The Container Store Uses WFM for Successful Scheduling

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The Container Store Uses WFM for Successful Scheduling

By Adam Blair - 10/06/2011
The Container Store’s formula for staffing its stores with associates who provide superior customer service seems, at first glance, to be a mathematical mistake: it’s 1 = 3. But this seeming disparity isn’t actually incorrect; it’s just incomplete.
“What ‘1 = 3’ means is that one great person equals three good people, and we hire only great people,” explains The Container Store’s store systems and facilities director Paul de Freitas. The retailer not only hires top-notch, customer service-oriented people to work in its stores; it also provides them with extensive training – more than 260 hours’ worth in the first year of employment alone – and pays them at rates that are “50 percent to 100 percent higher than typical retailers of our size,” says de Freitas.

“We invest more in a first-time associate than most retailers do in [an employee’s] entire career,” he adds. In return, The Container Store employees tend to stay with the company, making for an enviable employee retention rate that’s all the more remarkable in an industry with notoriously high turnover.
“The average tenure of people who are vice presidents, area directors and managers is 14.5 years,” says de Freitas. Nor are associates required to move up and out of the store in order to have a long career at The Container Store: “It’s not uncommon to see people on the sales floor with five, 10, 15 and 20-year service pins,” he notes.

A Superior Shopping Experience
Anyone who has shopped in The Container Store can see the results of the retailer’s investment in its workforce: an enhanced shopping experience, whether you’re purchasing a simple kitchen organizer or a customized, retailer-installed walk-in closet using components from the retailer’s private label elfa brand.

The Container Store associates are able to take customers through complex, multi-step processes for these types of purchases, using computer programs with advanced graphics to create designs based on the available space in a customer’s home along with variables such as who will be using the closet and what they will be storing there.

“We sell ‘the hard stuff’ in our stores – components of solutions where the value proposition isn’t immediately visible to the consumer, with features and benefits that require a lot of explaining to customers,” says de Freitas

Optimizing Store Schedules

Clearly, The Container Store strongly believes that having the right associates in its stores is critical to its success. (The retailer has had a 26 percent compounded annual growth rate since it was founded in 1978.) In addition to its extensive training programs, the retailer uses advanced workforce management (WFM) tools from the Kronos for Retail suite to more effectively manage its store staff.

In particular, The Container Store’s recent adoption of the Kronos Scheduling with Optimization module has sharpened its ability to have the ideal mix of people working in any store at any given time, both to meet customers’ needs and maximize sales.

Prior to deploying the optimized scheduling module, The Container Store set its schedules to run in six- to 12-week cycles, with the time frame varying depending on the time of year and seasonal sales campaigns taking place.
While the retailer had some ability to set store schedules based on its history and forecasts, the standard scheduling tool “didn’t really take into account the needs of the business,” says de Freitas. “For example, we would have people working first thing on a Saturday morning because that’s a busy day overall for us, but they often weren’t serving any customers.”

mismatch of staffing levels and customer traffic was a particular problem, especially with The Container Store’s emphasis on customer service. “Where the rubber meets the road in retail is the eyeball-to-eyeball interaction with the customer,” says de Freitas. “Yes, there are things that have to happen in stores when customers aren’t there: merchandise processing, remodels and refresh projects. But the bottom line was that we needed more of our people in the store when customers were in the store.”

Scheduling optimization allows The Container Store to use multiple data points to more accurately forecast not just which days or weeks will be busy but which times within each day will see the highest volumes. “We can take traffic data as well as transaction and sales data and put it into the optimizer engine to find those traffic peaks,” explains de Freitas.

Mapping these peaks and valleys gives store managers a clearer understanding of their staffing requirements. A store manager “may need to have 16 people working in the store on a given Saturday – but he needs 12 of them to be on the sales floor from 11 a.m. to 2 p.m.,” says de Freitas. That level of specificity, provided in 15-minute increments, is “what the optimized schedule really does for us.”

The optimization module’s ability to use multiple data points helps The Container Store’s managers create job-specific forecasts. Store traffic data is used to forecast the need for floor sales associates; point-of-sale transactions and lines per transaction (the number of items in a customer’s market basket) help create forecasts for register salespeople.

“We’re looking at adding additional data drivers around merchandise processing,” says de Freitas. “We’re unique in that we run a little pick/pack operation in each store. When you buy an elfa closet, it’s a customized solution designed to fit in your closet space, so we need to pull every piece of that order individually for each customer. It’s not a prepackaged kit, it’s designed for your space and cut to your specifications.”

The retailer has in-store systems for managing these picking and packing processes, but it has not yet matched them to all the data points needed to create an accurate forecast. However, this part of The Container Store’s business is increasing, as are buy online/pick up in-store sales. “The labor needs of that function are becoming more forecastable, so we’re going to add more data elements to the schedule optimization system” to meet this increasing need, he adds.

A Need for Leaders

On the corporate level, the use of scheduling optimization has helped the retailer gain a better understanding of how its employees interact with each other and the impact that has on store operations.

“We learned that we needed our store leaders, our managers and full-time employees, to have more of a set schedule,” notes de Freitas. Only about 10 percent of a store’s staff are full-time employees, including managers and full-time sales and training associates. These people are “the ‘grease,’ the people who communicate and train others, the day-in, day-out presence in the store,” he says. “They’re not only responsible for service in the store, they also have teams reporting to them.”

When stores tried to use optimized schedules for the entire store staff – including these critical full-time employees – they found that the full-time leaders weren’t being given schedules that aligned with the team members who reported to them on an ongoing basis. “That’s not the way we want to manage our business; we want our leaders in the store to be available during the day, to answer employees’ questions, provide direction and encouragement,” says de Freitas.

The solution was to use scheduling optimization for the 90 percent of employees working part-time, and to put the team leaders and managers back into schedules that were consistent from week to week. “The [leaders’] schedules change from time to time, depending on the time of year and the needs of the business, but for the most part they are scheduled to be working when their teams will be around,” says de Freitas.

Mobility a Possibility

Looking ahead, The Container Store is considering making more extensive use of other WFM offerings from Kronos. “There are a ton of mobile features on the way from Kronos around scheduling and communicating with people,” says de Freitas. He gave the example of an employee who calls to say they have to have surgery and will be out for three days, creating several open shifts. The new version of the Kronos WFM package can send mobile alerts to those associates that are qualified for the specific job, and who have indicated their availability for these shifts. Another feature sends schedules directly to associates’ e-mail calendar programs.

Choosing the right workforce technologies is important to The Container Store, but its most crucial choices are about the people who will be using the technology: its managers and associates. “We’re hiring the best of the best, and we expect a lot of them,” says de Freitas.