The evening talk for the month of November 2018 organized by NIPM Karnataka chapter at Hotel Capitol Bangalore, was on the topic of the unique challenges encountered by HR operating in retail.The distinguished expert invited to share his experience and insights was Mr B. Venkataramana, President- Group HR, of the Dubai based Landmark Group. He has over 15 years of experience in retail.
The Landmark Group started the first store of Lifestyle International Pvt. Ltd in India in 1999. Lifestyle International Pvt Ltd. retails apparel, footwear, handbags, fashion accessories, beauty products, and other products for women, men, and kids in India.The Group’s business in India has since expanded to include Home Centre, Max, and Easybuy. The company has around 40 Lifestyle stores /departmental store chain; 85 value fashion stores under the brand Max and 16 home products stores under the Home Centre brand.
The speaker's exposure to the retail business began when he joined Reliance Retail in 2005 as the seventh employee of the company. He related a story from that period to drive home the fact that retail is a different ball game altogether. In October 2005, the Chairman Mr Mukesh Ambani had confidently declared that he would be investing Rs 25000 crores in Reliance Retail and that he expected to earn 100,000 crores on the investment.However, this was not to be. The company did not do as well as expected; in view of the losses, the actual investment had to be scaled down from what was originally planned.
The company also had to deal with protests from various quarters. The middlemen did not like the idea of making available products directly from the producer to the customers, cutting them out.Mr Venkataramana said that one thing that cannot be wished away is the local kirana/provision shops, the friendly, owner manned, general stores which would continue to be patronized by the regulars. The entry of the E commerce companies have also affected the prospects of the organized retail sector. In spite of these factors, the retail business in India continues to be attractive when compared to the saturated retail markets in developed countries. As against 90% penetration abroad, in India it is only 8%, meaning there is a lot of opportunity for growth.
The Challenges of HR
Mr Venkataramana said that 85% of the 22,000 persons employed by the Landmark Group in India are the front line staff whose education is between 10th and 12th class. He described them as the brand ambassadors and pillars of the company. Taking into account the many indirect employees who sell Lifestyle products, around forty to forty five thousand employees are being managed by HR. The speaker said that the biggest challenge is the high attrition rate amongst the employees. At the time of his joining the company, it was as high as 90% which was gradually brought down to 35% in 2017 and is presently at around 23%.The industry average is still at a high 50%.
The speaker then discussed the steps taken to motivate and excite employees to give their best. He said that initially HR reported into finance and more of an admin role was expected. The engagement level of employees was around 59%. However, on his joining, he got the full support of the top management. He made a presentation to the board outlining the action that needs to be taken and the amount of investment required in this regard. Subsequently a number of processes were put in place that included a lot of training, Gamification (application of game-design elements & game principles in non-game context to leverage people's natural desires for socializing, learning, mastery, competition, achievement etc.) and use of theatre techniques to drive home the importance of appropriate behaviour at work. These exercises contributed to educating, entertaining and engaging employees.
Celebration of the Retail employees' day is another important initiative for enthusing employees and motivating them to stay with the company. Each store is given a budget of Rs 50,000 for the celebration. On the D day, the managers line up in the front to welcome the front line staff as they come in. Gifts are given to employees every year during the Diwali festival.
Two important employee development initiatives were introduced in the name and style of LIFE and LEAP. The LIFE program encourages employees to Learn - Implement - Fastrack - (become) Expert. Along with the LIFE program, the LEAP program also provides technical and soft skills to the front end employees. On successful completion of the course, they earn a degree in Retail management which makes them eligible for a managerial role in future. Employee appreciation schemes were devised and awards given in the name of "the Lifestyle People Oscar Awards", "Clash of Icons" and " Make a difference" awards.
Long hours and the seven day working pattern of the retail industry has been a matter of heartburn and cause of the high attrition in the industry.This problem has been addressed by the company by making available flexible working hours and opportunity to take leave. This is done by scheduling and providing for ten percent excess manpower to cater to the flexi and leave requirements. Further, employees are persuaded to take leave during off season so that they spend more time with the family and have a work- Life balance.
