HR in retail: 5 trends HR leaders should watch out for in 2017

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The battle for consumers’ hearts and minds is constantly being waged between online-only companies and bricks-and-mortar retailers.

It’s often pointed out that the on-demand economy doesn’t need to put boots on the ground, to use a military phrase; that’s widely regarded as a competitive advantage as it saves money on overheads and wages.

The solution was once thought to be cutting labour costs and employing a disposable workforce, but that attitude is changing and retailers are now seeing employees as a fundamental part of a company’s potential success.

We’re entering the age of the retail employee as an asset and this looks set to drive many of the retail trends in 2017.

Employees are your new customers

HR constantly faces a challenge to prove the ROI of employee development in an industry that experiences a 60% employee turnover per year, according to Bloomberg. Yet with the cost of replacing an employee estimated to be one fifth of their salary, a focus on retention only makes sense.

In 2015, Walmart implemented a brave new policy that focused on employee engagement and satisfaction; it boosted the wages of 500,000 employees, invested in employee training and set out clearer progression paths to attract people seeking a career instead of a wage.

Employee turnover decreased and “clean, fast, friendly” scores in customer surveys rose for 90 consecutive weeks

Operating costs increased and shares fell, but revenue also increased by $5.3billion in the first six months of 2016; employee turnover decreased and “clean, fast, friendly” scores in customer surveys rose for 90 consecutive weeks from the start of 2015.

Companies like Target and TJ Maxx have followed suit by raising wages. Suddenly the benefits of an engaged, contented workforce are becoming obvious.

The message is simple: happier employees make happier customers and that makes good business.

Focus on employee wellbeing

Employers no longer regard wellbeing programmes as a luxury. It doesn’t take a genius to realise that an employee’s performance will suffer if they’re unhappy or unhealthy.

Tesco is just one firm that has embraced this concept. They offer access to an occupational health team, vouchers for health-related investments, a money advice service and free Relate counselling for employees and their families.

Asda have also provided a Wellness Hub that offers private consultation rooms for occupational health and a space to discuss mental health.

Wellbeing programmes create a healthier culture, offer support to employees, create an inclusive environment and a better work-life balance; they actively address potential issues rather than reactively responding to symptoms like stress, or other health problems that can result in extended absenteeism.

Asda have also provided a Wellness Hub that offers private consultation rooms for occupational health

Awareness campaigns have helped to remove the stigma about mental and physical wellbeing and companies are extending this new awareness into the workplace - as 2017 dawns, wellbeing is only going to become a bigger issue.

Retailers’ existing programmes are already demonstrating the benefits of a proper wellbeing programme in terms of retention and engagement. As the evidence mounts up, it’s something that’s certain to be embraced by the industry.

New performance rewards

Annual pay reviews are now looking like an archaic way to measure performance; it’s an outdated system in today’s real-time, responsive world. A yearly appraisal seems like a drop in the employee experiential ocean.

Modern employees expect ongoing feedback and open forums to relay their opinions - 2017 will see more companies turn to variable pay as an alternative way to offer meaningful financial incentives outside of a strictly scheduled annual raise.

Options like spot bonuses allow employers to reward great work without permanently altering salaries.

Targeted recruitment to improve retention

What comes first when it comes to having great employees – recruitment or retention? It’s a tricky question but retention can certainly be improved if you hire the right people.

Hiring cultural fits will reduce the risk of departures, so future recruitment needs to focus on how potential candidates are targeted and assessed. Employee referrals are a proven tactic but expect social recruitment to grow steadily in 2017.

Employee referrals are a proven tactic but expect social recruitment to grow steadily in 2017.

Retail relies heavily on younger millennial and generation Z employees who are obsessed with social media and mobile technology, so HR needs to embrace these channels when recruiting for retail.

Companies also need to improve their employee branding and online profiles as digital natives will use this information to assess where they want to work. HR will have to actively monitor their company profiles and online presence to compete effectively for the available talent. 

Embracing the auto-scheduling revolution

One of the constant challenges of retail is ensuring that you have enough employees with the requisite skills on the shop floor. Workforce management technology can now delve into data analytics and historical sales data to calculate all your future staffing needs.

Dynamic rostering automatically provides a roster that ensures that you have the right number of employees with the right skills to provide the service your customers’ demands. This ensures that staffing levels are accurately calculated and reduces pressure on employees who could struggle in under-staffed situations.

Retailers are increasingly ditching outdated HR systems for cutting age, cloud-based tech and reaping the benefits - dynamic rostering is just one way that technology will revolutionise talent management on the shop floor, and free up HR or team managers to focus on strategy and team performance.

Technology will always influence how consumer behaviour develops, which influences the wider industry as a whole; yet the recent focus on retaining and developing employees is a quiet people-led revolution that looks set to bring about some real changes to retail in 2017.

It's HR in Retail month on HRZone! We're focusing on all things retail - check out our HR in retail hub to read all our great content!

About Simon Dowd


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By tazio
21st Nov 2016 09:41

Some good points Simon. However, I think most retailers realised a while back they need to look after their employees. John Lewis has led the way for sometime on this front.

With the rise of HR Analytics, its now easier to demonstrate ROI for investment in people. Certainly, a more data-driven recruitment process helps retailers identify the best candidates, reduces turnover and improves productivity.

Thanks (1)