Paying the price: events at Rent-A-Center prove that when employers don't respect HR today, they'll pay tomorrow - Cover Story - includes related article on learning from mistakes - Statistical Data Included

HR Magazine, August, 2002 by Robert J. Grossman

With average annual turnover in the industry at about 100 percent, the costs of continuously replenishing workers run about 50 percent of salary. Effective recruitment training and HR management can cut attrition and deliver big savings.

"We do hiring training seminars month IV," Payne says. "The training and HR monitoring is having a positive effect on profits. Turnover rate has dropped 16 percent with an estimated savings of $18,000 per person."

Robert J. Grossman

What Awaits the New HR Leader?

In June, Rent-A-Center hired a new VP of HR: Jennifer E. Wisdom the former head of HR at Triangle Pacifico Co. in Dallas and a current member of the Society for Human Resource Management.

What do others familiar with the rent-to-own industry think of the job facing wisdom?

"I wouldn't have wanted to work for them back in 1998, but I'd enjoy the challenge now," says Keith Carrico PHR formerly HR head at rent-to-own chain Rent One and now an industry HR consultant in St. Louis.

But he also sees a lot of work in store for the new VP. "It will take three years to build the infrastructure and turn things around completely. You can get a lot done in six months, but getting it out into the field will take three years."

New policies and procedures won't solve anything without proper training says Kent Sutherland HR director, Prestige Rental Purchase, Carrolton, Texas. The new vice president will have to develop effective programs and convince managers in the field of their value. "Rent-to-own dealers believe in management training till you say it takes two or three days they think you can do it in three hours. Computer-based training is helpful, but there is no substitute for face-to-face giving people an opportunity to interact with someone with a broader scope than they see daily in their store. Our company program runs for 11 weeks. It's time consuming and expensive, but it works."

Robert J. Grossman, a contributing editor of HR Magazine, is a lawyer and a professor of management studies at Marist College in Poughkeepsie, N.Y.