Tuesday, December 20, 2016

Why are your Salespeople leaving you?

One of the rhetorical questions asked in retail circles is “Why should we train our salespeople; they are going to leave us sooner or later anyway?”  And the answer to that question is another poignant question… “What if you don’t train and they stay?”  In fact, I’d further like to ask them a counter-question “Would you allow a guest in your home to be ill-treated?”  If the answer to my question is a ‘No’ then, retailers should recognize that customers are indeed guests in their stores and are currently being offered sub-standard service due to poor training or lack of it.  While it is shocking to me that retailers ask that question in justification of not investing in training; it is a question whose answer is so obvious that it doesn’t warrant the question in the first place.  ‘Attrition in retail is a given – universally.  It cannot be wished away’.  The only reality about it is that, it is manageable in some formats; but is not so in others.  (I won’t say ‘low’ or ‘high’ as that is relative).  Retailers will do good to understand the factors responsible for attrition and address them with a strong will and diligent execution if they want to minimize attrition. (I’m not sure it can be totally eliminated!)

Attrition in retail is most frequently attributed to a purely economic reason – that salespeople jump jobs for a raise of a few hundred rupees.  However, having seen different retail formats at close quarters, my personal point of view is that…

 Money is only one of the many reasons for attrition.  Cost of running retail operations is proportionate to the scale and complexity of the format – supermarkets make thinner margins than do department stores; but the costs of running a department store is higher than running a supermarket.  Therefore, profitability in retail comes from an efficient management of costs – not from deprivation!  Many retailers can only pay minimum wages to their salespeople and obviously cannot compete with high-margin retailers or other industries that pay more – BPOs etc. Balancing manpower cost as a percentage of total cost will continue to remain a huge challenge until the industry matures – where there will be quality manpower available in abundance and systems and processes will be well established bringing in cost efficiencies.  Retailers can choose to keep their staff happy by paying them competent salaries and still be profitable; than by cutting corners and spending hugely on replacement costs (not to mention business lost due to poor service).  Retailers can design attractive incentive schemes (that are variable according to the sales generated by each sales person) and make working for them more desirable.  ‘Starbucks’; the Seattle based coffee-chain today boasts of over 17,000 stores in 50 countries manned by ‘partners’ (that’s how all employees are referred to as).  Starbucks is known to spend more on employee benefits than they spend on sourcing their main ingredient – coffee!  All eligible full and part-time Starbucks ‘partners’ (totaling about 80,000) are offered comprehensive health coverage and stock options in the company.  Little wonder that Starbucks ranks on the top of the World’s most ethical companies in its category.

There are four other psycho-sociological reasons that can have devastating impact on any retailer’s most valuable resource – people.  First, there is a serious lack of entry-gate assessments for people entering the industry.  Second, retail stores find it mind-boggling to define job responsibilities at all levels of operations.  Third, people working in retail suffer from dissatisfaction arising from not being able to perform their tasks satisfactorily and finally, the retail industry in India is yet to adopt international performance measurement systems at the store and individual level – that help in setting up fair reward and recognition practices.  A closer analysis of each of these factors can help us understand the complexity of the issue and perhaps find practical solutions to address them.   

No entry-level quality checks:

