One of the biggest assets of the brick and mortar retail industry has been its ability to have a human connect with customers. The right interpersonal interaction with sales associates can result in engaged customers – the kinds who keep returning back to the store. And which retailer would not like to see this kind of audience in their outlets?
Except, there is a snag in this seemingly jaunty narrative. And it has to with the challenge of managing the human resource in retail companies.
According to National Skills Development Corporation (NSDC), the retail sector engages 43 million employees in the industry, making it the second largest employer in the country, providing over 10% of all formal jobs. According to NSDC’s report, India will need over 56 million skilled workers by 2022 in order to support the booming retail sector growth, which is expected to touch $1 trillion by 2020.
While the sector has a wider employment base, retaining and engaging its workforce has remained a big challenge. This is also pertinent because capable and resourceful staffers help in the creation of fully engaged customers. As per a Gallup CE3 survey, these customers represent a 23% premium in terms of share of wallet, profitability, revenue and relationship growth over the average shopper.
HR PUSHES THE ENVELOP
HR practices too have evolved significantly to attract, retain and train talent in retail. It has transformed from being merely an operational and support function to occupying a more strategic role in organisations.
The HR team undertakes regular training programs, employee performance valuation and timely appraisals to buoy employee morale. “We have started mentoring and giving timely feedback to employees, so they feel valued. We normally don’t encourage people working extra hours after their duty. We encourage them to take leaves so that they can maintain a work-life balance. We have also introduced an open forum where employees can raise their concerns,” said Ashish Vaidya, HR Head of Infiniti Malls.
It is also important to impart a sense of ownership amongst employees to reinforce their emotional connect with the company. Richa V Kalra, founder of Candyskin added, “Hosting training programs, quarterly review and other internal meets, monthly target achievement updates, giving them ownership so there is loyalty and employee advocacy, incentive based jobs with base salaries.”
A BIT OF PLAY GOES A LONG WAY
Employee retention is a combination of good work culture, employee engagement initiatives and a transparent incentive mechanism. Talking about this, Mahesh M, CEO of Pune’s Creaticity said, “In an extremely dynamic environment influenced by technology, where the customer is often more well-informed than before, multiple cues from interactive kiosks to virtual reality, from-app based information availability to comparison engines, the role of retail salesperson in specific is undergoing transformation.”
This is where they are using concepts like gamification. This concepts takes the attributes one would normally associate with games — like fun, play, interaction, competition, play and transparency — and then applies it to HR processes, including recruitment, training programs, development and even appraisals.
“At Creaticity, we stress on inculcating our values into the team from obsess about customer to bias for action. Constant motivation through—shabaash cards—for even small wins and service awards for completing milestones as one or two years help in retaining good quality talent,” said Mahesh.
Deloitte, in its report titled ‘Surfing Tides of Retail Change-A Talent Perspective’ noted that it is important to have attractive employee engagement strategies in place, such as gamification of work, achievable sales goals and commission structures, extra time-off and other exciting variable incentives.
“Although talent has always played a major role in retail, the latest research shows that talent management is fast becoming a primary driver for organizational success. Companies that spend 3.5% to 4% of their operating budget on workforce development are also in the top 5% to 10% of the best performing companies within retail,” the report remarked.
Going ahead companies are also offering additional benefits to enhance employee engagement. For example, Infiniti Malls plans to provide comprehensive insurance policy covering accidental and natural death and total or partial disablement. “We are planning to give higher coverage under the Group Medi-claim Policy which is already in place. The company is also in the process to start Employees’ Co-op. Credit Society so that employees can save money at the same time employee in need of money in contingency can get a loan at low interest rate without a guarantor,” said Vaidya.
Creating an engaged talent pool
THE SKILLING GAME
Competitive and economic pressures are compelling retailers to differentiate themselves through their people while delivering better return on investment in human resource. In addition, the ongoing digital transformation in retail sector has made a paradigm-shift, when it comes to talent management.
According to the Deloitte report, distinct approaches to digital have talent implications, since organizations with a more robust digital model are likely more capable of attracting, engaging, and retaining talent. “Although only 26% have the readiness to go digital, leaders do understand the importance of developing and adopting sophisticated technology in retail,” the report noted.
Vaidya said that HR managers are gradually transiting into being strategic data managers, guiding and managing the information flow to ensure that employees have access to the right data at right time with minimal disturbance. “The role of HR is shifting from managing bureaucracy to managing business assets, talent management and information is resource for this. Cloud systems offer several advantages to companies, including more capacity, higher speed, and tightened security, all of which are driving this growing trend,” he added.
- Pradeep Pandey
Key talent management practices