H&M in Romania

H&M Internationalization
Catalinescu Cristina C p în Bogdan C pîlnean Sergiu Gama Cristina cerban Alexandra Toader Alexandra

958 5/10/2011

At the very beginning. new brand Hennes and Mauritz.General Presentation According to the data published on the official website. Year Milestones 1947 opening the first shop "Hennes" in Vasteras. it was actually given the name Hennes (the Swedish word for ³hers´) because only women¶s clothes were sold there at that time. soon Erling Persson gave his company a new name Hennes & Mauritz (H&M in short) instead. we know that H&M was established in Vasteras. the men¶s clothes began to be sold in the stores. it expanded with a high speed. H&M kept expanding continuously. Just from then. Erling Persson bought Mauritz Widforss. Thus. Sweden 1964 opening the first shop in Norway 1967 opening the first shop in Denmark 1968 acquisition of MauritzWidforss. a hunting and gun store in Stockholm.Great Britain 1977 clothes for teenagers are added 1978 clothes for babies are added 1980 acquisition of Rowell's mail order company. men clothes are added 1972 Stefan Persson (son) joins the business 1974 the company goes public (Stockholm stock exchange) 1975 cosmetics are added 1976 entry the first non-Scandinavian market . The milestones in the company¶s development have been presented in the table below. Later in 1968. introduction of sales through catalogue 1987 Margareta van den Bosch joins the company as design director 1998 the company starts online sales in Sweden 1999 the company starts online sales in Denmark and Finland 2001 the company starts online sales in Norway . Especially after 1982. In the following years. when the first store was opened. Sweden in 1947 by Erling Persson.

Karl Lagerfeld. Its development is not only fast but also profitable . and to increase sales at the existing stores. However. complemented by online shopping and catalogues. and it financed new market entries with own cash reserves. such as Madonna. for which they collaborate with famous designers and celebrities.500 stores in 28 countries. . apart from the traditional shopping in stores. Operations through franchising are considered an exception from the expansion strategy of the H&M and were chosen because in the Middle East it is not possible to operate wholly-owned subsidiaries. Nowadays H&M has around 87. H&M has begun to sell its products through catalogues and the Internet. Although better known for their focus on providing people with good fashion for affordable prices and although positioned as a brand for the low to middle income categories. which provides more convenience to customers. H&M aims at increasing the number of stores by 10-15% a year. Among them.during the last five years sales including VAT has increased by 73% and profit after tax by 139%. H&M offers a wide range of apparel from basic items to more high-end fashion products. and also cosmetics under its own brand. in September 2006 H&M began its expansion in Middle East in cooperation with franchise Alshaya. Qatar and United Arab Emirates respectively. Kuwait. Furthermore. In 2007 the company managed more then 1. nowadays H&M has extended its products to children and teenagers. Roberto Cavalli or Stella McCartney and their products are very popular among all income categories. In addition. most are in Europe and the left ones are in China. H&M expanded through organic growth.500 stores in 28 countries.At present.000 employees all over the world and also has become one of the largest clothing retailers in the world. The most important distribution channel are own stores. Canada and the United States. H&M has already owned more than 1.

college fashion. travel. It just cooperates with around 700 independent suppliers in primarily Asia and Europe. II Planning 1. and events. H&M pays much attention on the control of quality and also tries to make its products have minimal impact on the environment and to control good working conditions in suppliers¶ factories. it has its own design and buying department that creates the collections. buying in large volumes. Although there are two main collections every year . to begin with. that is. values. and films and keep eye on television and Internet´. pattern makers. but also Americans and Africans." 2. street fashion. ³to provide people fashion and quality at the best price´ (Facts about H&M. H&M always sticks to its own business concept. As for the good product quality. being cost-conscious at every stage. it is just achieved by ³having few middlemen. Their common goal is to produce garments according to consumer demands. lines of action As a successful company. visit exhibitions. H&M¶s main designer. buying the right products from the right market. average aged 30. buyers. Kids. the company slots its customers into two distinct categories ± practical consumers and fashionable and trendy consumers and caters to requirements of each group separately.the spring and the autumn one. Mission statement: "Fashion and quality at the best price. H&M does not have its own factories. H&M release many sub-collections in every season. assistants and controllers. For the fashion. as well. having a broad. coming mostly from different European Cuntries. like Women. H&M has chosen to expand in Romania. women. 2007). and having efficient distribution´. They are required to ³constantly observe the trends in the fashion industry. Every concept. H&M stocks its stores with clothes of distinct categories so that not one member of either group return . fashion and textiles. encounter different cultures. Men. Premises. teenagers.As a part of this expansion strategy. Margareta van den Bosch. Divided and Denim has its own team of designers. it becomes a matter of sartorial elegance in case of the latter. Keeping this basic difference of these two groups in mind. Moreover. so that each week customers can find something new in the H&M stores. supervises a team of many different designers. H&M has reached its iconic status by targeting each member of the consumer group by primarily dividing them into convenient groupings as men. While clothing never exceeds basic physical requirement for the former group. About the best price. in-depth knowledge of design. flea markets. through a wholly owned subsidiary which will operate 2 stores in 2 large Bucharest Malls. children and future mothers and has exclusive offerings to satisfy each group. Thus.

