Operations Strategy

Radioshack is in the customer solution business. Radioshack's mission is to help customers get the most out of their technology by helping them to understand the how's and why's to technology product use. Radioshack prides itself on having the best trained and most helpful sales associates. Their business strategy is to be the most reliable in information, customer service and have solutions/products for speciality projects. To ensure that the store focus stays aligned with the strategy: employees are required to become certified and must stay up to date to be able to interact with customers. Along with this monthly store meeting are held to insure everyone is on the same page, to accompany this , meeting are held weekly for employee reviews. To insure that information is current, Radioshack utilizes their intranet dashboard to instantly send updated information to all corporate stores, along with this each of their service partners have assigned support agents to insure that information is up to date and also to offer support whenever needed. Radioshack sets itself to be a channel for any company looking to showcase new products or even for an entrepreneur with a good product or service idea. Radioshack looks to be on top of the technology within their market and above their competition. Their operations mission is to emphasize new product introduction and adapting to different customer needs quickly. Again Radioshack sets itself to be the number one location for consumers to get solutions to all of their technology issues. They have been able to train employees and maintain consistent follow up for this they have been able to consistently be ranked number one in customer satisfaction. This reliability gives them the service advantage over competitors. They have not positioned themselves to be the least expensive retailer, they have set themselves to be the one's to offer the best customer service quality in their industry. Their operations strategy involves making sure that the products are available and that they remain flexible. To handle both of these situtations Radioshack has an automated inventory replenishment system along with manager controlled order placing. They have updated their supply chain management to make sure they are able to cope with the changes in the market. To make sure that inventory is kept flexible Radioshack uses inventory management software by Retek( Oracle owned). Although Radioshack imports much of its product their entire operations are managed and controlled from the U.S. Within the retail location their focus in on customer service as they feel that this will lead to customer trust and brand equity.

Project Scheduling

At radioshack scheduling is handled with much care to ensure that employees are available, customers do not wait and merchandise is available when needed. Radioshack retail locations being so small and customer count in the 100's effeciencyand product location is very important to keep customer service at a high. Store appearance and merchandise accessibility falls into the customer satisfaction category, because of this corporate has store locations under go major section changes once a month. This change adjusts for new merchandise, hot product relocation and better accessiblity to customers and is decided upon from customer and store feedback. The sections changes may at times take 10-12 hours to complete. This would be a tremendous amount of down time if scheduling did not occur. To ensure the least amount of distraction within the store much of the process is done 2 hours prior to opening and 2 hours after closing for 3 days. For a project of this size all employees are involved for diferent tasks at different times. Some of the tasks required are printing up-to-date planogram, taking down merchandise, put up new merchandise, pricing, clean up ,use of a time controlled chart generally one similiar to the Gantt Chart, audit of the completed sections for accuracy and confirmation that sections meet ADA requirements ( high maximium and spacing limits). One week prior to beginning the project the store manager and the assistant manager get together to layout all of the task that must be completed , the time it will take and the amount of employees available to complete the tasks. Once the chart is created they are able to see if there is any overlapping of employee tasks and if any task was left unattended or under attended. Most important the chart allows for a visual understanding of where time can be saved. Like most other projects employee input is not considered. The are simply told what and how to complete the tasks. Many employees that work for the company have been there for several years and have seen and learned alot. The experience they have would probably be beneficial in speeding up the process if not just create a new idea. Employee feedback is their current weak link. I would reccommend store feedback to ensure that employees are on the same page as the manager and vice versa.

