We asked 500 U.K. managers about the state of their operations. Here’s what we learned.
If there’s one thing we’ve learned over the past few years, it’s that “business as usual” no longer exists. But particularly in industries like retail and hospitality, the operational pressures threatening to disrupt productivity, consistency and even revenue keep piling up.
To learn more about the state of operations in these industries, we went right to the source. We polled 500 U.K. managers in retail, hospitality and foodservice about the biggest operational challenges they’re currently facing, their projections for 2024 and much more.
Here’s what we learned:
Managers face an array of operational issues, but hiring and theft top the list
When asked about the biggest operational issues they’re trying to solve, staffing was one of the top responses, particularly for retail managers (no surprise there, considering our last poll uncovered a huge burden on managers when it comes to seasonal hiring). Updating training materials and theft were also top of mind.
- 65% of managers said hiring/staffing is one of the biggest operational issues they’re trying to solve. Other top-of-mind issues include:
- Updating training materials (61%)
- Integrating more technology into daily operations (56%)
- Addressing volatile issues like theft and violence (55%)
These issues threaten to impact the all-important customer experience (especially as demand and expectations grow)
With so many operational issues at play, it’s no surprise that over half of managers are concerned about how these challenges will impact the customer and guest experience. Happening in tandem are heightened customer and guest expectations that continue to rise and evolve post-pandemic. Respondents said customers have expressed the need for more well-versed and confident staff, quicker checkout options and more secure and safe environments.
- 55% of managers say their customers have expressed the need for more personalised experiences. Other needs include:
- More informed and knowledgeable store staff (64%)
- More secure or safer environment (56%)
- Quicker options for check-out, returns and payment (55%)
- More transparency about issues such as inventory, supply chain, pricing, order fulfilment, etc. (54%)
- 57% of managers are concerned they and their team are unable to meet customers’ expectations
Things are getting worse, but the long-term outlook is better…
Managers believe the operational challenges facing their staff have gotten worse in the last year, and concerns around safety and security continue to grow. And, nearly half of managers polled expect these issues to continue to get worse in the coming year. However, managers’ long-term outlooks are more positive, with the majority of respondents confident that the business they manage will be around in the next few years.
- 55% of managers believe working in customer service has grown more difficult for them and their staff over the past year
- 72% of managers are more concerned with the security or personal safety of their workers and customers today
- 48% of managers expect operational issues to get worse in 2024
- 77% of managers believe their business will still be around in 5 years
…Especially as managers gain empowerment from senior leadership
Managers are taking an active role in overcoming the challenges facing their locations, but they are looking to senior leadership to provide the tools, training and career advancement they need to feel empowered. Communication again is key here; over half of managers polled said they have communicated directly with their CEO, and over 60% said their senior leadership listens to and implements their ideas and recommendations.
- 58% of managers are communicating or connecting directly with their company’s CEO
- 76% of managers feel supported by senior leadership when trying to make business improvements
- 72% of managers said their senior leadership empowers them in their role through training, learning and upskilling opportunities. Other ways senior leadership empowers managers include:
- Providing opportunities for career advancement and growth (65%)
- Implementing managers’ ideas or recommendations (63%)
- Routine and open communication with senior leadership (62%)
- Networking and mentorship programs (54%)
Emboldened by support from senior leadership, managers are taking active steps to support a better brand and customer experience…
Perhaps part of the reason for the long-term optimism is the strong initiative managers have taken to address these operational challenges head-on. From increasing training to automating store functions and accessibility improvements, managers are actively taking steps to improve the customer experience—and the employee experience.
- 69% of managers are providing more training to staff to support a better brand experience. Other initiatives include:
- Implementing a dress code (64%)
- Increasing how often workers interact with customers (59%)
- Creating new platforms/channels for customers to provide feedback (59%)
- Increasing in-store location security and safety measures (57%)
- Changing in-store/location music (54%)
..And embrace emerging technologies and automation
In the wake of the UK’s AI Safety Summit, it’s clear that cross-sector AI is becoming increasingly prevalent, and retail and hospitality are no exception. In fact, 73% of managers polled feel comfortable introducing new technologies like AI to their staff.
But, there are concerns. Role confusion or replacement, compliance issues and a lack of understanding are some of the barriers managers feel will need to be addressed as AI becomes more integrated into the worker experience.
- 56% of managers are planning to automate employee training in the next year. Other functions they plan to automate include:
- Ordering/return/check-out processes (62%)
- Customer loyalty functions (56%)
- Scheduling (56%)
- Inventory processes (55%)
- 73% of managers believe AI can improve the customer/guest experience
- 73% of managers are comfortable introducing new technologies like AI to their staff
- 59% of managers are concerned that AI could take away jobs Other concerns managers have around AI include:
- It could speed up or slow down operations (63%)
- It could create new compliance standards to follow (61%)
- It could be biassed (59%)
- It could create confusion around job roles and responsibilities (56%)
- It could decrease job satisfaction (53%)
Barriers need to be addressed in order for retail and hospitality to fully embrace emerging technologies like AI
Despite the overall positive industry sentiments, 43% of respondents do not plan to automate any functions or areas in store next year. Why? There are concerns that need to be addressed, both at the manager and worker levels, to ensure that there is a clear understanding of how these technologies will change employees’ day-to-day, and how it will help them do their job.
- 63% of managers said the biggest barrier to introducing AI to their staff is a lack of understanding of what it is/can do. Other barriers include:
- Unknown return on investment (60%)
- Lack of time/resources (59%)
- Privacy concerns (59%)
- Lack of motivation to learn a new technology (59%)
What can we learn from these findings? Managers are playing an active role in driving the operational consistency and efficiency that retailers and hospitality organisations desperately need. But, there are barriers to success that need to be addressed and faced. Namely, a strong need for training and clear communication around the initiatives, improvements and emerging technologies that managers are adopting to stay agile and productive in a volatile, rapidly changing world.