Crossover Podcast Part 2: Humans + AI: Balancing Culture, Creativity, and Commerce Growth

Transcript

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Lauren Livak Gilbert (00:00):

Welcome to Unpacking the Digital Shelf, where industry leaders share insights, strategies, and stories to help brands win in the ever-changing world of commerce. Welcome to our first ever crossover podcast, where we partnered with the Future Commerce podcast and Phillip Jackson to do a two part series. This is the second part of the podcast, so go over to future commerce and listen to part one and then jump over here to listen to part two as we explore the omnichannel organization of the future and how AI is changing the way we work. Hello everyone. Welcome to part two of our crossover podcast with future Commerce. Thanks for doing this, Phillip.

Phillip Jackson (00:56):

Oh, I'm so glad to be here. Thank you, Lauren.

Lauren Livak Gilbert (00:58):

And I want to make sure I call out Phillips podcast, so make sure that you go to future commerce.com to check out part one where we talk about what happens in 2030 if we're thinking about org structures and what's coming next. And now we're going to get a little bit more tactical.

Phillip Jackson (01:15):

Oh, we are. We are. And this report that you guys have put together, we already did this sort of 2030 big picture glimpse. I want to talk a little bit about how we actually make it happen, the steps we put into place, and I really want to get in the weeds a bit.

Lauren Livak Gilbert (01:33):

Let's do it.

Phillip Jackson (01:34):

So, okay, just sort of diving in, I had a couple questions. We talked a lot in part one about org structure, et cetera. We on future commerce talk a lot about culture, and I think internal culture is everything. It guides everything. It guides even I think what we buy, how we buy it, software we buy, how we choose things. Our prior experience guides how we think the way we structure our organizations is guided by internal demands, internal prior experiences. So one theme in the report is omnichannel organizations have to have these shorter iterative planning cycles. What are the cultural shifts that are required for these larger legacy organizations that need to shift? So that can have this always on agility that you're talking about, what has to change culturally?

Lauren Livak Gilbert (02:31):

I love the point about culture because I completely agree and a large part of this report is a mindset shift, and that starts with culture. And I think a big piece of that is more of a business owner mindset where everybody is one company working towards one goal. And when you think about being more agile, I mean, gosh, we can think about this in so many different factors, but when I think about planning cycles, I think the first thing that comes to mind if I put my brand hat on are things like business planning, strategic planning, budget planning, technology planning. And in order to be more agile, you need to make sure that you're educating those leaders on why you can't just go to your finance team and say, I want to change my budget. Every quarter, they're going to look at you and be like, goodbye. You need to explain, okay, we need to be able to pivot because hey, there's a new retail media network that came out, or hey, we need to go test and learn. So the culture piece I think is also that human element that we were talking about to explain why should you care? Why is it important to you and why are you so important to this? Every function needs to understand why they're important. In the broader picture of commerce,

(03:44):

Finance, supply chain, R-D-R-G-M, shopper marketing, they all have a piece in it. But if you're not explaining to them why they're I and why you need them to be on board and think differently, then why would they change?

Phillip Jackson (03:59):

Do you feel that there is more or less willingness to change in light of ai?

Lauren Livak Gilbert (04:09):

Oh, that's an excellent question. I think it depends on the function. I think there is a lot of fear.

Phillip Jackson (04:16):

Hold on. Say more about that. Are there functions that are more willing to change because of ai? Right now?

Lauren Livak Gilbert (04:21):

I think it is definitely more willing to change because technology is their bread and butter and they understand it and they want to learn and they're usually more interested in experimenting, so they might be more willing. I definitely think there might be some hesitancy around the creative and design side because there's a level of fear, which totally understand agents are taking away copy editors, they're creating imagery

Phillip Jackson (04:46):

Probably not for very long. It's not that great.

Lauren Livak Gilbert (04:49):

That's fair. But again, I think of it as an enabler and a lot of people that I talk to that are more future focused in those departments, definitely think about it in that way too. But that's why I think it depends on the function because it's still really new and it's kind of scary and people think that it's going to take away their jobs and they don't know how to use it and they don't know what the future looks like. And so again, back to human nature, we naturally have a fear of change. And so this is a big change. I would say the people that are working in an e-commerce or omnichannel role are more excited about it and they see the opportunity, but they're also usually more of the future forward thinkers who are digital first and are really in this world. So I think it really kind of depends on where you're looking in the org.

Phillip Jackson (05:37):

Just to opine for a second, isn't it strange how afraid of change we are?

