Retail Organization

and Human Resource

Management

Uu

Dana Superior human resource management in retalling not only reguires that a firm
hire andi
jectives traim good employees but the firen mustalka keep them meotivated. With the
high employee
turnover rate in retailing, this is not an easy task. One estimate is that the cost
of replacing

bts taN 2 810 per hour retail employee averages more than 83,300. Since the
turnover rate among
in setting up a retail some retailers can easily exceed 70 percent per year, costs
related to employee turnover can
arganizatlon amdunt to. very lange expenditure,
£ To ori ibe Strategies a retailer can use to reduce turnover among low-wage
employees include:
various organizational » Fromote from within, This rewards long-time employees In
additica, it lets short-term
arrangements utilized in employees directly observe role models who have advanced
to managerial pasitions.
retailing » Be understanding. Grant excephons to odcasional lateness or absenteeism
if there 15 good
31 Ta oonebdar ia cause (sickness, family crisis, etc.

ia momen - » Make the jab relevant fo company goa. Show employees the value of
short waiting
sawi tofretsiling lines, clcan facilities, and customerserice-contrit employoes.
4. Yo describe the
Principles and practices
Involwed with the human
resource management

process In retailing

Senen 5 johrShutentodi
Reprimiod by permiason.

292
FIGURE 11-1

Selected Factors
That Must Be
Considered in
Planning and
Assessing a Retail
Organization

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CHAPTER 11 » RETAIL ORGANIZATION AND HUMAN HESOURCE MANAGEMENT — 293

« Minimize baredom by rotating jobs. Stockroom persons could work the cash
registers at
busy times or assist elderly or infirm customers with their packages.

» Invest in training. Make sure the trainer respectfully instructs and corrects the
new
employee.

Overview

Managing a retail business comprises Ihree steps: selling up an organization

structure, hiring
and munaging personnel, and managing operations—financially and nonfinancially, The
first
two steps of ihis procedure ane covered in this chapter, Chapters I2 and 13 deal
with aperatians
manngemeni.

SETTING UP A RETAIL ORGANIZATION

Through a retail orgambeation, a firm stroctures and assigns tasks (function).

policics, resources,
authority, responsibilities, and rewards to efficienily and ciTeetively satisry the
neals af iis wrgct
market, cmployees, and management. Fizure 1-1 shows various needs that should be
taken into
necoum when planning and assessing an organization's strclure,

Asa rule, a fin cannod survive munless 1s organization structure satisfies the
target market,
10 maticr haw well employee and management needs are met. A structure that reduces
costs

MANAGEMENT MEEDS

In ir relasisely easy to obealn and retain competent pertannek!

Are personnel procedures dlearty defined?

Does each worker report to only one supervisor?

Can cach manager property supervise all the worker reporting to hlm er her!
Co operating deparoments have adeguata staff support (ep, marketing research)!

Is cbong a system co replace personnel In ar orderiy manmert

Is "sene enough Mescibilicy to adapt co changes In cuntomer &r the environment!
234 PART 5 « MANAGING A RETAIL #USINES$S

FIGURE 11-2

The Process of
Organizing a Retail
Firm

Sysonis awholsaler

servitkg 424 restauranis,

hotels, sehools, and oiber

locales. Koes theimn a
wide range Of suppori
serioes Iwa syson com
Dus omer-solutikma.bamh.

via centralized buying but Icads toa firm's insensitivity to geographic difference
in custorer
preferences will lose market share. Alihough many retailers perform similar tusks
(buying, pric-
ing, displaying. and wrapping merchandise), ihcre are many ways of organizing to
comduci these
Tunetions. The process Of setting up a retail onganisutom, show In Figure | 1-2, is
deseribed next.

Specifying Tasks to Be Performed

The tasks ina distribution channel nvust be cnumerated and then keyed to ihe chosen
sarategy mis,
for effective netailing to oceur:

Buying merchandise on behalf af ie retailer

Shipping merchandise to the retailer

Receiving merchandise and checking Incoming shipments

Seming prices and mwrking merehundise

Inventory storage and control

Preparing merchandise and window displays

Facilitics maimenance (te... kecping the store cican)

Customer rescareh and cxehanging information

Customer contact (ee. Web site, personal selling)

Facilitating shopping (c.g.. comvenbeni location, shori checkout lines)

Custemer follow-up ana complaint handling

Personel manigemeni

Kepairs and alteration of merchandise

Billing customers and credit operations

Handling recerpts and fioanciil records

Gift wrapping

Delivery to customers (cg. muliechannel or omaichannel retualing)

Retuming unsold or damaged merchandise to vendors

Sales forecasting and budeeting

Coordinator

Dividing Tasks among Channel Members and Customers

Mthough the preceding tasks are typically performed in a distribution channel, they
do not all
have to be done by a netoiler, Some can be completed by the manufacturer,
wholesaler, specialist,
Or consumer. Figure (1-3 shows the types of activities that could be canied out by
cach party.
Following are some criteria to consider in allocating the funetions related to
consumer credit,

£ A task should be done by ihe person who: is most competent, and it should be
camricil out only
ai desired by the target market.

» Forsome retailers, liberal credit policies may provide significant advuntagcs

over compelitors.
For others, di cash-only policy may reduce their overhead and lead to lower prices,

«Credit collection may reguine a begal stuff and detailed digitixed reconds—mosi
afMordable by
medium or large metailers. Smaller retailers ane likely to rely on bank cnedit
cards,

| MG DG, MG NG, IG DG NG. D5, MG DG. NG DG. 2G, NG DG, MG. 00 20 R3 |

FIGURE 11-3
The Division
of Tasks ina
Distribution
Channel

This site (una

Ahebalanse.comfretsil-job-
scaneh-407ARSI ) Inghhlighas

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CHAPTER 11 » RETAIL ORGANIZATION AND HUMAN RESGURCE MANAGEMENT 295

Performer Tasha

» There Isa less of control when an acuvity is delegated. A credit collection

agency. pressing
for pasa-duc payments, may antagonis customers.

» Thengallers Institutional framework can alfect task allocaton, Franchisees are

neadily able
to get bogeiher to have thcir own private-label brands. Independents cannot da this
as casily,

» Task allocanon depends on the savings gained by shwaring or shifting tasks. The
credit Tunetion
is better performed by an outside credit buncaw if it has cxpert personnel and
ongoing access
10 financial data, aes tailored computer software, pays lower reni (abu tocam out-
of-Ihe-way
site), and so on. Many retilers cannot attuin these sovings themselves.

Grouping Tasks into Jobs

After the retailer decides whuch tasks to perform, they are grouped into jobs, The
jobs musi be
elearly structuncel. Here are examples of groaping tasks into jobs:

the range of jobs avai

in retailing.

Tasks Jos

Displaying mereharilise, customer coniset gift wrpping, Sales personnel

customer followsup

Emering uansaction data, handling cash and credit purchases. Cashier)

BIN wrapping

Keceiving merchandise, checking incoming shipments, Inventory personncl

marking menchandise, inwenory sorage and control,
returning merchandise to vendor

Wimbow dressing. inenor display setups, use of mobals Display personnel

disptaya

Billbng customers, credit operations, customer nescareh Credit personnel

Merchandise repalrs anal alierdions, resalution of compdainis, Customer service
cusloner rescanedi personnci

Cleaning store, replacing oli features Janitosial personnel

Employee managemena. sales foreeasling, budpeting. pricing, Management personnel

coordinading taka

Wale grouping tasks into jobs, specialkeation should be considered 30 cach employee
is
respansible for a limited range of functions (as opposed to performing muny diverse
tasks). Spe-
clalisaion has the advwanages of clearly defined tasks, grealer expertise, reduoed
training, and
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236 PART 5 « MANAGING A RETAIL #USINESS

fccording to the UK Office of Matlonal Statistics, Ihis number

of UK workerson zaro-hour contracts Increased by 20 percemt
In 2016 10 just over H00,000. This repsesents nearly 3 per-
cent of the employed UK workfosca, The zero-hour contract
WiMkers are not offered guaranteed hours or sick pay. Retail-
ers.are amongst those rnost fikely to offer their employets

PEPEEEEEN zerostow Contra |

them would like to work longer and more predictable hours

if ihay were given the option. The British Retail Consortium
claims that zero-hours contracis are not widely used In the
retail sector but that certain chains andi brands only use this
form of employment.

Why might netailsr Ope for zero-hour controcts? What

zero-hour coniracts. On average, ihe retailer worker work adwantages does it offer
ihem?
for ardund 25 hours per week, Howover, over 30 percent af 3 2 4m

hiring people with narrow education and experience, Problems can result due to
cxtneme special-
(aon: poor marale (boredom ), people not being aware of their jobs" importueee, and
the need
Tor mere cmployces. Specialieation rncans assigning explicit duties to-individuals
so a jab position
cngompasses a homogeneous cluster oi tasks,

Omwe tasks are grouped, job deseriptions are constructed. These outline the job
titles, objee-
tives, dutics. and responsibilitics for every position, They ane used asa hiring,
supervision, and
evaluation tool. Figure 1 1-4 contains a job description for a store manager.

