Basic Outlet Stores has been on an exponential growth trajectory since opening its first store in 2010. The company was opening an average of one new store per year and planned to add nine more in the next couple of years, but its HR function couldn’t keep up with the pace. The existing workload overwhelmed the HR team and they were unsuccessful in multiple attempts to transform the department.
Top management realized that the HR department didn’t have the capability nor the capacity to evolve into the strategic partner the company needed. Basic Outlet Stores hired Omcore Consulting to restructure the HR department and redesign its entire people operations.
1. The Situation
When Basic Outlet Stores decided to start an HR department, they put together a team from existing employees who didn’t have prior experience or formal education in human resources. The team learned on the job, through trial and error, but were unable to keep up with the company’s growing demands and fast pace.
Management decided to hire experienced HR Managers to support the department and enhance its operations, but none of them were effective and eventually left the company.
The Omcore team conducted a thorough assessment of the HR operations and interviewed key stakeholders in the company. We were able to identify the following challenges:
- The HR department was mainly occupied with data entry, administrative HR tasks, and recruitment sourcing and screening. The team relied on spreadsheets and paper documents to accomplish their work.
- Policies, procedures, and workflows were not consistent, which led to ineffective people operations.
- The company did not have a talent pool of candidates to choose from in order to speed up the hiring process. Recruitment was reactive although the company’s growth demanded continuous talent sourcing.
- Basic Outlet Stores struggled to attract high-quality talent although the company is a leader in the market. Management raised salaries on multiple occasions to attract more qualified candidates but without success. The employer brand did not accurately represent Basic Outlet Stores.
- Performance appraisals were based on open-ended questionnaires that were subjective in nature and couldn’t identify staff development needs.
- The HR team lacked the knowledge and expertise to support the company moving forward. Changes to the HR team were needed along with intensive training and development.
2. Our Approach
Top management approved Omcore’s baseline schedule and its milestones. In order to mitigate the company’s growth strategy, we focused on the following components throughout the project:
Automation
In order to eliminate the administrative overload in the HR department, we focused on automating all recurring tasks with the help of software.
Digitization
The HR function needed to shift from paper-based to digital operations in order to increase efficiency and have time for more strategic responsibilities.
Cost Consciousness
Outlet retail is a low margin industry that relies on high volume sales to remain sustainable. We ensured that our proposed solutions had the highest possible return on investment.
Implementation Support
Given previous failures, the company needed full professional support throughout the implementation stage.
3. The Solution
The project started with a complete restructuring of the HR department. We redefined the existing job roles and created new positions which were filled through external sources. Our team performed a job analysis study by administering an online questionnaire to all employees and following-up with interviews where needed. Job descriptions were drafted to include duties, responsibilities, reporting lines, competencies, and job requirements.
HR policies and procedures were developed for all functions within the HR department. Processes and workflows were delivered in Microsoft Visio format using BPMN 2.0 to facilitate software implementation down the road.
Our team developed a recruitment strategy with a long term action plan to build Basic Outlet Store’s employer brand and employee value proposition (EVP). Our strategy defined a clear EVP, recommended recruitment sources, candidate evaluation criteria, recruitment metrics, and an onboarding program structure. We also designed the wireframes for a new career page to improve sourcing through Basic Outlet’s company website.
In collaboration with top management, we set a performance management strategy and developed KPIs for all positions within the company. The new performance system focused on objective measures and job-specific competencies for evaluation.
We performed a market salary survey for retail sales positions to benchmark Basic’s compensation and benefits against the competition. The findings allowed us to make some adjustments to the compensation and benefits scheme and introduce pay-for-performance incentives. The new compensation strategy reduced fixed payroll expenses and incentivized employees to achieve their KPI targets.
Then, we administered psychometric assessments to identify existing competency gaps. The results enabled our team to prepare a training needs analysis report and highlight the areas that require immediate development.
Upon completing the project deliverables, we worked closely with Basic Outlet’s ERP provider to build a custom HR application that fits the company’s needs. Our team defined the functional requirements and participated in multiple rounds of testing before approving the final software version.
Due to the success of the project, Basic Outlet Stores contracted Omcore Consulting to fully manage HR operations and advise on strategic decisions on a retainer basis.
Project Scope of Work
- On-premise assessment of existing HR operations
- Prepare HR audit report with a recommended action plan
- Design a functional structure of the HR department
- Define HR job roles and assess the fitness of existing HR employees
- Recruit senior HR professionals to the HR department
- Administer online job analysis questionnaire
- Conduct follow-up interviews with employees
- Develop a competency framework with proficiency levels and definitions
- Map competencies and proficiency levels to each job role
- Draft detailed job descriptions for all positions
- Validate job descriptions with relevant stakeholders
- Develop HR policies and procedures for all HR functions
- Create process maps for each HR function with detailed workflows and procedures
- Administer recruitment strategy assessment questionnaire to relevant stakeholders
- Prepare recruitment strategy assessment report and discuss with top management
- Develop a recruitment strategy in alignment with Basic Outlet’s corporate strategy
- Define the Employee Value Proposition (EVP) and associated communication plan
- Recommend recruitment sources for each job family
- Define recruitment metrics to track the strategy’s performance
- Design career page wireframe for Basic Outlet’s corporate website
- Create a performance management system to include competencies and KPIs
- Develop a KPI library to include all employee performance indicators at Basic Outlet Stores
- Design performance scoring system and generate performance appraisal template
- Conduct market salary survey in the Lebanese market
- Develop job evaluation model and perform job ranking using a point factor system
- Benchmark job roles to market salaries and make recommendations
- Build a salary scale and grading structure with pay-for-performance incentives
- Define benefits package per job role
- Administer competency-based assessments to all employees
- Prepare skills gap analysis report by the department
- Submit recommendations for training and development plan
- Define HR software requirements for the company
- Submit software functional requirements to ERP provider
- Test HR software in collaboration with ERP provider
- Assist ERP provider in implementing and testing the HR application before go-live
The final project deliverables enabled Basic Outlet Stores to:
- Implement a clear HR strategy that will enable growth
- Improve the efficiency of the HR department by reducing the administrative work through HR digitization and workflow automation
- Enable strategic decision-making using HR metrics and analytics
- Improve the quality of talent sourcing by communicating their EVP
- Optimize HR operating costs by monitoring various KPIs
- Set a training and development plan for all employees based on evidence
- Evaluate employees objectively and offer performance-based incentives