Human Resource Management: Analysis of Staff Turnover in Retail Sector

This report provides a comprehensive analysis of staff turnover within the retail sector, focusing on both micro and macro-level factors. The introduction sets the context by highlighting the importance of employee expertise in boosting consumer satisfaction and the challenges faced by the retail industry, particularly high staff turnover. The micro-level analysis delves into internal factors such as cultural differences, management of a diversified workforce, staff conflicts, lack of motivation, and inflexible working arrangements. It examines specific examples of employee complaints regarding working conditions, pay, and management practices at major retailers like Woolworths, Coles, and Aldi. The macro-level analysis explores external factors, including the impact of minimum wage laws, anti-discrimination legislation, and the role of company policies in employee satisfaction. The report includes an interview script between a Woolworths manager and an employee to gather insights into the causes of staff turnover, such as ineffective working environments, low pay, lack of training, and concerns about job security due to automation. The report concludes by suggesting strategies to address the issue of staff turnover, such as implementing effective incentive systems and conflict resolution mechanisms. Overall, the report provides a detailed examination of the factors influencing staff turnover and potential solutions for improving employee retention within the retail sector.

Human Resource
Management
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Table of Contents
PART A...........................................................................................................................................1
INTRODUCTION AND CONTEXT..............................................................................................1
MICRO LEVEL ANALYSIS..........................................................................................................2
MACRO LEVEL ANALYSIS........................................................................................................3
PART B...........................................................................................................................................4
INTRODUCTION...........................................................................................................................4
Interview script............................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................1
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PART A
INTRODUCTION AND CONTEXT
Now-a-days, companies invest a significant proportion in the knowledge, talent and
capability enhancement and not just in the technologies. It is because, they serve client through
their workers, thus, by maximizing their expertise and talent will help establishments to boost
consumer satisfaction. According to Australian Bureau of Statistics (ABS), in March 2017,
employment just increased by 1.22% (146,000 in numbers) at an average employment growth of
12,167 each month. It seems surprising and disappointing result because according to the labor
market indicators, growth in employment must be high. Looking to the various industries, retail
industry is the second largest contributor to employment after healthcare sector (Scutt, 2017).
However, the sector shows fallen result in employment over a year.
(Source: Scutt, 2017)
According to the graph, retail industry shows 5% employment loss over historical period
and as per the current statistics, currently, it employs approximately 1.2 million people fallen by
59,300 (as illustrated in graph) over last period. In the retail sector, consumer satisfaction
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extremely depends on the employee’s capabilities to serve consumers in the best way. However,
considering current market conditions, industry is facing number of challenges in their workforce
management. There are various internal which affect workers management such as firm strategy,
culture, lack of coordination, conflicts etc. however, external factors constitute of innovation,
market conditions, change in rules and regulations and others.
Australian Workforce and Productivity Agency (AWPA) investigated various workforce
development issues that the industry is suffering from such as demographic change,
technological advancement, diversity management and others. Out of all, high staff turnover is a
key issue faced by the industry (Cho and et. al., 2006). Thus, the paper will investigate various
micro and macro factors which is a reason behind high staff turnover.
MICRO LEVEL ANALYSIS
In Australian retail sector, currently, companies are facing tough time for retention of
qualified and talented labor pool. Staff turnover is an issue where employees are giving
resignation to the organization due to varied reasons. At the same time, it seems really
challenging for the retailers to find a capable staff and retain them for a long-lasting period in the
company. There are number of factors or components which found as a cause for exceeded
employee turnover i.e. cultural, managing diversified workforce, staff conflicts, lack of
motivation and many others (Harzing and Pinnington, 2010). With the changing demographics and
internationalized operations, now-a-days, all the Australian retailers employed diversified
workforce in their business. However, their way of working, opinion, views may significantly
differ from each other resultant staff conflicts.
