ManageBasics.com

The Initiative

The number one reason people didn't stay at Admiral: transportation. Not money. Not benefits. Transportation. The resounding reason that the surveys cited was difficulties created by lack of transportation.

“We never would have worked this out on our own, Greg,” Simon said. “And the reason is because we take our cars for granted as part of our everyday lives.

“They don't live near where they work. Many don't have cars or even a driver's license, and they're often working at hours when public transportation is either not available or just too dangerous. Would you want to stand around waiting for a bus in some parts of town?” Simon explained to a disbelieving Greg.

“It's never what you think it would be,” Greg exclaimed. “I thought they'd just say 'money.'”

Simon smiled. “Don't get me wrong, they'd like more money, too. But the transportation dilemma was mentioned twice as often as financial compensation.”

“Okay, so what do we do now?” Greg asked. “You're not suggesting we buy them all cars, are you?”

Simon ignored the sarcasm and explained, “My team has thrown around a few ideas, including coordinating a carpooling system, but it's too unpredictable. What we need to do is put together a shuttle system to bus our employees from their neighborhoods to the job sites.”

Greg just looked at him for a moment. “You've gone too far now, Simon. You're either on drugs or you need to be on drugs.”

“You said you wanted to solve the turnover problem, Greg. You can throw more money at them, but money won't have a real impact. If you're serious about tackling this turnover issue, transportation is the one thing that will impact this situation the most. The employees have told us that. Now we can do something about it, and in the process, win their trust and increase morale, which are bound to have an impact on efficiency and productivity. Or we can ignore what they've told us and the problem will continue to perpetuate itself.”

“I'm scared to ask the next question,” Greg commented.

“Then don't ask it,” Simon said, interrupting. “It's the wrong question anyway. The question is not, how much is this going to cost us? The question is, how much is this going to save us? Depending on who you listen to, the cost of turnover is anywhere from 25 to 150 percent of an employee's annual compensation. In the case of a manager or executive, the estimate ranges from 100 to 225 percent. This means, based on our current payroll, turnover is conservatively costing us two million dollars a year. That's almost $170,000 a month, or $40,000 a week!”

Greg just glared at him, but Simon wasn't finished.

“I asked my team to work up a couple of scenarios and price them out, and I think we can pilot a shuttle bus program for between twelve and fifteen thousand dollars a month, and I think it will decrease turnover by at least 20 percent. Do the math, Greg. Give it three months. By then you'll know. In fact, you'll probably know long before then.”

“All right,” Greg agreed reluctantly, “but if you're wrong…”

Simon cut him off again. “No more threats, Greg, because the truth is, I'm miserable the way things are. If we can't get at this turnover issue, you won't have to fire me — I'll quit.”

The following week, the shuttle bus system was announced. Three weeks later, it was fully operational. During the day, Admiral would bus employees to and from certain locations in four key neighborhoods, and at night they would bus them to and from their homes.

The results were almost immediate.

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