How Asda sharpened its grooming
Thursday 13 April 1995
Graduates often face a long delay between applying for posts with large companies and actually having something worthwhile to do. There are the forms to be filled in, the presentations and drinks parties to be attended and the interviews to be sat through - even before they are selected. Then, there are typically induction courses and the like before they get down to any real work.
In keeping with its cost-cutting image and enthusiasm for discarding the old ways of doing things, the store group Asda is abandoning this approach. Its new programme currently under way for the first year is designed to give graduate recruits responsibility as soon as possible. After three months of intensive training they will be assigned to sales or trading floors, where they will be encouraged to develop commercial and people skills, implement their ideas and question and challenge existing procedures.
According to Philip Horn, management development adviser at the company, the abandonment of the old eight-month training course is as much motivated by the desire to meet recruits' needs as to cut costs. "We find they are chomping at the bit and they are ready to go," he said.
Anxious to draw distinctions between Asda and its retail rivals, he also points out that where they go is geographically limited. While others seem to make a virtue of sending young graduates up and down the country at short notice, the Leeds-based group believes that is unsettling as well as expensive. It prefers to develop newcomers within regions, where there are plenty of different-sized stores to provide the necessary range of training. Moreover, Asda's commitment to a flat structure means there are plenty of opportunities within given areas and no need to wait to fill "dead men's shoes". Indeed, so confident is the company of finding roles for all of them that it has increased its graduate intake from 25- 30 to 100.
And there is no shortage of youthful role models for the ambitious. Chief executive Archie Norman is still in his forties, while one of the company's rising executives is Steven Cain, who has followed his boss from Kingfisher to the supermarkets group and into the Business Age "40 under 40" table of youthful managers.
Just 30, Mr Cain has been edible grocery director (responsible for the £800m-worth of non-fresh food the company buys every year) for the past year. Before that he helped to develop the company's own label operation.
"The good thing about Asda is there are lots of opportunities for career development because of the way it is structured," he says. However, he points out that most of the opportunities require crossing divisions. The "onwards and upwards" approach is limited by the lack of a hierarchy to climb. The advantage, though, is that it is relatively easy to pick up experience of different parts of the business.
Mr Horn thinks this modern approach - embodied by the open-plan premises where not even the chief executive has his own office, the absence of directors' car parking spaces and other formalities - is appealing to graduates.
There are a few US-style gimmicks, such as wearing the casual clothing George Davies makes for sale in the company's shops on Fridays and donning baseball caps when you want peace and quiet. But he claims that such initiatives are helping Asda to gain on its rivals. With total annual turnover in excess of £5bn, like-for-like sales are growing at 9 to 11 per cent, considerably higher than those of other companies.
It is, at least in part, a recogntion of how hard staff of all levels are working to achieve such results that the company has launched its other initiative in the graduate recruitment market. It is staying out of the "milk round" and instead using a headhunter to identify the students who are most likely to be of interest.
Those selected for this stage do not have to endure a week of interviews and the like when they should be studying for finals. Instead, the process is reduced to two days, much of it spent with existing employees, to assess people and communication skills. It is receiving positive feedback, says Mr Horn.
Certainly, retailers needed to do something to balance the appeal of the banks and other commercial organisations. "A lot of people see retailing as Curly Watts," says Mr Horn. But it is much more.
In the early stages graduates could be running a multi-million pound business. Mr Cain, like Mr Norman, a former management consultant, has responsibility for 3,000 products and 300 suppliers and contributes a signficant amount of profit to the group. But star as he is, he is not considered an oddity. The company is anxious to groom more like him.
"There's no reason why, if they are the right people, they can't be store managers within three to six years. That's like being a managing director of a small to medium-sized companies," says Mr Cain.
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