Improving Employee Retention

This is article is part of a series of monthly articles produced by Harbour Results for PMA’s MetalForming Business Edge e-newsletter. Click here to view the full collection of articles.

Spinning a Revolving Door Faster Isn’t Going to Help

Despite 789,000 U.S. residents joining the civilian labor force in January 2022, labor availability continues to be a constraint for manufacturers. As recently as this week, I heard a CEO tell his human resource manager, “I don’t care, just get the people in the door!” I heard another manufacturer was using mouth-swab saliva drug tests in the break room on an employee’s first day to eliminate the delay of a proctored urine test result.  And, to get people working on the shop floor fast, I’ve heard other manufacturers are cutting back on onboarding and training. But if the problem lies in people leaving within the first 90 days or even the first 12 months, rushing people into the shop isn’t going to solve the problem of getting parts and products shipped on time.

Unless your shop has very robust processes and systems not requiring any reliance on tribal knowledge (and the results from our PMA Sponsored Strategic Assessment Program suggests few of you do), employee productivity will only come after a period of learning and experience. Until then, inefficiencies and risk to quality can hamper your shop from shipping full orders on time. With an ever-increasing list of late orders and non-conforming products in quality hold to be re-worked, the knee-jerk reaction of operations staff is to ask for more people. But adding people at a faster rate than sales growth means costs go up and throughput and profit go down.

Instead of trying to get a revolving door to spin faster, your goal should be retaining the people you have and decreasing the time it takes to get new hires to be productive.

Similar to selling a house, you should start with giving a serious look at your “curb appeal” outside and inside. Does your shop look like a nice place to work: clean; organized; well-lit; functioning and maintained restrooms; reasonable temperature control; etc.? Is communication positive or are the walls full of “Do Not” signs? Is the information an operator needs easily accessible, like on a screen with pictures and videos, or is it buried in extensive text somewhere within an oily 3-ring binder in a drawer? Remember, just because your shop looks like manufacturing plants have historically looked doesn’t mean it has to or should stay that way.

How Are You Onboarding?

Bottom line: don’t skimp on onboarding and training. But that does NOT mean you should spend days in a conference room watching pre-recorded videos and/or slide shows. Instead, your onboarding should include a mix of classroom and hands-on activities to “try out” the job. Repeat critical lessons visually, audibly and through practice. Verify your new hires understood the training through conversations and demonstrations, not with quizzes. Also, many companies have found success in new hire integration and retention by assigning volunteer employees to a new hire as an ambassador/mentor/buddy to answer questions and be a reliable, consistent friendly face in the workplace.

Be sure you are interacting with your new team members continuously. Go see them weekly, or more, to see how they are doing, see if they have any questions or concern or if they need anything. This engagement demonstrates your commitment to employees and provides an opportunity for direct feedback.

What is Your Why?

And my last recommendation is to start with your “why.” Why does your organization exist? Is there a common purpose or mission? At its core, manufacturing has a compelling why: to use raw materials to make something that people can enjoy or use for some other purpose. To see something you had a part in making move down the road, on a store shelf, or being used by others can in-and-of-itself be a source of pride.  And your organization likely has a cultural or organizational “why” beyond just making something.  Belonging is a human need. People want to feel they belong to something that has a greater purpose. Starting with your “why” when new people walk in the door gives them something they can immediately identify with and decide to be a part of.  

While labor market constraints prevent you from throwing too much labor at the problem, it nevertheless is a constraint to growth. Fighting against that constraint by trying to get more people and putting them into production faster is likely counter-productive to profitable growth. Retaining employees and helping them learn faster is a more effective way to get quality parts out the door on time. And remember, those fresh eyes may be able to offer new ways to eliminate waste to make the job, and as a result, your shop, even more productive. 

About the author: Jason C. Brewer, a director at Harbour Results, helps clients develop competitive business strategy based on sound studies of their existing and potential markets, aligning their go-to-market activities and driving their operations to meet or exceed benchmark performance. In addition to over a decade of experience consulting manufacturers to drive profitable growth, Jason has held management and executive positions in business development and strategy. He is a certified Strategic Management Professional (SMP) by the Association for Strategic Planning.