Jet.com overview and description
Discuss about the Human Resources Key Performance Indicators.
The human resources department (HR) has to be perceived as a strategic business partner by the organization. The organizational strategy could be pursued when its employees possess their adequate roles. The HR strategy should fill the performance gap and align with the organizational strategy (Mitsakis 2014).
Marc Lore founded Jet.com to create a club-type model of membership in the e-commerce space. The startup company targets the Millennial customers. It uses heavy marketing campaigns to attract customers and enable them to select the lowered price products of their choice (Chuvpilo et al. 2017).
The following sections shed the light on the HR plan of Jet.com, the e-commerce startup company.
Jet.com was founded in July 2013 by Wharton alumnus, then it was acquired by Walmart Stores, Inc. in August 2016 (Chuvpilo et al. 2017). Walmart wanted to make its online business more attractive to the Millennials and compete with Amazon by acquiring Jet.com.
Jet.com was built on three core values: transparency, trust and fairness. Its mission statement is to empower customers and associates (Walmart 2017). It is aligned with Walmart mission statement to be the best retailer in the consumers and employees’ hearts and minds. The company benefits the customers by saving money and the employees by earning wages. Walmart’s mission statement is to save consumers money in order to have a better living (Ferguson 2017).
At Jet.com, the HRM creates the climate that helps employees achieve the highest level of performance. It matches the employees’ talents to the business needs. The HRM focuses on innovation and cares about the employees at the same time (Walmart 2018). The company has invested to increase the associate wages, pay and training. Also, it devotes its efforts to add new technologies that simplify the processes (Walmart 2017).
Walmart has many stakeholders, however, a number of them have a significant impact on the company decisions. The company stakeholders are highly involved in the strategic orientation of Jet.com. They influence the company to fulfil their interests. They are grouped according to their priority to the company wages according to Meyer (2017), as follows:
- Investors:They seek more profits to increase the earnings per share. They also seek to minimize the operational costs that leads to wages minimization.
- Customers:They are interested in consuming lower price products of good quality. The company adopts a cost leadership strategy that provides the lowest prices.
- Employees:They come in the third priority to the company. They are significantly considered in the company’s strategy. It maintains their job security and increasing wages.
- Suppliers:They are at the least priority of the stakeholders. Supplier seeks to maximize their profits by getting their products sold
- Internal analysis
- Strengths
- Staffing:com has been hiring temporary employees or ‘flexible associates’since 2016 as part of the Walmart HR strategy. It used to hire both full-time and part-time workers. This new hiring policy ensures cost-cutting and the availability of sufficient workers in the busiest days (Reuters 2016).
- A wide range of products:The company sells a wide range of products compared to its competitors (Marcilla 2014).
- Weaknesses
- The cost cut policy:It has a negative impact on the wages of the employees. It has resulted in poor work conditions (Marcilla 2014).
- Not following a differentiation strategy: Unlike its competitors, the company only considers the prices, not the customer preferences (Marcilla 2014).
- High employees’ turnover rate: Employees leave their jobs as they find a better opportunity (Marcilla 2014).
- External analysis
- Opportunities
- The labor market: The labor market conditions led Jet.com to depend on temp workers. The U.S. unemployment rate recorded 7.6% in May 2016 and the number of people leaving their jobs also increased (Reuters 2016).
- Investment in international operations: com has the ability to expand its operations at a faster rate (Marcilla 2014).
- Threats
- Keeping the market share:com has a problem in improving its operations because of the conflict of interests (Marcilla 2014).
- Increasing competitor’s power:com has to keep an eye on its competitors, for example, Amazon, Tesco and Kroger (Marcilla 2014).
As an Affiliate and partner with Walmart, Jet.com applies the HRM Job analysis and design of Walmart. The organizational structure is a hierarchical functional structure. The HR can specify the job requirements easily. There are clear lines of authority, communications and command (Thompson 2017).
Jet.com mission statement
The company decided to make all of its products in the retail stores available online through Jet.com and its website. The company is accused of its stiff tactics to prevent labor unions. Moreover, it asks young employees to work in the late night and not providing them with meal breaks (Marcilla 2014).
The HRM forecasts the needs of its employees to ensure that enough capacity is available to meet the changing demands of consumers. There are three systems used in forecasting, according to Thompson (2017), as follows:
- Bottom-up approach: It starts at the lowest levelof the organizational structure. The HRM function is to ensure an adequate number of employees at all of the organizational levels. The process starts with forecasting the frontline employees, then an analysis is conducted at the highest level in the organizational structure.
- Trend analysis: It is used by the HRM to predict the HR needs of employees based on the current needs. It also considers the organization of future expansion plans.
- Delphi method: It uses the expert opinions to decide the HR needs.
