Where do I begin?
Before you make any changes to the way your business operates, take some time to reflect on your current practices and identify opportunities for improvements and cost-savings.
- Know what’s required. Make sure your practices regarding hiring and managing your employees are in line with the law. Check out the U.S. Small Business Administration’s guidance, “Hire and Manage Employees,” which offers clear, easily navigable information on basic state and federal labor laws.
- Identify any “pain points” that are causing low employee morale and productivity, high turnover, or steep costs to your business. Think through your existing practices for hiring, training, and providing professional development opportunities for workers. Below are a few initial questions to identify areas for improvement:
- Is high turnover causing my business to lose money?Am I finding it hard to attract employees with the skills my business needs?Have I struggled to hire employees who fit the “culture” of my business?Are my employees finding it difficult to fulfill their job duties?Do I spend too much time explaining tasks and retraining current staff members?Are performance and task expectations clear?Are my employees provided with frequent feedback on job performance?What does a “career ladder” look like for employees within my company, if there is one?Do I make available and communicate with my staff ways to grow within the business or develop new skills?
- Get employee feedback. Consider asking your staff about the effectiveness of your onboarding and training activities, as well as professional development opportunities. If you’d like guidance in gauging employee satisfaction with their job training and growth opportunities, check out these “20 simple Employee Engagement survey questions you should ask” from Culture Amp, and these questions to select from for a post-training evaluation survey from TalentLMS.
- Assess your employees’ existing skillsets. When thinking about how to prepare new staff members for their jobs, or to keep and promote existing workers, it’s helpful to get a sense of the range of skills your workers bring to the table. This process will help you discover new ways your employees can add value to your business, while also identifying skills your workers are looking to improve or develop.1Deloitte LLC and the Aspen Institute (2015). A Guide to Upskilling America’s Frontline Workers: A Handbook for Employers. Retrieved December 15, 2017 from http://www.upskillamerica.org/wpcontent/uploads/2015/04/Upskilling_Employer_Handbook_042015.pdf.
See the MindTools.com’s guidance, “Understanding Developmental Needs,” for advice on assessing your workers’ skill gaps. For guidance on ways to evaluate your staff, see the Employability Skills Framework published by the U.S. Department of Education.
Build a strong company culture. Your company’s culture consists of the behaviors, attitudes, practices, and overall vision you’re fostering within it. Think of it as a set of core values that you hold. When your employees’ values align with those of your business, they’re more likely to feel motivated in their work and less likely to leave for other opportunities. When looking for culture fit, consider the following best practices:
- Define your culture and make it clear to your staff.
Take some time to think through what you value, including characteristics you prioritize in your workers and yourself—such as integrity, responsibility, and reliability—and aspects of your business that distinguish you from competitors. Examples include superior customer service, high-quality products, or environmental sustainability. Engage your employees in this process too, to help collaboratively shape what culture can and should look like at your business.
- Experts stress the effectiveness of writing out a values statement or company mission to share with staff. For more advice on solidifying your values within your business, see “Build a Strategic Framework Through Strategic Planning” from The Balance, which includes guidance on and examples of values and mission statements.
- Evaluate the extent to which your hiring process makes clear your company culture. Companies with high retention rates make their values clear during interviews with prospective employees. Determine how effectively you communicate your company culture during your hiring process by including information about your values as a company in job postings, talking about your business culture during interviews, and demonstrating the culture through your interactions with prospective hires.
How can I ensure my employees develop the skills they need in an efficient, cost-effective way?
When you think of training employees, you probably think of the first few days after they’re hired. But training doesn’t just happen when employees start. Organizing ongoing training activities can be an effective way to hone skills, boost productivity, and keep employees engaged at work. Key factors to keep in mind when designing or evaluating your training programs are:
- Flexibility. Not all employees learn in the same way, so try to be flexible and take into account learning differences wherever you can. Consider pairing written training materials with hands-on learning and shadowing.
