Never knowingly undervalued
There are no more jobs for life, or so we are told. But one highly profitable retail group still offers its trainees a degree of security. Nigel Cope reports
Thursday 15 June 1995
IBM, for example, stopped promising guaranteed jobs to its graduate trainees in 1990. It now offers them four-year "fixed term contracts", which means that trainees must apply for a full-time job after their training is completed. If there are none, they are turfed out. Even Japanese companies are moving away from the "jobs for life" guarantee while Marks & Spencer, well-known for looking after its staff, postponed its graduate intake for one year during the recession. The modern argument is that everyone must take more responsibility for developing their own careers. Simply signing up for a large corporation and expecting them do it for you is no longer enough.
All this makes John Lewis Partnership, the department store and Waitrose supermarket group, something of a haven in a heartless corporate world. A position at John Lewis is about as close to a job-for-life guarantee as a graduate can get these days.
John Lewis recruits 25-30 graduates each year for the department stores business and around 10 for Waitrose. Starting pay ranges from pounds 14,000- pounds 17,000, depending on location. Each trainee is put through a two-year course which involves being moved around various departments before ending the programme as department head. They are told at the beginning that they will be guaranteed a job at the end of the scheme. The jobs are not handed to them, however. Graduates have to apply internally against other candidates both from the training scheme and from elsewhere in the company. But at least they will not be out of a job.
Monique Gemke, of John Lewis recruitment division, says: "We invest an enormous amount of time and money in our graduates. The last thing we want to do is lose them just when they start to pay off and become productive. They finally get a chance to prove themselves." She says that the company expects trainees to rise to the highest echelons. Several are now directors.
Caroline Highcock joined the graduate training scheme in 1985 at Peter Jones, the group's department store in London. Last year she was promoted to central buyer for lampshades and lamp bases. She says the greater security offered by a partnership rather than a large corporation with profit-hungry institutional shareholders was not a factor in her joining. "Being a partnership does not mean that John Lewis is a soft and safe option. As a central buyer my own performance figures are published every week in the staff magazine, so 35,000 of my co-owning partners can see how I'm doing. That really concentrates the mind."
Susan Bloch, a consultant with personnel consultants GHN, says there are pros and cons to the John Lewis system: "They might feel they get more loyalty and commitment to the company from their staff as a result of their approach. But they might lose out on staff gaining greater breadth of experience by working elsewhere. Sending managers on secondments to other companies might be a good move."
John Lewis is one of the most highly regarded retailers in Britain. In March it announced a 25 per cent increase in profits to pounds 116m on sales that topped pounds 2.5bn. The staff - or partners, as John Lewis describes them - received a bonus of 12 per cent of their annual pay, which proves you don't have to be mean to be lean and profitable.
The roots of John Lewis's commitment to graduates go back to the partnership's origins in 1929 when John Spendan Lewis, the first chairman, recruited from universities in a fast-track programme. The present chairman, Stuart Hampson, recently restated the group's commitment to the partnership philosophy: "Today, 34,000 partners participate in the task of manging our business to serve our customers better, and they share in the profits of our success ... We believe this gives us commercial advantage and distinctiveness in a highly competitive sector."
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