Retailing Management Study Set 4
Quiz 9 :
Human Resource Management
Human resource management is particularly important in retailing because employees play the major role in performing retail functions. In many manufacturing firms, capital equipment (machinery, computer systems, and robotics) is now used to perform jobs employees once did. But retailing and other service businesses remain labor?intensive. Retailers still rely on people to perform the basic retailing activities such as buying, displaying merchandise, and providing service to customers.
Human resource management can be the basis of a sustainable competitive advantage for three reasons: (1) First, labor costs account for a significant percentage of a retailer's total expense. Thus, the effective management of employees can produce a cost advantage. (2) Second, the experience that most customers have with a retailer is determined by the activities of employees who select merchandise, provide information and assistance, and stock displays and shelves. Thus, employees can play a major role in differentiating a retailer's offering from its competitor's offering. (3) Finally, these potential advantages are difficult for competitors to duplicate.
Retail organization structures differ according to the type of retailer and the size of the firm. For example, a retailer with a single store will have an organization structure quite different from a national chain. ?Owner?managers of small stores may be the entire organization. Coordinating and controlling employee activities is easier in a small store than in a large firm. The owner?manager simply assigns tasks to each employee and watches to see that these tasks are performed properly. Since the number of employees is limited, small retailers have little specialization. Each employee must perform a wide range of activities, and the owner?manager is responsible for all management tasks. If sales increase, specialization in management may occur when the owner?manager hires management employees. ?In contrast to the management of small retailers, retail chain management is complex. Managers must supervise units that are geographically distant from each other. ?Vice presidents responsible for specific merchandise, store, and administrative tasks report to the chairperson and president. In most retail firms, the chairperson and president work closely together in managing the firm. They are frequently referred to as principals or partners. One member of the partnership is primarily responsible for the merchandising activities of the firm--the merchandise, stores, and marketing divisions. The other partner is primarily responsible for the human resource, distribution, information systems, and finance divisions. ?Most managers and employees in the stores division work in stores located throughout the geographic region. The distribution center employees and managers work in one or two distribution centers in the region. Senior executives and the merchandise, marketing and human resource division employees work at corporate headquarters.