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Home > Business > Special


HR factor in retail: Largely ignored

Rajendra K Aneja | December 30, 2006

The HR factor in retail management is still largely ignored.

The mood in India these days is "Goodbye, Socialism. Welcome, Sonyism". But the sudden explosion of retailing accentuates the principal challenge confronting Indian retailers in the coming decade: staffing operations and motivating teams.

The lack of formal retailing education further exacerbates the problem of recruiting. How should retailers build human relations in retail management?

The first ingredient is infusing a passion for success in employees. If the staff are the employees of the company, rather than outsourced from agencies, there will be greater commitment.

Further, retailers should make every employee a partner through a stock options scheme. A watchman who knows that he has a stake in the final profits, in the form of a bonus or a stock option, will ensure zero levels of shrinkage. Remember, businessmen must share their wealth with those who generate it.

Get the basics right

Retailing is a hard business. It is rigorous. The floor staff stands on its feet for up to nine hours every day. The job of the salesperson on the floor is physically exacting and emotionally draining.

Which is why changing existing mindsets and motivating personnel will also require ensuring basic hygiene factors. It is crucial to provide toilets, restrooms, canteens and dining areas, as well as recreation rooms to the staff.

The astute retailer will provide meals to the staff, so that they eat wholesome, nutritious food. He will provide not merely restrooms, but also resting rooms, for women, with a few beds.

This provision is law in many countries. Leading global retailer Marks & Spencer outsources manufacture of its merchandise. However, when it appoints a new supplier, its managers first check the staff toilets and dining facilities.

Also, in a competent retail organisation, each employee should spend at least 10 working days a year in the classroom. Training of the staff is the best investment in the retail business.

Training has to be constant, in the classroom and on the floors, on a daily basis. Business schools should come together to pioneer a new curriculum for master's degree in retail management.

Next to training is the vital policy of building careers and promoting people from within the company. Internal progression systems augment loyalty and boosts morale.

The staff are strongly motivated by the belief that they will grow when they deliver results. There should be a well-defined succession plan in the company and potential candidates should be groomed with adequate training and exposures.

Respect the floors

Astute retailers will walk the floors every day.  In a customer service-oriented retail outlet, the supervisory staff, managers, directors or the chairman of the company will walk the floors.

They will also seek advice and customer responses from the staff. As Sam Walton, the best retailer of our times, once said, "Our best ideas come from the shop floors.

Most CEOs are obsessed with the stock prices of their companies, their net worth and how many million retail sq ft they own. They do not focus on organisation-building or talking to the floor staff.

Looks do matter

Retailing is about the staff wearing clean, ironed uniforms. It is about shaving daily, using the right type and the right amount of deodorant; it is about bright eyes and warm smiles, about polished shoes, no straps showing through the uniform and no hairy armpits.

These are fundamental hygiene factors, but they can make or break a sale. It is a smart move to recruit the grooming and communications staff from top five-star hotels to train retail staff.

There are also organisational implications. How many sets of uniform should be given to a staff member? One of the largest retailers in West Asia gives only two blouses to the female staff. Should the girl be washing her blouse every night when she reaches home at 11 pm, after having been on her feet for nine hours? If one blouse is torn, should she wear the used one again, and perhaps smell stale?

Which is why manuals that define every operation of a store are vital: retailers like Woolworths and Marks & Spencer, for instance, have comprehensive operating manuals. The manual would clarify timings, responsibilities, operating conditions, policy on uniforms, leave, breaks, pilferage, shrinkages and so on.

Loyalty works both ways

Accept it: talent and skill are scarce. It is sensible to hold quality staff, always. Arrogance proclaims, 'There are a billion Indians; we can always find another salesman'. Sense states: 'You may find another candidate, but not a good salesman'.

Andrew Carnegie, the American steel billionaire, asserted, "Take away my factories, but leave my people, and soon we will have a new and better factory."

The people who work in the store are the family jewels. It is common to read in the newspapers of many corporations and retail houses boasting of the termination of 5,000 to 15,000 jobs, if the business is going downhill.

Such mass separations do not resolve underlying business issues and, in fact, pulverise morale on wholesale scales.

When a business performs appallingly, the issues really stem from dim-witted decisions and strategies conceived by the Board/CEO. The top guns survive. But 15,000 employees lose their jobs in loudly-trumpeted announcements across the media, in bizarre attempts to restore share market confidence. Such phony remedies have unforgiving impacts on employee morale and commitment.

Family ties

Working in any company should be fun and rejuvenating. The staff should look forward to coming to work daily. This is possible when the team spends informal times together.

Winning is great fun, becoming rich is glorious, and it is vital to celebrate success together. If the employees of a retail company dance, sing, eat, rejoice together, the company stays together.

Remember, the family that eats together, stays together. Retail is no different.

Rajendra K Aneja is CEO, Switz Group and former MD, Unilever, Tanzania



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