Pull&Bear) Presence of supplier here. 4. Strategic goal: internationalizing operations in an area which already has a supplier and high-potential human resources and which will represent a market that can absorb the company¶s products. Strategic planning ±SWOT Analysis Strengths Weaknesses Fast fashion retailing The appeal for H&M products Increasing inventory turnover time Economies of scale Global reputation already formed Universally likeable designs Effective communication Innovation Market share leadership Strong brand equity Strong financial position Supply chain Ubiquitous ± Ätoo³ popular Scale makes control difficult May be perceived as Ätoo cheap³ ± ÄMcFashion³ Opportunities Threats Romania . 3. H&M pursues a policy of uniqueness and differentiation from its competitors and manages to create a unique position for itself in the minds of consumers.low transport and RON-EURO exchange rate ( they will have to supplying costs lower some prices due to imperfect psychological . Thus. Bershka.Emerging economy suitable to Unemployment support H&M¶s expansion plans economic and the aftermath to of the crisis continue pressurize H&M well positioned to tap the niche organic discretionary spending apparel market Weak competitive position as the Its reputation precedes itself in Romania ± some prominence of value retailers and premium consumers used to travel to near-by countries luxury brands increases with H&M stores simply for their products ± high Big competition in the form of Inditex brands demand (Zara.unsatisfied.

which makes this market ideal for cutting supply and logistics costs.Ease and accessibility of EU regulations convertibility) Bureaucracy 5. the best strategy to pursue from Porter¶s generic strategies would be the product differentiation one. Strategy at the product level Porter¶s Generic Strategies: Differentiation Strategy (world famous design-focused products at best quality/price ratio) Seeing as the lower income level of Romanians.1. H&M will also take advantage of the pre-existing supplier in Romania. 5. Strategy The pursued strategy will be a maxi-maxi one: H&M will use its already established global reputation (S) to capitalize on the high demand and high interest already existent in Romania for H&M products (O). makes it so that H&M products are not perceived as very low cost and affordable. Strategy at the company level Ansoff Matrix Market development: the firm wishes to pursue a growth strategy where the business seeks to sell its existing apparel products into a new geographical market. as compared to other EU countries. thus satisfying a documented. 5. As a secondary opportunity which will benefit the firm.2. Thus. existing demand (demonstrated by the example of Romanian ³H&M tourists´). H&M will have to set its products apart as being the worldwide renowned fashionable designs which are offering the best quality -price ratio on the market. . Romania. where H&M will capitalize on its status as an icon in the world of apparel before coming to Romania. the product differentiation itself will be aided by the image differentiation aspect. by establishing here a wholly owned subsidiary.

based on conveying the message of a fashion industry hallmark brand offering the best level of the quality . There people employed in the logistics department in H&M will be organized under a head of department who will report directly to the headquarters in Stockholm. and then as a retailer and the process is managed centrally from Stockholm. as it acts as an importer and wholesaler.price ratio e. 6. Immediately upon . in every country of its operations. Department of Sales ± ensuring recovery of Romanian investment within 18 months c.3. the transport will be by auto carrier from the main warehouse. its almost continually search for market opportunities and its eagerness to regularly experiment with potential responses to emerging environmental trends. Tactical planning A. them as per the stores and controls the quality. Department of Buying&Logistics H&M controls all the stages of the logistics. Thus. Since. Department of Finance ± ensuring a continuous flow of financial resources that will allow start-up and maintenance of operations. The Logistics department will also handle appropriate product packaging. or to a call-off warehouse that hold the stock and distribute later products according to demand reported by stores. H&M builds a distribution center that receives goods. The distribution center will be built when sales volumes in the market reaches economy of scale and when the quantity of stores reaches some ³critical mass´. Distribution centers either send items to the stores. For transport. it has the potential to create the change and uncertainty to which their competitors must respond. Department of Logistics ± bringing in H&M quality products by using available and affordable resources (supplier and distribution channels) b. and. in keeping with H&M values and image 7. by expanding into the Romanian marketing. It will be the only company providing cutting edge design and fashion at affordable rates and with a fast collection turnover to the middle and upper-middle income categories in Romania. Department of Human Resources ± putting together a competent and effective team.5. seeing as the goods will be produced in Romania. Tactical goals a. labelling and all that those entail. Miles and Snow framework: Prospecting strategy H&M is proving. monitoring this flow d. H&M will use external contract companies. Department of Marketing ± developing a promotion strategy for the Romanian market.

