How to Avoid the "ivory tower" Syndrome in Business

RCH CEO Stefano de Pra explores how technological changes are influencing the EPOS market

How to change in changing times

In the first of a two part interview with RCH CEO Stefano de Pra we explore how fiscal and technological changes across Europe are changing the way that the cash register and EPOS markets operate, and how a company can leverage effective strategy to not just stay abreast of these changes, but stay ahead of them and turn them to a point of strategic advantage.

What strategy has RCH deployed over the previous year?

This year has been an interesting one, because we’ve actually had to adapt our strategy quite heavily in reaction to external circumstances – particularly the way in which fiscal reporting needs to be undertaken by all businesses in Italy now – small and large.

In essence, changes in the fiscal law are changing how electronic cash registers must function – in relation to the data they hold, how secure and untamperable this data is, how and where it is saved, and how reports should be created for authority review. Following the approval of the Budget Law 2018, e-invoicing has becoming mandatory for B2B and B2C suppliers of goods. These must be signed with a digital signature, made available in .XML format, and sent to authorities by something called the Sistema di Interscambio (SDI). But of course these are only the bare bones of the requirements – the technical and legal specifications are detailed and complex. Making sure that every solution that we offer meets our clients’ legal obligations has therefore been our first and foremost priority.

But, changes can be chaotic and might need more time than expected. For us, this is a real challenge – we’re used to thinking of design in a progressive and predictive manner, rather than a reactionary one. We like to plan ahead and foresee the needs of our customers before they arise. However we managed to cope with this complex procedure by making our internal strategy even more agile and adaptable – ready to handle any changes requested by the new fiscal law.

Moreover, these changes aren’t just occurring in our domestic market of Italy, but across Europe – in countries such as Germany and Austria, to name but two other markets we are present in. So we’re not just adapting to Italian law, but the laws of a number of different countries too. Whilst often the underpinning philosophy is similar, the technical details needed for implementation can vary quite significantly.

We have always been diligent and meticulous in the way that we develop our products, and so for us it has been absolutely key that we aren’t crashing through geographical markets blindly, but instead making sure that we are the best, most effective, fully compliant solution for each market that we compete in.

You talked about being innovative and forward thinking, but now increasingly agile and adaptive. How do you actually get these values to permeate throughout RCH?

I think your ability to grow certain skills within the business – such as those of innovation or agility – come from a process of instilling the right habits and the right culture.

Within the business there’s a culture of not taking what you know for granted. It’s a tricky thing – to build an incredible knowledge base, but every morning to wake up and forget what you know, so that you can approach things with completely fresh eyes. My team are amazing at bringing their new eyes to a situation, every single day.

This has been particularly true in relation to the fiscal law comments I made above. It could become too easy to focus on developing products that are fiscal law compliant, and not think of anything else. But that would go against everything RCH has previously stood for. Our products have always aimed to push the ability of the technology forward holistically: making it more aesthetic, more usable, more functional, and more able to support businesses strategically. There was a risk that we would get bogged down with technical legal compliance in our latest product developments, but by having a team full of ‘new eyes’ approaching the task every day, we ensure we stay at the top of our game in every dimension of product development. It’s important that we’re seeking to fulfill the full needs of the clients, not only the requirements of the fiscal law.

So how does this wider business strategy inform how you develop products?

Personally, I’ve always thought that innovation doesn’t come from ‘putting yourself above the customer’ – creating something wacky and telling them what they need. That’s innovation for the sake of innovation, and it can result in a lot of frivolous and unnecessary development. But it isn’t sitting down with the customer and asking them what they want either. That just leads to a slow, reactive approach that will be behind the times before you even get the product to market.

Sometimes clients don’t necessarily know what they need. But if you are careful, watchful and analytical, then you can see what they need – predict it – and that’s the kind of innovation that I think is important; not ‘sci-fi fantasy idea’ innovation. My favourite thing to do is to go and grab a coffee and sit in a restaurant. I seem like I’m reading the newspaper, but in reality I’m peering over the top and watching how people are using the systems around them. What is working? What is causing them difficulties? Where are the bottlenecks? What is the ultimate impact of the system on both the server and the service? I really encourage all RCH employees to think like this – not only designers and engineers.

Another thing I like to say is that it’s important to ‘put yourself in the way of luck’. We’d all like to say that our successes are self-made, but you should never underestimate the role that luck plays. The important thing is to be ready to catch it when it comes. Have systems that help you to recognise luck and move quickly on it, develop a way of thinking that lets you see luck as an acceptable risk, rather than categorise it as something to be feared and outside of your control. There are trains coming along every minute. Many of these trains are going to tiny villages, some of them are on the fast-track to a bustling city. The trick is figuring out which train it is you want to board.

And finally, I think on top of all of this, communication is the main thing. Opening lines of communication, horizontally and vertically, internally and externally. Everybody needs to be ready, willing and able to talk about what they think works, and what they think needs improving. If I want my company to do the right things – to innovate, to display agility and adaptivity – I have to tell them when they’re doing things right, and guide them when things need a tweak.

More than that though – communicating what we’re doing well is vital, because I want all of our stakeholders to share in our successes, to be invested in them, and to recognise that those successes are entirely down to their efforts and skills.

Is that why the 50th anniversary has been so full of events and celebrations?

Absolutely. The biggest things this year have been our trip to Madagascar for business partners, and a sumptuous birthday party dinner at Casa Gobbato – that really was a dinner to remember. But these things aren’t just about saying ‘thank you’, or acting as an incentive for greater performance. They’re another mechanism for us – as management – to get closer to the people who drive our business from its base. These events are key to avoiding the ‘ivory tower’ syndrome that I talked about before – where managers think they know their business best, think they know what the client needs, and go about issuing dictates without really having a feel for what’s going on in the real-world.

These types of celebrations – along with attending conferences and exhibitions – are vital for us to keep connected to our lifeblood. These are the types of situation where we can find out how people really feel about our products. Talking to business partners on a sun-lounger in the Madagascan sun, we can hear what questions potential customers are asking, what fears they hold, what needs they believe they have.

Ultimately, we keep our ears pricked, our eyes fresh, and our minds open – and it’s this that affords us a position of market leader across so many POS categories in Europe.

Next month, Stefano de Pra talks about what 2020 holds in store and what it means for RCH to hold a position of ‘market leadership’ in its domestic market and wider Europe, as well as diving deeper into how RCH is changing both mindsets and conventional practices in the field of POS use.