Why is it that the same people who will easily spend hours playing Angry Birds each week won't spend an extra hour improving their retail operations? Saving money just isn't sexy or fun. It's boring, and that's the biggest problem. After all of my years in retail operations, I am still surprised how little traction well-developed back-office applications receive. You would think that saving money on inventory, labor or marketing expenses would be all the motivation that a retail owner or general manager would need, but that rarely seems to be the case.
This got me thinking about some of the new social applications, like Foursquare, and what makes them successful: Gamification. The concept of gamification involves adding game-like elements to an application to increase adoption and frequency of use. Typically, as in Foursquare, this is done by awarding "points" and "badges" for certain activities and creating a game-like environment. There is a leaderboard, and you are encouraged to "do more" to compete with the other players/users.
In retail, we call these key performance indicators (KPIs), which is about as sexy and cool as grandma's wallpaper. If you are lucky, you get a weekly or monthly report that has 200 or so numbers on it. You need to decipher what activities you need to do to improve your business. If this number is high, then get upset with Dan. If this number is low, then congratulate Sally. These applications are dry, difficult to read and rarely include any real action-based processes on what to do when the data doesn't say what you want it to.
But what if we took the concept of gamification and reframed our retail applications to be more like Foursquare? What if your same-store-sales number was put on a leaderboard daily against your peer set? What if you could become "king" of sales or receive a "mega-profit" badge?
Although it may seem like a subtle difference between traditional KPI reports (which may or may not even exist in the first place), it is significant. With a gamification-centered application, the entire experience is designed around being a game versus a report filled with red, yellow and green. The "Hunt For The Missing Inventory" Game or "The Inventory Turn" Game will likely be used more than the "Inventory Variance Report."
I imagine that some of you are laughing at that the idea of building a "Hunt For The Missing Inventory" Game. But inventory variance is a huge profit-suck and many, many retailers (especially franchise systems) do not pay any attention to it. If you could increase adoption of your back-office application by adding a few of these elements, isn't that worth consideration?
Looking to add a little more drama to your new game? How about: "To Catch A Thief."Looking to add a little more drama to your new game? How about: "To Catch A Thief." The goal of this game is to build real-life cases against employee theft. Many retail organizations have the POS and video data to build real cases of real theft, yet many general managers pay little attention to the data. "Reducing shrink" is not sexy or fun. But catching a thief, that's Law and Order/Dateline stuff right there.
One of the bigger problems that I have seen in retail applications over the years is this focus on data rather than business process. It seems like too many applications are designed around providing data to people, who must then determine what process to follow to correct bad numbers or continue good numbers. I know part of that is driven by the complexity and variety in retail operations between one location and another. But part of it is due to poor application interface development.
Organizations will spend millions of dollars developing a data warehouse to consume and crunch numbers to produce nothing more than a bloated Excel spreadsheet for users to consume. Why not go that extra mile and determine how to bring real usability to the application while adding gamification elements to improve its use?
Another thing that I often here is that "without some sort of financial reward, no one will use it." Although I agree that money is a great motivator (bribe) to use an application, I would argue that you might be able to do as well or better with gamification elements than with money, when it's implemented properly. There are hundreds of examples of applications thriving due to user involvement that included no financial gain for the users. Linux and Wikipedia come to mind.
Linux, used by a large percentage of corporate America, was developed and supported by people who had no financial incentive. Millions of people get information from Wikipedia when none of the authors receive financial benefit for their contributions. Citizen reports blog and tweet about the news for no direct benefit. The list goes on. These applications don't even have gaming elements, and yet still people contribute freely to their success.
But the executives at many organizations are skeptical about their employees jumping on the bandwagon and are reluctant to build in social or gamification elements into their applications. I've heard that it "sounds cheesy" or "would never work here." Just because execs don't see themselves doing it, doesn't mean that others in the organization won't.
I really don't want to throw the generation card here. But the reality is that when it comes to application design and usability, in my experience, there is a pretty distinct line between people older—and younger—than 40. Most of the executives making the business decisions around business process (read: application design) are older than that magic number. If you are older than 40, do yourself a favor and consider that you are likely as out of touch with application design as you are with music. If you don't like Top-40 anymore or don't have a Twitter account, you would be better served to let others in your organization make final application design decisions. Just sayin'.
So application service providers and in-house development organizations should seriously consider elements of gamification in their next software releases. It's cheaper than pay-for-use incentives and is an easy way to improve application adoption.
What do you think? If you disagree (or even, heaven forbid, agree), please comment below or send me a private message. Or check out the Twitter discussion on @todd_michaud.