Posts Tagged ‘Increase Profits’

NASCAR Racing Is Life! A Few Of These Tickets Will Increase Sales and Profitability

Wednesday, October 20th, 2010

In a previously posted article, Scorekeeping and Leaderboards to Drive Performance, the author discussed how measuring for performance cannot build fear and negativity into employees.  Driving bottom line performance with the right measurement will engage people and get people excited and committed to push performance levels.    Our experience with a retailer in Columbia, SC. proved that the right incentive can create a culture ready for the challenge.   In this case a large part of the company’s business plan was to increase their sales per guest visit.  The effort was a grass roots effort in which each employee picked a small, inexpensive item of the week that they would promote throughout the day.   At stake for the company was a goal of 2% overall increase in sales based adding an item of the week to one out of fifteen customer visits.   At stake for the employees was a pair of tickets to an upcoming NASCAR event.  It’s important to point out here that, for many folks from Columbia and points south, NASCAR is life.

Nascar_800px-Kurt_Busch_2008_Miller_Lite_Dodge_ChargerTo keep score they painted a miniature oval on the floor in the back office.    Each person got to choose a miniature car with the number of their favorite NASCAR driver.  Once the dust settled over who was going to get #3, Dale Earnhardt’s old number, the race was on.

Each time an associate sold their item of the week they got to advance their car one length.  The first ‘car’  to the checkered flag won.
It was a raucous week.  Lot’s of fun, lots of incremental sales, and the store increased its sales for the week by over 6.5% which was an unqualified success.

In addition to making the scorecard fun by picking a game board that the team related to and had an interest in, this team captured the essence of effective scorecards as motivators.  To be effective, a scorecard:

• Has to be about what I do

• Has to “talk” to me

• I Have to touch it and own it to believe it

• At some point is has to make me feel successful, whether it is hitting a target, showing improvement, or reinforncing my contribution

Simple, daily profit focused scorekeeping can be and should be fun.

Leave a comment telling us what was the most unique or innovative score keeping method you have seen in your company or another?

Or read this example of a poorly done scorecard: Scorekeeping and Leaderboards to Drive Performance

Two Bears: What’s Keeping You From Improving Your Bottom Line

Monday, September 6th, 2010

Innovation starts with leadership. The foundation of growth, increase profits and productivity are a clear vision, a prepared and enabled workforce, a culture of accountability, appropriate rewards systems and an environment that fosters creativity while preserving the values of the organization. Leadership that gets results is leadership that knows the way, shows the way and has prepared their team so they, as leaders, can get out of the way. Are you doing the same thing you have always done and expecting different results? Consider the story below and see if it sounds like behavior and processes in your organization today:
Bears_17429865_thumbnail

Two Bears: A Story About Change And Obsolescence

(An adaptation based on a story by Father Anthony de Mello)

A guide friend of mine tells the story of two hunters that came up to Alaska from the lower 48 to partake in their annual bear hunt. There are few roads to access prime bear hunting territory in the Agoolawok region, so a guide with a plane fit for the task is essential. A favorite aircraft for bush pilots in the region is the DE Havilland Beaver; a twin engine, amphibious plane that is capable on land, water or snow.

The two hunters hired out an experienced guide to take them in for a 6 day excursion. He dropped them off with their gear in the heart of bear country promising to pick them up at a designated time and place at the end of their outing.

It was a successful week and each hunter had bagged a decent size brown bear. They had field dressed the animals and, as agreed, the guide was at the meeting place to pick them up. Looking over the load including the two bears the guide suggested that the load was too heavy and they would have to leave one bear behind. Somewhat taken back one of the hunters proclaimed that the guide they had last year was very willing to take them out with the same load; the same two hunters with the same gear and two bear about the same size. Hesitant, the pilot looked the load over and did a little math.

“Are you sure it was the same load with about the same size bears?” the pilot asked.

“Yep” persisted the hunter. “Same stuff. I may have put on a few pounds in a year” he joked “but otherwise all the same”.

“Same aircraft?” the pilot wanted to be sure.

“Yep, DE Havilland Beaver” the hunter replied.

