Raleigh & Rosse: Measures to motivate Exceptional Service

By Group 9:

R&R DASHBOARD
Specialty retailer of luxury goods 38 retail locations with average revenue per square foot of 1200$ significantly higher than industry average of 675$ Extraordinary customer service, deep customer loyalty Strategy: Own your business, own your customer relationship

R&R ownership culture & SPH Program

The following are the policy changes

Shifting focus from experienced sales professionals to college graduates and training them Maintaining internal promotions system thereby improving the experience level of mid mgmt. team Revamped sales associates commission system Investment in IT Greater autonomy to sales managers Measurement of sales associates by weekly sales Sales managers were measured by standard metrics like revenues, gross margin etc.

Sales per Hour Program

PROBLEM STATEMENT
Introduction of SPH led to
More intense work environment Sharking

Off the clock work hours

Problem Analysis
Managers tend to manipulate the system to improve SPH Mandatory Saturday morning meetings were not allowed to be included in the work hours Vague distinctions between Selling time" and NonSelling hours Flaws in Performance Management program

Five Building Blocks of Effective Incentive Plans

Using an incentive plan does not make sense as : 1. Motivation is not a problem as the employees are already known for their extraordinary customer service. The job is not standardized and work flow is not regular. 2. A sales person performs a number of miscellaneous tasks for customers and takes part in non-sales activities. Floor sales are not continuous or consistent.

The incentive program (SPH) does not align with their strategy: 1. The strategy for the company is to promote accountability and entrepreneurship. 2. SPH does not pay employees for non-sale hours spent on client relationships and hence employees and also encourages the employees to report lesser number of hours to get higher incentives

The program is not completely motivational :No clear relationship between effort and reward

Complete standards are not set : The incentives are based only on value of sales made. No qualitative aspects of performance are measured and rewarded

It has not been scientifically analyzed whether SPH increases performance

Recommendation
Watkins should settle the lawsuit outside the court by paying its associates and bringing about changes in the Ownership culture and SPH. Make modifications to SPH and re-implement. Draw clear lines between work hours and non-work hours and ensure that only work hours are counted for SPH rates. Non-work hours to be documented and recompensed at a standard rate, thus giving employees the necessary motivation. Incentives not just for numbers but also for relationships created and maintained. Implement an annual bonus plan for store managers. This should incorporate not just ratings for achieving personal goals but should also depend on associates performances. This ensures that hard-work is not forgotten and will offer a bigger pay-out with continued efforts. Making store managers more accountable for sales associates through balanced scorecards.

Thanks