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Transforming Retail Workforce to Achieve High Performance
1. Transforming the Retail Workforce
to Achieve High Performance
by Teri Babcock and David L. Reed
2. Teri Babcock is a partner in Accenture’s
Retail practice. She has worked with
clients in the human performance,
talent management and learning
space for more than 17 years.
Teri can be reached at
teresa.j.babcock@accenture.com.
David L. Reed is a senior director in
Accenture HR Services. He has led
Accenture's external and internal
recruitment business for 17 years.
He posseses extensive experience
across all strategic and operational
aspects of recruitment across multiple
clients, industries and geographies.
David can be reached at
david.l.reed@accenture.com.
cov2
3. Hiring the Right People:
Human Capital Sourcing and Staffing
Retailing is the preeminent day-to-day • The number of young European however, that for visionary companies,
business enterprise. The focus on the workers, those aged 20 to 29, will the unique workforce dynamics at
latest numbers is intense: How many decrease by 20 percent over the work in the retail marketplace create
associates are available next shift? coming two decades, while the a significant opportunity to achieve
What was store traffic last weekend? number of workers approaching high performance.
How will we train associates on the retirement (aged 50 to 64) will
Accenture High Performance Business
new products that arrive tomorrow? grow by more than 25 percent.
research shows that small improve-
What are our sales this month? Store-
• Japan expects to lose 10 million ments in key talent management
level execution moment-by-moment
workers, or 16 percent of its work- performance indicators such as
makes or breaks the enterprise.
force, over the coming quarter- attrition, speed to competence and
What, then, should retail executives century. One in five Japanese is over associate performance can drive
make of these decidedly long-term the age of 65, the highest ratio disproportionately large improvements
data points? of seniors to citizens in the world. in customer satisfaction and financial
performance. This paper explores
• The workforce in the United States These statistics suggest that one of
opportunities for transforming retailing
will expand by only three percent retailing’s most venerable fixtures, the
associates into a high-performance
from 2000 through 2020, as com- retail workforce—the people behind
retail workforce by focusing on
pared with a 53 percent increase the counter, at the checkout station, in
three key talent management levers:
over the 20 years from 1980 to 2000. the stockroom—is already undergoing
recruiting, learning and performance
dramatic change. This change may
management.
threaten or undermine many retail
enterprises. Accenture believes,
1
4. selection techniques and technologies Accenture takes the view that retailers
Selection processes
offer significant opportunities. Instead should:
of high-performance of relying on the hit-or-miss tactics of
• Re-tool their recruitment and
traditional recruiting, these new tech-
companies selection profiles based on analyses
niques and technologies can be used to
of the performance of the most
Successful retailers have human capital match new job profiles—and the per-
successful workers in the current
strategies designed to ensure that the formance characteristics of the workers
work environment.
right people and the right capabilities who are the highest achievers—against
are in place to execute the business potential worker pools. • Apply that profile and those perfor-
strategy effectively. What all effective mance characteristics across the
Some retailers are creating simple yet
enterprises have in common is a company’s basic core processes.
ingenious responses to the challenge of
mature process for formulating and
smarter selection. Consider the practice • Use next-generation technologies
aligning human capital initiatives with
of one European retailer that requires and tools in the selection process to
business strategy. These organizations
that a prospective employee must work reduce both false positives and false
make clear priorities and track their
in the store he or she will be assigned negatives among potential workers.
people and workforce programs based
to for one trial day before being hired.
on the business value they create. • Push the biggest part of the filtering
Expectations are explicit, and after
to the front end of the process—
Imagine a manufacturing process the trial is complete, the staff of the
before more costly human analysis
where companies had to manufacture store votes on whether the prospect
is applied to selection—and let
150,000 parts in order to end up with gets the job. The approach has yielded
insight-based applications help pre-
1,700 parts of acceptable quality. Yet impressive results for a chain that
dict those applicants most likely to
this is exactly the yield from most relies on quick, efficient service to a
respond to and perform well under
recruitment processes. Even in the face high-end clientele for its success.
updated performance conditions.
of this extremely inefficient process,
Basic hiring practices for retailers have
HR departments often feel manage-
not kept pace with the actual perfor-
ment pressure to increase the pool of
mance environments in which workers
potential workers. We believe that
find themselves. As a consequence, HR
smart hiring is not a recruiting prob-
departments searching for the best
lem; it is a selection problem.
