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How to solve high employee turnover rate in a retail company or retail business? Essay

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Introduction

The problem of high turnover employee rate is quite a spread problem that most businesses have been facing for years. Employee turnover has a negative influence on the efficiency of business, profits, customer service and satisfaction from customers in different businesses and industries.

The recent study made by Roper Starch Worldwide, Inc. and Unify Network in a wide range of industries and businesses showed a strong link between employee retention and the satisfaction from the service quality got by the customers.

As the research was based on the analysis of 3005 interviews it has quite strong facts and conclusions.

“The negative effects of the increase in employee turnover are no longer being felt exclusively by the human resource managers,” said Tom Casey of Unify Network’s talent management practice.

“It is apparent that consumers are directly impacted by turnover as well,” Casey added. “As a result, turnover is now a principal concern because it directly affects the bottom line.”                Casey also added that new attitudes towards the workforce, as well as drop in the birth rate, and the emergence of innovative technologies have resulted employee turnover to skyrocket across retail business.

   The most vivid outcome of the employee turnover is a direct effect on customer retention or the loses of customers. In the whole, more than 60 percent of the respondents of the survey, who were the customers of retail companies with high employee turnover, said that they were less than satisfied with the service they received. Companies, themselves, confess that high employee turnover issues cause more problems than product or price issues.

 In the average one in three consumers marked that employee turnover negatively and directly affected the quality of the service. And just 20 percent of the survey participants agreed that they would like working for their service provider. Another problem of low level of satisfaction from customers was named to be low quality and absence of needed qualification and skills. To be more specific fifty seven percent of respondents agreed that the problem was in poor training, and only 20 percent remained satisfied with the quality of the service. 

The Consequences of Turnover

The outcomes of turnover cause extra expenses, loss of valuable time and stagnation in business. All these are quite obvious results of turnover, because it’s not that easy to find a qualified worker nowadays, especially one that will fully suit the position he is hired on.

The impact on business of the turnover will be reflected in “hard” and “soft” costs that are associated with looking for a new employee as well as the following factors:

  • Customers get lower quality services that changes the reputation of the company
  • Managers spend time looking for employees, which prevents them from their primary functions in the company which results in lower organization of business
  • Disorder in the company influences on the work of other employees

 

It’s estimated that replacement of workers will cost   from 33% – 250% of the

annual wages, depending on the workers position.

Hard Costs $$$

Pre-Departure

Exit interview                                             29

Separation processing                                12

Vacancy Costs

Temporary fill-ins                                      902

Coworker overtime                                    483

Advertising job availability                       110

Recruiting administration                           97

Selection and Sign-on

Interviewing                                                110

Testing                                                        100

Reference checking                                     28

Informational literature                                50

On-the-job training                                     874

Total                                                          $2,795

Soft costs

Besides “hard” costs there exist soft costs that come out with losing of the employee, and that make more understandable and clear the outcomes and consequences of losing an employee. It even often happens that it cost 10 times more to look for a new customer than to gain repeat sales. In addition the company is more likely to get what is called “ turnover causes turnover” and the company is likely to lose other employees.

Soft Costs $$$

Pre-Departure

Lost productivity of incumbent                             80

Lost productivity of coworkers                             97

Lost productivity of supervisor                             207

Vacancy Costs

Lost productivity of vacant position                       0

Lost productivity of supervisor                             138

Selection and Sign-on

Lost productivity during learning curve                482

Lost productivity of coworkers                              0

Lost productivity of supervisor                              483

Combined Impact

Current business lost                                              350

New business not acquired                                    350

Turnover resulting from turnover                         350

Total                                                                      $2,537

Add up the costs

This statistics is more likely to be called a demo illustration of what can be the impact of the $7 per hour job loss. The loss of a big employee number can deadly reflect on the financial health of the company and can even cause bankruptcy.

The exist lots of strategies that allow to reduce turnover rate in business, but nevertheless none of them can be suitable for the majority of retail businesses, because of  their specifics, particularities in the working atmosphere, relationships in working time, etc. But still there are strategies that will make business more effective and will stabilize the working atmosphere in the company. By the observation of many specialists who worked on the issues of high employee turnover in retail business for years, it became obvious that its reason is in low effectiveness of human resources departments of the companies. In the most companies with high turnover rate human resource managers did not more than simple recruiting and interviewing people, who would more likely to leave the company in months by their expectations but had not a big choice.

