Strategic Management

Harvard Business Case: E-commerce at Williams-Sonoma

Professor: Resan Kikava

Student:

Mariam Shereshashvili
Irakli Sikharulidze
Giorgi Tkebuchava
Doia Chakhtauri

Tbilisi, Georgia
2020

Assess Patrick Connolly’s effectiveness as a change agent moving Williams-Sonoma toward e-commerce.
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 1. What barriers did he face, and how well did he overcome them?

The scope of changing structure and embracing ecommerce would change company’s scale of investment on
ROI based model, but will not change commitment to building up ecommerce as a third leg to the stool.
Where under the online brand would be added three functional teams: Application development team,
merchandising team, marketing team their direction would control company’s business portal strategies,
web operations and product planning. In the process of restructuring Connolly was convinced that the
internet could provide new value to the company. This is why he dominating for assistance prophet brand
strategy in brand and ecommerce strategy. In his pilot approach was included website’s direction into
different ideas validation. Such as Mother’s day website which didn’t bring significant revenue, bur it
proved that customers would buy online. Wedding website development where site positioned as a value-
added service offering to customers who already had an affinity for the brand. Connolly always believed
that internet would have to be a big investment, where his style was very challenging. He had been
approached by several people about spinning out the internet effort as a separate company, with east access
to funds. Holiday websites where companies going online for holidays. Where the goal was to prove faster.
Where the biggest difficulty was getting new merchandise in when it ran out. And the operational readiness
plan called liaisons from each key functional areas (merchandising, inventory management, call center,
distribution center, database marketing and financial reporting). The technology side of new strategy
included several parts. For the consequences launching on time the result of wedding were good. It didn’t
met aggressive sales plan for reaching 30-35% of overall bridal revenues in first week.

Since Nandkeolyar wanted ultimate control over merchandising and inventory management began to look
into what operational barriers were in the way of creating a separate ecommerce inventory. Where
Connolly’s vision was. Adding it was a mistake when he was thinking that adding a third channel would be
easy, since they had much experience and success with two channels – retail stores and catalog. Also,
ecommerce is a direct to consumer channel. Where was lot of conflicts? Within the catalog division, they
had much of the expertise necessary to run this new channel, but none knew who was responsible for what?
Creative wanted to have total control over the look and feel of the site, inventory wanted to own the
inventory, MIS wanted to have the technology, the merchants wanted to have total control over what was
sold. Their decision was o move e-Technology group to the internet under ecommerce division. Where they
decided to Creative Service should have accountability for the look and feel of the site but work closely with
online business, marketing and merchant team to define the final customer experience and merchandizing
strategy. They leveraged the construct that exited in the catalog business to arrive at business solution that
was both innovative as well as designed to optimize team member contributions. Additional problem facing
ecommerce was merchandising inventory personnel financially demotivated. Where heads made decision to
compensate on catalog success as well 30% or more. They perfectly knew that shouldn’t worry about
catalogue or retail. Where he detected that performance needed improve. One of the barrier was brunt of
the deal simply because they wouldn’t be sharing information because they didn’t want Sapient to learn
their best practices. And Williams-Sonoma wouldn’t want to expose their best people to them, because they
might try to recruit them. This is what there a whole bunch of issues is when you try and take two firms
especially two competing firms and put them on a project together.

2. What were the key steps in his change process as the first champion of change?
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Patrick Connelly was effective as a change agent. It was he who examined the possibility of using the
internet to build business for Williams-Sonoma. He became the champion for introducing internet as a
channel for Williams-Sonoma. He overcame the initial resistance from the executive team. He built a task
force and got assistance from a local management consultant firm called Prophet Brand Strategy. Connolly
provided answers to Howard's challenge of making the project profitable.

He faced several barriers. The executive was not fully involved in the project, he persuaded them to back
the internet project. There was skepticism from Lester about the cost and the financial viability of the
project. Patrick Connelly swayed over Lester by showing him that the project would be profitable, and the
revenues would be satisfactory. There were problems when Cathy Hooligan suddenly resigned. Connolly
connected with Prophet Brand Strategy and agreed to accept their president as a temporary replacement for
Cathy. Finally, he persuaded Nadkeolyar, Shelly to join in and take over the position of Shelly.

The steps Patrick Connelly had to take as a change agent were he had to persuade the top management to
grant their approval for the project, he had to persuade Lester of the financial viability of the project, he had
to design and develop the internet organization, and get outside help to set the project on course. That apart
as a change agent, he had to trouble shoot when Cathy Hooligan left the company. He had to ensure that
the change was successful, the launch of the website was successful.

Most importantly, he had to ensure that the website would continue to perform well, continue to receive
the support of the top management, and not get into serious conflicts with other channels.

3. How well did Michael Dunn take up the challenge?

Michael Dunn was the president of prophet and before I will explain about challenges and his attitudes on
that, I will try to explain his position about wedding website. Fisr of all it’s important to mentioned that
Sonoma came to Connolly and said: ,, Let's take one issue and work on it well, I'm sure everyone will like it
and this platform will be convenient for everyone, it may not be very effective at first, but it is definitely
worth taking this initiative“, really important is the comment of Michael of this initiative, he thought that
this wedding site Positioned with value-added offers for customers who already know the brand and trust it,
as well as the idea that is now evolving is focused on making the roots stand firm, But if consumers aren’t
interested and don’t make the decision to buy it, it will still remain an idea that brides like and want the
most because everyone wants to be able to manage their wedding with a platform easily. According to the
November’s meeting in 1999, he presented business assumptions, reforecasts of revenue and some operation
expenses, he made some comments which were one of the core and reasonable, said that: ,,our organization
had a lot of capabilities to moving to the internet promotions, maybe call center, customer service report,
they know how to manage and handle and fulfill individual demand, but we have absolutely different
business processes, which need to be defined and distinguished with different prices, it means that once we
got seasonal businesses because it will be ready to meet new challenges and so support new channels”, all
the tools are mentioned above(also merchandising, inventory management, marketing and finance reports)
should be connected to each other. He thought that all important details about operations were included to
the plan which they have already presented during their meeting, and all the inventory team were waiting

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to just execute them. cause all the participation, Dunn was still the president of prophet and also become
Sonoma’s interim vice president of e-commerce. Connolly said about Michael that he had great knowledge,
leadership and people skills and he always knew what he should do.

Dunn had one of the important and difficult liabilities, maybe he should prepare capital budget, operating
expenses, sale plan, organizational designs, roles, also some kind of revenue forecasts, on which they rely on
their decisions, he always was operative and therefore their project execute on time.

Based on all of the above characteristics, I would like to point out that Michael responded to each new
challenge quickly and efficiently, calmly and efficiently, most importantly in a short period of time, which
is really difficult and time consuming, especially when you have important responsibilities and lots of
assignments. He was always operative and quick, and at the same time his decisions were trusted and
respected by all. His predictions or operations, costs and so on only needed to be implemented without any
adjustments, especially in a difficult, tense and challenging environment.

Thank You.

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