Driving Employee Engagement Through Human Capital Management Solutions

Savvy retailers know that an engaged workforce is key to driving customer satisfaction, operational performance, and ultimately, business success. In a recent examination of human capital trends, 85 percent of executives identified employee engagement as an important or very important priority for their organizations.2 But according to Gallup, only 26 percent of retail employees worldwide are engaged in their jobs.3

As the nature of the workplace continues to evolve, retailers’ failure to meet the needs of newer generations of associates could lead to higher than expected turnover — and negatively impact the customer experience. Yet finding the right tools to engage and empower employees continues to be a challenge.

With up to five generations of employees now working side-by-side, retailers must find a way to manage the diverse needs of the workforce, maintaining engagement among each generation to drive business success. Retail managers need easy-to-use, automated, and fully integrated solutions to meet the challenges of managing multiple generations in the dynamic, evolving retail environment.

An Answer in Human Capital ManagementHuman capital management solutions can help retailers meet the challenge of the multigenerational workforce by providing analytical insights that inform decisions and empower managers and associates. Retailers that are finding success using human capital management technology to manage their multigenerational workforce and drive engagement share a number of best practices:

• Using core HR, talent management, payroll, and workforce management systems together to make data-driven business decisions

• Putting employees in the driver’s seat when it comes to managing their workforce-related information with mobile and self-service capabilities

• Delivering the perfect paycheck by automating employee time and wage calculations

• Enforcing fair, consistent absence policies

• Proactively managing compliance risk with a single source of truth

• Creating best-fit schedules that account for business and compliance needs

Advertorial

1Tamar Jacoby, The Wall Street Journal, Wal-Mart Tests “‘Upskilling, September 4, 2015, http://www.wsj.com/articles/wal-mart-tests-upskilling-1441393973.2Deloitte University Press, Global Human Capital Trends 2016, at 4.3Gallup and Kronos, Rethinking Engagement: How to motivate a disengaged team when the odds are against you, Webinar conducted 6/23/15.

Retail managers face a reality in which standard turnover is 50 percent in the first six months and the replacement cost can be

as much as $5,000 per front-line worker —

20 percent to 30 percent of an entry-level salary.1

With greater visibility into the workforce, human capital management solutions can help retailers focus on three key areas:

• Attracting and retaining top talent

• Effectively managing a multigenerational workforce

• Minimizing compliance risk

Finding the Right People: Attracting and Retaining Talent The human capital management life cycle begins with recruiting and hiring talent. As more organizations make the connection between hiring the right people and achieving success, leaders are increasingly approaching recruitment and hiring as a crucial competitive differentiator.

With an improving labor market and available talent spread across multiple generations, the challenge to recruit and hire the best workforce for the job has never been higher. And the best talent isn’t looking for just any job — top performers want to work for top-tier retailers that are perceived as employers of choice. To build an irresistible organization, retailers will not only need to have real-time views into how engaged their employees are but also adopt new ways of involving the workforce in addressing operational challenges such as scheduling and staffing.

Retail managers face a reality in which standard turnover is 50 percent in the first six months and the replacement cost can be as much as $5,000 per front-line worker, or 20 percent to 30 percent of an entry-level salary.4 It’s no wonder that retention is important to a company’s bottom line.

With employers looking for talent in a multigenerational workforce, they must think about recruiting in new ways and work to leverage technology and sourcing strategies that improve hiring and reduce turnover. Human behavior may be unpredictable, but analytics can help retailers make better hiring decisions. By identifying the right skills, competencies, behaviors, and tendencies, managers can ensure that the best candidates are hired. And by streamlining the hiring process, they can find that “needle in a haystack,” allowing them to compete more effectively in a tight talent pool.

4Tamar Jacoby, The Wall Street Journal, Wal-Mart Tests “Upskilling, September 4, 2015, http://www.wsj.com/articles/wal-mart-tests-upskilling-1441393973.5Deloitte Development LLC, Retail Talent Disrupted, 2016, at 15.

With employers looking for talent in a multigenerational

workforce, they must think about recruiting in new ways and work to leverage technology and

sourcing strategies that improve hiring and reduce turnover.

Only 7 percent of Millennials

perceive work in retail as engaging.5

Making It Work: Managing a Multigenerational Workforce We are currently at an interesting point in history, one where five generations of employees are working together. A workforce made up of everyone from high school students to experienced employees working past the typical retirement age presents a unique challenge for managers. By 2025, Millennials will account for 75 percent of the global workforce.6 Today, by comparison, Millennials represent only about 34 percent of the workforce.7 According to a recent Workplace Forecast by the Society for Human Resources Management, 52 percent of leaders say that developing the next generation of leaders will be among their greatest challenges, particularly as Baby Boomers exit the workforce in large numbers.8

While it’s important to remember that each employee is unique — with his or her own goals, motivations, and attitudes — generational labels can be useful tools for characterizing workers and creating strategies to manage a multigenera-tional workforce. The Baby Boomers’ “live to work” philosophy gave way to Generation X and their “work to live” outlook, which is now being replaced by the Millennials’ “work my way” viewpoint and Generation Z’s desire to “make a difference.”

