Never mind consultants, some of the best business improvement ideas come from the shopfloor. Collectively, ideas from staff have helped retailers rake in millions by capitalising on missed opportunities and prevented millions more from being squandered down the drain.
The emphasis on listening to those at the coalface is a modern-day retail phenomenon. And one retailer renowned for this is Asda. Last week, six of its store employees each had the nerve-wracking prospect of pitching their strategic plans not only to the supermarket’s top directors, but also the often acerbic Dragons’ Den entrepreneur Peter Jones.
It was the final of Asda’s very own Dragons’ Den-style competition and more than 250 staff ideas had been whittled down to a shortlist. Aside from Jones, judges included Asda chief executive Andy Bond, financial director Judith McKenna, strategy director Douglas Gurr, and last year’s winner Matt Baker.
The competition is about finding big, strategic ideas for business change. Those on this year’s shortlist ranged from an in-store party planners idea to eco-fridges for use in depots. The winner, Chris Thompson from Hull’s Kingswood store, devised a “seed-stacked flapjack” containing only healthy ingredients. He will work in head office for three months to help develop the product and packaging for Asda’s Good For You range.
The notion of tapping into the creativity of store staff is not new. Frank Winfield Woolworth, who founded the eponymous general merchandise retailer in 1878, used to invite all store managers to his home twice a year to ask for their ideas on store and product improvement. However, the way in which retailers gather such information has certainly evolved.
Former Asda chief executive Archie Norman, who in the 1990s brought about a reversal in the grocer’s fortunes, was famed for the importance he attached to listening to store colleagues. He introduced his “Tell Archie” scheme in 1992. Initially, Norman wasn’t keen on its title. “I didn’t really want my name all over the place,” he recalls. But Julian Richer – of Richer Sounds, whom Norman had brought in to help revitalise the business – advised the opposite. “He said: ‘You’ve got to call it Tell Archie, because people need to know it’s going to go to you. People don’t naturally want to write letters, so you’ve got to make it friendly’.”
The name has stuck and it’s now, unsurprisingly, “Tell Andy”. Each store has a representative who collates the various ideas circulating. If an idea is specific to that store, it is reviewed locally, but if it’s more generic, it comes through head office, where every idea is assessed. One member of staff, for instance, suggested using energy-saving light bulbs on old-fashioned checkouts that light up when the checkout is being operated. An Asda spokeswoman says: “If you think of the number of stores that still have these checkouts and the fact that some are open 24 hours, that’s a lot of electricity.”
Sainsbury’s “Tell Justin” team investigates all suggestions and discusses them with the relevant board director. It aims to respond to every letter within eight weeks. Successes include a suggestion by Dan Apsley, transport supervisor at Sainsbury’s Hams Hall depot near Birmingham, that the company change the delivery route to one of its stores. The switch resulted in significant cost savings on fuel and thus helped reduce its environmental impact.
B&Q has several suggestion systems in place. For example, Ian Cheshire launched “Cheshire Chat” in 2005. B&Q director of organisation development Nathan Clement explains: “It gave Ian the chance to sit down in store with employees of all levels in an informal setting, with no set agenda, apart from a basic rule that criticism should be constructive.” These schemes have led to changes such as the introduction of store uniforms specially cut for women and a repositioning of B&Q’s head office to be squarely in support of stores – it is now known as the store support office.
Another system is its Orange Room, where departments meet and receive live responses from link-ups with store management teams across the country. Feedback from store staff has led, for instance, to a new range of rugs and a new point of sale to communicate this to customers.
Both Ikea UK country manager Peter Høgsted and Euan Sutherland, chief executive of AS Watson’s health and beauty business, have blogs on their company intranets. Ikea information and creative services manager Lois Blenkinsop says this is the perfect vehicle to encourage store staff to contribute to the business. “These people are meeting customers every day and they’re often closest to the product. They see first hand what’s working and what’s not,” she says.
Sutherland agrees that the blog is an effective way of staying close to what’s going on across the business. Key, though, is making sure that content is lively, relevant and visual and that everyone receives a response. “I really enjoy the interaction I have with team members – the feedback and suggestions constantly keep us on our toes,” he says.