The pilot finally gave the ok. “Load ‘er up”.

They loaded up the plane and took off. Sure enough, about a mile out the aircraft didn’t have enough lift to get up over the next hillside. Fortunately the pilot was able to set the plane down safely in a clearing. It was a bit of a rough landing but no one was hurt and there was no damage to the plane. The two hunters climbed out and scrambled up the hillside to get their bearings.

“Where do you suppose we are?” one hunter asked the other.

“Best I can tell, just about a mile from where we had to set down last year!”

Airplane_1725764_thumbnailAre there instances in your organization where you are loading the “same two bears” over and over and expecting different results? Look at your business and see what processes, behaviors and routines are standing in the way of improving your bottom line profits. Get your leaders and your people involved and focus on driving business results.

Workers Only Average Three Productive Days Per Week!

Monday, August 9th, 2010

Of those people who work an average of 45 hours per week, approximately 17 hours of their week is considered unproductive.   It’s not just one nation or geographical area, but this occurs globally.   The Personal Productivity Challenge conducted by Microsoft in 2005 sampled over 38,000 people in 200 countries, in 29 languages about their productivity.  The study was based on 18 statements about their working environment and has some unsettling findings.

• People work an average of 45 hours a week; they consider about 17 of those hours to be unproductive.

• More than half the participants, 55 percent, said they relate their productivity directly to their software.

• People spend 5.6 hours each week in meetings; 69 percent feel meetings aren’t productive.

• Only 34 percent said they are using proven scheduling tools and techniques to help them gain more free time and balance in their lives. Likewise, 60 percent said they don’t have work-life balance, and being unproductive contributes to this feeling.

• Women had an average productivity score of 72 percent, compared with 71 percent for men.

• The most common productivity pitfalls are unclear objectives, lack of team communication and ineffective meetings — chosen by 32 percent of respondents overall — followed by unclear priorities at 31 percent and procrastination at 29 percent.
(Source:  Microsoft Personal Productivity Challenge)

Improving productivity is like pulling money out of the garbage.If you are responsible for Profit & Loss, top line growth, cost management, or higher productivity, this study should have your attention.  What type of impact would it have on your organization if you could reclaim the 38% of vanishing productivity?  Most organizations would be able to increase profits, drive down costs, and simply get more done with existing fixed costs and resources.  Surprisingly, organizations can do this by implementing the right tools and processes that:

• Clarify and communicate goals of the organization in a way that is relevant to each individual.  This requires commitment, results based leadership and is the responsibility of leaders, managers, and supervisors.

• Links the contribution of employees to organizational goals and helps them see why they matter to the organization.

• Use communication, feedback and coaching to build motivation and commitment all while helping employee see how meaningful and engaging the drive for increased profits  and productivity can be.

Develop your people to be more productive and performance focused.

Increase Profits: The Chocolate Chip Cookie Principle

Wednesday, March 24th, 2010

While conducting a business transformation on driving bottom line performance a few years ago for department managers in a chain of supermarkets, I had an interesting experience. One of the participants was a rather elderly and somewhat crusty Bakery Manager. His name was Lynn and at the first session he introduced himself as having been a bakery manager for longer than most of the other attendees had been alive. I took his unusual statement to mean that because of his experience he was unlikely to learn any new tricks or techniques about performance at any workshop, especially one facilitated by me.

 

You Can’t Teach A Old Dog New Tricks
Over the course of a couple of sessions, Lynn participated just enough to stay out of trouble with his boss, but not enough to gain much advantage as a manager. After the second session he told me privately that with his considerable experience as a manager he didn’t need to attend the sessions, but that he was being forced to attend. He told me, “You know old dogs can’t be taught new tricks. Well, I’m that old dog.” I thought at the time that he was trying to put me on notice that I should back off in trying to change his managerial style.

Lynn’s statement motivated me to look for a way to get his attention so he could benefit from the workshop experience. That’s when I concocted an experiment that not only taught him and his fellow managers a valuable lesson, but also me as well.

In the workshop I asked Lynn if he would help me conduct a “psychological experiment.” Before he could say no, two of his bosses were nodding affirmatively. Truthfully, I had set that reaction up in advance. Shame on me!

