice, tasty, simple Italian dish, and because the client is doing it for the first time, we assist them a bit, and we eat that dish together and take responsibility that it not only looked good on some GIF, but also is very, very tasty and is eaten in a good atmosphere.

You know, we have both short projects, if someone comes to us and asks for, say, support in some area or building a concept for an app, or operationalizing assumptions around a loyalty program. Those are piecemeal, shorter projects, so those also come to us. However, our flagship ones, as I mentioned, often result from two streams that run parallel and support each other. The first is a request for substantive support in a certain area, within which we discover the client and start seeing things that the client didn't notice, didn't highlight. On the other hand, we take great care of the relationship, meaning before we even enter the project, we make sure that we click with the client and that we have chemistry. We definitely don't want projects where we will struggle with the client and make the client struggle with us, out of mutual respect. So in parallel, this process of building trust and relationship goes on, and during that, clients open up more to our proposals, and we start seeing more. So at some point, there is a new opening, a marking of the true owner's direction, what this company is really about and what we need to do to build that value. And we start acting in that direction. We have ambitious goals regarding building this value, because we marked it very simply. Companies are valued based on EBITDA times multiples. Some multiple, 5, 10, doesn't matter. We help companies increase EBITDA in the streams we define, whether costs, revenues, etc., times those multiples.

Our goal, from a long-term perspective, I won't say how many years, is to build 100 billion in value for Polish companies by helping them turn the right knobs and tighten those that should be tighter.

You know, I'll say this: whether it's me, or Kacper, Bartek, the team, we are matched in such a way that, to stick with the clicking metaphor, we click more often than not. That is, we are certainly very relational, we care to give ourselves the comfort of trust for what we want to create together. And that is important. I believe that cooperation, such alliances, partnerships must build heavily on that, so clicking is for me a synonym for deep trust. No, it hasn't happened that it didn't click. I would say that once it happened that we approached a project, one might say, without that phase of getting to know each other better, knowing a good solution and having a good match. And during the process of getting to know each other better, we decided that this probably wasn't the right moment yet, but that didn't mean it wasn't a click, just that it wasn't the right moment for many reasons. And I think both on our side and on the client's side, it was a mature decision to park it for a different time.

This is a term that can mean many things, both, let's say, looking for nice startup objects, although today the greater leverage for value creation is from the perspective of entities that either need a U-turn or accelerated scaling in an orderly manner. This CFunding can also mean that we are often able to show, for example, our experts we work with, that they themselves should think about using their expertise as entrepreneurs, where we as GCG can support and be their partner by taking minority or majority stakes depending on what it is, and at the same time helping them accelerate in some area, and we also operate that way. Often our model of building value and settling over time for results also means settlement through shares, so that element too. However, today I would say that what has absorbed us the most is this co-management, also supporting transactional advisory alongside co-management, because often co-management means we discover something in the company that indicates, for example, capital needs, and then we help raise that capital to ignite the organization even more in a positive sense. Or we have a situation where the owners decide that it's a good moment to bring in an additional partner, and we support that too. These two things have absorbed us very much and we are slowly becoming associated with them, so we focus on them at this stage of development much more.

I think I wouldn't limit it by industry to a greater extent. We are associated with Consumer Goods, with retail, e-commerce, fashion, so I'd say probably 2/3 of our clients are from that area, but we have clients from the financial sector, logistics, so also other industries, and I wouldn't draw a demarcation line between clients for whom we are and for whom we potentially aren't, but rather from the perspective of the willingness to change or to scale further, the approach to business and to people. And also ambitions, the ability to win, in the sense of whether there is that desire, whether we can mutually spark it or rediscover it to move forward, and that is more the element that decides whether we feel this is the place or not, rather than the industry itself, because I hear and even share the voices of advisors that it's worth being profiled. But a few examples of companies I work with show that we also provide value outside our core, and besides, as I mentioned, I was in automotive manufacturing for 16 years and later 8 years in retail and fashion, and you can have less related industries, yet there is a lot of commonality that can potentially be used.

Well, not so much the strangest, and I can't describe it because I would certainly burn it, but with a client who had a specific challenge, problem, we are working on a solution that, if it works out, I think will be quite talked about and will be a classic leap from problem to great success.

I'm listening to you. More came to mind already, but okay, I'll shut up, I think I've collected four. In the meantime, the first is that we very often hear from the owner side, it's a lack of people, a lack of skills to acquire, etc. And to some extent it's probably true, but when we, for example, are very open and relational people, each of us probably has a network of, I can say, several hundred people who are very competent, very engaged, very willing to cooperate, so often we are, one might say, not so much an arbiter, but a matchmaker between the needs of our clients and the network we have. So that is a huge challenge. Actually, it appeared on every front.

