Way back in 1969, Wickham Skinner had written an article in the Harvard Business Review saying that if designed, manufacturing can be a potent strategic weapon for firms. The key was in making manufacturing decisions, or in other words operations decisions, a part of corporate strategy making. Almost 45 years after the article was written, I was sad to see that a firm like Shoppers Stop had completely ignored basic operations principles in ground level operations. So, while operations parameters surely do not seem to be a part of strategy, they are not even a part of routine operations.
July 2nd, 2014 was the first day of supposedly a special sale for their First Citizen members of Shoppers Stop. Obviously they must have expected a higher number of customers as the sale proposition mentioned in the advertising was fabulous. As expected, the customers were surely higher and the number increased towards the evening. There were no major problems in the store, the culprit were the checkout counters.
When the number of customers are expected to be higher, the checkout, which would usually be the constraint, should have been designed to be as fast as possible. The number of customers would be more, and the number of SKUs per customer would also he higher. This one single factor could be a huge factor in realising the sale, as with larger queues, customers could just walk off.
And this was precisely what was happening. It was not a hoard of customers walking off, but a few surely were. The checkout time at around 5:30 pm was more than 25 minutes and it was getting worse. There were loud, irritating discussions in the queue about this.
The long checkout time had many reasons:
My point is that none of these reasons are radically new. Shoppers Stop has been in this business for around 20 years now. They should have seen through this. Designing for quick check outs is no rocket science. For some reason however businesses routinely ignore the operational issues that arise out of some marketing actions and do not take adequate actions to manage performance. I could hear a lot of talk among sales people in the Shoppers Stop store about their huge targets during the sale period. There was no talk about the queue at the check out counters. Yes, the counter staff were very courteous and patient, almost all the counters were open, but the clear lack of attention to the customer flow through was clear. Come on Shoppers Stop, you can surely do better!!
July 2nd, 2014 was the first day of supposedly a special sale for their First Citizen members of Shoppers Stop. Obviously they must have expected a higher number of customers as the sale proposition mentioned in the advertising was fabulous. As expected, the customers were surely higher and the number increased towards the evening. There were no major problems in the store, the culprit were the checkout counters.
When the number of customers are expected to be higher, the checkout, which would usually be the constraint, should have been designed to be as fast as possible. The number of customers would be more, and the number of SKUs per customer would also he higher. This one single factor could be a huge factor in realising the sale, as with larger queues, customers could just walk off.
And this was precisely what was happening. It was not a hoard of customers walking off, but a few surely were. The checkout time at around 5:30 pm was more than 25 minutes and it was getting worse. There were loud, irritating discussions in the queue about this.
The long checkout time had many reasons:
- The discounts were being manually entered. The problem was not just the entry, but since it was manual, the customers had lots of queries. Many were checking the calculations with the counter staff to confirm the discount amount. It is normal for customers to trust manual calculations lesser than automated ones.
- There was a confusion with the fine print of discounts. There was a 5% additional discount for something and as per the new policy the discount would not be given as cash, but would be added as points. Customers were inquiring about the timing of this policy change, the reason and lots of other things that were in no way helping increase the speed of checkout.
- Because the discounts were not cash (but points) a few customers were spending a lot of time at the counter debating if it was worth buying the material. Thus they were using up valuable time at the bottleneck process.
- The concept of cash back on credit cards is clear. But, many customers did not know about this and again had loads of queries.
- A few items had the bar codes missing. Though this was rare, even one item with a missing bar code could take up around 5 - 10 minutes to locate and clear.
- The invoice was another classic document. Though it was correct, it was cryptic. You needed a good head in mathematics to match the discounts mentioned to the actual value. Customers would obviously ask questions on this.
My point is that none of these reasons are radically new. Shoppers Stop has been in this business for around 20 years now. They should have seen through this. Designing for quick check outs is no rocket science. For some reason however businesses routinely ignore the operational issues that arise out of some marketing actions and do not take adequate actions to manage performance. I could hear a lot of talk among sales people in the Shoppers Stop store about their huge targets during the sale period. There was no talk about the queue at the check out counters. Yes, the counter staff were very courteous and patient, almost all the counters were open, but the clear lack of attention to the customer flow through was clear. Come on Shoppers Stop, you can surely do better!!