Workers are not satisfied with the internal management for the people belong to
diversified background, culture or nationalities. Moreover, now-a-days, people need sufficient
flexibility at their workplace, so that, people can manage effectively their personal and
professional life (Baum, 2006). In order to provide flexible working arrangements, Woolworth
provide part-time working arrangements. Currently, there are 17000 staff contracts stipulate
flexible arrangements in terms of working hours, still, around 3% means 600 workers are
working under inflexible hours which include 8AM to 5PM working time for Monday to Friday
and on Saturday, they need to work till 1PM. The reason behind this is such working contracts
were made many years ago when flexible arrangement was not in common corporate practice.
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Besides this, FWAs includes overtime, allowances, job sharing, working in shifts, work from
home and many others.
Many employees share their horrible job experience stating heavy lifting, unpaid
overtime, strict internal management policies, backbreaking labour and others at Coles, Aldi and
Woolworths. Moreover, staff members at Woolworth also had compliant for the less promotional
opportunities and unfair payment terms at Woolworth (Kippist, 2017). At a Queensland store,
one team member complaint for bullying practices at and questioned security and safety at
workplace. It resultant stress to the workers and as a result, they decide to resign. Another
employee at NSW claimed for unfair treatment at the store by manager. In despite of this,
workers also complaint for excessive overwork at a very little pay, horrific pay, no job security,
poor management as a main reason behind their leaving decisions (Tran, 2015). According to
Exit Info, one in every five-worker said that poor management is the main reason for their
resignation to the business. It resultant high absenteeism and high turnover. Companies train
their workforce thus, staff turnover result in high cost (Aswathappa, 2005). Evidencing it,
Australian businesses faced 100AUD bn cost as a result of high workers turnover resultant lost
productivity, training and recruitment cost.
MACRO LEVEL ANALYSIS
In Australia, there is a minimum wage act by which companies are obliged to pay a
minimum pay to the workers and necessary to be followed by all the retailers and other
companies irrespective of the industry in which they operate. This legislation focuses on
maintain a good pay for the workers in return for the efforts what they made. Moreover,
Australia has number of equality laws such as Racial Discrimination Act, 1975, Disability
Discrimination Act, 1992, Sex Discrimination Act, 1984 and Age Discrimination Act, 2004. The
key aim of such laws is to treat all the workers equally without discrimination on any ground
such as nationality, race, color, gender and others. All these anti-discrimination laws protect
employees from unfavourable treatment or possible discrimination (Blair and Roe, 2010).
United Nation Human Rights Committee also favoured equality treatment and
recommended Australia to adopt a federal legislation including all the areas or discrimination
gounds. Similarly, Committee on the Elimination of Racial Discrimination and Committee on
Economic, Social & Cultural Rights stated that Australia must create a common law to
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strengthen and harmonise their anti-discrimination legislations (Jackson, Schuler and Werner,
2011).
On the other side, at institutional level, Woolworth had designed employee protection
policies, safety policies, sexual harassment policy and others so as to satisfy workers. In the FY
2017, board constitute of female and male in equal proportion (50%) (Flies, 2012). Although
company follows rules and regulations to manage diversified workforce successful and invest in
training and development programmes under the skill development. Moreover, it has its own
remuneration framework, succession planning and conduct various career development plans for
the sound workforce management (Kusluvan and et.al., 2010). Woolworth follow Employee Value
Preposition (EVP), under which, firm provides both the monetary as well as non-monetary
rewards to their workers to help them in staying in the organization for a longer period. In this
plan, group explore growth opportunities for the workers through career development & training.
However, in the culture, it maintain ethical standard, brand and respect diversity (Lengnick-Hall,
Beck and Lengnick-Hall, 2011). Company also recognize their employee’s effort and praise for their
innovations. By employing participatory leadership, all the staff are invited into key decisions
and policy formulation to express their own views and opinion.
PART B
INTRODUCTION
In order to analyze the issues of staff turnover, manager of Woolworth has taken decision
relation to conducting interview. The rationale behind the selection of such of interview process
is that it helps in getting suitable information about the reasons due to which such issue occurred.
