Tesco: When cost-cutting goes wrong

The supermarket's clever response to high cleaning costs - getting store staff to do it on top of their day jobs - unsurprisingly hasn't gone down well.

by Stephen Jones
Last Updated: 23 Jul 2020

Earlier this week, Tesco unveiled a cunning plan to cut costs amid the global economic downturn. 

Gone are the costly third-party suppliers it usually relies on to clean shop floors, fridges and staff areas in its nearly 2,000 Metro and Express stores. It’s fine though. Rather than expecting shelves to gather dust (or germs) in a time of global pandemic, the company’s existing staff will take on the duties themselves, on top of their day jobs. 

In principle it appears to be a sound idea. Store budgets will be increased in order to give staff the time to complete the additional cleaning duties and, following a successful trial, executives say that giving individual stores autonomy over their own schedules leads to better and more consistent results. 

But that’s not how everyone sees it. At least some Tesco staff have described feeling “stabbed in the back”, with one telling The Guardian it’s a psychological blow to be expected to add additional duties when they’ve already been “busting a gut” to keep shelves full during the pandemic. 

Expecting staff to do more work on top of their existing duties - especially if that work is of a sort that they never signed up to do - can risk burnout, poor morale, absenteeism and higher employer turnover, all of which ultimately affect a company’s health and profitability.

In the longer term, unilaterally changing the terms of employment in this way can undermine the psychological contract between employer and employee, which has been so important during the COVID-19 outbreak. It’s a clear signal that we’re no longer all in it together, which is a loyalty-killer if ever there was one.

This isn’t just an issue for blue collar workers. Whether you’re insourcing cleaning or data analytics, it’s a false economy to cut costs but continue to expect the same output from your people, unless you have a particularly good reason for thinking they were being unproductive before. 

Even then, don’t expect that piling on the work will solve your productivity problem. Without addressing deeper reasons for low productivity, reducing a person’s bandwidth can very easily come at the cost of quality and the thoroughness of the decisions they make. 

Indeed, the traditional coping methods we turn to when we’re busy - working ever longer hours and multitasking - have both been shown to lead to declining quality of work if taken too far. Research into multitasking for example suggests it takes as much as 25 per cent longer to complete two tasks if a person switches between them midway.

Ultimately this leads to poorer decisions, more mistakes and lost productivity. Something that was not lost on the Guardian’s Tesco staffer: “If a store is not doing well then overtime gets cut and people end up being quite stretched. The danger is staff will not have enough time to clean properly.”

In a turbulent market, err on the side of your staff. The more motivated and productive they are, the better shape a company will be in. If the complaints of its disgruntled employees are representative of sentiment in the firm more widely, Tesco may find its cost clean up just ends up getting it in a mess.

Image credit: Dan Kitwood / Staff via Getty Images

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