What Keeps Workers Around?
Article upon article and report upon report state the same facts, blue-collar workers have increased expectations in what they want out of a job. The top factors motivating these workers are:
- Pay Rates
Pay rates continue to be a big driver of job choices. Consistent pay increases are the second-most-important factor employees consider when choosing a job. - Flexibility
Shift and schedule flexibility, while always important, have risen to even higher levels of importance today—representing one of the top three factors for staying on a job. - Chance for Advancement
The opportunity for advancement is a significant motivator in keeping workers engaged, motivated, and productive. Moving into management ranks can help keep employees engaged while also offering benefits for your company. - Company Culture
Culture matters to employees. Focusing on culture creates a positive working environment. Working together as a team creates experiences that resonate and reward.
A Focus on Profitability vs. Revenue as Markets Tighten
Companies and their operations leaders are increasingly recognizing that the traditional focus on revenue is no longer relevant, especially in the tight markets we now operate in. After all, it doesn’t matter if you make $1 million in revenue if you have $800 thousand—or even $1.2 million—in expenses.
Margin matters. The more companies can do to drive expenses out of their supply chain, the more profit they’ll have.
It’s not a new concept, but it’s receiving renewed focus in a tight economy where costs are rising, capital is declining, and labor costs often reflect a significant portion of any company’s budget.
In this tough market environment, companies are also facing shifting consumer sentiment and new expectations for dealing with suppliers.
The Pandemic Continuing to Drive BOPIS
Consumer shopping patterns have changed significantly during the pandemic. And, as the pandemic continues, those changes also continue—with wide variation based on geography and the ongoing state of concerns about the virus.
One of these trends has been the increase in interest in BOPIS—buy online, pick up in-store. BOPIS demand is projected to continue this 2022 holiday season. Any delays at the dock will prove costly if shipping isn’t on schedule. Workers need to be more efficient than ever before—and more adept at working as a team.
Now is the time to be thinking and planning for these impacts.
Manage Holiday Staff With a Strong Partner
Experienced operations managers know that the hardest part of gaining efficiency is people logistics. To improve your management here, address issues such as:
- Do you have the quality and quantity of staff on deck to meet holiday demand?
- How can schedules be flexible to handle peak demand, shifts in demand, or the unexpected--e.g., weather-related travel events?
- How can you get and keep workers engaged and motivated to maintain productivity?
- How can you balance costs and output to maximize ROI?
These are critical issues that fall directly into the laps of operations leaders tasked with finding opportunities to overcome emerging supply chain challenges--and to do it during the busiest time of year for shippers.
Avoid Being Stretched Too Thin
Operations managers are very busy and charged with critical aspects of managing operations to ensure customer needs are met efficiently--and cost-effectively. Their expertise is in logistics and process management--and not, necessarily, people management and motivation.
While people are obviously a critical part of the process, people management often pulls operations leaders away from areas of strategic impact where they are uniquely positioned to provide real value.
The best solution to address supply chain bottlenecks this holiday season is to outsource the most difficult challenge you face every day—finding, onboarding, training, motivating, and retaining top-quality workers who come together as a team to achieve maximum efficiencies. All, while also controlling costs and being able to forecast expenses accurately.
You can take the uncertainty out of the staffing costs equation while, at the same time, ensuring a high level of production. Having a fixed-cost model to handle your warehousing needs this holiday season protects your margins while motivating your people.
Managed service takes away the headaches of managing workers while providing guaranteed results:
- Better source of qualified staff.
- Predictable costs.
- Greater staff engagement and productivity.
- Better output.
- Better chances of meeting customer demands despite supply chain bottlenecks and uncertainty.
HIGHER PRODUCTIVITY
20% GAIN IN RETENTION
UP TO 35% HIGHER WAGES
WITH STATIC COSTS
STRONGER LEADERSHIP
BETTER MORALE
STRONGER CULTURE
Cost Per Unit Explained
How does a CPU model work? Each person on our teams are paid the same wage, and as the team becomes more efficient and productive, the pay rate increases while customer costs remain static. The model works because it is in everyone’s best interest to get the entire team to be as productive as possible.
In a traditional hourly payment model, workers are incentivized for the amount of time they put in. When unloading a truck, for instance, the longer it takes the more they’ll be paid.
But when you flip this model and, instead, pay people on a Cost Per Unit basis, or $X for every item or box they unload from a truck, it doesn’t matter if it takes them 10 minutes or 10 hours. The more they unload, the more they make.
That provides a significant benefit—and a big incentive—for them. It also provides a considerable benefit, and peace of mind for our clients.
Under a Cost Per Unit model, you know exactly what it will
cost to have a product unloaded.
Paying for Performance Is Not New - and it Works!
Paying workers based on output is not a new concept. In fact, there are decades of research and reports to support pay-for-performance (PFP) over a pay-for-time model.
According to a study published in the Journal of Applied Behavior Analysis:
"PFP systems produce higher rates of performance and more time on tasks than PFT systems. This finding replicates previous research that has evaluated PFP systems."
Under this type of productivity pay model, teams work together to get the job done as efficiently as possible, so they all optimize their pay. The most seasoned team member is inclined to help coach and assist the less seasoned team members because when one performs well, the entire team is compensated for that high performance. No one is left behind.
Increase pay to your staff by 35%, with no increased labor costs to you!
The cost per unit structure leads to a better team environment, a strong culture, and, consequently, greater retention and less turnover. In fact, at Eclipse IA, we’ve seen a steady 20%+ gain in retention when our clients tie wages to performance. This is a huge benefit for our warehouse clients, but workers also benefit—we’ve seen wage increases of up to 35%, without increased labor costs for our clients.
A model like this is one major driver of the ability to keep adequate workers on board—a big boon during the impending holiday season when talent will be in top demand.
Get Started
You can survive the holidays this year if you manage your headcount, which maximizes productivity, the biggest challenge facing retailers and distributors this holiday season.
This holiday season, pay less—get more—with a warehouse worker model that doesn’t cost, it pays!