Not everyone is made for a career in retail – just as not everyone is made for a career as a nurse.  The single-most important trait to look for in retail staff at the time of recruitment is their attitude – an attitude to do whatever it takes to satisfy customers with a smiling face.  All other skills – product knowledge; store operations and selling skills – are trainable.  Unfortunately, retailers are not in a position to conduct any quality checks to ascertain whether the candidates they are recruiting have the required attitude.  In fact, retailers are constantly in need of people – ‘yesterday’- that they overlook this essential characteristic in applicants.  Aspirants who join retail jobs awestruck with the glamour of the role – being able to meet new people and socialize; work in glitzy stores in air-conditioned comfort and store music – are completely disillusioned when they realize that their jobs are not all that glamorous after all.  Retail sales people are also required to perform other backend tasks – inward; count; tag; stack and move merchandise; fill out multiple forms; remain standing on their feet for eight to ten hours a day and serve customers with a smile.  The disillusionment arising out of the gap in their expectations and the reality; is also a major cause for attrition in retail.  Those that realize that a retail job is not their cup of tea; quit never to come back.   The pity is that recruiting and onboarding of personnel has costs and retailers are having to incur them repetitively until they fix the problem of hiring the ‘wrong’ people.  So, it’s a perennial ‘chicken and egg’ situation for retailers – whether to slow-down and hire right, therefore minimizing the chances of attrition OR speed-up store openings and get anyone with a heartbeat on to the sales floor and keep replacing them every 60 days!

Ambiguity about roles:

People who are able to heroically measure up to the almost military regimen of retail, go through hair-pin bends all through their careers.  Lack of job clarity makes it impossible for retail staff to defend themselves from any and all types of work dumped on them.  It is not uncommon to find staff arrive for work at 8am; unload trucks of merchandise; take physical inventory of stocks against invoices; tag and label merchandise; transport them to the shop floor and stack the store-shelves.  And then, they are expected to remain on their two feet for eight to 10 hours helping customers; straightening shelves; rearranging merchandise and then repeating the same rigmarole almost every single day – often many times over during the day!  I’m yet to come across any Indian retailer that has clear job responsibilities communicated to retail staff; although I must add that it is not intentional.  When retailers are able to communicate what needs to be done – why and how; there will be no incomplete or forgotten tasks and more importantly, fewer frustrated salespeople.

Impediments to performing tasks satisfactorily:

In the absence of any documented job description – staff do not know how to prioritize their time between all of the above mentioned routine tasks.  Consequently, remaining on the sales floor and selling to customers, becomes just any other task on their ‘list of chores’ and gets treated that way – both in terms of attitude and effort.  (little wonder then that we see such poor service in retail stores!).  All this, leaves a sense of ‘lack of purpose’ and erosion of self-worth in salespeople.  As if this were not enough, store managers – who are generally ‘managing chaos’ instead of ‘inspiring success’ – keep directing retail staff in all directions ordering them to accomplish different tasks.  More often, when sales people disappear from their jobs, they are actually quitting their tyrant managers and not so much their jobs!

Absence of objective performance measurements:

Lastly, few retailers use any objective performance management systems – that help set objective, fair sales goals and define the right behaviors for salespeople.  Therefore, store managers and retailers end up using subjective opinions – rather than have objective measurements – to assess and evaluate staff performance.  The inequal and inconsistent grant of rewards, and the issue of consequences; leads to feelings of favoritism that further leads to break-down of team spirit.

Consequently, frustrations from all these levels add to a compounded feeling among retail staff of being over-worked and underpaid; with no clarity of purpose or sense of self-worth.  Unable to share their anguish and frustrations, the only solution they see is the sneaky path leading to an escape – both, from the suffocating environment and the unreasonable people they are working with.  Alas, when they quit and (luckily) land another job at a different retailer; only the faces change.  All else; including the problems, continue to remain the same or sometimes worse than at their previous employers!

Thus continues the cycle of ‘quit and return’ – almost akin to the cycle of ‘birth and death’.  What retailers should ask themselves is the question – why salespeople quit, or rather who are salespeople quitting from? The sooner they ask this rather poignant question, and find answers; the sooner they will be able to set their houses in order.

It is those few blessed retailers that want to redeem themselves from the throes of chaos; heights of inefficiencies and depths of frustration that seek pragmatic solutions to bring some method to the madness!

Tuesday, September 20, 2016

Retail needs more TAPANs

I am glad that my grinder at home broke down recently.  Had it not, I wouldn't have come under the gracious service of Tapan.

