05 Aug Interview: Inside retail diagnostics, with Scott Reid
RPS Interview: What happens during a Performance Diagnostic
Our approach to the Performance Diagnostic has changed over the years. When we say we set retailers up to win we apply current and recent knowledge of what’s happening in their industry and their sector. We have usually worked in their geographical region before, as our roster is larger than we advertise, and we also have an idea about the history of the area from the programmes we’ve run in the past. What’s not publicised so much, but is key to our offering, is our awareness of the interdependence within the retail community. Who the main players are, how they interact, who’s changed jobs at the top-levels and what this might mean for our clients and their place in their market.
A performance diagnostic is best understood as a performance blueprint which tells you exactly which areas you need to keep focused on including continuing to do what’s making you great right now. We then specifically identify areas which are stopping you from getting to that level of ‘great’ you already know you can hit. We highlight all those key points and you’re left with a document that, if you follow it, will take you to the next level.
How we take the first steps to understanding a company’s culture is mostly through observations, interviews and meetings with everyone from the senior team through to the store management, department management, area management and floor staff.
Mostly we’re looking at a couple of key things, like what is the discipline in the business? How disciplined are people to follow through initiatives and to get the basic stuff right? Then we’re looking at what’s the urgency in the business. When something needs to happen does it happen quickly or does it drag on, so that things don’t end up getting done? Really, they’re the two main areas we’re asking about to determine whether or not it’s a performance and commercial environment.
Once we’ve identified the issues, the second steps to a performance diagnostic is identifying the opportunities which lead to improving top line sales and profitability. We look at the spread in performance across people, space and ranging. With people, for example, we look at ‘what’s the spread between a top performing individual and one of the bottom performing individuals’ and how do you reduce that spread? That’s where there’s usually a huge performance opportunity for most businesses, because you’ll never reduce that spread to within 25% across the whole team, however for any individual percentage higher than that 25%, where that spread is greater, you’ll find that opportunity with that individual. We look at the spread in performance of people, the space (so the return on square footage), the performance of the ranging and the products that you’ve got within the store and look for the opportunities. How the store looks and whether they’ve got everything out can vary enormously, especially in department stores across diverse teams.
By far the most challenging thing for a retail consultant is being sensitive to a company’s needs as we determine how well-placed they are to implement any of our changes. This lends itself to our values at RPS in the sense everything we do is specific to that company; it is not a one size fits all solution.
We need to fully understand the company’s current situation, their environment and their culture and then we suggest things based specifically on that. We’re not going in to say to people go and completely overhaul and do a brand-new shop fit; or you need to invest loads of money to get this return. We say instead, ‘what can they do with their current resources?’. To get the best out of that, and look to increase the productivity of your people, increase the productivity of your space and ranging and what you’ve already got in the store. I guess that’s why it’s called a diagnostic. We’re not selling you a new liver.
Once a company has gone through the diagnostic, their experiences are positive. A lot of what we tell them is stuff they should be aware of, but it is given to them in a way they’ve never thought about before and it’s especially beneficial if they’ve never thought about how they can utilise their current resources to drive top line sales. If there are glaring opportunities for them to invest money into the business, we’d suggest that, of course, but none of it is based on the idea they need to spend this amount of money to get this amount of money back.
The retail industry is vital to UK industry and the largest private sector employer in the UK. Now is a perfect time for businesses to work with RPS and get a fresh pair of eyes across their estate. We passionately believe in setting people up to win.
An RPS Performance diagnostic benchmarks your retail business against competitors and industry standards, reviews your strategy initiatives and their likelihood of success in today’s market and provides an analysis of your people, productivity and performance. As a result of implementing our Performance Diagnostic recommendations, clients experience an immediate sales increase of between 3-8%.
The RPS performance system, based on Olympic sport performance principles, has delivered great results for retailers for over 35 years.