Should retailers incentivize store staff to accept digital transformation?


Discussion
Photo: RetailWire
Jun 12, 2018
Matthew Stern

While adopting new technologies may be necessary for brands and retailers to remain competitive, it’s not always easy. Establishing internal buy-in at every level can be one of the biggest hurdles. In a session at the Internet Retailer Conference and Expo (IRCE) in Chicago last week, Kara Strong, strategic information officer at Bassett Furniture, and Jim Okamura, partner at McMillan Doolittle, explored the challenges retailers face trying to get staff on-board with technological enhancements and the need for an internal PR push to make it work.

Bassett Furniture was founded in 1902 as a wholesaler and began its retail operations around 18 years ago. The retailer has 94 stores and offers hand-made highly-customized furniture, which customers can work with designers to create directly to spec.

“Any time that you have that kind of heritage, it often comes with a little bit of complication,” said Ms. Strong.

“The reality is we know that for many companies they have been challenged by the execution of the omnichannel strategy. For the vast majority of retailers, they’re somewhere in the area of ‘yeah we understand, but we may or may not fully accept it’ and ‘what does this do to my bonus, by the way?'”

In the case of Bassett Furniture, the company was able to generate buy-in among furniture designers by demonstrating with data that a new, improved website with digital features like online chat and booking was actually bringing more money into individual stores.

“What we’ve learned is that we’re sending a more qualified consumer into our store,” said Ms. Strong. “Our designers are closing more frequently — they’re closing at a higher rate.”

Ms. Strong’s team also demonstrated the new customer journey to store-level staff and executives, showing where the stores fit in and how the online part of the business was pushing customers into stores.

These moves were in keeping with Mr. Okamura’s suggestions. He cited two critical components to a successful omnichannel implementation:

  1. Having a job role that facilitates communications between departments during a digital transformation, and;
  2. Using analytics and setting KPIs to sell digital transformation internally.

DISCUSSION QUESTIONS: What sort of hurdles might those in charge of digital transformation encounter, and how can they overcome them? What steps would you suggest retailers take to get their internal staff comfortable with digital transformation?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"It is absolutely all about communication. "
"Change management is tough. With digital transformation change management is even tougher."
"I’ve been on the front line of leading and facilitating this kind of change, and one thing is for certain: incentivizing fails."

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19 Comments on "Should retailers incentivize store staff to accept digital transformation?
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Mark Ryski
BrainTrust

Getting alignment from front-line staff on new digital initiatives is critical to success. Any new initiatives that potentially impact front-line employees’ workload and/or compensation should be managed carefully and proactively. The key is to show employees how the new initiatives will be beneficial to customers, the business and ultimately to the employees themselves.

Art Suriano
BrainTrust

Most people don’t like change, and when it involves learning a new technology they often want it less. That said, new technology is everywhere, and there are those who embrace it and those who fear it. The smart retailer will use technology as a better way to service customers and not as a way to eliminate human interaction.

That’s the first point that needs to be addressed and shared with all employees. Assure them that the new technology is there to help them and not hurt them. Provide the necessary training so they can quickly learn how to use the latest technology and let them see for themselves the benefits. So the real answer is active communication with employees. Avoid them fearing for their job and help them embrace the new technological tools. Not everyone will adapt but the majority will and, in the end, you’ll have great success for the customer, the employee and the retail business.

Dave Bruno
BrainTrust

As a provider of technology solutions that often impact the daily routines of thousands of store associates, we have learned that “incentivizing” adoption can – and should – take many forms. Internal PR campaigns are an absolutely critical part of the process, but these campaigns alone are rarely enough. The most successful change management programs we see always include a combination of PR and promotions, regular and authentic communications, reports from the field (particularly from pilot stores and early roll-out stores) and, finally, evaluations, including both feedback from associates and concrete metrics from stores after they adopt the new technology. We rarely see monetary incentives and, when we do, they are typically less effective than well-coordinated and well-communicated change management programs.

Jennifer McDermott
BrainTrust

It’s incredibly difficult to implement a seamless roll out of new technologies in-store, particularly when you are dealing with young, part-time and, in some cases, disinterested staff. It’s important that those who are directing the changes be very aware of the challenges impacting teams at store-level by actually spending time in stores for top-down training. Usually a phased approach is best to get teams informed and feeling comfortable.

