Getting Lean in the Retail sector: Bob’s Stores makes it happen…

Introduction

Based in Meriden, Connecticut, Bob’s Stores is a chain of more than 30 retail apparel stores located primarily in the northeastern U.S. Founded in 1954, the company offers name brand clothing and footwear. Facing strong competition, the company launched an organization-wide improvement initiative to enhance the overall customer experience.

In particular, the management team at Bob’s wanted to build a lean organization with a culture focused on customer value and waste reduction. They also wanted to create a culture of continuous improvement in which store associates would embrace change, have pride in their workplace and raise what already was a high level of service.

The improvement initiative was conceived with three key objectives in mind:

• Appropriate staffing. Bob’s wanted to improve its ability to forecast staffing requirements by using engineered standards, rather than sales volume.
• Checkout efficiency. The company wanted to identify and eliminate unnecessary activities that hindered smooth transactions at checkout lines, allowing associates to spend less time on checkout tasks and more time assisting customers.
• Enhanced service. Bob’s wanted to improve the customer experience by making it faster and easier for customers to locate items on the sales floor.

To meet these objectives, Bob’s engaged H.B. Maynard and Company, Inc. to help assess the company’s current state and provide expert assistance and training.

Using the 5-S Process

Maynard’s assessment revealed that several improvements could be made through better work methods and engineered standards. More importantly however, the assessment showed that such improvements could not be realized unless employees embraced a culture of continuous improvement.

To accomplish this, Maynard recommended a 5-S initiative, which would not only improve orderliness and eliminate unnecessary activities, but would also establish an environment prepared for further improvement.

5-S places an emphasis on and prepares an organization for lean operations. This requires a culture that is willing to change and review existing processes and methods, with a focus on the reduction of waste. 5-S helps to create an environment that is clean, orderly and safe. It also begins to open the company culture toward change and instills new discipline.

This new culture must focus on the importance of customer response time and value as defined by the customer. Once established, this new culture becomes the foundation for further workplace improvements.

Launching the 5-S Initiative

Beginning with a pilot project at one store, Maynard worked with Bob’s to develop a team of associates skilled in the disciplines of 5-S, best methods and engineered standards. A cross section of the sales floor, backroom operations and common areas were chosen to demonstrate that 5- S concepts are important to all areas of the store.

To kick off the project, Bob’s established a comprehensive rollout plan involving several teams consisting of store and home office associates. The teams were schooled in 5-S concepts and techniques by taking a half-day training course at Bob’s corporate office. Because all teams took part in the training, there was a heightened level of interaction among senior managers and sales floor associates, which reinforced management’s commitment to the project.

Let the 5-S Begin

With training complete, Bob’s management and sales floor associates began working with Maynard consultants to tackle the first “S” – sort and remove. The step involves the removal of all unnecessary items, leaving only those that are necessary to perform the work.

At the cash register, for example, many unnecessary items – broken hangers, old store flyers and broken bag stands – were tagged and removed to a holding area, repaired or simply discarded. Items were cleaned out of the holding area weekly, and decisions were made about where to place the items.

In the store’s backroom, the sort and remove process yielded even greater benefits. Through the process, store associates cleared off 42 8-foot shelves, providing Bob’s with 1,260 cubic feet of shelf space to either store merchandise or reconfigure for a more efficient backroom layout.

“5-S helped us to improve space utilization significantly in the store,” said Bob’s Stores’ Senior Vice President of Store Operations Scott Hampson. “This allows us to process and store additional inventory more effectively. This is critical during our peak selling seasons.”

Shine and Inspect

The focus of the second “S” – shine and inspect -- is to improve the condition and appearance of the work space, to make it look “like new,” and to inspect all items for deterioration.

At the cash register stations, associates scrub the work surfaces inside and out to make the counters clean and appealing. Associates also inspect each cash register, including looking for broken keys on the register. While a seemingly small matter, a broken cash register key could affect customer flow at the checkout line.

