Photo: RetailWire
Research ties regular shift schedules to higher retail sales
There may be another reason for retailers and restaurants to reconsider on-call scheduling of employees — the practice may be costing them sales
New research of employees at 28 Gap stores in the Chicago and San Francisco areas found that locations where associates had more consistent hours saw sales increase seven percent compared to those in the control group. Labor productivity in the stores with consistent employee schedules also increased five percent.
One explanation behind the improvement is that managers handling scheduling made sure to give preference to more experienced employees.
“It looks like managers did the rational thing — they had to improve stability, and so they picked the more experienced people,” Saravanan Kesavan, one of the researchers on the project, told The New York Times. “Now you have more experienced people in the store, and the productivity you’re seeing increased, leading to higher sales.”
In an article on Slate, the researchers from the University of California, the University of Chicago and the University of North Carolina, wrote that their study shows a flaw in conventional wisdom, which holds that on-call scheduling is necessary to meet the demands of customer traffic flow to stores.
In reality, only 30 percent of variation in staffing could be attributed to shifts in store traffic. The vast majority of schedule changes, particularly the last-minute variety, were tied to issues connected to headquarters activity. Schedules might suddenly be altered, for example, when corporate executives drop by a store, requiring staff to go into overdrive to make it look just right, or when shipments arrive on the wrong day, or a “30-percent-off promotion changes to a 40-percent-off promotion and all the signage needs to be changed.”
One potential added benefit to more consistent scheduling not included in the study is a reduction in employee turnover. It stands to reason that workers who can plan childcare, doctor visits, etc. without concern that their plans will be upended are going to feel better about their employment than those who cannot.
Discussion Questions
DISCUSSION QUESTIONS: Does your experience support this new research, which shows more consistent scheduling of associates leads to higher productivity and sales in stores? Do you agree that the vast majority of scheduling challenges in stores are tied to corporate activity and not the ebb and flow of customer traffic?
Poll
BrainTrust
Joanna Rutter
Marketing, Dor
Neil Saunders
Managing Director, GlobalData
This supports conventional thinking – treat employees well and they reward you. Treat them like minions and you hurt yourself. Sorry apps and algorithms, retail is still a human business with people expecting to be treated as humans first.
Despite the advances made in workforce management technology, staff scheduling remains one of the biggest challenges for retailers – it’s also one of the biggest opportunities. A large part of my work is understanding the impact of staff scheduling on in-store conversion rates and I can say categorically, even some of the most successful retailers are misallocating or misaligning their front-line staff resources. Staffing to traffic is still very much an important principal of effective labor management, however it’s how you staff to traffic that’s the critical insight of this study. Not all staff are equally experienced/skilled or being deployed effectively (i.e. tasking vs. serving customers) — staff scheduling to traffic without considering conversion rates leads to suboptimal results.
Even if scheduling algorithms are tied to data about shopping patterns, the lack of consistent shifts is one of the biggest causes of associate turnover in retail. It’s hard for even entry-level employees working part-time hours to be clueless about when (and for how many hours) they will be working during a given week — especially since many work at multiple jobs and their other employers expect some predictability.
So there is no surprise that more consistent shifts lead to reduced turnover and greater associate loyalty — which in turn will lead to higher productivity and (not least) reduced costs of training new employees.
Since most retailers have the tools to study the ebb and flow of customer traffic (by month of year, by day of week and time of day), it is not difficult to generate predictable schedules. I concur with my colleagues that employees are happier if they can plan their personal and work life reliably, and that happy employees generate more enthusiasm and sales. There may never be an optimal staffing formula except in environments in which retailers employ large numbers of associates in multiple departments and may be able to shuffle people among the departments that need them the most.
Wholeheartedly agree! The tools exist and are ready to be deployed and used for retailers who care about reducing turnover and increasing sales. You’re right: It really isn’t that difficult to staff to customer demand and create predictable schedules. All you need is a good foot traffic analytics system and a mindset of creating a healthy, sales-optimized staff schedule. Easy peasy from there!
“Schedules might suddenly be altered, for example, when corporate executives drop by a store, requiring staff to go into overdrive to make it look just right … ”
We all know this happens. And we all know how absurd this kind of thinking is. The most important person entering any store is the customer. Make the store “just right” for them, not for management.
Many corporations often say “employees are our greatest assets” but in practice, they’re often not treated that way, especially in retail. It absolutely makes sense that having a consistent, stable schedule makes employees happier, and therefore more productive.
We’ve all heard horror stories of “clopening” shifts and employees promised full-time hours but in reality only working part-time. From my personal experience in hiring/retaining employees in the retail industry, being able to offer a consistent schedule made a world of difference.
I wonder why we need a study to tell us something that is obvious.
If you are an hourly associate would you rather have a set schedule and know when you are going to work or not? If you had to develop a set schedule, when would you book your best people to work and who would you give the best shifts to? Poor scheduling is caused by lazy managers and poor policy.
When I first heard of retailers requiring their employees keep their schedules open so if they’re needed, they drop everything and come to work, I thought it was kind of nuts. That ideology puts employee’s value at virtually zero.
I know people need money but it’s really no wonder that those with consistent schedules are more satisfied and therefore better employees. With the resurgence of the store and retailers’ emphasis on creating a better experience, as I’ve said before, it always ends at the associate level — so you better get that right.
They seem to be using a rather generous definition of “corporate activity,” at least insofar as I associate the latter with being capricious. But “shipments arrive on the wrong day” hardly falls into that category. And more to the point, it’s an unpredictable event that would impede “consistent” scheduling. So this seems to be an affirmation of the (seemingly obvious) point that unexpected events cause problems.
All that having been said, I’ll agree with the point — and I imagine everyone else — that avoiding randomness in scheduling is a good thing.
Is this really any more complicated than what we’ve been saying on RetailWire for a few days now? Treat your store associates well, and they will deliver increased productivity and a better customer experience. Making scheduling easier and more consistent seems like an obvious practice resulting in happier employees and therefore better overall performance, i.e. sales.
I recall hearing a Macy’s HR VP at a conference about a year ago or so speaking about the new mobile app for scheduling they had introduced for their associates. It allowed them to make requests for their own schedules easily and define their desired, consistent schedules for approval by the store manager. Macy’s measured success with this app by a reduction in “no shows”, reduction in late arrivals, less schedule swapping among employees (although the app allowed you to do this easily) and an increase in employee satisfaction, plus — you guessed it — an increase in store sales. It really should be that easy!
This is retail logic. Regular scheduling of associates leads to a more stable and productive environment, which ends up generating happier employees. This will create a more positive work environment, as down time will allow employees to better prepare the store (and themselves) for the more rigorous demands of higher flow traffic during peak hours. The stores are better prepared, the employees are prepared and KPIs like OOS, properly merchandised shelves, etc. are better managed. Why wouldn’t you want this might be a better question to ask.