people are getting “false positives”:
Companies do not need to increase
workers that appear on paper to have
the pool; they need a better yield.
the skills to succeed, except that the
One of the biggest hiring challenges “paper” contains out-of-date perfor-
retailers face today is the disconnect mance criteria. Just as worrisome,
between new job profiles and a HR professionals are also getting false
recruiting process that too often hires negatives: they are failing to hire
based on old profiles and inconsistent workers with the right backgrounds
selection techniques. For HR depart- and skills to perform optimally, because
ments in retailing enterprises, new the HR department is not aware of
the change in the definition of optimal
work performance.
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5. A simple start toward high performance
Many retailers are challenged to identify the specific problem level employees along a more cost-effective path to high
areas for their key workforces, or to prioritize initiatives to performance.
address workforce issues. Based on our extensive experience
4. Develop a set of integrated talent management
with companies around the world, Accenture believes that
solutions to address the workforce gaps.
when organizational energy is focused on two to three criti-
cal workforces, even slight improvements can make a 10 to Fundamentally changing—and sustaining—higher workforce
15 percent difference in the company’s bottom line. performance is a complex undertaking. Look first at how
selected HR programs can be integrated for a specific work-
For example, the retail division of a major US bank calcu-
force, rather than rolling out individual programs across
lated that every time it cuts a single second from call
the organization. Results will likely show significantly higher
handling time, it adds up to US$1 million in savings for the
performance for that selected workforce than when programs
bank. A global insurance company with 16,000 life planners
are implemented independently.
in Korea found that a one percent change in a single measure
—growth in written premium per life planner—translated 5. Define an overall human capital roadmap that will lead
into a US$16 million improvement for the company, most to fundamental, lasting change in your workforce.
of which was pure profit. These incremental improvements
Include both “quick hit” initiatives, like targeted learning
are the quick hits that will put the enterprise on a path
programs, and long-term investments, like technology
toward high performance.
or store infrastructure. Evidence suggests that quick-hit
While each retail organization will have its own challenges savings used to fund long-term investments create
and opportunities, consider these six steps for getting sustainable change programs that are more palatable to
started: company executives.
1. Identify the two or three most critical workforces 6. Implement and measure return on investment, making
for your organization. calculated adjustments along the way.
While retailers have a number of critical workforces, the Implementation raises several practical questions. What is
customer-facing frontline associates may provide the great- the appropriate frame of reference—the entire enterprise
est opportunity. In high turnover environments, explore or all retail locations? In Accenture’s view, retailers should
recruitment and learning strategies to improve speed to start with the box, the four walls of the retail location.
competence. A floor salesperson who gets up to speed five Start building a better workforce inside the box, which is
percent faster yields significantly superior performance in ultimately the profit-and-loss entity that counts. Measuring
terms of product knowledge and customer satisfaction. progress and adjusting along the way is critical. Human
metrics are often perceived as soft and in a tight margin
Another critical workforce in retailing is buyers. No matter
business, CEOs do not invest where they cannot prove
how good a workforce is, if the wrong products are on the
a return.
floor, the store will fail.
Each organization will have its own unique journey. Yet
2. Define what optimal performance looks like for
“leaders” in the human capital management arena display
those positions.
certain characteristics in common, as shown by the
Evaluate your top performers for each key position. What Accenture High-Performance Workforce Study, a compre-
skills and experience do they bring that differentiates hensive research program conducted approximately every
them from poor performers? From which recruiting pool 18 months with executives globally. For instance, the leaders
did they come? What previous positions did they hold in that emerged from this research tend to value human
your company? resources and training more highly than do other companies.