Classifying Jobs
Jobs are ihen broady grouped into funetional, product, geographie, os combination
elissilications.
Fanerional clasafficarton divides jobs by task—such us sales promotion, buying, Web
design, and
stere operations, Expert knowledge is used, Pendluer clessiffeattan divides jobs on
pede or ser
vice basis. A depariment store hines different personnel for clodhing, furniture,
appliances, and s0
fomih, This classifwation recognlzes diferenees in personnel reguirements for
difTerent products,
Geograpiiic classificarion is useful for chains operating in different areas.
Employees are
acdoptesl 40 Local conditions, are Ucy are superwised by berunehi managers, Same
Sirms, especially
larger ones, use a combinatian clasditeation. Na berueeh unit of chain hires its
selling staff, but
buying persomnel for cach product Ting are hired by hesclayuarters, Ihe Tunetional,
product, sd
gcogruphic formats are combined.
Developing an Organization Chart

The format oa retail organization musi be designed In an Integrned, coondinated

say. Planning
Ieaders in ihe organization meed to clearly articulate accountability and decision-
muking author
iiy for cagh positkor ar role on the organcsamonal chart, spam of como (momber of
subordinates

FIGURE 11-4

A Job Description
for a Store Manager
CHAPTER AT » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT 297

under a manager's direct control) for cach position, and lateral elutionships
between pasitions,
Aligning indiidual employee goals with organizational goals and comovunicaling to
cmployces
bow the organizutionul structure will meet strategic objectives md gouls and create
sustained
gemwimic value is key. Managers and their direct reperis must joinly Wdentify
common goals,
define cach individual 's responsibilitics and cx peetationg, and understand how
they will be evalu-
med, Jokat goal seming and shared responsibility toward achieving them will
increase employee
motivation umi perceived empowenment, and provide 0 common direction toward
achiesement
Of organizanonal es.

The hierarchy of autbarity oullines the job insraetions within a company by

deseribing the
reporting relmionships-amang emplovees (rom lowest tevel to highest level.
Coordination and
control are provided by this hicrarehy. A firm with many workers reporting to one
manager has
a fat organisaron, Ns bengtus are good communicaron, guieker problem handling, and
berer
employee identification with a job, The major problem tends to be the mumber of
people reporniing
Lo one manager A read! oargonizerion has seweral managemen levels, resulting in
close supervisian
ami fewer workers reporting to cach manager. Problems include a long communication
chun-
nel, ihe ampersonal impression given to workers reganding access to upperlevel
personnel, and
inflexible rules.

With these Factor in mdnd, a retailer devises an organkentlon chart, whieh

graphically dis-
plays its hierarehical relationships. Table 1-1 Iists the primeiples to consider in
cstablishing an
argamsmlon chart, Figure 1 1-5 shows examples of basic organkantiom chiurts,

ORGANIZATIONAL PATTERNS IN RETAILING

An independent retailer he a simple organization, Itoperates only one store, the

owner/fmanager
usually supervises all cmployees, and workers huve nccess to the ownerfmanager if
there are prob-
ber, Ini contrast, a chain must specify how tasks are delegated, coordinate
multiple stomes, and
sel common policies for cmployces. As cxamples, the organizational arrangements
uscil by inde-
pemdent rerailers, deparament stores, chain retailers, and diversifiedl netoilers
ane discussed next.

Organizational Arrangements Used by Small Independent Retailers

Smull independents use ungomplicated #rrangements With caly two or hree levels of
persomuel
(ownerfmanager ad cmpboyces). and the ownerfmanager persanally nun the firm and
overswes
workers, There are few employees, little specialization, and no branch units, This
does not mean
fewer activities must be performed but hat many tasks are performed relative to the
number af
workers. Boch emptoyee musi allot pari of his-or her time 10 several dutics,

Figure (1-6 shows the organisations ef owo small firms, In Aa boutlaus is ergandasd
by fune-
tion. Merebandising personnel buy and sell goods and services. plan assorimenis,
sei up displays,

TABLE 11-1 Principles for Organizing a Retail Firm

An organkeaton should shaws Imerest in lis cmployces. This can bc done ihrough job
reatioa,
promotion from within, participabory manapemeni, recognition, job enridhmend, anal
s0 forth,

Employee turnover, lateness, and abscmecism should be ronitored, because ahey may
inddicate
personnel problems:

The line olf authority should be traceable from the highest to Ihe lowest
positions. In this way,
employoes know dc who tbc eps mad 4 kon nepoosis v0 hem Cebarin af cewmacamah,

A subardinate should repori io only one dinget superelsor (unit af comunamdi, This
awoids
Ibe probdem of wodkers receiving cooflicting onders.

There is a limit to ihe number of employees a manager can dinceily supervise Lapor
coarradi.

A person responsible fora given objective mess the power io achicve il.

Alihesugli a supervie cam debegaae authority, he or ae is still nespowndble for

sibordinates.

This greater tbe member of organizational levels, the longer abe time for
communication to travel
ate the greater Ihe coordinatian problems,

An organkeation bas an Informal seruetune aside Iromo 4 fommal organkeation chart.

Informal
relattonships crercise power in ibe Tire and may bispass formal pelatbonships and
ptoceeures,
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298 — PARTS « MANAGING A RETAIL BUSINESS

COMBIMATION

21 Pesan 2) l | |
manager manager manager mnanaper Gentrodier manager
1 1 l
al —ua 1 1
Locarion || Locarkon Location | Lotation Locackon | Locarkon Location || Location
|| Location Logjarar
Aa Ya A B In BG A B Ke Hm) Pose
manager manager
FIGURE 11-5

Different Forms of Retail Organization

and prepare ads. Operations persomiel are involved with stone maitetance and
operation, In B,
a Furniture store is organized oma product-oriemed basis, with personnel in coeh
category respons
sible for selected awuvitics, AJI products get proper attention, and some expertise
is developed.
This is importunt because different skills arc nocessary to buy and sell coach type
of furniture,

Organizational Arrangements Used by Department Stores

Many depariment siores continue to use an organizational arrangement that is an

adaptation of the
Magur plan, which divides all retail activities into Tour fungtional areas, In
iwenty-Tirst century
terms, these arc store management, communicalions, merchandising, and financial
accounting.
Figure 1 1-7 shovws the modem version of he Mapur plan, as devised by the aathors
of ihis besok:

|, Srore managemen: Operations, customer service, human resources, inventory,

“backroom?”
activities, ad store maintenance

2, Cmnmunicarians: Public relations, advertising, window and interior displays,

pronwtions.
and online efforts
CHAPTER IT » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT

299

FIGURE 11-6

Organization
Seru Used by
Small Independents

3. Merchandising: Buying, selling, stock planning and forecasting, and product-

positioning
(image-nelated) With regand to ihe mix of goods and services offened by Uhe
retailer
4. Financial accounting (overseot dv controller): Accounting, invemory control,
credit, and
“pahit gs
These arcas are organized into line (dincetauthority and responsibility ud staff
tadwisory
mod support) componenis. Titus, in Figure WI-7, the omnichannel acnager reports
directly to the

FIGURE 11-7
A Modern Version of the Mazur Organizational Plan for Department Stores

Sesanne: Chart develop by the aacihuars.

300 PART 5 « MANAGING A RETAIL BUSINESS

To discover mote abi

Kroger, go to this seclion af
its Web site Iwaaw
Ahekrogerco.coov
about-krogerfoperatiana i,

general manager and is a staff personj and 2 comiroller and a communications

manager often staff
services Tor merehandisers, but in aheir disciplines, personel are orgonieed and
ling basis,

The merchandising division is responsible for buying and selling. Itis hended by u
merchandising mannger, who is often Wewed as Ihe most important of ihe arca
executises, She or
he supervises buyers, devises fimaneiil goals for cach department, coondimates
merchandise pluns
(s0 there is co1sistent Image among depammens), and interpmes the ciee of coonome
dita.
In some cases, divisional merchamlise managers are utilizod, s0 Ihe number of
buyers reporting
tia single manager does not becarte una ielely.

In the busic Mazur plan, the buyer has complete wecoumability for expenses und
profit goals
within a department. Duties melude preparing preliminary bodgets, studying trends,
megotiat-
ing with vendors over price, planning the number of salespeople, and informing
sales personnel
abon Wc merchandise purchased, Groaping banding anal selling aetivines Imo one jab
(buyer) many
Poesemi 4 problem. Because buyers are not constanily on ihe selling floor,
training, scheduling.
and supervising persomasel rnny sur.

