Shift your labor strategy to attract and engage top talent

SPONSORED BY KRONOS INC.

Introductions

John FrehseManaging Partner

Terry KettererManager, Value Consulting

Why is this important?

56% skills of the current workforce do not match changes in company strategy

The struggle for top talent continues

45% when hiring for certain jobs, there are too few qualified candidates

43% lack of skilled talent in one or more of the company’s business lines

Source: Bridging the Skills Gap, Association for Talent Development, 2015

GROWING SKILLS GAP

“We have turned down or not even pursued certain projects because we do not have the qualified people to lead the projects.”

Top Executives are saying…

Manufacturing is failing to attract young skilled workers, like millennials

FUTURE OF WORK?

80% of manufacturing jobs are currentlyemployed by workers between the ages of45–65 years

Source: Skills Gap Study, Deloitte & Manufacturing Institute, 2014 | MFGDay.com

Training – I want to improveMeaningful Work – I want to make a differencePurpose – I want to feel valuedSocial Responsibility – I want to do ethical work

What they want?

And. I can do it now.

Marital Status in 2014MILLENNIALS’ PERSONAL CHOICES IMPACT CAREER GOALS

Millennial (ages 18-33)

Gen X (ages 34-49)

Boomers (ages 50-68)

Silents (ages 69-84)

Married

Separated / Divorced

Widowed

Never Married

28 4 68

19

10

41260

66

65 16

19

1

5

25% of 18 to 34 year-olds

living arrangement

32%living in

parent(s)’ home

Source: Pew Research Survey, Feb. 14-23, 2014

Millennials feel no need to rush into a jobMILLENNIALS UPBEAT ABOUT THEIR FINANCIAL FUTURE

So, how do you recruit and attract them?

Millennial

Gen X

Boomer

Silent

Earn/have enough now

Don’t earn/have enough now, will in future

Don’t earn/have enough now, won’t in future

Source: Pew Research Survey, Feb. 14-23, 2014

32 53 14

30

38

40254

45

38 30

15

Focus on what matters most

A Harvard Business Review study

found that organizations with

highly engaged employees

experience 22% greater productivity

Source: Harvard Business Review Study, July 2013

32.9%

40.4%

11.4%

5.0%6.8%

3.6%

40.3%

33.5%

11.2%

5.8%4.1% 5.1%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Very satisfied Moderatelysatisfied

Slightlysatisfied

Slightlydissatisfied

Moderatelydissatisfied

Verydissatisfied

Perc

enta

ge o

f Res

pond

ents

Client Normative Database

Job satisfactionIT’S NOT ALWAYS ABOUT THE MONEY

Trust and integrity

Visibility

Nature of the job

Career growth opportunities

Pride in company

Team members

Manager relationship

Source: Core Practice

63.4%55.8%

54.7% 54.4%

78.4%

58.6%52.4%

46.7% 45.6% 47.4%52.1%

60.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Enough time off Quality time off Fits in with yourfamily/social life

Flexible schedule Predictableschedule

Effective training

Perc

enta

ge o

f Res

pond

ents

Client Normative Database

How employees feel about work/life balance

Source: Core Practice

Employee engagement is more and more about visibility, flexibility, and a sense of control

Shift your labor strategy

This is supposed to get them excited?

Work Days 260Days Off 104Weekends Off (Full) 52Longest Break 2 days (52x)Max. Number of Shifts in a Row 5

120-40, Balanced, 1 X 3 Crew, 8-Hour, Fixed, Fixed, Every Weekend Off

Crew/Week Mon Tue Wed Thu Fri Sat Sun Totals

1 8 8 8 8 8 - - 40Avg. 40

What if you tried this?

Work Days 173Days Off 191Weekends Off (Full) 52Longest Break 6 days (17x)Max. Number of Shifts in a Row 3

120-40, Balanced, 3 X 2-Crew, 12-Hour, Fixed, Rotating, Long Weekend

Crew/Week Mon Tue Wed Thu Fri Sat Sun Totals

1 12 12 12 - - - - 362 - - 12 12 12 - - 363 12 12 - 12 12 - - 48

Avg. 40

8 hour shifts - 7 day coverage - awful!

