The CEO of $24 billion Chewy reveals the online pet retailer's new fully-automated warehouse and explains how the firm is making every employee 'an evangelist for inventiveness'

  • In just over two years since he began leading the company, Chewy.com CEO Sumit Singh took the online pet retailer public, doubled revenue, and helped the firm top a $24 billion market cap. 
  • That success can be attributed to a laser-like focus on innovation, which is reflected in Chewy's first fully-automated distribution center slated to launch in October, Singh says. 
  • The new facility will use robots to pick, pack, and ship products — ultimatley resulting in 30% less costs, according to Singh. 
  • "Innovation, inventiveness, and speed to execution are the only true assets that an organization has," he told Business Insider. 
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Exclusive: Chewy's CEO on the $24 billion online pet retailer's new, fully-automated warehouse and how a culture of innovation helped support the milestone

The CEO of $24 billion Chewy reveals the online pet retailer's new fully-automated warehouse and explains how the firm is making every employee 'an evangelist for inventiveness' 

In just over two years of leading the company, Chewy.com CEO Sumit Singh took the e-commerce site for pet products public, raised its market cap to over $24 billion, launched new business lines, and doubled revenue to $6 billion annually.

Underscoring those accomplishments is a laser-like focus on creating a culture of innovation, Singh says, one that aims to enable every worker to contribute (not just leadership) and that includes significant investments in emerging technologies like artificial intelligence. For example, Chewy uses AI to help manage demand forecasting, supply planning, and other tasks, which has translated into needing only 100 supply chain operations employees, which Singh says is far less than the typical 250-person staff that would oversee the critical function at similarly-sized organizations. Another soon-to-launch example: The firm's first fully-automated warehouse.

Chewy, which PetSmart acquired in 2018, maintains this culture of inventiveness by encouraging technologists within the organization to work arm-in-arm with employees within the individual business units — an increasingly common set-up that has been shown to cut-down on production times and increase output.

"If business has the audacity to dream a dream, then tech has the courage to deliver it," Singh told Business Insider in an exclusive interview. "Innovation, inventiveness, and speed to execution are the only true assets that an organization has within competitiveness. Everything else can be copied, or emulated, or marginalized over time, but trust and inventiveness and speed of execution cannot."

Singh has also had to adjust his own leadership style to make sure employees feel empowered to both move quickly and make mistakes along the way.

"You have high demands, but it's also important to balance that with the right level of patience," he said. "Otherwise, you run the risk of burning teams into the ground or you run the risk of demotivating talent along the way."

Business Insider talked to Singh to learn more about how he overhauled the culture at Chewy and his ambitions for the future of the firm as it competes head-to-head with giants like Amazon. 

Creating a culture of inventiveness 

Similar to Amazon and other companies, Singh has strived to create a culture within Chewy where risk-taking is encouraged and failure isn't a word that employees fear.

Of course, that's easier said than done. And while that is a message Singh continually touts internally, he says it takes more than a proclamation from the CEO to make it possible.

At Chewy, leaders encourage employees to openly debate ideas — a practice aimed at empowering even the youngest members of the organization to have the confidence to challenge the status quo.

Every three months, the leadership team comes together to publicly recognize individuals within the company that are pushing innovation within areas like customer service and customer experience. Chewy also hosts regular hackathons, guest speakers, and other events that help extol the benefit of technology like AI and educate workers on how to use it.

"Humans are very good at creative thinking and problem solving one problem at a time, but when you are dealing with repeatable scenarios at the scale that we operate at, technology partnered with smart humans is the better answer," Singh said. 

In the past few years, the company has also poached senior leaders from organizations like Amazon, Wayfair, Google, and Facebook: businesses that embody the culture Singh is aiming to cultivate.

"I cannot just shout it from the rooftop. I can do that all day long, but I need evangelists. We need more leaders," he said. "We need to duplicate and multiply at a rapid pace so that every person inside the organization is an evangelist for inventiveness."

Setting the automation standard

Much of that culture is embodied in Chewy's first automated warehouse which is slated to begin operations in October.

When initially conceiving the idea, Singh eschewed the use of consultants or other external resources. Instead, he asked the operations chief to assemble an internal team of engineers, ergonomics and safety specialists, and other experts to oversee its creation, pulled them away from their day-to-day roles, and gave them full autonomy to work on the project.

Overall, it will be Chewy's tenth fulfillment center and will employ 1,000 people. But apart from being the company's first facility that will fully-incorporate automation, Singh says it's also the pet industry's most advanced building to-date.

"We will leverage smart robotics and cutting edge technology to pick, pack, and ship products with speed and precision," he said. "You should expect a multi-level floor plan, each level connected with smart conveyors and routing logics."

Apart from the operational gains of using robots to retrieve items and ultimately help send out packages — Singh says capacity will increase 25% compared to Chewy's other facilities while reducing costs by 30% — the machines will also be energy efficient, with 10 of its robots utilizing the same energy as one vacuum cleaner.

Ultimately the warehouse will set a new standard for Chewy moving forward, Singh said: "You can definitely expect a greater degree of automation in our future launches as well."

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