
The marketplace for the current retail industry is competitive and challenging. It also provides us with the opportunity to analyze the realities that businesses face in order to stay alive. MEC, formerly known as Mountain Equipment Co-op, is a case in point.
MEC is a Canadian outdoor equipment and clothing sales retailer with a targeted consumer base. Customers are members who can purchase a lifetime membership card to buy high-end adventuring products. If we were to apply one of the corporate strategies from our HR planning studies, MEC would most likely fit into the ‘differentiation strategy’ category. Established in 1971, MEC continued to persevere successfully until 2019, when it faced multimillion dollar losses as reported by the CBC.
As noted in the CBC article, MEC faced numerous environmental challenges. Again, if we were to apply our HR planning studies to this case, we would see that an environmental scan of the strategic business challenges facing MEC include both internal (organizational and staffing structures) and external (online and big-box store competition) impacts.
In January 2020, MEC announced the implementation of significant staffing and structural changes in response to the aforementioned financial and retail losses. As noted in this article, which summarizes their proactive strategic business initiatives, MEC appears to be implementing a ‘turnaround strategy’ in order to increase its organizational viability.
Part of this new business plan includes the need to convert a number of existing part-time or casual roles to full-time, permanent employment positions. This step provides an example of the need for HR forecasting, which must take into account the current HR supply measured against the future HR demand for human capital. With the implementation of this kind of staffing strategy, both the number of employees, and the corporate knowledge that these employees bring to their roles, should be retained, and will increase profitability and much-needed viability.
In order to survive, any business strategy that is focused on the need for change comes with the expectation of success in implementation, along with an escalated level of risk. It remains yet to be seen how these changes will all play out in this real-time application of human resources and business strategic planning for MEC.
Discussion Questions:
- What other types of business strategies could MEC use in order to remain viable in the current marketplace?
- What type of staffing strategies is MEC using to bolster employee support and confidence?
- What are ongoing environmental risks that MEC must consider in order to remain viable?
- If you were to apply a SWOT analysis to MEC’s new strategic directions, what would be the results?