Chapter 15 – Human Resources and Managing the Store
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CHAPTER 15
HUMAN RESOURCES AND MANAGING THE STORE
ANNOTATED OUTLINE
INSTRUCTOR NOTES
• Retailers achieve their financial objectives by effectively
managing their five critical assets: locations,
merchandise inventory, channels, employees, and
customers.
I. Acquire and Retain Human Resources
• The activities retail managers engage in to acquire and
retain productive employees include recruit, train and
LO 15-1 Describe how to
acquire and retain employees.
See PPT 15– to review the
A. Recruit Retail Employees
• Step 1 in the process for acquiring and retaining
employees is to recruit competent employees.
Ask students if they think
recruiting Millennials needs to
1. Develop the Job Description
• The job description identifies essential activities to be
undertaken and is used to determine the qualifications
of potential employees.
Ask students to discuss the
skill level differences between
selling jewelry in a high- end
specialty store and selling
Chapter 15 – Human Resources and Managing the Store
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• The job description includes specific activities the
employee needs to perform and the performance
costume jewelry in a full line
discount store.
2. Locate Prospective Employees
• Some creative approaches being used by retailers to
recruit applicants, in addition to placing ads on Craigslist
Ask the students to comment
on applications they have
3. Screen Applicants to Interview
• The screening process matches the applicants’
qualifications with the job description.
• Many retailers use automated prescreening programs as
a low-cost method for identifying qualified candidates.
• Job application forms contain information about the
Have students role-play a
telephone conversation
requesting references on a
specific student being considered
for a job. One student can play
the employment manager and
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• Retail managers generally expect to hear favorable
comments from an applicant’s references or previous
supervisors, even if they may not have thought highly of
4. Test Applicants
• Intelligence, ability, personality, and interest tests can
provide insights about potential employees.
Should employers use a
student’s grades when
determining who to interview
5. Preview the Job
• Turnover declines when the applicants understand both
the attractive and unattractive aspects of the job.
6. Conduct a Personal Interview
• After screening applications, the selection process
typically involves a personal interview.
Have students role play an
employment interview. One
B. Train and Acculturate Employees
• Having hired employees with the required skills or
potential to develop these skills, retailers need to train
Ask students if they think good
employees are made or born.
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them to do their jobs and introduce them to the firm’s
policies, values, and strategies.
In other words, which is more
important, recruiting (step 1)
1. Provide a Structured Program
• A structured training program helps new employees
acquire the basic skills and knowledge that they need to
be able to do their jobs.
See PPT 15-11
2. Offer On-the-Job Training
• Structured training programs need to be combined with
on-the-job training in which new employees work in
specific jobs under the direct supervision of their
managers.
Ask students if they would
rather work for a company
that emphasizes on-the-job
training versus classroom
training. Why?
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3. Use a Blended Approach
• Because of the relative advantages of structured and on-
the-job training, many firms use a blended approach.
Ask students if a blended
approach is best. Why or why
not?
4. Analyze Successes and Failures
• Effective managers provide an atmosphere in which sales
associates can try out different approaches for providing
customer service and selling merchandise.
Ask students if they analyze
their successes and failures in
classes. Why or why not?
C. Motivate Employees
• Motivating employees to perform up to their potential
may be managers’ most important and challenging task.
1. Set Goals to Motivate Employees
• To effectively motivate employees, managers need to
set goals for their employees and provide feedback on
the employees’ performance relative to those goals.
Ask students what motivates
them to put forth their best
efforts. What rewards would
students like in recognition of
work preformed?
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approaches are necessary to manage and motivate
younger employees.
advantages and disadvantages of
having employees participate in
D. Evaluate Employees
• The objective of the evaluation process is to identify the
1. Who Should Do the Evaluation?
Ask students to discuss the
advantages and
2. How Often Should Evaluations Be Made?
• Most retailers evaluate employees annually or
semiannually. Feedback from evaluations is the most
effective method for improving employee skills.