By understanding what’s personally important to employees, managers will be better positioned to support employee engagement. Recognizing the work-life balance demands faced by older workers and making accommodations to keep them in the workforce will retain their leadership skills and vast institutional knowledge. At the same time, it’s important to acknowledge that Millennials and Generation Z have grown up in a world transformed by technology and therefore naturally approach work differently.

Younger generations respond particularly well to technology tools like mobile and web-based self-service, which have the added benefit of increasing workforce engagement. Employees like the freedom of checking their schedules from anywhere, requesting time off, or swapping a shift with a coworker. And managers are freed from their desks so they can coach associ-ates or work on other, more strategic initiatives.

Human capital management solutions allow you to manage the strengths, weaknesses, needs, and personalities of all employees, no matter which generation they are a part of, to elicit the best performance and results. Retailers need a solution that helps managers navigate these challenges and provides insight into how their decisions are impacting business performance.

6 Dan Schawbel, 74 Of The Most Interesting Facts About The Millennial Generation (June 25, 2013), found at http://danschawbel.com/blog/74-of-the-most-inter-esting-facts-about-the-millennial-generation/.

7 Richard Fry, Millennials Surpass Gen Xers as the Largest Generation in U.S. Labor Force, Pew Research Center (May 11, 2015), found at http://www.pewresearch.org/fact-tank/2015/05/11/millennials-surpass-gen-xers-as-thelargest-generation-in-u-s-labor-force/.

8Society for Human Resource Management, SHRM Workplace Forecast: The Top Workplace Trends According to HR Professionals (May 2013), at 7.9Deloitte Development LLC, Retail talent Disrupted, 2016, at 15.

With employers looking for talent in a multigenerational

workforce, they must think about recruiting in new ways and work to leverage technology and

sourcing strategies that improve hiring and reduce turnover.

Research shows that retailers who place a high value on

talent by investing in higher wages, improved training

and development, and clearly defined future opportunities will likely attract and retain the type of talent needed to remain competitive.9

Only 7 percent of Millennials

perceive work in retail as engaging.5

Avoiding Liability: Ease the Compliance ChallengeManaging an unpredictable compliance environment continues to be a hot topic for retailers, especially with state and federal agencies’ recent focus on aiding low-wage workers. The Department of Labor has recovered nearly $1.6 billion in back wages since 2009, increasing the need for retailers to take concrete steps to avoid costly penalties and stay on the right side of the law.10 From the recently announced overtime changes to the Fair Labor Standards Act to a push for fair schedules across the country, navigating the increasingly complex regulatory environment can be a significant challenge.

Human capital management solutions give you a robust set of tools for managing compliance across the organization and make the task of adhering to and managing compliance requirements easier and more accurate. Employee information is thoroughly documented from a single source and a common reporting engine to help ensure all policies are being applied correctly and consistently.

The fair application of workplace policies helps retail organi-zations drive employee engagement and improve retention rates. Wage and hour policies are applied the same way every time, eliminating human error and simplifying the complex-ities around managing, measuring, and paying your hourly workforce. Policies are enforced accurately and employees know they are being treated fairly.

Conclusion: Your Associates MatterEmployees play a critical part in the success of your retail organization. When asked, 94 percent of retail executives said the role of associates was very or extremely important to achieving performance goals.11 Having a human capital management solution in place for recruiting, hiring, and managing a multigenerational workforce and meeting the associated compliance challenges delivers an important competitive advantage.

How Can HCM Make a Difference for Your Organization?Learn more about how Kronos can help retail organizations drive employee engagement and business success using human capital management solutions. Visit www.kronos.com/hcm today.

© 2016, Kronos Incorporated. Kronos and the Kronos logo and Workforce Task Management is a trademark of Kronos Incorporated or a related company. For a full list of Kronos trademarks, please visit the “trademarks” page at www.kronos.com. All other trademarks, if any, are property of their respective owners. All specifications are subject to change. All rights reserved.

Kronos Incorporated 297 Billerica Road Chelmsford, MA 01824 +1 800 225 1561 +1 978 250 9800 www.kronos.com

10Working for a Fair Day’s Pay. U.S. DOL, https://www.dol.gov/whd/statistics/.11RIS News, “The Employee Engagement Imperative” (sponsored by Kronos Incorporated, 2016)

The Department of Labor has recovered nearly $1.6 billion in back wages since 2009,

increasing the need for retailers to take concrete steps to avoid costly penalties and stay on the right side of the law.10