Rethinking Retail: The Story So Far
Promotion Management
For an industry which is fairly troubled by attrition,
firms today have started looking at talent management
of store employees seriously. It is expected to bring in
double benefit; it will help firms to manage attrition and
also at the same time identify individuals who are high
performers and differentiate both on role and pay. Some
forward-looking firms have also started using formal
assessment test as a promotion tool. It is an established
fact that role promotion means more than just higher
revenue/sales numbers. It includes many softer aspects
like people management, team management, solutioning,
etc. Firms are adopting these tests to ensure, individuals
with the right tangible and intangible skills are promoted.
On an average, stores promote 9% of its employees.
If we break this across levels, the promotion numbers
look as follows:
Unlike stores, majority of the promotions in corporates
happen annually during the salary revision period.
On an average, about 8.5% employees across levels of
management get promoted at the corporate level.
The Need for Change
India remains an appealing and long-term destination for
several reasons. The demographic dividend of having the
youngest population in the world with growing middle
class disposable income is expected to pay off. However,
with changing times, retail is also looking at managing
its show differently. Not so long ago the e-commerce
revolution hit the conventional retail format. Competitive
pricing, different payout methods and just the novelty of
using this channel has created a dent in the store based
retail unit.
To add to this, the cost-based pressure of less than
encouraging business results, high level of attrition, lack
of trained retail professionals and high cost of training
has only made business difficult.
To cope with all these changes retail needed to
adapt, and adapt quickly. In a very short span of time,
retail firms have shown a lot of agility in how they are
looking at managing business in India. While business
management can be discussed at length, what is
interesting to note is that now HR is looked at as an
instrument for driving change and is gaining incremental
value.
Rewards management took the center stage, where
HR looked outside-the-box on how the operational cost
can be curtailed without impacting the engagement of
its top performers. Companies have increasingly
transitioned their HR strategies to be more performanceoriented
and have structured programs that drive better
differentiation between the performers and laggards.
It is initiatives such as these which will hold retail
companies in good stead, as the headwinds continue to
get stronger, and character and conviction in how they
manage the people challenges will define future success.
|