- Clarity. Successful retail trainings drive home what’s a “best practice” in the industry or at your company, versus what is an absolute requirement. Make sure your employees know where your practices and policies are flexible and when strict rules apply. Standardizing your training content and process will be key here. What do employees need to know to be successful? How can we make sure they learn each skill in the time allotted and have time to practice and improve?
- Follow up. Training should not be a one-time exercise. Studies have found that most people forget nearly 80 percent of what they’ve learned within one month if there aren’t follow-on activities to reinforce the information. If you can, revisit core skills and job duties with your staff often, making sure that they’re capable and knowledgeable in their work.
You can also reduce costs and avoid some of the main challenges associated with training with the following practices:
- Implement on-the-job training. Before incurring costs for formal training elsewhere, think about ways to boost your initial, in-house training and onboarding activities. Consider starting a one-on-one mentorship program for workers to learn from managers or other staff members who have skills they want. Making sure trainers themselves are well-trained will be key to setting standards for high performance. Allowing new employees to observe current staff and management can be a helpful first step before jumping into hands-on training. For more tips, see “The Best Ways to Do On-the-Job Training” from The Balance.
- Access state and federal grants, tax credits, and training programs. Federal and state government agencies offer monetary and programmatic support to small businesses to help train their employees and find talented workers. For more on how to find and apply for funding, see the U.S. Department of Labor (DOL) Career Onestop Business Center guide to Funding Employee Training. You can also search for a Federal Employment Training Program in your state through Career Onestop’s Service Locator. Finally, the DOL’s Employment and Training Administration connects users to an array of government workforce development services to help you find and keep talented employees, including through government-sponsored pre-employment training programs.
- Train on your organization’s values. Training and onboarding offer a great opportunity to share with employees what the company stands for, organizational values and culture, who your customers are, and how your business adds value for your customers. Infusing values into training can help illustrate how more specific or technical tasks fit into the big picture.
- Make sure your managers are involved managers. Studies have shown that entry-level employees flourish and remain with a company longer when they have a supportive manager who fosters learning and recognizes accomplishments. Effective managers also model desired behaviors, make clear to employees what their expectations are, and show employees how their roles fit within the company as a whole. For more on the importance of effective frontline management in new employee training, see FSG’s 2017 report, Investing in Entry- Level Talent.
- Use online training courses. Online training courses can help you cut down on costs, and offer convenient, flexible options for your employees. See the box below for some examples.2These services are referenced as examples only. PCV does not endorse any specific product or company, and advises small business owners to research and compare services to find the best option for their needs.
- The Small Business Administration’s Learning Center is a great one-stop shop for free online videos covering a range of topics in business.
- The National Retail Federation (NRF) offers online training courses and other helpful resources for retail businesses of all sizes.
- Retail Training Services offers specialized online training for a fee, allowing employees to undertake 15-30 minute modules in courses on sales, management, operations, marketing, and other aspects of retail.
- Dale Carnegie connects users to in-person or online courses offered for a fee on a range of business skills development, including managerial leadership, sales, and customer service.
- BizLibrary, a paid service, offers thousands of online training courses and videos organized by topic, from management tactics to workplace
- Track employee progress and make sure trainings are completed. It’s easy to overlook or fail to complete certain elements of job training once an employee is no longer brand new. But letting training activities fall by the wayside can mean you’re not getting the most out of your staff. Consider using a tracking system to make sure that all aspects of job training are completed. This could take the form of a simple checklist, or a more formal performance review in which a manager meets with each staff member one-on-one to monitor progress toward full competencies and skills development.
- Evaluate your trainings regularly. Studies have shown that high-performing companies seek employee and frontline manager input on training materials and activities.3Gilsdorf, K. and Hanleybrown, F. (2017). Entry-Level Employee Training, Investing in Entry-Level Talent: Retention Strategies that Work. Retrieved December 15, 2017 from https://assets.aspeninstitute.org/content/uploads/2017/03/Investing-in-Entry-Level-Talent.pdf. To ensure that trainings remain effective, engaging, and relevant, regularly check in with staff members and ask for their feedback on the training at your company. The “Training Evaluation Form Template” from HR Council Resource Index (mentioned above) can be used to gather employee input. Also consider using data from trainings to improve internal policies and practices for your employees.
