Human Resource Management in Retail Organization

Presentation by,
Dinesh K. C. Roll no. 12, S3, MBA, DCMS

RETAIL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT

1) 2) 3) 4)

Designing the organizational structure for a Retail firms. Retail Organization Structures Human Resource Management in Retail Trends in Human Resource Management in Retail

Human Resource Management

HRM refers to the way people are managed in an organization. Human resource is most important resource in management and needs to be used efficiently. This is because success, stability and growth of an organisation depend on its ability in acquiring, utilizing and developing the human resources for the benefit of the organisation.

Organization structure

A formal structure where the various activities to be performed by the specific employees are identified and delegated, indicating their authority and responsibility. is the formal system of task and reporting relationships that controls, coordinates, and motivates employees so that they cooperate to achieve an organization's goals.

Organization structure should:

Encourage employees to work hard and to develop supportive work attitudes Allow people and groups to cooperate and work together effectively

Organization structure
A retailer cannot survive unless its organization structure satisfies the need of the target market, regardless of how well employee and management needs are met. Most of the retailers do similar tasks such as buying, pricing etc. but there are many ways of organizing a retail firm.

The process of organizing a Retail firm

1) Outlining the specific task to be performed in retail distribution channel. 2) Dividing the task among channel members. 3) Grouping the retailers task into jobs. 4) Classifying the jobs. 5) Integrating positions through an organization chart.

1) Specifying the tasks to be performed

Buying merchandise Setting price Inventory storage Customer research Customer contact Facilitate shopping Customer follow up and handling complaints

2) Dividing the tasks among channel members

The tasks which are mentioned in the previous step does not needs to be done by a retailer only. It can be divided among the retailer, manufacturer or wholesaler, specialist etc.

3) Grouping tasks in jobs

The tasks can be grouped into jobs. For eg. - Displaying merchandise and customer dealings can be the job of sales personnel. - Entering data and managing cash can be the job of the cashier.

4) Classifying jobs

Here jobs are classified by categorizing them into functional, product, geographic or combination.

5) Developing an organization chart

The format of the retail organization should be designed in a coordinated and integrated way. With these things in mind , a retailer devises an organization chart which graphically displays the hierarchal relationships.

Organisation Structure for Small Stores

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

Back Office Staff External Advisors Lawyers, CAs, Bankers, etc. Responsibilities Accounting & Record keeping, data entry, inventory control, purchase orders, time keeping, etc.

Sales Staff
Responsibilities Customer service, selling, stock contro, display and housekeeping

Tasks to be performed in a Retail Orgn

Managem ent

Buying & Merchand ising

Store Operation s

Administr ation & Legal

HRM

Finance & Accounts

Branding, Marketing , Advertisin g & PR

The Human resource environment of Retailing

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The Retailers face a special human resource environment characterized by alarge number of inexperienced workers, long working hours, highly visible employees and variability in the customer demand.

These factors make the hiring , staffing, and supervision of the employees a complex process.

Contd..
Because of all these difficulties, the retailers should consider points such as 1) Recruitment and selection procedure must generate sufficient number of applicants. 2) The training programs must be short and should focus on developing the skills of employees. 3) Compensation must be perceived by the employees as FAIR.

Contd..
4) Employee appearance and work habits must be explained. 5) Full and part time workers should not have any conflicts.

Human resource management process in Retailing

Contd..
Recruitment is the process of searching the candidates for employment and stimulating them to apply for jobs in the organization. The purpose on Recruitment process is to make the job applicants available for the specific jobs.

Sources of Recruitment
External sources 1) Educational Institutions 2) Competition 3) Advertisements 4) Employment agency 5) Unsolicited applicants Internal Sources 1) Current and former employees 2) Employee recommendations

2. Selection

Selection involves the series of steps by which the candidates are screened for choosing the most suitable persons for vacant posts. The basic purpose of selection process is to choose the right candidate to fill the various positions in the organization.

Process of Selection
The application blank Interview Testing Reference check Physical exam Job offer

3. Training

Training is an important aspect of human resource management. Typically , in retail, training is needed at the following timesAt the time of induction At regular intervals to sales staff for skill enhancement.

Contd..

Training to the retail sales staff is very important because they are the face of the organization. Training is given to improve their communication skills, product knowledge, company policies on Returns, Market awareness etc.

4. Compensation
Methods of compensation 1) Straight salary Method Advantages - Employee security, Known expenses Disadvantages - Less Motivation 2) Straight commission method Advantage - High Motivation Disadvantages - The risk of low earnings

Contd..
3) Salary plus commission It means to combine the attributes of both salary and commission plans. The employee gets a fixed salary and a commission on achievements of the targets.

5. Supervision
Supervision is the manner of providing a job environment that encourages the employee accomplishment. The goals are to oversee personnel, achieve good performance, maintain employee morale and motivation, control expenses, and communicate policies. Proper supervision is needed to sustain a superior performance of the employees. Supervision is provided by personal contact, meetings and reports.

3 basic styles of supervision

1) Management assumes that the employees must be closely supervised and controlled. 2) Management believes that the employees can be self managers and assigned authority. 3) Management applies a self management approach and also advocates more employee involvement in decision making.

6. Motivation
In retailing, Motivation is very important because of the long working hours and the immense pressure on performance. The research on human behaviour has shown that most of the people at work are motivated by the following factors- The organization culture - The rewards - The monetary benefits - Growth and job enrichment

7. Performance Evaluation
The basis of the performance evaluation is the goals and targets that have been set for each individual. Through targets, the outstanding as well as the poor performances can be easily identified.

8. Building Employee commitment

The workplace is changing dramatically and demands for the highest quality of product and service is increasing. To remain competitive in the face of these pressures, employee commitment is crucial. This reality is applicable to all organizations but is of particular importance to small and medium sized businesses

9. Employee Retention

Employee Retention involves taking measures to encourage employees to remain in the organization for the maximum period of time.

Role of Human Resource Management in Retail: a Menu of Practices

Area of Practice Compensation Some Choices Available Lead, Match or lag the market, Basis of raises, long term tenure rewarded? Large differentials b/w employees Who?, how much?, what sorts of training?

Training

Staffing

How many?, mix of full or part time?, contingent employees needed?, employment security?
Criteria for new hires, promote from within? Employees involvement in decisions, formal voice in decision making Jobs narrowly or broadly defined, flat or steep hierarchy, workers organise in teams?

Hiring and Selection Workplace Governance Work Organization

Conclusion
In retail, as in any other business, defining the organisation structure is the starting point for managing a business. Define the organisation structure that enables the activities and tasks to be performed. This will help to human resources function in recruiting the right people for the right job and define the responsibilities, authority of positions and reporting relationships that are necessary for smooth functioning of the organisation

References
Pradhan, Swapna., (2007). Retailing Management, New Delhi: Tata McGrawHill. Internet sources.

Thank You!