Blinds to Go Company Essay

Executive SummaryThe case, establish on the relay stationship Blinds to Go, emphasizes the importance of laging in monetary funds as they expand to visualize their growth objectives. organism a manu accompanimenturer and seller, with a anomalous gross sales model c% bursting charge musical themed and focus on customer service gave the all(a)iance an advantage over its competitors. According to the senior forethought Quality of cater was paramount and hence their original compensation system motivated high hat performance and fostered a high energy, sales hungry(p) culture at BTG.To draw out more recruits for its intricacy phase, the management changed the compensation system from plentiful commission to requital on the recommendation of a newly engage vice president. sales declined and the boilers suit stave swage increased. Seeing this the familiarity brought back the old culture and go through with(predicate) a sales turnaround. This conjure also cause d a nonher huge turnover in livestocks. A tumid percentage of voluntary turnover occurred in the first four months. The high turnover after eight months was partly due to termination because of sales performance.The biggest challenge the ships company now faced was understaffing. The need for additional staff was further aggravated due to its continued push for growth and the loaded US and Canadian labour markets. Another concern to be turn to was that the company had planned for 80 per cent of its expansion in US where the employees preferred the unyielding reach than the companys commission based pay social system. During this period BTG had tried several recruiting methods with varying degrees of success. With an IPO in the pipeline and plans to add on average 50 stores per year for the go oning(a) five years, it was critical for the company to come up with a staffing scheme with focus on Quality of the staff and low employee turnover.The CompanyBlinds To Go (BTG) was a retail fabricator of window dressings. It was started by David Shiller in 1954 in the Cote-des-Neiges district in Montreal, Canada. From the mid 1970s, BTG focussed on the sale of blinds. It was qualified to create a production system that reduced the obstetrical deli precise time frame of custom blinds from six to eight weeks to 48 hours. The reduced delivery time direct to overwhelming customer response and the business flourished. The unwavering, realising their unique advantage of universe a manufacturer and retailer simultaneously, began expansion by opening stores throughout Canada and US. By June 2000, BTG operated 120 corporate owned stores in North America. BTG pass judgment to add 50 stores per year for the next 5 years, 80 percent of which tar contained to US expansion stores.BTGs business school of thought was that quality of staff was cardinal than the store location, customer demographics or advertising. The firm established this by experimenting with a stor e that was locationally disadvantaged and had declining sales. BTG was commensurate to soprano the sales of the said store in one month by deploying their A management team and trained staff there. The four staff roles in BTG stores were 1. Sales associate 2. Selling Supervisor 3. Assistant storage manager & 4. come in Manager. Sales associates were the junior most employees and their job was to follow a set plan to sponsor walk in customers to fall in a purchase. Consistent sales performers among them were promoted to selling supervisors, who were assistant store managers in training, or assistant store managers. Assistant store Blinds to Go Staffing a Retail ExpansionCase AnalysisSECTION E root word 5 managers were in charge of the stores in the absence of store managers. The store manager was responsible for overall store operations. The BTG selling process intricate a high level of customer interaction, which set a very high level of service expectation. Their emphasis o n customer happiness and sale closure led to higher volume of orders relative to their retail competitionOriginal Compensation of Retail StaffThe compensation coordinate at Blinds To Go incentives performance based on telephone number of sales deal closed. The commission based bodily structure fosters the high energy, sales hungry culture at BTG. This structure was believed to be a motivating cistron to boost performance. High performers at BTG actually made more money than comparable retail outlet salesman.For Sales Associate the salary structure was a mix of fixed pay and inconsistent pay with $3 $5 comprising of fixed and 3% of sales as variable component.For Managers/Assistants the salary structure was $10,000 $15,000/yr as fixed pay with 1.5% to 3% of overall sales as variable pay.Changes in Compensation anatomical structure 1996As per the recommendations from a newly hired Vice President of store operations the compensation structure for the store staff was changed f rom being justy commission based to salaried. Under the new structure, the sales associated were paid Cdn $8 per hour as a fixed component. For the store managers a higher base salary component as comp ard to the commissions was set. The main focus of the move was to wanton the compensation more attractive to the prospective hires. Another change being brought was to limit the involvement of store managers in the sale process. All these changes had an unfavourable effect on the sales figures which showed a decrease of 10 to 30% from 1996 to 1997. The staff turnover increased to 40% from the earlier 15%. level thought the new pay structure championed in recruiting more hires, it led to the hiring of lower calibre citizenry.The existing good performers did not appreciate the changes, olibanum affecting their morale and hence their commitment to sales. To counter this adverse effect, the management introduced a variation of the commission based compensation plan in May 1998. The effect of the change could be seen in the 10 to 30% increase in store sales from the previous year. Still the BTG stores experienced a high employee turnover that year. It was probably because of the employees accustomed to fixed pay were leaving the organisation, being dissatisfied from the commission based structure. Analysis of the employee turnover reflected that the highest no of employees left the firm in the first 4 months from their hiring. most(prenominal) of the new expansion plans were in US. But the people of US were uneasy with the 100% commission based pay structure. Thus there was a requirement in the change to the structure to adapt to the US market.Blinds to Go Staffing a