The second thread, quite specific from the perspective of the stage of development of the Polish economy. That is, Polish firms are largely first-generation owner-managed firms, which built these companies with their own blood, so to speak. Consequently, they often naturally have an approach that the company is simply theirs, and thus a very owner-like, economic approach, which often creates a push of the rest of the team in the direction of 'us and them', causing a natural stratification of the organization into owner, management, director, managerial, employee spheres, etc. So you have, as if you stretched it down in rows. On the other hand, it also breeds an organization where product is responsible for product, technology for technology, e-commerce for e-commerce, so it stratifies that way. So when a problem arises, in such a disintegrated organization, everyone focuses on finding someone else to pass the black Peter to, and focus on the fact that the problem is not with me, or not take on the problem that appears because it's not with me. And every such organization that has very wide boundaries between areas is in a very dangerous situation, only it doesn't notice something, doesn't take on problems as a strong challenge, so integration, squeezing in a positive sense of the team from the owner level to the most operational line, and also between departments, is key, and is a huge challenge again for a large part of organizations. Not all.

The third thread is assortment strategy and parameterization, because I also have the impression that a certain trend has swept through the market, a spirit of building in companies, and I've encountered it in practically every one, that you win with breadth, and I agree, if you are a marketplace, then probably yes. However, if you buy something on your own credit, on your own balance sheet, then breadth is needed, but it must be smart breadth, and above all smart depth, so tools, instruments, even Excel, KPIs for this sometimes don't exist at all, and sometimes they are just, as I remember the path we came in CCC with a very good team that helped steer this, they are really on a peg, a stick, a string, and it was like that. Yes, maybe even better.

And the last point is again, comparing to the best, it's a frequent lack of knowledge about the customer, again such parameterized knowledge that allows us to build an offer in real time, tailor it to the customer. That is, being in e-commerce, using e-commerce only for selling, and not using e-commerce as a huge donor, a huge donor of knowledge. Which again can be used for even better selling, but also for remodeling your business. So that's it, for episode number three, because there are more, but these four repeat quite often.

Polish companies? Yes. Yes. Mhm. Generalizing, I would say that you always want more. But I think that Polish companies, generally speaking, have incredible momentum. As I have the opportunity to observe, passively, actively for 30 years, passively for 35 years, how Polish business has changed, I wouldn't bet that it will be in such a state, looking at the delicate level of awareness in the early 90s, where it could go. So Polish companies are really in great shape and do great things and have great prospects, great ambitions. Every client of ours is a phenomenal story and phenomenal potential. That is first of all, I think from the perspective of challenges, when you look ahead. Of course, no one knows in detail how it will look, but things that can cause problems. First of all, asymmetry in how the Polish economy is built. Look, consumer companies, especially retail, lead the way, so we are driven by consumption, so little of that economic growth remains. It goes to the state in taxes, to companies in some margin that remains. However, we are very little driven by investments, and those investments are what remains in the long term, so in my opinion, Polish companies will struggle with the fact that at some point we will feel a gap that other economies invested more. Few invest as little as the Polish economy in investments.

The second thread is that we need to remember that we are in the group of countries of the so-called depressive funnel, demographic funnel, meaning the demographic dent has occurred, looking at the demographic bell, consumption over the next 10 years will be phenomenal. The middle class will spend more and more, many times more. The Silver Generation will be an incredible potential, but from below the problem grows, and again the overlay of irresponsible immigration policy in the sense of being not open enough, populist, where you simply cannot talk about it freely, show the positives, and also strengthen immigration to ensure the inflow of supply of qualified and unqualified workers, future payers of the pension system, that will be a huge problem for this economy soon, because the inflow is too small relative to the gap on the horizon.

And the third thread, as I have a good comparison: Poland and Germany, Germany is the third generation after the economic boom, the Wirtschaftswunder. We are the first. We are in the second and we slowly feel problems in succession, in the economy, in companies, because it is nothing that we will feel in the second generation when we pass it on. So these perspectives in 10 years may be a bit more gray, but I believe that Polish entrepreneurs, Polish business, Polish managers, Polish workers are phenomenal, smart, entrepreneurial, so these are challenges that we will certainly deal with one way or another.

You know, I happen to be from an area of the world where I can say that when we entered COVID with the label of the first most severely affected victim of COVID, because that's how CCC was talked about at that time from that perspective. Of course, our cash situation then was unenviable and, to my knowledge, the most difficult in retail, but from the first day, from the owners, management, and staff, we had the approach that we don't know exactly what, but we will come out of this crisis stronger and more powerful. That's what happened in the end. There are several things that COVID simply accelerated, and we were very flexible, very agile, and also very resilient to stress, taking on various challenges, so positively. On the other hand, I also know companies where COVID fueled a spiral of debt from which they have not yet emerged, and having great businesses, they are somewhat victims of the fact that suddenly electricity, gas, the dollar, other things skyrocketed, and it still sits on them, hindering the development of these great companies. So on the side, I would even say it would require a systemic solution at the state level to look at these businesses that are very healthy but due to something like a typical force majeure, have fallen into a more difficult situation, having a very strong healthy engine, right? Because for the Polish economy, it would be good to cut off certain things for them.

