In-Store Retail Solutions - Managing Culture

The Importance of Cultural Change Management

I have been involved in in-store solution deployments for over a decade; and if there is one thing that is consistently underestimated it is need to manage cultural change through a formalized process. I refer to this as a Cultural Change Management program, and insist on a minimum block of services in any engagement for which I am involved.  

In-store technology, and specifically Clienteling, is all about changing behavior. The goal is to change the behavior of the associate, of the store management, and even the customer. The associate is expected to perform new tasks (or the same tasks in a different way), management is expected to manage through a different process and perhaps use different metrics and KPIs, and of course the end goal is to influence customer behavior before, during, and after a sale. Ultimately, this can only be done through effective Cultural Change Management.

Without exception, the new initiatives that have the greatest success have been rooted in a commitment to improve the behaviors and specific activities of the sales associates and in-store managers in a managed and controlled fashion – and from the top down. Simply deploying a new technology is not enough. However, deploying technology with the appropriate foresight, planning and monitoring can pay tremendous dividends. These dividends come in the form of increased organizational commitment, improved service levels, increased associate productivity and increased sales and margin.

The following highlights what I believe to be the ideal phases (and steps within each phase) in any change management program. I must admit that few retailers will go through every one of the steps, but I encourage them to do so, as each provides incremental value.  

The six most important phases are:       

• Business Impact Analysis
• Change Management Assessment
• Change Management Strategy
• Program Design
• Execution/Training
• Monitoring and Review 

Business Impact Analysis

Goal: to assist the retailer in articulating the anticipated Return on Investment and the desired impact to the business of a full roll-out. The Business Impact Analysis provides very meaningful numbers that can serve as the foundation for an effective program. It includes the following:   

Baseline Analysis – The Baseline Analysis should provide valuable insight as to what is influencing customer behavior today and therefore what activities should be encouraged tomorrow. For example, most retailers are quite familiar with basic metrics such as average transaction value, average items per transaction, and customer frequency. However, they likely do not know how these are impacted by the customer/associate relationships. In other words, what is the average transaction, items per transaction and customer frequency when a customer shops with the same associate? In most instances this relationship significantly impacts these numbers – often more than doubling each of the metrics listed. A Baseline Analysis identifies this sort of direct correlation which can then spotlight the activities required in the store, as well as provide a baseline for modeling future impact.

Business Impact Model - The Business Impact Model is designed to model the likely benefits of an in-store initiative, and the future benefits. It can be used for ROI purposes, as well as for a compass for success.  While a number of metrics may be considered, a typical Business Impact Model will include assumptions related to such things as increase in Traffic, Conversion, Average Transaction Value, Margin, Frequency, etc. As described above, the Baseline Analysis will often provide real-world numbers which can be extrapolated across a larger set of customers to provide very realistic, and often enlightening, business impact.    

Change Management Assessment

Goals: to discover the overall goals and vision of an in-store initiative, as well as to define the business activities and best practices that are to become institutionalized. To design and manage the process and implementation of the application in the store, in order to assure the greatest success.

Visioning – A Visioning session is designed to allow key stakeholders at the corporate level (typically not store level) to fully articulate the goals and vision of an in-store program. A critical element of any such initiative is total alignment to a common set of goals and long-term vision. As part of this Visioning session, the retailer should establish a set of Key Performance Indicators (KPIs) that will be the primary focus of the program, as well as articulate how the business will be different in six months, one year and beyond (customer engagement, associate management, internal communications, etc.) By understanding the specific goals and metrics that will be tracked to validate successful execution, the retailer is in a much stronger position to design a program that targets a specific end result, and keeps focus on very specific long-range goals.   

Discovery and Assessment - The Discovery and Assessment process is performed in order to assess the current capabilities within the organization, and to identify any gaps that should be filled for optimal success. This is a critical review of technology capabilities, data availability, systems functionality, as well as existing engagement models (Campaign, Credit Marketing, Loyalty, etc.), and to look for opportunities to leverage or shore up these capabilities through the new in-store program. This discovery and assessment process will also highlight potential risks to a successful implementation.

