October 25, 2004
Great Technology Is Little Help If Employees Don't Know
By Evan Schuman, eWEEK
Opinion: Best Buy is a great example of a company that brilliantly deploys technology—but then drops the ball in communicating.
As the holiday season approaches, we have good news and bad news on the major retail multichannel front. The good news is that some retailers are getting a lot better at handling the technology. The bad news is that their employees often don't know about it, making the advantages moot.
Retail executives are optimistically projecting a $220 billion holiday shopping season this year, with an average consumer spending of $702.03, which is a 4.5 percent increase from last year, according to a survey released last week from the National Retail Federation.
But will retailers be able to leverage their technology to capture as many of those dollars as they can? The answer may lie not just in what they do, but in how well they communicate it.
The last week saw an ideal example of this with Best Buy. Best Buy has cultivated a reputation within the retail community as being among the most sophisticated when dealing with multichannel issues.
Specifically, Best Buy execs are one of the few groups that seem to have taken to heart the inherent differences between virtual and physical storefronts and used technology to bridge that gap. For that, they deserve unrestrained applause.
But they made the common big-company mistake of thinking that deploying the technology and making it work is the end of the battle. Before they can persuade millions of consumers to buy, they need to persuade some 90,000 employees to understand what the company can do. (The $25 billion retailer announced this month that it will hire 25,000 seasonal employees beyond that number this season. I never said this "keeping everybody on the same page" thing would be easy.)
What kind of mixed messages are we talking about? Last week, for example, eWEEK.com was preparing to do a story about how Best Buy cleverly handles its purchase-online-and-pickup-in-store effort. The technology execution is wonderful, but it's precisely because the company didn't use technology to replace staff; it used staff to supplement the technology.
Best Buy started off doing what was needed: It focused on what people like about online (depth of details, range of options, convenience, easy comparisons and other research), what they don't like about online (cost of shipping, delay of shipping, inability to see and touch product before final purchase decision), what they like about in-store (touch, atmosphere, a person to talk with, can get the product immediately) and what they don't like about in-store (long lines and crowds, arriving to discover that the product that someone on the phone said was there is actually not there).
They then tried to craft a way to integrate online and offline that would preserve and leverage the good traits of each channel and minimize the bad traits. They came remarkably close with their plan to purchase online and pick up in-store.
Their twist was adding an employee to run to the aisles to absolutely verify that the product is actually there and then put it away for the customer before the customer is told to come and pick it up. The key? Moving so quickly that the customer has to wait less than 30 minutes for the human confirmation.
So far, so good. But here's where employee communication starts to break down. Best Buy has been doing this—at various levels—for three years. The 30-minute goal, according to at least one employee involved in the early planning stages of its site, has been in place since the beginning.
So why, one asks, was the Best Buy Web site—as of late Friday—still claiming a two-hour turnaround? That's a lot less compelling, especially given the fact that it's not true. In preparing a story about the technology last week, eWEEK.com went so far as to have reporters in multiple states test the system. Sure enough. The average was easily within the 30 minutes that a senior vice president of Best Buy touted.
It's not just the Web site, though. We called several customer-service reps to ask about the time issues. Every rep we spoke with said two hours, and most said "at least two hours." (For the record, this is limited to hours when the stores are open. Anyone buying online at 11:30 p.m. is going to have to wait until the next morning to have someone check the shelves, which seems fair.)
It gets worse. One of the key advantages of being able to do the pickup in-person is so that the customer can see the product and feel it before making a final purchase decision. The executive position is that the customer can simply decline the purchase. Unfortunately, customer service yet again didn't back them up.
One said the customer must phone customer service, wait on hold and then cancel the order because online and in-store systems don't talk with each other. Another said the customer must spend the time to completely purchase the item and then stand in another line to do a standard return.
Someone else had the best approach, which was to leave the package and walk out of the store. Ultimately, it would be returned to inventory without a customer charge, he said. But that screws up inventory and isn't the way this is supposed to work.
So, we went back to Best Buy to give them a chance to clarify. A PR person called back to say the reps may not be aware of the latest system upgrades. But this raised a non-academic question: Store employees, customer-service personnel and a host of in-field managers are the ones who execute policy, not PR people or senior vice presidents.
Who will be making the in-field decision? We called some Best Buy stores and spoke with the managers who actually handle the Web pickup areas. Sure enough, they said they didn't know how to handle "refused merchandise" and would likely take it back and then call the online people and wait on hold themselves to reverse the charge.
With some 25,000 temporary workers coming on board, it's hard to imagine that this confusion will improve much as the holiday-shopping insanity intensifies.
Please don't get me wrong. I give Best Buy a standing ovation for its technological execution, but when what it does is not properly communicated to the field, it truly raises the question of whether the company will be getting its money's worth out of the technology investment.