1. Retail Organization and Human Resource Management
Chapter 11

2. Chapter Objectives
To consider the special human resource environment of retailing (Productivity Trap)
To study the procedures involved in setting up a retail organization
To examine the various organizational arrangements utilized in retailing
To describe the principles and practices involved with the human resource management process in retailing

3. Insufficiently Qualified/
Low Wages
The Problem:
Productivity Trap
Insufficiently Qualified/
Motivated Employees
Low Productivity

4. Analysis: Productivity(Task) Function = Size of Task X Cost
Level of Efficiency
Cost per Unit
Productivity(Task) Function = Size of Task X Cost
Analysis Cost Level of Efficiency Unit Input

5. Solution Altering Compensation Levels (Lower Input Cost)
Part-Time Employees
Overtime
Incentive Compensation System
Reducing Workload (Reduce Size of Task)
Shift tasks to consumers
Shift tasks to suppliers
Shift tasks to outside agencies
Internal actions (e.g. kiosks)
Increasing Level of Efficiency
Employee scheduling systems
Technology
Task restructuring (e.g., specialization)
Training

6. Figure 11-1c: Management Needs
Planning and Assessing
a Retail Organization
Figure 11-1c: Management Needs
Figure 11-1a: Target Market Needs
Figure 11-1b: Employee Needs

7. Figure 11-2: The Process of Organizing a Retail Firm
Figure 11-3: Division of Tasks in a Distribution Channel

8. Figure 11-4: A Job Description for a Store Manager

9. Table 11-1: Principles for Organizing a Retail Firm
Show interest in employees
Monitor employee turnover, lateness, and absenteeism
Trace line of authority from top to bottom
Limit span of control
Empower employees
Delegate authority while maintaining responsibility
Acknowledge need for coordination and communication
Recognize the power of informal relationships

10. Figure 11-6: Organization Structures Used by Small Independents
Figure 11-9: The Organizational Structure of Kroger

11. Figure 11-7: The Basic Mazur Organization Plan for Department Stores
Figure 11-8: Equal-Store Organizational Format Used by Chain Stores

12. Human Resource Management in Retailing
Recruiting
Selecting
Training
Compensating
Supervising

13. Table 11-2: True Cost of Employee Turnover
US Monthly Employee Turnover Rates by Industry and by Geographic Region
Through Aug/06
Data is supplied by the U.S. Department of Labor
Annual Turnover = 34.7%
Acquisition
-Low level
-Middle level
-High level
Recruiting and hiring new employees
Training costs – including management time
Full pay and benefits during training, before full productivity is reached
Costs of mistakes made by new, inexperienced employees
Loss of customers loyal to departing employees
Lost or damaged relationships with suppliers
Employee morale and customer perceptions of that morale
Table 11-2: True Cost of Employee Turnover

14. Minorities in Retailing
Women in Retailing
Minorities in Retailing
Issues to address with regard to female workers
Meaningful training programs
Advancement opportunities
Flex time: the ability of employees to adapt their hours
Job sharing among two or more employees who each work less than full time
Child care
Retailing empires
Mary Kay Avon
Issues to address with regard to minority workers
Clear policy statements from top management as to the value of employee diversity
Active recruitment programs to stimulate minority applications
Meaningful training programs
Advancement opportunities
Zero tolerance for insensitive workplace behavior
Diversity
Labor Law Factors
Two premises:
That employees be hired and promoted in a fair and open way, without regard to gender, ethnic background, and other related factors
That in a diverse society, the workplace should be representative of such diversity
Retailers must not
Hire underage workers
Pay workers “off the books”
Require workers to engage in illegal acts
Discriminate in hiring or promoting workers
Violate worker safety regulations
Disobey the Americans with Disabilities Act
Deal with suppliers that disobey labor laws

15. Figure 11-10: A Goal-Oriented Job Description for a Management Trainee
Figure 11-11: A Checklist of Selected Training Decisions

16. Components of Compensation
Total compensation
Salary plus commission
Profit-sharing
ICR Compensation Survey-2006

17. Employee Behavior and Motivation
Several attitudes may affect employee behavior
Sense of accomplishment
Liking of work
Attitude toward physical work conditions
Attitude toward supervisors
Confidence in company
Knowledge of business strategy
Recognition of employee role in achieving corporate objectives

18. Style of Supervising Retail Employees
Management assumes employees must be closely supervised and controlled; only economic inducements motivate
Management assumes employees can be self-managers and assigned authority; motivation is intrinsic
Management applies self-management approach
Chapter 11 Discussion Questions: 5, 12

19. Happy Halloween!