When it comes to the retail sector, workforce management is complex, complicated and arduous due to the multifaceted nature of its teams. There are full-time workers, part-time and contractual workers employed across different distribution channels. To judge their performance can be a daunting task as there are so many parameters to consider.
Customer expectations have also changed during the current COVID-19 crisis with an accelerated demand for contactless service, even in the brick-and-mortar stores. Hence, there is a pressing need for retailers to invest in technology to empower them to determine which business strategies will work, skills and technologies that will lead to future growth, manage and train the workforce to prepare them for future challenges. It is here that peoples analytics come into play.
What is people analytics?
Also known as data-driven talent analysis or data-driven human resource, people analytics is the practice of deriving and analysing personnel data to get actionable insights about the employees. These insights then help a company to utilise their personnel in the best possible manner to achieve maximum results. It also helps in streamlining their onboarding process, hire and retain efficient employees and maximise productivity by making optimal use of their resources.
How people analytics works in retail management?
Did you know that retail is one of the most dynamic business sectors that face maximum changes and challenges as compared to other industries? Be it the uncertain economy, increasing competition, keeping up with the latest product launches and technological trends, or demanding customers, the retail sector has to constantly evolve to survive and thrive in this fluctuating environment.
Hence, retail companies should make use of data to improve their performance and keep up with the changing times. As per an analysis conducted by Deloitte, a retailer requires an in-depth analysis to predict and manage future performances. It can also help answer enterprise-level questions like which customers can we lose? Which suppliers can go out of business? Which high-performing employees can we lose? Will demographic shift have an impact on our market share?
People analytics is also imperative at a time when retailers are expanding to multiple channels, communicating with customers directly via social media channels and increasingly using digital marketing. There is a huge amount of data that can be put to better use to drive profit.
Let us examine the ways in which people analytics solves retail’s workforce issues-:
1) Recruit the right talent : Recruiting the perfect candidate for a job can give nightmares to even the most experienced HR managers. It becomes even more crucial for the retail industry, where recruits are directly related to customer satisfaction and retention. Hiring wrong candidates can not only lead to business losses, but also can put a dent in the company’s reputation. People analytics can help retailers to look beyond just time-to-fill and cost-to-hire numbers. By analysing the skills and attributes of a candidate, it can help you to determine if the candidate is suitable for that role and a fit for your company. It also helps in driving business profitability by placing the right resource at the right place, ensuring that a resource is not being underutilised or even to meet a sudden demand. By tackling such challenges, people analytics make use of data to link employee’s performance with profitability.
2) Get maximum value from the current employees : As per a study conducted by McKinsey, nearly 9 out of 10 executives and managers said that their organisations are either facing skill gaps already or anticipate gaps to develop in the next few years. People analytics can help in re-skilling by training, and also help in retaining the best candidates by offering a performance-related bonus and investing in their capability development. Though re-skilling can be expensive, it pays off in the long run as it ensures employees are well-trained, to be in sync with the technological changes that will define the future shopping experience.
3) Enhance employee experience in the workplace : Each company has its unique culture that gives a sense of identity and purpose to employees. Retailers can take the aid of analytics to determine if the employees are satisfied working for their company and if there are areas where there is a scope of improvement for the company. This will increase employee satisfaction, which will in turn, give a boost to productivity.
4) Manage your workforce cost : Having an efficient people analytics gives you an accurate headcount and the value of your retail workforce to provide you with insights on how to track and reduce costs effectively without having any impact on the operations. You can also derive insights into factors that can lead to overtime, absence and high turnover.
5) Retain the best talent : Due to intense competition, there is immense pressure on retailers to retain their best employees. However, with a mix of full-time, part-time, contractual and seasonal employees, determining one set of retention strategy that fit all becomes impossible. Using people analytics can help you determine what factors can drive employee attrition and what is likely to retain them.
6) Answering questions : As we have seen that one of the most significant advantages of using data and analytics in the retail sector is people management. What is interesting to note is that several big players are using it to predict future technologies and the skills required to complement it. People analytics help retailers in finding answers to questions like the impact of automation, labour shortage and evolution of consumer preferences on the business, what capabilities do their current employees possess and what other skills are required to ramp up growth.
Credit Suisse used people analytics to predict which employees might quit and why. The Wall Street Journal was so impressed by their algorithm that the daily wrote an article on it in 2015. Similarly, when Kraft Heinz launched a bid to takeover Unilever in 2017, it’s used analytics during the crisis to come up with cost reduction models and track employees’ reactions to it.
Hence, by using people analytics, retailers can forecast any future needs regarding personnel and prepare for future challenges.
Now that we have talked about what is people analytics and how it helps retailers in managing their personnel, let us examine a hypothetical example to understand it. 21-year-old Nora is looking for a part-time job in a local retail outlet to support her education. She registers herself on the various apps, lists her qualification and skills, and applies for a few jobs. Once her profile is shortlisted, she goes on to select a slot for her interview and impresses the interviewer via Skype. Her performance is marked on several parameters, and data is saved in the app for the company to work on future candidates. Once hired, Nora has to upload her documents and degrees in the app and also a few references. As soon as she starts working, the app not only measures her performance on different parameters like sales made, interaction with customers, punctuality, attendance, etc., but it also informs her when a new customer is walking in or with updates about loyal customers. Such information helps her to improve her skills, learn a new technology and get ahead in her career. Even for the company, the app helps to measure Nora’s performance to determine if the company should hire candidates with skills equivalent to hers. Also, her understanding and skill-sets help the company to determine if she needs further training and what kind of bonus does she deserve.
Now, that we have explored how people analytics can help both retailers and employees, it is advisable to invest in it.
Intellect Commerce also offers great people analytic solutions for retailers to prepare them for the future and invest in technologies that will make an impact on customer experience, employee performance, and overall retail industry. For more information, request for a free demo of iRetail Suite that will help you to manage your personnel efficiently.
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