I dutifully took the noisy grinder to an outlet of a major electronics retail chain that I had bought it from.  It was out of its warranty period, and I was obviously willing to pay for fixing it.  I had left it with the retailer for over a week - along with the warranty card for whatever it was worth!  I had to make several calls during that period to check the status of my mixer. My patience was running out as they kept promising that it was being sent from one service center to an other.  Surprisingly, the brand of grinder didn't demonstrate any eagerness to fix it, much less the retail chain that sold it to me.

Electronic retailers in India are notorious for hiding behind a licentious fact that servicing of an electronic appliance or gadget (sold by them) is none of their business! and that it is only of the brand's service center. What the salesperson will do with a lot of finesse though, is that he/she will quickly tear a corner of a newspaper and will hand it over to you, with the telephone number of the service centre - not necessarily toll-free - illegibly scribbled on it!  This they consider to be a benevolent act of generous service to the already suffering and legitimately frustrated customer. What they don't seem to realize is that they are indeed telling the customer that "you have bought the product at your own risk (peril)".  If you notice closely, the salesperson is at least twice as eager and intense in handing over that piece of paper than he was when he actually sold you the product!!

Now, this is the point where any trace of 'customer service' the retailer is capable of, goes clearly into the trash can!!

On the 10th day of my depositing the broken mixie, I kept getting repeated calls from a landline number that only my truecaller identified as that of the retailer.  I was only greeted by annoying busy tones the several times I tried returning the calls I had missed during the busy day.  I finally landed up at the retailer's outlet after work; partly frustrated and completely angry!

My first encounter at the service desk was made with this very unassuming, un-uniformed guy with a genuine smile.  All my frustration of having waited for over a week and having made several calls to check the status, vanished on seeing him.  When I inquired about my mixie, he told me how he had unsuccessfully tried to reach me several times during the day.  I apologized for not being able to take his calls and inquired about it.  He deftly pulled out the bag that contained the fixed appliance.  He volunteered to explain what had gone wrong and how it was fixed.  I requested him to demonstrate by running it, so that I could convince myself of its recovery.  While doing so, he continued to speak to me about how good it was now and that the mild noise emanating from the whirring motor was only temporary and would disappear after a couple of days of use.

Finally, when it was time for me to pay for it; I inquired how much I was due and was pleasantly surprised when I was told the damage was all of Rs.140!! I handed over two currency notes of Rs.100 each. It was while waiting for the balance change that the truth was let out by his colleague...That, when the service centres had returned the mixie under the excuse of "No spare parts"; Tapan had voluntarily taken it to a small-time mixie technician near his home and had it fixed; paying for it from his own pocket.

This revelation left me speechless and astonished for a few moments.  I did not see any reason for Tapan to have taken this upon himself to fix my broken appliance.  But he had...and how?  At that moment, I was convinced that I couldn't possibly pay for his genuine attitude of service..and that no amount would qualify as appropriate.

Still in amazement, I called him aside for a quick chat..and he reluctantly stepped out of his station, behind the service desk.  When asked what motivated him to take this proactive step; he shyly replied...that he had just put himself in my shoes and imagined how I would feel very disappointed to learn that my mixie was not repaired even after a long wait...and that he just went ahead and got it fixed, risking paying for it from his own pocket...whether or not I agreed to pay for it.....now, how can I define this service, if not but DIVINE?

I then discovered that Tapan, who hails from Odisha, was a diploma holder in automobile engineering.  Considering that he was barely a fortnight in employment with the retailer, and knowing how retailers in India operate; I was almost certain that he had not been subjected to any training whatsoever.  He also definitely wouldn't have seen his first salary yet!

What motivated Tapan to act in the spirit of unalloyed service, spending his own money to have the customer's problem solved, when he had no apparent incentive for doing so...and risking the fact that his spend may not be reimbursed...is supremely energizing and divinely uplifting.

I'm still wondering whether "Customer Service" is really a trainable trait!