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Undercover with the Boss

If you haven’t seen the new CBS TV show Undercover Boss, it’s worth checking out.  Perhaps not so much for the cheesy endings (at least on the first two episodes) where outcomes are achieved for individual employees that rival Queen for a Day in terms of bathos.  What is “new” here, though, is our ability to look over the shoulder of CEO’s from brand name companies while they experience first hand how hard their employees work to deliver a good outcome for their customers, often in spite of organizational obstacles imposed in the interest of greater efficiency.

I put “new” in quotes because the concept of understanding your front line employees as a means of understanding how to improve your business goes back to management research that Joseph Juran was pioneering in the 1950’s.  When I was teaching total quality management seminars in the 1980’s, we were preaching the value of understanding the moments of truth where your employees either delight or disappoint your customers.  What’s therefore so interesting about this show to me is what a revolutionary concept this field level view of the world has become for many organizations.

In the first episode, pictured above, Larry O’Donnell, President and COO of Waste Management experiences not only how difficult and dirty some of these waste disposal jobs are, but also how well meaning policies set at a corporate level can wreak havoc at the employee level.  He seems genuinely surprised to see that truck drivers have no bathroom breaks built into their routes or that cleaning 15 portable toilets an hour is a superhuman effort.  He appears equally surprised at the level of grace and humour that many of his brand ambassadors bring to their very tough jobs.  Larry takes action to address these issues when he goes back to his day job that hopefully will make the work environment more friendly for his employees.

How great could your organization be if senior leadership could experience life in the trenches?

P.S.  In the second episode, the CEO of Hooters seems perplexed that potential customers find the Hooters brand demeaning to women.  REALLY?

February Retail Labor Index

The February release of the Kronos Retail Labor Index shows that in January 2010, retail applicants came back into the market in force, with a 20% increase in applications over December 2009.  We had observed a seasonally adjusted decline in applications at the end of 2009, possibly due to workers becoming discouraged by their holiday employment prospects.

Hiring for January was also down, but by a smaller 4.26%.  The good news is that although hiring was down compared to one month ago, it was up over one year ago, by 12%.  The combination of greatly increased application volumes, combined with a reduction in hiring, led to a decline in the Index of 20.41%, to 3.20% (for every 100 applications received, 3.2 hires occurred on average).

In this month’s report we also introduce a new model of the consumer economy.  Through this model we will use data to observe how three major markets interact:  (1) the market for goods & services; (2) the financial markets which supply credit to consumers; and (3) the labor market which, through employment, enables spending, saving, and investing by consumers.  We will introduce the different components of the model in upcoming reports in 2010.

The conceptual model introduced in the current report demonstrates how consumers’ motivation to increase their liquidity by decreasing their debt (negative liquidity), including exactly the kinds of revolving credit that retailers extend to stimulate purchases, correlates to the Index.  According to the report, a  “choke point” can be seen in late 2008, where at its peak the ratio of consumer liability to disposable income had  reached 138% in the U.S. Since that point, consumers have reduced the amount of revolving credit for the first time  since World War II. This has a direct negative impact on retail spending and thereby retail hiring.

What’s your attitude toward retail spending these days?  Many retailers seem to be offering non-stop sales and promotions to loosen your wallet.  Are you biting?