Great video for anyone who has no understanding on how to create a Gantt Chart:

http://www.youtube.com/watch?v=CW_wGSFavTc

Supply Chain

Radioshack does not manufacture any product they locate suppliers in which the goods are preassembled. Radioshack locates the supplier with the lowest cost, places multiple orders to handle current demand and lead times. The orders are then shipped to the company warehouses. Corporate then uses data to decide the quantity and stores to ship to. Stores receive the merchandise and process begins again. To help maintain a successful and profitable retail location is the management of the supply chain. Radioshack must be on top of its game in this category because they have over 5000 stores to supply merchandise too. To ensure that they handle inventory and the transportation of it in the most efficient and cost effective manner Radioshack partnered with Manugistsics Group Inc. which monitors daily carrier performance and determines the most appropriate transportation method considering both service and cost. Retek(Oracle owned) which enables Corporate to manage store-level perpetual inventory and accurate in-stock for over 15,000 items across its 7,200 stores, and Celerant Consulting which analyzes overall business operations and creates customized programs to fill the specific needs. All three of these companies worked with Hyperion within RadioShack to ensure accurate, detailed and cost effective solutions to better manage the supply chain.

Since RadioShack has partnered with these three companies they were able to slash operating costs by $48 million such as reduced cost of goods, improved vendor terms and better logistics practive. Inventories were reduced by $200 million. Inventory turner increased from 2.1 to 2.6 times per year.

Radioshack is undergoing a major turnaround and have begun to make many of the needed adjustments. They have a much better focus on the 4 P's( Price, Product, Place, Promotion), the main key is not that they focus is better but they have the support and logistics in place to help them succeed.

Quality Control

Radioshack being a retail outlet has to maintain very high service quality levels. To begin every new employee goes through a 2 week training program on policy and procedure, there are 5 main exams that must be taken and passed before the associate is allowed to interact with customers. These exams cover selling, customer returns, customer service, TCF( Think Customers First) Quality Management,Customer Retention. Once a month employees are given a one on one review based on sales performance, returns and customer complaints. There are two inspection sources set in place to ensure great service and they are " secret shoppers" and store auditing. Each retail location is shopped twice a month and scores the store in 14 different categories. These reports give the manager a chance to continually improve there service by helping understand where the specific issues are. The shopper reports give managers a sense of the customer interpretation and the audit help managers to catch any gaps in pricing or product displays. Store Managers are encouraged to use the Deming cycle also known as PDCA. PDCA stands for Plan: Identify an opportunity and plan for change, Do: Implement the change on a small scale, Check: Use data to analyze the results of the change and determine whether it made a difference, Act: If the change was successful, implement it on a wider scale and continuously assess your results. If the change did not work, begin the cycle again. The managers first need is to identify the issues, the best process for this in a retail envirnoment like Radioshack is to use the fish-bone diagram. This cause and effect diagram gives managers an easy to read and translate map of where corrective action must take place. The chart is broken into the following categories: Price, Promotion, People, Processes, Place , Policies, Procedures and Product. Since quality control in a service industry is not an exact science this process must constantly be reviewed and improved upon by following the Deming Cycle in "cycles". Six Sigma is also used at store level because managers are focused on increasing productivity, reducing certain transaction times and reducing " do" overs from lack of training. This Six Sigma process is related back to the Deming Cycle where the goal is to plan, do, check and act until the wanted result is attained.

Radioshack does well in training it's employees and managers do well in following up with associates and making sure plans are being followed but what lacks is employee understanding of the situation. Radioshack Managers should begin to explain at least in simple terms what is expected but also why and have the associate become involved in the process. The associate input should be request since they are the onces dealing with customers.

Managing Quality

Technology is great but as it comes out and is new to the market it can be very overwhelming at times causing people to avoid it until absolutely necessary. Very early on Radioshack realized this need to demistify technology to the most technically savy and even the average person. They realized they had the opportunity to take this position in the market, to be the most trusted electronics retailer by being able to offer solutions to technology wonders. Radioshack positioned itself perfectly and changed their motto to fit " You've got questions, We've got answers." This was set as the motto to make customers aware that Radioshack was "the" place to get whatever they needed. This is what their service image was designed around. Having customers feel that Radioshack would be the only place they would need to stop at to get what ever solution they were looking for. But to be able to compete in the market and stay true to their motto their needed to be great management and employees. To ensure conformance with the corporate goal before becoming a store manager they must be certified at Answers University which is based in the corporate office. This would be a vigorous 1 week training course on all aspects of the business from proper scheduling to ensuring the store was 401 ready ( stores are graded from 101-on the floor to 401-100% sales ready). They covered how to handle complaints and turn it around into a positive, and were given the authority to do what was necessary to satisfy the customer within the guidelines given. As for the employees they needed to be certified as well but these are to be taken within the store, there are three different certifications that need to be completed, Customer Selling, Customer Questions, Customer Returns. Certifications need to be passed with a 100% or they would not be able to get on the sales floor. Every new manager or store employee(temporary or not) must complete the certifications. Radioshack has its own store site called Answers Online which allows all staff members to quickly research product information, check on order statuses, check future inventory and product comparison. The company focus was not to only have the information on hand but to be able to access it quickly and with the internet they have been able to do that. The high speed internet has allowed Radioshack to serve customers faster with returns, cellular and satellite activations and product lookups.