- Never stop training. Training isn’t limited to new employee onboarding. Experienced staff should get periodic updates to their training, especially if they’re entering new roles or when new programs are launched.
- Build a more nimble workforce through cross-training. Cross-training, or training employees in multiple skillsets outside their normal responsibilities, benefits both employees and business owners. With a cross-trained staff, schedules are easier to make since staff members are more flexible and employees can more easily fill in for one another when someone is absent from work, or during periods where a position is unfilled. Cross-training also makes employees more productive: if they are trained in both customer and non-customer facing tasks, they can be flexible throughout the workday and always be contributing to the business. Developing employee skillsets across multiple roles also builds employee confidence and makes them more valuable to your business. To implement cross-training successfully at your business, consider the following:
- Frame cross-training as a non-monetary reward. Many workers will see the opportunity to develop new skills as an incentive, even if it doesn’t come with a pay increase right away. Cross-training can demonstrate to your employees that you’re invested in their long-term career growth.
- Offer skills-based raises. If you can, consider implementing a raise system based on skills- development. Even as rising wages add costs to your business, those effects can be offset by lower rates of turnover and increased productivity. While employees should expect to be trained on multiple tasks, providing rewards for significant skill development on the job can go a long way. For examples of how two different businesses implemented skills-based raises, see the case studies in the box to the right.
- Set up a mentorship program. Allow employees to shadow one another in order to learn new skills on the job.
- Make cross-training part of your culture. Foster a culture of support and teamwork by implementing cross-training in a team-oriented, transparent way. When employees understand the value of being able to support each other in their respective roles—rather than feeling individually “indispensable” to the business—they are more likely to share their skillsets with their team members. For more practical tips on instituting cross-training at your company, see “Cross-training Employees to Promote Engagement and Performance” from The Balance.
- Set up systems to help employees plan their work and support others when needed. Trader Joe’s has its famous bell system to call up additional cashiers when needed. Quick Trip employees will move to the kitchen when there are 3 or more orders in the queue to help speed up customer service. Make sure you have processes in place to help employees move between tasks when needed—whether that means they need to help a customer or what tasks are key to do when there are no customers. Critical to this is both systems and employee empowerment—employees should feel empowered to make these switches and identify where and how they can be most productive and most helpful to driving good customer experience.
How can I invest in my business to give my employees opportunities to grow professionally?
Professional development differs from training in that it involves your employee’s long-term career, even if they someday leave your company, as opposed to a narrow view of their specific role at your business. Professional development activities can take many forms, from providing on-the-job training in a new role to offering stipends for employees to take classes at a local college. Creating opportunities for your staff to learn and advance in their careers is an effective way to increase employee longevity at your company while adding value in the form of new skills. These opportunities can also be a great way to improve loyalty among your workers if you can’t yet raise wages or offer benefits.
The steps below can assist you in implementing professional development programs:
- Consider what a “career pathway” looks like at your business. It’s no surprise that workers at small retail businesses often feel they have no room for growth within their company. Some business owners and employees embrace this reality, and are mutually transparent about the “revolving door” culture. If you want workers who remain with the company for years at a time, however, think about ways to give them a path of growth within your company. If you can’t offer growth opportunities within your business, you can still boost employee engagement by enabling workers to develop new skills that will help them move up the career ladder when they do leave. Consider the following options:
- Look at career paths within larger businesses. Larger businesses within your industry can serve as a helpful model for what career advancement might look like for your business as it grows. See, for example, “5 Promising Career Paths for Retail Workers” from Monster.com, which details types of roles retail employees can grow into as they gain experience.
- Identify skillsets your employees need to be promoted. Creating opportunities for career advancement within your business requires knowing which skills employees will need in a new role with greater responsibility. The article “10 Things to Know about a Retail Management Career” from WorkitDaily.com details the skillsets generally needed to work as a manager in the retail industry, and could serve as a helpful starting point for employees interested in developing management skills.