You know, bottlenecks could probably be the same ones I mentioned, challenges of Polish enterprises, so bottlenecks are access to experts, to competencies. A bottleneck is certainly in some cases, due to post-COVID difficulties in raising capital, a bottleneck very often is already riding for several years on a pulled handbrake of technological debt, which today does not allow to smoothly connect and use various nice solutions, among others that you produce, which require even on the company's side, even though you are so plug and play, sometimes on the company's side the handbrake is pulled so that something needs to be changed, so I would definitely mention those. Another bottleneck, but self-inflicted, is again data availability, processing that data, analytics of that data, I'm not talking about data scientists, but even people who can later build decision-making routines based on that data. It's clear that these are quite significant bottlenecks, but also a bottleneck in many companies is simply a lack of leadership, teamwork, and that is often a basic element, a purely human one, that comes out.

Something was spinning around that topic, but I don't know it in e-commerce. Definitely a good tip.

We have wonderful clients above all, because it pays to enter into situations where these relationships are simply close. So we get a lot of feedback, very positive feedback. We've heard from wonderful people that we fell from heaven. It's a shame it's so late, but good that at least now. We've also heard feedback that is very positive, that you didn't say anything we didn't know, but hearing it from you, it's time to do it. Or that we haven't worked with advisors before, but we probably had to wait for someone like you. So we have a lot of positive feedback. Sometimes I'd say even too early, because as I mentioned, it assesses the beginning of the collaboration, because we've only existed for nine months, so the first effects are just showing. So such feedback for me, for Kacper, for our team, it works very obligingly, motivating, because it motivates even greater involvement, because we have such clients that it is very much based on trust, and you never want to break trust. So when you hear such words, you feel even more desire to deliver even more. And we have examples where the broadly understood fashion industry is having a difficult time, a difficult autumn because of the weather, etc. And we have a client who had a great October, a great November, so you can see that these very multidimensional effects are starting to work. Sometimes, as I say, these are the beginnings of cooperation, where we pointed out, for example, some myths in the client's approach and in their assumptions, even in the marketplace area, like 'on Allegro you do it this way.' Where we, from our experience and with very strong experts who have cut their teeth on Allegro and are very senior, said that's nonsense, and we insisted it was nonsense, and today it turns out it was nonsense squared, for example. In the sense that someone once shoved something into someone's head and how it can be reversed. Mhm.

I think it would be hard for me to take on a project based on my experience and knowledge from Volkswagen and CCC and e-commerce, the ones that succeeded were those where we, as management, found time to be present at those projects. Therefore, if there was no management or owners, anointing, giving that mandate, then I think there would be no point in taking on such projects, because they are inherently flawed with a risk of lower probability of success. So sometimes we start, but we quickly catch someone who must simply understand what we're doing, what's going on here. One story comes to mind, but again, Aga, this is from the perspective of some transformation, change projects – I've done hundreds. They've seen everything, and it's a game that for these companies might be the first time they're trying something, but you see it, you know that okay, we'll chat for a while, you have it all there, and soon we'll challenge each other on something where we'll just have to play a different tune. So even in a way, I don't want to say funny, but it's an element that you break, but you break it in a way that I've always put the team at the forefront. So when the team starts to understand that we're not there to harm anyone, but to improve the company's situation, to use its potential in a company that is simply not nice, and at the end of the day it pays the salaries, then we all have a common interest. I am more afraid of situations that I have also experienced strongly, which taught me a great sensitivity to read and react to them. It's a situation where, as I mentioned, the organization is a bit like Kurpie paper cutouts – I might be confusing with Kujawy – you cut and so on. At Easter you cut and these people who do it, beautiful things, you stretch them and suddenly in the middle it's empty. And the same with organizations that have stretched like Kurpie paper cutouts, in the empty places there are places of politics, and then such projects are really difficult, because that one tries to trip you up, going around, having his own link, it turns out it's someone's cousin, etc. But again, I even once studied political science to understand and read such social engineering, manipulation, and again, they are deciphered quite quickly, and if they are contrary to the company's interest, then it's quite pleasant to play them out, so to speak, to get rid of them. However, they are indeed in the company, and I often consider it added value that we also manage to expose them.

Yes. And here we touch on the worst situation, which is when someone will nod along. That typical Patrick Lencioni, five dysfunctions of a team, will go out and start politicking in the corridors to make sure this topic doesn't come out, because perhaps it's not consistent with his personal interest. Those elements where he or she is silent are probably open and require on the part of us seniors to open someone up, because probably there is incredible competence sitting there that needs to be brought out. However, those who I remember in e-commerce, my first meeting as CEO, where I told people that I really value it when someone opposes me here, and after five minutes I regretted it, because it turned out that they went at it very hard, but it is ultra-valuable. And again, I'm not saying that the one who opposes is right, I'm not saying that I'm right, but from the confrontation of these positions, a more adequate view of what hurts us, what needs to be done, usually emerges.