“Evaluate your company

A good first step in improving your retention rate is to ask yourself these questions. If

you answer “no” to more than two questions, you are likely to be experiencing high

employee turnover.

  • Are most employees clear about your company’s mission?
  • Do any of these words appear in your mission or core values? Respect,

teamwork, trust, fairness, openness, and development.

  • Do most or all employees have written job objectives?
  • Are employees actively involved in shaping their own job assignments or projects

to include their own personal interests and abilities?

  • Does a manager speak with associates each quarter about their changing

performance priorities and matters affecting their work?

  • Does your company regularly invest in developing employee knowledge and

skills?

  • Does your company routinely applaud individual initiative and provide

recognition for large and small performance successes?

  • Would most employees say their manager is supportive of their ideas and

concerned about their needs?”

 

Different approaches to solve the turnover problem

The experience of one of the researches, Louis Rovner, Ph.D., was more than bold or genius.

He was employed by many retail companies that had problems with high turnover, and some of them had 50% turnover rate from the entire workforce employed a year.

 As a skillful and qualified manager he spent hours conducting endless interviews and administrating numerous surveys and quizzes to determine the reasons of turnover and reasons of what the employees were unsatisfied with.

  To his expectations if the company changed the way of employees treating, the workers will be more satisfied and there will be more chances that they’ll stay in the company. But the problem was more complicated that it seemed to be for the first sight.

  Employees were managed cooperatively. People were encouraged and reinforced, the working schedule was optimized and was better control as the other modern management measures were taken to improve the labor and working atmosphere conditions. The employees got a higher range in the strategic decision making participation as well as new approach to please unsatisfied customers. The company was changing to one were the workers as well as their labor and participation was highly appreciated and valued.

  Even though that much had been done and the expectations seemed to look very optimistic the true results were opposite to what was expected at the beginning. The 50% turnover rate didn’t really change, but it became worse because in the list of those who left their jobs were the oldest and the most qualified employees of the company. So the impact of such outcomes seemed to be more negative than usual practices for the company.

 The analysis had shown that there were two main reasons for such outcomes, that primary related to job psychology. The first one was explained by the failure of managers to arrange things in proper order because they were unfamiliar with new strategies and considered them to be irrational and illogical. The lack of comfort in new working tendencies resulted the failure of the introduced strategies. New form of management resulted in lack of attention to the primary functions that began to fulfill improperly that resulted in profits fall.

The second reason appeared to be more commonplace than the first one.  One group of unhappy employees was replaced by other one, and the cycle was repeating again and again. But the was a significant change in this practice, that qualified employees appeared in this list. As in every company there always exists a group of employees that are satisfied with management, working conditions and their work as well, and they form the basement of the company’s team. With new changes that began to occur in the company their needs never no longer met and the conditions of labor no longer fully satisfied them. In this case the management that was introduced in practice was directed to satisfy primary the newcomers, but it didn’t meet the needs of checked and long working employees.

  The solution of the problem became obvious and the reasons of the failed management were determined. The problems with employee turnover are based not in something wrong with the decisions taken by the company’s authorities, but they are related to the people employed who most likely don’t suit the business they are hired for.

  The first steps that need to be taken to stabilize the staff policy and regulations, should identify best long-term working employees and look for the business qualities they possess in those that need to be hired. Those, unsatisfied who are more likely to leave should be replaced by those who have much in common with company’s loyal workers.

  In order to be successful in hiring productive and loyal employees it’s necessary to spend some time with the core group of the company to study their likes and preferences of working in the company.

 

Strategies for improving labor conditions

The workers a company hires are expecting more benefits from their work along with the salary they get. As it’s predicted by the experts in the nest five years, most of businesses will offer a wider range of benefits and programs for their employees, which will cause addition competition on the market labor as well as probable employee turnover in the companies that will not be able to accept new changes. These benefits and programs will most likely include:

  • Paid time off plans
  • Domestic partner benefits
  • Flexible scheduling
  • Flexible spending accounts
  • Retirement and financial planning
  • Employee assistance programs (EAPs)

It’s naturally understood that employees want to get competitive encouragement from their work as well as competitive salaries. The loss of employees may be both because of salaries that are not competitive (financial issues) and because the job doesn’t meet the needs of the employee.

