enmploy turn over

Employee turnover measures the rate at which employees leave

their employer, usually over a one year time period. The statistics

indicated that Harrods needed to take action to improve employee

engagement and reduce its employee turnover. A high employee

turnover rate has significant cost and performance implications to

a business. These include the costs of recruitment, the loss of

expertise and the increased need for training new employees.

Following this investigation, Harrods carried out its first

comprehensive employee survey to find out what they thought

about working at Harrods. The employee survey has now become

an integral aspect of Harrods’ Human Resource Management

programme. The survey results were used to create strategic

plans for change focused on improving employee engagement

and trust. The four main elements were:

• Changing organisational structure. Senior managers felt that

the organisation was too hierarchical i.e. had too many layers.

The new structure is flatter with employees taking on more

responsibilities. This enables job enrichment, providing

opportunities for an employee to take on further responsibilities

to enhance their job satisfaction.

• Changing leadership. Creating an environment where

employees are encouraged to make more decisions

themselves. Senior managers create the business vision but

ground level employees are delegated more leadership

responsibilities, for example, in dealing with customers. The

model employed is one of transformational leadership where

the vision is built at the top but everyone engages with the

vision through personal leadership.

• Improved communications. Better communications inform all

employees about the strategies of the company. These outline

the aims and direction of the business. They also inform

employees about operational (day-to-day) plans which directly

affect their work. A radical improvement was to encourage

employees to inform management of their views.

• Living the brand values. Making sure that everyone

understands and models the brand values.

Communications and cultural change

The changes mentioned before have resulted in Harrods

developing a people-focussed culture in order to better engage

with its employees. The culture of an organisation is very powerful

and has been described as its DNA. It has also been summarised

as ‘the way we do things around here’ and is created through

shared values, attitudes, beliefs and norms. One of the reasons

why Harrods is so successful today is that it gives its employees a

voice for change. All employees are encouraged to give feedback

on every aspect of how Harrods operates. The opportunities for

managers and employees to be engaged in sharing their views

and ideas is summarised in the table below:

Engagement method Description

Internal employee magazine ‘Your Harrods’ - a popular and

creative magazine for employees

with a new starter list, interviews

with key people, personal snapshots,

charity features, an Agony Aunt

column and interesting competitions.

Morning briefing Informing shop floor teams about

what is going on that day and the

latest sales statistics.

Intranet Enables sharing of information with

employees. Employees are able to

select which aspects they focus on

(rather than having information

pushed on them).

Quarterly employee forum A group made up of employee

volunteers. Enables employees to

present issues and contribute to

company strategy.

Other forms of employee ‘Bright Ideas’ scheme which

voice encourages employees to share

innovative ideas to further improve


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