Contents

• This assignment is based on the following case study –
• Lamplight Homes and Fashions is a reasonably progressive High Street Department Store traditionally selling home products including, furniture, e.g. sofas, chairs, occasional tables and display cabinets, soft furnishings and accessories, electrical goods and ladies, gents and children’s wear. The company also is well known, as its name implies, for its extensive range of quality lighting. Together with fashion wear lighting accounts for approximately 60% of sales.
• Like all High Street retail stores the company has been badly affected by the recession and has seen sales drop in some departments by almost 30%. The average across the company though is 15%. Although the retail economy is improving and consumer confidence is return the Directors feel that a ‘root and branch’ review of operations is required. There is now little doubt that any complacency that may have existed has well and truly been blown away by the recession and some very fundamental lessons have been learned.
• Some interesting points have emerged from the review:
• 1. the Department Store is located in a major Scottish City which is surrounded by 5 or 6 reasonably big ‘feeder’ towns.
• 2. the organisation is traditionally a city centre located department store and relies totally on customers coming to the city centre to shop;
• 3. it has no out of town locations in for example, retail parks were car parking is much more convenient and less costly than in town parking;
• 4. there is no discount sales outlet which for some similar Department Stores in other Cities appears to have become a lucrative way of selling end of range products and stock;
• 5. there is no online selling or supporting promotional material;
• 6. the company has an excellent reputation for quality and customer service;
• 7. management of the organisation is very centralised with senior management all located in the city centre Department Store which itself is managed on a Departmental basis with every Department ‘headed’ by a Department Manager who is supported by a Deputy Manager and of course sales staff; the central management structure includes, Accounts, Marketing/Fashions, Purchasing, Home Products and HRM. Each function is headed by a Director;
• 8. HR is also responsible for a ‘logistics’ role and includes a number of ancillary services such as, cleaning and building maintenance;
• 9. Staff are allocated to Departments based on sales and consequently revenue – this has been a source of discontent for some time as some departments with high cost items tend to attract more staff than those Departments which offer lower cost items to the customer; the argument here is that to reach the same level of revenue lower cost Departments have to complete many more financial transactions and have much more customer interaction than the Departments with higher cost products, e.g. digital televisions; therefore lower cost item Departments have fewer staff to complete more staff intensive work; some Department managers have been arguing for a staffing and financial accounting approach based on pre-determined budgets;
• 10. The warehousing and customer deliver vehicle fleet is under-utilised due partly to the drop in sales but also due to the influence of competitors, e.g. online selling.
• The future
• Following the review of the organisation certain strategic considerations are being considered:
• 1. to set up a presence in out of town shopping centres – not necessarily offering the full range of products but perhaps focusing out of town shops on particular product ranges or themes, e.g. Lamplight Home Products, Lamplight Soft Furnishings and Lamplight Fashions or a combination of themes; the main concern here is how ‘themes’ are matched to particular locations in a way in which they don’t complete with the main Department Store or inadvertently, with each other;
• 2. to establish a discount shopping outlet where out of season fashion ranges and obsolete products can be sold at ‘attractive’ prices;
• 3. to establish an online shopping business and to increase utilisation of the customer delivery fleet (free delivery for local purchases – say within 20 miles of the City Centre Department Store)
• Some of the issues already identified relate to the workforce and the provision of relevant skills.
• Given the traditional nature of the organisation the workforce is what might be described as ‘mature’ and reluctant to change. Although traditional skills will still be needed in the City Centre Department Store, the Discount Selling Store, the out of town Stores and the online business will all require new or different skills, attributes and attitudes to develop these businesses.
• There are also implications for every aspect of the organisation’s operations and functions and ‘everything’ will need to be done quicker! For example, ordering, purchasing, selling and related administration, receiving goods in and dispatching/delivering. The Directors have identified that what is needed here is a complete change of approach to how they deliver their business, particularly online selling, reflecting a ‘can do’ rather than ‘administrative’ approach.
• This has been a useful exercise for the new HRM Director to undertake as it forced her to get out of her office to look around the organisation and to consult with managers and staff beyond her immediate HR team.
• Current Employee Relations Practices:
• Pay is slightly above average for the sector and there is a variety of other financial benefits, such as a stakeholder pension scheme, introduced a few years ago; meal vouchers, discounts of 10 – 15% on all products and customer services – particularly attractive to female employees, though not exclusively so – is a highly regarded hair salon;
• There is very little movement of staff around departments and appointments to more senior positions, e.g. Deputy Head of Department tends to be made from external applications; current staff can apply but they tend not to be successful due to inexperience or lack of qualification; there is no formal system of promotion;