As it’s quite know people leave their jobs for plenty of reasons that can be controlled by the managers or the companies authorities or not. Nevertheless, it’s suggested by the scientists that employers usually have abilities to control the reasons that motivate employees to leave, the most spread of them are the following:

  • Feeling unappreciated or that his/her contribution is not valued.
  • A lack of growth potential in the company.
  • No help to turn a dead-end job into something more appealing.

If these factors will be taken into consideration with the development of new businesses or it’s expansion in future most of turnover issues can be prevented. It will be much cheaper for the company to hire a human resource manager or skillful psychologist who will hire those who won’t demand job promotion in future and will be loyal if the company’s business looks like slowly developing, than to hire new and new people for some kind of position again and again in definite time intervals.

 On the other hand there can be people who are attached to particular company because they consider it to offer them professional growth and promotion as well as development of their skills and job opportunities. In this case it will be reasonable to organize job trainings and provide them with the job that mostly suits them and answers their qualifications and to be objective in such decisions. It will often be cheaper to spend some money in employee’s qualification investment that will be of a need in future than to ignore his abilities and professional traits, that can result his discharge.

The problem of retaining employees is one of the main concern of many retail companies nowadays. It should be clear that work ethic is changing from day to day, and the demands of nowadays workers differ from those of the 1950s, 70s, and even from those of 90s. The tendencies of the employees demands had changed are defined to be today and tomorrow as following:

  • Balance and synergy
  • Work that is seen as a noble cause
  • Personal growth and development
  • Partnerships
  • Community at work
  • Trust

 There are several approaches to meet these needs that will prevent business from employee “drain”:

  • Provide interesting work that will respond to employees’ talents.
  • Don’t hide appreciation for work done successfully.
  • Encourage employees to be in “shape”
  • Provide opportunities for professional learning and career growth.
  • Provide competitive wages for employees.
  • Organize training for managers to be supportive coaches.
  • Provide a clear mission with personal goals.
  • Build a safer, pleasing and fun working environment.
  • Support opportunities to reasonable experiments in working environment.

 

Real successful practices of retention

T.I.M.S., Inc.

Denis H. Arian and his wife Karen Arian started Technical Information Management

Services, Inc., (T.I.M.S.) in their own house 13 years ago. Over the past decade, T.I.M.S., Inc. has developed into a successful consulting and information technology services company with nearly 40 members in staff and offices in Cleveland, OH and Chicago, IL. Both in the year of 1999 and 2000, T.I.M.S. was awarded Weatherhead 100 and Northcoast 99. It’s purpose is to develop and optimize the most effective business systems that will meet the needs of either companies and their employees or the needs of the customers by the usage of both technological innovations and management strategies and methods.

The primary strategy of T.I.M.S. was process of “hiring right” people first. What they did was the following: they established the atmosphere of partnership with each employee beginning with interviewing and hiring processes. T.I.M.S. introduced and realized in their practices the concept, which is called PASS Program (Performance Appraisal Scorecard System) for performance evaluation using employee’s input as criteria for future success. The core of their strategies was training as an essential part of retention practices.

 According to their methodic it’s very important to devote time for interaction with employee, for finding an individual approach to his concerns and needs as well as stimulate his success.

Mazel Stores, Inc.

 Mazel Stores, Inc. is one of the leading wholesalers of clothing in the USA. Its founder Bill Mazur has been working in this business for more than 30 years as a head of the company, that purchases sells and distributes through their retail outlets or through other store companies from direct manufacturers. Its partners are Newell (Rubbermaid), American Greetings, Ketter Plastics, and Sunbeam, as well as smaller companies such as Marc’s Deep Discount, Family Dollar Tree, and Medic Drug Stores.

The retention need of the company was to find and save employees, most of whom had been facing troubles that would prevent them from being employed by the company in future.

Company’s strategy was based in recruitment using assistance of the professionals in employment business such as Empowerment Zone and the Convictions Fair for its headquarters in Solon. The company’s employees faced troubles with transportation, so the company had to develop and introduce van pool service as well as other transportation solutions to ensure getting to and from work punctually. The company worked with government and municipal agencies to solve and improve employment issues as well as to increase and save employment stability rate.

 The company also practiced hiring part-time psychologists and managers that worked on overcoming barriers and other job related issues faced by the employees.

