How Customer Experience Factors Into & Benefits From Efficient Labor Utilization

The goal of business strategizing is to remove as many disruptions or unnecessary factors when building your recipe for success. In many retailers’ minds, customers are one of these disruptions. Hate to break it to you, but that is actually the opposite case. Customer satisfaction as a result of interaction with your business is not only a crucial part of calculating labor utilization rates but an integral measure of overall success.

 Is this news as shocking to your business equation as cold water to the face?

Not convinced yet? Here’s the deal:

The Valuable Variable: Customers

The shadow from over the horizon coming to threaten the well-being of the brick-and-mortar retail store is online shopping. Heck, we get it. It’s fast, easy and you don’t have to deal with any traffic or crazy drivers to get to what you want to buy. For retail to continue drawing in physical bodies to a physical location, an in-store experience must be executed that is just as easy as online shopping, with even more benefits. What benefits? Human interaction and personalization. Human interaction is what distinguishes a brick-and-mortar store from online shopping. To continue competing with a growing internet convenience, retail businesses must consider retail customer interaction as an additional dependent variable in the workforce planning, labor utilization, and labor standards equation. Still don’t think this is an issue? Think again, even Forbes has noticed. Yes, that Forbes.

 Provide world class customer experiences and you can even get someone this excited about a computer to come in to your store!

Knowing What They Want

When adding the new variable of customer satisfaction to workforce planning, the key factor comes down to simple specifics: learning what is relevant to your target audience and how to enhance their customer experience through those specifics areas of importance. Take, for example, apparel and department stores. These retail markets are very driven on customers feeling like sales associates wanted to help them find what they were looking for and wanted to attend to every need they had while hunting for that perfect pair of jeans. Therefore, workforce planning for these markets needs to be built around sales associates mastering the ability to connect to the customer, listen to what they need, and assist them in a friendly manner.

Constructing workforce planning around the specificities for your businesses market is imperative for increased revenue. Customers are willing to not only pay more for a product, but shop for that product more frequently if they feel that their top 3 benefits of their retail shopping interaction are being met.

How to Give Them What They Want

Well-instituted Engineered Labor Standards provide your sales associates the most opportunity to interact with your customers and fulfill the part of the equation dependent upon their satisfaction. Labor standards make your employees the most effective and efficient possible. You want your management team to be able to mentor your sales associates, AKA your front line for sales. Reaping the benefits of one-on-one meetings and coaching allows store associates to give the proper attention to customers to drive sales.

The purpose of labor standards within retail is to streamline processes to make the most of company time and effort. This is directly intertwined with customer interaction. For example, let’s examine the ever-present delivery process. Your business constantly needs new product and merchandising to stay ahead in the retail game. Although a delivery is an undeniable necessity, the timing of the delivery plays into the variable of customer satisfaction. If a delivery arrives during peak hours, your sales associates can no longer exclusively focus on customer experience, thus negatively affecting satisfaction. Divided attention leads disappointed customers, and no business wants that result.

Streamlining processes such as deliveries to coordinate with a labor utilization schedule around peak hours allows for retail customer interaction to remain the primary focus. Efficiency and effectiveness are maxed out when the focus is on the customers when they are in the store, and the focus is on the product when sales traffic is down.

How to Make Them Want More

While labor standards with the necessary customer satisfaction variable in place provide the processes to allow for maximum retail customer interaction, labor utilization with this variable included allows for the opportunity to have a satisfactory outcome. The outcome of an equation is just as important and the variables involved, and customer satisfaction is both a variable and necessary outcome.

Having this variable included in labor utilization is incredibly important in regards to staff scheduling. Optimization of sales associates for peak hours is crucial to making sure customers feel attended to, important and acknowledged. Conversely, too many sales associates without enough customers leads to less productivity on the part of the employees and more company expense.

Part of a successful equation is the ability to maneuver variables to balance all terms. Therefore, your business needs to be flexible with scheduling processes to figure out when it is most effective to have maximum staff, when can minimum staff be utilized and how long shifts need to be. A willingness needs to be built into the equation for change to find the best formula to use. There can be many ways to solve an equation, but some ways will always be more effective and efficient than others.

 Successful equations with defined variables aren’t just for mathematics.

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Moves to Maximize Labor Productivity

Managers are tasked with making sure that their employees are doing their jobs at peak performance. From an operational management position, macro management must be utilized to maximize productivity. The largest concept that a successful operations manager needs to grasp is engineered labor standards. This simply means a defined time value that represents a team’s peak efficiency. No one magic formula can be used to create this standard for every business, but there are ways to define it by looking at different factors in your own business, so that you can come up with your own workforce management formula. There are three things in particular that can help you get started and maximize your labor dollars.

