DAIRY-DELI-BAKE 2000

ANAHEIM, Calif. -- Wal-Mart Stores has taken a hard look at the labor situation and has launched a new strategy to retain its employees, said Kevin Harper, vice president of marketing and people, at the Bentonville, Ark., chain, said during the International Dairy-Deli-Bakery Association's 36th Annual Seminar & Expo here last week.Like other retailers across the country, Wal-Mart is finding it difficult

ANAHEIM, Calif. -- Wal-Mart Stores has taken a hard look at the labor situation and has launched a new strategy to retain its employees, said Kevin Harper, vice president of marketing and people, at the Bentonville, Ark., chain, said during the International Dairy-Deli-Bakery Association's 36th Annual Seminar & Expo here last week.

Like other retailers across the country, Wal-Mart is finding it difficult to recruit and retain associates when the unemployment rate is at a low of 4.1%, Harper said. He explained that the retail giant, after surveying its associates to find out why they leave, took a new tack by concentrating on keeping the employees it had.

"We keep things simple at Wal-Mart. The program comes down to three words: keep, grow, get. Five years ago, our priority was 'get,' but we changed that because we know we have to have our people long enough to train them to give our customers what they want -- quality, safety and consistency -- seven days a week," Harper said.

In its survey of employees, 70% of whom were leaving within the first year, Wal-Mart found that lack of recognition was a key to the exodus. To stem the outward flow, Wal-Mart first set about finding out the concerns of employees and then, store-by-store, looking to rectify them, Harper said.

Here are the five top reasons associates gave for leaving: 1. It doesn't feel good around here; 2. They wouldn't miss me if I was gone; 3. I don't get the support I need to get my job done; 4. I want to grow and I can't do that here, and; 5. I'm not rewarded appropriately for what I do.

"Measuring turnover and why it's happening is hard, but it's necessary to know where you stand before you can do anything about it," Harper said. He added that even a giant like Wal-Mart can attack the problem on a store-to-store basis.

"Associates don't leave an organization; they leave a supervisor," he said.

Addressing recognition of employees, Harper pointed out that Wal-Mart knows that personal recognition in today's fast-paced world is particularly important. In addition to citing employees for a job well done, the retail giant is taking a new look at all the concerns its employees say they have.

"For example, we've been working with an organization, Resources for Living [RFL], for a while. That's a program in which associates can make a phone call and talk to a counselor. We found [in categorizing those calls] that fully 51% of issues people called about were categorized as 'personal/family' and that figure went to 64% when it was management-level associates. Another 25% fell under the 'emotional' category," Harper said.

Only 15% of the concerns were work-related, the Wal-Mart executive pointed out.

"It's not terribly surprising that so many concerns were outside the workplace. With 43% being dual-earners, that presents child-care concerns, for one thing. And if you are short-staffed, don't you think that has an impact on an associate's family? There are the long hours and days off problems."

Those associates who have stayed at Wal-Mart have apparently had good coaching, training and support at their own store level, Wal-Mart found.

"They told us they're given the opportunity to learn new skills -- and where better than a Wal-Mart Superstore, with all its departments, including food, is there to learn new skills? They also told us they're coached, given feedback, provided with satisfying work, treated with respect and paid fairly," Harper said.

On the pay issue, Harper said Wal-Mart looks closely in each area at what other retailers are paying and makes sure its pay rate is up to par in that market. It levels the playing field so you know at least that it's not the salary rate that's causing people to leave, Harper said.

"Then, since you know it's not the money, you can look at what the other issues are. We have found that at stores where there's a stock purchase plan, retention is better," he added.

But there are a number of small rewards that associates value highly, Harper explained. "There's the 'Good Job' button, for instance. It's simple, but very successful," he said. He described how the button is presented by a home-office executive for out-of-the-ordinary service.

"Associates consider it important. If you asked them about the button, you can be sure they'd tell you what it's for, who gave it to them and when, and they'd be smiling all the time they're telling you."

But even for something as simple as that, it takes a supervisor or manager at store level to spot good work and see that it's rewarded, Harper emphasized.

"What it all comes down to is good leadership. When we [at particular stores] have had big problems with retention it almost always goes back to the leadership."

An example of easing outside concerns is to be sensitive to the days off people want and what holidays are important to them, Harper said.

"The 4th of July doesn't have the same importance for everybody. Their holiday of choice might be Cinco de Mayo or Martin Luther King's birthday."

On growth in the company, Harper also said it's important to let people know there are growth opportunities and what they are.

"Just recently, I've had associates and recruits ask me who the highest ranking Hispanic person is in the company and how many high-ranking women there are. It's important to let them know there is career-pathing, what's next for them and where they can go in the company," Harper said. The company does have thorough training programs, such as the Walton Institute, in place, but time sometimes gets in the way.

One of the hurdles a company as large as Wal-Mart has is that its fast growth often gets people promoted who haven't had enough leadership training, Harper said. The retailer has recently tapped into technology that will help it train from a central data base accessible at each store, the Wal-Mart executive explained.

The company has also instituted a toll-free application process in which potential applicants call a number and provide necessary data.