Saturday, November 12, 2016

Triangle Model

The standard principal agent model often takes on a triangle shape when one member must answer to both a superior as well as a client.  This can produce a series of issues and challenges.  From differing in opinions, to conflicting viewpoints, it can be difficult to please everyone involved in a triangle relationship.  Coming from several service related jobs, I know firsthand the struggles of a triangle principal agent model.  Below I will analyze and discuss some personal experiences with this version of the principal agent model.
To begin, I will again discuss my job at Nordstrom because in the retail setting, one is constantly trying to please not only their managers, but especially the customer they are helping.  The department that I was working in was the most expensive and exclusive in the store.  Because of this, we had several sales people who were considered personal shoppers.  A personal shopper was a sales employee who had been working within the Nordstrom store for long enough to have developed a list of clientele who shopped exclusively through this employee.  They differ from regular sales in that they are not so much on the floor trying to push merchandise to those just browsing.  Rather, they are taking phone calls from and meeting with repeat customers they have worked with for sometimes years.  These personal shoppers know when their customers are coming in and have pieces picked out and waiting for them when they arrive.  There are a series of benefits that come with the personal shopper title, including the ability to be more flexible with setting their own hours and a slight raise in commission.  One requirement of being a personal shopper was to meet a yearly financial selling quota.  If one could not meet this quota, they would lose their shopper tittle and go back to normal sales.  Another requirement of personal shoppers is that in addition to helping their typical clients, any customer can call Nordstrom customer service and schedule an appointment with a personal shopper at random.   This is where conflict would often arise from a triangle situation.  
Nordstom as a brand prides itself on its commitment to giving any and all customers a luxury shopping experience.  Because of this, they want shoppers of all budgets to be able to utilize the personal shoppers.  When a personal shopper gets assigned to a first time client through a customer service call, they often do not know much about that customer.  In my department, where sales employees and personal shoppers are used to customers spending several hundreds of dollars on their purchases, this lack of information became a problem when the customer had a smaller budget than my department coworkers were used to.  Everyone understood that most people could not afford to buy our specific product, but when the personal shoppers had a strict quota to meet, they are expected to maximize their sales as much as possible.  Personal shoppers were feeling pressure because what the customer needed and what managers expect from the employee were often different.  Managers would push personal shoppers to upsell, or get the customers to buy from the more expensive department, while the personal shoppers were trying to please the customers who wanted to stick to the less expensive sections.  This conflict left the personal shoppers in a position in the middle of trying to please two groups with differing viewpoints.  I feel that the biggest contributor to this conflict was the lack of communication.  The best way to resolve this would have been for customer service to gather information about the customer prior to assigning personal shoppers.  If they asked the customers what type of budget and experience they want from their appointment, they could better schedule the shoppers with those whose budgets aligned, satisfying the customer and the managers.  Simply spreading information could have reduced ambiguity and this cause of conflict between managers and employees.  This clarification would better give the customers a good experience  becuase they are dealing with a personal shopper who knows the merchandise they are trying to sell, rather than one who is not inspired or enthused about the product.  

4 comments:

  1. This is a good story. Some things you could clear up however. Did the personal shoppers get help sometimes from other sales people? Also, what would the consequence have been if the personal shopper simply determined quickly that this customer wasn't going to spend very much, so dispensed with the customer quickly to deal with other customers who would spend more? I didn't understand why that wouldn't happen.

    Finally, did the other sales people feel that the personal shoppers were eating into their commissions when new customers were assigned to the personal shoppers? It seems to me there was only downside to the particular business practice you discussion. Did Nordstroms come to realize that? Or did they maintain the myth that personal shoppers are appropriate for every customer?

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  2. I found it interesting to read about the company Nordstrom, since it is a big company and I have never been there. I can totally image how you would be confused by the situation and that it is hard to please both principals. I wonder if it would be better to communicate with the cheaper sections to maybe have personal shoppers for different sections. From my experience at Douglas, I know that having a client that doesn't want to spend as much as another client isn't less important. When losing this person as a client, because it isn't that profitable at that moment, can mean that you lose a client that will make bad advertisements about the company which will result in less customers. Just as you suggest, I think that the missing transparency for the client is the problem here. However, this idea is what I get from reading the blogpost and I have never experienced Nordstrom myself.

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  3. When working at Nordstrom, we are taught to treat every customer with the same enthusiasm regardless of price point. If employees were to simply disregard anyone who they decided was not worth their time, word would get around about this poor customer service. It is one thing to give a customer who wants to shop alone their space, but when a person goes out of their way to schedule an appointment for help, the personal shoppers know they are expecting that employees full attention. It would be as if a doctor disregarded one patient because another in the next room is paying more. Patient A is still expecting their fair share of the doctor's attention because they have paid for their appointment.

    Also, not every new customer wants to go with a personal shopper. I would estimate that one out of every twenty new customers utilized the personal shopper program. Most people only used this system for special occasions or if they were looking for a wardrobe overhaul. The average woman just browsing for a new top would most likely never schedule an appointment for this. In that regard, the personal shopper program was not a problem for other sales people. Nordstorm still uses the program because it gives the feeling of luxury and attention they want their customers to feel.

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  4. Wow! I've shopped at Nordstrom a couple times but had no idea that this was an available service.
    I enjoyed reading your story as it clearly outlined the triangle model of the principal-agent model. Also, I agree that having information about the shopper beforehand and coordinating a system of pairing the appropriate customer and personal shopper would've been a good idea. I think that this would've made the process more efficient and potentially save time. Perhaps this efficiency could've led to helping more customers and result in a higher sales.

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