What does real digital transformation look like? In this engaging session from Prodacity 2025, Josh Kruk, SVP of Digital at Kohl’s, shares how to modernize legacy systems, balance short-term wins with long-term impact, and drive business value through technology.

From his background in software engineering and lean startup principles to leading one of the largest retail transformations, Kruk provides practical insights on aligning IT investments with measurable business outcomes—without falling into common enterprise traps.

🔹 Key Topics Covered:

• The real value of modernization—beyond just replacing old tech
• How to align business outcomes with technical investment decisions
• Why legacy modernization projects fail (and how to avoid it)
• How to manage smooth delivery across net-new capabilities & heritage systems
• Balancing short-term stakeholder needs with long-term strategy
• Smells in the system: How to spot the biggest inefficiencies holding you back

🕒 Key Highlights & Timestamps:
[00:07] - Introduction: Josh Kruk’s journey from software engineer to retail transformation leader
[02:15] - How Kohl’s aligns IT investments with real business value
[04:26] - Modernizing legacy systems without unnecessary risk
[06:03] - Why merging old & new teams accelerates transformation
[07:39] - Balancing speed of innovation with real-world constraints
[09:45] - Stakeholder management: How to drive change in a publicly traded company
[12:30] - Navigating short-term vs. long-term innovation priorities
[15:41] - The biggest leadership lesson from consulting to executive roles
[17:59] - The secret to overcoming resistance: Listening more than you speak
[19:37] - The importance of small, continuous changes over big-bang rollouts
[23:05] - What are the biggest technical inefficiencies you should solve next?
[25:31] - Final takeaways on global vs. local optimization in enterprise tech

🔗 Stay Connected:
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Follow us on X: https://x.com/Rise8_Inc
Connect with us on LinkedIn: https://www.linkedin.com/company/rise8/

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Bryon Kroger (00:03):

So can you just share a bit about your background and what you're leading at Kohl's right now?

Josh Kruk (00:07):

Yeah, you bet. Hey y'all. I'm Josh. I grew up a software engineer. I went to school for computer science. When I finally figured out what I wanted to do, had a really traditional career for about 13 years, writing code. First did a startup and then we got bought and bought and bought and bought and eventually I kind of ended up in this weird spot that was like, the company's failing, what do we do? And we ended up spinning a bunch of stuff off. And so my career really in my mind started there when I was like, ****, this doesn't work. You can't just write code and it's going to all be fine tomorrow. And so I got involved with a lot of what we would call lean startup today. There was a pamphlet that went around that had a bunch of techniques and it was the first business model canvas for what are you trying to do.

(00:50):

Since then, I've just kind of been saying yes to whatever random things people let me say yes to that let me do jobs that seemed like fun. So one day the phone rang, I ended up at Pivotal. I met you through that experience and started focusing a lot less on engineering and tried to focus on what do you do if you get really good at engineering, and then what are the things that around you that have to come out of the way to let that engineering provide value for the rest of your customer base or your business base, whatever you're working with. So currently I lead digital at Kohl's, so if you want underpants or pants online, we'd appreciate your business. We've got some Kohl's cash for you. I've been doing that job for about a year. I've had a whole bunch of different roles in it. We started a transformation there just over five years ago, so it's been a really wild ride. We've made a lot of progress and some really great outcomes that you'll hear more about tomorrow from a couple of speakers. But yeah, thanks for having me.

Bryon Kroger (01:40):

Yeah, and you and Siobhán are always too humble. You always kind of joke about like, oh, it's all mission oriented here and I sell retail. But I think that I've been really impressed watching the transformation because I think it is nice to start on the industry side and why we have so many industry speakers because there is such a clear tie, the mission ratio is profit. And explain to me how you've been thinking about modernizing it at Kohl's and some of the legacy systems specifically in relation to business value. I think that's where you all have gotten it right, that I see a lot of people get things wrong.

Josh Kruk (02:15):

Jason put the magic formula up in his talk. We have it pretty easy. We have to answer to the street as a public company and it's how much money did you make and how much money did you spend? And the better you make that ratio, the better off you are. Borrowing lots of like don't do horrible things to people, all of kind of the basics. But we're really fortunate because it becomes a very clear math problem for us when we start to figure out when does something smell right? And I think as technologists or certainly leaders in other IT organizations that I work, you tend to look for things that smell because they're old or because they have a company name that you don't fancy on it anymore. And maybe the more nuanced version of that is it has a company name that you don't fancy anymore that costs a lot of money because it's old.