General strategies for reducing turnover

The best way to reduce turnover and save employees is establishing human resource expertise for business. A human resource manager or organization development (also called OD) expert, who can be permanent employee or employed as an outsourced service provider is able to help company to save its employees through an analyzed and deeply examined approach that includes:

  • Recruitment: sourcing for candidate, testing on job suitableness
  • Compensation: market analysis
  • Benefits: competitive, cost-containment
  • Training and employee development
  • Employee relations: pro-active programs, dispute resolution
  • Performance management systems
  • Organization assessments
  • Legal compliance

 

 

 

Employee selection and training

The selection and training of the employee should be organized in the way so that nearly hired person will meet all the requirements of the business and working environment. As it’s generally agreed a salesperson is a communicator: he interpreters the features of the product into those benefits that will satisfy the customer. And it’s very important to remember that a salesperson is the store representative to its customers.

There is a very specific quality that differentiates a sales person from others involved in promotional activities and it’s an opportunity for feedback between customer and a seller. Only good marketing policy such as advertising and promotion will get customers to the store. The quality of products as well as good sales representatives will keep people coming back to the store again and again.

As the specialists suggest, the importance of right employee choice and their trainings cannot be overvalued or exaggerated. It often happens that retailers are surprised when they find out that salary, which is important for employees, is not of the primary concern for them. Attitudes as fairness, security, honesty, and opportunity are also of the high importance for them.

 

Organization and supervision of business           

Management functions of the retailer business basically include planning on the hand with other as organizing, staffing, leading, and controlling.     Organizing business, the retailer introduces relationships among people, products, goods, and other materials or resources to get a job fulfilled.    “Staffing entails the recruitment and selection of employees. It is a vitally important function because the employees of a store represent that store to the public.  People can really be the most important asset of a retail firm.     Every retailer is in a leadership position.  Leadership means motivating employees to achieve their maximum potential, while at the same time accomplishing the goals of the organization.  Because leadership means understanding people, it is one of the most creative and challenging aspects of a retailer’s job.  The retailer’s professionalism and attitudes set the tone for employees’ attitudes and performance. Controlling is the follow-up function of retail management.  Actual performance is compared with planned performance to spot and evaluate deviations.” (from Charting the course of retail Business available on web http://www.etretailbiz.com/Jan2003/strategy.html)

Financial analysis

 The financial analysis of retail business is very important step in the optimization of the whole functioning of business. First it allows to determine the main priorities for the improvement of management of employee resources, probably reform the personnel policy, cut off or make new workplace and determine whether it’s necessary to spend more expanses on management or to save some money on particular part of business management and to redistribute the finances (to improve labor conditions or increase employees wages).

On of the most innovative and spreading method of retail business management as other sales businesses management is distant organization of work. Top managers and top sales managers use Internet and other means of communication to regulate business, especially if it refers to international companies. The organization of a workplace for one person costs not more than 2-3 thousand dollars, and it’s arranged in employees house. It allows saving a lot of money on rent, property taxes, etc. Those saved finances are redistributed as a result the employees get higher salaries, plus they get more flexible and comfortable conditions of labor that plays a role of additional motivation in their work.

 Another aspect that attracts the attention of specialists in food retail business is concern about investments into online retailing. Even though that some of the major e-commerce consultants and advisors make optimistic prognosis about the potential of online food retailing market, these conclusions are still not very reliable. For example Andersen consulting predicted a market portion of online food retailing to be 20% in the year of 2003. This statistics is used by both Peapod.com and Webvan.com as the foundation for a nationwide investment program with a capital of nearly one billion US$. But the real statistics is very different from that one predicted by Cap Gemini (30-40%) and is approximately about 3% for a total retail sector with only 2.3% for grocery sector.

 In potential it won’t greatly increase in the next five years. Its predicted growth is not more than 3-4% either for the USA or for Europe. So the decisions of some retail businesses to make investments into online retails cannot be considered as the best choices in this situation. It will require to hire new employees, to develop new management strategies and will require a lot of expenses, that won’t bring any desired payment but may result in turnover because of the changed priorities of the company. Joost W. van der Laan highlights the following reasons for that in his article The future of online food retailing:
“…On top of those disadvantages: traditional supermarkets are fighting for consumer loyalty by improving their marketing mix and increasing their efficiency.

