Problem:
While out shopping, you decide to stop in at a friend's business, Leah's Bakery. Leah recognized you and invites you into her office. She is eager to talk about her work, and in the conversation that follows, she tells you that she is about to mark the second anniversary of what has turned out to be a remarkable business, In terms of the breads, pastries, and other baked goods, customers cannot seem to get enough. That's an encouraging sign for this business. On the other hand, Leah has the feeling that she is working harder than is ideal and that the bakery is less profitable than expected. Though Leah may be right, I wonder on what she bases her assessment of profitability. Being a people-oriented person yourself, you pick up Leah's comment on her difficulty in finding good employees. The following aspects of Leah's Bakery emerge:
1. It takes fifteen employees to staff the bakery for a full week.
2. Leah defines six different positions: two bakers (pastries and breads), one cake decorator, a retail clerk, and a shift supervisor who also works behind the counter.
3. Leah has employed 240 people in the two years of operation. The shortest tenure was two hours and the longest was twelve weeks. Apparently, turnover is a major business problem.
4. Pay for the employee's ranges from $5.15 per hour (retail clerk) to $8.50 per hour (shift supervisor). There are no benefits. I now wonder apart from salary, what other incentives there are to work at Leah's Bakery.
Having 240 employees within a two-year period seems to you extraordinary; it represents an 800 percent turnover-equivalent to a new set of employees every six weeks. Yet the information Leah has provided jibes with your observations. Even though you visit the bakery at least once a week, you seldom see familiar facts. faces? The help wanted sign is a permanent fixture in the front window. On several occasions, you have even seen the shift supervisor interviewing applicants at the end of the counter. As a frequent customer, you have noticed the employees are pleasant and obviously are tying trying their best. At the same time, they frequently do not appear to understand certain common aspects of their jobs, for example, the functions of the cash register, how to enter special orders, the schedule for baking, ingredients of special items and so forth. On quick reaction, this could be either or both a training issue or a selection issue.
1. What are some possible causes of the high turnover Leah's Bakery is experiencing?
From this brief and troubling description, we don't know some important things about working for Leah's Bakery. These include: what kind of people does Leah seek to hire? Where does the bakery find such people? At the core, what does the bakery offer its employees? Here, I'm not just talking about money. What do employees want from work?
2. If you were asked to help put human resources on a more even footing, on what HR activities would you concentrate? First and foremost, I'd get the answer to these questions. Then I'd do some research to find out how other similar retail establishments do. I visit a local bakery. Their few employees seem to stay with the bakery for some time. I'd find out why.
3. What are three or four human resource programs Leah could implement to reduce the high turnover?