RETEL TECHNOLOGIES

Recently, I read an inspiring interview with Dave Melton, one of Domino’s Pizza’s most successful franchisees. Dave owns and operates a number of Domino’s in the New York City market. And, while it might be easy to assume that his success stems from owning stores in the most densely populated metro in the USA, that is not the reason. In actuality, his success stems from having developed a very powerful and unique culture of rewards and recognition in his stores that make his staff feel and act like owners instead of employees.

When Dave started his first New York stores, he faced the typical set of challenges that retail and restaurant franchisees often struggle with. In particular, he inherited a set of hourly employees whose aim was to get as much out of the business as they could, do the least amount of work possible, and leave shortly thereafter to find a new job. In short, none of these employees approached the business from the perspective of the owner. Customer service was not important. Food quality was not important. And, most importantly, the long term financial health of the business was not important. And why was that? There was no reason for these employees to think otherwise, as their incentives – an hourly wage – were not aligned with the performance of the business.

Dave changed all of this. He created a culture of motivation and reward, with the express purpose of taking the best and brightest workers at the minimum wage level, and grooming them to be actual owners themselves. His employees have the authority to ensure customer satisfaction as they see fit (even if it means giving an order to a customer for free); they share in the successes of their store; they understand the long term impact of their performance on the business (Dave’s stores enjoy an incredible 0% attrition rate for frontline employees. Yes, 0%); and, most importantly, every employee from worst to best is aware of their performance and how they can improve it. As a result, Dave does not employee staff, but rather…owners.

Now, Dave’s situation may not be easily replicated in every franchise chain. But the model he has created has been proven in over 20 years of exceptional performance, and can be implemented in gradual stages by any owner/operator. What can you do to start following Dave’s lead? For one, you can begin by understanding how your employees perform in key areas that impact your stores’ customer satisfaction and financial health: customer service, cash and product theft, speed of service, and efficiency. Share this information with your staff, and let them know how they benefit from improved performance. And, most importantly, help them to succeed and see that their current position can be a stepping stone to future success.

To learn more about how ReTel can help you achieve this first step, take a look at our ConstantAudit service today.

To learn more about Dave Melton and his management philosophy, visit his website here.

To request this white paper, click here now.

As the world economy continues its weak recovery, internal shrink and fraud continues to plague both retailers and restaurants as the biggest source of loss for these organizations. The combination of a high volume of cash transactions, valuable and useful product inventories, cash-strapped employees and insufficient utilization of existing deterrent mechanisms has served to increase both the frequency and significance of these loss events.

Fortunately, there are many tools available to managers now to help curtail these losses, starting with understanding the employee motivation to steal at its psychological core, and then understanding how to replace these motivations to steal with motivations to perform.

To explain these motivations, our latest white paper explores the management concept of Expectancy Theory as it relates to employee theft and employee performance.

In this white paper, we will explore:

• The three psychological factors that determine whether or not an employee is likely to steal
• One simple change you can make today to instantly transform high-theft employees into high-performing employees
• How the same forces that hamper employee performance can also hinder management attempts to reduce shrink and increase revenues.

To request this white paper, click here now.

To learn more about Expectancy Theory, click here.

QUICK LINK: Download the whitepaper here – no registration is required.

Within the retail industry, it’s commonly known that internal fraud – that is, losses that occur because of employees – account for the majority of thefts and losses suffered by retailers. With the one exception of organized retail crime, these internal losses are typically the biggest concern for retailers’ loss prevention (LP) and asset protection (AP) departments.

Internal loss comes in a variety of forms. At the simplest level, asset misappropriation activities such as skimming (taking cash before it hits the books) and larceny (stealing cash and product that is already on the books) can be pervasive throughout the organization, from the stores to the warehouse to corporate HQ. At a more complicated level, corruption activities such as embezzlement are often more isolated to senior management levels, and are often very difficult to detect.

