Retail organizations across the globe are using workforce analytics to drive actionable insight across their organizations.
Simply put, workforce analytics helps retailers transform sales and labour data into meaningful information so they can make fact-based decisions, at any time, to improve operational outcomes.
For example, many retailers say they do not have access to data on performance to targets until it’s too late to make any changes — often weeks later. With workforce analytics, retailers can access this information in real time so they can identify issues such as unplanned overtime, high absenteeism rates and low sales per labour hour.
They are also given guidance on the changes they need to make to their business to get back in line with expectations. Being able to manage in the moment is the key to not only staying on target but ensuring they remain nimble in a highly competitive marketplace.
“Organizations that integrate workforce management and business data by taking advantage of business intelligence or analytics tools are four times more likely to achieve best-in-class status as those that don’t,” according to the 2011 report Workforce Analytics: Key to Aligning People to Business Strategy from the Aberdeen Group, which surveyed 450 organizations.
So, where do you start?
Making data accessible and actionable
Using analytics to better manage a business doesn’t have to be complicated. Instead of getting bogged down with terabytes of data, think of it as a simple formula: Data plus analysis plus action equals gold.
Data: It all starts with data yet retailers find it difficult to access data from all parts of the organization. Adding to the challenge is the fact much of this data exists in disparate silos, such as financial data from ERP (enterprise resource planning) systems, operational information in point-of-sale systems, people data from HR solutions and customer traffic from people counters.
Worse, even if they can uncover all of this information, the effort to compile and make sense of the data is usually a time-consuming, manual effort that could take days or weeks.
With workforce analytics, these disparate silos of information are broken down into easy-to-read dashboards, giving stakeholders a clear picture of their business at any time.
This lets them focus on solving issues rather than spending valuable time manually pulling reports from various systems.
Analysis: In a big data world, data volume, velocity and variety are all increasing at exponential rates. So having the right people at your business who can understand what the operational data really means is vitally important.
Retailers using workforce analytics to improve business outcomes need people with a new profile of skills that includes:
• domain expertise — the analyst must understand retail
• analytical expertise — the analyst must understand statistics and data, and be able to separate signal from noise, causation from correlation, and have the ability to recognize patterns
• business expertise — elegant relationships are not much use unless they can be translated into sales growth, expense reduction or positive brand recognition
• storytelling expertise — many great analyses have died on the vine because the analyst could not tell a compelling story with the data, so data visualization is important here.
Action: This represents the idea that great analysis is meaningless if a retailer does nothing with the information. Workforce analytics empower retailers to make fact-based decisions based on company-specific key performance indicators (KPIs).
So not only are retailers given insight into actual and projected results — such as labour costs as a percentage of sales, sales per labour hour and overtime thresholds — they are also given guidance for recommended adjustments.
This empowers retailers to better understand what’s going on at their stores at any time and make data-driven decisions that keep results in line with expectations.
Take, for example, the customer experience. Customers are willing to pay 13 per cent more for a great experience, according to the 2012 American Express Global Customer Service Barometer. So, how do workforce analytics drive action and create a better in-store experience?
With the right data and analysis, stakeholders can easily manage in the moment and ensure labour costs are tightly aligned to sales volume to maximize opportunites to create a consistent customer experience that keeps customers loyal to the brand.
Gold: When you bring together data, analysis and action, you ultimately achieve gold because harnessing data, analyzing it effectively and taking action will ultimately drive continuous improvement across an organization.
Whether it is improved customer satisfaction, decreased turnover, increased basket size and conversion or reduced labour costs, the benefits of a successful workforce analytics strategy are key to a profitable business.
In a dog-eat-dog world, retailers need real-time insight and control to make mission-critical decisions in the moment, rather than after the fact. Workforce analytics make this possible.
By bringing together financial data, operational information, people data and traffic volume from disparate systems — and making sense of it — key stakeholders can take action and impact the bottom line. So while competitors continue to make decisions based on gut feelings, you don’t have to.
Liz Moughan is director of the retail and hospitality practice group at Kronos in Chelmsford, Mass. She can be reached at firstname.lastname@example.org or, for more information, visit www.kronos.ca.