How to Manage Your Most Valuable Asset

Want your employees to grow with your business?

Train them carefully and treat them right!

by Patricia M. Johnson, CMC and Richard F. Outcalt, CMC

No matter how well you watch cash flow, manage inventory, or make your store attractive to customers, you will lose business if you don’t work to develop your employees.

In a high-service industry like specialty-store retail, contact between the salesperson and the customer can make or break the bond between your business and your customers. Many retail owners, however, fail to recognize how important that connection is.

In too many independent retail shops, training sessions consist of showing new employees how to punch the time clock, how to run the cash register, and where to take breaks. Once these skills have been mastered, employees are pretty much on their own.

But to be as effective as they can be, your employees need much more.

Doing a poor job of developing employees’ potential can generate a high turnover rate among employees, along with a general lack of motivation and bad customer relations.

Employees will be more interested in coffee breaks, texting their friends, and quitting time than in taking care of customers. As a result, they will produce far less than they would if they were highly motivated and trained.

Nurturing and maintaining strong front line salespeople and support staff is far better than dealing with constant employee turnover.

Here is a three part process we encourage you to apply to your retail operation. It starts with a thought-provoking quiz. Ready?

Step #1: How Are You Doing So Far? Take This Test

Here’s a short but thought-provoking quiz you can take to help uncover any hidden problems you might have within your employee relations.

Answer "Yes" or "No" as honestly as you can to each of these questions.

If all your answers are yes, you are doing a wonderful job.
However, if some come up negative, then you’ve found places where you can improve.

Employee Management Quiz

1. Do your employees know exactly what you expect of them?

Have you given them written job descriptions clearly explaining their responsibilities?
Do you routinely give them constructive criticism and encouragement?

2. Do you use at least one of the following employee-employer communication methods:

Regular, private individual conferences?
Informal on-the-job discussions?
A formal method of bringing suggestions to your attention?
Group meetings featuring open discussion of issues employees want to raise?

3. Do you recognize and reward outstanding performance?

4. Do you have an on-going training program including training on merchandise knowledge, design, selling techniques and customer relations?

5. Is your employee benefit program competitive?

Do your employees understand their benefits thoroughly in order to take maximum advantage of them?

6. Are your wages competitive?

7. Do you follow a formal system of pay raises?

Do your employees understand what they have to do to earn raises?

8. What about a formal system of promotion?

Do your employees understand the basis of earning a promotion?

9. Did any of your supervisors or managers start at entry-level jobs in your business?

10. Do you try to discover each of your employee’s strengths and allow each to contribute as much as possible from those strengths?

11. Are your stores (and your offices) bright and cheerful places to work?

12. Are your employees generally happy working in your business?

13. Do your employees know your long-range goals?

Do you tell them how their performance measures against those goals?

14. Do you have a formal program of sharing your business’ profits with your employees?

Step #2: What Are the Top Priorities for Employees?

How important to your employees are the factors that were probed in the quiz? (We thought you'd never ask.) Very important, according to nearly every study of employee attitudes we’ve seen.

Emotional and qualitative rewards frequently rank highest for contributing to employee satisfaction. Money is behind emotional rewards, but still near the top of the list.

Here is the way we would rank the Top 10 priorities for employees:

Expressed appreciation from employer for work well done.
Knowledge of what’s going on in the business and the owner’s goals for the business.
Management’s understanding of employee’s personal needs.
Job security.
Good wages and benefits.
Interesting, challenging work.
Opportunities for growth in responsibilities and compensation.
Management’s loyalty to employees.
Good working conditions.
Tactful discipline.

Now, look again at your answers to the quiz. Based on your candid assessment, how strong is your business in the things that matter to employees?

Step #3: Get Some Real Feedback

Now, we urge you to give the same quiz to your employees! Have them fill it out, and return it (without identifying themselves, of course.)

Often their perceptions will be markedly different from yours.

They might be concealing ill feelings and misunderstandings they are afraid to mention for fear of losing their jobs.

If there is a pattern in their answers that doesn't match yours, consider why.

Any dissatisfaction they feel, no matter how hard they try to hide it, will surface when they talk to customers. That is when it will hurt you most—at the point of sale.

Remember, this isn't a popularity contest. It instead is focused on making your stores be the best possible experience for the customers.

So put these findings to use. Make needed changes to increase effective communication.

But don't stop there. After implementing your improvements, give them the "accountability test." Check your sales and profit results in a few months to see whether the commitment has been worth the effort.

Our prediction?

You will find sizable rewards for your efforts—not only in your staff's morale, but in your sales and profit figures as well.

And your customers will be the most pleased of all!

Since 1999, empowering retailers and store owners to "Turn on your financial headlights!"