In a previous article, I (Paul O’Sullivan, Group Manager – Sigma Financial Services) said that our long experience tells us that there are five fundamentals that can go wrong in a pharmacy business. One of those is motivation and remuneration of staff – but there is another aspect of the staffing equation: productivity.
Any form of retail is a ‘people’ business, and this is more so in pharmacy where purchasers are seeking help in making decisions about their health and appearance. The people you hire and the way you motivate and enthuse them will make the difference between a good and bad shopping experience, customer retention and promotion, and thus impact your profitability.
Start at the top
Pharmacists are the lifeblood running through the veins and body of a pharmacy – bringing it to life. They are the most important point of contact with customers in need – so most able to inspire customer loyalty. They also have the ability to influence the working environment for your other staff. So, when you’re interviewing and employing them, make sure they are capable of being proactive and engaged.
If, as the owner, you are not working in the pharmacy yourself, you cannot just rely on the brand or the store manager to ‘do the work for you’. Owner-operated businesses are usually more efficient and better run, based on the very natural principle of self-interest!
Think about bonus structures for staff with measurable goals, and junior pharmacists being rewarded with equity or other financial and non-financial experiences for great performance. Aligning your staff’s rewards with your financial outcomes will help ensure your labour to sales/profit ratio never detrimentally impacts the cash flow of your pharmacy.
Develop your people
As a business owner you must also be a great leader. Get your staff to ‘buy in’ to your business by rewarding them for their investment. One way to do this is to develop subject matter experts in different product areas or services. This gives them pride in being a source of knowledge for their colleagues, and strengthens bonds between colleagues. It also makes staff more accountable for financial outcomes.
Another way to develop staff is to train them regularly – always challenging old habits and norms, as they can become too comfortable. People often resist change – so inspire and incentivise them to see things from another angle and then be open to new ideas.
Critically evaluate the role each staff member is playing in your organisation. Can you cross-skill to maximise efficiency of labour, whilst giving the team new skills and challenges? Periodically review your mix of labour and assignment of work to optimise outcomes. You don’t want your pharmacists or technical staff involved in administration tasks, impacting their ability to engage with patients and ultimately costing your business valuable profit and cashflow.
Retain the best
Good staff are vital to a pharmacy’s success – and no brand can overcome this. People will remember the quality and accuracy of the service they’ve received over the colour scheme of your store. Retention is even more critical in country and remote locations, as they are difficult and expensive to replace, and access to locums difficult to obtain.
An excellent way to motivate them to be better is to share your budgets and targets for areas of your business or seasonal campaigns. Make sure that you report back on successes – or near misses – and congratulate all of those responsible. Never set impossible targets as they are demotivating. Have them focus especially on customer loyalty and return patronage – a key imperative in these days of discounters.
Unfortunately, it is sometimes necessary for leaders to make hard decisions. Remember that your staff don’t have the same legal or financial risk that you do as a business owner, should it fail. It’s your business, so you need to make the well-considered but hard calls and often sooner rather than later.
Next up: how to minimise staff costs and risks
Besides the human side of managing staff in a small business, there are many potential costs and risks in the way you organise and remunerate your staff. As I’ve said, wages are one of the five things that can go badly wrong in a pharmacy. Some of the observations and advice we’ve developed over decades in the industry will be the subject of another article…
You can arrange for a comprehensive Finance Health Check – which examines financial and non-financial aspects of your staffing – through your Sigma Account Manager or by contacting Sigma Financial Services via pharmacy.finance@sigmahealthcare.com.au.
Your privacy is of paramount importance and any discussion is highly confidential.
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