(05:42):

Yes,

(05:42):

But humans, our key superpower is that we're extraordinarily adaptive,

Lauren Livak Gilbert (05:50):

We're resilient.

Phillip Jackson (05:51):

That's what we do.

Lauren Livak Gilbert (05:53):

But it's so ingrained. It's so ingrained in who we are. But I think if you think back to the start of humanity, it was scary and we have that fight or flight built into us and we haven't adapted that fight or flight mentality to the modern world.

Phillip Jackson (06:10):

I mean, if you don't have fight or flight in e-commerce, I don't know what you're doing. So just speaking like culture of agility, right? There has to be a ton of agility. You talked about the sort of one thing you just picked out was going to finance, being able to ask for flexibility and agility in a quarter basis because you don't know what's going to happen. Tariffs might come out of nowhere. Who knows?

Lauren Livak Gilbert (06:39):

New retail media network. That's a big priority.

Phillip Jackson (06:41):

Well, that's always going to happen. I think we could just plan for that. Now that's that's a fair point. There's going to be four more this year. We just have to plan for it. I'm kidding. But sort of not really. And is this covered really in this report? What is a fixed cadence for reallocation across RMNs or IT spend? Is there a monthly or quarterly or weekly reallocation, and who has the gavel who says, I approve these changes? Does that vary from organization to organization or does that vary from org structure to org structure as you sort of outlined these broad four structures of types of organizations In this report?

Lauren Livak Gilbert (07:28):

I think it varies org to org, but what I think is a best practice is a combination between IT finance and the business. The broader business, and I actually need to correct myself because when we think about it, it is part of the business and you're talking to A CIO who really gets it. They think about themselves as part of the business, but a lot of the lingo that is usually used is it versus the business, but it is part of the business. So I'm going to rephrase and say it's finance it, and then someone from either marketing or e-commerce side that I need to jointly make that decision

(08:09):

Based on a previous report we actually did around retail media org structures, we found that most people still have a yearly budget planning cycle because that's just the traditional way. But the second cohort was thinking about it more on a quarterly basis. But again, that takes a lot of change and that takes a finance team that really understands what retail media is, how it's allocated on the p and l. We actually had a CFO on our podcast the other day, and we were talking to him and he was like, it was really hard for me when I was talking to a marketer because I look at the p and l and that's the language I speak. It's not that they don't speak it, but they use different words. So I needed to understand how to translate what they were talking about to the p and l, and that took time. And so that's one of those changes that needs to happen in order to have an iterative budget planning process. Wow.

Phillip Jackson (09:01):

The P and ls vary from organ to org, right? Yes. That's

Lauren Livak Gilbert (09:07):

The language used, what they consider above the line below the line. Yes. It's kind of crazy.

Phillip Jackson (09:12):

Yeah, those are very cultural as well, right? Yes.

(09:19):

Is there a sort of an average tenure that you're seeing these days from an e-commerce leader or a digital shelf like leader that from an org to an org, are they extraordinarily tenured these days? They stick around for a long time, and how much are they able to take that culture of leadership from one org, maybe transplant it into another? Is that something we're seeing right now? Because I feel like the disruptor category has a lot that could bring to these new, and we see that a bit, right? There's some acquisitions and hold codes that I think have brought it in a bit, but I also think that there's the cross-pollinization of the storied leader could probably bring some rigor to the up and comers as well. I think it goes both ways.

Lauren Livak Gilbert (10:04):

There's pros and cons to both. There's definitely pros and cons to both. I would say one of the biggest challenges for organizations is when talent moves, and there is a lot of movement, I would say, in the digital space, but that's because that mindset shift hasn't happened, that you're not actually pulling digital and reinventing the way you're working and putting it into the broader business. That's why in part one, when I was talking about that organization that actually took e-commerce people and put them strategically into different parts of the org, then you're starting by osmosis to bring digital into every single function. If you just have a COE model and those people rotate out, then you're constantly reeducating and you're getting people up to speed and then you're moving backwards because they took all of the knowledge with them. So there is definitely a lot of turnover in this industry.

(10:56):

And there's also I think, going to be a talent problem soon because there is a need for a commerce leader of the future. And if we aren't very intentional about how we bring people up in that world, especially with AI taking away some of the more remedial tasks, how are you going to get a future leader who needs hands-on keyboard experience to experience it to get to that point if they can't do that, right? So I think there's a bit of that happening too, where HR departments really need to think about, okay, how can we be very, very intentional about getting these future leaders the right exposure, the right development, the right understanding of the broader business, even though they're going to be enabled by ai?

