Cost Reduction in HRM: Analysis of Tesco's Strategies and Practices

This report provides a detailed analysis of human resource management activities aimed at reducing employee-related costs within Tesco. It examines strategies for hiring and retaining high-performing employees, emphasizing the significant costs associated with high turnover and the importance of competitive benefits, non-monetary perks, and career development opportunities. The report also explores the crucial role of training and mentoring in cost reduction, highlighting the benefits of hands-on learning, goal setting, and fostering workplace independence. Furthermore, it discusses the automation of manual processes, such as staff portals and digitized documents, as a strategic approach to streamlining operations and saving costs. The report concludes with recommendations for Tesco to optimize its HRM practices and achieve its business objectives.

Running head: HUMAN RESOURCE MANAGEMENT
Human Resource Management
Name of the student
Name of the University
Author Note

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Executive Summary
In this assignment regarding human resource management, there has been provided a detailed
analysis of the human resource activities that will be reducing the employee related costs. The
organizatub that has been selected is Tesco. In respect of hiring and retaining better performing
employees, it can be stated that high rates of turnover will be resulting in substantial expenses
regarding lost productivity as well as training. In respect of improving training and mentoring it
can be stated that, appropriate training as well as mentoring is considered to be the most essential
aspect for undertaking cost reduction.

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Table of Contents
Introduction......................................................................................................................................2
HR activities that can be applied to reduce employee related costs................................................2
Recommendation for the organization...........................................................................................10
Conclusion.....................................................................................................................................11
Reference.......................................................................................................................................12

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Introduction
Tesco is a British multinational grocery as well as general merchandise retailer having its
headquarters in England, United Kingdom. It is regarded to be the third largest retailer globally
measured by profits and ninth largest retailer globally measured by revenues. It is having stores
in 12 countries across Asia as well as Europe.
The mission statement of Tesco does the identification of their approach to communities
as well as the environment for creating value regarding the customers in respect of earning their
lifetime loyalty.
The objectives of Tesco is to become a successful global retailer, to grow the core UK
business i.e. increasing the market share in UK and to be as strong regarding non-food products
as in food products.
HR activities that can be applied to reduce employee related costs
Within a challenging economy, the fundamental goals of a business organization in
respect of its staffs are to do the reduction of costs as well as do the improvement of
productivity. The human resource activities that can be applied for reducing employee related
costs are mentioned as under,
1. Hire & Retain better performing employees. High rates of turnover will be resulting in
substantial expenses regarding lost productivity as well as training. As a matter of fact, in respect
of every $10,000 in salary regarding a departed major staff, the employer does the losing of
almost six days of productivity. For avoiding increased turinover without increasing the expenses

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in a significant manner, there is the requirement for conducting continuous assessments of staff
satisfaction as well as providing non-monetray benefits for making the emoloyees feel satisfied.
In respect of retaining the better performing staffs, the following approaches can be taken into
consideration,
 Offering a competitive benefits package that will be fitting the needs of the staffs – This
can be done by offering health insurance, life insurance as well as a retirement-savings
plan that is considered being necessary to do the retention of staffs. However, other
perks, like flextime as well as the telecommuting option also assists in making the staffs
have the realisation that the organization is having the willingness to do the
accommodation of their external lives as well (Thite, 2014).
 Providing some small perks - Certain kinds of small perks such as dry-cleaning pickup,
which will support the staffs in better management of their lives, will result in the
employees giving appreciation for the same and they will be interested in staying with the
organization.
 Using contests as well as incentives to assist in maintaining the motivation of the workers
– When this aspect is conducted in an appropriate manner, such types of programs will
assist the organiational staffs in remaining focused as well as have a feeling of excitement
regarding their jobs (Sadiq, 2013).
 Conducting “stay” interviews - Alongwith the aspect of performing exit interviews for
learning the reason why staffs are leaving, the organization should also be taking into
consideration the aspect of asking staffs who are with the company with a longer time
period of time, the reason for their stay. Their viewpoints should be taken regarding the
matters that the organization needs to change or make an improvement about. These

