HR failings contributed to retail slump

by 15 Dec 2011

HR is failing to engage retail workers, and this has had a damaging impact on business throughout 2011.

The full brunt of tough economic conditions has been acutely felt by the retail and manufacturing sector this year, and new research has indicated that one reason Australian retailers have suffered is due to severely low of levels of staff engagement.

The Mercer What’s Working survey revealed that Australian retailers are failing to make the most of their workforce – just 42% of respondents felt their organisation actively tries to retain their staff.

Of the 71% of non-managerial respondents, less than half felt their manager played an active role in assisting with their career development.

Rob Bebbington, Mercer’s human capital business leader Australia and New Zealand, said that failing to engage workers and providing inadequate motivation for staff is a risk most retailers cannot afford to take. He added that the failings stem from the most basic tenant of the retailing industry: customer service.

Customer service and staff engagement are critically linked, because engaged staff will offer above-average service to shoppers.

“Happy staff means happy customers. Without properly engaging with current workers and providing employees with adequate career opportunities, any hope for growth will be thwarted by disengagement and apathy and will ultimately impact retailer’s bottom line,” Bebbington said.

Mercer said it’s clear retailers can no longer compete on price alone – instead the new battleground will be to maximize their customer service levels to give their business the winning edge.

According to Bebbington, employers need to reevaluate their strategy for maximising engagement, and apply a strategy that incorporates innovative ideas to help improve engagement, performance and productivity.

Key findings from the What’s Working survey included:

• Less than half of respondents have been part of a formal review in the past 12 months.

• 52% don’t feel senior management are doing a good job of confronting issues before they become major problems

• Almost 50% don’t trust management to communicate honestly.

• Retail employers are failing to provide appropriate benefits to women who indeed make up the majority of the workforce: 84.1% of employees are unhappy with childcare support and 83.3% are dissatisfied with employee assistance plans.

Bebbington offered the following five tips to retail managers to motivate staff and increase productivity in the lead up to a busy festivity season:

Ask employees for suggestions - let them comment anonymously through a suggestion box. Read employee suggestions regularly, and implement any logical ideas the company can afford.

Cross-train – helping to develop the skills of all employees and raise engagement within the organisation. Workers may feel more enthusiastic towards their role or decide to utilise these new skills for an alternative position within the organisation, increasing staff retention.

Find ways to reward employees through recognition - make this meaningful by adding an extra day off, a gift certificate or an inexpensive gift.

Present company challenges publicly when possible – helping to improve internal communication and allows workers the opportunity to suggest potential solutions.

Provide all employees regular feedback – this should include job performance, providing an opportunity to self-critique areas for improvement. By allowing employees to set individual goals organisations will see an increase in their motivation to achieve them.


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