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Karstadt Vs. J.C. Penney


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Karstadt Vs. J.C. Penney

  1. 1. Case Study Karstadt vs. J.C. Penney
  2. 2. Case Context <ul><li>Andreas Drauschke and Angie Clark work comparable jobs for comparable pay at department stores in Berlin and suburban Washington D.C. But there is no comparison when it comes to the hours they put in. </li></ul><ul><li>Mr. Drauschke’s job calls for a 37-hour week with six weeks’ annual leave. His store closes for the weekend for at 2p.m. on Saturday afternoon and stays open on evening each week- a new service in Germany that Mr. Drauschke detests. </li></ul>
  3. 3. Case Context <ul><li>Mr. Drauschke is a 29-year-old supervisor of Karstadt, Germany’s largest department store chain. </li></ul><ul><li>Mrs. Clark works at least 44 hours a week, including evening shifts and frequent Saturdays and Sundays. She often brings paperwork home with her, spends her days off scouting the competition, and never takes more than a week off at a time. </li></ul>
  4. 4. Case Context <ul><li>While Americans often marvel at German industriousness, a comparison of actual workloads explodes such national stereotypes. In manufacturing, for instance, the weekly U.S. average is 37.7 hours and rising; in Germany it is 30 hours and has fallen steadily over recent decades. </li></ul><ul><li>All German workers are guaranteed by law a minimum of five weeks’ annual holiday. The German department store workers also fiercely resist any incursions on their leisure hours, while many J.C. Penney employees work second jobs and rack up 60 hours a week. </li></ul>
  5. 5. Problem Definition <ul><li>Given with the differences in work schedules of Karstadt and J.C. Penney, the following concerns emerge: </li></ul><ul><ul><li>How does the work culture in the U.S. differ from that in Germany </li></ul></ul><ul><ul><li>What are the basic advantages and disadvantages of each system? </li></ul></ul><ul><ul><li>What should the top operations executive of an international department store chains address regarding corporate human resource policies? </li></ul></ul><ul><ul><li>Are the retailing employee issues different than other industries? </li></ul></ul><ul><ul><li>Which system, the Karstadt or J.C. Penney’s, is more strategic in terms of human resource policies? </li></ul></ul>
  6. 6. Framework for Analysis and Areas for Consideration <ul><li>Human resource strategy should ensure that labor and job designs are efficiently utilized to produce quality of work life, mutual commitment and mutual trust. </li></ul>
  7. 7. Framework for Analysis and Areas for Consideration <ul><li>Labor planning should efficiently determine staffing policies dealing with employment stability, work schedules and work rules. </li></ul><ul><li>Work schedules, most importantly, should be properly matched to the nature of a firm or any other organization. </li></ul>
  8. 8. Framework for Analysis and Areas for Consideration <ul><li>Job classifications and work rules, depending on its rigidity, may improve or weaken employees’ performance. However, a flexible workforce is needed if the objective of an organization is to gain competitive advantage. </li></ul>
  9. 9. Framework for Analysis and Areas for Consideration <ul><li>Motivation and incentive systems should be fostered in an organization using not only financial rewards but also non-financial incentives such as awards, recognitions and the likes. </li></ul>
  10. 10. Framework for Analysis and Areas for Consideration <ul><li>Methods analysis can be used to identify weak points or items for improvement in an organization, that is, in this case through an operations chart to detect wasted motion and idle time. </li></ul>
  11. 11. Analysis <ul><li>Basically, the differences between the work culture of U.S. and Germany rests at human resource policies with regard to quality of work life, work rules, work schedules and motivation. </li></ul><ul><li>In terms of quality of work life, Karstadt is more efficient in providing intangible rewards, such as quality time with the family, thru loose work schedules, whereas J.C. Penney is more efficient in giving out concrete or monetary rewards thru tight work schedules. </li></ul>
  12. 12. Analysis <ul><li>Moreover, work rules are more rigid in J.C. Penney than Karstadt which proves to be inflexible for the former given the high staff turnover of 40% a year compared to a fairly negligible staff turnover at the German store. </li></ul><ul><li>Strict work rules indeed come with a price. </li></ul>
  13. 13. Analysis <ul><li>Furthermore, J.C. Penney cultivates a work culture that is firmly grounded on monetary returns which then explains the fleeting or weak motivation among its employees. Due to short trainings, ranging from two to three days, employees of J.C. Penney become motivated to work because of monetary returns and self-centered intentions. </li></ul>
  14. 14. Analysis <ul><li>On the contrary, Karstadt provides apprenticeship of two to three years which enhances job identity, job significance and autonomy. </li></ul><ul><li>Employees of Karstadt are not merely financially motivated but quality-oriented, both in work-related aspects and personal relationships. </li></ul>
  15. 15. Analysis <ul><li>Methods analysis can be a useful tool for J.C. Penney to identify wasted motion and idle time thereby saving time for leisure and for other personal activities. </li></ul>
  16. 16. Analysis
  17. 17. Analysis
  18. 18. Decisions <ul><li>Top operations executive of an international department store chain should adopt the following human resource policies: </li></ul><ul><ul><li>Fostering quality work life through achieving physical, psychological and emotional requirements </li></ul></ul><ul><ul><li>Granting some form of autonomy to employees in relation to work schedule </li></ul></ul><ul><ul><li>Designing job classifications and work rules accompanied by respect to employees’ individual needs and differences </li></ul></ul>
  19. 19. Decisions <ul><li>Providing rigorous training to improve job identity, job significance and autonomy of employees’ contributions to an organization </li></ul><ul><li>Motivating employees financially and non-financially </li></ul><ul><li>Employing concrete assessments of employees’ efficiency in order to save time for leisure and personal activities . </li></ul>
  20. 20. Basic Justification of Decision <ul><li>Quality work life improves employees’ efficiency and adds value to an organization. </li></ul><ul><li>Employees are more interested to perform their tasks efficiently when they are given some form of autonomy in choosing their work schedules than requiring them to fix work schedules. </li></ul>
  21. 21. Basic Justification of Decision <ul><li>Job classifications and work rules should be flexible so that employees will be able to adapt freely on the changing circumstances of the workplace. </li></ul><ul><li>Improved job identity, job significance and autonomy encourage employees to work hard not just for their benefit but for the benefit of the organization and the larger society. </li></ul>
  22. 22. Basic Justification of Decision <ul><li>Employees should be equally motivated by monetary return as well as intangible incentives such as time for leisure, family and other activities not related to work. A balanced employee is a resilient and strong feature of an organization. </li></ul><ul><li>Assessment tools such as methods analysis will be useful in saving time and efficiently utilizing labor hours. </li></ul>
  23. 23. Decision Implementation <ul><li>Improving quality of work through mutual commitment and trust. </li></ul><ul><li>Conducting trainings and seminars for newly hired, old personnel and top management for occupational and individual growth as well as for strengthening cooperation amongst people within the organization. </li></ul><ul><li>Enhancing communication and information transmission among the departments. </li></ul>