Appetite for Retention
As most retailers know all too well, turnover among salespeople can be painfully high. According to NRF statistics, about one-quarter of retail employees quit their jobs in 2010, vs. an average of 16 percent across all industries.
One firm that’s doing something about its turnover rate is Checkers Drive-In, which operates about 800 Checkers and Rally’s restaurants across 23 states. Approximately 300 stores are company-owned; the remainder are operated by about 125 different franchisees, says Adam Noyes, the company’s chief restaurant operations officer. The restaurants, which serve burgers, fries and other sandwiches, offer drive-up, walk-up and patio service, but don’t have dining rooms.
Over the past few years, the company has focused on developing its IT and other systems to enhance consistency throughout its operations, Noyes says. Upgrades include a newly implemented back-office system that helps the restaurants better manage food, labor and other costs. “We want to drive results in a consistent way,” he says.
Automation and integration
One area that still lacked a system was the company’s approach to recruiting and hiring new employees. The process often was “one-off and manual,” Noyes says; managers had no efficient way to review all applicants’ suitability in a consistent and timely manner.
Noyes and his colleagues looked at a number of options for automating and systematizing the recruiting and hiring function. “The objective was to make it easier for managers to have a system for how they hire,” he says, “and also select better quality team members who stay longer and provide more consistent service.” The system chosen also would need to integrate with Checkers’ other back-office applications.
At the end of 2010, Checkers decided to go with a solution from JobApp Network. JobApp provides technology solutions to restaurant and retail chains and is used by about half the quick-serve restaurant chains around the country, says Blake Helppie, CEO of JobApp Network. The solution is targeted toward “any type of business engaged in de-centralized hiring, and mostly hourly” employees, he says, adding that both national chains and smaller companies find it affordable because the cost is calculated per location.
Helppie notes that hiring a cashier is not the same as hiring a lawyer or software developer. Many companies hire for those positions just once every few years; when that’s the case, it makes little sense to engineer the process. In contrast, many hourly positions experience much higher turnover rates. As a result, the investment required to engineer the process and improve results is more likely to pay off.
Engineering the process
With the JobApp solution, prospective employees can complete job applications either over the web or via a toll-free number (the process is essentially the same, regardless of the method chosen).
Helppie points out that even as companies move to web-based job applications, the phone remains an important tool for many lower-wage, hourly positions, as the candidates often lack convenient access to a computer with Internet connectivity. Moreover, applicants who use the phone to complete their job applications are two times more likely to be eligible for tax credits that would benefit their employer, Helppie says, citing his firm’s review of 25,000 applicants. For instance, employers who hire an unemployed veteran may be eligible for a credit of up to $9,600.
The review also found that candidates applying by phone are twice as likely to be members of a protected class -- that is, members of a group protected from employment discrimination by law, such as individuals with a physical handicap. Companies that receive applications only via the Internet run the risk of being seen as discriminating against individuals who don’t have access to computers. While some large retail chains can work around this issue by installing in-store kiosks on which candidates can complete applications, many smaller or specialty retailers lack the requisite funds or space.
As a result, even though offering a phone-based job application in addition to an online solution can cost more, it offers benefits. The exact difference in costs will depend on the retailer’s mix of web and phone applications, Helppie says, adding that the overall price still can be competitive.
Whether a candidate applies via the phone or online, JobApp will ask questions that address his suitability for a specific position. For instance, when assessing a candidate for a customer service position, the system will ask questions to determine the candidate’s affinity for working with other people. The solution also will inquire about more practical issues, such as the hours the applicant is available.
In addition, JobApp can offer computer simulations that help an employer judge how well the candidate will respond to different scenarios. For instance, it may present a situation in which an employee needs to mollify an irate customer. JobApp also can integrate many other services used in managing an effective hiring program, such as the ability to track third-party background checks, Helppie says.
Once a candidate completes the application, JobApp develops a composite score for the individual, ranging from one to five stars. Candidates receiving five stars are likely to be better suited for the positions available.
At Checkers, JobApp’s ability to match candidates and job openings has led to a 45 percent reduction in turnover, Noyes says. Other JobApp clients are seeing similar results, Helppie says, pointing out that employers may spend up to $1,000 to hire one employee. If a national chain can reduce its turnover by 1,000 people each year, it will save $1 million.
The benefits and savings don’t stop there. Once an individual is hired, all his paperwork, such as W4 forms or a direct deposit agreement, is electronically stored. The information from these forms is automatically and accurately sent to any other systems that will use it, such as payroll and time/attendance.
Streamlining these processes reduces the amount of time managers have to spend on paperwork and allows them to limit their interviews to those candidates most likely to be a good fit. In addition, electronically storing these documents can provide verification -- say, that an employee did receive the employee handbook outlining the company’s policies -- in the event of any disputes down the road.
The new process also allows hiring managers a comprehensive view of the pool of job candidates, regardless of where the application was received or when. Previously, a manager often had time to review only the applications of those who were the last to apply, even if they weren’t the most promising candidates.
In addition, a franchisee with several restaurants now can obtain a view of candidates across her portfolio. So if a qualified candidate applies at a location that doesn’t have any openings, the franchisee may see if he can work at a nearby outlet. The increased visibility helps retailers bring more qualified employees on board.
The average JobApp implementation runs between four and six weeks, Helppie says; if a franchisee is working within a chain that’s already implemented the JobApp system across the enterprise, it could be up and running within a week.
Checkers initially tested the JobApp solution in about 60 restaurants across three markets. Early in 2011, the company implemented JobApp in all company-owned restaurants. Next on the schedule is rolling it out to the franchise outlets.
So far, Checkers has seen significant benefits from the solution, Noyes says. To start, there are the savings directly attributable to the drop in turnover, such as a reduction in the cost of recruiting, as well as in uniforms and orientation sessions. In addition, the time savings that result from streamlining the hiring process allows managers to focus on other responsibilities.
Perhaps most importantly, because the employees now coming on board are better fits for the jobs available, Noyes says, “they’re more productive teams and offer a more consistent experience to guests.”
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