Reason 1. In my view online shopping for dry groceries and perishables is boring. It does not even come close to the fun of buying books at Amazon.com or the joy of  assembling your own PC at Dell.com. There is absolutely no advantage here over the weekly trip to the supermarket. I dare you to try it yourself a couple of times, and then convince your partner who is not in the food business or consultancy business. Only when the online business focuses on special products and on rich information content, the consumer will become interested and stay interested.

Reason 2. Online shopping is less time consuming than traditional shopping, but it adds complexity to your lifestyle. Let us assume in an optimistic mood that every “household manager” will master the skill of shopping online. After ordering online you first have to make sure that the goods are properly received at home. Second you often have to go to the store anyway for miscellaneous articles. Third you have to check proper billing and payment. Fourth you have to follow up on orderpicking mistakes and delivery errors.

Reason 3. The distribution costs of homeshopping are twice as high as the costs of traditional food retailing, and most consumers are not willing to pay the extra 15 %. Internet startups will first try to gain market share with low prices and low service fees, but when the shareholders cash is consumed they will have to ask higher than “normal” prices to cover the costs and survive. Of course their is a small niche market for expensive homeshopping services: affluent PC-minded and service oriented consumers and consumers with no easy access to a nearby store.

Reason 4. In recent years Efficient Consumer Response and Category Management had a significant and positive impact on the quality and efficiency of traditional supermarkets. Food retailing has always been a very competitive business, and in recent years super-marketing has become a professional science that is constantly improving the value to the consumer. Both in the USA and in Europe very competitive stores with Every Day Low Prices and high service levels are gaining market share and are making the food business a war zone for new entrants.

Conclusion: the average consumer does not have a good reason to go food shopping online.”

(available on web: http://www.retaileconomics.com/index.htm)

According to the article ULW Effect on Business and Tax Payers:                                           “…Successful companies have been able to draw the line between low employee turnover and high profitability. The line connecting those two dots passes through high employee satisfaction, and high employee satisfaction impacts directly on the customer experience. We’ve already seen how consumers rate quality of service as the most important aspect of their experience with a hotel, and that’s true of many businesses in this sector. Satisfied customers become repeat customers, and when those repeat customers are in the desirable top 20 percent, profitability inevitably improves…Henry Ford, the father of the American automobile, was facing exorbitant retraining costs due to high employee turnover. He was being forced to replace every employee four times per year. He also found that absenteeism was at an equally unacceptable level. His response was to almost double the daily wage of his workers to $5.00/day.

* The immediate result was:

1) significant reduction in employee turnover,
2) significant reduction in retraining costs,
3) significant reduction in unscheduled absenteeism,
4) and almost complete stoppage of internal theft (roughly 50% of the theft in today’s retail world is committed by its own employees).3 Furthermore,
5) he created a true economic stimulus resulting in a business boom for his own company when his workers put discretionary funds right back into his company as purchasing consumers.4
*All of these savings/benefits are possible today with the enactment of the Universal Living Wage.” (available on web: http://www.nationalhomeless.org/globalization/2.html)

Building HR expertise

It is of a high concern that in majority supervisors and managers are generally not evaluated on employee turnover levels. If to refer to a COSE survey of retail business (April 2003), only 20

percent of respondents applied the use of a specific target or measure in evaluations. Although

26 percent marked that they “informally” used turnover statistics as a part of evaluations that shows what a great number doesn’t consider it to be an important part of manager’s job.

 In ideal all managers should also be able to work as  “HR managers.” However, the participation of a real “expert” is important to be developed – the participation of someone with specific HR responsibilities, who would be part-time HR or OD specialist.

Employee opinion survey

One of the most important and essential issue for the discussion between the retail human resource executives is an employee opinion survey. An objective survey conducted by the HR manager will truthfully describe the working environment of the company and will direct the further work of the manager on solving of job related issues, that will help to improve motivation and working process as well. The importance of the survey is quite obvious. It’s cheaper and more comfortable and even more safer and reliable for business to make changes in management policy using the data provided by the employees themselves, than to try to solve coming issues relying on experiment and manager’s personal experience, even if it’s an experience of a skillful and highly qualified professional. As the effective employee survey process can be an essential, high-ROI tool for store morale improvement, improvement of customer service, reduction of turnover and introduction of new ways and means for communication and interaction.

