Retail Audit Lexicon

February 15, 2012 Leave a comment

Why a retail audit lexicon?

Most industries and activities have their own language, their own vocabulary to describe the various facets and nuances of the trade.  Retail audits are no exception.  Since we could not find a suitable lexicon for retail audit terms, we built one.  This lexicon is based on the work of the Compliantia team and our interactions with 50+ retailers in North America, Australia and Europe.   This lexicon was built by retailers, for retailers.  Please use the comments below to suggest a new entry or edits to an existing entry.

A                                                                                                                                                                          

Acknowledgment
Also known as  Electronic signature, Sign-off

Visit acknowledgment is akin to an electronic signature. It gives the store manager, franchisee or operator the chance to acknowledge that the visit did take place. While the acknowledging user may not alter the visit, he/she can comment on the visit.  Acknowledging a visit generally “locks” it from further changes.

Action Plan

The action plan is an opportunity to apply corrective actions to problem areas. It designates an individual responsible for rectifying each problem and a target date. It allows district managers and store staff to work collaboratively, view each other’s notes and add their own. It allows for corrections to happen without incurring large time and labor overheads.

For more information on the action plan, please refer to The Mighty Action Plan

Audit
Also known as Field Audit, Store Walk, Store Evaluation

A retail audit consists of a user, usually a district manager, checking for compliance with operational, service and merchandising standards at a given store at a given time.  An audit is based on a form.  A visit can be announced or unannounced.  A visit can be scored (if form items carry points) or not.  A visit can be followed up with an action plan or not.

B                                                                                                                                                                          

Best-practice

According to Wikipedia, a best practice is “a method or technique that has consistently shown results superior to those achieved with other means, and that is used as a benchmark”. Best practices are the backbone of a retail audit program. Best practices are typically reflected in the contents of the form(s) used for store visits.  Best practices generally exist to increase sales, customer satisfaction and/or health and safety while reducing customer complaints, losses and risks.

C                                                                                                                                                                          

Calibration

Selecting, vetting and testing retail audit forms with a sample group of users and pilot stores prior to general launch.  For more information on calibration, please refer to Calibrate for Success.

Closed-loop

An end-to-end process or workflow that identifies, assigns and closes issues. A closed-loop process does not just report problems, it facilitates handling and closure.

Cloud
Also known as Software as a service

According to Wikipedia, “Cloud computing provides computation, software, data access, and storage resources without requiring cloud users to know the location and other details of the computing infrastructure.”

In a typical cloud scenario, customers own the data while the cloud provider owns the application and the infrastructure. This leads to rapid deployments and allows customers to focus on their business, not the technical delivery of the service.

For more information on the benefits of cloud computing for retail audits, please refer to Why Compliantia is a Service and Why That Matters

Compliance

Adherence to operational, service and merchandising standards, best practices and company policies. Scaling a multi-unit business while protecting the integrity of the brand and the customer experience at each location requires compliance tracking and a closed-loop workflow.

Critical Item

Often used in the food service industry, a critical item sets the entire section’s score to zero, regardless of other items in the section, if found non-compliant during the visit.  Critical items can be used whenever a customer or employee’s health and safety is at stake or when the business continuity is threatened by non-compliance.

D                                                                                                                                                                          

District Manager
Also known as Regional Manager, Area Supervisor, Franchise Consultant

A district manager is responsible for stores in a given district. The number of locations in a district varies by industry, location and brand, typically ranging from 5 to 30.

A district manager is a financial advisor, a coach, a consultant, a trainer and at times a disciplinarian. A district manager needs to communicate, educate, inspire, assist, verify and enforce. A district manager is the liaison between the stores and head office, the voice of head office at the stores and the voice of the stores at head office. It is a pivotal role, the backbone of the operations apparatus.

For some amusing examples of what district managers go through, read The District Manager Diaries

F                                                                                                                                                                          

Form
Also known as Retail Checklist, Store Checklist, District Manager Checklist

A form is a collection of items, grouped by sections, encapsulating the organization’s current standards. A form is created at head office. A form may include copy, best-practice images and attachments. Multiple forms can exist in the system concurrently, each encapsulating an area of concern or specific program, timeline and scope.

For best practices and tips on building a form, please refer to How to Build A Field Audit Checklist

Form builder

Tool used to create forms. In certain systems like Compliantia, forms can be created online using the form builder, or offline, in Excel then uploaded to the system.

R                                                                                                                                                                          

Real-time

A real-time system handles all operations, from data collection to reporting, in real-time. While generally superior to batch-time systems or systems relying on data-synchronization between client and server, real-time servers require a working data connection throughout the visit.  A real-time system may use a wired internet connection, WiFi , Bluetooth or 3G/4G carrier signal, or a combination.