In their latest Report To The Nations, the Association of Certified Fraud Examiners (ACFE) surveyed corporations and independent CFEs worldwide to discover three key sets of data:

1. The types of fraud events that organizations typically experience
2. The total dollar amount associated with each type of fraud event
3. The average amount of time it takes to detect a fraud event

The report was both fascinating and sobering. Overall, most organizations lose five percent of their annual revenues to fraud. Factor in the low margins of retailers, and this becomes an extremely significant hit to the bottom line. Even more troubling, however, is that fraud events often go undetected for as long as two years. Early detection, and technology that enables early detection, therefore becomes paramount to organizations that suffer regularly from these losses. It can make the difference between profitability and significant losses.

We have taken the 2010 Report To The Nations and analyzed the key points that are relevant to retail LP and AP professionals. In particular, we look at the impact that early detection has on reducing losses suffered as a result of fraud. The white paper is available for download by clicking on this link, and no registration is required. Please feel free to distribute this white paper, and your feedback is appreciated.

ReTel Technologies will be exhibiting in booth 1140 at the
National Retail Federation Loss Prevention Conference and Exposition in Atlanta from June 14-16, 2010.

ReTel’s powerful surveillance discovery platform has been designed from the ground up to extract, organize and report on the valuable loss prevention, operations and marketing data captured by existing surveillance systems as efficiently as possible. ReTel’s surveillance discovery platform seamlessly blends the capabilities of a trained auditing workforce with the efficiency of cloud-based video processing to deliver next generation surveillance solutions with radical shifts in cost, accuracy and reliability.

To schedule a meeting at the show, please contact us today.

The team will be meeting with prospects, existing clients and security vendors and they look forward to forging new partnerships at this event.

In our last blog post, we spoke briefly about The Hawthorne Effect and how ReTel’s surveillance auditing services can be used as a mechanism to trigger it. In the post, we’ll dig a little bit deeper into the origins of The Hawthorne Effect, how it works, and case studies that reveal its power in operationally-driven environments, such as quick serve restaurants (QSRs) and convenience stores.

The History Of The Hawthorne Effect

At its simplest, The Hawthorne Effect can be described as a change in the performance of subjects under observation, simply because they are aware that they are being observed. In studies performed in the 1920s, researchers were baffled when upticks in performance during a study suddenly disappeared when the study was complete. As it turns out, the test changes made to the observed participants environments had only a nominal effect on their behavior; rather, it was the observation itself that truly had an impact on their performance.

How It Works & Why It Works

In many instances prior to observation, participants in studies were either unaware of their performance and therefore unable to understand whether it was good or bad, or they were aware of their performance but made no special effort to improve it because there was no means of measuring it, and therefore no incentives or punishments based on that performance. Once observation was established, however, participants became more aware of their behaviors, modifying it either explicitly or unknowingly to a higher level of performance. As those early studies showed, as soon as the observation or measurement mechanism was removed, performance soon slipped back to previous, lower levels.

Examples of The Hawthorne Effect in the QSR and Convenience Store Industries

Perhaps the most well known use of The Hawthorne Effect in these industries is with drive thru timers. Prior to the existence of drive thru timers, franchisors and franchisees had no way of understanding speed of service at the drive thru. By default, then, they had no way of providing employees with timing benchmarks or awareness of their performance at the drive thru.

With the installation of drive thru timing devices, certain chains saw an overall reduction of up to 29 seconds per order during peak rush times. Chains such as McDonald’s estimated that for every 6 seconds saved at the drive thru, unit sales increased by as much as 1%. It’s easy to see the impact that an improvement like this can have on a high-volume business such as a QSR.

What is interesting to note about these drive thru timers is that they do nothing else but provide highly visible evidence that the drive thru is under observation for speed of service. It is simply by knowing that they are being measured that the drive thru crews increase performance, which therefore increases sales.

Applying the Power of The Hawthorne Effect Elsewhere

ReTel’s advanced auditing technologies allow organizations to put the power of The Hawthorne Effect to work anywhere in their organization. Similar to the above example, ReTel’s customers have been able to realize significant gains in performance simply by measuring and providing awareness of measurement.