Branch store growth has led to ihree Muzur plan denivatisus: mad store control, by
which
hendguarters soeculives oversee and operate bramehes: seporate store organisartan,
by which cacti
branch has buying responsibilitics, and ceual store organization, hy which buying
is centralized
and branches becone sales manis sath cepu opera donal status, Tibe latter is Uve
most popular foot,

In ihe main store control format, neosi authonty remuins at heodgunricrs.

Merchandise planning
and barying, advertising, Tinanctal controds, store hotwrs, and other tasks are
gentrally manage to
standandize the performance. Branch store managers hang and supervise cmployces,
but daily operu-
tions conform bo company policies, This works well if ihere are few bainches and
ihe poeferencesof
customers are similar to those at Ihe main store, As branch store ingrease, buyers,
the advertising
manager, and others may be overworked and give Jive amention to branches. Becanse
hendguanters
Persomnel ane not at the branches, differences in customer preferences muy be
overlooked.
The separate stone format places merchandise manager in branehes, which have
aatonosiy
for merehandising and Operations, Customer necds are guickly noted, bat task
duplicatkon is pos-
sible. Coondinaton can also bea problem. Transferning p0o0ds between berameless is
more complex
and cosily. This Format is best if stores are large, branches are dispersod, and/or
local customer
lastes vary widely,

In tbos cepual store format, Ihe bengfis of both centralization and decemralizanon
4re sought.
Buying —forecasting. planning. purchasing. pricing, distribution to branclses, and
promotion—is
cemiralized. Selling—preseniing merchandise, selling. customer services, and
operations—is man-
aged locally, AI stores, including hendeyaarters, are teated alike. Buyers are
freed from munaging
s0 many workers, Data gathering is critical since buyers have less customer
contaci.

Organizational Arrangements Used by Chain Retailers

Varwus chidn retailers sea version of the oyual store organization, as depicted in
Figure 1-8.
Although ehains” organizations muy difter, they generally have these antribsutes:

» There are many Tunctional divistons, such as merchandise managememi,

distribution,
cntichannel, operations, neal-estate, personnel, infonmation systems, and sales
promotion.

» Overall authority is centralized, Store managers have selling responsibility.

» Many Operations are standard sed (ixtures, store Layout, buklding design,
merchandise lines,
credit policy, and stone service).

» An elaborate control system keeps managemen infonmed.

» Some decentralizntion le brandhes adapt to bocales and increases store manager

respansibili-
lics. Although large chains standardize most items their ovtlets carry, store
managers often
fine-tune the rest of the strategy mix for the Jocal market. This empowers the-
store manager

Organizational Arrangements Used by Diversified Retailers

A diwersified retailer 18 a mualti-line fonm operating under central ownership.

Like other chains,
a diversiffed netai Ter operates multiple stores, unlike typical chains, a
diversifbed firm is involvod
with different (ypes of retail aperatiois, Here are two example:

£ Krnger Co, (wwwkroger.com) operates supenmarkets, warehouse stores, supercenters,

con
venienoe siores, and jewelry stoness it also has a manafaduring group. The finm
owns multiple
store chains in caci of its retail cateporics. See Figure 1 1-9,
CHAPTER IT » RETAIL ORGANIZATION AND HUMAN RESGURCE MANAGEMENT 301

ea
1

FIGURE 11-38

The Egual Store Organizational Format Used by Many Chain Stores

Retail Managemem Advisor

alfers several cmpiayee
development lips (waw
ahe-netaii-adwksor.coms
inercasing employee.
performance, bim),

» Japan's Acon Co, (Wwwweondinfofen) comprses superstores. supermarket, discount

stones,
home centers, spewialty stores, convenience stores, financial services stores,
restimrants, and
more. Besides Japan, Acon has Facilites In mumerous other countries, Ius also a
shopping
center developer.

Due to multiple stritegy mixes, diversifhed netailers Face complex organizational

consider-
ions, Interdivision control is needed, with operating procedares armd gosils
elearly communicated,
For example, (1) interdivision competition musi be coondinated, 12) nesourees must
be divided
among divisions, (3) potential inage and advertising confTicts must be avoided, and
(4) manage-
mett skills must atap to different Operations.

HUMAN RESOURCE MANAGEMENT IN RETAILING

Human resowree management Involves reerulting, selecting, training, compensating,

and super-
vising personnel ina munner consistemi with the retailer”s organization sirudture
and strategy mix.
Personnel praetices depend on the ling of business, nuniber of employee, stone
location, and other
Factors, Because good persannel are needed to develop and canry out strutegies and
labor cosis
can amount Io S0 percent or more of cxpenses, ihe value of human resource managemen
is clcar,

Retailing in the United States cmploys 25 milhon people, Thus, there is da comstant
mocd to
@iraci new cmployces—und petain existing ones. For example, as many as 2 million
fist-food
workers jne aged 1610 20, and Uhey stay In aheir jobs. for short perieds, In
general, netailers nced
to reduce he turnover rate: when workers guoiekiy cita firm, the results can be
disastrous, See
Table (1-2, Turnover in retil averages around 86 percent for panetime bourly,
whereas It draps
to 27 percent for full-time cmployces with benefits such as health insurance.
Consider the approsches of Target. Zippos, and Wegmans Food Market:

«Target is committed to employee development and metention. Target challenges

cmployces
to innovate, collaborate, nd eiciently and invellgemiy provide the besi possible
shopping
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302 PART 5 « MANAGING A RETAIL BUSINESS

FIGURE 11-9
The Organizational Structure of Kroger Co. (Selected Store Chains and Positions)
Mare: Most Foroger supermarket are food-based combination siores,

Somser: Char developet bay the author based on maserial in its Kroger Ce. 2015
Asmaul Report, and ihe 2015 Keoger HNS Kari Bowl,
experience to customers. It believes cmpowering and training cmployees and
prowiding them
with oppomunities For professional growah wall heelp 15 business stay competitive,
Every entry-
level employee, whether hwurly ar full time, is mentored by the stone team Iender,
Campus

TABLE 11-2 The True Costs of Employee Turnover

Using fill-in emplovees amil permanent replacemens are found.

Severance pay for exiting cmployses,

Hiring new cmployces: udvertising, interviewing time, tnivel espenses, tesding,

soreening

Training c0os151 traibers, Iraindng marerials and technology, trainee compensalion,

supervisor
time (omthesjah inuining

Mistakuss andi lower prodoctislay ahdle new emplovees gain cxperionce.

Customer dissatisfuciton dve to the depamure of penev bon cempoyces and tbc ag
Of ncxperteneed worker.

Low of contindity unong co- workers.

Poor employee meorale when turmnawer is high.

Lower employee layalty to retailer when tumover is high.

The Burcan of Labar
Statistics compiles curreni
employment data on such
Job as petak sales worker
supervisors and managers
Dare, bla gowa,

CHAPTER AT » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT 303

recruits are encouraged to join the summer internship program an Minncapolis where
they
are tnained in Iendership skills as well as their Tunetbonal area (planning,
sofware Inining,
cto.) to ben successful member ofa Target soreldistribution center, comporate, or
techaology
leadership team, Company berefis Include healih coverage, a pension, a 40K plan,
tuition
reimbursement, life insurance, a paid sacatiot, and an annual bonus,

2 Bappos, an online retailer af shoes, apparel, and aeeesores (owned by Amazon.com

Ine,
since MMW) says its goal is to be the online service Icader. Employees call
ihemselves “Zap-
pandan” and claim they “Live to Deliver WOW” In sappesrt of the First core value of
ie Minat.
Employees get benefits such as vacation und sick days, a retirerient plan, life and
disability
insurance, medical and demal coverage, maternity aril paternity Ieave, tuiton
rcimbursement,
discounis (M6) on Zappos merchandise, and free shipping. Zappos helps employees
stay fit
bs having an onesire Timess center, a yoga studio, weight management programs, amal
Miness:
challenges, To help cmployees achieve a work—life balance, Zappos pays for dry
clcaning,
car washes, and oil changes: 0 even has an onsine Tbrary anal life coneh, healil
screening,
and a nap room! Company happy hours, fun events, and healthy on-site catering build
team
zunal Family spirit.

» Wegmans Food Markets is the only retailer on the Fonbes “10 Best Companies to
Work
For” list every year since 1968," It offers healih knsuranee to part-tamers,
telecommuting, job
sharing ad compressed work weeks, tuition peimbursemeni, puid vacations, and
substantinl
training. Fulldine employee turnover is low, WMepmans has multiple paths to carger
sugoesa
via lateral Iearning, cross-training, internships, and management tnining. Wegpmuns
carcs
about ihe well-being Of employee and empowers them to make decisians Uhdut
customers
guna the company.

