REducing Retail Employee Turnover
Turnover (when employees leave their jobs) among retail jobs is typically high. However, a global fashion clothing retailer was having to fill each position in North America stores about 1.2 times per year. The costs of attracting new store personnel, training them and then ramping them up to full power are massive for a 100,000+ employee workforce.
The question was WHY?
Why would over 100% of the retail workforce leave each year? Seasonality was a component. Fluxuations of sales at each store was, too. Some were leaving for career-advancing jobs and some were students returning to school every Fall.
An analysis and survey of the store managers revealed that most employees were not leaving for better pay, back to school or career advancement. Most were leaving because they didn't feel like the company cared about them. (Reciprocity)
A solution needed to be designed using EAST (Easy, Attractive, Social and Timely) in order to change the behaviors of the young retail reps and reduce the cost of replacing each employee.
A simple reward and recognition platform was put in place to allow store managers and store employees to recognize each other when they 'caught each other doing something great.' The platform could be accessed via a mobile app or through a standard web interface.
Store managers were given discretionary point budgets and store employees could recognize each other without points.
Store managers could also recognize employees with 'free jeans' coupons and sweepstakes were used on a weekly basis to give away additional points for top performers at each store.
Store managers received training on best practices for utilizing the platform and store employees received recognition for completing short video training exercises.
A three-month pilot was implemented to segregate the Southern Region (the test group with the platform) from the rest of the North American stores. Their performance was similar to other regions prior to the pilot.
The key measures included recognitions sent, received, awards distributed, in-store sales, and of course, turnover rates at each store.
Over the course of the 3-month pilot, the stores in the Southern Region reduced their turnover by 63%. By the conclusion of the pilot, Southern Region stores were spending less on hiring and training new reps while increasing their in-store revenues. By the end of the year, the ROI was 124:1.