By Bill Scott, President, StoreReport LLC
Recently, someone posted an article on ‘Leadership’ in our LinkedIn forum, ‘Convenience Store Supply Chain Management.’ David Marcotte posted an excellent response. Last night, as I was trying to get to sleep, the thought kept running through my head that leadership is a result, more so than it is an action. David’s words echoed in my mind, ‘establishing confidence at each rising level of responsibility’.
In Google search, a quarter of a billion hits come up on the subject of ‘leadership’. I think it’s because it’s easier to write about ‘leadership’ than it is to actually perform the act. Leadership is a popular ‘do as I say, not as I do’ type of subject, and something most of us in management take for granted. Mention leadership to any manager and they will consider themselves good at it. But, get them to define how leadership is attained, and their confidence level drops significantly.
In my own response to the article, I cited my experiences in basic training after I enlisted in the military. Those of us who have been there and done that understand that facet of it quite well. Those of us that have never encountered such an experience may see it differently, but the truth is, leadership in the military is more of an environment for determining who is capable of leading as it is in the act itself.
In the convenience store industry, I marvel at the glaring lack of leadership in that particular segment and it is evidenced in the chump-change that each convenience store adds to a company’s bottom line. A paltry 2.1% net profit is unacceptable in my way of thinking. But, it’s not just the convenience store industry that is affected. I see it time and time again in almost every retail store throughout America; and if retail is going to survive, it’s long past the time when something should be done about it.
It all starts with the mind set of management. When I say, “we need to reinvent retail” I mean we must start with the CEO of a company and take it all the way down to the lowest common denominator, including the hiring process involved in the interviewing of new employees.
In a world where computers have virtually shrunk time, we have come to a point where our actions toward our business practices have caused us to overlook the details and concentrate only on the results, and we have been doing that for so long, we have completely forgotten about how the process actually should work.
The trouble starts with the acceptance of assumptions from the CEO. In an environment where nothing is engraved in stone, CEOs and store owners tend to operate on beliefs that are constantly being invalidated by the reality of what is actually happening in our businesses. They look at the numbers and make wide-sweeping changes that often have negative effects from the top down.
The Hiring of Employees
Most companies relegate the responsibility of the hiring of new employees to convenience store managers who have no training whatsoever in Human Resources. They are often encouraged to overlook imperfections in potential new hires to acquire more bodies into the stores.
The Lack of Training
Employees receive little or no training and their performance on the job is rated primarily by the observations of other untrained employees who rate new hires based upon whether they ‘fit in’ with the culture that exists in the stores, rather than on the value they contribute to the team.
Emphasis On Increasing Store Traffic
Promotions and store policies are aimed at increasing the amount of traffic into the stores, with little or no emphasis being given to the quality of the traffic received. Almost half of a store’s transactions are non-profitable, and no attempt is being made to identify profitable transactions over non-profitable ones; yet, we continue to rate performance on the number of footprints rather than on the profitability these customers add to the till.
Mud On the Wall
Promotions and sales are almost always at the requests of suppliers whose only interests are in moving more products out of their warehouses. With suppliers having no credible knowledge of each stores’ unique environment, the majority of promotions are experiments at the expense of the retailers, with cannibalization being the primary reason for losses incurred is almost every attempt. Effective promotions are usually stopped too soon, and damaging promotions are not stopped soon enough.
The Absence of Teamwork
Store employees rarely work as a team. They don’t know what teamwork is. Most of them are clock watchers who are left to manage themselves with no purpose other than collecting a check for substandard work. There is no career path offered other than rising to the level of store manager that comes with a hurricane of paperwork, unexpected responsibilities inherited and a slight increase in pay.
Leadership Implies There Is a Team to Lead
All the leadership in the world is worthless without a team in place that is capable of being led. New employees should never be hired at the time of their first interview. Holding to the requirement of a follow-up interview allows time for the person doing the hiring to consider the qualifications of a potential employee. It gives the applicant a chance to think about whether they want to be part of the team or not. It instills in them a desire for acceptance, and being called back for a second interview makes the potential new hire feel they have accomplished something important in their lives.
Accepted applicants should go through a probationary training process of at least two weeks. This gives the manager time to evaluate a potential employee before being asked to formerly join the team. It gives the employee time to determine if this is a job they want to keep. And at the point of acceptance, it makes the trainee feel like he or she has passed a milestone, and being formerly accepted into the team comes with a certain sense of accomplishment.
David Marcotte’s statement, “establishing confidence at each rising level of responsibility,” came to mind as I considered the process of creating a career instead of merely a job. Confidence makes responsibility possible, and responsibility must be earned, not given, because responsibility earned improves character, whereas responsibility given may not.
As it is, there is no future in working in a small retail store because there is no written down path for advancement. You can be a clerk or an owner/manager, that’s the extent of it, and neither position offers a career path that points to a glorious future. That comes with its own challenges. But, in a store where there are eight or more employees, you can do something about that.
The key is to work on an organizational structure inside the store. When an employee reaches a certain level, they can be sent outside for training, or you can subscribe to online courses on CRM, inventory management, health and safety, how to handle certain emergencies, etc. Local law enforcement agencies may offer free classes in how to handle shoplifters, the congregation of gangs outside the store, unruly customers, even instructions on how to react in the event of a robbery.
As David Marcotte said, “establish confidence at each rising level of responsibility.” It doesn’t take a lot of money and time to make a huge difference in your employee’s lives. Make them part of a team and as a result, leadership will follow.