The Special Human Resource Environment of Retailing

Ketailers face aa human resource enviroamem eharacterized by aa burge mamber of

inexpenienced
workers, long hours, highly visible cemployecs, a diverse work force, many part-
time workers,
and variable customer demands, These factors complicate employee biring, staffing.
and
supervisian,

The meed fora large retail labor faree often means hiiring those with Title or no
priorcxperi-
ence, Sometimes, a position in retailing represenis a person's firsi “real job,”
People are attracted
to retailing because they find jobs near to hore, and petall positions (such as
cashiers, stock clerks,
pd some types of sales personnel) may reguine limited cducatian, training, and
skill, Alan, ahe low
wages paid for some positlons result in the haring of nespenienced people. Thus,
high employee
turnover and cases of poor perfonmance, latencss, and ahsentecism may result.

The long working hours in retailing, which may inclade weekends, turn off certain
prospec-
Live cemployces. Many remilers now have longer hours because more shoppers want to
shop
during evenings and weckends, Accordingly, some retailers neguire at least two
shilis Of fall-tirne
emplayoes.

Betailing employees are highly visible to the castomer, Thus, when personnel are
selected
amel iruiwod, special care musi be taken as to ieir mannecrs and appcarance, Some
small retailers
do nod place enough cmphasis on employee appenrance (meat grooming and appropriate
attire).

RAVR Group aww johnmcaldwell.comtwegmup), HGA (http

hga-group. com), and Carter Murray (www cartenmurray.corh
spocialize in the global recruitment Of retail executives. Why?
Demand factors include ihe need for multinabonal execulives
10 offectively manage global retail operations. Tho supply stems
Iromi retail executives seeking foreign experience to better pre-
pare for high-level positsons, as welas indoiduak wanting the
excitoment of Ining In a foreign opuniry. Some exeoutive search

firmns suth as HGA Group specialise in a field of retading, others

such ad RWR Group are inyolved in eoscutive placemenit in a wide
variaty.of retail fialds. Al of Ihese companies have offices in major
cities thsoughout the Wwosid, Carter Murray, as an examgie, has
offices in London, Singapore, Hong Kong, Now Yosk, Germany,
and Ausiraka,

Discuss Tha adwantapas to both a company anda mogpectree

senployee of using a global executive recruitment firm.

Im
304 PART 5 « MANAGING A RETAIL HUSINESS

See how Awan offers

“inapiring work” and Is
tempowering women"
(Wwmawancompany.cona!
cancer.

As pari of her legacy,

Milary Mary Ash hetn behind
acharitable foundation
(waw.mikae Long.

It is common for retallers to have a diverse Labor force, with regard to age, work
expericnee,
gender, race, ane other factors, This means that inna must train and supervise
thekr workers s0
they interact well with one unother—and ure sensitive to the perspeclives und nceds
of cach other.
Home Depei's reeruitmem strategy Includes partnerships With several national
nonproht, govermn-
ment, and education organization to neoch out to the communites series and to
aftract a broad
Rupo or guaingd candidates with diverse back groundk, including AARP, NAACP,
National Urban
League, National Society of Hispanic MBAs, Mutional Black MBA Association Inc., and
several
U.S, military groups, In addition, Home Depot pirovides resources ba help recralts
succeed Ihrougih
Associate Resource groups und online tools such as “Military Skills Translator” to
help veterans
identfy posittons and job deseriptions that leverage skills acguired in tbe
military,

Due to long operating hours, retailer regulurty hire partaime workers. In many
supermarkets,
more than half (he workers are parntime, and problems may arise. Some parime
employees
arc more lackadaisical, Lite. absent, or likely to guii than full-time cmployees.
They musi be
elosely monitored, Like other Tirms, retailers hina large number of Millennials.
Ahhough this
group is generally technologically advanced, Millenniuls often have different work
values than
alder cemployees, A recent Gallup Poll fownd ihat Millennials are the least engaged
group in the
work force.” Here area number of ways to better motivate Millennials:'"

«Show the firm's commitment 10 society und respceted charitics by supporting

voluntcerism.
«Train mahagers 10 communicate froguently and opemly Wih Millennials,

Get Millennials actively involved in solving important problems.

Provide Millennials with mentors,

« Accommodute Millennials” needs with flexible hours.

Variations in customer demand by day, time perlod, or season mi cause dillicuhtics,

A mumber
Of U.S. shoppers make major supermarket trips on Saturday or Sunday. So, how many
employees
slwuld ihere be Monday Uroagh Friday and how many on Satarday ad Sumlay"
Dilferences by
time of day (morning, afternoon, evening), season, and holidays also affect
pluming. When stares
are very busy, even administrative and elencal employees may be neciled om the
sales Moe,
Asa rule, retailers should consider Ihese points:

Reeruitmeni mud selection procedures must efficionily generate sufficicnt

applicants.

Some training must be short becuse worker ine Iner perleneed and temporary,
Compensation must be perceived as “fair” by cmplovees.

Advawement oppomunitkes musi be available to cmployoes wo view retalling as a

career,
Employee appearunce and work habits mvust be explained ari reviewed.

» Diverse workers must be taughit 10 work topether well and amicably.

» Morale problems may result from high turnover and the many part-time workers.

» Full-and part-time workers may conter, especially if some Mull-timers are

replaced.

Various retail career opportunities are available to women and minorities. Thene is
still some
pooan for improvement, however.

VOMEN IM RETAILING Retailers have made bot of progress In career ad kancemem for
women.
According to the “M0 Women on Boards,” Ann Inc., Ayon, Chico's, Children's Place,
Estee
Lauder, HSN (Home Shopping Network), Maey's, Ulta, and Willlams-Sonoma Ine, are
among
the U.S, public finms with AM) perceni or more of corporate officers who are women"
The “2013
Catalyst Census: Kartune 300 Women's Representation by. MANCS Industry" mepet tote
Uhial
retailing has the highest percentage of women as corporate afficers among the 15
industry groups.

Women have more career aplons In retailing ahan ever before, as the following
examples
show. Mury Kay Ash (Mary Kay cosmeties), Debbi Fields (Mrs. Fislds” Cookies), and
Lillian
Vernon (the direel marketer) have founded retailing empire, As af 2016, women were
chief
executive officers in 21 of Forune 300 companics overall and/or chairpersons of the
board of
such U.S. -based retailers as Enterprise, Home Shopping Metwork, Ross Stores, Sum's
Club, anal
Victoria” Secret. Let's look ata brief profile of wo of these.

Kosalind Brewer is president and CEO of Sam's Club, She started her career with
Walmcart
in 2016 as regional vice-presidem of aperations. She iben was promotod 10 division
president of
Walmart Sowiheast, and ben president of Walmari East. In 2012, Brewer was named
president
and CEO of San's Club, She camed her bachelor's degree in chemistry from Spelman
College,
In 2015, Forbes nefemed to Rosalind Brewer as one of bhe “World's 100 Most Powerful
Women.”
Foriwae anmuallly lists the
best empboyers amang
public firm (http:/Mfonune
cow besi-ompardesi.

Kie Donal aw
abosimedonakls com/med'
comporate carocrsh aetively
enoonges diversity and
tanderstasiding.

CHAPTER 11 » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT 305

At Enterprise Holdings Ine., the parent company of Enterprise, Alamo, and National
car-
rental service providers with more Uh S19 billion in annual revenues, Pamela
Michalson has
been president and CEO since 2013, She is dbe higbest-ranking woman among the
world's largest
travel companies and has been named 00 Forte 's list of “Amerca's 50 Most Powerful
Women
in Business” every year since DM. Michalson gradunted from the University of
Missouri with a
bachelar of ana degree and began her career with Enterprise Rent A-Car in 198 Las
aa managemeni
trainee. She has grow the US nd international businesses and has been working oma
deal with
Missan fara car-sharing businesses Tor sudens at 90 collere campises.

Despite recent progress, women still secoum fara smull percentage of corporate
officers 31
publicly owned retailers. These mitiatives can help to increase the sumber of
female cxecutives:

Meaningful triining programs

Adwancemeni apportunitics

Telecommuting and (lex time—the ability of cmployees 10 adapt their work hours
Job sharing among two or more cemployees who cach work less than fall-time
Onsite child care

"

MINORITIES AND DIVERSITY IN BETAILING Sorteme”s 2016 “100 Best Companies to Wark
For”
study listed the top companies” minority dalistics, Among petai lers watha high
percentof minori-
Lies are Ikes (S2 peroem minorities), Mordstrom (S0 percenti, Whole Foods (43
percent), CarMax
(dl pereent), Mugzet Market (40-percent), Build-A-Bear (35 percent), Container
Store (30 perceni),
Wegmans Food Markers (21 percent), and RENT percent)."

