Sunday, May 09, 1999
Lazarus leader serious about customer service
Focus on training, staffing
BY LISA BIANK FASIG
The Cincinnati Enquirer
For every department store shopper who spent as much time seeking a cashier as she did finding a size 10 linen blouse, Arnold Orlick is thinking of you.
The Lazarus executive wants terribly to eliminate missing-cashier syndrome. He wants every sales associate to be attentive, happy and knowledgeable. If he dared to dream, Mr. Orlick would envision all Lazarus shoppers leaving his stores pleasantly surprised.
Mr. Orlick, chairman of Rich's/Lazarus/Goldsmith's, the division of Federated Department Stores that operates Lazarus, recognizes that good service can be as hard to find as a flattering swimsuit. He knows shoppers are annoyed.
“Nothing is more frustrating to someone who walks into a store than they like the goods that they have, but they can't get served,” said Mr. Orlick, who came to town recently to tour Cincinnati Lazarus stores. “They don't like the attitude of the sales associate; the sales associate didn't even smile and make them feel good.”
Customer service and retail experts say store service has been on the decline for several years, and they blame it largely on the consolidation of the industry. When companies merge, they usually do so to save money. That savings often comes from reduced training and staffing.
The missing cashier. The woebegone fitting-room worker. The disappearing Monday-morning sales associate.
Before long, the retailer risks losing the customer.
Lazarus has endured such a transition. In early 1995, the retailer moved its historic Cincinnati headquarters to Atlanta, to merge with the Rich's/Goldsmith's division.
This move, which entailed assimilating a staid culture into a new organization, was a risky undertaking. There was the change in management, and the needed cost savings. Some shoppers say service has suffered.
“I like to have people at the register who know what they're doing,” said Julie Lingler, 33, an independent public relations consultant who shops at Lazarus in Tri-County Mall. “That often is not the case at Lazarus.”
Lazarus, and its parent, Federated, have adopted programs to improve store service and reverse some of the problems that have stemmed from shortages. In the past year, the retailer has added to its service staff, introduced an in-house leadership institute and put some ears to the ground of employee territory. Some shoppers have noticed, praising the attentiveness of certain sales staff.
Lazarus' move to improve the shopping experience is an attempt to recapture market share and differentiate in an industry that not only involves stores, but catalogs and the Internet.
And perhaps not a moment too soon. Some retail observers think that in 10 years, department stores will be able to position themselves against the Internet only through personalized service.
“What department stores need to be thinking about right now is how can they be a destination?” said Roland Rust, a customer service expert at the Owen Graduate School of Management at Vanderbilt. “How can they create an experience?”
Lack of staff
Based on interviews with Cincinnati shoppers and service specialists, the problem at Lazarus isn't quality of service, it is a lack of staff. As Covington resident Alliea Phipps put it: “The problem I always have with Lazarus is walking through the door and finding somebody who works there.”
Ms. Phipps recognizes that the area's tight labor pool exacerbates the problem. And retail historically has been a high-turnover industry.
Mr. Orlick said Lazarus in the past year has increased the number of workers on its area sales floors by 10 percent — it presently employs 1,420 in the area. The company has reduced turnover by 30 percent year-to-date.
“We've established goals by store and for all of ourselves respectively to ensure we have minimal openings, and we minimize turnover,” Mr. Orlick said. “That's the key to customer service.”
In much of retail, there is not a set rule for figuring staff numbers — no standard of posting one person for every 100 square feet, say. Too many variables determine the number of salespeople needed at a given time.
Peak hours differ from downtown to the suburbs, with the former busy at lunch hour, the latter in the evening. The juniors department might be hopping at 3 p.m. weekdays, but childrens not until 7. And research shows that shoppers have a higher expectation of staffing in better sportswear, compared to second-tier brands.
Mr. Orlick figures as many as 200 people can be working in the 184,000-square-foot downtown store at a given time. Many are specialists of certain product categories, such as housewares. Many are brand specialists.
But not all service pros are impressed by Lazarus' efforts. Mr. Rust, the customer-service expert and author of several books on the topic, said Lazarus strikes him as “unremarkable” in the industry, in terms of service.
“Everybody gives lip service to service, but all you have to do is look at the number of people on the floor,” he said.
“The problem with the retailing industry in general is it only thinks of cutting costs to increase profits,” Mr. Rust said. He suggests that retailers improve service to propel profits.
Service complaints
Most complaints about Lazarus' service involve worker availability, not worker knowledge. Area shoppers who griped about empty work stations also offered stories about a favorite sales associate at a Lazarus store.
For Barb Pliskin, an Anderson Township mother of three, a lingerie saleswoman is the bright spot of her Lazarus shopping experience. Ms. Phipps, the Covington shopper, gets calls from a downtown Lazarus associate who informs her of promotions and new merchandise shipments.
“I think that they're really doing something wonderful with their employees,” said JoAnn Roth-Shumate, a 31-year-old Park Hills resident who shops downtown. “They're willing to go the extra mile.”
Federated last year introduced the Federated Leadership Institute, a 41/2-day program to strengthen leadership skills and prepare workers for organizational change. Course work involves building a better shopping experience for shoppers, conflict resolution and improving merchandise presentation.
The program operates out of Federated's headquarters downtown and through this year will be attended by all Federated store managers.
Lazarus sales associates receive one week of classroom training, which involves computer training and service presentations. Floor training continues for 90 days.
To keep tabs on these new workers, Lazarus human resources workers have begun sitting in chat groups with them, seeking feedback about their training experience and how it could have been improved.
“We have really begun to focus on our associates and create an environment where they feel good about the organization,” said Edwin Holman, president and chief operating officer of Rich's/Lazarus/Goldsmith. “They're having fun and therefore they're going to create an environment that's friendly and enjoyable to the customer.”
Lazarus ranks as the community's second-favorite department store after McAlpin's, according to the Cincinnati Prospectus 1998, a survey commissioned regularly by The Cincinnati Enquirer. Of the survey's respondents, 153,400 preferred Lazarus, compared with 324,800 who favored McAlpin's. The reasons that shoppers like Lazarus are value, convenience, quality and brands.
Only Saks Fifth Avenue and Parisian were cited for customer service in the survey.
It should be noted that some shoppers, including Ms. Roth-Shumate, switched from McAlpin's to Lazarus in the past year, following the acquisition of McAlpin's parent by Dillard's Inc. The reasons for the switch include confusion and frustration among sales associates and a less-friendly return policy.
Stephen Berman, principal at Kurt Salmon Associates, which annually surveys shopper response to retailers, said industry consolidation has made it difficult to communicate the service message. Often this is because merging companies reduce staffing and training in an effort to cut costs. Also, existing workers are forced to conform to a new management philosophy and rules, and the transformation can take time.
“Service really should be a part of a company's culture,” he said.
Facing challenges
Lazarus' move to improve the shopping experience may be an attempt to recapture market share. But the challenge will be achieving improved service despite low unemployment and ongoing cost-cutting requirements.
Mr. Orlick seems confident Lazarus can handle the task. He confidently said the chain has already overcome its biggest challenges since moving to Atlanta. One was the cultural transition. The other, knowing the Lazarus customer in each store.
Mr. Orlik thinks the organization knows the customer better today than a year ago.
“Why would you shop in one store vs. another?” he asks. “You'll shop where you have somewhat of a relationship, hopefully, with a sales associate, or a department manager or a store manager.
“You walk out of the store with a better overall shopping experience.”
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