In order to underscore the importance of engaging employees, 30% weightage,( based on the engagement survey score card), has been given in the performance appraisal of managers. As a result in every store or department, executives have taken more initiative for engaging with employees. They are making sure that employees grow. They are also encouraging employees to utilize the schemes discussed above to enhance their competency and qualification. If an employee has served for one year in the company he will be required to pay 50% of the cost of the Retail management course, rolled out in collaboration with IGNOU.
However, If he does the course after completing two years of service in the company, the 50% fee spent by him is paid back to the employee .In case he has completed the course and served for a period of 3 years, Rs 70000/ is paid as bonus. Thus the scheme has proved to be a good retention strategy. The company also has an executive development program under which executives are deputed for learning programs at IIM Calcutta and Ahmedabad. They are also deputed to international destinations to understand the latest trends in fashion abroad and also understand international markets.
Although the majority of the employees of Landmark Group in India are the front end employees, the other key personnel are the warehouse staff and those working for the apparel business for which recruitment is done from topnotch institutes. The company is the highest recruiter of students from NIFT (National institute of fashion technology). The company focuses on developing capability and creating a pipe line with the help of methods like the development centres. The future potential leaders are categorized as A,B and C with provision for fast track for the stars. The company has a robust E learning management system through a tie up with Litmos. The intranet is also very strong in the organization. The company has also gone in for a lot of digitization.
Presently, there are 250 employees working in the company for the HR function.The diversity ratio of women employees have risen from 9% to 22%. In the engagement survey "safety of women in the workplace" got a healthy score of 95%. There is zero tolerance to sexual harassment in the work place. Further, in a company that has a lot of buying and other activities, the whistle blower policy is also very strong.(A whistle blower is a person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organization ). Venkataramana said that Titan, Infinite retail Ltd, McDonald's, Shoppers Stop and others are in the race with the company for a "Great place to work" in retail. ( Readers may like to read my earlier blog on "Great Place to Work- https://hrdian.blogspot.com/2018/10/the-journey-to-becoming-1-in-list-of.html )
Question-Answer session
Question: During festival time the queues can be very long and frustrating. How do you ensure that your front line staff who are educated only up to plus two, handle the pressure effectively?
Answer: We try to reduce the rush at the billing counter through steps such as self billing process and managing the mobile process. Further, the cashiers are given adequate training. The time taken on each transaction is measured.
In the interactive sessions, case studies are discussed on subjects such as integrity, customer satisfaction and how to enhance the customer experience. If the store does well, high incentives are paid.
Question: In view of the increasing automation, do you envisage loss of jobs in retail?
Answer: The automation in retail in India is only 10%. Hence it would take a while for it to have a big impact. Further, in view of low wages of manpower in India, it is still attractive for companies to employ people and this is not likely to change in the near future.
Question: How successful has been your engagement activities?
Answer: Under the scheme for employee development, 910 employees became graduates and have become eligible to become store managers. The success stories of people who have reached heights in the company are shared with new recruits during induction.As mentioned earlier, our attrition rate has come down drastically and is one of the best in the industry.
The millennials have very high expectations and are very different from earlier generations. Our challenge is to realistically prepare them for what to expect in the retail business. As for example they may come in with the expectations of working in an air conditioned environment of ease and comfort.We explain to them the real life out there would require hard work and "dirtying your hands". 40 to 45% of the attrition happens within the first 90 days of joining.
Mobile is going to be the way forward and we can use it effectively for learning needs in future.
As a means of handling stress, we expose the employees to Zumba dance ( Zumba is a dance form with aerobics fitness program created by Colombian dancer and choreographer Alberto "Beto" Perez during the 1990s) and AOL (Art of Living- meditation).
The Landmark Group started the first store of Lifestyle International Pvt. Ltd in India in 1999. Lifestyle International Pvt Ltd. retails apparel, footwear, handbags, fashion accessories, beauty products, and other products for women, men, and kids in India.The Group’s business in India has since expanded to include Home Centre, Max, and Easybuy. The company has around 40 Lifestyle stores /departmental store chain; 85 value fashion stores under the brand Max and 16 home products stores under the Home Centre brand.