In addition, the floor of the processing area in the backroom was scrubbed and sealed to maintain a clean, fresh look. This helps to minimize damage to merchandise, as it reduces the chance of clothing becoming soiled if it is dropped during processing.

Set Locations and Visual Cues

This 5-S step involves creating a home location for every item and establishing visual cues so associates can locate items quickly. This process is implemented in several ways throughout the store.

At the store’s service desk, associates set alphabetical locations to organize customer holds and returns. Clear bins are used as visual cues, so associates can see what is in the bin as they approach it.

A mapping technique is used to help associates locate products in the backroom. Using a letter and number grid, employees can find products quickly. Vertical space is maximized by using shelving units, reducing the amount of space needed to store merchandise. A color-coded signage system, organized by merchandise category, helps associates locate products more efficiently.

Bob’s Stores uses color-coded signage on the sales floor to help “funnel,” or direct customers to their desired location. For example, if a man wants to purchase denim jeans, store overhead signage helps him locate the men’s department. Once in the department, additional signage funnels him to the jeans section, and to his desired brand of jeans.

Through 5-S, Bob’s Stores extended the use of color-coded signage to further benefit customers. Now when the man in our example finds his brand, he uses a color-coded key, located on each of the store’s shelving units, to find his size easily. He can quickly find his size because the denim labels are colored to correspond with the key.

Used throughout the store, the color-coding system enhances customer service by helping customers to locate items quickly and easily. It also reduces the amount of time Bob’s associates need to spend helping customers locate merchandise in their size, freeing them to help more customers with other needs.

Systematize

This “S” involves instilling habits to ensure the first three steps become incorporated into everyday routines. Techniques applied here include checklists and assignment maps. For example, checklists help cashiers determine what needs to be done daily, weekly and monthly to keep the front-end area in like-new condition.

Stay the Course

The fifth “S” is stay the course. To encourage store associates to practice 5-S concepts, Bob’s offers a recognition and reward program, and communicates 5-S values consistently to associates.

For stay the course, a reward and recognition system was designed to honor associates who exhibit the 5-S discipline in their work area. Bob’s senior managers and store associates created Gold, Silver and Bronze levels which were tied to 5-S achievements. Associates can win free movie passes or other prizes for various levels of 5-S achievement attained through weekly 5-S audits.

In addition, a 5-S newsletter was created and distributed to associates on a regular basis to update them on 5-S practices used throughout the store. A 5-S communication board was also located in the break room, to keep 5-S in front of all store associates.

5-S Results

Because 5-S is an ongoing, cultural process, Bob’s expects to see continuous improvement as a result of its initiative. 5-S results thus far have been very favorable. For example, the store:

• Improved efficiency at the front end, speeding the checkout process and allowing associates more time to support customers;
• Effectively used color coding and signage, allowing both associates and customers to locate items more quickly.

The initiative also significantly improved space utilization. As a result of 5-S tactics, the store:

• Disposed of 20 buckets of scrap metal, freeing up 360 cubic feet of space;
• Disposed of or reorganized fixtures freeing up 1,260 cubic feet;
• Cleared off every top shelf in the backroom to increase available space;
• Removed a trailer from the parking lot that was housing fixtures. This eliminated the need to pay rent on the trailer.

Next Phase

With 5-S implemented in all areas, Bob’s will shift its focus on best methods and engineered standards. By first establishing an environment of continuous improvement through 5-S, Bob’s will be ready to capitalize on the additional benefits that will result from implementing those processes.

5-S Results for Bob’s Stores

Store Area	5-S Results
Front-End Area/Checkout	Faster checkout times; cleaner work area; removal of unnecessary items improves work flow; associates have more time to help customers on sales floor
Sales Floor Associates	Associates can find products more easily; use of color coding helps customers find products
Backroom	Improved space utilization by freeing more than 1,260 cubic feet; additional space used to store merchandise, making the space especially valuable during peak selling seasons