HRM plays a very crucial part in retail because it performs critical business functions.
Retailers rely on PEOPLE to perform basic retailing activities
Financial Performance Problems Low Profits High Costs Employee Response Decrease Motivation and Effort poor Customer Service Lower Job Satisfaction Greater Turnover Retailer’s Response Layoffs Freeze on Hiring and Promotions Reduces Training Salary Freeze Greater use of part time employees and more outsourcing
POLICIES & SIPERVISION INCENTIVES ORGANIZATIONAL CULTURE BUILDING EMPLOYEE COMMITMENT DEVELOPING SKILLS CREATING A PARTNERING RELATIONSHIP WITH EMPLOYEE MANAGING DIVERSITY
Identifies the activities to be performed by specific employees Determines the lines of authority and responsibility in the firm The first step in developing an organization structure is to determine the tasks to be performed
Recruit, hire, train store personnel Plan work schedules Evaluate performance of store personnel Maintain store facilities Locate and display merchandise Sell merchandise to customers Repair and alter merchandise Provide services such as gift wrapping and delivery Handle customer complaints Take physical inventories Prevent inventory shrinkage
Promote the firm, its merchandise and services Manage human resources Distribute merchandise Establish financial control
Specialization Responsibility and authority Reporting relationships
Retail organization structures differ according to the type of retailer and the size of the firm. For instance, a retailer with a single store will have an organization structure quite different from a national chain.
Owner – managers of a single store may be the entire organization. As sales controlling employee activities is easier in a store than in a large chain of stores. The owner – manager simply assigns tasks to each employee and watches to see that these tasks are performed properly. Since the number of employee is limited, single – store retailers have little specialization. Each employee must perform a wide range of activities and the owner – manager is responsible for all management tasks. When sales increase, specialization in management may occur when the owner – manager hires management employees.
Common division of management into merchandise and store management : The owner – manager continues to perform strategic management tasks. The store manager also may be responsible for administrative tasks associated with receiving and shipping merchandising and managing employees. The merchandise manager or buyer may handle the advertising and promotion tasks as well as the merchandise tasks. Often the owner – manager contracts with an accounting firm to perform financial control tasks for a fee.
In contrast to the management of a single store, retail chain management is complex. Most managers and employees in the stores division work in stores located throughout the geographic region. Merchandising, planning, marketing, finance, visual merchandising and human resource managers and employees work at corporate headquarters.
MERCHANDISE DIVISION Responsible for procuring the merchandise sold in stores and ensuring that the quality, fashionability, assortment and pricing of merchandise. STORES DIVISION Responsible for the group of activities undertaken in stores. Each vice president is in charge a set of stores. General Manager – the store manager who is responsible for activities performed in each store. Assistant Store Manager for Operations – responsible for store maintenance; store security; some customer service; the receiving, shipping and storage areas of the store and leased areas including the restaurant and hair styling salon
The primary difference between the organization structure of a department store and other retail formats is the numbers of people and management levels in the merchandising and store management areas.
– is the degree to which authority for retailing decisions is delegated to corporate managers rather than to geographically dispersed regional, district, and store managers.
Retailers reduced costs when decision making is centralized in corporate management. FIRST, overhead falls because fewer managers are required to make the merchandise, human resource, marketing, and financial decisions.
SECOND, by coordinating its efforts across geographically dispersed stores, the company achieves lower prices from suppliers. FINALLY, centralization provides an opportunity to have the best people make decisions for the entire corporation
1. Improving Communications 2. Making store visits 3. Assigning employees to coordinating roles 4. Decentralizing the buying decision
CENTRALIZATION Retailers are using sophisticated information systems to make more decisions at corporate headquarters rather than by division staffs or store managers.
Flattening the Organization means reducing the number of management levels Outsourcing is purchasing from suppliers services that previously had been performed by company employees. Using the Internet