tending to the arranging. B. human: transportation sub-contractors. They will each have completed the necessary 3 week training program. Department of Finance In order to achieve the projected goals.Accounting department will begin by performing an analysis of the selected financing method ± own equity ± and how it is to be used specifically within the next time intervals. Resources needed: human: finance/accounting employees. financial: money for expenses above and for wages D. H&M is targetting to recover its initial investment in setting up a Romanian subsidiary. storage building for distribution center. in order to avoid high initial costs. logistics employees and head. financial: budget for covering all the above mentioned. labels. physical: cash registers. the company will use distribution centers located in the neighbouring countries. They will work in turns.entering the Romanian market and for the short-run. Resources needed: physical: clothes as manufactured by supplier. The whole department will have employees both as sales associates engaged in direct sales and as supervisors. printers etc. the Marketing Department will organize and control promotional activities. the Finance. 3 employees will handle the cash registers. Department of Marketing In its intent of positioning and differentiating H&M as the best fashion value for money provider. The Department will oversee the level of acquisition and distribution costs and will evaluate the investment recovery process in the first 2 years. Resources needed: human: sales employees. reporting to 1 department head.). uniforms. packaging material (paper. The department will engage in research of customer perception of the image of competitor brands and of H&M itself. under the supervision of the department head. placing/replacing products and answering customer questions. selecting from the . desks and office equipment. shelving &arrangements. with no less than 5 employees per store at any one time. boxes. Department of Sales Within 18 months from market entry. financial: money to cover all the mentioned expenses C. computers. physical: computer software.

On the other hand. financial: budget for these . It is considered important to transfer and implement knowledge. billboards and ads as in other H&M countries. quality controllers. All new employees must participate in a three week long introduction course and are assigned a mentor. After the three weeks. and they have possibilities of promotion. people who work in offices are sent from time to time to stores in order to maintain contact with clients. The department will use the same simple advertisements campaigns. because they have knowledge about the local market and are considered important when deciding about the strategy.billboards and banners. to reduce costs. The overall marketing goal and vision of H&M for Romania will be the responsibility of a department head. human resources: translators. the Romanian HR department will have a head and 2 recruiting and control assistants. Resources needed: human: 8 experienced staff members. auditors. financial: budget for translations. Stores staff must carry out various duties such as cash desk. physical: plane&accomodation for them. training rooms and office equipment. etc.research the specific key elements that will help the company in its desired positioning. H&M will largely practice job rotation. Department of Human Resources An effective and competent team will be fully set within 6 months. skills and H&M culture in new locations. Resources needed: physical: translations. but will make sure to properly translate all promotional messages. marketing employees and head. posters. printed media ads in publications. employee wages and media coverage E. Stores personnel are recruited locally. displaying and customer assistance. Both recruitment and training will be initially carried out by experienced staff from other locations ± 6 in sales and 2 in managing. for instance for positions like production coordinators.

This standing plan will represent a policy y Advertising Office of the Marketing Department o Scope: to ensure a strong entry on the Romanian market and to create a powerful brand image in the local market as a newcomer with tradition o Planning: First of all. Operational Scope and Planning Operational plans are realized at operational units level and have a short term. The person responsible will be the manager of the Finance/Accounts Department y Ordering Office of the Buying & Logistics Department o Scope: To ensure that up-to-date collections and products are available o Planning: This activity requires the buying office of the Romanian branch to keep track of current trends in international fashion and in local fashion trends in order to seek approval from the central office in Sweden and in order to best request from the production department the necessary products and collections which would maximize sales in Romania. contacting advertising . the program for supporting the entry will begin before the actual store opening and will require studying the local market. as H&M operates on a bi-annual collection. The person responsible will be the manager of the Buying Department. but additional sub-collections can be required all year round. Accounts will be kept and the same depreciation and amortization and the same method of bookkeeping will be kept for all accounts in order to ensure accordance to legislation and to internal requirements.8. as accounting information is required on a yearly basis. The usual time period is 6 months. and the plans can be unique or permanent y Accounts Office of the Financial/Accounting Department o Scope: To provide accurate evaluation of commercial operations and to analyze and apply the Romanian institutional accounting system o Planning: This type of activity requires a standard operating procedure as the activity is routine and required by national and European legislation. usually no longer than one year. The necessary time period is 1 year.