With Lynn obviously very reluctant to hear my proposal, I nonetheless pushed on. I told him that the experiment was to test the power of a graph, or scorecard, to motivate hourly employees to change their behavior. I explained that I would help him create a separate scorecard for each of his employees who worked the bakery counter on Saturdays. The scorecards would have the person’s name at the top, and across the bottom x-axis of the graph would be the dates of the next six Saturdays. Up the vertical y-axis would be numbers from 1 to 20.

Driving Results To Increase Profits
His employees would be instructed that each time they mentioned the words “chocolate chip cookie” to any customer in any way on Saturday they could put a mark or dot for that date progressing up from 1 mention of chocolate chip cookie to as many as 20 mentions. The measurement would be voluntary, because about one person in five typically doesn’t like to participate in such exercises that require competition. We would be happy to deal with the four out of five employees who find such exercises fun and exciting. The scorecards would be posted in the bakery back room and employees would be encouraged to keep their scorecard up to date as often as they could during the day. The experiment would use an honor system, where marking scorecards accurately would be up to the employees. Lynn’s responsibility would be to explain the exercise to the employees, have a positive attitude toward the exercise, and, of course, lead by example, because he needed a scorecard too.

At the next two transformation sessions Lynn gave brief progress reports on the project, but didn’t elaborate very much. I became worried that the experiment wouldn’t work and that Lynn might miss the point of it. But those fears were forgotten when Lynn returned to the last session and exclaimed, “Did you know that it’s possible to sell too many chocolate chip cookies?”Chocolate Chip Cookie_small

Lynn explained that by the second Saturday most of his employees really got into the exercise. It became a Badge of Honor to be recognized as the employee with the highest number of chocolate chip cookie mentions each week. Lynn’s assistant manager had a badge made at a local mall that said, “Chocolate Chip Cookie Champion.” The person with the highest mentions each Saturday got to wear the Champion badge during the following week, which further intensified the competition. Isn’t it interesting how a simple badge can create so much excitement? During the week his employees plotted what they were going to do and how they were going to get the most mentions. Lynn said that he had to adjust the rules because people “were taking unfair advantage.” One employee got on the store PA and mentioned chocolate chip cookies, then walked around the store counting how many customers must have heard her announcement, trying to claim those mentions. Another employee stopped in the middle of taking a cake decorating order and said, “Oh, by the way we sell chocolate chip cookies. Now how do you spell your son’s name?”

Apparently the competition got so intense and the bakery was selling so many cookies that the ovens were consumed with baking cookies, at the expense of the other products that needed oven time. That’s why Lynn exclaimed, “It’s possible to sell too many chocolate chip cookies.”

As a facilitator it was fascinating to see the change in Lynn’s attitude over the six session series of workshops. The crusty Bakery Manager became a champion of measuring, providing instant feedback, and healthy competition. He even told me in the last session that he had “learned a ton of new stuff.”

So how did Lynn’s cookie sales go? In his final report he explained that for as long as he could remember his bakery had sold about 15 dozen chocolate chip cookies on an average Saturday. (Actually, for a bakery the size he managed, 15 dozen is at best only a fair result, so I’m told.) The first Saturday of the project the bakery sold 27 dozen. The second Saturday they sold 36 dozen. The third Saturday they sold 67 dozen. The fourth Saturday they sold 117 dozen. And on the fifth Saturday they broke the bank, or perhaps the ovens, with 157 dozen chocolate chip cookies!

Increasing Profits 10X
The improvement over a month was a ten times increase. How did this happen? Providing frequent feedback to people who otherwise had not much incentive to suggestive sell cookies caused the incredible results. The personalized scorecards each employee had in the back room provided a method to measure performance. Thomas S. Monson once said, “When performance is measured, performance improves. When performance is measured and reported back, the rate of improvement accelerates.”

As Lynn was leaving the last session I asked him, “Well, was this experience worth it?”
With a slight smile on his face Lynn replied, “Maybe it’s possible to teach an old dog a thing or two. Thanks for your help.”