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Organisational change

When Pick n Pay celebrated its 25th anniversary in 1992, Raymond Ackerman emphasised the importance of “People Power” in the Company's culture.

The first in a series of organisational changes started in 1993 with the resignation of Managing Director, Hugh Herman, who left the company to pursue his own interests.

Herman had in 1984 been appointed as joint Managing Director of the Company, along with Raymond Ackerman. Following his resignation, Rene de Wet and Gareth Ackerman were appointed joint Managing Directors of Pick n Pay, and Sean Summers took up the position of Deputy Managing Director.

Against a backdrop of post-election euphoria and a new government, a strike June 1994 marked a turning point for the Group. This was to be the worst strike in the history of Pick n Pay. In retrospect, the crisis proved to be the catalyst for a major change in attitude of both parties, and it lead to an agreement being struck with SACCAWU (SA Commercial, Catering and Allied Workers Union).

A careful assessment revealed that a fundamental challenge facing the Company was the issue of human relationships. It was identified that the key to improved relations was the pursuit of service excellence – in order to accomplish strong relationships, every single employee had to commit to achieving the same standards of service across all levels.

And so the seed for Pick n Pay's Vuselela programme was sown in 1996. With the beginning of a new Millennium in sight, Pick n Pay needed to rethink its structure to ensure it was in a position to lead the retail industry into the next century.

During that year Pick n Pay embarked upon the so-called “Pick n Pay 2000” process with the formation of two separate divisions, Retail and Group Enterprises, under the leadership of Sean Summers and Gareth Ackerman respectively (read more about the divisions.) Rene de Wet was appointed as Deputy Chairman to assist Raymond Ackerman with the implementation of the new structure as well as the King Report of Corporate Governance.

Raymond Ackerman described the highlights of the decade: “One of the most momentous events in the history of the Company to date is our venture into franchising, with the opening of six Pick n Pay Family stores in 1994. These stores have allowed us to extend our reach to smaller convenience locations with longer trading hours.

“The acquisition of a majority stake in Score outlets has proved a key element in the Company's strategy to provide a retail service to the emerging market consumer in both urban and rural areas.”

Subsequently, over the last two years, 52 S core stores have been converted to Pick n Pay-branded stores, an initiative that was driven by very clear customer insight. Through extensive research in the LSM4-7 target markets it was discovered that customers really wanted the Pick n Pay experience and not the Score brand, which they saw as a “second-rate” offering. Add to this that Score stores were underperforming, and the obvious solution was to convert the Score stores most suitable into Pick n Pay Franchise stores and at the same time, effect considerable transformation which has allowed the transfer of over a billion rands worth of assets to new black entrepreneurs who are franchise owners.

While the conversion process has not been without its challenges, the overall process has been an incredible success – especially if you consider that until recently we were in the grips of the harshest recession the country has seen for years – and the footprint of stores will continue to grow into the future.

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