(03:02):

But at the end of the day, that really only pays attention to half the equation. And I think where we've had not an easy time of it by any stretch of the imagination, the work is very, very hard. But where we've been very thoughtful is we think about what we try to modernize or what we try to migrate or what we try to just iterate in general, we're really focused on what is the in-state value of that to the point where we have a set of practices inside the organization where we start and say, if we're to do this, what do we propose to get for it and how does that then help us do the next two or three things And we're not perfect. It's great because you'll stand up here on stage and anybody on my team who's watching this right now is like he's full of ****.

(03:42):

But that is the idea that we start with is what is the outcome that you want and what is that outcome worth not just to Kohl's but to the customer that we're serving or if you work on a ERP system, your end user to whomever you're really thinking about. And that's guided a lot of work for us that I think has helped really manage how much work do we try to do at once and then what does it mean to actually be done with something. Once you've achieved the value, you are forced to say, should I continue with this? Anybody who's done a big legacy system retirement, you get to about 80% and you're like, I got another five, six years ahead of me and I've already been working on this for twice as long as I said I was. So that's helped us think about it a lot. It's not a perfect system, but it's a place to start.

Bryon Kroger (04:26):

And going to what Nick was talking about just now, how are you thinking about smooth delivery across net new capabilities and some of the heritage systems? I assume you have quite a few of those and they drive a lot of business value today.

Josh Kruk (04:43):

So I have it actually really easy in the e-commerce world, most of my stuff is not that old and it's not that bad, which is anybody who works in digital retail, that's kind of just your state of affairs if you're still in business and competitive. So when I look at it from that lens, really it's not even about smooth service delivery, it's just how do we continue to iterate forward and iterate forward and iterate forward. And you think about making changes to the basis, it's a thing that's constantly in motion. It holds us back sometimes, but mostly we're able to not have the conversation of like, oh, we're going to bite off a giant chunk of something and ****, tomorrow there'll be a totally new system. We're able to mask that from the user and hide it. And whether we're doing that through an API abstraction or shims or somebody said the Strangler pattern seven, eight times on stage today, right?

(05:27):

There's a reason we all say it. That's pretty easy. When you get into the guts of some of these, we talk about mainframes, that's way harder. You got to be a lot more thoughtful and I think there's some old school classify what you're trying to do, anything that works on that input and output principle that you can say I need the same input and I need the same output and that'll carry me forward. The strategy of pick that thing up and move it and do it in a way that's really safe and secure and you can bring in all of these new practices we've built in the last 30 years, it's ace. That's the way to go. Anything that you're going to have to change how it works to change your business, you really got to look at more thoughtfully. My advice there, to the extent that is practical and I would say practicality ends at Cobalt, have the team that is building the new thing, manage the old thing and bringing that pain into a single group of people, which we all operate in environments of scarcity and we all think our environment is the most scarce.

(06:27):

So I'm going to sit up here and tell you I run a pretty big e-commerce business with a very small number of software engineers and the things that have been successful in our organization the most reliably are the ones that have the people in charge of the new thing and the old thing at the same time, the things that have taken the longest and been the biggest disappointment both in my current company as well as my whole career are the things where we have a group of people with an old thing and we have a group people with a new thing and we are somehow hoping and praying that they meet someday and maybe the person who we're going to subject that nightmare on can cope with it.

Bryon Kroger (07:01):

Do you have a name for that? Is that reverse dog food? I don't know what to call that. I don't got a name. So how do you balance? I think what's interesting, and this happens in a lot of government missions too, is eventually the software turns physical. So you have retail brick and mortar stores and you have an employee experience to manage and the shopper experience similarly, I mean the VA mission that eventually touches clinicians and veterans DOD gets very real very quickly. How do you think about balancing the speed of innovation versus the real human changes that have to happen in the business alongside the software changes?

Josh Kruk (07:39):

Yeah, I believe the secret to that is make lots of little small changes. I think the example of the cell phone is wildly overused here, but there's truth to it of the apps on our phone change every day and most of the time they don't change in massive ways. So when I think about a retail associate on the floor, that's the strategy that has largely been successful as we've changed. How do you receive off of a truck or how do you look up product information to help a customer who's trying to decide this blender or that blender, right? Little changes there tend to get unnoticed and tend to make things better and you don't have to do a massive amount of change management. Where you get stuck is software is a symptom of much larger disease sometimes. So if you think about the way in which you manage an ERP system or a general ledger, you've built lots of human processes around that piece of software and that's a much tougher game I think.