1. Know your business

This sounds like general advice for anyone running any type of operation, but it is more than just knowing what kind of products you produce or sell. It is about knowing how much time or effort each process entails within your production line.

 It isn’t just about general knowledge of your business, but knowing the processes as well.

For example, let’s say you are the operations manager of a small, fast food chain. Of course you know your menu. But as an operations manager, you need to know how long it takes a burger to cook. You need to know how long it takes to assemble. You need to know how long it takes to bag. And finally, you need to know how long it takes to get from the cashier to the customer. By knowing this, you can figure out how many people you need to have in that production line to get that food from the grill to the customer in the fastest way possible.

2. Create the Workforce Management Standard

Once you have a grasp of how much time a staff can have an activity done, you can create a standard. For example, if five people can have it done in three minutes at 20% labor costs, but four people can have it ready in four minutes at 16% labor costs, you choose the latter. That is now your new standard.

This is one area where macro level management intersects with day-to-day management. You have determined that a job requires this many people and this amount of time to accomplish. Now it is up to your management team to make sure that level is maintained or surpassed on a daily basis.

3. Automation Cuts Down on Lost Time

 Using computer-based time clock management can

save money and increase productive labor hours.

The final thing is using automated systems to manage labor. This means employees clocking in and out electronically. This can lead to huge savings, because it cuts down on inefficiencies at the time clock. Paper time sheets can be lost a lot easier than a computer-based system running redundancies. It also means that your team can watch labor in real time, and make adjustments when appropriate.�

The overall idea of productivity, as it relates to a company as a whole, can be a tricky concept to understand. Numerical quantities such as sales figures, percentage of labor against sales, turnover percentage, production costs, and other figures are all factor in what a company decides is an acceptable level of productivity. Successful business are able to control those quantifiable numbers to produce positive results.�

If you are looking to take your productivity to the next level, you should contact us at Connors LLC, so that we can help you design a robust, successful plan.

RFID: Is it Right for You and Is it Time?

RFID is a very divisive technology, with companies weighing the benefits of its automated potential against the potential privacy concerns involved. In reality, most of the original privacy concerns are no longer relevant, but companies are still wondering: Is RFID right for us? While the answer varies from company to company, here are four circumstances that make RFID worth your time and money.

You Have Many Containers to Track and Ship

One very specific scenario that may make RFID worth it is if you have a large amount of containers to track and ship via a warehouse management system. RFID aids inventory management by allowing you to track the containers comprising every link of your supply chain, and you can use active RFID tags for real-time tracking in the docks, yards, and other locations. This technology is able to improve your efficiency and accuracy via speedy identification over very long distances.

You Need to Improve Your Distribution Process

Another specific scenario that may justify your use of RFID is if improving distribution processes is a high priority for your company. Use of RFID has the potential to use tagged products and RFID read-write equipment to register tags and send information to your warehouse management system immediately. This helps in the placement, sorting, and dispatching of products, resulting in improved delivery speeds with increased efficiency and decreased costs.

You Have Time to Get It Right

Many look at RFID as a technology that will immediately revolutionize their business. However, like all technology, there is time and a learning curve involved. It requires extensive research into your existing inventory management system to identify which processes need improvement, and you must anticipate future business trends and changes in your own future practices that may necessitate RFID. To do this right, you’ll have to consult business management, stakeholders, IT, maintenance, and your actual end users. After deciding to adapt RFID and learning how to effectively use it, it can be revolutionary … for those who have the time to invest.

You Have Specialists to Ensure Compliance

Your company will not adopt RFID in a vacuum. You will be working with other companies to understand each other’s compliance requirements, which can be a daunting task once you have a dozen or more trading partners with varying compliance requirements. This necessitates a time-intensive process to document and maintain compliance documentation as it changes, frequent communication with trading partners, a tracking database, and regular internal communication. Once all of this is in place, companies can be more productive and competitive than ever before, but it requires a large investment of time and a large enough team to help ensure compliance.

Of course, one of the greatest features of using RFID is the increased automation it brings to your inventory management. Automation means less time worrying about the small stuff and more time worrying about the bigger picture. If you’d like more information about how to become more efficient and decrease costs, be sure to subscribe to our newsletter to have high-quality advice delivered right to you!

Metrics Every Retailer Needs to Know to Improve the Customer Experience

Customer experience and satisfaction are top priority in retail. To be at your best, workforce planning and workforce management must be structured with the customer in mind and the business must be willing to make the required adjustments to keep them top priority. We know through our experience with leading retailers that measuring metrics, comparing results and implementing changes is a recipe for retail success. Here’s some food for thought:

 Let’s tear into it, shall we?