High staff turnover is the major issue which in turn have direct impact on the growth and success
of business unit. Moreover, high staff turnover within the organization may result into lack of
experienced personnel, training expenses etc. From assessment, it has been identified that
experienced personnel perform business activities and functions more effectually as compared to
the new one. Thus, with the motive to overcome such issue HR team of Woolworth has
conducted interview between the management and personnel to identify the factors that compel
them to leave the organization.
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Main players of interview session include Harry who works as operational manager in
Woolworth. Further, employee with whom interview is conducted namely Sam. He works in the
operational team and directly deals with the customers. In interview, several questions have been
asked by the manager in relation to working condition, salary, job satisfaction, motivation and
promotional aspects etc. Moreover, at workplace, working environment, leadership,
communication, team management etc are the main factors which in turn have direct influence
on employee motivation and thereby may turn into staff turnover. Thus, such interview session is
highly effectual which in turn provides HR team with the suitable input for decision making and
thereby helps in developing strategic framework.
Interview script
Harry: Hello
Sam: Hello sir, Good Morning!
Harry: How’s your work going on?
Sam: Sir, it is going good.
Harry: Do you face any issue while working?
Sam: Sir, at the time of peak load, I face difficulty in handling customers. During peak season, I
have to work for long hours which in turn impose issue in front of me pertaining to managing
balance between personal and professional life. At the time of Christmas and other time, when
high discounts are offered by the company then problem I face issue in managing work.
Moreover, due to heavy discounts more customers prefer to do shopping for getting benefits. At
this time, there is a requirement to appoint some personnel for dealing with the customers.
Harry: In accordance with you, which factor may cause of high staff turnover in Woolworth?
Sam: According to me, ineffective working environment is one of the main reasons behind the
increasing employee turnover in Woolworth. There is the absence of supportive environment
which in turn creates high level of stress. All the team members only make focus on their work
but they do not support others. Thus, due to the lack of cohesiveness most of the individuals are
not happy. Besides this, lack of flexibility is another main factor due to which employees are
taking decision in relation to moving from retail sector.
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Harry: According to your which factors are currently influencing motivational aspect at
workplace?
Sam: Now, each individual wants to maintain high living standard but it is possible only when
disposable income is high. Thus, lower earning level is negatively influencing my motivational
level. Moreover, in the company, there is a lack of effectual incentive system that offers
opportunity to the individuals in relation to earning more money. Along with this, company also
do not offer high bonus and other financial benefits. Thus, it is one of the main cause due to
which employees are compelled to leave job.
Harry: There is a need of organizing training at workplace?
Sam: Yes, according to me, business unit is required to lay emphasis on conducting training
session on a periodical basis. Moreover, through the means of training session firm can persuade
me and others about the ways through which they can deal with the customers prominently.
Along with this, training session also offers opportunity to us to interact with others and enables
in sharing feeling as well as opinions. In addition to this, through the means of training company
can also provide information to the employees about the effectiveness of team in the context of
organizational growth and performance.
Harry: Do you think that changes take place at operational also influences staff motivation?
Sam: Yes, now with the motive to offer quality services to the customers company lays high
level of emphasis on automation. This in turn creates fear factor among me pertaining to job
security and thereby leads high turnover. Moreover, usually technological changes may result
into decrease in job opportunity in the firm. In this regard, firm should lay emphasis on
conducting session which in turn develops familiarity regarding the benefits of change.
Harry: Suggest some strategies through which issue of staff turnover can be controlled?
Sam: In accordance with me, there is a need of devising and introducing effective incentive
systems. This in turn motivates individuals to make their best efforts and work with the firm for
longer duration. Besides this, firm should make focus on indulging effectual conflict resolution
system. On the basis of such aspect, by resolving the issues of team within the suitable time
frame firm can evolve satisfaction among them and retain for long term. Along with this,
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company should also conduct games, picnic and other program for the employees. This in turn
develops job satisfaction among the personnel and thereby develops harmonious environment.