  The Retail Survey Group made long-term researches and studies in the field of job related relations in retail business and had developed the following methods of making an effective and objective successful survey. It introduced eight important keys to the success of the survey:

  1. In most cases, an employee survey should be perceived as an operations- driven initiative rather than an HR department program.

Companies that differ by high organization of the survey processes put it on the high priority when it’s needed to gather opinion. Even so that making the survey is job of HR center or HR manager that works in the company, the survey made from the name of the head of the company always gets a higher feedback and is more objective, because it’s treated by the whole management chain from the tops to the bottom line of the company. The experience of The Retail Survey Group shows that the employee’s psychology is more likely to pay more attention to the job authorities than to the human resource center, which is made for these perporses. But the job to analyze the results of the survey is human resources center primary.

  1. Your goal for response rate should be 100%.

 The problem with lower respond rate is not just that it can not give an accurate picture on the questions asked in the survey. The low respond rate for large businesses with more than a 1000 people employed won’t draw an objective picture, but can be valid for small selling departments or stores, but still the statistics can be not as accurate as it’s desired. Moreover the respond rate of the employees determines their ability to draw and determine the answers on the questions about working environment. Once being determined these issues will be also desired to be solved by the employees themselves as well as by the management department.

In this case the results will be more fruitful because both sides who participate in this process will be determined with their choices.

As the Retail Survey Groups states:

“Surveys are deemed successful when one or both of the following occur:

  • One or two large-scale organization-wide improvements are made as a result of having conducted the survey.
  • A “critical mass” of smaller-scale improvements happens throughout the organization, based upon department- and store-level improvement efforts.

While a single year’s survey effort may have been made worthwhile by virtue of the first

reason, a survey becomes a valuable ongoing management tool usually by virtue of the second.”

By their words : “The best way to get an acceptable response rate, i.e., one that is certain to yield accurate reports

down to the department level, is to make survey participation an expected occurrence, and to set

up an administration procedure that makes this a reality.”

  1. A survey for retail employees should take less than 10 minutes to complete.

The research had determined that both the questionnaire size and the method of its administration influence on the results of the response rate and on the objectiveness of its quality. As the questionnaire’s purpose is to get an accurate data, it is believed that long questionnaires that take a lot of time to be completed provided not accurate data and have lower response rates. The benefits of short 5-10 minutes survey are basically in their easy administration and no time loses.  They can be easily administered during the breaks or before the meetings. It’s very comfortable because no special arrangements are required. There are experiences with companies that spent more money on the administration of the survey that had to be taken after the working day and that took nearly 30-45 minutes. But the results were not that much different from those short-time surveys and even often were not responded properly.

  1. (Good) Norms are important.

As soon as the results of the survey are analyzed it appears another task that faces the organization and is addresses to the issues and problems that found reflection in the survey. It’s the essential part of the survey process. And as a result the company has to determine correct improvement areas in order to get the most effective and fruitful return from the survey. The set of norms for survey’s data give an opportunity to compare the effectiveness of the company to the similar businesses that are held by other companies.

The Retail Survey group gives the following example: “consider the case of a supermarket chain that has conducted its first-ever company-wide employee survey. Senior management is reviewing the results, trying to figure out how they will allocate their resources toward making improvements. Let’s assume that they get what appears to be a fairly high score on workplace safety and a fairly low score on developingemployees for future promotions. Without the benefit of normative data to tell them how other supermarkets faired on those items, they might decide not to do any work to improve the safety item, and instead focus on the development item.

Had they had access to a good retail norm base, they would have seen that the safety item

typically receives a very high score, and that their score was significantly lower than the

norm, indicating a potentially serious problem.

Conversely, the item regarding development for future promotions is typically among the lowest

scoring items on the survey. In fact, their score on that item places them in the upper quartile of

the norm base.

 Of course, the money they put toward further work on development might well pay dividends,

because it is such an important item. And improving the promotional process might cement

their image as a great company for which to work. However, relative to the safety item, it

might not be as critical to target for immediate improvement.”

  1. Each store should get a report detailing its overall results and the results of its major departments.

Many companies make the fault of not disseminating the outcomes to the store level. By the view of The Retail Survey group, this greatly diminishes the chance that the survey will be successful. First, as has already been marked, surveys are most effective when they are the impulse behind change efforts undertaken at the store and department levels. Only by getting direct access to the results of the survey employees can begin to take part in the action planning process.