Best Practices Session – The Best Practices Session is a review of current in-store practices. This review will result in a summary of current store-based operating practices gained primarily from observations in-store. While existing corporate policy may define certain activities, it is extremely common to find that what actually happens in the store is quite different – sometimes much better, and sometimes worse. This is an assessment of what happens in the stores today that works, what does not work, and what should be happening but is not today. One-to-one interviews with top associates can be quite helpful in understanding the process they follow, gaps in existing system capabilities, and wish list items for the future. The end goal is to define four to five “best practices” that can be standardized and institutionalized across the organization.  

Training Capability Assessment - The Training Capability Assessment is performed in order to define the current training capabilities and resources within the organization. Training methods, approaches and materials should be discussed, with an end goal of identifying the likely training methods, internal training strengths, and areas of weakness that can be shored up. Areas to include are associate training, store management training, regional management training, and IT and Administrator training.

Change Management Strategy

Goal: after a complete analysis and assessment of current needs and goals, it is important to define the following three strategies:   

Communication Strategy - A key element to any effective change management program is the Communication Strategy. The Communication Strategy sessions should focus on the who, what, when, where, and why of communicating throughout an in-store implementation and subsequent roll-out. The focus is on what is communicated to key stakeholders including executive management, regional and store management, as well as the critical communications with the sales associate. Topic should include:

• Awareness – is everyone aware of the goal, and why a specific action is required?
• Desire – how do we motivate the individual to participate in the change (goals, contests, rewards, etc.)?
• Knowledge – how do we assure the individual possesses the knowledge needed to make the change (selling skills, computer skills, solution training, etc.)?
• Ability – are all of the tools in place that will enable the individual to complete the task at hand (solutions properly configured, appropriate letter templates created, etc.)?
• Reinforcement – is there specific monitoring needed to provide valid and consistent reinforcement?

Monitoring Strategy   - Effective change management can only take place through monitoring and feedback. As such, the monitoring strategy is critical to providing the information that is to be used to evaluate success and compliance, as well as to give the feedback needed to make minor course corrections if results are not what is anticipated. The monitoring strategy focuses on identifying the key metrics (KPIs) to be tracked, how they are to be communicated, as well as how to most effectively use the feedback at all levels of the organization. 

Training Strategy – Tied closely to the communication strategy, the training defines the specifics of how associates are to be trained both in reinforcing of sales processes as well as on the software solution itself. It may include the types of associates to be trained based on selling skills and technology proficiency, as well as the most optimal approach to getting associate engagement. Additional strategy should be formed that focuses on how to engage managers and others (i.e. Champions and training personnel) to become the most effective in their roles as well – ultimately empowering associates through use of the solution.

Program Design

Goal: to assist the retailer in designing very specific programs to be used in supporting an in-store technology initiative from the communication, training and monitoring perspectives. Program design may include such things as naming the initiative, identifying the appropriate mission statement, developing key messages and media to be used, as well as a host of other material preparation.

Training Program Design – Training Program Design includes the creation of specific training materials and processes for all user types (admin, manager, associate, etc.) and all training phases (phase 1, phase 2 and follow-up). The program design will consist of defining and creating specialized programs for step by step training (such as Seven Steps to Success), as well as materials to be used for pre-live, go-live and follow-up sessions.  
 
Communication Design – Communication Design includes development of communication documents, reports and dashboard elements to be used by each of the levels within the organization. Communication design may include such items as dashboard or report views for Executive Management, exception reports for Store or Regional Managers, as well as core messaging for associates. The primary deliverables for associates include pre-launch communications (with appropriate message and branding considerations), Go-live communication documents, as well as updates, monitoring and feedback documents or reports.  