Phillip Jackson (11:47):

Maybe there's another thing to think about and don't know that this is covered in the report, but there's a function maybe level deeper that HR probably has to, is it a function of hr? I don't know. How do we give the context of the business to the AI so that the AI has context that it's operating appropriately? Whose role and responsibility is that it's role? Where does that belong in the org? That's

Lauren Livak Gilbert (12:16):

The question. I think that's a good question. I'm glad you asked that because when I was presenting this report to a brand, that is a question that came up and it's a double click that I'm going to deep dive into in another version of the report as I look at the kind of AI org model of the future. But in some organizations I think that will be it. But I do think that there's an opportunity for agencies to play a role in that as well.

(12:44):

How can they help to train the LLMs on brand guidelines, on brand voice, on understanding the business to be able to help support you in those efforts? I think it will start with it, but in the world of an AI enabled organization where you have maybe 20 agents, is that something that you can support internally? I don't know the answer to that question right now. You might not be able to, so you might need support from agencies and tech partners to be able to do that. I do think that there's a world as we move further and further into this kind of agentic future where all of these AI agents need to be able to talk to each other. So there has to be more of a common platform for that to happen. So there's a world where all of this is changing really quickly and there's going to be new types of technology and new types of roles that pop up right out of necessity.

Phillip Jackson (13:35):

That's right. Ones that we may not even be able to.

Lauren Livak Gilbert (13:41):

Yeah, a hundred percent

Phillip Jackson (13:42):

For sure. You said some are still operating under this COE model and in the crawl, walk, run, sprint agility at scale diagram that you have in the report, you sort of characterize that as being the walk stage very, I don't want to say it's almost a pejorative, but it seems to be very, it's very to the left of this,

Lauren Livak Gilbert (14:09):

It's walk to run.

Phillip Jackson (14:10):

Walk to run. Yeah, it's walk to run. It is walk to run. Yeah. It does span. It spans

Lauren Livak Gilbert (14:13):

Across. It spans

Phillip Jackson (14:16):

How many of those could get well positioned? How do they get well positioned to get to Sprint? And does Sprint really mean that you are fully, does Sprint imply that you are fully utilizing AI that you're, how does that really imply a usage of a certain type of technology or org structure, or can you deploy technology or have a certain sort of a change management to an org structure while still being in a more legacy style of operating model in a business? Is that possible?

Lauren Livak Gilbert (15:01):

I definitely think it's possible. It's great to put orgs on charts and in these beautiful maturity models, and we know in real life they don't actually fit into those. So there's different spectrums in terms of what you're thinking about. So I started talking about this in part one, but as I was going about this report, I felt like I was writing it for multiple different people.

Phillip Jackson (15:23):

I

Lauren Livak Gilbert (15:23):

Was writing it for brands that are not as mature and are trying to figure out what model makes sense, and a co OE model could make a ton of sense. Right now, I'm also trying to write it for organizations that are more digitally mature and trying to think about what is coming next. So

(15:38):

The COE model makes a lot of sense for a lot of organizations, and it could be the perfect fit for you right now. And even if you're in a co OE model, you can still be adopting AI and you can still be able to build those mindset shifts. What I would hone in on is how can you take that education and push it more into the business so it doesn't just stay within the COE? And one of the pieces of the report that I talk about is you need to identify what elements of omnichannel need to remain centralized and what can go back into the broader business. So for example, I think of something like content creation. It doesn't necessarily to make sense to have a content creation team on making this up, snacking and then beverages and then another function, right? Because then you're not getting economies of scale and you're also not using the right brand voice necessarily, like you're duplicating costs. So centralizing something like content development makes a lot of sense. Centralizing things like data governance also makes a lot of sense. You don't want one team over here in France saying, yeah, I think these should be the data requirements and then someone in the US doing something different. So there are elements that even if we're thinking of this reinvented org model of the future still remain central because it makes sense for their specific need.

Phillip Jackson (17:08):

So this actually gets me into sort of a mindset of asking a bunch of very specific questions around how we get to this new future when we're talking about this adaptive agile organization. We're talking about taking on more. It's effectively what we're talking about. I don't know. I know that everybody loves to do more

Lauren Livak Gilbert (17:43):

Obviously with less,

Phillip Jackson (17:45):

More with less. That sounds great. What change load in an org can you absorb on a quarter to quarter or a year to year basis? Can you quantify that? How many PDP updates or promo swaps or RMN onboardings or how much can you really do before quality starts to slip or your quality of life starts to slip, and how do you measure that and how do you sort of plan for it from an org basis so that you can manage the change in the organization to get to where you're trying to get to from a goal perspective? And I'll buttress that by saying, can you just hire into that change? Is that something that you, I think a lot of people just try to do that.

