Dive Brief:
- A group of researchers at MIT created a “good job score” to rate the jobs strategy of certain retailers and examine how companies create profitable job schemes, says Adjunct Associate Professor Zeynop Ton at MIT for Harvard Business Review.
- While some companies sacrifice customer satisfaction or employee satisfaction for lower costs of goods, Ton argues that “leveraging a skilled, capable, motivated workforce” can be just as profitable for retailers.
- The “good jobs score” is a way for investors and customers to see which companies in an industry are following good job strategies. It is calculated as the geometric mean of customer satisfaction, employee satisfaction, and productivity scores, rated from 1-10.
Dive Insight:
Ton and her students created the good jobs score first with food retailers. In their study, Costco Wholesale comes out on top, followed by Whole Foods Market and Publix. Wal-Mart and Weis Markets are on the bottom.
The customer satisfaction scores are calculated from data provided by the American Customer Satisfaction Index, Consumer Reports and Yelp, while employee scores were collected from Glassdoor and Indeed. Productivity scores were gathered from 10-K filings with the SEC and three measures of productivity: sales per square foot, sales per employee and inventory turnover.
The companies themselves were reticent when asked to provide the data for public consumption, Ton says, which meant the research group could not examine staffing, levels of standardization and empowerment or other operational practices between companies.
Despite potential flaws in the data (neither Glassdoor nor Indeed can prove employees who leave reviews actually ever worked at the companies they review, for example), the data sources were consistent with each other, Ton said.
“Clearly, investors concerned with how a company earns its profits — and whether it’s doing the best it could do for customers, employees, and the investors themselves — need better data to assess how well a company manages its operations,” Ton writes. “I hope that the good jobs score will encourage more companies to report these data.”