Radioshack has embarked on remodeling all of their company owned stores to give a much more colorful, bright and customer friendly scene. They have also realized through research that many women are very interested in electronics but don't shop very often because the stores are not "shopping" friendly. Well Radioshack has made sure to make all locations pleasing for women to shop in. To ensure that stores stay within compliance their is a daily checklist to make sure the store stays clean that must be completed and signed of by the person in charge. Customer Satisfaction is RadioShack's #1 goal, TCF-Think Customers First is their strategy name. Although everything may be in place to provide great service things can go bad such as computer failures, downed internet but at RadioShack their are no excuses and the customer must be served without fail. When these issues occur the staff is ready to respond by writing manual tickets, calling in to merchants for credit card approval and calling their buddy store to do stock look ups. The customer must be served the same when equipment is down as when it is up. This is the requirement throughout all store locations to ensure that customers feel we are reliable no matter what happens. The store is staffed with 3 people at any given time to ensure that all customers are attended to in a timely fashion and even for associates to better help one customer if their is a big situation. If the customer can not be serviced within ten minutes or so then we offer to take their name and number and offer to call them back once we have all the correct information for them. This avoids the customer waisting their time and getting frustrated. The store online site as well as special 800 numbers allow staff to quickly retrieve answers. Any service we offer is guaranteed for life, no matter whether the product was purchased from RadioShck or not the staff will be their to help the customer figure it out. Whether the customer arrives in the store or calls in the service level will be the same with the hopes in resolving or solving and customer issues. Radioshack is a neighboorhood store with low employee turnover meaning that faces and names are likely to be remembered. At meetings the District Managers makes it a point to make sure that employees are patient. The policy within the stores is to never argue with a customer and to get someone else involved to resolve the issue. Customers are not treated as such rather like family from start to finish in sale. The managers biggest concern in the store is to make sure that the quality of service is consistently offered by all of his employees. To help reduce issues the manager has setup a suggestion box that allows employees to take a personal role in how the quality is served up and making sure to continually improve it. What really helps to keep customer service quality high is to have monthly meetings ensuring that the employees understand the company and store level goals and how they are being planned to be achieved. The meeting allows for questions to ensure that their is not doubt that their is a purpose essentially it sets up the monthly goals and sets the motivation tone.

RECAP:

Quality of Design: Radioshack set out to be the one-stop center for all solutions to technology issues.

Quality of Conformance: Insuring that all Radioshack employees are trained and knowledgeable on current technologies, insuring that the company has tools in place to support the staff.

The Abilities: Availability- The company makes sure that stores are properly staffed, as for when the store is closed and customers need help, Radioshack has setup on their website electronics tutorials. This allows the customer to look up a question and have a video present the solution. The website also offers Connection Solutions which enlightens customers how to use their products by simply typing in the sku. Both services are available 24/7.

Reliability- The company has setup a system that ensures that even when computer systems crash that customers can still be attended to and that employees have other resources available to get answers quickly.

Maintainability- Radioshack is a neighborhood store and it sets itself apart by being available to customers for any of their solutions. A customer will never be left stranded for an answer or product resolution.

