The Big Miss: The Critical Success Element Most Retailers and Industry Analysts Are Overlooking When Talking about Surviving and Thriving in the Age of Retail Disruption
The term Retail Apocalypse has become so popular that it now has its own Wikipedia page. News websites such as The Atlantic, Retail Dive and Business Insider are sharing statistics and analysis around the demise of brick-and-mortar retail, along with analysis of what the future might hold. Conversely, Lori Mitchell-Keller from SAP and Greg Zakowicz from Oracle + Bronto describe the current turbulence as ranging from simply false to looking at the current trends as characteristic of a Retail Renaissance period. In this new Renaissance period, successful retailers will use new tools and technology to adapt and thrive while others — many of whom are already on the ropes — will join the rapidly growing and very long list of defunct U.S. retailers.
Yet, what most of the analysis and survival recommendations are missing lies at the heart of the original European Renaissance: Humanism. Few retailers or analysts see how critical humans are to the retail equation, and a few others still see humans only as a cost percentage of sales. It’s time for the retail industry to wake up and realize that perhaps their greatest strategic asset — their employees — are changing why they work, how they work and WHERE they work.
We know that the global workforce is undergoing a tremendous shift as the population ages and migrates, but even more importantly, the preferences of the global workforce have changed. Rainer Strack’s popular TED Talk on the workforce crisis of 2030 shows how much job seekers’ preferences are changing. An attractive fixed salary was once the default preference, but it has now moved down the list to #8, while things like appreciation for your work and good work-life balance are in the top three. Is the retail industry adapting to these preferences? The high turnover statistics and wave of predictive scheduling legislation to give employees more work-life balance and end on-call shifts would indicate otherwise.
Ignoring what job seekers are looking for in an employer is only the start. Retail has a far bigger problem that is rapidly coming to the surface, and they need to look no further than the transportation industry and the rideshare phenomenon to grasp it. Today, potential job seekers can choose from over 100 apps or websites to find their next gig. Just how many gig workers are there? According to Business.com, more than 50 million workers have entered the gig economy workforce in 2015, and a study by Intuit predicted that by 2020 approximately 40 percent of American workers would be independent contractors. Some of those gigs have to be in the retail space, right? Wrong. Retail is lagging far behind in adopting gig workers. The lone bright spot comes from Walmart; The Washington Post reports that the retail giant is now testing a package-delivery program where employees are paid extra to deliver online orders on their way home from work. That’s right, Walmart will soon be able to do last-mile delivery by giving their current workers an opportunity to earn more.
Now retail has long held fast to the idea that working for their brand is proprietary and sharing workers with other retailers would be blasphemous. But is merchandising really all that different between Macy’s and Nordstrom? Doesn’t cashiering, restocking shelves and picking orders require a similar skillset regardless of whether you work for Walmart or Target? The seemingly obvious answer is yes, and there isn’t any reason why a talented merchandiser couldn’t pick up gigs or on-demand work from different retailers. Embracing this change could really set a retailer and its brand apart, particularly when looking to hire Millennials and Gen Z.
The takeaway here is for retailers to keep Humanism top of mind, or at least progressive human resource and staffing strategies as a key element in the plan, to thrive through the retail Renaissance.
How JDA Can Help
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