06/18/2012

Beat Showrooming with Advanced WFM

Editor at Large

By Joe Skorupa

In a world where showrooming threatens the future of stores, retailers have a renewed sense of urgency to increase customer service and deliver a better shopping experience. The best way to achieve this is by incorporating data sources that measure customer satisfaction in optimization recommendations and KPIs used in BI dashboards. A new study shows that retailers are taking an increasingly customer-centric approach to workforce management (WFM) tools in the battle to win the showrooming war.

Retailers now have a sense of urgency to improve the store experience like never before as Amazon and other online retailers hijack their customers with mobile apps that scan store products, offer low prices and arrange for home delivery, a phenomenon known as showrooming.

In a study posted in this blog last week we saw that retailers believe the best method to combat showrooming is to emphasize personal in-store services, which was by far the top choice selected by 39% of retailers.

In a new study just posted on the RIS website, one of the key takeaways is that the best way to beat showrooming and raise the level of in-store services is through the strategic use of WFM. Here are some key findings from the study:

No doubt controlling labor costs and improving store productivity is the top mission assigned to WFM software, but coming in a close second is using analytics to leverage customer satisfaction KPIs, which was selected by 45.5%. Without customer satisfaction data retailers operate blindly and become prey to unforeseen consequences, such as longer lines at checkout that can cause lasting damage to loyalty, sales and the brand image. This can be avoided if retailers keep a finger on the pulse and make tracking customer satisfaction a widely distributed KPI.
Task management tools have been rolling out through retailing for several years, but now retailers recognize that its ability to micromanage productivity tasks will not by itself improve store sales. As a result, we find that nearly two thirds of respondents (64%) say they want to shift their task management processes to focusing on sales and customers. This is a major endorsement of adopting a customer-centricity strategy as a way to combat showrooming. In today’s highly competitive retail environment, which has some experts raising the specter of the death of stores, strategies that focus on sales and customers trump efficiency and cost cutting.
The top WFM technology that retailers will start to deploy by the end of the year is integrating time and attendance data with forecasting algorithms. At one time time and attendance was the least sexy solution in the WFM tool box, but today it can be used to improve lunch break timing, reduce overtime charges, and increase payroll accuracy. When powered with forecasting algorithms these tools not only account for associates being physically on premise, but they also help analyze what is and what is not productive work time.
One interesting point to note is the ranking of WFM technologies deployed on mobile devices. For technology currently in place or those currently being deployed, mobile WFM projects are at the bottom of the list. However, for future deployments starting in 2012, they rank second (30.8% for task management software with mobile device support) and fourth (23.1% for mobile device apps to request associates in store). Clearly, the future of WFM is mobile.
One challenge holding back many retailers from improving store performance is the complaint that staffing levels are not adequate (chosen by 38.7%). As sales have slowly but steadily picked up over the last 12 months, hiring has lagged and placed a strain on sales and customer service. Another challenge cited by retailers is weak or low employee morale (35%). Dispirited associates communicate displeasure to customers with damaging results. Frequently, the cause of low morale is inadequate staffing during peak periods, and so these two challenges are often related.
Just 33.3% of respondents say their WFM solution meets their needs today and for the foreseeable future, which is not great news for the vast majority who are experiencing some level of pain due to software constraints. The “pained” group includes 45.5% who say their WFM will not meet their needs within two years and risk hitting a wall. This group also includes 21.2% who say their WFM

The flashpoint between serving customer needs and dealing with pressure to do more with less is a source of conflict in stores today. Fortunately, advanced WFM solutions have matured to the point where they can effectively balance these competing missions, especially if they are integrated with new data sources and incorporate customer satisfaction concerns.

Most retail organizations have long used analytics to optimize inventory, pricing and forecasting, but many have been slow to extend analytics in an effective way into their WFM solutions. This is beginning to change as retailers begin to adjust their view of WFM as a point solution to an enterprise solution with omni-channel capabilities.

Related Stories

Mapping Omni-Channel WFM

What Will It Take for JCPenney to Succeed?