Lauren Livak Gilbert (18:38):

A lot of people just add headcount a hundred percent to try to get to that change. And that's one of those in the beginning of the report I talk about, we're at an inflection point, and at this point, you can't just add headcount. Think about where we are from an economic standpoint. You're not adding 15 more new people to your team. It's just now

Phillip Jackson (18:54):

Seems like the opposite.

Lauren Livak Gilbert (18:55):

Exactly. Exactly. Right. So that's not an option anymore, and that's why I think it's also kind of forcing this mindset shift. So that is a really important element of change management and org change. You actually internally need to measure the capacity for your organization to change, because we're talking about reinventing. Reinventing doesn't happen overnight, and it can take one year or five years, 10 years to be able to do that. But as an organization, and this happens at the leadership level, you need to understand what is your organization comfortable with? How do you deal with change?

(19:32):

How do you share this change? Is it at a town hall? Is it by the middle management? Are you doing education? How are you actually going to be implementing this change? And it needs to be very, very intentional because you're right, Phillip, you can't just say, okay, here's a new leader here. You're using these AI agents and we're removing all of this from your day-to-day work. Have fun. That's just too much change. And that's why in the report, I build out these key tenants and I suggest you pick two or three, start there. Start the ones that are maybe lower barrier to entry, but really high impact that you can start doing now and then build out your roadmap to how you get to that future and a future that makes sense for you and your organization. And that can be as easy as shared goals. Just make sure everybody has metrics on the same thing. That'll be such a big culture shift and it'll help push you in the right direction. So just try to pick one, go from there.

Phillip Jackson (20:33):

On the other side of it, can we cut red tape? Can we remove approvals? Can we remove some bureaucracy so that we can cut cycle time? I think that the question really here is we're trying to get things done quicker. AI isn't the only thing that makes things faster

Lauren Livak Gilbert (20:55):

And it's not the solution.

Phillip Jackson (20:57):

Well, I mean I'm being told it is, but

Lauren Livak Gilbert (21:00):

It's an enabler. It's a piece of the solution. If you put AI on bad data, it still doesn't work. Right?

Phillip Jackson (21:08):

That's so true.

Lauren Livak Gilbert (21:10):

If you,

Phillip Jackson (21:10):

Sometimes you put it on good data and it doesn't work, right?

Lauren Livak Gilbert (21:13):

Also true. But it's a piece of your toolkit that can enable you to do more at scale, but that internal transformation still needs to happen. So you said approvals. That's a perfect example. I've had a lot of conversations with this report with the legal team, and I said to them, I was like, okay, well, all of this needs to change really quickly. You need to be more agile. How are you adapting to that change? And a lot of the feedback was they were sitting with the brand teams and they were learning with them, and they were understanding what is the level of risk that we are willing to take and understanding, hey, it's less of a level of risk on digital because you can take it down where if it's on packaging on a shelf, you can't go to 17 stores and take all that product away. So really being comfortable with the level of risk and also enabling the teams to make those choices. So when you talked about in part one about the pyramid, it's kind of pushing the decisions down more toward the people that are doing the

Phillip Jackson (22:19):

Work. Let's talk a bit about continuous reinvention. There's this maybe a fear that continuous reinvention actually means just continuous disruption. We don't,

Lauren Livak Gilbert (22:36):

Unfortunately, yes,

Phillip Jackson (22:38):

We probably don't want that. Is there a way to internally help a team adjust to the continuous reinvention? I could set up a couple. I have a couple ideas. I mean, I'm ready. Tell me what are your ideas? There's just ways to quantify how we get there. We are going to do so many experiments in a month or quarter or we're going to run so many, we have a quota basically, or we have a set of pre-agreed kill rules. We're going to do this, and this is where we all culturally agree that this is where the buck stops or I don't know, proven things that when a campaign reaches this amount of spend and it's not a winner, we're done. That's the kind of thing to me that we can all get on board with because we all know what the rules of engagement are. It's when there aren't defined rules of engagement that teams feel like we are thrashing. And that is when it changes from reinvention to disruption and people feel like they don't, it starts to feel uneasy in an organization. I don't know what you think about that. How would you characterize it?

