Somerfield
Somerfield increases positive customer feedback and reduces absence with Kronos
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In 2006, no longer content with following the market and reacting to the strategies of other retailers, Somerfield's mission became 'to be Britain's favourite local grocery shop.' Adrian Peace, Head of Simplification and Productivity comments: "In order to support this goal we needed a radical re-think about the priorities for the business. Cost
control, improvements in productivity and an increase in customer service levels could not be mutually exclusive goals. It was obvious to us that to improve customer service and availability of product, we needed to ensure that colleagues were scheduled to work at times to suit our customers. With this in mind, we set out to find a workforce management solution from a vendor who understood and shared our vision."
Somerfield had a number of business challenges it was keen to address as part of this project. Absence was thought to be too high, though without automated, accurate and real time data-collection across all stores, it was impossible to know exactly how high. Customer service levels were being measured by the number of complaints rather than by accurately monitoring customer feedback. Fixed hours contracts for employees created an inflexible working pattern that led to a misalignment of colleague working hours to customer demand and the desire to have a multi-skilled workforce was difficult to monitor using paper-based systems.
Finding a solution partner
Somerfield found that selecting the right solution partner had just as much to do with the people in the supplier organisation as it had to do with the technology. Adrian Peace explains: "We followed a thorough vendor evaluation process and selected Kronos for a number of reasons. The company has excellent domain expertise and a reputation for successful workforce management projects within retail. Kronos understands our business and our goals and demonstrated a disciplined approach to rolling out a "best practice" system."
Starting the project
Following consultation sessions with Kronos,Somerfield realised that its higher than average absence levels would seriously affect the effectiveness of any optimised schedules the system produced. The optimised schedules would only be beneficial if the absence rate was addressed first. The route to higher attendance was to first roll out the absence management capabilities of Kronos for Retail to every store to accurately monitor and measure staff attendance, and then roll out forecasting, workload planning and optimised scheduling.
Having selected Kronos in March 2006, the implementation of Kronos for Retail started in October 2006 when Kronos Workforce Timekeeper™, was rolled out to all stores over a three week period. Three hours training was all that was required for the manager at each store and within three weeks, Somerfield achieved 99% compliance with very few colleagues failing to record their time. Adrian Peace says: "It was an amazing achievement to
roll out the first phase of the project within such an aggressive timescale and testament to the ease of use of the system, and the professionalism and teamwork displayed by both the in-house team and Kronos."
Once the roll-out of the forecasting and optimised scheduling system started in July 2007, stores followed a 12-week implementation plan, during which time test schedules were run by Kronos to check if stores had the required levels of multi-skilling and working hours flexibility to work to the optimised schedules created by the system.
Significant benefits
Attendance information is now monitored in real-time, with store managers receiving alerts when colleagues fail to turn up, and immediate notification when a member of staff returns to work following a period of absence. This increased scrutiny on attendance and the ability for managers to immediately address absence issues has reduced overall absence levels by 40%, from 6.88% to 4% - the equivalent of having an additional employee in every store every day.
Somerfield also noticed a dramatic decrease in the salary bill for premium overtime payments once phase one of the project was complete. Adrian Peace explains: "With Kronos now holding all employee information including hours worked, availability for work and skills, we have complete visibility to the workforce. We rely less on overtime now that absence levels have reduced and can identify when working additional hours will take a colleague into premium overtime payments. Our premium overtime bill has decreased by £2.3 million per annum and we expect to see further savings following phase two of the project."
The success of an optimised scheduling system depends very much on the availability of multi-skilled employees – employees who can be scheduled to work in a number of different store areas during one shift. Prior to the project, Somerfield had a KPI to have 35% of the workforce multi- skilled, but with manual systems to record this information, it was impossible to know the true figure. With the first phase of the project complete and all colleagues’ skills recorded centrally, Somerfield could see that approximately 10% of colleagues were multi-skilled – far too low a number to maximise the benefits of optimised scheduling. Somerfield set about re-training colleagues, and today over 65% of employees are multi-skilled and all stores are now able to comply with the optimised schedules created by Kronos.
Customer satisfaction has always been of paramount importance to Somerfield and the first customer satisfaction poll after phase one of the project showed a 20% increase in customers agreeing that Somerfield is improving. "Lower absence levels and employee schedules matching store trading patterns mean more colleagues in stores to keep stock on the shelves and serve the customer. We’re delighted that customers have noticed the improvements," says Peace.
Future plans
Implementation is now underway of Kronos Workforce Operations Planner™ – a central budgeting module which will allow Somerfield to create annual bottom up labour budgets based on labour standards and sophisticated forecasting algorithms. For the first time, annual budgeted labour requirements will be accurately based around sales forecasts.
"Kronos for Retail is more than just a system," concluded Peace. "It's enabled a cultural shift within the organisation, where colleagues are recognised and rewarded as assets, customers are central to everything we do and better service, improved productivity and cost control are no longer mutually exclusive goals."