Meet the Metrics

We help our clients understand more about their customers than they thought possible. A few of the metrics we provide and help clients understand how to drive are:

Average Time in Store
-The amount of time a customer spends inside your store. The longer a customer is engaged in your store, the higher the odds of conversion and increased units per transaction.

Conversion
-This is the proportion of the number of visitors to your store who become customers through purchasing merchandise. The higher the conversion rate, the better your store and sales associates are performing. This metric relates directly to average time in store, as odds for conversion increase if a person spends more time shopping.

True Conversion
-Calculating conversion through traffic is only part of the story. However, traffic counts have accuracy issues and not every person in the store is a buying customer. A family of five for example is only going to count for one transaction if they purchase. We help our clients understand the true conversation of potential customers.

Transaction Time
-The amount of time it takes for a transaction to complete from when the customer reaches the cash wrap. Customer experience is enhanced when transaction times are kept low. This is the last part of the customers visit. You want to make sure to end on a great note and not spoil all of the previous work you have done.

 Keep in mind that, although you want to keep transaction time low, you want to keep customer satisfaction ratings high. Your sales associates still need to be top performers while completing the transacting efficiently and effectively.

Units per Transaction (UPT)
-The number of individual items that make up one customer’s transaction. The more time a customer is in your store, the more time they have to shop for more units and increase this number. Your associates also can influence this greatly by providing outstanding service.

Average Group Size
-The number of people who come in together to shop at your store. This information can be helpful for workforce planning when scheduling shifts. If your average group size is larger, more sales associates might be needed to make sure all customer needs are being attended to and to drive top line sales.

 Shopping is a social event for many, so it’s not uncommon to deal with customers in groups instead of one-on-one. Who doesn’t love a shopping day?

Workforce Metric-ment

Question: Why do you, the retailer, need to know, not only these metrics, but your results for these metrics when constructing your workforce planning and workforce management?

Answer: Customer satisfaction! We know that customer experience and satisfaction are a primary consideration in your workforce planning. You need to implement labor standards that provide the most opportunity and ease for enhancing a customer’s shopping experience. If you provide your customers with the experience they want, sales and profits will come along for the ride!

Think of your workforce management as workforce metric-ment: workforce planning that is centralized around instituting changes to improve upon results of the metrics. It’s one thing to know how your store currently performs; it’s another to go about making the changes to improve each individual result to focus on customer experience.

Request a free consultation to gain even more valuable insight on what metrics mean to your retail success story.

Does 1 Second Really Matter?

Occasionally I have been asked to justify why anyone in retail would need engineered labor standards. The arguments go something like,

• “Does one second vs one and a half seconds really make a difference?”
• “Most scheduling systems round labor anyway”
• “At the end of the day, operators have to schedule to the budget, not to labor standards”.

The basis of these questions is probably related to a bad experience trying to implement a pile of over-engineered labor standards that were handed off with little context or considerations for the end use. I know this because it happened to me back in my workforce management software implementation days. I have seen over engineering and incomplete labor engineering — typically from consulting firms whose primary services are focused elsewhere.

Labor standards should not be thought of as over-engineered time studies that split the hairs of time and are not compatible with environments that operate more fluidly. They are precise and accurate calculations, true, but in retail practice they should be viewed as a means to a more operationally productive end.

Engineered labor standards are the basis for achieving operational excellence. They are about understanding the workload required to effectively and efficiently operate your stores to make your workforce more productive. The information and insight they provide can lead to substantial gains in labor savings and lead to increased profitability. In most cases our clients are able to reinvest savings from inefficient tasking work to customer service and selling. Labor standards can also help make workforce management scheduling systems more accurate and work toward sharpening the budget – not blowing it.

So back to the original question – “Does one second really matter?” The answer is that you are asking the wrong question. The question should be, “Do labor standards really improve my operations?” The answer to that question, that we have seen over and over again across our clients, is emphatically “YES!”.

More to come on operational excellence and top-line growth…..

Sensing the Retail Store’s Pulse

Fresh from NRF2017, PJ Jakovljevic of TEC wrote a great article summarizing the momentum Reflexis Systems currently has in the market.  PJ specifically describes how the Reflexis partnership with Connors Group is a “step in the right direction” and will enhance their ability to compete.


Reflexis Overview

Founded in 2001, Reflexis is headquartered in Dedham, Massachusetts, and has offices in Atlanta, London, Düsseldorf, and Pune (India), with additional sales presence across cities in Europe and Latin America. Some of the company’s ~320 employees are stationed in their home offices in many other places.

