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DSG International
Currys and Dixons Stores
Dixons and Currys are major electrical retailer chains across the UK. Dixons also have ‘Tax Free’ stores at all major UK airports. Together, in the retail stores, they employ about 13,500 people. The business faced issues in managing base pay, particularly around the increases in National Minimum Wage, and location and other allowances. In addition, the business wanted to explore new ideas of improving the return on its investment in sales commission.
Innecto were involved in supporting the business through developing a Reward Strategy, using our Reward Audit approach, and then conducting extensive analysis and market testing on a new approach to base pay. As part of the journey, we worked with Currys to create a job evaluation system and a basic career structure in stores. The outcome allowed employees to visualise different routes they could take to improve their career and pay prospects, and clarified what was expected from the employee at each level. We linked the work with existing and new competence frameworks and performance management and training systems. The new approach to base pay was rolled out from May 2005, finally going live at the end August 2005.
In addition, we helped the Design Team develop a management pay structure, taking into account not only the size of the store, but other criteria, adding up to a ‘degree of difficulty’ in running a store. This allowed Regional Management more flexibility in developing succession plans and performance management.
Finally, we developed several options for replacing current use of sales commission with a team-based success sharing philosophy, to encourage all members of the store team to own sales and customer service in their store. This is currently being piloted in 24 stores across Scotland.
Currys had a culture of creating high performing individual sales colleagues, who interfaced directly with the customer, and received direct commission on everything they sold, sometimes with extra bonuses added by manufacturers or internal competitions.
Karen McKeever, project manager, speaking at the CIPD Reward Conference in 2006, discussed how the Executive team were prompted to start thinking the unthinkable – to shake-up the system of individual commission which had been the norm in Curry’s stores for almost a generation.
Innecto developed options for change with the project team, ranging from small steps to major and radical change. The Currys’ management team took a deep breath and decided to go for the most radical option – a completely store team based approach, which focussed on sales, but also store profitability, including some key KPIs such as store staff overtime, stock shrinkage and customer returns. Deborah Rees at Innecto comments;
“It was the most radical solution, but we knew that it met the stated needs and objectives of the ‘new’ Currys. It was fine to develop the outlines in principle, but the more difficult piece for Innecto was doing the specialised detailed modelling to ensure that Currys could afford the plan, and ensuring we had accounted for a range of scenarios”
For more information - read the full case -study here Currys Case study_Innecto Reward Consulting
PC World
We consulted in a very different way with sister company PC World. The senior team had already gone a long way in the development and testing of ideas, and wanted an external perspective to help them think through the linkages to the business plan, and to ‘snag’ the schemes for potential problems. Innecto provided a few hours of hands-on review and discussion, to offer a sounding board and impart some expert advice in specific areas. PC World has now gone ahead with a chain-wide pilot of their new team-based pay approach.