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informations could then be used for strengthening the staff-retention strategies of the
company (Bamberger, 2014).
 Promotion should be made from within whenever there is a possibility – In addition to
this, staffs should be provided with a clear way to advance in their career within the
organization. Staffs might fall victim to frustration and might not work to the best of their
ability when they will not be seeing any clear future in respect of themselves within the
organization (Milhem, 2014).
 Fostering staff development – This could be associated with the aspect of training for
learning a new skill of job or reimbursement of tuition for assisting in furthering the
education of the staffs.
 Creating open communication within the staffs as well as management – There is the
requirement for holding daily meetings where staffs will be offerring ideas as well as
asking questions. There is the requirement for having an open-door policy that will be
encouraging the staffs in speaking in a frank manner with their managers (Bardoel,
2014).
 Getting the involvement of managers – There is the requirement for the managers in
spending time to coach the staffs, assisting the better performers in moving to new
positions as well as doing the minimization of weak performance.
 Communicating the business mission of the organization – To feel connected with the
goals of the company is an effective way for keeping staffs emotionally as well as
mentally connected with the organization (Reilly, 2016).
 Offering financial rewards – Taking into consideration the aspect of providing options
regarding stocks or other financial rewards in respect of staffs who will be meeting

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performance objectives as well as staying in respect of a pre-determined period of time,
such as, three or five years. Moreover, providing significant yearly raises. For instance, a
bonus structure can be created where staffs will be able to do the earning of an annual
bonus when they will be meeting performance objectives that are prespecified.
 Making sure staffs know what you are expecting from them – When the staffs are not
having the exact idea about what their jobs are entailing and what is precisely required
for them, they will not be able to perform as per the organizational standard and as a
result, their morale will start dipping (Dulebohn, 2013).
2. Improving Training and Mentoring – Proper training as well as mentoring is considered to
be the most essential aspect for undertaking cost reduction. A major concern is to do the
appointnent of a supervisor having limited or no training that will be causing internal issues that
are considered being difficult. Supervisors are required training the staffs regarding customer
service since customer satisfaction will be affecting revenue as well as performance (Armstrong,
2014). Moreover, supervisors are required cross-training every staffs such that when an
employee is on vacation or on sick-leave, another staff can do the absent employees work in an
effective manner.
Training and mentoring are serving as learning workplace tools that will be leading
towards the empowerment of the staffs. The staffs who receive coaching as well as mentoring
often does the receiving of the biggest benefits. In this regard, hands-on learning can be used,
whch states that the process of coaching as well as mentoring provides the neew staffs a hands-
on training program for learning job expectations. Staffs who are properly mentored, might often
have a feeling of better sense of understanding of what is needed from them regarding their jobs
since they receive a one-on-one job training, support as well as an experinced staff’s advices

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(Baum, 2015). When a staff does the receiving of this type of personalized training, he/she might
be having a feeling of empowerment for fully performing his/her job duties. In respect of goal-
setting, coaching as well as mentoring often take into consideration the aspect of setting goals in
respect of the staffs. The mentor assists the new staffs in setting partcular objectives in relation
with the job. The two are working collectively for creating a plan in respect of reachin those
objectives. Mentors can do the customization of objectives as well as support that the staff
requires in respect of his/her specific role. There is the availability of the mentor as a resource
when the new staff is having the requirement of assisstance for getting success. To have a set of
challenging goals is to motivate as well as empower the staff for working beyond the basic
needs. Regarding the aspect of independence, it can be stated that a mentor does the providing of
assistance in respect of a new staff, however, the final goal is empowering the staff for working
in an independent manner with the skills that has been learned by the individual. The capability
for working in a successful manner by an employee will be bringing a sense of empowerment as
the employee does the gaining of workplace independence. While the staffs are having a feeling
of confidence to function in an independent manner, the program of mentoring does the creation
of a sense of teamwork and mostly does the boosting of morale in respect of the staffs
(Cartwright, 2014). This positive environment for work continue doing the empowerment of
staffs in their work.
The effectiveness of coaching as well as mentoring states that there is a collaborative
workplace atmosphere in which professional learning is effective and employees are having the
eagerness as well as commitment for developing as well as improving themselves. The
management does the acknowledgement of the staff requirements in respect of professional
learning whose attainment must be done for raising the standards of the company. There are

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standard methods as well as various processes in respect of programs relating to coaching as well
as mentoring depending upon best practice. The redefining of the work roles in respect of staffs
are done for doing the incorporation of sessiosn related with coaching as well as mentoring
(Roche, 2014). The staffs do the recognition of the requirements as well as responsibilities for
attaining professional growth and there is an assessment regarding the influence of coaching as
well as mentoring on the employees as well as the company.
The benefits of coaching as well as mentoring states that there occurs the development of
better working relationships as because, the supervisor generally does the undertaking of the role
of a coach in respect of the employee. Similarly, the staffs also view their seniors as their
mentors who are having the willingness for guiding as well as assisting them in developing their
overall potentials. This helps in touching both the personal as well as professional aspects
regarding the employees. Therefore, through the process of implementing the process of
coaching as well as mentoring at the place of work, there occurs a signifucant contribution to the
complete growth of an employee as well as the level of organization (Shin, 2017). This is the
reason as to why, there occurs the incorporation of such programs as a daily practice within the
organizational process.
3. Automate Processes. One more strategic aspect relating to cost-saving is the automation of
the manual methods. To provide a staff portal will assist in streamlining of the processes related
to staff requests. Moreover, digitizing documents like staff handbooks will be doing the
elimination of copying expenses as well as making distribution to be more easy. HR Automation
is used by HR professionals for importing documents into digital repositories, organizing
imported documents so that they can be searched as well as retrieved, storing files in standard
formats in respect of sharing to multiple devices, archiving the records as well as making audits