(08:35):

I don't know if anybody's found the successful strategy for this, but if you have, how do you reimagine the process and build the software you need to do the thing you want to do rather than how do you iterate software to make changing from the thing you already don't slightly less painful into a new thing that you don't like? It's tough. That was the beauty of being able to do greenfield development. A lot of these startups is you get to start with a new project, but that hasn't matched real life in my experience, and it is just the painful do it wrong enough times until you're willing to start over and then you'll probably get somewhere.

Bryon Kroger (09:07):

I think one thing that is underestimated when we look to industry in Govtech, we often think, oh, our stakeholders, I mean literally an act of congress to get a budget going to the Pentagon, whatever it might be, these can be really difficult stakeholders, but I think in some ways Wall Street or being a publicly traded company has an even larger stakeholder map in some ways and it can be very challenging in its own. So how do you think about some of these changes that you need to make, especially when there's long, I don't want to say feedback loops a long time between investment and ROI and keeping people along for the ride and staying invested.

Josh Kruk (09:45):

I mean first off is the practical answer I think of break it down into a small chunks as humanly possible and get it out there in front of people as humanly possible or as fast as humanly possible. And then learn from them. You go from, let me inform you about this work that I've done in a dark room with headphones on to like, no, your marketing associate is using this new thing that we've built and it's like one small slice of the thing. Maybe it's through a certain piece of a planning process or at a retailer it's pretty easy for us to break things down by category, so do it in home, do it in women's, that kind of thing. I think the first thing that's pretty helpful there, the other, I hadn't thought about the lean metrics book in about a decade and I was sitting up there, I was like, oh my god, that's what I've been doing wrong with something over the last week.

(10:32):

But that's probably the other thing is if you have a lot of clarity on what are you measuring and how do you demonstrate progress towards that thing in a meaningful way, ideally in the real world, but even through piloting and user testing and things like that, that tends to get a lot easier. Managing long lead times, anything in my world, if it's going to take you more than six months to get something that you can see in the real world, you're probably just doing the wrong thing. The market will have moved, there won't be value there by the time you're done. And so I try to look at it through that lens. That's not the same as everybody else. I don't have embedded software in my universe. Certainly people at Kohl's do that is really hard to change in a robot that's moving packages around. So that's where I have a lot of flexibility for the folks that do have those types of constraints. I think it is like pick a lane in the warehouse, pick a category, pick a very specific thing and get something out as fast as you can and make progress that way rather than bundling up a bunch of change.

Bryon Kroger (11:34):

I like that. Do you find that there's a lot of us that become purists, especially as we get removed from the process on measuring some of those things like long-term versus short-term. And I have found that to successfully move in the enterprise, you usually have to actually make some overtures to some short term to keep that cycle going when you might prefer to be long-term. Famously Eric Reese, after the whole lean startup thing, some of those companies didn't perform well and he said like, Hey, we need a long-term stock exchange. I don't think that's going to happen anytime soon. So how do you navigate short versus long-term when you know should be focused on something a little bit more, but to keep stakeholders and keep things alive, there won't be a business if we don't create this short-term impact, is that a trade off you have to make

Josh Kruk (12:30):

Is usually the opposite direction. So from a public question or excuse me, a public company, we are Ansible to the street right now. We might not get a tomorrow if you play it all out for how it works for a lot of people. So we're usually in the how do we get to focus on the things that we think are going to make us valuable for the longterm or are going to create value in the longterm. And our solve for that tends to be like, how do we document where we want to go? Very clearly, somebody mentioned one pagers, that's largely how we do it in our organization. And then how do we talk about the steps that we're taking to get there? The thing that works I think for me, not necessarily for everybody, but it has worked very well for me and my interactions with stakeholders and people in the organization I have to work with is we try to get as clear a picture of the end state that we're very, very interested in and how we would measure it and then we work on the very next step towards it and we try to keep everybody out of the middle.

(13:28):

Nothing you can do about the things that might happen until what happens, get it in production, learn from it. Most importantly, watch how a customer reacts to that thing and then take the next step towards the vision. And that process didn't happen overnight. A lot of people had to work together and become very comfortable with candidly, there is no plan. The plan is to go out and learn. And if you can learn faster than everybody else, I'm sure this has been said, right? If you can learn faster than everybody else, you're going to do better than everybody else. We don't get it right all the time by any stretch of the imagination. That's where we're aiming at. And as we get people comfortable with that and earn their trust by producing a result and that result is usually either measured and we made more money or we did the thing we said we were going to do and we caused as little strife as possible in the organization to get it done, you get a lot more rope. What you don't get to do is show up on the first day. Tell me if anybody's ever done this. Oh my god, I have all the answers to every problem. Let me tell you them right now.

