Human Resource Management

in Retail Organization

Presentation by,
Dinesh K. C.
Roll no. 12,
S3, MBA, DCMS
 RETAIL ORGANIZATION AND
HUMAN RESOURCE MANAGEMENT
1) Designing the organizational structure
for a Retail firms.
2) Retail Organization Structures
3) Human Resource Management in Retail
4) Trends in Human Resource Management
in Retail
 Human Resource
Management
 HRM refers to the way people are managed in
an organization.

 Human resource is most important resource in

management and needs to be used efficiently.
This is because success, stability and growth of
an organisation depend on its ability in
acquiring, utilizing and developing the human
resources for the benefit of the organisation.
 Organization structure
 A formal structure where the various activities
to be performed by the specific employees are
identified and delegated, indicating their
authority and responsibility.

 is the formal system of task and reporting

relationships that controls, coordinates, and
motivates employees so that they cooperate to
achieve an organization's goals.
 Organization structure
should:
 Encourage employees to work hard and to
develop supportive work attitudes
 Allow people and groups to cooperate and
work together effectively
 Organization structure
 A retailer cannot survive unless its
organization structure satisfies the need of
the target market, regardless of how well
employee and management needs are
met.
 Most of the retailers do similar tasks such
as buying, pricing etc. but there are many
ways of organizing a retail firm.
 The process of organizing a
Retail firm
1) Outlining the specific task to be performed in
retail distribution channel.

2) Dividing the task among channel members.

3) Grouping the retailer’s task into jobs.

4) Classifying the jobs.

5) Integrating positions through an organization

chart.
1) Specifying the tasks to be
performed
 Buying merchandise
 Setting price
 Inventory storage
 Customer research
 Customer contact
 Facilitate shopping
 Customer follow up and handling
complaints
2) Dividing the tasks among
channel members
 The tasks which are mentioned in the
previous step does not needs to be done
by a retailer only. It can be divided among
the retailer, manufacturer or wholesaler,
specialist etc.
 3) Grouping tasks in jobs
 The tasks can be grouped into jobs. For
eg.
- Displaying merchandise and customer
dealings can be the job of sales personnel.
- Entering data and managing cash can be
the job of the cashier.
 4) Classifying jobs
 Here jobs are classified by categorizing them
into functional, product, geographic or
combination.
5) Developing an organization
chart
 The format of the retail organization should be
designed in a coordinated and integrated way.
 With these things in mind , a retailer devises an
organization chart which graphically displays
the hierarchal relationships.
 Organisation Structure for Small Stores

Owner/Manager
Responsibilities:
Buying, Promotion, Sales,
HR, Operational

Back Office Staff

Sales Staff
Responsibilities
Responsibilities
External Advisors Lawyers, Accounting & Record
CAs, Bankers, etc. Customer service, selling,
keeping, data entry,
stock contro, display and
inventory control, purchase
housekeeping
orders, time keeping, etc.
 Tasks to be performed in a Retail Orgn

Managem
ent

Branding,
Buying & Store Administr Finance Marketing
Merchand Operation ation & HRM & ,
ising s Legal Accounts Advertisin
g & PR
 The Human resource
environment of Retailing
 The Retailers face a special human resource
environment characterized by a-
- large number of inexperienced workers,
- long working hours,
- highly visible employees and
- variability in the customer demand.

 These factors make the hiring , staffing, and

supervision of the employees a complex
process.
 Contd..
 Because of all these difficulties, the retailers
should consider points such as –
1) Recruitment and selection procedure must
generate sufficient number of applicants.
2) The training programs must be short and
should focus on developing the skills of
employees.
3) Compensation must be perceived by the
employees as “FAIR.”
 Contd..
4) Employee appearance and work habits
must be explained.