As wil wornen, petailers have done many good things in the area oi minority
employment,
bur adsere is still more to be accomplished, Consider these positive cxampiles:

» CarMux strongiy belicves in having a diverse work foroe—aund not just because it
wants to
bei good corporae citisen. Carbtas levowws Ihat employee diversity contributes to
Iis already
strong competitive advantages. Through such diversity, CarMos has a brcudder view
Of ihe
marketplace and anracts ad ereuter sampe of customers. Ioontinuously sirives to
Ingat every job
applicang, employee, customer, and supplier with respect and fainness—regandless of
gender,
race, sesual orentalion, ape, and various other factors,

» Wulmurt is commitned to embracing diversity on all aspecis of its organization,

from is
Hss0cloles to ls suppher partners. Through ns Supplier Diversity Program," Walmar
works
with over 30X) suppllers owned and operatod by minorities, women, yeterans, al
disabled
people. In Aiseal 2016, Walmart parchased S14.7 billion (rom women ad mivority-
owned
busincsses.

£ Wulgreens shows is commitment (0 diversity as part of a multipronged effort It

includes
dealing with a minimum of 8 percent certified mimority business finms and 2 percent
other
certified diversifted businesses: and it cnoourages prime suppliers to use diverse
suppliers,""

The following list sugpesis some ways (or retailers to even bemer address Ihe needs
of
mincity workers:

» Have clear policy satemenis from 10p managemen as to he value of employee

diversity,
« Engage in active reeruitmeni programs to stimulate minocity applications.

s Ofer meaningful training programs.

Provide advancemem oppsrtanitics.

Have 2ero tolerance for insensitive workplace belaian.

The Human Resource Management Process in Retailing

The human resource management process consisis Of Uhbese imemelated personngl
aevities:
recrulimen, selection, training, compensation, and supervision. The goals are to
obtain, develop, and
retain employces, When applying the process. diversity. labor lag, ane privacy
should be refleetedl,
Diversity involves two premises2 1) employees must be hined and promoted in a fair
and open
way, without regand 10 gender, ethnic background, and other related Factor and (3)
in a diverse
society, the workpluce should be representative of such diversity.
There ane several aspects of Jabar lawa for retailer to-salisiy:

» Do not hire uoderage workers.

£ Danot pay workers “Off bhe books” Sunder te tube”)
306

PART 5 « MANAGING A RETAIL HUSINESS

» Da pot reguine workers to engage in illegal acts (such as bait-amd-switch

selling),
«Dao aot diseriminue in hiring or promoting worker,

» Do not violate worker safety reguluticns.

» Da pot disobey the Americans with Disabilities Act.

Da mat deal with supplicrs ihat disobey lahar laws.

Retailers must also be careful not to vbolute cemployees' privacy rights. Only
mecessary data abon
workers should be gathered arud stored, and such informution should not be fneely
disseminuted,

We not discuss cah horni resource management actiaty forsiles and middle-management
jobs, For further insighis, g0 10 our blog (www.bermanevansretail com),

RECAUITING RETAIL PERSONNEL Recruitment is the avlivity wbercby a retailer

generates a list
af job applicants, Table 1-3 Indicanes tube entunes of several key reeruliment
sources, In addition
to these sowroes, the Web now plays 4 bigger role in reeroitment. Many retailers
have a cancer or
job section ot their Web site, and some sectlong are as claborate as the overall
sites. Visit Target's
Web site (wwertarget.com), for example. Seroll down to the bottom ofthe home page
and click
Ot “more” and then “carsers.”

With entry-level sales jobs, retailers rely om edugational Institution, ads, walk-
ins Gor write
ins). Web sites Cneluding social media). and cmployee referrals. With muddle-
managenemi posi-
tions, netoilers rely on employment ngencics, competitars, ts, and employee
referruls. A retiler's
ustad goal is to generate a Iist of potential cmployecs, which is reduced during
selection. Firms
ihat accep4 applications only rom ilvosc meciing minimum stundards save alot of
time ad money.

SELECTING RETAIL PERSONNEL The company next sclocts new cmployces by matching the
traits
Of potential cmployces with specific job roguinemenis. Job analysis and
description, the appiici
tion blank, interviewing, testing (optional), nefenenoes, and a physical eco
(optional) ane tewots
in the progess, they should be imegrated,

In job analysis, information is amassedi on cach jobv's functions and reguiremenis:

dutics,
responsibilities, nptinede, interest, educatton, ex perienes, and physical tasks,
Its used to select

TABLE 11-3 Recruitment Sources and Their Characteristics

Sources

Characteristics

Dutside the Company

Educational inditations

Other channel members,

Kompelibors.

Advenisements

Empboyment agencies

Umsolicited applicants
Within the Company

Cumem and fomer

emplovees

Employee recommendations

2. High schools, basiness schools, community cola umiversitics, gradunte sehaats

lx Good for traiting position: cnsare mini are mel: capecially

useful when long-term contacts with insinuetors are dakslpad

2. Employees of wholesalers, manufactuners, ad ugencics, competitors, leads from

each of ihexe

lb. Keduce cxbend of uradning: cam evaluate performance sit prior Oonlah, must
nstrusi in
company policy: some negative morile if curreni employees feel by passed far
promotion

a. Mewspapers, bride pubdications, professional jaurnals, Web sites

hb Large guantity of applicants: 1verapa applicart guality may not be high:

costapplicant is lom:
meldlnbonul responsibility placed or «c cam ceeptable appllcailons by reoding
fob gonlifications in ads

4, Private organigatlons, profesional organizations, govenimeni, executive seanehi

firmis

lx Musi be carcdnlly setoctodi musi be determined who pays fee good Tor applicana
seroenling:
sPpeclalists in persarmel

& Walk-ins, writesims

b. Wide variance in guality: must be carefully sercened: file shok be kep far
Tuture pasitions

&. Promotion or ansfer of existing fall-time employee. pan-time employpees rehdning

of ladd oi
cmplnyoes
h. Knowledge of company pelicies and personnel: good for morale: honest appraisal
from
in-house supervisor

&. Friends, segudimunces, relative:

b. Value @f recommendations depend an bonesty and judgment of cumeni cmployees

www.downloadslide.com
CHAPTER IT » RETAIL ORGANIZATION AND HUMAN HESGURCE MANAGEMENT — 307

personnel, set performance standands, and xesigo salaries. Thus, depariment

managers ofien aci
Is the main sules associates for their areas, oversew odher sales associates, have
some adniinistras
tive dutics, report 10 the store manager, are eligible for bomuses, and receive
25,000 to S0
annually.

Job analysis should lend to written job descriptions. A traditional jab descriplian
contains a
posilioa's tile, teluionships Superior and sabeordinate), and specific rodes and
tasks, Figure 11-4
showed « store manager deseriMion, Yet, using a traditional description alone hus
been criticized.
Tumay limit job's seope, as welas its wulhority and respessibility, met let a
person grow Kimi
activities to (hose Iisted: and not describe how jobs are coordinuted. To
complement a traditional
Weseription, a goal-oriemted job descriplion eoumerates basic functions, the
relationship of cach
job to overall goals, the inerdependenee of positions, and information ows, See
Figure 1-1,

FIGURE 11-10

A Goal-Oriented 1 5
Job Description Aterit dredi In the Retaling Environmeni
for a Management 5 2 ki
Trainee AMALYTICAL SKILLS: ability to solve Retail ewocutives are problern solvers,
problems: strong numerical ability for Knowledge and understanding of past
analysis of facts and dara for planning, performance and presenc ciroumstances
managing, and controlling. form the basis for action and planning.
CREATIVITY: ability to gererate and Recall awecutivas are idoa people. Successful
recognize Imaginatise ideas and solutions: buying results frorn sensitive, aware
decisiant,
ability to recognize the need for and be: "while merchandising reguines
Imaginatiwe,
responsive to change, Anisa Bah Al an
Recall awecutives people.
DECISIVENESS: ability to make guick Mhatiae non Pena Dengan ar
sai menara ber aduan customer detires, decisions must be made
action, and commit oneself to completion. @wickly and cenfidenty in this
#ver-changing envirenment.
FLEXIBILITY: ability co adjust to tika Retail axecutives are Mexible. Surprises in
needs Of che sinuation petailing never cexse. Pilang must be alberedi
ability to adapt to diferent people, places, @uickly to a2commodate changes in
trends,
and things: willingness to do whatever is atyles, and) attitudes, while numerovs
neccssary to got tho task done. ongoing activities cannot be Ignored.
INFTIATIVE: abilty to originate action Retail cxecutives are docri. Sales volumes,
rather than wait to be told what to do stamina endang oa
and ability to act based on canvictian, beneran BEN,
LEADERSHIP: ability to Insgire others to Retail ewecutiwes are managers, Running a
trust and respect your judgmeng, ability to business means depending on others to
Golegate and to guide and persunda pot cha work done. One peran cannot
do ikal.
ORGAMIZATIOH: ability to catablah Retail cwecutises are jugglora. A variety of
ppriorities and courses of sotion for self" itiues, projeeti are conitanty
and/or others, skill in planning and in motion. To reach your goals, prioritici
following up. to achiove results. Imisst be set and work must be delegated to
others.
RISK TAKING: maka Retail aoecutiwes are couragecus. Success
berapi oral Perpres In retalling often comes froem taking
analysis and sound judgmene and to arcepe cabculated riska and the confidence
responsibility for the to try something new someone
STRESS TOLERANCE: abiliry to perform Retail awecutives are resillent. As the
under pressure, to thrive ari above description should suggest, retailing.
308 PART 5 « MANAGING A RETAIL #USINESS

