Shifting your retail talent management strategies can strengthen an employee-centric work culture. Read below as we dive into recommended shifts that retail talent managers should consider in today’s market.
High employee retention rates can indicate a healthy organization that appropriately supports its workforce and ensures its loyalty to the company. Historically, turnover rates for retailers have always been problematic compared to other industries. Today, more than 90% of retailers are facing talent shortages. There are many factors at play that puts the retail industry at a disadvantage when it comes to employee retention, including company culture, compensation, and how individuals are onboarded and developed throughout their career, among others
But even with those factors at play, there are measures companies can take to limit the amount of employee turnover in this volatile employee market. In 2021, 25% of people resigned from their job. For the retail industry, that number was 63% of employees quitting – and remember, it can cost up to two times their salary to replace an employee. So, what is it about the retail industry that makes acquiring and retaining talent challenging, and what can be done to mitigate the cost accrued due to loss of talent?
It’s important to mention the type of retail we’re talking about, and for the sake of alignment, let’s focus on retail stores. The nature of retail stores is cyclical. Retail seasons come faster than our calendar indicates to meet consumer demands. Shoppers expect their retailer to have products in stock long before a holiday or season to prepare ahead of time. Not only do retailers need employees who deeply understand the range of products, they must also have immaculate customer service skills while also enduring physically demanding workloads in a fast-paced environment.
Those employees must also be able to quickly adapt to change, both in product lines, consumer preferences, and pivots in go-to-market strategies. That is a tall order to ask when companies don’t meet the threshold for appropriate compensation or meaningful work according to their employment standards. What solution is there that also meets company objectives and can be profitable for both employee and employer?
Creating an Employee-Centric Work Culture
Most retail companies have a clearly defined market strategy, target sales goals, and, ideally, a customer-centric business operation. For retailers, it’s equally as important to designate employee-focused metrics and objectives, too. It’s one thing to include employee satisfaction surveys but another to create a budget to fulfill employee requests and have an employee-centric work culture.
Customer profiles are prized intel and carefully handled to create the perfect customer experience, and acquiring and selling data on customer profiles is an estimated $200 billion business. This can be done with employees, too. We have now entered an era where we must handle employee satisfaction with care. Employers no longer have the luxury of dismissing dissatisfied workers. This seems like a big undertaking, but it can be alleviated with some intentional retail talent management strategies.
Talent management goes beyond finding suitable candidates for a position. It’s intended to nurture the entire employee lifecycle. The work conditions altered by the pandemic forced companies to reassess how they orchestrate their talent strategy. Below we outline shifts retailers need to make to redefine their talent management strategy to better realign with our current job market.
Shifting Your Retail Talent Management Strategies
1. Acquiring talent initially -> sustaining talent:
Retailers need to invest as many resources as they allocate for recruitment and onboarding to develop and meet your employees’ needs upon hire. A definite budget needs to be allocated to the development of your employees long after their hire date for upskilling and development.
2. Restricted compensation -> flexible incentives outside of base pay:
Employees are looking for an all-around fit rather than just base pay. Do they fit with the company culture? Is their flexibility within their role? Is there room for growth? People have more options now than they did five years ago, so a higher-paying position alone isn’t going to cut it.
3. Company-led employee initiatives -> employee-driven initiatives:
Retailers should provide their employees with the opportunity to not only participate in company initiatives but to also suggest new initiatives and empower them to lead them. This not only inspires collaboration and investment but can also create a more meaningful and engaged work environment.
4. One size fits all approach -> holistic understanding of employee:
Not every employee has the same internal motivation. Talk to your employees, and get to know them on more than a surface level. Understand what types of incentives are meaningful to them. Not all modes of communication are suitable, so tailor your approach accordingly.
5. Managers that drive results -> managers as leaders:
Leadership skills are different from management skills. Have you assessed the skills that your managers have, and do you provide the opportunity for leadership development? Be intentional with whom you acknowledge as leaders in your organization, and make sure they are equipped with the resources and training necessary to be effective managers.
Going Forward with Retail Talent Management
Talent management is the heartbeat of any organization and must continue evolving as the market shifts with society. The moral of the story is that we shouldn’t overcomplicate the retail workforce. As head of talent management for a retail company, your job is to understand what employee needs are, meet those needs, and provide the resources and support necessary to enable their success – this can also potentially lead to a pipeline of future leaders.
Gallup’s research indicates that employees don’t leave companies; they leave managers and supervisors. Retailers should take a closer look at their management and equip those individuals with the resources and skills to connect with their team, leading to longevity with the company and allowing knowledge to stay in-house. With the above insights and tips, retailers will be in a better position to retain and engage motivated employees.
For more talent management best practices, reach out to our team today.
Subscribe to Clarkston's Insights
Contributions from Tigist Abebe