Abstract

Henry Tam, the logistic director at 7-Eleven’s Combined Distribution Centre (CDC), is considering how to tackle a high employee turnover rate. This challenge is partially the result of a shortage of labor in Hong Kong. Over the years, Henry has taken several steps to address the issue. These include collaborating with non-governmental organizations (NGOs) to train and employ disabled workers; adjusting the use of cold storage for perishable goods; how to handle bakery products; how bulk goods are packed and distributed; and adopting new technologies to improve employee productivity. Moreover, Henry offers the staff three hours of overtime per day, allowing them to earn more. Henry doesn’t know what else he can do to decrease the high turnover and retain his employees.

Learning Objectives

This case covers:

• an illustration of the management of employee turnover at a centralized distribution center.
• the importance of capacity management
• the different sources of supply uncertainty as well as the strategy to tackle these uncertainties.
• the importance of human resource management in a labor-intensive operational context.
• the challenges of retaining and incentivizing employees in the context of emerging market economies.