(Retail) Employees have needs that must be met. Although the labor pool is the number one operational expense, employees are the scarcest resource and cannot be managed as though they are machines.
Atlanta, GA (PRWEB) March 30, 2012
In his latest post on retail thought leadership site What's Next Retail, Dayforce Chief Strategy Officer and workforce management expert John Orr says overly engineered standards in legacy workforce management software offerings for retailers have not improved retailer performance. While gaining insight into the right amounts of workload and store coverage retailers need, from the insight that comes from the aggregate, average figures that engineered work standards yield, such as targets for Sales per Associate Hour (SPH) or Traffic per Associate Hour (TPH), can be valuable, Orr contends that the marginal benefit diminishes and decreases with increased levels of granularity.
Orr said, “As engineered standards move from aggregates that apply to entire retail departments or operations to discreet estimates for the length required to complete myriad individual daily tasks, information is lost due to unavoidable variability and rounding. As a result, fewer factors can be considered, and information is less meaningful. Ironically, such increased granularity is synonymous with engineered work standards exercises, and is less valuable because it does not provide enough useful business information and approach to optimally deploy a human workforce.”
In his post, Orr contends that this increased granularity, perpetuated by outdated software and out-of-touch service provision, does not benefit retailers and significantly hinders their effectiveness in measuring what’s important to optimizing their workforce productivity and performance.
“Employees have needs that must be met. Although the labor pool is the number one operational expense, employees are the scarcest resource and cannot be managed as though they are machines. The notion of basing scheduling solely according to the variables of shifts, workforce, and labor output is outdated. It does not take into account the deployment policies and skills that are required for the quality, consistent service that is necessary to convert traffic into sales and drive customer loyalty.”
Orr said that a paradigm shift is needed in the retail industry, both on the part of businesses and on the part of solution providers, to enhance customer and employee experiences and boost net profit margins and company valuations.
John Orr is the Chief Strategy Office at Dayforce and a contributor to WhatsNextRetail.com, a thought leadership site for retailer executives led by members of the Retail Industry Partner Community, a network of Microsoft Dynamics partners. You can read more from John Orr at What’s Next Retail.