Case Study 6
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casestudy6example2.docxRETENTION-DECIDING TO ACT 1
Retention- Deciding to Act
Background Information
Wally's wonder wash (www) is a full-service, high-tech, high-touch car wash company owned solely by Wally Wheelspoke. Located in a Midwestern city of 200,000 people (with another 100,000 in suburbs and more rural towns throughout the county), WWW currently has four facilities within the city. Wally plans to add four more facilities within the city in the next two years, and later on Wally plans to begin placing facilities in suburban locations and rural towns. Wally’s critical strategy is to provide the very best to customers who want and relish extremely clean and "spiffy" vehicles and to have customers feel a positive experience each time they come to WWW. To do this, WWW seeks to provide high-quality car washes and car detailing and to generate considerable repeat business through competitive prices combined with attention to customers. To make itself accessible to customers, www is open seven days a week, 8:00 a.m. to 8:00 p.m. peak periods, volume wise, are after 1:00 on weekdays and from 10:00 to 5:00 on weekends. In addition, Wally uses his workforce to drive his strategy. Though untrained in Human Resources, Wally knows that, he must recruit and retain a stable, high-quality workforce if his current businesses, let alone Wally’s ambitious expansion plan, are to succeed. WWW has a strong preference for full-time employees, who work either 7:30 to 4:00 or 11:00 to 8:00. Part-timers are used occasionally to help fill in during peak demand times and during the summer when full-timers are on vacation. There are two major jobs at the company: attendant (washer) and custom service specialist (detailer). Practicing promotion from within, the company promotes all specialists from the attendant ranks. There are currently 70 attendants and 20 custom service specialists at www. In addition, each facility has a manager. Wally has filled the manager's job by promotion from within (from either the attendant or custom service specialist ranks), but Wally is unsure if he will be able to continue doing this as the company expands.
Attendants start at a base pay of $8.00/hour, with automatic $.50 raises at six months and one year. They receive a brief training from the manager before starting work. Custom service specialists start at $9.00/hour, with $.50 raises after six months and one year. Neither attendants nor custom service specialists receive performance reviews. Managers receive a salary of $27,000, plus an annual "merit" raise based on a very casual performance review conducted by Wally (whenever he gets around to it). All attendants share equally in a customer tip pool; custom service specialists receive individual tips. the benefits package is composed of (1) major medical health insurance with a 20% employee co-pay on the premium, (2) paid holidays for Christmas, Easter, July 4, and Martin Luther king, Jr.'s birth- day, and (3) a generous paid sick pay plan of two days per month (in recognition of high illness rates due to extreme working conditions). In terms of turnover, Wally has spotty and general data only. Www experienced an overall turnover rate the past year of 65% for attendants and 20% for custom service specialists; no managers left. Though lacking data farther back, Wally thinks the turnover rate for attendants has been increasing. Managers constantly complain to Wally about the high level of turnover among attendants and the problems it creates, especially in fulfilling the strong customer-service orientation for WWW. Although the managers have not conducted exit interviews, the major complaints heard from attendants are (1) pay is not competitive relative to the other full-service car washes or many other entry-level jobs in the area, (2) training is hit-or-miss at best, (3) promotion opportunities are limited, (4) managers provide no feedback or coaching, and (5) customer complaints and mistreatment of attendants by customers are on the rise.
DISCUSSION
1. Do we think turnover is a problem?
It is without a doubt that turnover is a problem. This was made clear by management with complaints to Wally. Attendants are the employees who make up the company; therefore if the turnover rate is more that 50% (which in the past year was 65%) there is definitely an issue at WWW. If the company plans on future expansion this issue needs to be addresses as soon as possible to prevent the existing problem from carrying over to other/future location.
2. How might we attack the problem?
The main complaint is job satisfaction therefore; WWW needs to increase job satisfaction. The company should concentrate on the areas in which attendants seem to complain most about; they are, pay, job training opportunities for advancement, coaching, feedback, customer complaints and customer abuse. WWW can work with current and its best employees in developing knowledge, skill, ability and others test that can be used to hire future employees. Another great way to attack employee motivation and morale is rather than providing a raise at the 6 and 12 month mark at only .50 cents and is evaluated by Wally himself; Wally should consider giving employees raises or bonuses based on performance. Performance evaluation should be done by the managers whom actually work with the employees rather than Wally who “comes around when he comes around”. Another incentive would be to provide benefits packages based on time spent/loyalty which equals to time in the company. A new employee should not receive the same benefits as an employee who has been in the company for ten years. A great example is the federal system, where for the first five years employees accumulate 4 hours of sick time per pay period and the hours increase based on your years of service in the government. According to OPM, 2014; “Members of the Senior Executive Service (SES), employees in senior level (SL) and scientific or professional (ST) positions accrue annual leave at the rate of 1 day (8 hours) for each full biweekly pay period” (Office of personell management, 2014).
Another way of attacking the issue is to ensure that employee’s physical environment is motivating.
According to a survey by the American Society of Interior Designers, “employees cited their physical environment to be one of the most important factors influencing their decisions to accept or leave jobs, tying for second with benefits.” Forty-one percent of respondents said that the physical workplace would impact their decision to accept a job, and fifty-one percent said that it would impact their decision to leave one (Jao, 2014).
It is suggested that the company analyze it long term and short term goals for its employees. What is the company’s vision long term? Since WWW made it clear that the company wishes to expand, it is important that the company address the major issues that will affect those goals; such as employee turnover and customer service. Whatever solution WWW arrive to, to combat its main issues needs to be integrated into an action plan. WWW managers along with its HR department should work closely to ensure that it retains it most skilled employees by implementing strategies resulted from analyzing short and long term goals.
Once WWW performs steps 1-3 indicated above then and only then should WWW be able to proceed, otherwise it won’t be wise proceeding to expansion, it will be a matter of time before same issues re-surfaces. It should be agreed by both management and the human resource department that all issues have been addressed, and there is a strategy to resolve such issues now and in the future. A set time frame should be established to see some change giving WWW a chance to re-evaluate and take further action if such issues still exist and at what magnitude as before.
5. How should we evaluate the initiatives?
It is suggested that WWW management team along with the human resources department come up with set of faultfinding measures of success, which track and assess on an ongoing basis by human resources and management for effectiveness of the programs implemented compared to goals set from the previous process.
In conclusion WWW should keep in mind that loyalty, respect begins at home. If employees are happy that emotion or pride will be transferred to customers. Taking care of employees will reduce complaints both from employees and customers. According to Jennifer Pollard of Microsoft Dynamics, 2012; “the most important thing you can do to win the hearts of your customers is to win the hearts of your employees first” (Pollard, 2012). Quality customer services has the power to attract new customers, retain existing customers, and shape a company’s brand; however quality customer service can only be achieved if employees themselves are happy with their terms and condition of employment and loyal to the company.
References Jao, J. (2014). Pimping The Workplace: How To Set Up Your Company's Office For Success. Forbes, 1. Office of personell management. (2014, October 07). Pay & Leave. Retrieved from OPM.gov: http://www.opm.gov/policy-data-oversight/pay-leave/leave-administration/fact-sheets/annual-leave-accrual-rates-for-senior-executive-service-senior-level-and-scientific-or-professional-positions-or-equivalent-pay-systems/ Pollard, J. (2012). Turning Customer Care Inside Out. Forbes, 1.