This will require bringing in training personnel from the home office. At first this will constitute a program of training all required managers and employees and after the initial opening. store them and then distribute them at the required store and at the required time. conducting workshops and training seminars and working with local training companies for a period of 3 weeks. time. . after selection. designing the actual campaign. The policy of creating a powerful brand image will require building upon the initial entry campaign and continuing to pursue innovative advertising through unusual channels. date. this will constitute a standard operating policy y Distribution office of the Buying&Logistics department o Scope: to ensure availability of products and collections at all times o Planning: the distributions office must keep in touch with the buying department and the sales department in order to keep track of required inventories in stores and to restock those inventories when needed. The standard operating procedure will require constant press releases regarding new store openings. new collections being added and other important information y Training Office of the HR Department o Scope: To train future H&M employees and managers in the corporate culture. number of employees. job openings and so on.agencies. work ethics and know-how o Planning: Besides the training done for the country manager. The distribution office will take over the inventories from the shipping office. which will be carried out in Sweden. y Press Office of the Marketing Department o Scope: To ensure constant communication with local press and media o Planning: The program before entry will be to ensure media coverage about the store openings and the employees will have to give out press releases with information on location. the training office will have to instruct and train the new employees on both managerial positions and on sales positions in order to be according to the H&M general guidelines. The plan will have the period of 2 weeks. choosing the appropriate media. whenever there are new recruitments. This procedure will represent a policy.

Organizational Structure . Organizing 1.III.

. Investor Relations. Justification of organizational Structure H&M has a matrix organization in which country managers and the members of the executive management team report directly to the Managing Director (see section on control environment). and the Group functions/central departments for which the executive management team is responsible. which facilitates internal control and comparisons between the various companies. which means that those on the executive management team are responsible for performance within their function in each country (the vertical arrows). All the companies within the H&M Group have the same structure and accounting system with the same chart of accounts. headed by the country managers. This simplifies the creation of appropriate routines and control systems. Matrix management further requires a workforce that has a diverse set of skills and employees that have strong interpersonal abilities. Human Resources. The country organization is in turn divided into regions. The country managers are responsible for profitability in their country and thereby have overall responsibility for all the functions within their operations (the horizontal arrows). The matrix organization consists of the sales countries. Expansion. Security and Corporate Social Responsibility. Production. with a number of stores in each region. Each central department regularly reviews its guidelines and manuals to see which ones need updating and whether new guidelines need to be developed. There are detailed instructions for the store staff that control daily work in the stores. This team consists of the Managing Director himself and eleven other individuals. H&M¶s Managing Director is responsible for the day-to-day operations. In general. Accounts. The executive management team is responsible for the following functions: Finance.2. H&M has a matrix organization. Many other guidelines and manuals are also available within the Group. The Managing Director has appointed a team of senior executives with ongoing responsibility for the various parts of the business. Buying. Communications. The organizational structure of the company simply adds another level following internationalization in the Romanian Market. matrix structures are assumed to be most appropriate for larger corporations that operate in unique or fast-paced environments. Marketing. In most cases these are drawn up in the central departments at the head office in Stockholm and then communicated to the respective department in the country offices.

Because people from different departments are cooperating so closely.The cardinal advantage of a matrix structure is that it facilitates rapid response to change in two or more environments. More adept management is the result of top decision makers becoming more i volved in. in charge of performance of all functions within his/her operation. product ideas. data is channeled both vertically and horizontally as people exchange technical knowledge. This involvement can also lead to improved long-term planning. matrix organization may result in a more efficient use of resources than other organic structures. they are more likely to experience higher levels of motivation and commitment to the goals of the departments to which they belong. In addition to speed and flexibility. In effect. they are eager to share data that will help them achieve common goals. Departmentalization The Romanian branch of H&M will have a total number of 140 employees. which is to be departmentalized as following: y Finance/Accounts: o o o 1 department manager 6 employees for the Financial Office 3 employees for the Accounts Office y Sales o o o o 1 department manager 2 store managers 5 assistant store managers 35 sales assistants y Buying o 1 department manager . Other benefits of matrix management include improved motivation and more adept managers. the day-to-day operations of the company. financial information to make decisions. Improved motivation results from decision -making within groups becoming more democratic and participatory because each member brings specialized knowledge to the table ² and since employees have a direct impact on day-to-day decisions. Matrix structures are flatter and more responsive than other types of structures because they permit more efficient exchanges of information. the entire organization becomes an information web. 3. marketing data. as follows: 1 Country Manager. and thus n better informed about.