Bob Amster
BrainTrust

This is a topic I have discussed on forums and with retail clients. The reality is that compensation models have to change to accommodate the fact that there are new functions to be performed in stores. Stores can be responsible for online sales and vice versa, and they are also responsible for processing returns of product they didn’t sell. The solution is to test and determine the compensation paradigm that works best for each retailer. Straight compensation based on sales doesn’t work anymore just like it doesn’t work to measure same-store sales in an omnichannel model.

Joanna Rutter
BrainTrust
4 months 6 days ago

We know the top-down cliche: Upper management or capital-C Corporate is sold on a silver bullet, ships it to stores, and associates are left holding the bag of implementing a new CRM, new POS, new foot traffic analytics solution, new BOPIS workflow — without adequate explanation from their leaders as to why it was considered, how it can benefit them, and the KPIs they can help to deliver using this new tool. It is absolutely all about communication. The corporate-to-store-chasm is often far too wide, and one all-staff email with an attached PDF explaining a complex new piece of tech is not enough to get crucial associate-level buy-in. Developing great internal communication — including surveys and store visits to get feedback from different roles, so the deployment is not that top-down, one-off cliche — is vital to ensuring that digital transformation is holistic and lasting.

Nikki Baird
BrainTrust

It comes down to Change Management 101. Prepare people for change. Make a case for change, make it personal so that they understand what it means to them specifically, and to demonstrate that you’ve cared enough about what it means to them personally that you’ve thought about it. Then follow through on the change. Then come back around and deal with the unplanned consequences of change.

Retailers can approach transformation one of two ways. They can just wait for their existing workforce to turn over (good luck with that strategy if you want to be authentic and genuine with consumers), or they can approach their existing workforce head-on and be transparent and caring about the impact. But if you think that you might not need to address it? I have no hope for YOUR company’s future!

Mohamed Amer
BrainTrust

Let’s be honest here, people don’t like change because of fear. Fear of not knowing if they’ll be successful in the new way of doing things and fear of losing their paycheck or having it reduced.

Success in any change program — big or small, company-wide or only in one department — will be based on how well management addresses the fears of the front-line worker. It’s not rocket science, it’s human nature. The former has precise mathematical formulas, the latter involves human emotions and is a people business.

Brandon Rael
BrainTrust
Taking all the digital transformation and omnichannel complexities out of the picture, from the perspective of the store associate, they are under tremendous pressure to perform on the job and are on the front lines representing the brand. It is absolutely critical for retailers to evolve, support and develop their front-line store associates into brand ambassadors who have the right training, tools and capabilities, in order to stay on an even playing field with the digitally-empowered consumer. Change management, training and incentivization programs are important to helping the store associates evolve. Yet these are often the most overlooked areas of any transformation. On too many occasions, companies focus on the technology solution without considering the impacts to the employee journey, which has a direct impact on the customer experience. Any digital transformation requires significant support, sponsorship and buy-in from the retail executives on down to the store associates. The true incentivization comes with the retailers prioritizing and understanding the importance of the store associates as they evolve in true brand ambassadors. With the right solutions… Read more »
Anne Howe
BrainTrust

All efforts to facilitate communications, and especially those that can include the consumer, are bound to have a positive effect on the business results. I’m very glad to see an old-school furnishings brand taking a lead role here. That industry is ripe for change that empowers shoppers!

Lyle Bunn (Ph.D. Hon)
BrainTrust

Digital experience for the consumer should also result in more productivity for staff and the enterprise. At Sports Chek, which has been recognized with many retail media awards, the key to success was the integration of dynamic signage and touch screens into the conversion/cross-sell/upsell process by associates. Cell phone and electronics retailers have done similarly as associates can see a customer from afar and then assist the sale as options are narrowed. When technologies allow the customer and associate to stand shoulder-to-shoulder toward a desired outcome, rather than the traditional face-off/us-them model, relationships happen and loyalty is developed.

