Human Resource Management

1. Chapter 9
(Retailing)

2.  This chapter focuses on the broad strategic
issues involving organization structure; the
general approaches used for motivating and
coordinating employee activities; and the
management practices for building an
effective, committed workforce and reducing
turnover.

3. Objectives of Human Resource
Management
The strategic objective of human resource management is
to align the capabilities and behaviour of employees with the
short- and long- term goals of the retail firm.
 Employee productivity
The retailer’s sales or profit divided by the number of
employees.
 Employee turnover
The number of employees leaving their job during the
year divided by the number of positions.

4. The Human Resource Triad
The full potential of a retailer’s human resource
is realized when (3) elements of the HR triad
work together – HR professionals, store
managers, and employees.
HR professionals
Responsible for establishing HR policies that
enforce the retailer’s strategy and provide tools
and training used by managers.

5. Cont...
Store or line managers
They are responsible for bringing the policies to life
through their daily management of the employees
who work for them.
Employees
They can play an active role by providing feedback
on the policies, managing their own careers, defining
their job functions and evaluating their managers and
co-workers.

6. Special HR Conditions Facing Retailers
Human resource management in retailing is very
challenging due to:
1. The need to use part – time employees.
2. The emphasis on expense control.
3. The challenging demographics of the workforce.

7. Retailers operating in international markets
face additional challenges
1. Part-time employees – Part-time workers can be
more difficult to manage than full-time
employees because they are often less committed
to the company and their jobs and more likely to
quit than full-time employees.
2. Expense control – Retailers often operate on
thin margins and must control their expense.
Thus, they are cautious about paying high wages
to hourly employees who perform low-skill
jobs.

8. Cont...
3. Employee demographics – The changing
demographic pattern will result in chronic
shortage of qualified sales associates. Retailer
need to explore various approaches for operating
effectively in a tight-labour market – increase
retention; recruit, train, and manage minorities,
handicapped, and mature workers; and use
incentives and technology to increase
productivity.
4. International human resource issues – Labour
law means that HR practices that are effective in
one country might not be effective in another.

9. DESIGNING THE ORGANIZATION
STRUCTURE FOR A RETAIL FIRM
Organizational Structure – Identifies the activities to
be performed by specific employees and
determines the lines of authority and
responsibility in the firm.

10. The task are divided into (4) major
categories in retail firms
1. Strategic management
2. Administrative management (operations)
3. Merchandise management
4. Store management

11. Matching Organization Structure to Retail
Strategy
 The design of the organizational structure needs
to match the firm’s retail strategy.
 Retailers tends to have more managers and make
decisions at the local store level
 When more decisions are made at the local store
level, human resource cost are higher, but sales
also increase because the merchandise and
services are tailored to meet the needs of local
markets.

12. Organization of a Single-Store Retailer
 The owner-manager of a single store maybe the
entire organization.
 The owner-manager simply assigns task to each
employees and watches to see that these task are
performed properly.
 Each employee must perform a wide range of
activities, and the owner-manager is responsible
for all the task.

13. Owner-Manager
Strategic management
Accountant
Financial control
Store Manager
Merchandise Mngr.
Store Mgnt.
Merchandise Mgnt.
Human resource Mgnt.
Advertising & Promotion
Distribution
Salespeople

14. Organization of a National Chain Store
 Managing a national retail chain is much more
complex because managers must supervise units
that are geographically distant from one another.

15. Chairman &CEO
President & chief Chief Operating
Merchandising Officer Chief Financial
Officer Officer
General
Merchandise
Managers Director of Stores Chief Information
Officer
President of
JCPenny Direct
Director of supply Chief of Human
chain Resource &
Director of
Administration
planning &
Officer
Allocation
Director of store
Environment,
Chief Marketing General Council &
Design, and
Officer Secretary
construction
Director of product
Development &
Sourcing

16. MERCHANDISE MANAGEMENT
 The merchandise division is responsible for
procuring the merchandise sold in the store and
insuring that the quality, fashionability,
assortment, and pricing of that merchandise is
consistent with the firms strategy.

17. M.A.T.
 The buyer, allocator, and planner for each
merchandise category for a merchandise action
team (MAT) that is responsible for managing the
merchandise category.

18. BUYERS
 Buyers are responsible for procuring
merchandise and building and
maintaining relationships with
vendors.

19. ALLOCATORS
 Is responsible for allocate
merchandise and tailoring the
assortment in several categories
for specific stores in a geographic
area.

20. PLANNERS
 The planner is responsible for
financial planning and analysis of
the merchandise category.

22. Centralization
 Centralization is when authority
for retailing decisions is delegated
to corporate managers rather
than to geographically dispersed
managers.

23. DECENTRALIZATI
ON
 Is when authority for
retail decisions is assigned
to lower levels in the
organizations.

24. Coordinating
Merchandise and Store
Management

25. Improving
Appreciation for the
Store Environment

26. Making Store Visit

27. ASSIGNING
EMPLOYEES TO
COORDINATING
ROLES

28. Motivating Retail
Employees
 A critical task of human resource management
is to motivate employees to work toward
achieving the firm’s goal and implementing
strategy.