The speaker's exposure to the retail business began when he joined Reliance Retail in 2005 as the seventh employee of the company. He related a story from that period to drive home the fact that retail is a different ball game altogether. In October 2005, the Chairman Mr Mukesh Ambani had confidently declared that he would be investing Rs 25000 crores in Reliance Retail and that he expected to earn 100,000 crores on the investment.However, this was not to be. The company did not do as well as expected; in view of the losses, the actual investment had to be scaled down from what was originally planned.
The company also had to deal with protests from various quarters. The middlemen did not like the idea of making available products directly from the producer to the customers, cutting them out.Mr Venkataramana said that one thing that cannot be wished away is the local kirana/provision shops, the friendly, owner manned, general stores which would continue to be patronized by the regulars. The entry of the E commerce companies have also affected the prospects of the organized retail sector. In spite of these factors, the retail business in India continues to be attractive when compared to the saturated retail markets in developed countries. As against 90% penetration abroad, in India it is only 8%, meaning there is a lot of opportunity for growth.
The Challenges of HR
Mr Venkataramana said that 85% of the 22,000 persons employed by the Landmark Group in India are the front line staff whose education is between 10th and 12th class. He described them as the brand ambassadors and pillars of the company. Taking into account the many indirect employees who sell Lifestyle products, around forty to forty five thousand employees are being managed by HR. The speaker said that the biggest challenge is the high attrition rate amongst the employees. At the time of his joining the company, it was as high as 90% which was gradually brought down to 35% in 2017 and is presently at around 23%.The industry average is still at a high 50%.
The speaker then discussed the steps taken to motivate and excite employees to give their best. He said that initially HR reported into finance and more of an admin role was expected. The engagement level of employees was around 59%. However, on his joining, he got the full support of the top management. He made a presentation to the board outlining the action that needs to be taken and the amount of investment required in this regard. Subsequently a number of processes were put in place that included a lot of training, Gamification (application of game-design elements & game principles in non-game context to leverage people's natural desires for socializing, learning, mastery, competition, achievement etc.) and use of theatre techniques to drive home the importance of appropriate behaviour at work. These exercises contributed to educating, entertaining and engaging employees.
Celebration of the Retail employees' day is another important initiative for enthusing employees and motivating them to stay with the company. Each store is given a budget of Rs 50,000 for the celebration. On the D day, the managers line up in the front to welcome the front line staff as they come in. Gifts are given to employees every year during the Diwali festival.
Two important employee development initiatives were introduced in the name and style of LIFE and LEAP. The LIFE program encourages employees to Learn - Implement - Fastrack - (become) Expert. Along with the LIFE program, the LEAP program also provides technical and soft skills to the front end employees. On successful completion of the course, they earn a degree in Retail management which makes them eligible for a managerial role in future. Employee appreciation schemes were devised and awards given in the name of "the Lifestyle People Oscar Awards", "Clash of Icons" and " Make a difference" awards.
Long hours and the seven day working pattern of the retail industry has been a matter of heartburn and cause of the high attrition in the industry.This problem has been addressed by the company by making available flexible working hours and opportunity to take leave. This is done by scheduling and providing for ten percent excess manpower to cater to the flexi and leave requirements. Further, employees are persuaded to take leave during off season so that they spend more time with the family and have a work- Life balance.
In order to underscore the importance of engaging employees, 30% weightage,( based on the engagement survey score card), has been given in the performance appraisal of managers. As a result in every store or department, executives have taken more initiative for engaging with employees. They are making sure that employees grow. They are also encouraging employees to utilize the schemes discussed above to enhance their competency and qualification. If an employee has served for one year in the company he will be required to pay 50% of the cost of the Retail management course, rolled out in collaboration with IGNOU.
However, If he does the course after completing two years of service in the company, the 50% fee spent by him is paid back to the employee .In case he has completed the course and served for a period of 3 years, Rs 70000/ is paid as bonus. Thus the scheme has proved to be a good retention strategy. The company also has an executive development program under which executives are deputed for learning programs at IIM Calcutta and Ahmedabad. They are also deputed to international destinations to understand the latest trends in fashion abroad and also understand international markets.
Although the majority of the employees of Landmark Group in India are the front end employees, the other key personnel are the warehouse staff and those working for the apparel business for which recruitment is done from topnotch institutes. The company is the highest recruiter of students from NIFT (National institute of fashion technology). The company focuses on developing capability and creating a pipe line with the help of methods like the development centres. The future potential leaders are categorized as A,B and C with provision for fast track for the stars. The company has a robust E learning management system through a tie up with Litmos. The intranet is also very strong in the organization. The company has also gone in for a lot of digitization.