Monitoring Program Design – Monitoring Program Design includes the creation of key reports, metrics and dashboard that provide the feedback required for each level of the organization. Tied directly to the Communication Strategy and Design, the Monitoring Program makes sure that all key metrics are available in the appropriate format for the specific user. The Monitoring Program Design assures the appropriate data elements are available and articulates the reports and dashboards required to deliver them.  

Execution / Training

Goal: to execute on the previously defined strategies. To provide training to the store associates, managers, and administrative staff. The training for the store associates should consist of basic sales training intended to support articulated best practices as well as application training. Training for managers should consist of methods and tools used to support best practices, coaching of associates, and application training. Administration training typically consists of environmental overview, application configuration, and Admin application training. Training may often come in phases, with pre go-live training as well as phase 2 follow-up sessions. Training methods may include CBT, Train the Trainer, Classroom training, WebEx training, etc. 

Application Training – The in-store training performed in this phase focuses on the identified best practices the retailer wishes to implement. This training covers a refresher on the basics of selling (i.e. customer contact, needs identification, presentation of merchandise, close of sale) as well as more advanced selling concepts designed for up-selling, cross-selling and suggestion selling.  This training may also cover the general best practices of selling including such things as outbound communications, follow-up, proactive selling, appointment / tickler practices, etc.

Admin Training – The training for management and administrators will allow them to become proficient at basic setup and configuration of the technology solutions. This would include setting up associate data, permissions and security settings, creation of custom form list data, etc. In addition, this training also helps to define how the identified sales practices can be further automated, or how messaging technology might provide assistance through prompting or recommendations.

Manager Training – The training provides the skills required for gaining compliance, identifying opportunities, augmenting best practices, identifying coaching opportunities, coaching, and feedback. It also typically includes training on the use of the application, use of “team” functionality and an overview of monitoring, coaching and opportunity assessment.

Follow-Up Training – Follow-up training provides additional training for subsequent phases or refresher training. These sessions are typically on-site with either in-store associates or with the training department (particularly relevant with a phased training approach). Follow-up training can be a critical element to the entire change management approach, as problem areas or specific individual strengths can highlight the most important areas to train.  

Monitoring and Review

Goal: To monitor compliance and success relative to pre-defined KPIs, and  to locate training and coaching opportunities. Monitoring also provides the ability to highlight areas of great success, or areas with lack of success, which can then provide incremental course corrections or new strategic initiatives.   

Monitoring and Review –The establishment of Key Performance Indicators (KPI’s) is crucial at the outset, as it provides measurable benchmarks needed to gauge success. In addition to setting the benchmark and goals, monitoring behavior and usage from the beginning of the application roll-out identifies knowledge areas or desired practices that need additional focus.  This may include mentoring individuals that are not completing the tasks assigned to them, individuals that are less effective than the average, or even practices that are not producing the desired results. By refining the processes in a scientific manner, the retailer is in a better position to act quickly and respond appropriately once an issue has been identified.  New standards and benchmarks may be established as the organization improves, and as new practices are implemented over time.

Conclusion

Implementing new processes and procedures at the store level can have less than desired results, if not effectively managed. Day to day activities are typically rooted in the culture of the organization, and without planning for changing this culture, most organizations fail to see the full benefits of any new initiative. And the more people who are relied on to implement a change, the more challenging this becomes. With in-store technologies, a retailer is hoping to affect change with what is most typically the largest group of employees in the company. As a result, effective Cultural Change Management is a must.

Without exception, the new initiatives that have the greatest success have been effectively managed from the top down. Without a clear mandate from Executive Management, most initiatives will fall short of expectations. An effective Cultural Change Management program should consist of a set of progressive phases, each building off of the prior. These phases must define where you are today, where you wish to be, a strategy to get there, an execution plan, and the appropriate monitoring and review. Without a comprehensive approach, retailers will fail to see the full potential of any in-store initiative.