Sunday, June 10, 2012

The Failure of Buisness Majors: Part 2

Having already discussed the way that modern retail is run, let us today begin discussing why it fails. The biggest and most obvious problem with the Walton model is the lack of sales floor coverage. Everyone has had the experience of being in a store and being unable to find what you need. You look around for an associate to ask for help, and there is no one there. Finally, you find a person at a register but they cannot help you because they can't leave the register unattended. You feel frustrated and upset. And rightly so. You are the customer, you are the reason that the store exists, and you are not getting what you need. You either leave the store frustrated or spend extra time out of your schedule trying to find what you are looking for. Either way you are unhappy. This could have been avoided very simply by having one associate at the register and another on the floor assisting customers. But more and more often this is not so. Those who work in retail will know the reason why, but I will explain for those  who don't. According to the Walton view, employees are an expense. To make a profit you must minimize your expense. So the store is allowed a certain number of hours to allot to employees, the number of which are tied to the projected sales of the store. The manager is also expected to adjust the number of hours s/he uses depending on whether  or not the store is meeting those sales predictions.  When a store has a slow Monday or Wednesday, they have to cut hours on Friday and Saturday. The problem with that is more people shop on the weekends. There needs to be more sales associates and most of the time there aren't. Because there are fewer associates on the floor, the work load is also increased.  It becomes a vicious cycle. Low sales means fewer associates, which means customers suffer and sales suffer, which means even fewer associates.
Something needs to be done to break the cycle. Retailers need to remember that their employees aren't an expense but an asset. Just like the military...

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