Second, keeping the results within the restrictions of senior management can easily be understood as a breaking of the social contract common in most employee-based feedback systems. The representatives of The Retail Survey Group state that “for reasons beyond the scope of this paper, employee surveys are assumed to be closed-loop feedback systems. The loop begins with the employees filling out a survey form. Next, the survey forms are tabulated, and their collective opinions are shared with management. To close the loop, management must in turn share the collective results with the employees. If this loop is not closed, employees are left with a sense of unmet expectations. It is similar to the feeling one gets when applying for a position and then never hearing back about it one way or the

other.”

 It often happens that employees know very little about the results of prior surveys and they think about them the following:

  • “The results must have been so bad they were embarrassed to publicize them.”
  • “They can’t tell us what they found because then they’d have to change things.”
  • “They just did the survey to make us feel like our input was important…they could care less how it turned out.”

With the exception of special circumstances, the Representatives of Retail Survey Group advocate that employer share with all employees an

item-by-item comparison between the results for their store and the results for the overall company. For most employees, this constitutes a full and deserved disclosure of the results, and it is a great way for employees to begin to get a handle on what the results mean. Once employer has done this, he would have set the stage for store-level action planning.

  1. Anyone who completes a survey should be able to understand a survey report.

If you employer is going to share the results of the survey with store employees, he needs to present them in a report format that is easy to be looked through. Some people understand statistics and numbers better others easily catch the graphs and charts. The Retail Survey Group recommends that results be presented in a combination of these ways, but most of all in a order that is simple and understandable.

It should be understood that the goal of the survey is to enlist the help of the employees in analyzing the survey results.

The author of the survey wants employees to be excited about the potential insight they have into the results of the survey, because they were the ones who gave the feedback. They also have ideas about how to arrange and change things for better.

  1. Give those responsible for creating action plans some basic ideas to use as starting points for their plans.

“Imagine that came the most critical point in the survey process…the point at which store and

department managers are sitting down with their employees, report in hand, with a good

understanding of the results and having selected a few problem areas to target for improvement.

The group is ready to create action plans. The store manager is at the flip chart…her marker is

poised…and then it strikes the group that no one has the faintest idea about what a good action

plan looks like, let alone how to go about creating one.”

 This is considered to be the point where many surveys lose their value and significance, which is quite understood.

Most retail store managers don’t have any training or knowledge about working with a group to present and discuss an improvement plan. “To make matters worse, consider the following Survey Research 101 axiom: Managers at stores with the lowest employee survey scores are the very managers least likely to be able to facilitate a productive action planning session. In other words, those stores most in need of good post-survey action plans are the ones least likely to succeed in creating them. Fortunately, it is not that difficult to provide managers with the tools they need to write effective action plans. The easiest way to do so is to provide them with a template for the format and content of their plans. For example, our firm provides clients with an Action Planning guide, which not only offers store managers a step-by-step guide to action planning, but also suggests several actions for each topic covered by the survey. It is easy to use these ideas as the starting points for the group discussion, and to transform them into high quality action plans.”

  After all, if there is an essential  role for the Human Resources department during the survey process, it is to determine store managers most in need of help with action planning, and to offer

them the help they need to do the work properly.

  1. The organization should commit to a follow-up survey even before the first one is administered.

  Companies that fully use the surveys they administer usually treat them as a part of a cycle. Each finished survey is considered to be a benchmark for the next one. The data reflected in the survey describes the condition of company’s finances, employee environment and indicates the “working” health of the company. It can be used to primary predict and take measures to prevent turnover issues and job related conflicts. Managers also rely on the surveys as on the sources and guidance for finding a common language with employees. Employees also consider the administering of the survey to be a good sight from the side of companies authorities to get the opinion about inner life of the company and its functioning.

  But for such successful monitoring the company had to start with a successful survey that will definitely bring results. From the beginning of survey introduction into the practices of the company managers have to think about an employee survey program or survey process rather than about one-time employee survey that will stand alone.

Conclusion

As it was discussed the turnover employee rate causes a lot of troubles for retail businesses as well for other businesses. The expenses spent on hiring new employees are often as high as the monthly wages of the employees, but at the same time the absence of the worker causes work disorder and losses of clients.

   Nowadays the problem of saving workplaces is very actual and attracts a lot of attention from the side of managers, who propose different strategies to stabilize personnel activities and improve working environment. These strategies include individual approach to the employees, encouragements, surveys, and special management techniques.