Bryon Kroger (14:29):

That's a good segue to asking you about your past consulting life to, I mean you were literally in the seat advising people on how they should approach these large scale changes from an executive perspective. Now you are that executive. What's changed, if anything, about how you think about these problems?

Josh Kruk (14:53):

Some of you, there's somebody who's known me a very long time in the front row that I can't stop looking at. I've probably matured quite a bit in my understanding over there is more than one way to get to an outcome and letting go of that path as long as that I see we're making progress. At least for me, what's changed the most is it doesn't matter what company you work for. Companies have playbooks and they have a way of doing things. And the more you become passionate about that and believe in that, the more you'll try to enforce that. And then you get really rigid, really dogmatic, and you might as well sell unsafe to somebody at some point. Sorry if you do that, it is what it's, and for me that's probably been the biggest change is realizing where I was like, ah, my thinking on something was pretty rigid

(15:41):

As a leader in an organization where I can't possibly know everything that's happening all the time, nor can I influence the way in which people behave all of the time exactly the way I want. Being able to see the guardrails and pick the things that matter the most and then enlist as much help as you can inspecting that across all of the organization. And for me, that's the biggest thing, right? There's not a dashboard that tells us that. I really wish there was if anybody knows how to do that, but what's in people's hearts and minds in terms of how they're going to deliver software and interact with their employees. That's the thing I've realized since being a consultant is way more important than whatever process we were trying to build.

Bryon Kroger (16:21):

And maybe another difference now that you're in this seat is used to consult people, then they would have to go back to their organization and try to make these things happen. Now you are the one that has to do that. What have you found really works to overcome resistance? Tons of people in this audience are facing all kinds of resistance to everything we've talked about today and will over the next two more days, what's one thing that they should focus on to start making progress?

Josh Kruk (16:49):

Listen more than you speak. I will get nowhere if that person that you're sitting across from the table from or the boardroom that you're on the video screen in front of, doesn't feel like you've heard what they have to say. And that's actually not about you, that's about them. And so that I think is probably the biggest thing that I see that makes a difference both in my own how do you get started, how do you get momentum? But also most importantly, how do you keep it going because you're going to leave your first 15 meetings and everybody's going to walk out and feel great mostly based on whether there was a fight in the meeting or not the actual output or the outcome of it. But that's what I think the biggest secret is to keep going is making sure that every interaction that is humanly possible where you can ensure that person felt heard, who came up with a concern, and it usually with that won't work here, let me tell you why that won't work. Or this is broken or your person did this. That's really, really important.

(17:59):

And as much as you can get your head around that is going to be the differentiator for whether you can do the next 10 things and that person's going to come with you to do the next 10 things or that organization or you just put up a roadblock that's going to actively fight you if you can get through that and the organizational politics of it, I think there's lots of great things that can be done across any industry otherwise I think we're going to spend a death on frameworks and business cases and that kind of stuff that gets us nowhere.

Bryon Kroger (18:30):

Yeah, that's a good word of caution for everybody too. A lot of times you leave these events with a whole bunch of new ideas that you're really excited about and then you go back to all of those stakeholders and just talk, talk, talk, talk, talk, talk. And they don't want to hear it. They want you to hear them.

Josh Kruk (18:45):

And maybe we could talk about that for a second. One of the techniques that has been useful for me and as I look around, it doesn't really look like it's a lot of our first conference or anything, but none of these things work in the real world or in your real world. They will on stage for the person who told you about them, but trying to put together a bag of tricks and think about if I got a hand at a set of tools at this conference, which one might help me make progress in a very specific situation over a very specific period of time rather than let's institute a new process. Company-wide is a pretty useful way, not just for you to take something away concretely, or at least I believe that, but also you've all got folks you work with or work for. You teach 'em those one things and the scenarios in which they're useful and use 'em as force multipliers.

Bryon Kroger (19:37):

It's actually interesting because as we structure the agenda for this conference, I usually work from strategic to tactical across the days. So day one is a lot of strategy, there'll be more of a bridge tomorrow and then day three is a lot more tactical. Curious to get your take on this now having come from the consulting side of it, now being on this side is in regards to what you just said, what's the one thing I can go back and do? I think a lot of folks will start with the alignment. Let's get everybody aligned on goals, which is very much how safe ends up getting implemented. Where we have agile release train architects, we have 12 of those, but we have four software developers. And so actually my advice to everybody would be to start at the opposite end of this, which would be what's the one thing you can take back is establish continuous delivery as quickly as possible so that you can push out the first unit of value with people. So going back to the culture change this morning, like one-to-one change behaviors, start the culture change and work your way back up to alignment. There's a lot of people that violently disagree with me that are like Brian, then what if you ship terrible software and it doesn't solve the mission problems? And I'm kind of like, well, you could also come up with a whole bunch of unvalidated hypotheses that you haven't tested, which is equally risky. Which is it? Or is it middle out A or B?

