SECTION A

$[40$ MARKS$]$

Read the article below and answer ALL the questions that follow.

Strategic Human Resource Management at FreshMart

FreshMart is a food retail company which is based in the UK and employs over $200,000$ staff worldwide. The company has already successfully expanded into Europe with over $150$ operating food retail sites. The main objective for FreshMart for the period $2022-2028$ has been to competitively expand its outlets into Asia. This has provided a rich source of opportunity for the brand.

FreshMart's expansion began with a focus on Thailand and Malaysia, using existing links with locally successful retailers to gain market entry to both countries. As a result, FreshMart invested heavily in buying sites around Thailand and Malaysia which offered an opportunity to expand. The sites followed a similar format to those currently operating in the UK and offered food retail shoppers an opportunity to purchase products from small shops located on petrol forecourts to large hypermarket settings. The strategy was clear from the outset and the company's UK blueprint was used and appeared to work in partnership with existing local retailers.

The next objective for the expansion strategy was to move into China. The company saw this as a key strategic opportunity which would tap into large sales advantages and help promote its brand on a global scale. The company planned to use what it believed to be a 'secret weapon' to ensure that the customer would be attracted to the products and transfer to the brand $-$ the loyalty card. This would be used to tie customers into the 'FreshMart Way' by offering discounts through a points$-$based system which had proved hugely successful in the UK market. From the retailer's perspective, this provided an opportunity to access thousands of customer shopping habits, allowing FreshMart to tailor its products and services to the local customer base. The retailer planned to launch the loyalty card as part of the store opening strategy.

FreshMart began to open its new stores and poured vast amounts of financial resources into the expansion in China. This included launching an international assignment programme for all store managers based in the UK$.$ The people strategy that the company adopted saw $150$ of the 'best' store managers seconded to China to support the launch of the expansion operation. The managers had to have two main criteria to apply for the position $-$ over ten years working at a senior level in UK operations and a willingness to relocate for a minimum of three years. That said, some of the 'best' store managers were simply handpicked by the Director of Retail Operations without adhering to a formal recruitment process. The expatriate training programme consisted of a six$-$week initiation focusing on supporting the company's objectives in China: these were simply to launch the store and follow the people strategy using the 'FreshMart Way' underpinned in the UK$.$

With the senior managers on board and stores preparing to open in China, a twenty$-$week pre$-$opening plan was put in place for each store. The plan included recruitment of staff, from shop floor and cashiers to team leaders and department managers. The company was insistent that UK people processes were to be followed to the letter. These included practices around performance appraisal, induction, training and development, communication and customer service skills. Only four weeks into the pre$-$opening plan, store managers began to report a torrent of issues such as difficulty in interviewing for the posts as parents were attempting to sit in on the interviews with their children $($some of whom were over $30$ years old$).$ Other problems included concerns with communication, as in the UK the process encouraged members of staff to participate in a two$-$way share of ideas and issues for the day. In China, individuals felt intimidated and would rather be given opinions and work as collective groups. Other concerns from the management team suggested that many university students were not interested in working in food retail as it was seen negatively by their families, so large gaps were appearing in the proposed staffing schedules.

The FreshMart headquarters insisted on persevering with these issues as they were merely seen as 'teething' problems, and the people strategy worked well in the UK so why wouldn't it work well here? The management team was encouraged to recruit local staff yet there wasn't any priority to recruit locals with management experience or capability. The UK managers were exceptional performers within the context of the UK retail food sector, moreover the 'FreshMart Way', yet out of the $150$ store managers seconded only three had ever been to China. The company had anticipated that the 'rollout' to China could be facilitated through the seconded managers and directed from the parent HQ in the UK$.$

The stores opened with huge deficits in their staffing schedules. Human resource managers reported wo