A focus on talent in 2017
This last year in Australian retail has been one of just as many highs as there have been lows. Ending this year on a positive note, we can look back and see remarkable change and transformation among many retailers that have focused on ways to challenge the status quo in-store, online and through their people strategies.
For some retailers, success will continue in 2017 but by all accounts, trading conditions are expected to remain relatively flat. Faced with this outlook, the approach most businesses will take when looking at mediocre sales growth of three to four per cent is to keep their payroll lean, and their hiring activity low. But is this the best approach and could the alternative – an injection of talent – be what’s required to lead to growth in an ever-changing and challenging retail environment?
Setting your hiring intentions
Unsurprisingly, market conditions have always had an impact on hiring intentions. There will, of course, be unforeseen events, but there are two key changes set to shake up the marketplace for talent in 2017-18 that should be on the radar of every Australian retailer: the much talked about arrival of Amazon and the impending head office move of David Jones from its iconic home in the centre of Sydney across the border to Melbourne.
Knowing what’s ahead and the impact that this will have on the availability of talent in the market, the key question for all retailers is: Can we afford to play it safe or do we instead take a punt and challenge the status quo?
Play it safe
With budgets set and teams in place for 2017-18, maintaining the status quo will seem like the most natural and obvious response to current market conditions for the majority of Australian retailers.
The approach makes complete sense on paper – in times of sales growth, seek new talent and when sales are flat, reduce hiring activity. And if immediate cost savings need to be made, payroll tends to be the first place we look.
But does this approach take a holistic view of what’s happening in the marketplace for talent? Will we see a repeat of what has affectionately become known as the Aldi-effect? That is, underestimating the impact a retailer could have on market share which, of course, has a knock-on effect on the availability of top talent. By not actively pursuing and working to retain talent, could retailers lose their best talent to the likes of Amazon and in Melbourne, to David Jones?
Take a punt
As counter-intuitive as this approach may be, an injection of talent can be just what’s required to remain relevant and promote growth in a retail environment when faced with changed market conditions – new entrants, increased consumer expectations and diversified purchase pathways.
Businesses that we see do well in times of lacklustre growth are those willing to take an educated risk and do something different. Whether through a restructure, re-invigorating the brand, or a renewed talent strategy, success comes from challenging the status quo rather than standing still.
Retailers willing to weigh up initial investments in retaining or securing new talent, with the potential return on investment, will be best placed to go head-to-head with market competition for talent and take advantage of opportunities for growth in less than favourable trading conditions.
Will taking a punt be what local brands need to do to compete with what the new kids on the block have to offer top Australian retail talent?
If we have learned anything from history, it’s that if we always do the same thing over and over again, we can’t expect different results. Is taking a punt on a new talent strategy what could make the difference between a good and a great year for Australian retail in 2017?