What will store tech look like over the next 5 years?
With much discussion around stores of the future and after years of underinvestment, many retailers are focusing on store tech again.
By Julian Mills, CEO and Co-founder of Quorso
What is a Line Manager?
Line managers have been the workhorses of the global economy for 3,000 years. Ever since humans started congregating in larger groups (e.g., city states or armies), leaders have relied on line managers to communicate with, train and motivate hundreds or thousands of workers. The first truly professional line managers were the Decurions and Centurions of the Roman army – and their 1:10 span of control has remained relatively unchanged for the last two millennia.
Today’s line managers are found in every industry and country. In retail, they are known as Department Managers, Store Managers, Area Managers, District Managers, Regional Directors and so on. In other industries, they are known as Branch Managers, General Managers, and so on. Some manage fewer than 10 colleagues and a few hundred thousand dollars of business activity; others manage thousands of workers and billions of dollars.
Today, there are roughly 28 million1 of these line managers in the world. Together they oversee over $45 trillion of the global economy. In fact, they are perhaps the most important population of workers in the world. Without them, quite simply, nothing would get delivered or done. Although we celebrate the generals, the strategists, the Elon Musks, the Jack Welches, without line managers, their visions would remain just that.
And despite claims to the contrary, the line manager is alive and well. Although academics and the media have been predicting their demise for decades, the Line Manager cohort is actually growing 4.3%2 a year – faster than the overall population
What do line managers actually do?
There are over 60,000 books on management currently for sale on Amazon, and over 1.5 million people3 professing to be management experts, advisors or consultants. (Hands up – as a former partner at McKinsey, I used to be one of them). So, I appreciate that anything I write now is up for debate.
In general, though, Line Managers are responsible for delivering business performance. And they do so in 3 ways:
For some reason, many managers tend to emphasize their ‘soft’ motivational skills – and clearly these are hugely important. But go on a store visit with any successful senior retail leader, and you will be astonished at how quickly their skill enables them to rapidly diagnose any execution errors in a store: It’s just harder to identify, talk about and pass on this tacit knowledge..
Why are Line Managers under pressure?
Over the last few years, the Line Manager role – especially in retail – has become massively harder. Nearly every senior retail executive I speak to is seriously worried about these pivotal roles. Why?
First, the nature of the role is changing materially. The average large business now collects 50x4 as much data as it did 10 years ago. And for good reason – nearly all businesses believe that decisions and actions are better when they are informed by data. In a recent survey5, 97% of managers said they believe data helps them make better decisions.
Much of that data is, though, finding its way to poor Store Managers, District Managers and their colleagues. For example, one large retailer Quorso works with now believes it has 1,000 sources of data relevant for store operations, and makes 200 dashboards available to its store leaders.
Managers are increasingly overwhelmed. 86% of managers in the same survey said they were so overloaded by data that they could no longer make good decisions. And at most retailers we work with, District Managers are spending 6-14 hours every week (15-30% of their time) just analyzing data.
Second, this data overload is contributing to manager burnout. A recent poll6 of 16,000 managers for the World Economic Forum concluded that 68% of managers were seriously exhausted. And the Economist magazine recently published a series of articles highlighting this issue, e.g. “Pity the modern manager – burnt out, distracted, and overloaded7”. This burnout is, in turn, leading to higher manager turnover (up 3.5x8 vs pre-pandemic). And as a result, at many retailers, managers are much less experienced than previously. In fact, the average time in role of a US retail manager is less than 18 months9.
Third, retailers are under continual pressure to reduce cost and improve productivity. Many have cut these vital positions or increased spans of control for above-store leaders. In part, retailers have been encouraged to do so by the ease of communicating directly with the frontline via Comms apps. However, many have found to their cost, that while technology has improved communication, it has failed to replace the skill or will that line managers traditionally contributed to operations.
In short, fewer, newer managers are running massively more data-rich, complex stores. As it stands, it’s not a recipe for success.
How can AI help?
“AI co-pilots” which help us do our jobs better and faster have existed for a number of years in areas such as insurance, medicine and sales. However, excitement for AI co-pilots has snowballed over the last 18 months driven, primarily by developments in Generative AI.
Generative AI co-pilots are increasingly completing activities for knowledge workers, which many of us have traditionally considered as ‘only-humans-can-do-this’ tasks. For example:
While the responses look breathtakingly human and creative, in reality, Gen AI is synthesizing and regurgitating terabytes of pre-existing ‘training data’ gathered from across the internet. More specifically, it is using deep learning models trained on huge datasets, like the common crawl to generate statistically likely outputs.
A co-pilot for Line Managers needs to address a very different kind of problem. Remember that a Line Manager can’t be everywhere and do everything, but needs to lean in to fix the highest priority issue in their work domain. So, their co-pilot needs to proactively tell them “this is the most important thing for you to do right now…and this is why”. Of course, there are many different variants of this problem, e.g.
We believe that a co-pilot for Line Managers needs to solve very different problems from those which a Knowledge Worker co-pilot does. Exhibit 1 below gives a few examples:
Exhibit 1
Quorso’s work building a co-pilot for Line Managers
At Quorso, we think a very different type of copilot requires a different technology approach. We believe that a great Line Manager copilot requires the fusion of 4-5 different technologies in a single, simple, delightful-to-use application designed for time-poor users who are always on the move.
The Quorso co-pilot we have been building for 8 years with some of the world’s leading retailers blends:
Using data and AI to guide managers and operations in this way is a fundamentally new approach. And the technology is only in its infancy. However, the results the world-class organizations we work with are seeing are very encouraging, e.g.:
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Please let me know if you’ve enjoyed this article. And if you have questions or a different perspective, I would love to hear from you!
1US Bureau of Labor Statistics; ONS; Quorso analysis
2Ibid
3 Amazon; Statista Research Department, December 2023; Quorso analysis
4 IDC; Statista Research Department
5Survey of 14,000 managers in 17 countries by Seth Stephens-Davidowitz
6Adecco survey of 16,000 managers in 2023 for World Economic Forum
7Economist, 24 October 2023
8McKinsey, ‘The Great Attrition’
9Quorso analysis of LinkedIn data and retailers’ job boards