What problems arise if
evaluations are done too
frequently? Not frequently
enough? Should newly hired
salespeople be evaluated
3. What Format Should Be Used for Evaluations?
• Evaluations are meaningful only if employees know what
they’re required to do, the expected level of
performance, and how they’ll be evaluated.
4. How Can Managers Avoid Evaluation Errors?
Review the evaluation errors.
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• When making evaluations, managers tend to
underemphasize effects of external factors on the
department, such as merchandise and competitors’
actions.
5. HRM Performance Measures
• Three measures that retailers frequently use to assess
HRM performance are employee productivity, turnover,
and engagement.
measure employee engagement.
Ask students which types of
retailers have low and high
labor productivity.
C. Reward and Compensate Employees
• Employees receive two types of rewards from their job:
extrinsic and intrinsic.
See PPT 15-18
Employees work for different
reasons. They seek different
rewards. Ask students what
1. Extrinsic Rewards: Compensation Programs
• Extrinsic rewards are rewards provided by either the
To illustrate the differences
between intrinsic and extrinsic
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• Employees don’t all seek the same rewards. Some
employees want more compensation; others strive for a
promotion in the company or public recognition of their
• Incentive compensation plans reward employees based
on their productivity. With some incentive plans, a
salesperson’s income is based entirely on commission—
called a straight commission.
• A quota bonus plan provides sales associates with a
bonus when their performance exceeds their quota;
however, quotas should be developed for each
salesperson based on their experience and abilities.
their intrinsic rewards? What
are the extrinsic rewards? Are
the intrinsic rewards affected
when the extrinsic rewards
plan benefit the employee?
2. Intrinsic Rewards
• Intrinsic rewards are rewards that employees get
personally from doing their job well. One approach to
making work fun is to hold contests with relatively small
Ask students why employees
are motivated to learn and try
new, creative approaches
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II. Leadership
• Leadership is the process by which a person attempts to
influence others to accomplish a common goal or task.
• Mangers are leaders of their group of employees.
LO 15-2 Illustrate effective
leadership strategies of a
retail manager.
Ask students: what are the
characteristics of a good
leader?
A. Leader Decision-Making Style
• Autocratic leaders make all decisions on their own and
then announce them to employees.
Ask students to describe
managers who they have
worked for that were very
B. Maintaining Morale
• Morale typically goes up when things are going well and
employees are highly motivated. But when sales are not
going well, morale tends to decrease, and employee
motivation declines.
III. Controlling Costs
LO 15-3 Explore the various
strategies retail mangers can
undertake to control costs.
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A. Labor Scheduling
• Labor scheduling determines the employees assigned to
each area of the store during each hour.
• Retailers can control their costs, as well as improve their
service provision, because they can match their staffing
to customer demand on an hourly basis.
B. Store Maintenance
• Store maintenance entails the activities involved with
managing the exterior and interior physical facilities
associated with the store.
C. Inventory Shrinkage
• Shrinkage is the inventory loss due to employee theft,
shoplifting, mistakes, inaccurate records, and vendor
errors.
Security measures reduce
shoplifting. What negative
consequences do they have?
Chapter 15 – Human Resources and Managing the Store
IV. The Organization Structure for a Retail Firm
• The organization structure identifies the activities to be
performed by specific employees and determines the
lines of authority and responsibility in the firm.
LO 15-4 Summarize how
retailers are typically
organized.
See PPT 9-13
B. Organization of a Single-Store Retailer
• Owner-managers of a single store may be the entire
organization. Coordinating and controlling employee
activities is easier in one store than in a large chain of
stores.
See PPT 15–19
Small stores typically violate
the principles of organization –
-unity of command and
C. Organization of a National Retail Chain
• In contrast to the management of small retailers, retail
chain management is complex.
See PPT 9-20
The Mazur plan emphasized
the separation of buying and