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Strategy + Business

From Shop Attendant to CEO: why training is essential in retail

Andrew Gorecki

April 14, 2015

My karate Sensei used to say that practice does not necessarily make perfect. Only good practice makes perfect.

This still resonates with me as it aligns with a Total Quality Management focus on knowledge, rather than experience, as the key factor in making employees and management more effective within a business.

According to the Australian Workforce and Productivity Agency, the vast majority of people working in retail belong to the young generation. They tend to be clustered in sales roles whilst older workers tend to be found in management roles, reflecting natural career progression. Yet, some of the young people have serious ambition to progress within the retail industry and do it faster than just by growing older. Unfortunately, in Australia most have to learn on the job rather than through knowledge-based processes.

The Australian Workforce and Productivity Agency says only 37 per cent of retail workers have a post-school qualification compared to an all-industry figure of 60 per cent. This might partially reflect the age profile of the industry as many of the younger people still continue at school or pursue their first post-school qualification in parallel with their retail jobs. It also seems to reflect the fact that many employers in retail dismiss qualifications as irrelevant and recruit on the basis of personal attributes and previous experience.

The later tendency creates a self-perpetuating high staff turnover environment. Combined with the lack of long term focus from the employees and from the employers, it creates a truly casual employment relationship. Yet, the retailers would love to increase their staff retention, and many of the employees would stay in retail if real career opportunities were given to them.

To achieve longer term engagements, someone needs to break the vicious circle and it has to be the employers. They need to recognise that staff development can be crucial for staff retention, but as my Sensei said: it will have to be the right kind of staff development. It has to be structured and knowledge-based rather than mere on-the-job training where the employees learn to do their jobs from their managers.

Companies such as UPS, or United Parcel Service, have a policy that gives employees a shot at upward mobility within the firm. It’s a policy that came to the attention of the Harvard Business Review which noted that more than three quarters of UPS’ 44,000 managers and most of its vice presidents began their careers loading or driving trucks. A solid career path creates a good incentive to stay, but a multi-pronged approach must be put in place.

For example, a 2010 McKinsey study found that money alone won’t do the trick. Good personal management from business leaders, promotion opportunities, and most importantly chances to join fast-track management programs must operate in unison to increase retention. Formal training and structured personal development must be a core part of the package.

Employers in two minds about setting up a structured development program need to reconsider their approach to ROI, or return on investment from staff development. Organisations which cannot perform such calculations over periods longer than 12 months have a problem. Knowledge-based programs require years to produce results, but the results can be awesome. They get reflected in improved customer satisfaction, improved store productivity and ultimately become visible through increases in the bottom line.

The Australian Workforce and Productivity Agency commented that without a change things will get worse, as the demands on the skill levels in retail will grow:

“As retail environments introduce greater levels of technology, there is an expectation that sales staff will have a deeper level of product knowledge, as well as advanced problem-solving skills and digital literacy. There is also a growing need for staff to have data analysis skills to understand and respond to the preferences of individual customers, and to have the specialist skills required to access, design and implement new technology solutions.

“Sales staff will also need more sophisticated interpersonal skills and the capacity to provide a unique and compelling experience for customers.”

Where should you start?

Two pillars of sound management practice were created in 1980s, and I suggest that any retailer who seriously wants to boost their business incorporate them in their structured training programs: TQM (or Total Quality Management) and Requisite Organisation approach to personnel management. Obviously, those in charge must master these concepts first and assistance from TQM / RO specialists will most likely be required.

Any real (rather than trifling) change within an organisation requires marshalling the management through stages: first study to understand the new approach, leading to the adoption of new vocabulary and consequently a new way of thinking. Then better decisions and actions will follow.

In parallel, training programs should be designed for the team, kicking in when the company takes people on board as they join the organisation. They must be trained in particular tasks and roles, but equally importantly they must be educated in the true meaning of corporate values. Once a new employee finds his or her way around and starts functioning well in their role, career-oriented development can start, through formal personal and business skills development programs.

In this process staff will also experience growing empowerment to continually look for ways to improve business processes and let management know all about it, without fear. Staff will feel encouraged to challenge the old ways of doing things and propose new solutions. That makes more sense in the retail industry than anywhere else: front line employees have the direct contact with customers.

So, if you want great results from people in your business, start now to engage them with the medium to long term in mind – short fixes in the personnel space do not work. Don’t be too concerned about the time this will take. The future will arrive sooner than you think.

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About the author

Whether it is retail, technology, current events or entrepreneurship – Andrew Gorecki brings an unconventional approach to the subject matter. He provides a compelling alternative narrative, challenging mainstream views, and is sought out by industry insiders for his strategic advice and insights. Andrew co-founded the retail software company Retail Directions in 1994, and was a non-executive director of Reece Ltd and its subsidiary companies between 2008 and 2017. His latest book, Gearing Up for Success covers the critically important secrets of success that our schools choose not to teach.

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