Empowering employees can make all the difference
It’s pretty much a fact that we all like independent stores. I’m talking about the sort of places that offer a much richer, personal service than is typically delivered by the larger retailers. Too often the latter have disengaged employees who have little power to make decisions and this combination invariably leads to a disappointing experience for the customer.
But it doesn’t have to be this way. Whenever it comes to me getting keys cut or shoes re-heeled I’ve always looked out for Timpson shops based on the positive customer experience I’ve enjoyed and the speed with which they can turn things around.
I have on occasion sat down at the counter doing emails on my phone while waiting for my shoes to be sorted out. They always seem to be able to fit the job in immediately. This responsiveness combined with the bonhomie of their employees is very attractive. A recent profile of CEO James Timpson in the Sunday Times helped explain why I get this high level of service versus so many other retailers where I come away disappointed.
It’s largely down to the employees. From the clear focus on employing the right people and then empowering these individuals to make decisions and run the stores as if they are their own businesses. They can negotiate with customers on prices so nobody need walk away from a store feeling something was too expensive.
They also have the power to give people £500 from the till to immediately settle any complaints so there are no delays in solving issues. Store managers can actively deal with things to the ultimate satisfaction of the customer. There is also a positive social contribution as Timpson employs former prisoners and also offers free dry cleaning to homeless people who are due to attend a job interview.
These initiatives are balanced out by a bonus scheme that involves giving employees 15% of weekly store profits when sales hit 4.5-times the weekly wage bill.
Such empowerment of employees is also evident at Majestic Wine where CEO Rowan Gormley has introduced a ‘franchise-lite’ model that offers enterprising store managers the opportunity to set their own opening hours, staffing patterns, and make decisions on things like holding in-store tastings. All the initial trial stores where this model has been adopted by the mangers have enjoyed sales increases of around 9%.
These store managers are taking more responsibility – invariably with longer working hours and more complexity in their businesses. For instance, some are staying open later and hosting more tastings. These stores can be very much tailored to the local customer base. The upside for the managers is profit sharing.
Whereas the average Majestic store manager would be earning around £30,000 per year a franchise-lite manager could be bringing in as much as £50,000. Clearly this would not appeal to all managers but for others it offers them the perfect opportunity to deliver a more personalised service through a store that more reflects their personal thinking.
It is clear from the examples of Timpson and Majestic – which I’ve personally encountered – that it is possible for employee empowerment to work within the confines of large businesses and that there are different ways for it to be implemented. Whatever route is taken the result is an outlet that has more of an independent feel but is operating within the framework and branding of a large organisation.
In an era when differentiation between online and offline is increasingly about people – rather than price – it will become ever more important for retailers to empower their employees in order that they can better serve customers through a richer experience. Timpson and Majestic are proof that it can work for a variety of organisations.
Guy Chiswick, Managing Director, Webloyalty Northern Europe (@Webloyalty_Guy)