An application blank is usually the first tool used to screen applicants: it

provides data
on education, cxpertenes, health, reason for lenving prior jobs, outside
activities, hobbies, and
references. Itis usually short, reguires little interpretation, and car bec uscal
as the basis for prob-
ing in an interview, With a welghted app eno bank, Ketors having 4 high relatonship
wil
Job success are given more weight than others: Retailers using such a form analyse
cament and
Past employee perforunee and determine the eriterih Ceducatton, experieneg, ete-i
besi correlated
with job success Gis measured by longer temure, better performanec, etc.) Alter
weighied scores
are awarded (0 all job applicams (based on data Uhey provide), a minimum total
score becomes
a cutoit poim. for hiring. An effcetive application blunk aids retailers in
lessening tumover und
selecting high achicvers.

An application blank shwuld be used along with a job deseripdion. Those meeting
minimum
job regukremenms are processed further, others ane immedinety rejected, In this
way. the applica-
ticn blank provides a guick and incxpensive method of sercening.

Tite interview secks information thar car be amassed only by personal (vestioning
and obser-
vation. Tt lets an crmptoyer determine a candidate's verbal ability, mote his or
her uppcarance, ask
(pbestions keyed 10 the application, and prodse career goals. Imerebewing decisions
musi be made
about the level of fonmality, ihe number and length of intervicws, ihe location,
the personfs) to do
the interviewing, nd the interview siructure, Mhese decisions oten depend an the
Interviewer”s
ability and the job's reguiremenis.

Small Onms tend 10 hire applicans based on thelr performance during interview,
Large finis
may have multiple stipes: camdidates who excel at the interview stage may then be
regulned to
take psychological tests (to mensure personility, intelligence, Interest, and
lendership). andfor
achievement tesis (to measurc Iearncd knowledge)"

Tests must be lministened by goalified people, Standard sed exms should nod be used
unless
proven effective in predicting job performance. Achievement tests deal with
specific skills or
information (soch as the ability to make a sales presemtalion, are caster to
imerprel Ihan psycho-
logical tesis, and show direct relationships between knowledge and ability. In
adoninistering tesis,
Fira musnot #bolate Federal, state, and local laws. The federal Employee Polygraph
Protection
Act bars finis Trom using lie detector tests in most hiring situntions Grugstores
are ckempu.

To save ne and operate more efhiciently, some netalers—large and small —use
computer-
i2ed application blanks and testing. Advance Aato Paris, Babics “R” Us, Besi Bay,
CVS, Family
Tree, Lowe's, and PetSmart are among those with in-store kiosks that allow people
to apply for
jobs, complete applications. and answer gucsiions. This speeds ihe process and
attracts applicants.

Many retailers get references from applicuns that car be checked cither before or
after ui
intervicw, Roferences are contocied 10 sce how enthusinstically iley recommend an
applicani,
check de applicani's honesiy, and ask why am applicant left a prior jab, Mail and
phone checks
are incxpensive, Tasi, and casy.

Some finis reguire a physical cxam because ofihe physical activity, long hours, and
tensions
involved in many retailing positions, A clean bill of healih means the candidate is
ofTered a job.
Again, federal, state, and tocil laws must be followed,

Eaeh step in the selection process complemenis the others, together they give the
retailer
g0xd information package for choosing personnel. Asa rule, retuilers should use job
description,

CVS Ibitps-Njohs.cvshcalth
00an) cromerages potential
employecs Io apply online.

Job-Listing Web Sites

fk number jol-Isting sites exist, such as www workinretail

cam, hittp:Mtotail jobs. carcercast. 00m, waw findtherighjab com,
waw job-apphcatlon.com, and #wswsnagajob.com. Altough
tach site has unigue features, together they Generally offer
job descriptions, locations, and more. Job seakers can peint
out this Information, view availabis powiions at multipde rotan
ers, and look up menamum age reguiremenis, hours of opera-
tion, and compensalion. Some sites provide E-mail alert about

avallabla positions in their geographic areas, Otivers let job seak-

rs sebectreety lok Far jala in specific fiekis, Stillathoralbaw jak
applicants 10 post their resumes. Fos retaders, Ihese sites ako
have advantage, indludaong acooss to a langer applicant pool, tho
ability to compile andi soreen applicants on a database, and better
matching candidate gualihications with 4 refaskar needs,
Discuss the pos and cons of a job spplican using a jab-isting
Web site to posi nisumits,
oj
FIGURE 11-11

A Checklist of
Selected Training
Decisions

www.downloadslide.com

CHAPTER AT » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT 309

application blanks, interviews, and reference checks, Follow-up antervicws,

psychological and
nehievemeng tesis, and plvgsical exoms depend on the retailer and the position.
Inespensive tools
(such us application blanks) arc used in ihe carly screening stages: more costly,
in-depth tools
(such as imerviewa) are used after roducing the applicant pool, Egual opportaniay,
pondiserimina-
tory praciices musi be fallowed.

TRAINING RETAIL PERSONNEL Every new cmployee should receive pre-tratning, an

indoetrina-
Lion an the Am's history, culnare, and policies, job orlemation on hours,
compensation, Ihe chain
of commund, and jab duties, The term onboarding describes 1he process of
integrating new
employees Imo an organ gadios and its culture, and rderstunding the capecudions of
eheir new job,
New amployees should be introduced to co-workers, encouraged to build relationships
with ad
diverse network of colleagues, and provided with tools, resources, and knowledge to
become
successful and productive. A well-designed onboarding process may evolve overan
entine year—
rom new employee onentation to conlinuous improvemen. Ii should be modiTiedl For
specific job
roles and locations and make the employee feel welcome,”

Tradning programs ccach new Cari existing personnel hot besi to perarn their jos or
ho
to improve themselves. Training cun range from I-day sessions on operating u
computerized cash
register, personal selling teclnigucs, or complianee with afinmative action
programs to d-year
programs for cxecutive tradnees om all aspects. of de retailer und its operitions:

» For cachncw cmployce. Comainer Store provides extensive formal training, which
includes.
understanding its “Employee First Culture,” systems training, and classes on how to
perferm.
multiple jobs, Each First-year, full-time employee neceives ahosit 260 howrs Of
training, The
New Store Trainer program has three phaises: pre-training (9 wecks pror to
opening). post-
suppoat (week of and after grand opening and post-triining (a few weeks after post-
suppart),
The training ensure ihat cmployces ane kowlodgcablc and cmpowered to offer the
cusiomer
service dhe retailer is known form the andustry.”"
«Besi Buy uses an online "Learning Lounge” (www. besibuylearninglounge.com| to
facilitate
employee training foriew and continuing workers, to keep cmpbopees cumeni on the
Terms
besi practices, and 10 let cmployoes casily communicate with one another, The
password-
Protected portal Is wmler the auspices af Best Buy Retail Training & Development
sroup.
whose slagan is "grow, perform. sucveed,”

Training should be an ongoing activity. New eguipnwemi, legal changes, new product
lines,
job Promotions, low employee murale, ad employee turnover mecessitate not only
training bat
also retraining. Macy's has u program called “Clienteling,” which tutors sales
associates on how
to have bettor long-term relations with specific repeat custorners, Core vendors of
Macy's Ieach
sules useociates ubout the features and benefits of new merchandise when it is
iniroduced.”

There are several training deelsiens, as slbown in Figure H-1, They can be dividad
anto ihnee
categorics: identifying needs, devising appropriate training methods, mud
evaluation,
310 PART 5 « MANAGING A RETAIL BUSINESS

TABLE 11-4 The Characteristics of Retail Training Methods

Method

Characteristics

Lectunes
Demonseratians

Videos
Programimed instruction

Conferences
Sensilivus timing
Case studies

Role-playing
Betiavior modeling

Factaal, uninterrapacd presentatons of material: can use professional adocatar or

ceper in (he Micld:
no aclive panticipatkon by traknees

God For shosing have 10 use eguipmsent or doa sabes presentation: appies melevanoe
off training: active
particapatlon by tralmocs

Highly visual. good for demonseration: can be osed many times: no active
panticipation by trainces

Presents information ina stroetured manner, reiuings response rom trainees:

provides perfonmaras
focdback: adjustable to tralwocs' pace, high Inlital Investment

Useful for supervisory training: conference Ieoalera must encourape participation,

meinforee tnining

Entensive intoraelioni good for supervisor asa tool Tor nderstunding cmployees

Actual Or hypothetlcal problems presented, including circomstanees, pertlaem

laformatkoa, and
geestions: learning by doing: ceposure toa wide variety Of problems

Trainees p Imo nesl- life sabuadi jund ac owl males

Tiralnees tougli 00 koslante mesdels shoven im videos or in role-playing sexabona

Competeney-based insoruetion — Trminees given 0 list of tnsks or enercises that are

presented in a self-pacad format

Take a hood gi

Beni Training.com's
Araining soduticns (www
pelailtrainingcoeni.

