Client

Specialty shoe, apparel and accessory retailer with over 1100 retail stores and $1.1 Billion in annual sales.

Problem

The organization needed to significantly reduce labor cost while increasing throughput in the order fulfillment, replenishment and receiving operations to meet peak production goals.

Approach

To transform the company culture, we used a blend of process redesign, multi-variable performance goals, management training, associate coaching, and new decision support tools as foundation for an analytically based pay-for-performance program. Once the procedures were streamlined, the team developed, statistically validated, and installed engineered performance goals. Most importantly, the supervisors were given a new set of tools to coach associates to high performance. Key success factors:

• Established new performance reporting tools and coaching guides
• Implemented lasting improvements in operational workflow, layout, and procedures
• Changed manager and supervisor focus and behavior to proactive staff planning, associate coaching, and performance management
• Developed a performance-driven, self-directed work-force through relevant incentives and objective benchmarking

Results

Productivity soared more than 60 percent. Employees were rewarded for their efforts with 15 percent bonus earnings for achieving 100% performance. Many earned more. Supervisors were rewarded for achieving performance goals of productivity, quality, staffing efficiency, and coaching / feedback effectiveness. The culture shifted to prioritize:

• Coaching and performance feedback as a regular, objective event
• Weekly and daily staff planning
• Public recognition of associates with high levels of performance and improvement

The company realized both financial and cultural benefits, including:

• Reduced labor costs through increased productivity
• Eliminated the entire second shift order filling operations due to increased efficiency
• Improved quality and service performance during peak and off-peak times
• Reduced dependence on temporary associates due to increased morale and retention of quality associates
• Clearly defined and objective performance expectations
• Recognition awards based on objective criteria valued by associates
• Daily, personal feedback on performance relative to goals
• Precise staff scheduling capabilities via integrated modeling tools