Success stories
Ikea gives “Ikea Stories” leaflets to every employee. Høgsted says his intention in publishing these is to “put Ikea culture back on the agenda”. The aim is to publish inspiring stories from colleagues – some of which refer to how their ideas have made a difference to the retailer.
Norman warns company culture is crucial if you want a meaningful staff suggestion scheme. “If you have a top-down hierarchical culture, it won’t work; employees can see through that very quickly. Nine times out of 10, it ends up being a PR exercise and being propelled by HR managers, who can resent it, rather than by line managers.”
Comet head of HR Julie Hendey says that, for that reason, a mix of informal and formal methods of suggesting ideas works best. “Colleagues will feel comfortable communicating in different ways,” she says. The involvement of directors is crucial, adds Hendey. “Our operations director Mike Rooney is fantastic at engaging people in the stores. People with the ideas don’t always think: ‘Nationally this could do x, y, z.’ They’ve just got an idea of how to do things differently,” she explains. For example, Rooney has implemented merchandising ideas that are likely to make thousands of pounds worth of difference to the bottom line – all on the strength of talking to a warehouse colleague (see box).
Norman, however, also believes that making more of staff feedback should not just be about the ideas themselves. “If you look at this and say: ‘Right, what good ideas have we got?’, you’re coming at it from the wrong angle. Of course, some of the ideas we received when I was at Asda were highly relevant and some were off the wall, but that’s not the point. What really mattered when we launched Tell Archie was that people thought they were involved in the business and listened to,” he says.
But while the quality of the ideas will vary, there is no denying that many shopfloor staff’s flashes of inspiration have made huge differences – not only within individual stores, but often throughout an organisation. With the right support, these employees they can prove to be some of the best strategic thinkers around.
Staff brainwaves that saved millions
Paul Hales, Thorntons store manager at Manchester’s Trafford Centre, decided to install a chocolate fountain used by the shop for corporate events to sell fudge and marshmallow skewers in store. Turnover from the fountain in the first week was£2,000. A few weeks later, it brought in sales of more than£1,000 in a day. The fountains are now used in more than 100 stores. As well as attracting a younger customer, they generate annual sales of more than£1.5 million.
In 2005, seven of Ikea’s logistics projects were assigned to managers in stores. Phil Martin in Edinburgh was asked to look into alternative storage solutions. He and suppliers came up with an automated system akin to a giant vending machine. Stock accuracy and stock availability vastly improved after testing its use with storing kitchen doors. The system has since been rolled out globally and is being adapted to use with other products.
An employee in the warehouse at Comet’s Lincoln store came up with ideas for merchandising that are set to be rolled out nationally. One was to bundle essentials such as printing ink and cartridges to create a multi-buy opportunity. Another was to provide customers with the opportunity to pick and mix their cookers and hobs and introduce different ways of displaying them to customers.
Woolworths’ in-store ordering system – which enables customers to place an order in any UK store and have the product delivered to another – came from shopfloor staff. In August 2006, staff in smaller outlets were using larger stores in their area to provide products they couldn’t stock. They asked head office for support to make the system more efficient. It is now a multimillion-pound operation used across the business.
An Asda employee at Bolton’s Horwich store spotted the nonsensical practice of keeping card transaction receipts – particularly since Chip and PIN negated the need to keep them. She suggested they stop tills from printing them, which freed up till space and time spent shredding. The change was made in all stores a year ago. It has improved customer security, saved the retailer more than£1.5 million a year and helped lessen its environmental impact.
Sian Roberts at Sainsbury’s Chester store came up with the idea of providing information cards to publicise the supermarket’s glass-loaning service. It meant it was not only far better promoted in store, but it also gave customers all the details they needed in an easy reference format to take home and keep. The cards were introduced into every store, resulting in a much wider take up and increased revenue.
DSGi launched a competition to design a next-generation electrical device. The winner, a Currys store employee, designed a slimline digital “behind set” box, which meant the streamlined look of flatscreen TVs wouldn’t be spoiled by set-top boxes and wires. His idea was further developed by DSGi sourcing and a chosen manufacturer. The invention – the LDR V2 Logik – was launched in stores and online at Currys, PC World and Dixons.co.uk last October.
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