Shortterm treintng secas can be idontified by measuring the gap between the skills
that
workers already have anal the skills desired by the firm (for cach job). This
training should prepare
employees Tor possible job rotation, promotots, and changes in the company. A
longer tsining
Plan Icis 2 firm idemify future nceds and train workers appropriately.

Tbere ane many #reriming methoels for retailers: lecbures, demonstrations. videos,
programmed
instruction, conferences, sensitiity training, casc stedics, role-playing, behavior
modeling, 4d
compeleney-based instruction, Some technigues may be computerized, as evidenced by
more
and more finms.. The jatributes of the various training methods are noted in Table
1-4. Retailers
after use more than one technigue to reduce employee boredom and to cover the
material better.

Computer-based training software is avalahle from a variety af vendors, Forexample,

TIERI
Performance Solutions hus numerous modules hu have been used 10 train retail
cmployees in
such argas as point-of-sales systems. labor seheduling, customer service, manager
training, stone
@perations, merehandise managemen, and more, Among its many clients are CDW,
Kroger,
Macy's, McDonald's, Peico, and Wendy's,

For training to suceeed, a conducive environment is needed, based on several

principle:

Al people can learn itught well: bere should bea sense of achievement,

A person Iearns better when motivatod: imelligencc alone is not sufficient.

Leaming should be 2o1l-oriented,

A trainee Icams more when he or she penticipates and is nota passive listener.

Tire teacher must provide guidance, 25 welas adapa to Uc Ieamer and 10 the
situation.
Leaming should be approsched 1s a series of steps ruller Ihan & one-time
occumrence.
Leaming should be spresud om over a neasonable period Of cinee ratber than be
compnessed.
The Icamer should be cneouraged to do homework or otherwise practice.

Different methods of learning should be combined,

Performance stundards should bc set and good performunce recognized.

T"1..ururiur

A training program must be regularly evalumed, Comparisons can be mude between the
performance of those Who receive training and those who do not, as well as among
employees
necetving different tvpes of training for the same jab. Eveluartons should always
be made in rela-
Non (0 stated training goals, In addition. training effects should be measured over
differemi time
ineryals (such as immedimely, 30 days later, and 6 memths later). and proper
records mainained.

COMPENSATING RETAIL PERSONNEL Total compensation-lireet mametary paymenis

(salaries,
commissions, and komuses) and indirect paymenis (paid vacations, health and life
insurance, und
petinemeni plans—should be fair to tot the retailer and its cmployees. To betler
motivate cmployees,
some firms also have a profit-sharing plan. Smaller retailers ofien pay salaries,
commnissans,
This site (wwwdol.gani
ahdiminwagefamerica.himn)
shurers the minimum wage
in every state.

Sears ihtipaijobssears com

eliv-cbitoseusibenefits |
buas 0 pool bengfits
patkape.

CHAPTER 11 » RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT 311

aml/or bonuses and have fewer fringe benefits. Bigger ones generully pay salaries,
commissiors, and
0 bonuses and offer more Tringe benefits,

Although the hourly federal minimum wage has been $7,25 since July NM, 45 stutes
hawe
their oven Tawa — 20 pre higher uban the Sederal minimum and two are lower, In
2016, the highest
minimum wage was in Washington, DMC, (SU S0) and in these states: California and
Massachu-
sets (SIOL0015 Alsska, (5975 and Connecticut, Rhode Island, and Vermaont (S9L60),
Some states
amal citics are phasing ina minimum wage as high as $15.00 per hour. The minimam
wage has the
masi impact on retailer hiring entry-level, pardme worker. Full-time, canser-traek
retailing jabs
are typically paid am attractive market ratet to attract purt-time warkers in good
ccomomic times,
retailers musi often pay salaries above Uk minimum,

At some firms, compensatian for centain pasitions is set through collective

bargaining.
Aceording to the U.S. Burcan Of Labor Statistics, 825,09M) retail cmployees are
represented by
labsar unions, Yet, union membership varies grealy, Unionizod grocery stores
mecoumi for more
that cwve-half af total U.S. supermarket sales, wheneas independent supermarket are
not usul
unioied

With a streigfer salary, a worker is pada Fixed amoun per hour, weck, mom, or year.
Adwan-
tages are retailer control, employee security, and known expenses. Disadwantages
are netailer
inflexibilits, the Knited produetisity Incentive, and Kixed osis, Clerks and
cashiers ane usu-
ally paid salaries. Wih a srreigl comeeissian, carnings are directly 1ed to
productivity (such as
siiles volume), Advantages are retailer Mexibality, Ihe link to worker
prmluetivity, no fixed costs,
and employos incentive. Disadvantages are the retailer's potential lack Of control
over tlic tnsks
performed, the risk of low camings to employees, cost yarabillty, and Use lak of
Hmits on worker
camnings. Sales personnel for autos, real-estate, furniture, jewelry, ancl odher
cxpensive items due
often paid a straight comimission—as are direct-selling personnel.
To combine the attributes df salary and commission pluns, retailers may pay
cmployces a
salary plus comnisston, Shoe salespeople, major appliance salespeople, and some
management
personnel are among those paid this way. Sometimes, bonuses supplement salary
and/or commnis-
son, usuilly for outstanding performance, Al Finish Line foowear auul apparel
stores, regional,
district, and store munagers receive salaries and cam bonuses based on sales,
payroll size, and
theft goals, In certain cases, cxecutives are paid vina “compensation cafeteria” ud
choose their
cwm combination of salary, bonus, fringe benefits, life insurance, stock, and
rerirement benefits,

A thorny issue facing retailers today involves the benefits pertion af employee
compensa-
tion, cspecially as related to pensions and health care. It is a-challenging time
due to intense price
competitdom, the use of part-time workers, and escalating medical costs as
retailers try to balance
Iheir cemployces” needs with company financial mecds.

SUPEAVISING RETAIL PERSONNEL Supervision is Ihe manner of provuding a job

envinsumeni that
eneburages employee ascomplishment, The goals are 10 oversee personnel, atain good
perfor-
mance, nyintain morale, motivate people, control cosis, communicate, and resolve
problems.
Supervision is proviled bp personal contact, meetings, and report.

Every fin wants 10 comlimually motivate cmployees so Jas to harness their energy on
behalf
of the retailer und oclieve its goals. Job motivation is the drive within people to
ataia works
related goals. Itimay be positive or negative, These guestions can be used to help
prediet cmmplovee
behavior, based on their motivation:

Da you Iike ihe work you do? Does it give you a sense of aeccomplishment"
Are you proud to sie you work with us?

Does the work expected Irom you inflocnce your overall job attitude” Haw?
Do physical working conditlons influence your oven job attitude? How?
Ekres the way oi are Incatod by your boss afeel your job anime?

Do yoa understand ihe firm's strategy?

Do you sec a compeetion between your work amal ihe Tin strategic goals?”

1...

Employee motivation should be approached from iwo perspectives: Wu job-related

factors
cause empoyees to be satisficd or dissatished wath their positions? What
supervisian style is besi
for both thc retailer and its cmployees? Sce Figure 11-12.
Each employee looks at job satisfaction in terms of minimum cxpectations
(Sdissatisfi-
ers” mid desinal goals ("satisfiers” A motivaled employee reguires fudfillmeni of
both Tactars,
312

www.downloadslide.com

PART 5 « MANAGING A RETAIL #USINESS

IM RETAILING

Retail buying 5 often vewed as an exciting job, special when

Ihe goods boughit for resale comespond to an employess area
dd interest. For example, many fashion-oriented students are
attracted 10 an apparel buying position and avid computer users
may seok bayang positiong in electronic, Buyer Iraining gon-
eraly focuses. on technical aspects of buying (such as how to
evaluate the guality of hand-made carpots for carpet buyer,

Buyer Training

negatiating skills (setting decounts, markdowns, and credit

teerns), andi unelarstanding open-to-buy calculations (that recon-
cilo inventory and demand), Some retaders have formal training
propams, others offer on-the-job training where junior buyers
receme atkikonal responcibilities Over time.

