Thursday, 19 February 2015

Make decisions based on long-term trends rather than one-off incidents

I've been working with a few retailers recently and we've been looking at the long-term trends in their business. This is getting a fix on what us happening on an average day or event rather than looking at one instance and making a knee-jerk decision.

For example, one retailer has a fortnightly run when they change their promotions over. It keeps their offering looking fresh and keeps customer interest levels high. On the first such changeover of the new year, there were a few changes to how things are done and this meant that the team delivering this were completed early. The retailer wanted to immediately cut the hours allocated to this task and make a cost saving. However, my instinct was to wait and assess how this change went over proceeding weeks, to ensure that the time saving was ongoing, rather than just a one-off event. As it happened, there was a cost saving, but only at about half the level that was expected after the first incidence.

My point is, that by making a decision after the first event, you aren't getting the full picture and may have to make the decision more than once.

Every change to your business will necessitate at the very least, a thought process that looks at whether this changes affects other parts of the business. A new product may need staff training, a change in opening hours will need staff consultations for a change in their hours. And so on.

The next step is how to evaluate the change and how you will make changes, and this is mainly done with evidence. See how the new product is projected to increase sales and how much extra/different knowledge each team member needs to be able to sell it. From there, you have a training budget and can measure this against expected sales. Ensure that it is cost-effective.

As in the example I cited above, an analysis if the changes over several weeks and plotting the amount of time saves on each changeover will give you an average number of hours saved per fortnight and then either a reallocation of hours elsewhere in the business, or a staff consultation to see where hours can be saved. In our case, there was a vacancy that came up somewhere else in the store and someone volunteered to change roles and more over there.

Communication is the key, and being able to discuss these matters openly and honestly with your team will ensure a smooth transition in the event of any change.

How to sell your home: What estate agents don't tell you by Steven Thompson

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