Presently, there are 250 employees working in the company for the HR function.The diversity ratio of women employees have risen from 9% to 22%. In the engagement survey "safety of women in the workplace" got a healthy score of 95%. There is zero tolerance to sexual harassment in the work place. Further, in a company that has a lot of buying and other activities, the whistle blower policy is also very strong.(A whistle blower is a person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organization ). Venkataramana said that Titan, Infinite retail Ltd, McDonald's, Shoppers Stop and others are in the race with the company for a "Great place to work" in retail. ( Readers may like to read my earlier blog on "Great Place to Work- https://hrdian.blogspot.com/2018/10/the-journey-to-becoming-1-in-list-of.html )
Question-Answer session
Question: During festival time the queues can be very long and frustrating. How do you ensure that your front line staff who are educated only up to plus two, handle the pressure effectively?
Answer: We try to reduce the rush at the billing counter through steps such as self billing process and managing the mobile process. Further, the cashiers are given adequate training. The time taken on each transaction is measured.
In the interactive sessions, case studies are discussed on subjects such as integrity, customer satisfaction and how to enhance the customer experience. If the store does well, high incentives are paid.
Question: In view of the increasing automation, do you envisage loss of jobs in retail?
Answer: The automation in retail in India is only 10%. Hence it would take a while for it to have a big impact. Further, in view of low wages of manpower in India, it is still attractive for companies to employ people and this is not likely to change in the near future.
Question: How successful has been your engagement activities?
Answer: Under the scheme for employee development, 910 employees became graduates and have become eligible to become store managers. The success stories of people who have reached heights in the company are shared with new recruits during induction.As mentioned earlier, our attrition rate has come down drastically and is one of the best in the industry.
The millennials have very high expectations and are very different from earlier generations. Our challenge is to realistically prepare them for what to expect in the retail business. As for example they may come in with the expectations of working in an air conditioned environment of ease and comfort.We explain to them the real life out there would require hard work and "dirtying your hands". 40 to 45% of the attrition happens within the first 90 days of joining.
Mobile is going to be the way forward and we can use it effectively for learning needs in future.
As a means of handling stress, we expose the employees to Zumba dance ( Zumba is a dance form with aerobics fitness program created by Colombian dancer and choreographer Alberto "Beto" Perez during the 1990s) and AOL (Art of Living- meditation).
Having
worked whole through my life in manufacturing, this was for me a very
interesting and revealing session. I feel that having received these inputs, I would be less impatient and kinder to an employee at a retail store. After all, he or
she works under a lot of pressure and trying circumstances, The silver lining,
however is that if more companies take initiatives like the ones taken by the
Landmark Group, retail could also be a' great place to work' where employees can contribute and excel in the long run....
Valid observations and great sum up of take aways
ReplyDeleteThank you for your feedback Saranya!
DeleteNice MNR
ReplyDeleteThank you Pandian!
DeleteThe fact that the attrition rate could be brought down from 90 percent to 23 percent is a great achievement for the HR team. The usefulness of proper training is authentically proved in this case. Nice presentation . Thanks a lot Mr.Rajeev .
ReplyDeleteThanks a lot for sharing your thoughts Mr Shiv Kumar!
DeleteA good insight on employee motivation and retention. Curious to know how Landmark addresses other employee related personal areas like marriages anniversaries birthdays loss of loved ones in the family eye to make the message more informative
DeleteThank you for your feedback Sundar! I have passed on what the speaker shared. As for more initiatives, perhaps they aren't there, if not the speaker would have spoken about it. In any case as I understand it, in respect of retail business, a lot more needs to be done which would happen gradually...
Delete
ReplyDeleteTo live in your team, learn Freelancing Mastery and make money as a freelancer. Learn good grammar and make money from your passions, interests and experiences. Learn how to write for online audiences. Writing for magazines and blogs is two completely different things. Being competitive in freelance writing ensures that you are able to make a living and receive a fair amount of compensation. Mastery of Productivity.