employees committed to their work and prepared to take on new challenges. recruitment. focusing its entire activity around the fundamen tal respect for the individual. compensation and motivation of its employees. facilitating rewards schemes aligned with organizational culture. selection. freedom of association to promotion opportunities. evaluation. Therefore. encourages what it calls the ³The H&M spirit´. hard work and team spirit are encouraged. H&M has an open door policy granting all employees the right and the opportunity to discuss any work-related issue directly with the management. facilitating expatriation of experienced staff when new stores are opened. When a company expands and develops its activity at an increasing rate in host countries. The objective of H&M is to be a good employer. Recruitment needs to focus on finding candidates with the Äright fit´ to the organizational culture. from equitable salaries. work schedules. Concerning work relations. enabling human . Coordinating (human resources policy) Human resources policies of a company describe the process of selection. training and motivation policies should be in correspondence with the characteristics of the country where the company has expanded its activity. The company. it has to adopt a multicultural policy which should be reflected in the relationship with the employees. This characteristic can be found in every aspect. H&M is registering increasing demands as an employer.o o y 3 employees for Ordering Office 3 employees for Logistics Office Marketing o o o o o 1 department manager 4 employees for Marketing Office 4 employees for Advertising Office 3 employees for Communications Office 2 employees for Press Office y HR o o o o 1 department manager 5 employees for Recruitment and Selection Office 5 employees for Training Office 6 employees for Salary Office Part IV. The company also supports the employees' right and ability to organise and to decide who should represent them in the workplace. common sense. through a participative culture. training.

individuals are expected to drive their own development. the management system of the new company should also suffer a few alterations in order to fulfill the requirements of the new market. ³Advancement´. another country. another role or. within the framework that the organization provides. The company looks for. but personality and attitude cannot be taught. training and motivation. Consequently.resources development schemes that can empower employees to take on new challenges and work in new teams. resonate with Herzberg¶s 2 factor model of motivation. . fair treatment etc. H&M values personal qualities much more than formal qualifications. the personnel policy regarding the general manager. the company H&M should adapt to the local business environment and take into consideration local customers needs and their mentality. General Manager Entering the Romanian market as a subsidiary. ³responsibility´ and ³satisfaction gained from the work itself´ are main motivators. in another department. At H&M. Individual development and organizational development are treated as tightly linked areas. According to this. The main motivational issue and challenge at H&M is nurturing and maintaining a balanced relationship with employees. which is aligned with its own development and growth strategies. In the internationalization process. selection. H&M encourages employees to try many different roles within their organization. The organization facilitates and promotes cross-functional and crossboundary development opportunities for individuals. the head of department and the operational worker includes the four following stages: recruitment. more than anything. the new general manager should be familiarized with the characteristics of the host country¶s market and culture. H&M¶s HR strategies and policies. H&M as an organization is constantly evolving and is growing fast. prevent dissatisfaction. while benefits. people with the right personality. thus providing more opportunities to its employees. The belief is that people can gather skills as they go along. 1. Employees are motivated by providing new challenges. which will be customized for the Romanian market.

which is directly oriented towards gaining of a strong position on the Romanian market.the job description. suggestions coming from the company¶s employees should be free of any subjective connotation in order to be taken into account with respect to the position of general manager. Recruiting from university campuses is not an optimal solution mainly because students do not have enough experience for the general manager position. In choosing the general manager for the Romanian subsidiary.The adaptation of the human resources policy constitutes a vital objective for H&M management. .the salary. on the intranet platform where all employees have access to and any visual display that can be easily observed by the employees. taking into consideration the following criteria: . Selection The selection process of the international manager will be based on assessing the qualifications and evaluating his personal qualities. the company has chosen hiring people from inside the company.future employees¶ motivation for choosing this job. who will supervise the internationalization process of the company and will be directly responsible for the trainin of the g future local general manager. b. .specific standards regarding the vacancy. The job announcement is posted in several places like central spots which are frequently used by all employees. On the other hand. This job announcement should contain detailed information about the job in order to avoid the applications for the general manager position belonging to people that do not fulfill the required qualifications. Recruitment As the recruitment method for the general manager position (country manager).necessary qualifications and professional background. H&M will use a combined method: it requires firstly a manager belonging to the culture of the company.the time period when the application can be submitted. a. This job announcement will contain the following information: . even though they might have sufficient theoretical knowledge. . . .