Further, HR team should make focus on taking feedback from personnel on a continuous basis.
By doing this, manager can identify the issues which are facing by the personnel and thereby
would become able to take strategic measure within the suitable time frame. Thus, by
undertaking all such actions control can be exerted on the issue of staff turnover.
CONCLUSION
As per the discussion made above, it can be concluded that although Woolworth made
significant efforts to respect their employees and their contribution to the business success and
growth, still, company is facing problem of high turnover. The discussion found that heavy
workload and overtime at a very little or no payment is a key reason why many of the employees
decided to resigned the job. Thus, in order to manage such peak load, company should hire more
personnel as per their requirement as hiring result in cost of remuneration, therefore, instead of
hiring permanent workers, Woolworths HR professional should hire temporary workers like part-
time and contract-based workers so that work load can be managed and stress and frustration
among existing workforce can be reduced. It will assist firm to help staff members to stick or
stay with the firm for prolonged time.
Besides this, poor management and absence of cooperative and supporting environment
at the workplace is another reason determined responsible for increasing number of voluntary
separation inside the company. Therefore, company must organize various events like team
building activities and others to create favourable environment by strengthening bonding among
all. In despite of this, motivation workers is equally important therefore, to encourage them, firm
needs to pay all the workers with a good pay scale because as per interview, workers are not
currently satisfied with the pay. Moreover, although, no-doubt, Woolworth already rewarded
employees with both the monetary and non-monetary rewards, still, people are not enough
satisfied with the incentive or reward plan. Therefore, it bring it necessity for the firm to create
effective plan where every worker is being encouraged with different ways either intrinsic or
extrinsic. As company has diversified people therefore, conflicts are very common at workplace
which only can be reduced by strengthening their inter-personal relationship. It also require
regular communication or discussion with the workers to know their issues whatever they face.
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By receiving feedbacks and knowing their satisfaction level, issues can be found and resolved by
creating unique strategies. Sound conflict resolution will definitely develop an attitude among
people to stick with the establishment for a continual period. As an attempt, Woolworth recently
conducted “Let’s Ask” survey in which it received 74.5% employees respond positively as they
believed that company is well rewarding them and rendering many benefits (Woolworth annual
report, 2016).
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REFERENCES
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hospitality firms’ performances. International Journal of Hospitality Management. 25(2).
pp 262-277.
Harzing, A. W. and Pinnington, A., 2010. International human resource management. Sage.
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Kusluvan, S. and et.al., 2010. The human dimension a review of human resources management
issues in the tourism and hospitality industry. Cornell Hospitality Quarterly. 51(2). pp
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Lengnick-Hall, C. A., Beck, T. E. and Lengnick-Hall, M. L., 2011. Developing a capacity for
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Online
Flies, 2012. Flexible working hours: Woolworth’s operational requirements. [Online]. Available
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29th October 2017].
Kippist, L., 2017. Workplace flexibility is alive and well. [Online]. Available through: <
http://www.news.com.au/finance/work/working-in-a-flexible-environment/news-story/
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Scutt, D., 2017. Australia’s retail sector shed nearly 60,000 jobs over the past year. [Online].
Available through: < https://www.businessinsider.com.au/australias-retail-sector-has-
shed-nearly-60000-jobs-over-the-past-year-2017-5>. [Accessed on 29th October 2017].
Tran, C., 2015. [Online]. Backbreaking labour, unpaid overtime and strict managers: Coles,
Woolworths and Aldi staff reveal what it's REALLY like to work at Australia's biggest
supermarkets. Avaialble through:
http://www.dailymail.co.uk/news/article-3313134/Employees-reveal-problems-faced-
Coles-Woolworths-Aldi-staff.html. [Accessed on 28th October 2017].
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