Josh Kruk (20:57):

Actually I would agree with you and I think there's an and to it. Everybody who's been exposed to the agile one-on-one sees sees that you get the soft tooth diagram where you build up a bunch of risk and then it goes down and you build up a bunch of risk and it goes down and that's your 18 month release cycle or your capital planning process or whatever point the person's trying to make with that graphic. Or you do this and you get a bunch of little things and that allows you to de-risk stuff. So in this scenario you've described here, and maybe the one thing to take away continuous delivery is important because you can put something in the real world really, really quickly and if you're wrong, you can then deliver again and pivot and you have to get good at both of those things because it doesn't really do you any good to have a supercar with no wheels, but you can't do one without the other. As a practical example, while we were sitting up there earlier today, a team in our organization tried to deploy something and it didn't work.

(21:56):

The proper bells went off, blah, blah, blah, blah, blah. Before anybody had even gotten far enough to create an incident, they had fixed the problem in production and we knew the impact of that change and we moved on to the next thing, small, teeny tiny example, which maybe you hear and you're like, we couldn't possibly do that, I promise we did it on a live e-commerce site middle of the day. It was no big deal. But that's the kind of thing that you got to get used to and why continuous delivery is important and then getting other people to see why it's important so you're not dead in the water, you're not spending six months validating change it takes five minutes. All the stuff that comes from that.

Bryon Kroger (22:29):

And then tying this to the earlier questions and nick's talk, assuming you have that continuous delivery pathway, you have to start focusing on what are the next most valuable things for us to align on. I want to go back to the signals, I think you said smells actually. You find things that smell. What are some practical things people can be looking for at more of a technical level but still focused on business outcomes of the things they should be thinking about solving next when you have that messy middle

Josh Kruk (23:05):

Structure that thought? Okay, so first off I think about work in progress. How much can you actually do at once? Because the easy thing to do is go find everything that's smells and try to do something about it and you make progress. So I would forcibly limit yourself to the number of things you're going to try to fix at once is number one. And then I would look for maybe two, three things. How many people have to talk to deploy a piece of software? How many people have to talk to build a piece of software and then deliver a piece of in value to a user? Or how many teams get that to one for whatever you're deploying the most frequently or whatever you're working on the most frequently. Often that will point to you have teams that are structured kind of funny and one can't make a change without the other one.

(23:53):

Or if you take the microservices gone wrong talks, you're just tightly coupled, go fix that problem. That's the smell. The other thing I would really look for or that I often look for in the ecosystem is what are we working around consistently and then how do we stop working around it? So one that you deal with pretty commonly in e-commerce is consistency, right? So if I have a cart and I have a fail over event, that cart has to represent itself the same way or at least everybody believes that on the surface. And then you start, why? How often does that happen? Is it really important? Do you really need a cart? That's up to the second and that's where I would say start pulling back on things. Your solve might not actually be technical, it might just be rethinking what you're doing and becoming okay with a different set of constraints. But those are the things, if you've ever read the goal looking for the next constraint in the system is kind of maybe the deeper pattern behind that.

Bryon Kroger (24:51):

Yeah, there's so many great examples in that book and I think innovation teams fall into this trap a lot where you've locally optimized and I think the example in the book was they had gotten some robot automation for manufacturing some parts and it completely blew their old system out of the water, but then it caused all these storage costs

Speaker 3 (25:12):

And

Bryon Kroger (25:12):

It actually costs them more money than they saved. And I think that's easy to see when you're measuring dollars in versus dollars out. I think mission focused folks, it's hard to see when you've locally optimized at the expense of global optimization. And I think it happens more frequently than is understood. So I love,

(25:31):

That's actually a great note to end on, I think. I really appreciate you coming and again, I appreciate, I was serious. Josh showed up and him and his team, they gave us some tough love as a leadership team. I mean that kindly and it was exactly what we needed and I would tell you one thing is to have those people in your life, A lot of you on the government side are working with contractors in some form or fashion, but having some independent body that can come in and give you that type of not coaching or consulting, but just really like, Hey, this is wrong. This is what you need to be focused on. Here's how you should be thinking about some of these problems. It completely changed how we organized, how we thought about our problems and so I'm forever grateful for you. You really changed the way that I view a lot of these problems and really appreciate you coming out.

Josh Kruk (26:22):

Thanks for having me, man. I appreciate it.

(26:24):

(26:24):

Thanks.

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