Return on investment

The expected financial returns on the investment, a.k.a. the cost of launching and running a retail audit program.  For more information on the cost and ROI of a retail audit program, please refer to How Much Do Field Audits Really Cost?

S                                                                                                                                                                          

Score

A score is generally used as a high-level representation of a store’s overall performance with 80/85 generally considered a “pass”. If a point value has been assigned to form items, a score is automatically calculated at the end of the visit.

W                                                                                                                                                                          

Workflow

A workflow is a sequence of steps required to achieve a certain outcome. Retail Audit tools like Compliantia allow the organization to build workflows specific to each form and purpose. Workflows can be built by controlling user notifications, whether action plans are required, whether visit acknowledgments are required and more.

Filed under Field Audit Tagged with , , , , , , , , ,

Managing Expectations

January 17, 2012 Leave a comment

Scoring a store’s compliance with operational, merchandising and service standards can elicit emotionally-charged reactions.  Most operators/franchisees take pride in their work and can struggle with a disappointing visit score and district manager guidance.  Was the district manager too harsh or unfair?  Is my store really lacking in certain areas as the visit’s score, notes and action plan suggest?  It can be a lot to deal with on a professional level but also on a personal level.

While we understand an operator’s pride and commitment to excellence, we would be inclined to give the following advice to anyone disappointed with the outcome of their last visit:  1) Don’t sweat the score and 2) Don’t waste the opportunity.

There is no such thing as a perfect visit in retail.  Turnover happens.  Weather happens.  Human errors happen. Even the best operators let a thing or two fall through the cracks, occasionally.  Getting a less-than-perfect score is not, in and of itself, a grave concern nor particularly unexpected.  The best ball players in the world don’t throw the perfect pitch 100% of the time, neither do the best retail operators.

Team calibration plays a certain role in this and so does managing expectations.  Let us remember that the very purpose of a retail audit is not in fact to score, but to improve the store’s sales and bottom line.  Didn’t get a perfect score?  Were the store’s presentation, merchandising and service standards perfect in every way?   Perfection is a journey, not a destination.

So what’s the opportunity?  For a district manager, the opportunity is to hold his/her stores to the highest standards.  Anything less is unfair to the brand, the franchisee and the customers.  For a franchisee, the opportunity is to uphold and execute on those standards.   So don’t sweat a low score.  A low score can happen on any journey to greatness.  Focus on the opportunity, the end goal and a chance to do better next time.

Filed under Field Audit Tagged with , , , , , ,

The Mighty Action Plan

December 20, 2011 Leave a comment

It has often been said that you can’t manage that which you can’t measure.  Measurement certainly is a powerful enabler in and of itself.  Measurement allows trends to emerge, repeat unacceptables to stand out and performance to be aggregated and sorted.  However, the benefits of field audits span well beyond measurement.  How good is measurement unless you apply correction?  How good is a report unless you weave continuous improvement into the process?  How good is problem discovery without resolution and closure?

At its core, the action plan is a vehicle for improvement.  Success in retail hinges largely on execution. The action plan is, by design, execution.  The action plan is an opportunity to apply corrective actions to problem areas.  It designates an individual responsible for rectifying each problem and a target date.  It allows district managers and store staff to work collaboratively, view each other’s notes and add their own.  It allows for corrections to happen without incurring large time and labour overheads.

Building efficiencies into the action plan generation and follow-up is critical to the success of the field audit program and the return on investment of such a program.  Given the importance we place on the action plan, it should come as no surprise that, for every store visit,  the organization saves $73 when using Compliantia with much of the savings attributable to action plan efficiencies.

The action plan is the continuation of the visit, the key to getting resolution and closure and a prime area for generating time and labour savings and greater return on investment.  If each  problem area is an ailment, the action plan is the cure.  Don’t leave the store without one!

Filed under Field Audit, Pricing & ROI Tagged with , , , ,

Connecting Retail Operations Professionals

November 17, 2011 Leave a comment

The social media landscape is a powerful enabler for personal and professional advancement. It is however heavily fragmented. There are many networks and platforms to choose from. There is also a fair bit of “noise” in online communities: over-the-top self-promotion, irrelevant content and spam.  Where can a retail professional network with peers and find relevant, industry-specific socially-sourced online content?

As a service to the retail industry, Compliantia created and moderates two LinkedIn groups, specifically aimed at retail professionals.

We take our membership very seriously and vet all requests to ensure every member is a retail operations professional. Our focus is on quality, not quantity. We look for respected and experienced thought-leaders in the retail marketplace. Spammers need not apply.