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simpler by making it easier for gathering information (Stredwick, 2013). HR automation provide
assistance with these methods through the handling of key administrative tasks might otherwise
do the consumption of significant amount of time. Through the automation of the repetitive
tasks, the professionals of HR management will be collecting, creating as well as updating data
as well as making the availability of various workflows in respect of varied users, based on their
positions as well as job profiles. This will be assisting in making the organizations much more
effective, driven by rules as well as streamlined. One more area that can be significantly
streamlined with HR automation is considered to be the communucation process of the
organization. When human resources management starts doing the implementation of HR
automation, organizations start seeing improvement in profit as well as productivity (Kavanagh,
2017). The most significant advantage regarding human resource automation is security.
There are certain areas that HR management personnel consider being the most certain
methods in respect of HR automation. These are mentioned as under,
 Onboarding – Onboarding might be having the involvement of important paperwork,
signing contracts, completion of benefits paperwork as well as other essential duties.
When onboarding new joinees, the workflows as well as the onboarding method itself are
significantly improved with the help of automation. The time of processing in respect of
every different documents that are needed regarding the process of onboarding might be
reduced to a few hours rather than a week. It also assists in making certain that newly
hired personnel does the receiving of all of the required equiipment as well as grants
relating to the accessibility of system in a timely way.
 Staff personal data – When an organization does the addition of staffs, to track as well as
keep every personal information of the staffs to be updated can be very much challenging

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in respect of human resourcec personnel. To update staff data assists the human resource
management with human capital management. There occurs a signifucant reduction
regarding the chances of losing data as well as errors relating to manual entry (Krausert,
2014).
 Timesheets – To validate as well as track the timesheets can be considered being a very
ineffective as well as time-consuming process. When there occurs the automation of the
time-sheet approval method, the collection of data as well as information validation is
much faster. This also assists in saving the human resource personnel from updating the
records of a staff manually.
 Performance appraisal method – A significant majority of human resource management
professionals simply do not have the time that is needed for updating the performance
records regarding the staffs. To not receive manager’s feedback and not to have better
metrics will be leading towards inaccuracies. Through the using of automation, validating
performance assists in ensuring that the records get updated in a systematic manner and
will be allowing the organizations to easily view how the organizational staffs are
performing (Woodrow, 2014).
 Leave requests – When there occurs the submission of leave requests, it can be
considered to be time-consuming for processing them all. This might be making it
challenging in respect of human resource management as well as staff towards approving
leave requests in time. Human resource automation regarding the leave request methods
can assist in securing approvals much faster while also permitting the leave records of the
staffs to be updated immediately (Tracey, 2016). Thus, can assist businesses in tracking,
managing as well as approving the leaves of the staffs in a much more effcient manner.

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 Training requests – When human resource management does the implementation of
automation, staffs can do the self-management of their requests regarding training. Staffs
might be permitted toward applying in respect of specific courses for training regarding
the human resource process. Human resource departments can do the creation of
workflows so that there occurs the addition of the training details to the records of the
staffs when he or she will be completing it.
 Benefits – When there occurs the new hiring of individuals, they often will not be havng
the eligibility in respect of benefits till they do the completion of a probationary period.
Automating benefits methods will be letting the employees of human resources to have
an immediate understanding when staffs are having the eligibility in respect of
advantages. There will occur the update of the imformation regarding the payroll of an
organizational employee (Mayo, 2016).
Recommendation for the organization
It can therefore, be recommended that for Tesco there is the need to work with the staffs
and not against them. This can be done in a significant manner in which human resource will be
making a difference via talent management. Human resource can make a significant difference
through the identification of who the best staffs are, and in what ways they can be helped.
Moreover, layoffs need to be avoided at all costs. This is having a significant impact on the
organizational culture. It creates an adverse impact on the staff’s motivational level and even
though, productivity might not get impacted in the short-period, in the longer period, loyalty gets
influnced, work satisfaction gets impacted and innovative aspect gets significantly affected.