People’s Home Gadgets (PHG) depends largely on its low prices to attract customers. However, with an employee turnover of 70%, the company is failing in employee motivation and retention. An employee who sells below the markup range has to compensate with his/her salary. Paula has to implement a funny and interactive working environment. Rather than using low prices to retain customers, the company can train the employees for higher convincing capacity (Jones & Martain, 2013). Paula should implement a participatory HR system where employees participate in decision-making.  Employees, in this case, will have a sense of uniqueness rather than competition.

A strategic performance driver is an activity that can enable a company to identify its source of competitive advantage. Such drivers include efficiency, high productivity, and low costs (Jones & Martain, 2013). For PGH, the key strategic performance is operational efficiency. The company provides one on one customer service and is very efficient. The company has maintained consistent growth through low costs and customer service. Given other competitors have lower prices; customer satisfaction is the competitive advantage of the company.

The customer sales representatives earn commissions on their sales. The CSRs thus work hard to serve as many customers as possible to earn more. This serves the interest of the customers who do not want to spend a lot of time just purchasing an electronic device. With the experience they gain, the CSRs can serve customers better, and this is the reason why Paula should work to reduce the employee turnover.

The new HR system should focus on increasing sales and reduce employees’ turnover. With operational efficiency being the strategic driver, Paula should design a more interactive environment. There should be a tracking system to track customer preferences and tastes. This will save time when the customer revisits the store (Jones & Martain, 2013). This will increase efficiency. Regular training will improve employee competencies. In addition, regular interaction sessions where employees can share their experiences can go a long way in improving the employees’ competency. Sharing experiences will enable the employees to improve on their behaviors and attitude towards their job. In addition, PGH can introduce classes for personality development to guide employees on how to behave and interact with not only the customers but also fellow employees.

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