international experience ± very important for an expatriate general manager.technical and managerial skills.personal motivation and desire to obtain the job . the following questions: . . negotiation skills are crucial when dealing with people from other countries and cultures.language skills .Which is the greatest success of your career so far? . strengths and weaknesses. among others. . but in the same time he should accept and understand the cultural differences. preferably having occupied a similar position in a more developed country.family adaptability . . . . the company will organize an interview. after the assessment of previous performance and specific practical tests. The selection process will focus on choosing a manager from a third country. who should be able to transmit the values of his company throughout the world.social skills . needs. thus being able to adapt to the conditions of the emerging market and perform well.usually the understanding of more foreign languages creates a competitive advantage for the potential employee and smoothens the communication process (at least two foregn languages of international circulation.. . motivations. which will comprise.the manager should be able to recognize its own values.diplomatic skills .What is your motivation for applying to this job? . . also being adequate for achieving the goal of transmitting the values of the company.foreign affair contacts are very important for a general manager¶s career. Also.a good manager should be able to interact with people from other cultures.Are you aware of the opportunities and risks of a job in a foreign country? .Do you consider you have the ability to learn quickly and efficient new foreign languages? .this feature influences the performance of the manager when occupying an international position or when he needs to be relocated. Selection methods As the most suitable selection method to evaluate the compatibility of the candidate with the position requirements.the future manager should be highly motivated to obtain this position. which are mandatory for a good manager and they usually consist of past performances of the manager.encompasses the theoretical knowledge of the manager. at a proficient level). .academic studies .maturity and emotional stability .

How many kids do you have and what ages are they? Are they willing to live in another country? . some adaptation problems may occur: critical situations. Critical situations should be considered or viewd as positive opportunities or challenges that the manager should overcome successfully. In his Pyramid Of Needs. When taking into account the host-country. In the first stage of the training process. Training The assumption has been made that the manager has all the necessary technical knowledge. The process of training is be based on two separate phases: the first one containing a training for adaptation before leaving and the second one regarding adaptation in the foreign country. the two key-factors which which the company is considering are: concerning the individual concerning the company Both the manager and his family should attend intercultural workshops in order to familiarize themselves with some basic general information about the new country. which will facilitate the adaptation process. d. Maslow identified 5 different human needs according to their importance: . so the focus will be onthe cultural training.Do you have any medical problems? How about your family members? . The company is highly oriented towards cultural values assimilation.What is your family¶s opinion regarding relocation? c. cultural differences or even cultural shock and difficulties in socialization and communication. Courses regarding the foreign language should be also provided to them. Motivation Employees¶ motivation is essential inside one company and it constitutes the leading force of the company¶s growth.. Motivational theories are split in two different categories: the first one that focuses on motivational factors and the second one that describes the motivation¶s mechanism.

The H&M company decided to use this method because it clearly presents the human needs and their evolution in time. . because their whole activity will be shaped around the necessity to have a thorough knowledge of the Romanian market characteristics. The first two needs being obtained. In the case of the general manager. The social needs are accomplished through the social integration of the manager in the new country. mobile phone. The safety need is satisfied through the general manager position. laptop. automatically appears the need for the superior level.This pyramid illustrates the human needs in a hierarchical way. the basic and the safety needs are satisfied taking into account that his relocation will suppose the following: a house for him and his family. the managers feel the need for individual recognition. personal automobile. meaning that once a level of needs is satisfied. which is also obtained through the general manager position. a top salary and the assurance that the children can continue their studies in the foreign country. H&M ensures this need by providing foreign language courses to the manager. Head of Marketing Department The Marketing Director will be selected from Romanian potential candidates. 2.

and also to im prove the cooperation and communication with the general manager. b. implementation and evaluation of marketing programs and campaigns to increase the market share. language skills. certificates. . personal qualities and abilities of the candidate. Minimum work experience of one year and a half in the field is necessary. based on an analysis of the CVs in an initial phase. knowledge of the Romanian market and previous experience in a multinational company if it is the case. Lack of experience or technical ability will eliminate the candidate from the start. in order to have a better understanding of the Swedish business behavior. results. the first being very important in order to test numerical. Thus. the company will benefit from a generous data base of valuable candidates. Recruitment The main option to recruit the head of the Marketing Department will be through recruitment web sites. will include an assessment of the following: studies. experience in a multinational company. as well as a good understanding of the company¶s vision and ability to put in practice the tactical plan of the department and to coordinate the operational planning. This person should display strong strategic and analytical thinking. The selection methods used are tests and interviews. but this action will be paralleled by advertising the position on the home page of the company and in the relevant press. sales. Training The head of department will be required to have a cross-cultural training. interview will finally test the compatibility between the candidate and the company and his motivation.a. future aspirations. it is expected that competitive potential candidates would be attracted by this position. revenues and brand awareness. creativity and ability to cope with strict deadlines in a rapidly changing environment. organizational skills. he will be asked to present his professional achievements. Selection The marketing director will be the person responsible with the design. The importance of knowing at least two foreign languages by the person occupying this position cannot be overestimated. The selection criteria. Considering the good reputation and the strong image of the company at an international level. During the interview. analytical and interpretative skills needed to fulfill the job¶s requirements The . c. performances.