The Reflexis retail store execution (operations) software platform started from store operations software solutions such as task management for corporate planners and store managers and retail store auditing for regional managers (the latter called StoreWalk). In 2009, the vendor expanded into the realm of labor operations software solutions such as time and attendance (T&A), workforce management (labor budgeting, forecasting, and scheduling), employee self-service, mobile apps, and analytics (see figure 1). These retail store execution capabilities aim to enable retailers to align store labor and activities with corporate goals and to institutionalize best-practice responses to near real-time exceptions and alerts.

More than 240 of global retailers in multiple vertical retail categories have reported significant improvements in store-level compliance with corporate strategies and increased revenue and profitability after implementing Reflexis solutions. These include grocery, quick service restaurant (QSR), convenience, specialty, big box, and apparel stores. In fact, Reflexis has an impressively high customer retention rate of 97% and high customer satisfaction ratings.

Figure 1. Reflexis retail execution platform
Figure 1. Reflexis retail execution platform

IoT-enabled StorePulse

Reflexis recently moved into the real-time retail store operations realm with StorePulse. This solution has since been adopted by major discount, grocery, consumer electronics, and drug/pharmacy chains. This is an IoT play where retailers can link their existing systems and devices to Reflexis to create automated best practice actions for store associates and store managers. This is based on metrics and exceptions from store supply chains, point-of-sale (POS) devices, store traffic counters, loss prevention, and various other retail systems (see figure 2).

For example, a major big box retailer is using the Reflexis StorePulse solution to greatly improve the efficiency of execution of the retailer’s in-store price matching promise to consumers (who typically come to showroom and then buy from the likes of Amazon). In this setup, store managers can approve the price reduction request by responding to a StorePulse alert with a simple “yes or no” click or finger push. Previously, store managers would have had to spend an inordinate amount of time shuffling papers or through computer screens to find info on the product whose price discount needed approval, which prevented them from doing more valuable stuff (imagine doing about 30 such approvals a day).

Check out the remainder of the article here.

 

Store Closing Trends and Operational Opportunities

The convergence of several retail patterns continues to point toward an increased need for operational labor improvements, from retail stores to distribution centers.

Retail store closings have been making headlines over the last few weeks.  Macy’s, Kohl’s, Walmart, and Sears have all announced store closings.   Conversely, the trend for distribution centers appears to be growth; in terms of new facilities, facility size increases, and inventory turns.  This largely reflects the impact of ecommerce growth.

We also continue to read, and hear from our clients, about Millennial’s desire for experiences in stores and increased service levels.  So, while the sales volume may be shifting to online transactions, there is still a demand for enhanced in-store service.

The need to increase the focus on customer service by minimizing time spent on non-service store activities/tasks (stocking, merchandizing, receiving, etc.), becomes tremendously important.  Our consultants, however, continue to see high levels of non-service tasking, and inconsistent execution coming at the expense of service across most retailers.

Time spent with customers is crucial to driving conversion and higher units per transaction, and needs to be focused on heavily to maintain the correct payroll percent.   This is negatively impacted if store employees are increasingly burdened with inefficient processes, or not well trained on defined best methods.

A reduction in physical store count means that the remaining stores will need to up their game operationally to meet the customer demands.  The remaining stores will not receive much payroll breathing room from the closing store cost reductions, and will need to prove their worth and viability on a daily basis by extracting the highest value from the labor they have remaining across the fleet.

We have found that processes in both the distribution centers and the stores can be improved to help ensure that product is delivered efficiently, and in a way that is quickly and easily merchandised at the store level.  Minimizing this type of tasking time to reduce overall payroll spend, and to refocus efforts on customer service, is essential.

The trends point to decreased physical store footprints, increased customer service levels, and increased distribution center activity.  Operational processes need to be crisp, and labor needs to be balanced optimally to pull this off effectively.

How to balance team development with operational duties: three steps to success

In today’s post-recession environment, companies are finding it increasingly difficult to keep up with lingering growth expectations. As a result, most management teams focus more time on operations than finding and training employees. In fact, we’ve found that managers spend less than 15 percent of their time on team development, disrupting the balance between operations, sales and talent acquisition.
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Welcome to our blog

Let’s face it, managing a business is no walk in the park. Between fluctuating markets, buyer uncertainty and an increasing focus on efficiency and return on investment, it’s easy to throw up your hands in frustration wondering where you should start. Here at the Connors Group, we’re all about helping our clients achieve real, measureable and sustainable operational successes through proven, results-driven programs created and delivered by our expert team of consultants. We help companies improve the way they do business—whether focused on customer experience, distribution planning or engineered labor standards.
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