Diversity Solutions at Pennymart Ltd.
Diversity Solutions at Pennymart Ltd Instructions This is a 3000 word assignment. It should be written in business report format. You should follow the assessment guidelines at the end of the case study: This assignment represents 50% of your total grade for this module. Pennymart Ltd Pennymart is a chain of 30 low budget stores in North America, largely specialising in domestic goods such as light bulbs, stationery, small tools etc. In recent years they have added a low cost toiletries range that has been very successful. Their motto is œAnything priced above $10 we won’t sell it. The company has been trading since 1984. It has had quite a turbulent management history since the founder sold his controlling shares in 1998. The CEO has changed 4 times since then. The current CEO, Julia Perch, has been in post since 2002. In the last three years, she has built a thriving company with an annual turnover of $1 billion. Coming from an HR background, Julia is extremely interested in people management, creating ˜innovation through diversity and the importance of training and development for staff to increase Pennymart’s competitive advantage. The Situation: Since julia’s arrival, this large company was considered an early diversity leader, with its strong work/life benefits, high rates of hiring and promoting women, and frequent public communications about having an inclusive corporate culture. julia appointed a Chief Diversity Officer (COO), Kim Merchant, about that time. Kim joined many diversity-related organizations and was a visible face of corporate diversity in the mainstream press. Although the CEO was not making personal statements about her commitment to diversity, she was holding senior leaders accountable for results and meeting with regional, departmental and store managers. Pennymart created regional, open œdiversity forums, were staff could nominate œdiversity champions who could attend and represent the varying employee views on such matters. Representation in the workforce and lower management was racially diverse, especially compared with the industry averages, but there remained a gap at the top levels of management. What Happened? Following the recession, Pennymart has found that its representation of all groups, including women, has declined relative to the other companies in the retail industry. The main reason for the decline: Changes to the company structure meant that the CEO has had much less oversight of the management of operations and has been focussing on strengthening the company’s position nationally, with a view to growth into global markets. This company, like many others, was hit hard by the economic turbulence in the last three years. The chief diversity officer, who did not speak of diversity in business terms, could not maintain diversity as a business imperative. The company has even removed the diversity section from its homepage. In addition, the CDO did not track participation in diversity forums or have metrics for monitoring diversity within their supplier companies. There was no way to assess what was workinq and what was not-and what ramifications it NaS having on the bottom line. The chief diversity officer did not have frequent access to the CEO or to her direct reports, reporting in two levels down to the head of HR. The CDO was viewed strictly as a staff person whose business advice was not considered. The Results: As other companies innovated and added diversity-management practices, Pennymart actually dropped best practices. The diversity forums were disbanded due to cost to the resource costs of allowing employees to attend. The CEO no longer signed off on supplier-diversity goals. Alternative career tracks for employees with long-term family concerns weren’t offered. Management participation in formal, cross-cultural mentoring declined dramatically. Those results were reflected in the company’s representation numbers, which showed an even more dramatic decline in racial and gender diversity at the top ranks as well as sharp gaps in retention when examined by race/ethnicity. While the company was downsizing, Black and minority ethnic employees were leaving at a rate triple that of their white counterparts. TASK You are a Human Resource Consultant, specialising in the area of organisational development and diversity. The CEO, Julia Perch, has requested that you carry out a diagnostic analysis of diversity issues at Pennymart and produce a full report with suggested solutions to get Pennymart back on track. Julia is keen to be at the cutting edge of diversity practice and therefore has requested that you include œup-to-date theoretical research to support your diagnosis and recommendations.