29. Policies and Supervisions
 The most fundamental method of coordination
is to:
1. Repair written policies that indicate what
employees should do.
2. Have supervisors enforce this policies.

30. INCENTIVES
 The second method of motivating and
coordinating employees uses incentives to
encourage them to perform activities
consistent with the retailers objectives.

31. TYPES OF INCENTIVE
COMPENSATION
1. Commissions – is compensation based on a
fixed formula.
2. Bonus – is additional compensation awarded
periodically on the basis of an evaluation of
the employees performance.

32. Drawbacks of
Incentives
 Incentives are very effective at motivating
employees to perform the activities on which
the incentives are based. But incentives also
may cause employees to ignore other activities.

33. Organization Culture
 An organization culture is the set of
values, traditions, and customs of a
firm that guides employee behavior.

34. Developing and
Maintaining a
Culture

35. Building Employee Commitment
• Developing skills
• Empowering employees
• Creating partnering
relationships

36. Developing skills
SELECTIVE HIRING
The process of recruiting, selecting and training
of personnel; to fill the right people for the right
job.

37. Developing skills
STEPS IN SELECTIVE HIRING
1.Job analysis
2.Requisition of new employee
3.Actual recruitment of applicants
SOURCES OF APPLICANTS
1.Internal
2.External

38. Developing skills
STEPS IN SELECTION
1.Reception of applicants
2.Preliminary interview
3.Application Form
4.Employment test
5.Final selection of immediate supervisor or
department head
6.Physical and medical exam
7.Hiring
8.Orientation/Induction/ Indoctrination

39. Developing skills
TRAINING
The systematic development of attitude,
knowledge and behavior patterns for the
adequate performance of a given job or task.

40. Developing skills
COMMON TYPES OF TRAINING
1.On-the-job training & job rotation
2.Vestibule training
3.Apprenticeship
4.Classroom training
5.Programming instruction
6.Management development program

41. Empowering employees
 This is the process in which managers share
power and decision-making authority with
employees.

42. Creating partnering relationships
REDUCING STATUS DIFFERENCE
This is an attempt to create less difference from
the higher level of management from the lower
level employees by changing job titles and
changing wage differences.

43. Creating partnering relationships
PROMOTION FROM WITHIN
This is a staffing policy that involves hiring
new employees for a higher position only from
within the company. This is to promote fairness
and loyalty to the company.

44. Creating partnering relationships
BALANCING CAREERS AND FAMILIES
This is a benefit provided by some companies
for employees to effectively manage their time
for work and family. Some services include shift
scheduling, job sharing, childcare and employee
assistance program.

45. Issues in Retail Human Resource
Management
• Managing diversity
• Legal and regulatory issues
• Use of technology

46. Managing diversity
DIVERSITY TRAINING
This consists of two components which are
developing cultural awareness and building
competencies.

47. Managing diversity
SUPPORT GROUPS AND MENTORING
This assigns higher-level managers to help
lower-level managers learn the firm’s values and
meet the senior executives.

48. Managing diversity
CAREER DEVELOPMENT AND
PROMOTION
This is a form of management by providing
career paths to different workers depending on
their strengths, gender, skills and other factors
that would help in their career in a company.

49. Legal and regulatory issues
EQUAL EMPLOYMENT OPPORTUNITIES
This is a policy wherein companies cannot treat
employees differently simply on the basis of
their race, color, religion, sex, national origin,
age or disability status.

50. Legal and regulatory issues
COMPENSATION
These are laws related to compensation of
employee with the apropos pay rates, benefits
and allowances regardless of their race, color,
religion, sex, national origin, age or disability
status.

51. Legal and regulatory issues
LABOR RELATIONS
These are laws where it describes the process
by which unions can be formed and the ways in
which companies must deal with the unions.

52. Legal and regulatory issues
EMPLOYEE SAFETY AND HEALTH
These laws are about the basic premise that
employers are obligated to provide a working
environment that is free from hazards that are
likely to cause death and serious injuries

53. Legal and regulatory issues
SEXUAL HARASSMENT
These are laws that govern the protection of
workers toward unwelcome sexual advances,
requests for sexual favors and other
inappropriate verbal and physical conduct.

54. Legal and regulatory issues
EMPLOYEE PRIVACY
These are policies regarding the privacy of
employees in their workplace. These include
their workspace, personal property and other
scrutinizing tests.

55. Legal and regulatory issues
DEVELOPING POLICIES
This is the responsibility of the human resource
department to formulate new policies that will be
applied to the management depending on the
nature and need.

56. Use of Technology
 This is the use of intranets in retail chains in
order to streamline the workflow and to
automate other processes to reduce time on
filing and paperwork by employees.