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Anita's Apparel

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Anita’s Apparel Case Study
Nordstrom developed a number of systems that was designed to support “The Nordstrom Way”. I will evaluate the company’s compensation programs, customer service satisfaction and employee empowerment systems. I will then provide suggestions for Anita Lamont about compensating her employees. Nordstrom’s compensation management system contributes to the overall success of the organization in several ways. Nordstrom’s philosophy is to offer the customers the best service, selection, quality and value. They enforce that all employees regardless of the level is the customer service department. Nordstrom has an inverted pyramid of which they put their customers at the top of the chart followed by salespeople and so on and so forth. The company promotes from within and every person starts as a salesperson.
Nordstrom’s compensation system for their salespersons’ salaries are commissioned based, reflecting a commitment to pay people for their performance. Commission based salaries allow salespeople to earn considerably more money than the industry average. Salespeople also receive bonuses and rewards for doing an especially outstanding job. In order to retain their competitive advantage of superior customer service in the highly competitive retailing market, they designed an evaluation/compensation system that had the following objectives: (1) to support its high-service strategy and (2 to motivate its sales employees. They tried to evaluate and compensate based on sales performance measured by SPH (Sales Per Hour) ratio, to motivate their employees to put efforts into providing better customer service/satisfaction and increase customer loyalty. Commissioned based sales motivate employees to go the extra mile for the company which is reflected in the increased sales.
Nordstrom’s gave their salesperson’s empowerment to make decisions

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