HomeLifeHomeLifeHomeLife The name HomeLifeHomeLifeHomeLife is a relatively young company that competes in the consumer electronics and appliances industry (televisions, computers, kitchen appliances, etc.). The company describes itself as \"making your life more enjoyable by making your home more efficient at an affordable price, regardless of how you define efficient.\" The company sells a large selection of items, and the range of the products that it carries spans the price spectrum from very low cost to very high end. For example, some of the company\'s kitchen ovens cost just under $400, while others cost well over $4,000. HomeLife also has low-end, affordable televisions under $400, as well as very pricey, large plasma televisions that cost over $6,000. It strives to be a low-cost leader for the quality of the product. Compared to its competition, offers a very competitive price, if not the lowest. In addition to the cost focus, the company prides itself on providing exceptional one on one customer service. The name of the company, , is intended to reflect both the strategy and the philosophy of the organization. With a focus on costs and customer service, the name reflects the company\'s concern with the financial burdens customers face, as well as the vast amounts of information that customers must process when making purchasing decisions. Also refers to the company\'s philosophy for managing its customer service representatives: cares about its employees\' long-term well-being and success, and offers them a very attractive benefits package including generous leave time, which encourages employees to balance work and family. Customer service representatives who work at typically are hired through personal referrals of current employees, or occasionally an advertisement will be placed on the company website or another online job posting site when more than one opening exists. Each month, customer service representatives receive product training to explore the new products they will be selling to ensure that they are knowledgeable and can respond to customer questions. To motivate them to sell, customer service representatives are rewarded on a commission-based pay plan. What is interesting about this particular incentive plan is that the customer service representatives have some discretion regarding the final price of the company\'s products. Most products have a standard markup of 10% to 25%, and the employee gets a portion of this profit. While many of the products sell for the list price, sophisticated buyers and repeat customers are often able to negotiate lower prices for their products. The challenge with this plan is that the company has a reputation for low costs, and customer service representatives who are not willing to negotiate the sales price are viewed as going against this objective. By lowering the prices, however, they are cutting into their own take-home pay. Additionally, while other employees at HomeLife provide valuable support to the customer service representatives, there is no incentive plan in place for them. However, turnover for these other employees is much lower, at 25%. The company has done fairly well and now has six stores on the West Coast between San Francisco and Los Angeles. With a focus on low costs and customer service, the company has been able to sustain reasonable growthit just opened two new storesand a modest level of customer satisfaction among its consumers. At the same time, however, while the customer service representatives seem to be fairly happy and work hard, their turnover is around 70% per year. This turnover obviously involves costs associated with constantly hiring new employees, and it also has a negative impact on customer loyalty and the level of experience of the customer service representatives. As the company has grown, Maria Gonzalez, president of HomeLife, has realized that she doesn\'t have the time or expertise to attend to all the issues related to policies for managing people. Recognizing that it is time for the company to have a full-time director of HR, Maria has decided to hire Daniel Hillman. Daniel has 10 years of HR experience at one of HomeLife\'s competitors in the industry. Maria was encouraged by Daniel\'s enthusiasm for creating a fun and effective workplace. During the course of their discussions, Maria told Daniel that her main goal for him in his new job is to design an HR system that reduces the turnover among customer service representatives, encourages them to work hard toward the company\'s competitive advantage of low costs and high customer service, and adheres to HomeLife\'s principles of taking care of its employees. 1) Provide advice to Daniel regarding the nature of the HR system he should recommend for the customer service representatives at the six HomeLife stores.

2) Identify a key strategic performance driver for this organization.

3) How do the customer service representatives contribute to the strategic performance driver you identified?

4) Design an HR system to realize the strategic performance driver you identified. Be certain to explain how you would

(a) design the work environment, (b) manage employee competencies, and

(c) manage employee attitudes and behaviors.