• There is no provision for training and development and certainly no support, financial or otherwise, for any activity that could be described as ‘life-long learning’ or ‘continuous professional development’;
• The focus is on providing a quality service to the customer; there are no performance related payment rewards for exceptional performance other than perhaps a thank you from the Department Manager.
• There is an indication of a team working approach at Departmental level but this tends to be very informal, for example, employees covering each other or helping out when busy; there is no evidence of formally constituted teams or any training in team working or dynamics;
• No surprisingly the management structure and practices are very formal and to some degree autocratic (in the past the company has described its approach as ‘parental’ and very concerned with employee wellbeing);
• Younger staff tend not to remain with the company more than a couple of years; this is generally attributed to the unattractiveness of the retail sector although no consideration is given to the many staff who have been with the company for in excess of 10/15 years and why younger people joined the company in the first place; recruitment is generally focused on people with previous retail experience;
• There are no exit interviews
• The reward/pay system has remained unchanged for quite sometime – at least 10 years and is basically pay and some benefits – there is no performance element to the system except at Board level where Directors receive a performance bonus if their Department’s perform well.
• There is no evidence of any formal employee involvement or participation strategy and communication to staff tends to be through their Department Manager – a result from the ‘Directors/Managers meeting which takes place every 3 months; as there is no requirement to ‘cascade’ the results of this meeting to staff most managers don’t bother to inform their staff of the outcomes from this meeting – though some do!
• The are no formal or informal consultative mechanisms and as far as management is concerned it is inconceivable that employees would have anything positive to contribute to Business Strategy or related decisions making; although some employees have put forward ideas management have considered these employees as ‘trouble makers’ they have tended to be younger employees and have left for other employment.
• Generally staff are very happy with their ‘lot’ at least those who remain in the organisation. They are well paid, above the average for the sector and have a reasonable range of benefits. On the down side ambitious staff leave quickly as they see no opportunities for career progression and no provision within the organisation to help them gain experience beyond the level at which they are employed. In addition work is done at the speed of the slowest and those employees with a results orientation, recognising that there is not merit in achieving high sales as they are not rewarded for the effort or the result quickly fall into line with the prevailing practice which is to spend a lot of time ‘talking’ to customers whether or not a sale is achieved. One point of contention is that all male staff are expected to wear a dark suit, light shirt and tie and women are similarly attired but with a dark jacket, skirt and blouse. Women are not allowed to wear trousers unless there is a medical reason for doing so. Most employees, even some of the older people consider this an outdated an old fashioned approach.
• The company provide name badges.
• There is though a potential storm gathering on the horizon. Most staff have heard rumours of the root and branch review though none of the staff have been involved in this ‘review’ and clearly are feeling vulnerable. A consequence of this is that as HR Director you have received a telephone call from the local trade union full time officer during which she suggested a meeting with you to discuss staff anxieties and mentioned working together in partnership to create a harmonious and prosperous Business. You have put her off for the moment but you know that you will have to consider the related issues. Given the changes that are planned for Lamplight you are not keen to address this matter at the moment.
• The HRM Director who has only recently been appointed – the previous HR Director retired - has been tasked with the project of considering the ER issues and to recommend to the Board
• 1. whether the organisation needs to take a more strategic longer term view of its approach to people management, and
• 2. to identify and justify a relevant approach to how to carry out Employee Relations.
• The HR Director is expected to present an outline report to the board in the near future.

Description

This assignment answers the following questions on the case study –
As you have recently joined Lamplight Home and Fashions as the HR Director you are keen to improve Employee Relations. To achieve this your report should specifically address the following issues which you have identified:
1. What opportunities do the ‘root and branch’ review of operations and the expansion plans (which will go ahead) present for the modernisation of Employee Relations
2. Given the plans to diversify the retail operation what challenges do you envisage the organisation faces in order to achieve a ‘new and contemporary approach to ERs’
3. With particular reference to ‘employee voice’ (EV) develop an EV strategy for presentation to the Board; knowing that this will be an innovative and radical recommendation for the Board and Managers to accept focus the content of your comments on:
o how an ‘employee voice strategy’ will add value to the business and improve employee relations
o whether or not working in ‘partnership’ with a trade union would be ‘good for business.
4. Present in the form of an Action Plan (which you should place in an appendix to your report) your recommendations for the improvement of Employee Relations and how they can be implemented.