Retail ExpansionCase AnalysisSECTION E Group 5 ducts of RecruitmentTo be able to attract and recruit people who had certain sales contractn qualities, several convey of enlisting were harnessed to fill in the job positions. Since BTG was already short-handed and with massive growth plans (50 s tores per year ) lined up, we need to analyse the mingled pros and cons of the channels of recruitment. Employee Referral Current staffs refer friends and family to BTG which patroned company attract candidates already briefed on the companys ideology. This channel was very effective which is evident by its highest ratio of leads to hire. The success of the ER scheme was partially due to the fact that referrals generally continued employment excited by the opportunity that the friend or family member who is a BTG employee recounted. Though maximum hiring was effected through this channel yet this alone did not currently satisfy BTGs hiring needs.Internet Sourcing This is one of the non-store recruitment channels which BTG used in 2 ways. First, BTG solicited resumes at its blindstogo.com site. Second, DSMs and recruiters actively searched online jobs sites like Monster.com to contact potential candidates. soon 12 out of 143 recruits were through this channel. DSM Compensation Re adjustment DSMs were primarily responsible for store source of recruitment mainly walk-ins and employee referrals. They had to hire 10 new sales associate each month. Their importance in recruitment process is highlighted by the fact that their salary was based on number of new staff selected rather than on sales tar points. Currently 16 out of 143 sales associate were recruited through this channel in old two months.BTG Retail Recruiters They were professional recruiters who were paid 20000/year with a bounty of $150 -$500 for each successful hire. They generate leads through frore calls, networking referrals, colleges, job fairs, Internet and employment centres. Though they had performed sub- optimally in term of number of number of new recruits, their training had increased to enable to bond in at least 4 new recruits per week. Newspaper publicizing Newspaper channel generated the maximum number of leads but the senior management believed that this medium did not generate the quality of candidates that BTG needed. This channel attracted more of the people who did not meet the in demand(p) skills standard and core values expected by BTG in potential candidates. To be able to meet our desired staff requirements, we believe this channel needs to be harnessed to its full potential and complemented by necessary training to new recruits to enable them to meet companys performance standards.Store Generated Leads BTG believed in direct store walk-in mode of recruitment as well. It had put help valued signs on its windows to attract potential candidates to meet its recruitment needs. But this insurance policy was successful only in densely populated aras with high footfall. HR StrategyUdofia, Vice Chairman BTG, is looking for a strategy that solves all the major issues currently faced by the company, which would include unstaffed stores, staffing for future expansion and high employee turnover. Following are the steps that could be taken by him to achieve its growth objectives A Robust Training Module As mentioned, the quality of staff is extremely important in the retailing business. The grate in the labor market doesnt give the company a flexibility to choose Blinds to Go Staffing a Retail Expansion employees on a strict criterion.A training module would help BTG to unloosen the criterion and increase the number of selected employees by recruiting people who are trainable. In order to keep a check on the quality of the employees, the company can recruit the employees at a trainee level with a fixed pay. The training would be mostly on the Job led by experienced Store Managers. A review system would help these selected candidates to get promoted as Sales Associate. The initial pay as a trainee would be low. But the incentive to get promoted as Sales Associate would drive them to work and learn quickly.Currently we can see that there are large numbers of people who are attracted by the Newspaper Channel and Internet. But the prob lem is with this medium is that it didnt generate quality employee. By a robust training module the company would be able to hire trainable people and give them opportunities on the basis of their performance.The Promotion Structure A scheduled review and internal promotion structure could be followed which attracts the current employees and increases the retention rate. The review can be conducted on at 2 levels, Sales Performance and Soft skills. A feedback mechanism would help the employees to work on the areas they lag. The review can be scheduled every 8 months and every employee can be given an opportunity to get promoted.The internal promotion structure could be leveraged as a son of a bitch to advertise. This would attract people who currently dont want to link at Sales Associate Level. The promotion structure would also help in filling up the vacancies of Supervisors and Managers. Pay Structure The pay structure for Sales Associate could be revised in a dash as explained belowAccording to the current pay structure, a Sales Associate is paid $6-$8 per hour or 6% of sales, whichever higher. all the way it can be seen that the Marginal and the Poor performers are the once who are enjoying the fixed compensation system. In order to motivate them, fixed + variable compensation could be followed for these below par performers. This structure would demotivate the go performers as there will be a reduction in their salaries. So it would not be the best idea to implement this structure for top performers. A benchmark of $10000/sale/week could be set. This would not only motivate them to perform but the company also would pound the problem of social loafing. The structure is explained belowMarginal-Poor Performers ($10000-/sales/ week) $3 per hour + 3 % of sales Leadership Program The highly experiences set of Store Managers could be given an option to join the leadership course. Under this program the Senior Employees would take up the responsibility of the training module and help the company attain the level of quality it requires in its workforce. Their compensation could be based on the rate of conversion of trainees to Sales Associate quite of Sales. Increased Stock Options to senior and experienced Store Managers would give them a feel of ownership in the firm which is what an employee needs after dowery an organisation for years.