Cashing in on good ideas
Sunday 06 August 1995
Ms Green is the latest recipient of Asda's company Jaguar. This is awarded for a month to the member of staff with the best idea for increasing sales of a particular product under its "VPI - volume-producing items" - scheme. She says: "I selected a flavoured milkshake as my project and then set about giving in-store demonstrations and developing recipe ideas. I also displayed the product in a more interesting way, and sales in our Rhyl store increased."
Asda has introduced prizes for innovative employee suggestions. A spokeswoman says: "Anyone from a shelf-stacker to a store manager can write or call chief executive Archie Norman with their ideas. They can win anything from a 'Tell Archie' pen to a weekend in Paris, depending on how good the idea is."
She adds that some of the simplest ideas are the most effective. "In our petrol booths we used to hand customers a clipboard and pen to sign cheques, but the pens kept getting lost, so they are now attached with Velcro. It may not sound much, but multiply the cost of pens across 200 stores and it soon adds up."
In using employee suggestion schemes and motivating staff by giving them the chance to win prizes, Asda is acting on the advice of Julian Richer, the owner of the hi-fi retail chain Richer Sounds. Mr Richer and his unusual management style are much-sought-after by other retailers keen to put his ideas into practice.
He offers staff who come up with the best ideas a day at Brands Hatch, a trip on the Orient Express, or a day at a health farm. Staff are sometimes given a fiver to go down to the pub and think about ways to improve Richer Sounds stores over a quiet drink.
Other companies have begun to think about how they can get the most out of people who know the business best - the staff on the shop floor or in the factory. Georgina Tate of the Industrial Society says: "British companies could save millions of pounds annually by tapping employee ideas better. Dusty boxes on factory walls have been replaced by computerised schemes offering holidays, cars or cash prizes to eager employees."
Ian Strachan, corporate communications director for Land Rover, says: "We have come a long way since the old suggestion box, which only ever had two suggestions in it, one of which was unprintable. We are now doing it in a much more professional way." Land Rover estimates that employee suggestions have saved the company pounds 3.5m in the past three years. It has a high contribution rate and has received 13,000 suggestions to date, although Mr Strachan admits that is because the rewards are high. The best idea under the "Bright Is" scheme can win pounds 5,000 plus a car.
Many of the ideas it receives are of a technical nature, but Mr Strachan says some are simpler, such as one devised by a team which fits seats. The members suggested the leather used for interior trimmings be cut differently, resulting in savings of pounds 500,000 a year.
Midland Bank also offers prizes of up to pounds 5,000 a year for good ideas. Last year it received 2,800 suggestions, and Andy Radcliff, manager of service quality, estimates that slightly under half are implemented.
Apart from the savings to be made, all agree that company suggestions schemes have another benefit - they motivate staff and make them feel like a valuable asset. Mr Strachan says: "Apart from getting access to ideas, it makes staff think about the work they are doing and it gets them involved. It makes them feel like a more important part of the company."
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