Field Service- This is very crucial to keeping the customer loyal. For customers that have purchased a product and is defective it would be exchange within 90 days at store level, once past that it would go to repair with a 1 week turnaround. The customer is called when the product is back from service. If absolutely neccessary because of prolonged service time, Radioshack will replace the item in store to satisfy the customer.

Quality of service can only go so far in a company trying to create a profit without the proper inventory mix. For the past year the company has been focusing on their turnaround plan which includes better inventory mix and better customer experience. The customer experience has been increased by changing store layouts, adding high speed internet to speed up transaction and much better staff training. Stores have been struggling with sales because of a poor product mix. Radioshack has been very focused on strictly proprietary profitable items that don't sell very quickly which then causes higher holding costs therefore reducing profit anyway. Radioshack needs to put much more research into product selection and do better in hiring purchasers. Having an exciting line up will encourage sales people as well as bring in new customers. Radioshack needs to get back to the basics and back to their initial push which was to demistify technology to the mass market.

Technology Choice

RadioShack is a service provider and it heavily relies on technology to better help customers in detail and do it much more efficiently. RadioShack depends heavily on knowledge workers within the retail location. These workers are the key to success within the organization because they have an understanding of the business and always weigh the options before making the final decision. As a support role to them Radioshack has a very complex intranet setup. Each store has a access to a digital dashboard that it standard throughtout the entire company but when logged into by the manager of the store it is customized just for the store, for example it will show past sales and customer trends, employee scheduling,profit analysis and it gives access to place orders electronically. Because RadioShack is in the service business being able to get the correct answer/ support quickly is very important that is why the digital dashboard has links to partner websites that are specifically designed for Radioshack. Having knowledge workers and proper tools ensures consistent customer service. RadioShack uses computer-aided process planning, decisions are made from statistics stored and calculated by the computer. To assure that the right staff is available and the right product mix is in the store, managers use a program called WorkBrain. This program gives recommendations based on the past either 2 weeks or 1 month of sales to help create a schedule that fits the flow of traffic. This assures that the right amount of staff is on hand only when needed. In assuring right product mix is in store the managers use an online purchasing called ESS ( electronic store shipments). This is updated daily with onhand and intransit inventories. This program gives the manager the ability to view what is in the store by product category or specific sku, it also allows them to see what has been sold in the past 4 weeks. The manager then has the ability to order what is needed, the program publishes its own list of recommended order items based on history.

RadioShack a very good setup when it comes to serving their customers, because staff is generally well distributed throughout the day every customer gets personal attention. The process in the store is as follows: The customer walks in and is approached by an employee, that employee stays with that customer as they shop throughout the store to answer any questions, they also check the customer out. If an employee is stuck on any question they can go to the company dashboard to retrieve practically any answer. Giving each employee the quick access to answers is the key to quick customer service. Radioshack also utlilizes their website to create great customer service, customers can makes purchases online and pick them up at any Radioshack of their choice free of charge. One improvement that should be made to help free up employees and get the "I just need a battery" customer is to have self check out. This would allow customers to grab what they need and quickly check out.

Radioshack chose to standardize on Hperion Business Intelligence. Hperion was chosen because of its comprehensive dashboarding, reporting and analysis capabilities. The Hyperion BI+ Suite's enterprise reporting and analysis capabilities provide information on trends that help the retailer understand merchandising issues, manage inventory, and create cross-selling opportunities. Dashboards present business users with the precise information that is relevant to them – in a highly graphical, interactive format – so they can make timely business decisions based on up-to-the minute information. For RadioShack, Hyperion BI+ leverages a new data infrastructure featuring Teradata's 5450 server. (Decideo.com) For payroll and benefits related situations Radioshack used PeopleSoft. This program allows any employee to access their information from any computer with their given name and password. PeopleSoft allows them to make changes and have them updated immediately.

RadioShack is an E-Retailer, they offer thousands of products online directly through them but they also link them with outside sources. For example if a customer wants to purchase cellular service online they are directed to a third party company that processes the transcation and is paid for the merchandise. Any product that is purchased online can be delivered to a home or business and most recently it can be picked up at a store.

WWW.RADIOSHACK.COM