What dio you think are the attributes of a good retail buying

FIGURE 11-12

Deamotivated
Employees Result in
Lower Productivity
Toclay, many Older adu
work am netalling—

Ie sapplememi their
retiremeni benefits. to

be active, andr ta ke

in a sociul setting. Ii

Is Importani that ihcse

workers be tncaded with
respect and not be placed
into menial, bewing jobs
Ihat do mod make use af
Ihcir skill set. If ibey are
unbappy, ima rab offon
Cute,

Sownor: Lia F- Young)

Shumeriogk. Keprincad hy
permission.

program
Wi

Mindetur erpectatios relate mesily to ihe job environment, ineluding & safe
workplace, egui-
table treatment for Ihose with he same jobs: some Mesability an company policies
(such as mat
docking pay ifa person is Mhminutes Inteh: an cven-tempered boss, some Freedom in
attires a
(nir compensaton package: basic inge benefits (such as saciation time and medical
coverngei:
clear communigations, and job security, These clemenis can generally influence
motivation in
only one way —negalively. Wmnimum cxpesetatlons are nol met, an employee will be
unhappy.
If these ex pectations are met, they are taken Tor granted and do little to
motivate the person ta go
“above and beyond.”

Desired goals relate more t0 the job than to the work emironment. Tibey ane based
on whethker
an employee likes Use job, is recogmised for good performance, fecls a senee of
achievement, is
empowered 10 make decisions, is trusted, has & defined career path, regeives extra
compensutlon
when performance is cxceptiomal, and is given Ube chance to learn and grow. These
clements cari
have a huge impact on job suisfhetion and motiyate d person to go “above and
beyond.” Nanethe-
less, if minimum expectations are not met, an employee might still be dissatisficd
cnough to leave,
even if the job is guite rewarding.

There are three basic styles of supervising retail emplovees:

» Management assumes ct emplopess musi be elosely sapervised and comirolled anic

ahat only
eeomomic indocements really motisate. Management further believcs that Ihe average
worker
CHAPTER 11 » RETAIL ORGANIZATION AND HUMAN RESGURCE MANAGEMENT 313

lacks ambition, dislikes responsibality, und prefers to be led. This 15 the

traditional vicw of
motivation and has been appliod 10 lower-level retail pasitians.

«Management assumes employees cam be self-managers and assigned aatherity,

motivation is
social and pepehologicil, and supervision can be decemtralised and perticipatory.
Manage-
ment also thinks that motivation, the capacity for assuming responsibility, anda
readincss to
aehieve company goals exist In people, The critical supervisory tasik is 00 create
an cnyipot-
Me s0 people uchicve their goals by antoining company abjeciives. This isa more
modem
view and appliss to all levels of pesonnel,

» Managemen applies a self-munagensent approach und also advocutes more employee

involve-
ment in defining jobs and sharing overall decision making. There is mutual loyalty
between
the firm and its workers, and both partics enthusiastically cooperate for the long-
tenm benefit
afecach, Oisas also made view and applies to all bevels of persomnel.

Itis imperative to motivate employees in & manner that yiclds job satisfaction, low
tum

over, low absentecism, and high productivity. Research an organizational behavior

on employee
motivation suggess that trade-offs among command, autonorny, respect for employees"
need
for self-delermination and cconomie incentives cam improve employee intrinsie
mativation and
performance, Some suggestions include: (1) Empower employees 10 solve problems, (2)
Ask
employces for their inpot. (3) Begulariy communiente with employees about bow they
are doing.
(4) Delegate tasks, (5) Encourage new kleas From employees, (6) Let employees learn
From thekr
mistakes without being undaly harsh. (T) Show employees what is needed for
promotions. (8)
Provide public recognition of good performance, (9) Seck employee inputon company
goals and

how to uchieve them

Chapter Summary

1. To study the procedures fnvolsed in serbng up arora!

Organizatoa. A retail organization #iructunes and assigns
tusks, policies, resownees, wuthority, responsibilitics, and
rewards tosatisfy the necds of is tirget market, cmploy-
6e3, dd management. There are five steps In setting up
an organization: oullining specific tasks to be performed
Ina distribution channel, dividing tasks, srouping tasks
into jobs, elussifying jobs, and inegrating positions with
am organisation chturt.
Specifie tasks include buying, shipping, receiv-
ing und checking, pricing, and marking merchandise,
inventory conirol: display prepuration, Tncilitics main-
Lenamces research, customer contact and Follow-sup: and
a lot more. These tasks may be divided among retailers,
manufacturers, wholesalers, specialists, ami customers.

Tasks are next growped into jobs, such as sales per-

sommel, cashilers, inventory personnel, display personnel,
customer service personnel, and managemen, Then jobs
are arranged by functional, produet, geographic, orcom-
bination elassihcation, An organization chart displays
the hberarehy Of autharity and the relationship among
jobe, and it helps coondinates personnel,

2, To cromine Ie varlons argankzetondl arrangemenis

tatilized In retailing. Retail organization structures dif-
Ter by institurica, Small indopendents use simple for-
mats with bitle specialization. Many department storcs
use a version of ihe Masur plan and place Punetians into

stone minagemeni. conimunications, merchandising, and

financial accounting, The egual store format is usod hy
numerous cidan More, Diversified firmis have very com-
plex orgunizations.

To cewaider re apecial In Kere An a

retailing. Retailers are unigue duc to the large number
Of inespericnced workers, long hours, emploves visibil-
its. a diverse work force, many part-time workers, and
variations in customer demand. There is a beoad range af
career oppertunilics available to women and minarities,
alihough improvement is still needed,

Te deserdhe me perinciples and peactices Invofved wvith

the Tumman resowree managemen peooes in eetailing.
This process comprises several interrelated aetivitics:
recruitment, selection, training, compensation, and
supervision. In applying the process, diversity, lahor
krars, and employee privacy should be kept in mind.

Beeruimeni generates job applicants, Sourges

include educational institutions, channel members,
competitors, ads, employment agencies, unsohicited
upplicants, cmployces, and Web sites (including social
media),

Personnel selection reguires thorough job analysis,

cecating job deseripioas, using application blanks, inter
views, testing topdional ), reference checking. and physi-
cal exams, Alter personnel are selecesd, they 20 through
314

PART 5 « MANAGING A RETAIL BUSINESS

pre-truining and job training. Good training identi-

Iies needs, uses proper methods, and assesses results,
Training is usually vital For continuing, as well as now,
personnel,

Employees are compensated by direct monetary pay-

ment aro indirect paymenis. The direct compensi-
ton plans are singa salary, straighi commission, und

Key Terms

reli

hierarehy Of mubority (p. 2879

Org
Mag

egual store organization (p. 30X)

diversificel retailer ip. BOX)

bumi

Dorganizati (p. 293)

peocess (p. DS)

recruitment ip. 306)
jok analysis (ip. AG)

nization chart (p. 297)

aer pilar (pa, 2881

an resource management (p. AH)

Ouestions for Discussion

L.

Cite at beast five objectives d large fitness center chain

should establish when setting up its organization
structure.

, Why arc employee needs important in develaping a

retail organisation'?

«Are the steps involved in setting up a retail organiza-

tion the same For small and lurge petailers" Esplain your
Answer,

. Deseribe ihe greatest similaritics and diffenences in the

organisaton siragtures of small indopendenis, chain

relailers. and diversificd retailers.
. How can retailers attroct and retain more women did

minority workers?

. How would small and large retailers act difteremily Tor

cach of the following?

2 Diversity

b. Recruitment

& Seleetian

Web-Based Exercise

Visit the career-basod Web site that Debenhams has

dedicated to graduate and non-graduate carcers (http!
debenhams-carcers.comv/), The department store chain has

human resource management

traditional job deseription (p. 307)

poal-oricmed job deseription (p, M7)
application blank (p. 308)

salary plus commission andfor bonus, Indineci paymenis

involve such iterns as paid vacutioas, healih benefits, and
retirement plans,

Proper supervision is needed to sustain superior

emplovee perfarmance, A main task is employee moti-
vaton, The causes of job salisfacton/dissatisbetion and
the supervisery style must be rewicwed.

werehted application bank (p. 3089

pre-training (p. 3091

ombosrding (p. 308

training programs (p. 300)

compensation (px 310)

supervision ip, II)

job motivation (p. IL

d. Training
e, Campensation
£. Supervision

. Why are ie job description and the application blank so

important in employee selection?

. What is Ihe purpose of ihe document derived Trom the

process of job analysis?

Ina retail environment, how would you distinguish

between presiraining and on-boirding? Why are they

both necesar?

| Distinguish between sinighit salary and straight com-

mission, Ilentifying the pros and cons Of each Tor af

compensation.

Haw would you deseribe the minimum ex pectations fan

employee that are fundamental to their job satisfaction?
Esplain your anawers.

. AF you were a retail store munager, what steps might you

take to cmpower your workers?

been operating for 200 years, What do you think of this

site asa mechanism for attracting new graduates and non-
genduates to the company?