Faced With High Turnover, Retailers Boot Up E-learning for Quick Training

By Jessica Marquez

Aug. 3, 2005

Turnover is an issue that all managers have to deal with, but in the retail industry it’s an epidemic. Given that the jobs are often low-paying part-time positions that are usually filled by high school or college students, retention is almost impossible in certain retail businesses.

    This makes training a particularly tough challenge, says Mike Donahue, who knows the issue all too well. Donahue was once a manager of a Nike store. Every few months one employee would leave and another would start, and Donahue would have to start the training process all over again. “The intellectual capital resides only with senior people at the store, but eventually those people leave too,” he says.

    Seven years after his stint as a manager, Donahue, who is in charge of e-learning at Nike, was asked to design an online training program that the company could offer to employees in its own stores as well as at other retailers that sell its products. He knew that he and his team would have to design a program that would convey a lot of information quickly, but also would be easy to digest.

    “We knew that we did a great job of advertising and that we could drive people into the stores, but ultimately the person that is talking to the customer is a 16- to 22-year-old kid,” he says. “We wanted them to have a better dialogue with the consumer.”

    Nike faced a challenge that a number of retailers today are confronting as they adopt e-learning: Many of these companies face more than 100 percent turnover in their stores, and to train their staffs in a classroom setting is just not cost-effective or even possible for retailers that have stores scattered throughout the country, says Claire Schooley, senior industry analyst at Forrester Research.

    E-learning became a buzzword in human resources departments four years ago, but retailers only recently began installing the high-speed Internet connections needed to run such programs. Fifty percent to 60 percent of retailers have broadband or are installing it, according to research firm Gartner Inc.

    For retailers with a turnover problem, creating a training program that the average retail associate absorbs quickly can make a significant difference to the company’s bottom line, says Bruce Carocci, senior vice president of marketing and sales at Via Training, a Portland, Oregon-based e-learning company. “If my average associate stays on for six months but the regular training cycle takes four months, that is an issue,” he says. “But with e-learning, if I can get team up and running in six weeks, that makes them much more productive.”

The Nike experience
    With that mind, Donahue and his team knew they wanted their program to deliver information in short increments to make it easy for associates to take in–and keep them out on the floor.

    “We were throwing out ideas, and someone suggested that we needed to come up with something edgy, something underground,” Donahue says. That’s when the idea for the Sports Knowledge Underground was born.

    It was by pure coincidence that the acronym for the new program, SKU, also stands for the retail term “stock keeping unit,” Donahue says.

    The layout for Sports Knowledge Underground resembles a subway map, with different stations representing different training themes. For example, Apparel Union Station branches off into the apparel technologies line, the running products line and the Nike Pro products line. The Cleated Footwear Station offers paths to football, whereas the Central Station offers such broad lines as customer skills.

    Each segment is three to seven minutes long and gives the associate the basic knowledge they need about various products. As new products are introduced each season, the training is updated and Nike customizes the program for each retailer if requested. Associates are quizzed at the end of the training and asked for feedback, which gets routed back to Donahue and his team. “If we get feedback that something is confusing, we can go back and change it immediately,” Donahue says.

    Nike ran a pilot of the program in its own stores but now has Sports Knowledge Underground running at external retailers too, reaching about 20,000 associates. Donahue expects that number to quadruple in the next few months as the company continues to place the program in more stores.

    Already Nike has seen results. Stores that have implemented Sports Knowledge Underground have seen a 4 percent to 5 percent increase in sales. “The bottom line is if you can move the needle on the sales floor, it’s worth it,” Donahue says.

Setting standards
    For Nike, one of the most appealing aspects of introducing e-learning is that it sets a standard of learning for diverse workforces. The culture of one store may be vastly different from the next, Donahue says. “One of the problems that a lot of organizations face is that training is usually not a centralized activity,” says Peter McStravick, senior research analyst in learning services at IDC.

    That was one of the primary reasons that Cingular Wireless decided to launch a broad-based e-learning program in its stores when it acquired AT&T Wireless last year. “One of the key strategies for the business was to present a unified front for customers to minimize confusion,” says Rob Lauber, executive director of learning services at Cingular.

    Cingular had e-learning in its stores previously, but now it wanted to use the program to make sure that all of its employees, including those brought in from AT&T, followed the same procedures. “If you were a former AT&T customer and you walked into a legacy Cingular store and wanted a particular service, the training would explain how an associate should address it,” Lauber says.

    Cingular, however, had a unique challenge. For regulatory reasons, it could not go into the AT&T stores or talk to AT&T store managers about the e-learning until the merger was completed. That didn’t happen until October 26. The launch date for the “common services experience” was November 14. That gave the company 19 days to get all 19,000 associates up and running.

    Lauber and his team decided on mixing face-to-face training with e-learning. Two hundred trainers were sent out to the stores to communicate the culture and business strategy behind the new company. For more product and customer-scenario training, Cingular worked with IBM to develop the e-learning program. “It makes sense to use face-to-face contact to explain culture and leadership and things that set the tone for the employee and the environment,” says Susan Varnadoe, learning and development partner at IBM Business Consulting Services.

    To gauge the success of the training, managers quizzed their associates on the programs and the company is conducting pulse surveys of employees to make sure they feel they have the tools they need. Ultimately, Lauber says, the company looks at its business outcome to determine the success of the program. In the first quarter, Cingular saw a net increase in subscribers of nearly 1.4 million.

The future is mobile
    As technology develops, many major companies, such as Wal-Mart, are discussing how store employees could use mobile technology for training. Specifically, there are prototypes for using product scanners as educational devices, allowing an employee to scan a product and call up information about it.

    “Today a lot of learning makes associates go back to learning terminals, and that reduces the time they have on the floors,” says Susan Oliver, senior VP of human resources at Wal-Mart. “We are looking for avenues that would allow us to use the scanner as a form of learning so that you are putting learning in bite-sized segments.”

    Although retailers are eager to bring hand-held learning devices to their sales floors, just when that might become a reality remains to be seen.

    “In a year this will be all over the place,” Varnadoe predicts.

    But Ranjani Iyengar, director of learning and performance management systems at Hewitt Associates, thinks that timeline is ambitious. “There are still issues with content integration and the mainframes within retailers,” she says. “I think it’s going to be a long time before mobile technology is there.”

    Whenever stores begin implementing mobile technology, Nike will be prepared. The company developed its Sports Knowledge Underground program so that it could easily translate to hand-held devices, Donahue says. “When the retailers are ready, we will be ready,” he says.

Workforce Management, August 2005, pp. 74-75Subscribe Now!

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