Lauren Livak Gilbert (24:06):

Well, I like that. The thread that I would pull from that is one unified strategy, and I talk a lot about that in the report. If you have one unified strategy with very clear goals, everyone can go and move at speed. If you have 15 different goals you're trying to achieve and people are confused about where they should be headed, that's when you really have a big challenge. But to your point about disruption, I think the way to think about org structures, and this is another, I've said mindset probably about 25 times is another mindset shift. You are not going to get to an org structure and say, okay, we're done for the next 15 years. We don't need to change anything. That is not a reality of the world that we live in anymore.

(24:48):

We are going to continuously need to evolve. If I write this report again in five years, it'll be completely different. So that is a huge change, especially for a large organizations that were probably structured the same way, operated the same way for a hundred years and are now going through that disruption period. But it's a muscle, right? Once you start going through change and once you start seeing these things, it can get easier. But if you don't have a change management team, an education team, if you don't have your leadership on board, none of this will ever be possible. But there's not this peak of a mountain where you put your flag in and you say you're done. It's a constant evolution.

Phillip Jackson (25:35):

I am sure this is, I, this is an amazing conversation. I know that we could probably talk about it forever.

(25:43):

Yes.

(25:45):

There's probably not a dedicated change management team. These sort of people that are, are contributing to other people in the organization, other areas of the organization, or are they

Lauren Livak Gilbert (25:57):

Sometimes there are are dedicated change management teams, and I have seen it inside organizations. Sometimes they sit in hr, sometimes they might sit in a center of excellence team, and really what their goal is, is one, to measure the change and two, to help facilitate that change within the different functions. So they're going and they're saying, Hey, we recommend that you do. I'm making this up like a lunch and learn, or you do a keynote by the CEO who addresses all of these different people and we're going to bring in this external speaker and you're going to be required to do this type of education. There is someone who's facilitating that because right now, today, Phillip 2025 e-commerce leaders are the change champions. They're the ones going on the side of their desk because it's part of their role to educate and to encourage the change and to bring people along the journey. But if you're not dedicating someone to that, it's always just going to be a piece of everyone's job. And we all know, just like with e-commerce, it can't be a percentage of a person. You need fully dedicated headcount to be able to actually do it right.

Phillip Jackson (27:06):

I think that that's a phenomenal way to wrap this up. What is one end cap we can put on this? If you had to take one thing away from a tactical takeaway from reinventing the org for omnichannel success, how do we do that? Get started today, aside from downloading the report?

Lauren Livak Gilbert (27:31):

How do we do

Phillip Jackson (27:31):

That right now?

Lauren Livak Gilbert (27:32):

Well go to digital shelf institute.org and then click on resources after that. I would say really sit down and think about your consumer.

(27:42):

Think about how they shop, and think about how you are working internally to be able to support that. It starts with a conversation and just try to enter the room without your biases and try to think of it as a clean whiteboard and build a picture of what the utopia could look like, and then back into what your reality is. That's where all of this begins. Don't start with, here's my org structure and here's all my boxes. Start with the consumer. Start with how you're going to reach them and what your brand means, and how you want that to emanate in all of the different channels that you work with.

Phillip Jackson (28:21):

I mean, just a question. How many organizations have you met that had perfect alignment between their vision of the way that they're structured versus their vision of how Zero. Okay. Exactly. That's just wondering.

Lauren Livak Gilbert (28:39):

But it's a very good exercise because I think especially if you work at a larger organization, it's very, very easy. Even from my days on the brand side, it's very easy to get stuck in, oh, this is the way we do it, just because it's always the way we've done, and you need to really get rid of those blind spots and really try to think about what the future could look like, and you need top down, bottoms up and cross-functional alignment to be able to achieve that.

Phillip Jackson (29:05):

It's brilliant. Thank you so much for letting me come on and ask you a bunch of questions about this. I think it's been great, and thank you for coming on the Future Commerce Pod too. If you haven't checked it out, I'd love for you guys, guys to go check out part one.

Lauren Livak Gilbert (29:17):

Yes, and thank you Phillip, for interviewing me on the Crossover Pod episode two. So thanks for having part one, part two. Everybody take a listen and thanks so much. Hi everyone. Thank you for listening to our Crossover podcast. Make sure that you check out part one over at the Future Commerce Podcast on Spotify or Apple, and please make sure that you download the report to get the full insight into how to think about omni org structures in the future. You can go to digitalshelfinstitute.org, then click on resources, and it is the first research report available. Thank you for listening.