- Find alternatives to traditional promotions. If you’re unable to offer opportunities for advancement within your business right now, consider other ways to help your employees take on more responsibility at work. While there may not be a fast track to management for your employees, there may be opportunities to build a career path through title changes and pay increases every 6-12 months based on new responsibilities, such as training new employees or taking on new projects that boost customer traffic. The detailed guidance offered by the Society for Human Resource Management (SHRM) in “Developing Employee Career Paths and Ladders” offers some alternatives to standard promotions, including job redesign, enlargement, and rotation.
- Be transparent about upward mobility from the outset. If you can’t offer many opportunities for advancement within your business, you’re more likely to find employees who accept this reality if you communicate it during the interview process. Alternatively, if your business does offer a career ladder, advertise the opportunities to candidates upfront. Taking these steps will help you identify the right candidates for open positions and keep those employees in the long term. For more tips on fostering upward mobility at your company, see “Create a Career Path to Retain Employees” from PayScale Human Capital.
- Set up a mentorship program. Establishing a mentorship system allows new and existing employees to build relationships, ask questions, and learn from those more experienced and skilled than they are. This system also provides a career step for your more experienced employees to become a mentor. For more on how to set up a mentoring system at your company, check out the Workplace Mentoring Primer from the Employer Assistance Resource Network (EARN). To see how mentorship can help your business, see “The Advantages of Mentoring in the Workplace,” from the Houston Chronicle.
- “Upskill” your staff and promote from within. Once you’ve identified a path of upward mobility at your business, look for ways to “upskill” your existing staff, or to help them learn new skills that qualify them for higher positions or bring new, needed skillsets to your growing business. Promoting from within greatly reduces the risks, time, and costs associated with hiring new staff members, but can also cut down on the need to pay temporary freelancers or consultants for special projects. For example, rather than bring on a consultant to help boost your social media presence, consider asking a staff member with promising communications skills to step up and take on the task. Engaging employees in this way fosters a culture of supportive growth within your business.
For more guidance, see Deloitte and The Aspen Institute’s Guide to Upskilling America’s Frontline Workers (we recommend jumping right to page 43, with “Getting Started”), which identifies work- based learning, continued education, and career navigation as the three central aspects of the upskilling process. The National Skills Coalition’s 2017 report Foundational Skills in the Service Sector also offers helpful advice for employers looking to upskill their workers (you’ll want to jump ahead to “Better Skills, Better Business: Steps Employers Can Take” on page 22).
“How often should I give performance reviews?”
The frequency of performance reviews depends on several factors, including your business culture, the number of employees you have, the frequency of engagement with those you directly oversee, and your own managerial style. Some experts suggest giving feedback as often as possible, whereas others advocate for semi-annual or annual reviews. Frequency really depends on what works best for your employees, your company, and your needs. Regular feedback (even informal) can help your employees understand their performance on an ongoing basis and enable easier conversations during more formal performance reviews. Consider asking your employees how and how often they would like to receive feedback. For more advice on conducting employee evaluations, see “10 Key Tips for Effective Employee Performance Reviews” from The Balance.Learn more
- Evaluate employee goals through regular performance reviews. Studies have found that working toward a meaningful goal is the top motivator for employees across industries.4Harvard Business School Publishing (2016). How Employee Alignment Boosts the Bottom Line. Retrieved December 15, 2017 from https://hbr.org/resources/pdfs/comm/betterworks/19764_HBR_Reports_BetterWorks_May2016.pdf. Performance reviews allow you to monitor employee progress toward goals in a strategic, replicable way. They also promote professional growth, improve productivity and job satisfaction, and help employees understand expectations. For effective performance reviews, consider adopting the following practices:
- Begin early. Talk about performance expectations as early as possible, including during the hiring process, so employees have a clear understanding of your standards and their goals in the role. During employee onboarding, describe your performance review process with new employees to help them understand how they’ll be assessed and create a culture of accountability.
- Consider using training as an evaluation period. Some employers set up training to be evaluative so expectations are clear from the very beginning, and if after 2-4 weeks of training, it is clear the employee is not the best fit, they do not continue–saving time and money and allowing the employee to move on and find the best fit for them.