168-42, Balanced, 4 X 3-Crew, 8-Hour, Fixed, Rotating Model

Work Days 273Days Off 91Weekends Off (Full) 13Longest Break 3 days (13x)Max. Number of Shifts in a Row 7

Crew/Week Mon Tue Wed Thu Fri Sat Sun Totals

1 - 8 8 8 8 8 8 482 8 - - 8 8 8 8 403 8 8 8 - - 8 8 404 8 8 8 8 8 - - 40

Avg. 42

7 day coverage with 12 hour shifts – an improvement?

Work Days 182Days Off 182Weekends Off (Full) 26Longest Break 3 days (26x)Max. Number of Shifts in a Row 3

168-42, Balanced, 2 X 2 Crew, 12-Hour, Fixed, Rotating, Every Other Weekend Off

Crew/Week Sun Mon Tue Wed Thu Fri Sat Totals

1 - 12 12 - - 12 12 484 12 - - 12 12 - - 36

Avg. 42

168-42, Balanced, 4 X 2-Crew, 12-Hour, Fixed, Rotating SLB

Work Days 182Days Off 182Weekends Off (Full) 26Longest Break 7 days (13x)Max. Number of Shifts in a Row 4

Crew/Week Mon Tue Wed Thu Fri Sat Sun Totals

1 12 12 12 12 - - - 482 - - - - 12 12 12 363 12 - - - 12 12 12 484 - 12 12 12 - - - 36

Avg. 42

7 day coverage with 12 hour shifts – night shift?

Source: Kronos Analytics product

The management team is staffing higher on Fridays in anticipation of absenteeism.

Source: Kronos Analytics product

Time off on Friday is on par or lower than other days. The plant is not experiencing a typical bathtub curve evident in many facilities.

• Serious idle time problem • Isolated Friday overstaffing

issues - costing $1,100,000 annually in idle time costs

• Employee morale on Fridays is down because employees have less chance to feel valued and achieve goals

• Kronos Core Practice Plug-In gave management visibility into labor statistics in a timely manner to make more informed decisions

• Reduced Friday overstaffing• Gave employees the right

ratio of work to employee allocated hours

• Although some idle time remained due to variable demand, the management team was able to reduce idle time by $924,000 annually

• An 84% reduction • Employees noted, “The days

went by faster”

SEE IT IN ACTIONShifting Your Labor Strategies

Diagnosis Solution Results

WORKFORCE MANAGEMENT DRIVES ENGAGEMENT

More control over work / life issues

Automation

Employee self-service

Shift bidding

Union compliance

Equitable schedules

Increase in year-over-year workforce capacity utilization by businesses

with leading scheduling capabilities 30%

Source: Aberdeen Group, Workforce Optimizations, Managing the Quality, Cost and Speed Paradox

Workforce Management gets you there

ENGAGE YOUR ENTIRE WORKFORCE

Too often, hourly workers are not engaged. And, for most, they are the bulk of your workforce.

is 37% worse for organizations with disengaged workers compared to engaged

And, employee engagement impacts more than you might think

ABSENTEESIM

[SAFETY INCIDENTS]are 48%

HIGHER

Brian S. Lassiter, Workers Are Mad As Hell: 14 Ways to Increase Employee Engagement, Performance Excellence Network (June 25, 2013), found at http://www.performanceexcellencenetwork.org/pensights/workers-are-mad-as-hell-14-ways-toincrease-employee-engagement/.

Think about how employee engagement can impact OEE

Source: Harvard Business Review Study, July 2013Source: www.oee.com

MOST EQUIPMENT IS UNDERUTILIZED

Typical Manufacturer OEE = 60%

World Class ManufacturerOEE = 85%

more productive Organizations with engaged employees are

REMEMBER

22%

Setup & AdjustmentsBreakdowns

Reduced SpeedSmall Stops

Production RejectsStartup Rejects

most common causes of equipment-based productivity loss

Impacted by engagementtypically the result of human interaction

Employee engagement is a

financial strategy for the future

$$

SKILLED TALENT

VISIBILITY

FLEXIBLE SHIFTS

LOYALTY MILLENNIALS

GROWTH

PRODUCTION

INNOVATION

Questions?

John FrehseManaging Partner

Terry KettererManager, Value Consulting