CTE 3806 Study GuideChapter 9- Human Resource ManagementCompetitive advantage:•Labor costs account for a significant percentage of a retailer’s total expenses•The customer experiences are determined by the activities of employees (selecting merchandise, providing information and assistance, etc.)•These potential advantages are difficult for competitors to duplicateObjectives:•Short term- increasing employee productivity -Productivity= sales/# employees•Long term- employee attitude leads to customer satisfaction and loyalty-Increasing employee satisfaction ---> reducing turnover-Employee turnover= # employees leaving job during year/ # positionsProblem: employee turnover, 60% first-timers quit within a year full-time even higher for part-timeMaintaining employees is important part of human resourcesEmployee Productivity- how hard they work, how much they produce, reward people who do high salesEmployee engagement- an emotional commitment by an employee to the organization and its goalsChallenges- open long hours, peak sales periods, cost control, employees unskilled, part-time ---> high turnoverIssues:•Expense ControlControl expenses to be profitableRetailers often hire people with little or no experienceA modest investment in hiring more staff may result in a significant increase in sales•Utilizing Diverse Employee GroupsIncreased efforts to recruit, train, manage, and retain mature, minority, and handicapped workersDifferent approaches need to be used to manage younger and older employees•International Human Resource IssuesDifferences in work values, economic systems, and labor laws mean that HR practices must differThe legal/political system in countries often dictates the human resource management practicesOrganizational structure:•Identifies the activities to be performed by specific employees, and determines the lines of authority and responsibility in the firm•The design of the organization structure needs to match the firm's retail strategy. Top management, board of directors:develop retail strategy, identify target market, retail format, private-label merchandise, organizational structure, internet/catalog strategy, global strategyMerchandise division: buy merchandise, place orders, control inventory, budget, allocate to stores, price merchandiseStores division:recruit, hire, and train, evaluate performance, display, sell, repair and alter, handle customer, physical inventoryCorporate:marketing, manage human resources, manage supply chain, financial, visual merchandise, info systems, general counselCEO- responsible for overseeing entire organizationSenior VP of merchandise- works with buyers and planners to develop and coordinate the management of the retailer’s merchandise offering and ensure that it is consistent with the firm’s strategy.Senior vice president (SVP) of stores- supervises all activities related to stores, including working with the regional managers, who supervise district managers, who supervise the individual store managers.Chief operations officer (COO) oversees managers in charge of management information systems (MISs), supply chain, human resources, and visual merchandising.Chief marketing officer (CMO) works with staff to develop advertising and promotion programs.Chief financial officer (CFO) works with the CEO on financial issues such as equity-debt structure and credit card operations.Centralization:Advantages- difficult to adapt local market conditions, problems responding to local competition, hard to pay competitive wagesDisadvantages- reduce costs, lower prices from suppliers, best people making decisions, increase efficiencyEmployment marketing (branding)- marketing programs that attract “best and brightest” potential employeesMake employees happy- parking spaces, free vouchers, free uniforms- dry cleaning, profit sharing- company does well they get a bonus, gives incentive•Selective Hiring:-Recruit “the right people”-Simply seeking the best and the brightest may not always be the most effective approach•Training:-Increasing investments in management training programs and developing leaders-Increasing attention to college graduates- Generation Y•Policies and Supervision-Indicate what employees should do-Behavior enforced by managers•Incentives-Commission, Bonus, Stock Options•Organization Culture-The set of values, traditions, and customs of a firm that guides employee behavior-Behavior enforced by social pressure•Empowering Employeesempowerment is the process of managers sharing power and decision-making authority with employees-Gives employees confidence-Provides greater opportunity to provide service to customers -Employees are more committed to firm’s success•Creating Partnering Relationships with Employees-Reducing Status Differences-Promotion From Within-Balancing Careers and Families•Managing Diversity--Human resource management activity designed to realize the benefits of a diverse workforce, which includes but is not limited to skin color, nationality, gender, sexual orientation, and people with disabilities.•Support Groups and Mentoring-Groups of minority employees that exchange information and provide emotional and career supportLegal issues: equal employment, compensation- overtime, labor relations- unions, safety, sexual harassment, privacyChapter 10- Info systems & supply chain management•Efficient and effectively manage the flow of merchandise from the vendors to the retailer’s customers.•Integration of suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless value chain. •Merchandise is produced and distributed in the right quantities; to the right locations; and at the right time.•Minimization of system wide costs, while satisfying the service levels their customers require.Strategic Importance: increase sales by making sure right product, right place at right time, greater assortment less inventory, reduce costs, improved ROAZara’s strategic advantage: communication from stores to corporate fast, shorter time from design to production to delivery, shorter lead time, no discounts necessary Benefits of supply chain management to customers: reduced stockouts- merch available when customer wants it, tailoring assortments- right merch available at right storeEfficient Supply Chain Management leads to: •Increased Sales from more attractive assortments in stock•Improved Net Profit Margins from increased gross margin and