case
striker101
case_a_nalysis.docxCase A nalysis
You run Tricky Nicky’s Carpet Cleaning Co., which cleans carpets for businesses. On average, one carpet cleaner can clean six offices per eight-hour shift. Currently 100 cleaners work for you, and they work 250 days per year. Supervisors inspect carpets when cleaners notify them that the carpet is done. Because of Nicky’s “Satisfaction Guarantee,” when a carpet does not meet the standard, it is redone immediately at no extra cost to the client. A recent analysis of the rework required found that, on average, one in every six carpets cleaned does not meet Nicky’s standards.
The profit averages $20 a cleaning. You pay your cleaners $15 per hour. When you re-clean a carpet, you lose, on average, $20 in employee time. You still receive the same amount from the client, but, on average, your profit is gone.
Your training manager conducted a needs assessment regarding this issue at your request. He reported that half the employees are not reaching the standard one in nine times, and the other half are not meeting the standard two in nine times, for an overall average of one in six [(1/9 + 2/9)/2 = 1/6]. The needs assessment also indicated that the cause was a lack of KSAs in both cases.
The training manager proposes a training program that he estimates will reduce the re-cleaning by half, to one carpet in 12. The training would take four hours and could handle 20 employees per session.
The costs below, reflect implementing five training sessions and assume 250 working days in a year.
Developmental Costs
1.
How much does the re-cleaning cost Nicky per year? Show all mathematical calculations.
2.
If everyone is trained, how much will the training cost? How much will training cost if only the group with the most errors is trained? Show costs in a spreadsheet and all mathematical calculations.
3.
If everyone is trained, what is the cost savings for the first year? If only the group with the highest re-cleaning requirements is trained, what is the cost savings for the first year? Show all mathematical calculations.
4.
What is your recommendation? Should just the group with the most re-cleanings be trained or should both groups be trained? Provide a rationale for your recommendation. Show any mathematical calculations used.
5.
Let’s back up and assume that employees had the KSAs needed to clean the offices effectively. What other factors might you look at as potential causes of the re-cleaning problem?