The example of these human performance leaders suggests
3. Assess where capability gaps exist between current
that the integration of initiatives in recruitment, learning
and optimal performance.
and performance management—with a particular focus
Understand the gap between your top performers and others on support provided to critical workforces—is the key to
to (1) identify better candidates and recruiting channels transforming employee performance.
and (2) tailor learning and development programs for entry-
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6. Learning and Knowledge Management:
Skills and Behaviors
that Drive High Performance
Once the right talent has been identi- The transformation of the learning • Aligning learning activities with
fied and recruited, how do you equip function from a cost center to a the most pressing and important
them with the critical knowledge value creator can be seen in recent business or operational needs.
needed to be high performers? Accenture Learning research, “The Rise
• Measuring the effectiveness and
Consider the second key talent man- of the High-Performance Learning
impact of learning on the perfor-
agement lever—learning. Organization.” The study, which sam-
mance of the business or agency as
pled opinions from chief learning offi-
Learning has moved from the periphery a whole.
cers and other learning executives at
of public and private enterprises to the
285 cross-industry organizations, • Proactively communicating the value
center over the past decade. Individ-
reveals in vivid detail the new demands of learning to all stakeholders.
uals know that their careers depend
being placed on learning functions
upon their willingness to engage in The Accenture Learning study contains
today. The learning functions at most
lifelong learning that can help them provocative evidence about the impact
of the organizations participating in
advance to meet new challenges. learning can have on the business.
the Accenture Learning survey clearly
Retailers realize that unless their About 10 percent of the learning
face heightened expectations to deliver
people are fully competent to execute organizations surveyed had levels of
business value and prove the business
strategy today and tomorrow, they performance that earned them the
impact of learning investments. When
cannot achieve high performance and title, “High-Performance Learning
asked to name their most pressing
sustain their competitiveness. Organizations.” The reason? Every
challenges, learning executives made it
enterprise utilized innovative
clear that business impact was their
approaches to learning, approaches
primary concern:
that tracked the impact learning has
on the business.
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7. Analysis of survey data, coupled with • Ensure participation of the learning
Accenture Talent Interlock:
additional financial data from other organization in the overall gover-
Executive leadership
publicly available sources, has demon- nance process.
strated that companies with high- and governance that keep Accenture Talent Interlock does not
performance learning organizations
simply add another step in the learning
learning on track
returned better revenue and profit
supply chain of content sourcing,
growth compared to their competitors
Armed with evidence of the link cataloging, delivery and administration.
and industry peers:
between world-class learning strate- It transforms it in the same way that
gies and business results, leading
• Productivity (as measured by sales new processes transformed the manu-
retailers are looking for ways to ensure
per employee) was 27 percent facturing supply chain to enable just-
close collaboration between those
greater. in-time (JIT) manufacturing. In fact,
responsible for the development and that is one of the goals of Talent
• Revenue growth was 40 percent
delivery of learning content and the Interlock: a JIT approach to talent
higher.
company’s senior management respon- management, where a streamlined
sible for establishing business goals
• Net income growth was 50 percent learning supply chain delivers support,
and objectives. This collaboration is
greater. when and where it is needed, to sup-
too important to be left to chance, or port real-time performance needs of a
These high-performance learning orga-
to simply “keeping management company’s most critical workforces.
nizations show mastery in a number of
informed.” Retailers need a more
important capabilities, including:
formal organizational structure and
system of governance to ensure that
1. Investing in learning according to its
strategy and workforce enablement are
impact on the business: aligning learn-
“locked in.” Accenture has developed
ing initiatives to business goals, mea-
this reporting and governance process
suring its impact in business terms and
in Talent Interlock, a proprietary
running the learning function itself in
process with services, interactions,
a rigorous way.
metrics and application capabilities
2. A healthy percentage of technology-
that link learning outcomes to business
delivered learning, with an emphasis
objectives.
on “blended” delivery approaches that
Accenture Talent Interlock operates on
include classroom as well as electronic
a few critical guiding principles:
learning, and learning solutions that
build upon knowledge management
• Ensure the involvement of senior
and performance support functionality.
executives in the planning process
regarding the specific learning
3. Movement of learning outside the
programs that can achieve the best
“four walls” of the organization to
business results.
include other members of the overall
value chain such as customers and
• Facilitate an annual planning process
channel partners.
and quarterly demand forecasts
around learning demand, capability
4. Involvement of learning and perfor-
and affordability.
mance-enablement efforts during
major change programs and in support
• Establish a single point of contact
of business initiatives.
for all learning and performance
requests from the business.
• Structure more effective communi-
cation channels between the
business and the corporate learning
organization.
