Revitalization from within—a new corporate culture takes root - ShopKo Stores Inc.'s works at retaining its corporate culture - Brief Article

DSN Retailing Today, Oct, 2000

A corporate culture is a tricky thing to develop and sustain. When carefully cultivated, however, it can prove to be a powerful force in achieving financial results, and in the case of ShopKo it has does just that.

The core of ShopKo's corporate culture stems from three things: attitude, management style and focus on store operations, all of which are driven home by an enthusiastic senior leadership team.

"The mission of human resources is to make sure our people are truly our competitive advantage," said Dennis Folz, senior vp of human resources. Folz was promoted to his current position nearly 18 months ago, shortly after he joined the company in August 1998 as vp of organization and leadership. He previously served as senior vp of organizational effectiveness at Personnel Decisions Inc.

"Effective at the first of this fiscal year, we began testing all of our exempt new hires for cultural fit with our organization," Folz said. "We have a 75-minute paper and pencil test candidates take once they have been through the interview cycle."

One of the values the test seeks to assess is whether individuals are team players or prefer to work in isolation. A host of other variables are also measured, and then results are combined with interview information to determine whether an individual has the attributes ShopKo desires for its culture.

If a person has the right attitude, ShopKo wants to provide them with a positive work experience and attractive features such as "lifestyle scheduling," where people get to pick their own hours or a 26-hour week that qualifies them as full-time.

At the retailer's home office, a new process called "Arriving at ShopKo" ensures that employees get off to a good start and understand what the company is about.

"The first week employees arrive here they spend five full-time days in an orientation about our mission vision, value structure, business plan and all the tools we use," Folz said. "It's been one of the most highly received things we do to help get people a good healthy start into learning their way around the business."

The culture at ShopKo is a fairly recent creation and still a work in progress because it is being shaped through the leadership of a relatively new group of senior executives.

Of the existing 12-member executive team, roughly half have been with the company less than five years. Even chairman, president and ceo Bill Podany is a relatively recent addition, having joined ShopKo in 1994. The only two members of the executive team who didn't join the company in the '90s are Michael Bettiga, senior vp of stores and retail health operations, and Steve Harig, senior vp of planning, replenishment and analysis, distribution and transportation.

Each of the retailer's senior managers went through a skills assessment. Recruiting for other positions at the home office has also changed. The company wants to make sure people are being sought with the right skills for the right positions.

"We look at each time we turn over as an opportunity to reinvent the job," Folz said. "We don't want to duplicate the individual we just lost or the person we just promoted."

The company looks at how well the position is meeting the needs of the organization, and what should be changed about the nature of the job. The hiring manager is involved in the process to determine what is or isn't working, and what competencies are most important.

Of course, a key goal is the reduction of turnover at the home office, and this takes on additional importance at ShopKo because of the company's location in Green Bay, Wis. In much the same way as Wal-Mart has difficulty recruiting people to work at its Bentonville, Ark., home office, it can be a challenge to attract retail talent to an out-of-the-way place such as Green Bay. Consequently, the company has focused on growing its own through programs such as ShopKo University and technology training.

"We have some pretty extensive development programs," Folz said. "We will have to grow our bench as much from the inside as we will be able to improve from outside."

All the training programs, executive assessments, new programs and screening processes are ultimately intended to produce a culture where teamwork is valued, and the goal is taking care of customers.