- Define key performance measures. Employees should know what the performance measures of top importance are based on conversations with management (and— ideally, through visual reminders in the work environment). Management can help employees understand how their work directly impacts these key performance measures. Holding daily or weekly huddles between frontline staff and managers to talk about performance gaps and provide feedback can be a helpful way to manage these performance measures.
- Use standard review templates. While not everyone likes to use forms as part of their review process, if you choose to, you can access many versions of standardized performance review forms for free online. The “Annual Review Form” from the Society for Human Resource Management is a good example that can be adapted for different roles.
- Keep track. Throughout the year, keep note of employees’ performance to help provide a more accurate assessment of their work, supported by numerous examples. You can also ask for feedback from others within your organization who work closely with the employee.
- Have an in-person discussion. Take the time to sit down with your employees, walk them through the review process, and answer any questions they have. During the review, try to give feedback that’s highly specific: describe behaviors you’d like the employee to adopt, continue, or cease. Reviews are opportunities for you to address poor performance, set expectations for improvement, and/or praise employees for exemplary work.
- Give “feedforward,” not just feedback. Many successful managers choose to approach performance evaluations by focusing on ways that employees can grow and improve—on forward-looking considerations. For more information about the concept of feedforward and how to use it in your employee reviews, see “Stop Giving Feedback, Instead Give Feedforward” from Forbes.com.
- Encourage self-appraisal. Have your employees reflect on their own performance. Ask employees to write a list of their biggest accomplishments over the past year (or other given time period), or to reflect on their strengths and weaknesses in the role. You could also require them to fill out the performance review for themselves to allow for direct comparison with your comments.
- Conduct a 360-degree review. One practice that many businesses find effective is to assess workers from a 360-degree view—meaning that managers seek feedback on employee performance from peers, those managed by the employee, and others the employee under review works with on a regular basis. Obviously, this review may not be practical for your business depending on its size, but the idea behind this kind of review is to give managers a more complete understanding of an employee’s performance. For more on ways to conduct 360-degree reviews, see “Best Practices in a 360 Performance Review” from The Balance.
- Reward high performance. Offering bonuses is an effective way to reward employees for meeting or exceeding goals. For more on bonuses, see the section on wealth building included in this toolkit. Incentives for high performance do not always have to be financial, however: taking steps as simple as starting an “employee of the month” program or publicly praising successful employees can go a long way toward fostering a culture of high-performing workers.5See “A Note for Small and Medium-Sized Employers.” Deloitte LLC and the Aspen Institute (2015). A Guide to Upskilling America’s Frontline Workers: A Handbook for Employers. Retrieved December 15, 2017 from http://www.upskillamerica.org/wp-content/uploads/2015/04/Upskilling_Employer_Handbook_042015.pdf
- Continue to set goals. Revisit the employee’s job description before a performance review and have a discussion about whether it remains accurate or needs to be updated. Based on the job description, set future goals that are meaningful, provide motivation, and can be measured. To read more about employee goal-setting, see “Make sure your employees succeed,” from the Harvard Business Review.
- Align employee goals with your business goals. Getting your employees to think about their roles not just in terms of performing basic functions, but also as driving the success of your business can make them more productive, engaged, and likely to stay with the company long-term. This process requires looking for alignment between the goals of your staff and the goals you have for your company. To ensure goal alignment, take the following steps:
- Seek employee input. One highly effective way to get buy-in to your business goals is to ask your staff to weigh in on what they think would benefit the company in the long-term. Your frontline and customer-facing staff members, for instance, might have great ideas about ways to boost sales or new products customers want.
- Communicate business goals to your employees regularly. When employees don’t understand what they’re working toward, they’re very unlikely to feel motivated to do their jobs well or look for opportunities to improve. Avoid this pitfall by being transparent about what you’d like your business to achieve—in terms of profits, sales numbers, new customer acquisition, or other measurable achievements—and how staff members can support these goals. These goals can even be captured on posters that are hung in the break room or through some other visual reminder.
- Review alignment often. It’s important to evaluate goal alignment regularly, but especially when your business objectives or strategies change. Make sure your employees are kept informed and have the chance to set goals accordingly.
