John Lewis is major UK department store with 23 shops across the country. An article entitled ‘The ethical route to service quality at John Lewis Partnership’ by Dandy (1996) discusses the company and its high level of customer satisfaction. Its employees deliver exceptionally high standards of service which is largely due to the fact the John Lewis is a good manager of its people. The article thinks this is true because John Lewis follows the authors view of good human resource management to achieve the best customer service which is quoted below: “…
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To achieve a consistent high level of quality and customer service it is essential that all staff feel valued, that they are well treated, well trained and given a sense of confidence and responsibility. It is no good just saying that either – money does matter. Unless you have a fair wages policy and do not build resentment by only giving the cream to the already fat cats, then forget it” (Dandy, J. 1996. p17) John Lewis meets all these criteria. Firstly, it is offers excellent tangible benefits to its employees. It is a public limited company which means all its employees are shareholders in the company.
This means that not only do the staff feel valued, but they receive hard tangible benefits in the form of shares which are essentially money. Essentially, the employees are having shares given to them, but this also means that how hard they work is directly responsible for how much their shares are worth. For example, a Guardian online article (The Guardian 2007) noted that 68,000 John Lewis employees received the equivalent of 8 weeks pay as a bonus for the back of a leap in profits. Also, the company offered employees a pension scheme and medical care.
Going back to Starbuck’s Howard Shultz’s theory, if employees do not feel valued they will not feel financially or spiritually tied to their job. So far John Lewis has made sure its employees feel financially tied to their job through the public limited company and tangible benefits, but it still has to tackle the ‘spiritual side’ with intangible benefits. Boella (2000) discusses that due to nature of the service industry, there are many intrinsic problems that are unavoidable such as working evenings and working over holidays. These are factors which can contribute to high staff turnover and increased absence.
However employees at John Lewis receive flexible working hours and flexible leave which contributes to employee motivation and low staff turnover (John Lewis Partnership 2007). Offering competitive salaries and benefits is extremely important for holding onto and attracting the best employees for an organisation (Rosenfeld 1999). Personnel Management do this internally, by assessing what has been offered within the company and trying to match it. However, the Human Resource Management method of competing is out with the organisation against external competitors.
A modern approach to competing for staff is to offer more than other similar companies would offer . John Lewis have adopted this approach by offering employees a pension scheme which is now unique in retail and a strong contributory factor to recruiting and retaining employees. With all these factors combined, John Lewis could be said to be at the forefront of people management and have exactly the right method in place to look after their employees and hold onto them as well as their customers. As discussed before, good people management means motivated staff and in turn, happier customers.
John Lewis have done this an as a result, have loyal customers who will continue to provide business for the years to come. An example of how customers feel about the level of service at John Lewis is shown in this quote from the Scotsman Newspaper’s website in response to the announcements of further profits this year by the company: . “… I do believe that John Lewis gives value and good customer service… on the whole they are happy to answer questions/tell you about a product without being pushy. They are also good on the after sale as if you have a problem they accept it and deal with while others tell you to contact manufacturer.
I’ve shopped there for years and will continue to do so. While you want the best price I feel they charge a fair price but include good customer service especially in the white goods department… Well done Id say to them on good sales…… and to people thinking about value for money. ” (Scotsman 2007) According to the article (Dandy 1996) John Lewis sticks to the same principals as it first started which is “… Treat the staff right, and they – in turn – will treat the customers right (Dandy, J. 1996. p. 19). ” However not all major companies like John Lewis stick to these principals like they would be expected to.
An article about the major UK supermarket ASDA by Clement (2005) discusses how the company cut employees discount on everything other than food right before Christmas. Employees were entitled to a 20 percent discount previously to everything in the store which they would make use of, however ASDA decided to withdraw this liberty and reduce the discount to just ten percent. The article also notes that around 30,000 ASDA employees were not shopping for their own food at the store and Unions claimed that “staff morale was at an all time low” (The Independent 2005).
Reducing the discount upset employees and therefore would reduce their feeling of any loyalty to the company and their motivation to work hard especially at the busiest time of the year for the supermarket. This is why the HRM approach of nurturing staff and working in harmony with them for the better of the company is the best approach. Many academics who write about the arguments between Personnel Management and Human Resource Management have noted significant difference between the two approaches.
This essay was in turn, to compare and contrast the two methods and ultimately decide upon the better of the two. However, after looking into the two methods in details and in practice, the ideal that they are much of the same thing, interchangeable and indistinguishable (Cole 2002) has many supporting reasons. In truth, the terms ‘Personnel Management’ and ‘Human Resource Management’ could very easily be used to describe any kind of Human Resources Department and not be accused of being used incorrectly, apart from in America where HRM is the official name for human resources.
Many organisations who are seen as using a HRM approach to management , such as John Lewis, still call their human resources division the ‘Personnel Department’. As mentioned at the beginning of this essay many organisations either advertise for Personnel Managers or Human Resource Managers, but this does not mean they expect somebody who will manage in a hard and legalistic way as opposed to a soft, nurturing way or vice versa. Managing people in organisations has had to change with the times and the transition from using one term less frequently has come naturally as a way of showing a widespread acknowledgment of change.
The only main reason for any difference in Personnel Management and Human Resource Management is the different working environments in which they were used in and how effective they are within them. Personnel Management was, at the time, the most appropriate method of management. Political issues such as Trade Unions and the lack of employment law for individuals meant that the basic features of Personnel Management such as recruitment, selection, mediation and dismissal were all that was needed for human resources within a company.
The basic functions of Personnel were enough to ensure the smooth running of an organisation at a time when organisational goals and customer satisfaction were not at the forefront of managerial responsibilities. Human Resource Management is a way managers manage in the climate where they are now able to focus on business goals and customer satisfaction. Changes in employment law means individuals are protected by law and there is less need for Trade Unions.
This means managers can focus on working with employees for the better of the organisation and build less legalistic relationships by using good training, offering competitive benefits, putting more focus on teamwork and like John Lewis has done, making them feel part of the organisation and less like somebody who is just working for it.
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