The HRM is responsible for balancing the supply and demand by managing the recruitment efforts. According to Thompson (2017), the HRM uses different procedures as follows:
- Changes in recruitment: Is the main procedure used by the HRM. It changes recruitment according to the workforce requirements. This could be done without affecting the financial performance.
- Changes in compensation: It is used by the HRM to minimize the changes in the compensation strategy.
The HRM does not pay much concern to the shortage of employees. It adopts different processes to ensure no shortage or surplus in employees, according to Thompson (2017), as follows:
- Sales performance analysis: The HRM depends on monitoring the change in the sales performance as an indicator of its needs.
- Turnover rate analysis:The HRM monitors the turnover rate and the recruitment rate to manage the size of the workforce.
- Gap analysis: It is an efficient tool that enables the HRM to manage the gap between the needs and the actual capacity of the HR.
The HRM implements three strategies to manage people, according to Marcilla (2014), as follows:
- Motivation:Through making people happy and feel part of the organization. Cash intensive plans and health care insurance are among the motivations.
- Promotion:Many learning programs were developed to enable the employees to escalate to higher positions. It also promotes women to managerial positions.
- Hiring business owners:Small business owners are hired to maintain creativity within the company.
According to Iveta (2012), the effective KPIs should be ‘SMART’ or specific, measurable, attainable, relevant and time-bound. In Jet.com, the following are the KPIs for HR according to Thompson (2017):
- The turnover rate
- The placement time
- The average time of training per employee
- The average salary
- Staffing efficiency
Jet.com focuses on investing in its employees. Most of the employees are hourly associates. Walmart set a budget of $2.7 billion to invest in the employees training and development (Hardiman 2017).
The company invests in technology to facilitate online shopping. The company offers the online grocery services and pickup. The associates are equipped with tablets and handhelds to serve the customers effectively. They represent the frontline that deals directly with the customers (Walmart 2017; Solís, Masanell & Tatjé 2012).
Monitoring and evaluation of the HR plan take place at each planning stage. The process has to balance the supply and demand through recruitment. Also, the employee performance is closely monitored to leave no space for low performance (Marcilla 2014; Thompson 2017).
Conclusions
At Jet.com, the HRM creates the climate that helps employees achieve the highest level of performance. The company stakeholders are highly involved in the strategic orientation of Jet.com. They influence the company to fulfil their interests. Jet.com applies the HRM Job analysis and design of Walmart. The organizational structure is a hierarchical functional structure.
Jet.com focuses on investing in its employees. Most of the employees are hourly associates. The company invests in technology to facilitate online shopping. The company offers the online grocery services and pickup.
References
Chuvpilo, G, DiClemente, R, Mulani, S & Reisz, P 2017, ‘Corporate development, mergers and acquisitions’, Warton University of Pennsylvania, USA.
Ferguson, E 2017, Walmart’s vision, mission, generic & intensive strategies, viewed 27 July 2018, <https://panmore.com/walmart-vision-mission-statement-intensive-generic-strategies>.
Hardiman, S 2017, Walmart annual meeting emphasizes investment in employees, viewed 27 July 2018, <https://www.nationalskillscoalition.org/news/latest/walmart-annual-meeting-emphasizes-investment-in-employees>.
Iveta, G 2012, ‘Human resources key performance indicators’, Journal of Competitiveness, vol 4, no. 1, pp. 117-128.
Marcilla, B 2014, ‘Business analysis for Walmart, a grocery retail chain, and improvement proposals’, Southeast Missouri State University, USA.
Meyer, P 2017, Walmart’s stakeholders: Analysis & recommendations, viewed 27 July 2018, <https://panmore.com/walmart-stakeholders-analysis-recommendations>.
Mitsakis, F 2014, ‘Human resources (HR) as a strategic business partner: Value creation and risk reduction capacity’, International Journal of Human Resource Studies, vol 4, no. 1, pp. 154-170.
Reuters 2016, Wal-Mart’s everyday hiring strategy: Add more temps, viewed 27 July 2018, <https://www.denverpost.com/2013/06/13/wal-marts-everyday-hiring-strategy-add-more-temps/>.
Solís, H, Masanell, R & Tatjé, G 2012, ‘Business model evaluation: Quantifying Walmart’s sources of advantage’, Harvard Business School, USA.
Thompson, A 2017, Walmart’s HRM: HR planning, job analysis & design, viewed 27 July 2018, <https://panmore.com/walmart-human-resource-management-planning-job-analysis-design>.
Walmart 2017, ‘Annual report’, Walmart, USA.
Walmart 2018, Corporate human resources, viewed 27 July 2018, <https://careers.walmart.com/corporate/human-resources>.
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