Context
This retail chain was losing sales due to failing in-store operations and unsatisfactory customer service: typical problems were frequent stocks-outs and mismatches between staff shop floor presence and actual customer flow. On top they suffered high costs due to inefficiencies, e.g.: high FTE cost per customer served. Increased competition and growing importance of e-commerce made it also necessary to push the service offer towards more personalised and more professional advice in the stores, putting higher demands on store personnel. Finally, there was a need to change the culture amongst store managers and drive them from being sales experts to becoming real store & people managers with robust skills in problem solving.
Our Mission
- Professionalise in store operations and ensure consistent good service
- Reduce costs by reducing temp / interim labor force through efficiency increases
- Enable cultural/skill shift of store managers and ensure more personalised service
- Build internal Lean team that will be able to push Lean further autonomously
Results
- After 12 months: staff costs -9%, mostly without forced firing (i.e. +/- 3Mio€/yr savings)
- Sales increase 1-2% through improved service offer: professional in-store resource planning, increased personal service, strong decrease in stock-outs, cleaner and more attractive stores
- New customer-centric culture in the stores, with focus on problem solving
- 25% supply chain cost reduction by their autonomous Lean team
Approach
- Mini diagnostic to convince the whole management team of the potential of Lean retailing to address their main operational issues
- Design of a full Lean program in selected pilot stores, including required tools, procedures and IT adjustments; tuned till desired impact was reached
- CSI coaching and mentoring of internal team with a mix of managers, employees and shop managers to perform:
- The diagnostic that extended and refined the findings of the mini diagnostic through
- Mystery shopping and customer reviews
- More detailed and full network data- & process analysis
- Observations and measurements in the stores of daily routines and planning including waste analysis
- Design
- Design of a new scheduling tool for the shops
- Reorganisation of the storage rooms and the cash registers areas
- Improved shelving ergonomics and all other main routines, including cleaning
- Negotiation with the unions to implement the new procedure package
- Implementation
- Installation of all tools + procedures in multiple stores to test and tune for target impact
- Installation of a concrete store managers toolkit to allow adoption of their new role
- Design of the roll out plan, (internally) recruiting and coaching of the roll out teams
- The diagnostic that extended and refined the findings of the mini diagnostic through
- This Lean program was then rolled out throughout both networks mainly leveraging the own internal organisation
Main challenges
- Changing old habits almost engrained in DNA of more senior staff
- Installing true coaching skills with people not used to really manage other people
- Deal with negative impact from fierce competition
- Get unions on board to support the program