Ray Riley
BrainTrust
I’ve been on the front line of leading and facilitating this kind of change, and one thing is for certain: incentivizing fails. The future role that manages retail learning and development needs a total overhaul just as the future front-line retail sales professionals and managers need more than a features, advantages and benefits card with a new range of merchandise. These front-line staff will be taking on more and more over the next five years. As alluded to in the article, that learning and development job role facilitates in-person and virtual training for any new transformative initiative that will integrate with brick-and-mortar. Every individual who interacts with a customer must be reached somehow. The learned and development individual must be capable of explaining WHY this initiative is headed into stores in a way that resonates. They must be clear about WHAT the impact will be for customers (most importantly) and how it makes the sales professionals’ role easier — with the potential for increased sales/commissions. Then it simply comes down to HOW execution happens, and… Read more »
Ralph Jacobson
BrainTrust

Any change in internal process, be it technological, manual, cultural or otherwise, requires a certain incentive to help staff adoption. That incentive need not be monetary by any means. It can be helping with a workload, improving a work schedule or providing a cashless bonuses. I think digital transformation is only one aspect of staff collaboration that requires a coordinated approach to succeed.

Adrian Weidmann
BrainTrust

The short answer is yes! Shoppers are using digital technology to search, explore and educate themselves on what they are seeking. Price, warranty, comparisons, features, capabilities, resale value and consumer reviews are all happening digitally before prospective shoppers leave their homes. Shoppers expect that their in-store experience should be a continuation of that journey — not anything less! Sales associates should have the means and the tools to enable them to react to their guests, and retailers need to make certain that their staff is educated and incentivized to meet these expectations. I work with FCA and they are currently incentivizing their sales associates across 2600+ dealerships to use a mobile application with an embedded, standardized sales process that is measurable. This same program has relevance in a broad range of retail environments.

Sterling Hawkins
BrainTrust

Change causes upset. Creating a culture that supports employees embracing and even creating change is step one (and is even more important as innovation accelerates at an increasing rate). Step two is more about developing the skills necessary to operate in a digital world. As employees can see both the “how to” as well as the benefit to the business, shoppers and themselves, the transformation can become more natural.

Michael La Kier
BrainTrust

Change management is tough. With digital transformation change management is even tougher. Building in new technology is only helpful if internal staff and shoppers use it. And if adoption stops with staff, it will not expand beyond them.

Cate Trotter
BrainTrust

I think before we even talk about incentivising staff we should be concentrating on informing them. For many retail employees new tech and developments come with the threat of a loss of jobs which can make them resistant or fearful of change. They may even reject new ideas outright if they perceive them to be damaging to their role. Retailers could help solve a lot of these issues just by communicating better with their staff about any changes or new technologies, why they’re being made, and focus on the benefits to the staff — how will this make their lives easier? Then comes the task of properly training staff on how to use digital systems. Whether you then need to incentivise them further is an interesting question — the example above deals more with designers, rather than say store staff, who are incentivised by the increased sales. Staff on the shop floor may need a different tack.

Ken Morris
BrainTrust
Omnichannel retailing makes retail more complex and challenging. From an associate perspective, gaining buy-in and motivating them to embrace new technology and help facilitate omnichannel fulfillment is imperative for success. The first step is to effectively train staff on new technologies and processes. Offering training in multiple formats (written processes and steps, online videos and in-person trainers/managers) is advised as people learn in different ways. Effectively motivating sales associates often hinges on compensation, as money is a big motivator. Sales associates need to be compensated for non-revenue generating activities, like fulfilling online orders that that don’t generate commissions. Sales attribution is becoming a complex issue with the advent of cross-channel shopping. Omnichannel retailing is, or should be, changing the way retailers evaluate their business performance and sales compensation. Since the shopping journey is often cross-channel, it is short-sighted not to consider the indirect influence and impact each channel has on the other channel’s sales. Maybe we shouldn’t be even trying to attribute sales to a specific touch point like the “last-touch” model, as the consumer’s… Read more »
Mike Osorio
BrainTrust

Joanna Rutter and Dave Bruno are spot on in their comments. Any material change to job functions, workflows, compensation, or customer interaction requires a robust change management process. Technology based change adds to the necessity of such a process.

Having led many change processes, I know the pain of missing any of the necessary stages of change management. This is absolutely not rocket science, although most organizations struggle with committing to the entire process due to misunderstanding and overly aggressive implementation timelines and budget restrictions. If you can’t afford or have the patience to properly manage digital or any other significant transformation, don’t start. However, to be successful, you can’t afford not to transform.

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Braintrust
"It is absolutely all about communication. "
"Change management is tough. With digital transformation change management is even tougher."
"I’ve been on the front line of leading and facilitating this kind of change, and one thing is for certain: incentivizing fails."

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