We take content very seriously. Feel free to ask questions and help others with their questions. Commercial content is allowed provided it is relevant to a retail operations audience and lends itself to group discussions. Spam and personal attacks are not allowed and result in the immediate removal from the group.

Retail Audits and Store Walks: This group is about retail operations professionals helping one another. It’s about compliance with operations and merchandising standards. It’s about health and safety, loss prevention and driving retail performance, sales and customer satisfaction in a multi-unit retail environment.

District Managers, Regional Managers & Operations Professionals : This group is about retail operations professionals helping one another. We work with District Managers every day and understand the breadth and depth of skills needed. A district manager is a financial advisor, a coach, a consultant, a trainer and at times a disciplinarian. A district manager needs to communicate, educate, inspire, assist, verify and enforce. A district manager is the liaison between the stores and head office, the voice of head office at the stores and the voice of the stores at head office. It is a pivotal role, the backbone of the operations apparatus. This group is about district managers and what district managers do.

Filed under Field Audit Tagged with , , , , , ,

Calibrate for Success

October 11, 2011 Leave a comment

At the heart of any successful retail audit program lies a well thought-out, field-tested form.  A form is a collection of operating standards and best practices.  What goes on the form is a reflection of what matters to the brand at a given point in time (strategic initiatives, seasonal programs, etc…), what it is required to do (laws and regulations, health and safety, etc…) and what it aspires to be, operationally and in the eyes of its customers.    It’s no wonder then that retail organizations are unwilling to take chances on forms.  Multi-unit retailers often carefully build, vet and “calibrate” forms with a sample group of users and stores prior to general launch.   What are the purpose, benefits and some best practices for calibrating forms for the purpose of retail audits?

What is the purpose of calibration?

There are two facets and purposes for calibration: calibrating the form and calibrating the team.

Calibrating the form entails selecting, grouping and ordering what goes on the form.  This is often spearheaded by the operations team with input from other departments (merchandising, marketing, human resources, loss prevention, etc…).    Form items should be sufficiently clear and detailed while avoiding repetition.  The form should provide a good coverage of all areas of interest to the business and be laid out in such a manner as to optimize the district manager’s time doing the visit.  While a lot of this can be done at head office, there is simply no substitute for “hands-on” time in the field.  Giving a select group of district managers access to the form, even if unfinished, allows head office to fine tune and calibrate the form with real-world feedback.  It is often at this stage that unclear copy, repetitive standards or inadequate ordering are noted and addressed.

Calibrating the team is a type of audit-related training that ensures all standards are evaluated using a consistent and fair scale.  While the judgment of a district manager is tremendously important to the success of the audit program, consistency in the rating and grading are equally important.  Calibrating the team entails training operations personnel to have a shared understanding of the operating standards and how to rate and handle deviance.   Calibrating the team also means demonstrating where the definition of the standard ends and where the district’s manager’s need  to make a judgment call begins.   Dealing with people is not always as black and white as checking off a box on an electronic form.  The operations team needs to know how to handle sometime sensitive and confidential personnel issues for example.

What are some of the benefits of calibration?

In the old days (before real-time electronic tools like Compliantia existed), finalizing the form often meant printing a large and costly batch.  Changing the form would be disruptive and expensive as another batch had to be printed and distributed.  While this is no longer true with Compliantia (changes can be applied in real-time and at no cost), calibration still ensures the form is finalized by the time the program or operating period begins.  A calibrated form reduces confusion and facilitates the dissemination of operating standards as well as adoption.

Calibration also ensures standards are rated fairly and consistently.  Consistency breeds trust with the overall score and lends itself to aggregate reporting, comparisons across users, regions and time frames.

What are some best  practices for calibration?

  1. Start with a small group of users and stores.  The idea is to get feedback early and often before you deploy to a larger group.
  2. Test-drive the form in the field!  A form may look fine at head office but may prove to have some severe shortcomings when you actually conduct a store visit.  An inefficient form may cause the district manager to have to step back or repeatedly jump around the store to complete the visit.
  3. Narrowcast.  A Compliantia form can be narrowcasted (restricted) to certain stores and/or individuals.  Don’t bet the farm on an unproven form, run a small pilot and calibrate it until you are satisfied with the outcome.
Compliantia wishes to thank Fatima Miranda of Henry’s and Ian Blundell of 7-Eleven Stores Pty. Ltd. for their insights and contributions to this article.

Filed under Field Audit Tagged with , , , , , , , , ,

← Older posts

Follow

Get every new post delivered to your Inbox.