 As it was stated above, very often the financial side of the job is not of the main concern for the employees. It’s understood that the salary means a lot, but appreciation, encouragements, benefits and other rewards the employee gets while working are of a high value as well. Still most of them also have any relationship to finances.

  That’s why it’s quite important to make business efficiency monitoring and find new solutions for its optimization. Saving money on some ineffective investments and redistributing them to increase the salaries, social benefits and educational opportunities for the employees will increase their motivation.  It may refer to their transportation issues (organization of the transportation services for employees who really need that), improving working conditions (introduction of the new equipment and organization of special training programs for workers). It’s understood too be quite expensive, but the results that these innovations will bring in future will definitely cover all the expenses. (It’s quite enough to estimate how much will be the transportation service organization for people who live in the same area and how much do they spend on parking and gas a day. Or it’s enough to figure out how much useless work does an accountant or a manager using old computer software or even worse just pen and paper. It’s easy to understand how these trainings will optimize his work will save him time and of course will save employer’s money).

     Appreciation of the employees is really important; especially it’s very necessary for the core of the company’s team, for people who are in company’s business for years and who are the most valuable. Before doing any changes it’s necessary to consult those employees and to take into consideration their opinion. At this point it’s quite important for human resource managers to administer employee opinion surveys that will draw the priorities for future management changes and better organization of the work.

 Every case is very special and needs a search of individual approach. But the methods that were discussed above had recommended themselves as successful and can be used in management practices worldwide.

List of references

1.”The future of Food Retailing: e-Commerce and other Predictions“, Prof. Dr. Edward McLaughlin of Cornell University, presentation “State of the Art in Food”, January 2000.

2.”Internet Retailing“, Henk Gianotten of EIM, Food Personality, February 2000.

3.”Futurize your Enterprise“, David Siegel, John Wiley & Sons, Inc, New York, 1999.

4.“The future of online food retailing” Joost W. van der Laan ,”Journal of Marketing”, February 2000 and “Food Personality” ,August 1997

  1. “Erasmus Food Management Institute” rapport on E-marketplaces, January 2001

  1. “Marketing Logistics”, Martin Christopher, Reed Elsevier, 1997

  1. From Supply Chain to Collaborative Network”, Gordon Anderson, Bruce Walton, Andersen Consulting, 2000

  1. “Eight keys to a successful employee survey” The Retail Survey Group, 2001-2002 (available on web: www.rsg.com)

  1. “Charting the course of retail business” Article (available on web: http://www.etretailbiz.com/Jan2003/strategy.html)

  1. To Cut Employee Turnover, Don’t Change Anything” ,Louis Rovner, Ph.D. Article (available on web:http://www.drilleronline.com/CDA/ArticleArchiveSearch/1,5692,,00.html)

  1. “Globalization and Labor — Part 2” Article (available on web: http://www.nationalhomeless.org/globalization/3.html)

  1. “Taming turnover: A Strategic advantage for business” Article (available on web: www.cose.org/PDF/WLA/Taming_Turnover.pdf)
  2. Store Wars:  How Retail eCommerce Executives Can Win the Battle for the Last Aisle

Four Tips for Success for In-Store Digital Merchandising & Customer Self-Service” , Richardson,Alex  Article (available on web: http://www.kiomag.com/informermj04)

  1. “Leading the quick service and food retailing industries” Kay Division, 2004(available on web: http://www.ecolab.com/Publications/FactBook/Kay.pdf)
  2. “Work Environment More Important to Employees Gregory P. Smith (available on web: http://www.businessknowhow.com/manage/workenv.htm)
  3. “High employee turnover raises safety concerns” Ledyard King, Article Gannett News Service  (available on web: http://www.usatoday.com/news/washington/2001-02-26-airportsafety.htm)
  4. Reducing Turnover” Article (available on web http://www.accountemps.com/AT/ReducingTurnover)

 

18. “Calculating the High Cost of Employee Turnover”  Yves Lermusiaux (available on web: http://www.ilogos.com/en/expertviews/articles/strategic/20031007_YL.html)

Cite this page

How to solve high employee turnover rate in a retail company or retail business?. (2017, May 10). Retrieved from https://studymoose.com/how-to-solve-high-employee-turnover-rate-in-a-retail-company-or-retail-business-essay

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