5) Full and part time workers should not

have any conflicts.
Human resource management
process in Retailing
 Contd..
 Recruitment is the process of searching
the candidates for employment and
stimulating them to apply for jobs in the
organization.
 The purpose on Recruitment process is to
make the job applicants available for the
specific jobs.
 Sources of Recruitment
External sources
1) Educational Institutions
2) Competition
3) Advertisements
4) Employment agency
5) Unsolicited applicants
Internal Sources
1) Current and former employees
2) Employee recommendations
 2. Selection
 Selection involves the series of steps by
which the candidates are screened for
choosing the most suitable persons for
vacant posts.

 The basic purpose of selection process is

to choose the right candidate to fill the
various positions in the organization.
 Process of Selection
 The application blank
 Interview
 Testing
 Reference check
 Physical exam
 Job offer
 3. Training
 Training is an important aspect of human
resource management. Typically , in retail,
training is needed at the following times-

- At the time of induction

- At regular intervals to sales staff for skill
enhancement.
 Contd..
 Training to the retail sales staff is very
important because they are the face of the
organization. Training is given to improve
their communication skills, product
knowledge, company policies on Returns,
Market awareness etc.
 4. Compensation
 Methods of compensation
1) Straight salary Method
Advantages - Employee security, Known
expenses
Disadvantages - Less Motivation
2) Straight commission method
Advantage - High Motivation
Disadvantages - The risk of low earnings
 Contd..
3) Salary plus commission
It means to combine the attributes of both
salary and commission plans. The
employee gets a fixed salary and a
commission on achievements of the
targets.
 5. Supervision
 Supervision is the manner of providing a job
environment that encourages the employee
accomplishment. The goals are to oversee
personnel, achieve good performance, maintain
employee morale and motivation, control
expenses, and communicate policies.
 Proper supervision is needed to sustain a
superior performance of the employees.
Supervision is provided by personal contact,
meetings and reports.
 3 basic styles of supervision

1) Management assumes that the employees

must be closely supervised and controlled.

2) Management believes that the employees can

be self managers and assigned authority.

3) Management applies a self management

approach and also advocates more employee
involvement in decision making.
 6. Motivation
 In retailing, Motivation is very important
because of the long working hours and the
immense pressure on performance.
 The research on human behaviour has shown
that most of the people at work are motivated
by the following factors-
- The organization culture
- The rewards
- The monetary benefits
- Growth and job enrichment
 7. Performance Evaluation
 The basis of the performance evaluation is
the goals and targets that have been set
for each individual.
 Through targets, the outstanding as well
as the poor performances can be easily
identified.
 8. Building Employee
commitment
 The workplace is changing dramatically and
demands for the highest quality of product and
service is increasing. To remain competitive in
the face of these pressures, employee
commitment is crucial. This reality is applicable
to all organizations but is of particular
importance to small and medium sized
businesses
 9. Employee Retention
 Employee Retention involves taking
measures to encourage employees to
remain in the organization for the
maximum period of time.
 Role of Human Resource Management in Retail:
a Menu of Practices
Area of Practice Some Choices Available
Compensation Lead, Match or lag the market, Basis of
raises, long term tenure rewarded? Large
differentials b/w employees

Training Who?, how much?, what sorts of training?

Staffing How many?, mix of full or part time?,
contingent employees needed?,
employment security?

Hiring and Selection Criteria for new hires, promote from

within?

Workplace Governance Employees involvement in decisions, formal

voice in decision making

Work Organization Jobs narrowly or broadly defined, flat or

steep hierarchy, workers organise in
teams?
 Conclusion
 In retail, as in any other business, defining the
organisation structure is the starting point for
managing a business.
 Define the organisation structure that enables
the activities and tasks to be performed.
 This will help to human resources function in
recruiting the right people for the right job and
define the responsibilities, authority of positions
and reporting relationships that are necessary
for smooth functioning of the organisation
 References
 Pradhan, Swapna., (2007). Retailing
Management, New Delhi: Tata McGraw-
Hill.
 Internet sources.
Thank You!