5
8. Performance Management:
Alignment with Strategy
Thus far we have talked about (1) how Effective performance management Consider the four options implied in
to get the right people through the begins with understanding that perfor- the accompanying figure, a matrix
human capital “supply chain” more mance has two dimensions: behaviors plotting results vs. behaviors. Workers
rapidly to increase the supply of and results (see chart). Too often, who fall within the “high behaviors/
employees optimally equipped to serve companies take a view that what really high results” quadrant obviously
the needs of the business; and (2) matters is just results—the productivi- challenge a company principally from
providing people with the skills and ty of a worker. In fact, that approach the perspective of retention: these are
knowledge needed to perform optimal- can blind executive decision-makers staff that retailers want to retain for
ly at all times. Performance manage- to the specific behaviors that drive as long as possible. In a different way,
ment addresses the issue of keeping those results. “low behaviors/low results” are also
those people aligned with the needs fairly straightforward: these people
of the business, and keeping them should be offered remediation but, if
engaged and interested in their work performance does not improve, should
High
so the investment in them pays off for be moved out of their jobs and/or the
the entire organization. company.
Behaviors
Low
Low High
Results
6
9. It is those two other quadrants that hard, and in either case are misaligned Performance management
pose the challenges. One group appears with the goals of the organization. In
and employee engagement
to be doing all the right things but is light of this, they require a different
not being productive. The other group level of management. Given the right
Effective performance management is
is delivering results month after set of supportive environments and
a huge contributing factor to increasing
month, but only through behaviors appropriate mentoring, many of these
the engagement of employees in their
that one might not want replicated workers can achieve goals and perfor-
work and, therefore, improving reten-
throughout the company. For example, mance beyond their own expectations.
tion—especially of “high behaviors/
consider the president of one major
high results” employees. Solving the
High-performance retailers also know
company who kept hitting his perfor-
employee engagement puzzle is partly
how to handle turnover properly; they
mance targets time after time. Only
a matter of putting people into roles
know how to address that portion of
after close scrutiny did the executive
for which they are not only competent
workers who most often fall into the
team find that the consistency of this
(or potentially so), but for which they
“low behaviors/low results” quadrant.
executive was being achieved only
feel some passion. It is possible to
Employee turnover can be a good
at great cost to the rest of the organi-
overstate the “passion” point, but more
thing, if it is properly planned and
zation: morale was nonexistent and
often than not, the problem is ignoring
managed. Organizations that have
retention was extremely low.
it. An executive at one company said it
consistently high business or financial
well: If, in the course of fulfilling an
By giving attention to which specific performance also have some sort of
individual’s passion, they also fulfill the
(acceptable) behaviors lead to the best planned or managed turnover program.
organization’s passion, superior perfor-
results, companies can design roles, They have taken conscious steps to
mance overall will result.
find the right individuals to fill those routinely upgrade their workforces.
roles, train them to successfully per-
From one perspective, the employee
There are two parts to this upgrade.
form in them and manage individual
engagement problem is reaching crisis
One is using turnover as a reason to
performance against the desired
levels. Another survey by Gallup of
shuffle people and roles, often to
behaviors. If companies do not have
more than three million employees
match underperforming employees
the measures in place to assess
found that 71 percent describe them-
with roles that might be more appro-
progress toward the desired behaviors,
selves as disengaged or actively
priate to them. Many managers have
people probably will not produce those
disengaged from their work—the
had the experience of watching people
behaviors consistently.
fourth straight year that workforce
blossom from average to superior
engagement has declined. For the retail
Think this is obvious? Not in practice. workers simply because they were
industry, where customer loyalty and
Companies can often send mixed mes- finally matched to the right jobs or
retention is so dependent on effective
sages about results vs. behaviors. For roles. How many times do companies
interaction with competent workers,
example, they tell sales staff to take let go of someone with potential, not
this is a big danger sign. On the upside,
the time to understand what the cus- because of the individual’s short-
however, a fully engaged workforce
tomer really needs. But, for the most comings, but from the organization’s
can pay big dividends. In fact, research
part, the single-most critical measure or leadership’s lack of insight about
has shown that the more engaged
of performance for these employees what that person is really good at?
the workforce, the more innovative,
will still be total sales.
The other part of turnover manage-
productive and profitable the company.
