Retailers make the best use of a key component of a great customer experience — store employees

One day in Arkansas in 1984, a 17-year-old high school basketball player named Doug McMillon took a job unloading trucks at a Walmart distribution center. He’s still there, only now he’s the CEO. And he’s not alone; a lot of retail careers began when a teenager took a part-time summer job working behind a counter (or loading trucks, or arranging merchandise, or keeping track of inventory) and discovered there was something special about this business.

Which makes it a little disturbing to learn that Pew Research Center announced close to a one-third drop between 2000 and 2017 in the percentage of U.S. teenagers with any kind of summer job; those who were working were more likely to be busing tables or tending a grill than working in retail. (Accommodation and food services was the only major industry that had more teen workers in July 2017 than in July 2000.)

With a digital workplace, companies can marry what stores need with what people need. The store knows who it needs, and it can send out a call to everybody who has those qualifications — and only those people.

That is not great news for retail. The industry needs talent; who knows how many could-have-been-great careers are lost because they never got started. The industry needs help, whether of the future-leader variety or not. And in an age where the make-it-or-break-it differentiator for retailers is customer service, the help needs to know what it’s doing: Associates and customer service representatives need to be able to provide customers with information on request. Above all, they need to know how to solve little problems before they become big problems.

In other words, they need knowledge and experience. The Society for Human Resources Management gives the turnover rate for the entire U.S. workforce as 19 percent, with an estimated cost of replacement per position of $4,129. Turnover rate for the retail industry is around 60 percent.

Getting back to teenagers, there has not been a vast uptick in family income in recent years. It’s not like these kids don’t need the money; if they aren’t holding down a part-time summer job, where are they? Some of them are where a lot of their parents are — navigating a strange new space somewhere between actually being employed and not actually being employed.

“They’re in the gig economy,” Will Eadie says. “They’re working, but they’re just more spread out than they used to be, so the numbers are skewed. They’re not even working what would be considered normal part-time. They’re working three hours at this company, three hours at that company, three hours at another, because they want to have a more flexible schedule than a traditional part-time job allows.”

HAVING IT BOTH WAYS

Eadie is vice president for sales and strategy at WorkJam, a company aimed at the intersection of employees, employers and schedules. WorkJam provides what it calls a digital workplace — essentially, a two-way communications medium that allows a company and its employees to talk to each other in something close to real time. One of its most heavily used applications is scheduling.

Companies in WorkJam’s target customer base — retail, hospitality, manufacturing, healthcare, distribution centers, call centers and financial services — all wrestle with the same dilemma. Their single biggest area of overhead is labor, so they try to deploy it in a pretty granular way. If a big electronics chain doesn’t have enough people to adequately cover the noon-to-eight shift on Saturday, it loses sales. If it overstaffs the shift, on the other hand, it’s spending money it didn’t need to be spending.

Meanwhile, there is an army of part-timers, some of whom were absolutely sure they didn’t want to work on Saturday, but — now that it’s Thursday lunchtime — have decided that, actually, they wouldn’t mind. Just to make it more complicated, a major brand is offering a big weekend promo. Now the store needs more associates on Saturday than it thought it would, but not just anybody; it needs people who are trained on certain products.

With most traditional scheduling systems, everybody in this scenario is out of luck. With a digital workplace, as Eadie explains it, companies can marry what stores need with what people need. The store knows who it needs, and it can send out a call to everybody who has those qualifications — and only those people. Meanwhile, the associates who’ve decided they’d like to work Saturday after all have announced their availability.

The store manager doesn’t have to get on the phone and call anybody; they look at who’s available, say ‘I want you and you and you,’ and click send. The selected associates confirm, and the shift is set. The other associates? They didn’t just let this one store know they were available, they let every store in the chain in their area know. The odds are good they’ll pick up a shift on the other side of town.

A SENSE OF BELONGING

“To get them back from the gig economy, you put the gig economy in your business,” Eadie says. “If I work in a big city, and the company I work for has six different locations within 20 blocks of me, why can’t I pick from them? That way I can get more work, and I don’t have to have a bunch of different jobs.”

Target Australia achieved major cost savings and shifted its focus back to the customer experience. Along the way, the company’s turnover rate dropped from the high 60s to the low 40s.

Which is good, because — at least from WorkJam’s point of view — people don’t really like the gig economy. What they want is a home. Eadie cites WorkJam’s recent experience with Target Australia; with 300 locations, it’s the country’s largest department store chain in terms of number of stores. Four years ago, Target Australia — no relation to the U.S. Target chain despite a similar logo and stores — reported a heavy financial loss, caused in part by overgrown internal systems and admin-heavy processes. “They were on a burning platform,” Eadie says. “Target Australia had to cut costs and increase sales in order to survive.”

Part of the problem was organization and communication. “They had the highest turnover rate they’d ever had,” Eadie says. “One of the first things they found was that the minute they started speaking at scale with their team members — here’s what our brand is about, here’s what we did last year to make things better for our suppliers, here’s what we’re trying to do for you to make your job easier and safer — they had a huge jump in engagement and job satisfaction.”

Over the course of three years, Target Australia was able to achieve major cost savings and — once the organizational backbone was in place — shift its focus back to the customer experience. Along the way, the company’s turnover rate dropped from the high 60s to the low 40s.

“We see ourselves as that last piece of the customer experience that so many of these companies haven’t thought about,” Eadie says, “the employees.”

March 26, 2019 / Peter Johnson / STORES: NRF’s Magazine

2019-03-27T09:51:03-04:00