depending on the specific job. depending on his performance. the department director will attend a professional course both in Romania. Having these needs satisfied. Attractive. Motivation For the motivational process. attractive salary. but realistic the description is intended to bring the most suitable and competent candidates for the job. d. and upload a CV. the head of department will be more oriented to the accomplishment of superior needs. recommendation letters and other necessary documents. Operational Worker Sales Advisor ³Fashion. ce Socialization needs can be fulfilled. Thus. and in Germany. comparing the results of the department with the ones at an international level. Recruitment The main recruitment method in this case is advertising the position under the job opening section of the company¶s recruitment section on the web page and other recruitment sites on the Internet. the head of the marketing department will have the opportunity to observe the activity of the corresponding department in an international subsidiary. through vacations paid for by the company. in order to improve his perspectives and share experiences. The recognition need can be considered satisfied by obtaining the current position in the first place and self-actualization needs can be covered through the attendance of courses offered by the company. personal laptop. motivation letter. Fun and Hard Work´ ± this is how the head of the job position description sounds like. for example. bonuses and other performan compensations. .Concerning the technical training. the best performing market of the company in Europe. where they can fill in the main general information about themselves that the company needs. physiological and safety needs will be covered by the company by offering the employee a mobile phone. Potential candidates can register and create an account on the web page. The candidates should display strong motivation and compatibility with the field they want to work in. 3. The main motivational factor can be represented by the salary increase accordin to g performance and efficiency. the Maslow pyramid can be applied to cover the needs. but in the context of the Romanian market characteristics. a. or two times a year. Every year.

having a good understanding of the job requirements and of the fashion area. to have a better understanding of the mission and vision of the company. Research into the company. physically demanding and fun work environment b. y y y If applying for a store job. to ensure that they understand and meet the requirements. working well in a team and being able to work in a fast paced retail environment. Be prepared for a fast-paced. Accessing the section "How H&M are you?" to test their compatibility with the company.The company provides a section under the name ³Before You Apply«´ on the recruitment page that the persons willing to submit their applications are advised to read before doing so. y y y Watching the career films provided on the web site to get a sense of everyday work at H&M. y Based on the skills and experience. in order to have an accurate image and to be able to contact the candidate. They should read the full job description of the role they are interested in before applying. information about collections and brochures to deepen their understanding of the firm¶s . Workers should receive catalogues. The selection methods used will include practical tests and an interview after the assessment of the on-line application. fashion catalogues. being good at multi tasking knowing . Being sure to update the application. how to prioritize. Training All workers will be provided training by the head of their department. y Always attach a CV and personal letter to give a full picture of the skills when applying for a job. the candidate may be asked to interview for a different position than the one targeted. c. Selection The criteria for selection will be a minimum experience in the field. consider the flexibility of retail hours. The main things that the candidates should take into account before applying are: y y They must be at least 16 years old to apply.

The Romanian general manger must present a report referring to all the achieved goals and the subsequent issues (a detailed presentation of the causes of their appearance and the solutions proposed for their development ± this may be useful for avoiding the emergence of the same type of problems at other H&M subsidiaries). the company will provide at first incentives for the individuals by offering them compensation which exceeds their expectations. Afterwards. A motivational theory that can be used is the expectations theor According to this y. Workers are given the sense that what they are doing is most important for the firm. . Every month. Controlling The control activity inside H&M refers to three main categories of performance ± financial. Motivation H&M provides more than just a job to its employees. that they are working in the place where the best ideas and future managers are born. it offers them the opportunity to grow and build a career. Also. d. which will be successful on the short run. Vouchers and discounts are given to workers as bonuses. quality and human resources ± for each of them being established the type of control ± preventive. The employees are motivated by the daily challenges they face and dynamic environment. they should attend one week training every three months to be able to successfully adapt to the rapidly changing environment they are working in. compensation will correspond to expectations. Therefore. Internal succession is given priority in the company as a motivational method for those who are eager to be promoted and perform better to achieve this. The direct control involves personal interaction between the CEO of the company and the managers of the subsidiaries. his efforts and the actual compensation. Part V. the company repays the best performing employee by granting him the ³Employee of the month´ title and a bonus to his salary.current activity and goals and also an employee¶s guide to provide them with a strong sense of responsibility and willingness to convey the values of the company to the customers. the level of motivation of the employee is related to his expectations regarding the compensation. in order to efficiently and permanently motivate them. or through business visits at every subsidiary. These meetings could take place at the headquarters of the parent company. theory. current or of verification ± and the type of control ± direct or indirect-. as sales advisors.