The solution here is for retailers to be ment, though, is systematically plan-
clearer—to themselves and to their ning to move out of the organization
employees—about roles and metrics. the bottom 10 percent or so of its
Set clear performance goals and mea- workforce, based on well-defined
sure toward them. Do not be afraid to performance criteria documented in
set “stretch” goals. Retailers that really performance reviews. This is not a
optimize the performance of individu- heartless program. If reasonable efforts
als have a systematic way of setting have been made to find the right role
expectations that create a challenge. for a person in the organization, and if
Much of the time these are goals that performance is still not strong, it is
the individuals themselves do not real- likely that the fit just is not right.
ize they can meet. Average to low- Every employee termination comes
average workers tend to set goals that with emotional pain, but this short-
are either too easy or too term pain can be understood as having
long-term benefits for all.
7
10. The Accenture Integrated Approach to Managing
the Retail Workforce for High Performance
Recruitment Services Learning Services
Sourcing Knowledge Management Content Development Content Sourcing
Screening & Selecting Content Delivery Learning Administration Integration & Orientation
Performance Management
Hiring
Services
Talent Interlock
Onboarding Competency Modeling Workforce Analytics Performance Management
Scheduling &
Job Design Certification/Accreditation Career Development
Deployment
Contractor & Contingency Learning & Career Needs Resource Demand
Succession Planning
Management Assessment Management
Support Services
Program Management Infrastructure Platform Management Service Center
An integrated, technology-enabled solution can deliver Recruitment Services Performance Management
breakthrough increases in workforce performance. The Technology-enhanced services Services
Accenture approach wraps recruitment, learning and to enable more efficient Technology-enabled
knowledge management, performance management and sourcing, screening, selection performance management
support services around a core workforce dynamic called and onboarding of retail staff. capabilities that include
“Talent Interlock” to achieve high performance. measurement of individual
Learning Services performance and implemen-
Transformed delivery of tation of the performance
learning to new and experi- management cycle.
enced staff through imple-
mentation of a learning Support Services
technology platform, Process and technology
eLearning migration, instruc- infrastructure.
tor-led training content
enhancement and co-sourced
delivery.
Talent Interlock
Implementation of tools and
processes to support and
integrate recruitment, learn-
ing and performance support
services.
8
11. Building the High-Performance
Retail Workforce
Fundamental forces are driving the ment of the future, many may survive, between investments in people and
restructuring of retailing to a greater but it is virtually certain that only business results. Moreover, their CEOs
or lesser extent in virtually every major high-performance companies will suc- take a much more visible and direct
market. The dominance of discounting, ceed. Accenture’s concept of Talent role in the initiatives to develop their
the rise of online shopping, as well as Interlock is a proven process for identi- people. In this way, high performers
the demographic trends discussed at fying, training and managing critical create a “talent multiplier”—better
the beginning of this paper, guarantee retail workforces so that retailers can results per dollar of investment in their
that retailing in the 21st century will consistently deliver on a differentiated workforces. This multiplier serves as a
scarcely resemble the industry pio- value proposition, aggressively expand real and hard-to-imitate competitive
neered in the 20th. market footprint into favorable seg- advantage.
ments, drive organic growth from their
Amidst all these changes, one thing If retailers are to meet their most
existing networks, increase average
will inevitably remain constant: the important competitive challenges
product sales per person per day and
power of a positive interaction today—fight off competition coming
minimize customer churn.
between your customer and the person from few players and successfully exe-
behind the counter. Retailing in the Accenture’s High-Performance Business cute a growth strategy—they must
future will be a game of survival of the initiative has shown that high per- increase the energy and focus with
smartest. The retail enterprises that formers are more effective than their which they address the workforce
figure out how to collect the organiza- competitors at exploiting the collective capabilities necessary to succeed.
tion’s accumulated wisdom on what intelligence and motivation of their Retailing success today requires a
sells and how to sell, and then transfer workforces. There is a strong correla- highly engaged, skilled and productive
that wisdom quickly and efficiently to tion between financial performance workforce: the right people, with the
new generations of workers, are the and the priority organizations place on right skills, doing the right things to
organizations that will thrive. In the human capital development. Leading contribute to the long-term success of
increasingly demanding retail environ- companies are far more likely than the business.
others to regularly measure the link
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