For more on how to align the goals of your staff with your business, see “When to Change Employee Goals,” and How Employee Alignment Boosts the Bottom Line by the Harvard Business Review.
- Encourage staff to continue to learn outside of work. Offering educational assistance programs that help employees master new skills or receive certifications are a highly effective retention strategy for businesses, especially in retail.6See “Entry-Level Employee Training.” Gilsdorf, K. and Hanleybrown, F. (2017). Entry-Level Employee Training, Investing in Entry-Level Talent: Retention Strategies that Work. Retrieved December 15, 2017 from https://assets.aspeninstitute.org/content/uploads/2017/03/Investing-in-Entry-Level-Talent.pdf.
- Best practices for encouraging professional development activities outside of work include:
- Offer training or stipends to your employees. Consider developing ways of encouraging your employees to seek out educational opportunities, including by reimbursing them for tuition costs. While tuition reimbursement is not the right option for all business owners, many find that the added value of a highly skilled staff more than makes up for the upfront costs of classes and workshops. Other learning opportunities include industry-specific trainings, customer service workshops, or skill-specific programs.
- Make sure all learning is shared. To maximize your investment, you could require that anyone who undergoes external training must share what he or she has learned with the rest of the staff.
- Locate resources near you. In addition to the online resources listed above, the U.S. Department of Labor’s Career OneStop connects users to valuable information and resources to access professional development services, including:
- Local Training Finder: This searchable database helps workers find training opportunities in their area.
- Job Center Database: Here, users can search for an American Job Center near them, where they can receive in-person advice on ways to advance their careers.
- Professional Development General Guidance: This page offers tips on how to network, receive certifications, and navigate an industry, among other topics.
See the box below for examples of professional development programs and services.7These services are referenced as examples only. PCV does not endorse any specific product or company, and advises small business owners to research and compare services to find the best option for their needs.
- Created by the National Retail Federation Foundation, Rise Up is an online service offering certifications in numerous aspects of retail work, including customer service, sales, and inventory, for employees looking to move up the career ladder.
- Supported by a nonprofit association of grocery retail executives—Western Association of Food Chains—the Retail Management Certificate program is a one-year program that prepares workers for careers in different segments of retail businesses, and can be completed online or at a participating community college
- Manpower powerYOU is an online training platform that allows workers to build skills in areas such as word processing and communications, and receive certifications in specialty skills like computer coding and human resources. Additionally, Manpower’s Career Pathways tool also helps workers and employers identify upward mobility opportunities in retail.
What if I need to fire an employee?
While it’s not something most employers want to think about, firing employees is an unfortunate part of managing a business. It’s important to prepare yourself in the event that you might have to let a staff member go. The following best practices can help protect you as an employer, while respecting the rights of your staff:
- Have clear performance policies. Have a clear attendance policy, cash register over/short policy, a clear process for performance improvement plans, etc. so that employees know what is required of them and have clear, fair rules with opportunities to improve before termination.
- Discuss performance issues with employees when they occur. Don’t wait until the problems get out of control. Address bad behaviors among staff members when they happen so employees have a fair chance to improve. For guidance on confronting an underperforming staff member, check out “Ten Steps to Help You Plan and Deal with a Difficult Employee” from The Balance.
- Document instances of employee misbehavior, underperformance, absenteeism, or other issues. Gathering evidence of consistent problems with an employee supports your case for firing him or her in the event that your decision is challenged.
- Familiarize yourself with discrimination laws regarding the firing of an employee. Firing a staff member because of his or her race or religion, pregnancy, whistleblower status, or certain other characteristics violates the law. It’s important to know these laws even if you don’t plan to fire an employee, and regardless of the reason you want to let someone go. For more information, see “What are the laws on firing an employee?” from Gusto.
- Prepare for the termination meeting with your employee, and be direct. Gather your paperwork— including documents supporting your case for firing someone—and think through what you’re going to say before you break the news. For more advice on how to approach a termination meeting, see “How to Fire an Employee the Right Way” from Fit Small Business.