Given the smaller costs of this type of control. stocking and others. quality being the one that makes the difference on a market where the competition is fierce. These should comprise a detailed performance of those for a long period of time. This type of control will be realised in the planning stage and it is strongly dependent on a reliable informational system Financial performance: is measured mainly through the obtained profit (several factors should be taken into account such as the influence of inflation and the sources of the profit: the real profit registered through productivity increases or through management efficiency or obtained from funds transfers from a subsidiary in another country. The preventive control will have its main goal the avoidance of potential problems and coming up with solutions ahead the emergence of the issue. Three sets of reports should be sent: the first one made in accordance to the standards of the Romanian environment. distribution. it would be made more often. their technical characteristics and the methods of packaging. the second one according to the country of origin (Sweden). first after six months and the second one after one year of activity. once a year. In the first year of activity there will be two direct controls. despite which division they belong to or geographic region. Therefore. the one responsible for checking compliance with all H&M products. It will be a verification control taking into account that the measurements of financial performance are made after the activity has stopped. on a monthly basis. The controlling process will be direct by the international quality division. The company attempts to give the customers choices. the third set with the purpose of displaying n overall financial situation of the company at the global level. The control will be carried out indirectly by sending monthly reports to H&M headquarters each semester and. in order to make a comparison with the firms from the host country. H&M clothing store caters to the tastes of consumers across a wide range. It seems like variety is the keyword when talking about the products. products that appeal to their aesthetics (by offering clothes ranging from retro-vintage up to the latest . directly by being visited by the Financial Director of the H&M headquarter.The indirect control should be realized through the written reports of the subsidiaries to the headquarters. the quality performance will be supervised thro current control. throughout the entire product development cycle: starting from the checking the imported goods. followed in the next years of this type of control on an annually basis. in order to compare relative performances among subsidiaries from different countries. Quality performance: is probably the most important type of performance for a company.

working hours and freedom of association to the opportunity for growth and development within the company. Human resources performance: it will be checked directly before employment. H&M has an open door policy granting all employees the right and the opportunity to discuss any work-related issue directly with management. Employees development. The way the control will be realised will be a direct interview with the employees. with the Human Resources Director from Romania. to facilitate the comparison with other companies from Romania and one drafted according with the standards that H&M uses. H&M clothing store aims to offer and cater to consumers across a wide base and do not compromise on either quality or style. This portfolio will contain a report about the H&M company. and the manager will also draft a report with the financial situation of the company in RON to measure the profit share or looses. The focus of the company then is on delivering the quality style and design without compromising on their cost policy. the company develops global guide lines on diversity. there will be evaluations twice a year. The final goods that reach the H&M clothing store go through numerous quality and safety checks. drafted according to Romanian standards. To quote the Head of HR ³In order to meet people¶s expectations of H&M as an attractive employer. and as a consequence. current. equal rights and against discrimination´. H&M¶s corporate strategy is to expand on a continuing basis. They also support their employees¶ right and ability to . At H&M. The strategy is to recruit locally whenever a new store opens. Therefore making clothes affordable is a prime target. shrinking and dry rubbing to ensure they meet the quality standards. In this way it helps to save costs by eliminating the middleman in the process. employee strength also increases continuously. among others. twice a year. Health and Safety. This applies to every aspect from fair wages. the general manager has to send to the headquarter an evaluation portfolio which will show the situation of the Romanian subsidiery. to be easier to compare with subsidieries from other countries. Also. the human resources performance control will be done preventive and. during their activity in the company. for which H&M buys huge amounts of clothing material by approaching the suppliers directly. color fastnesses. who will present his reports in an annual meeting with the Human Resources Director from the H&M headquarters. H&M is also conscious of the environment impact caused during its manufacturing process and takes due measures to minimize the effects. HR activities are guided by a fundamental respect for the individual.trends of the season). So. The products are tested for wringing. Managing diversity. The company introduces new products in its stores everyday to keep the collections always new. when there will be established if the interviewed persons have or not the desired qualities for taking this position in the H&M company. The product lines offered are distinct and reflect a diverse range in designs. This also indicates that the company has specific policies for areas such as Equal opportunity. and after that. also.

These HR strategic initiatives in turn make significant contributions to the organizational goals of continuing growth and profitability. hands on and work place based training. and not through a promotions and job titles. The firm will provide structured opportunities for on -the-job. they need employees who are self-driven and capable of direct communication well. supports effective leadership and provides adequate growth opportunity for employees. H&M values personal qualities much more than formal qualifications. company sick pay. .organize and to decide who should represent them in the workplace. private health care & a pension scheme. which includes staff discounts. H&M focuses on rewarding people by providing more opp ortunities and responsibilities. H&M has positive experience of open and constructive dialogue with the trade unions and they welcome such relations wherever they operate. The company offers a comprehensive benefits package. They consider such cooperation to be essential if they are to improve. Since H&M is a fast company and the tempo is always high. incentive bonuses. The prevailing organizational culture at H&M encourages team work.

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