Advance Auto Parts (NYSE: AAP), headquartered in Roanoke, Virginia,[3] is the second-largest retailer of automotive replacement parts and accessories in the United States. AAP was founded in 1932 and had 2008 sales of approx. $5.1B. AAP operates 3,540 stores in 40 US states and employs over 51,000 Team Members across all operations.
In 2005, Advance Auto Parts purchased Autopart International, Inc. which operates 202 stores along the Atlantic Seaboard.
The company is Advance Auto Parts, and the scene of these. achievements is the nine ... Tonya Baker is the director of Talent Management Systems at Advance Auto ... critical to organizational success, and a pre-hire assessment could make a difference, who wouldn’t consider implementing a system and gathering the right data to make a serious impression on senior management? When the success of a nationwide retail giant depends on a few thousand entry-level employees in a high-pressure, high-churn position, Human Resources is bound to face some workforce management challenges. And if a history of high turnover rates and less-than-stellar performance are part of the job, senior management is going to expect some solutions. So how do you get their attention? You boost 90-day retention by 87%, and increase on-the-job performance by 33% as well. That makes an impression.
Introduction
The Canadian Plastics Sector Council - Conseil canadien sectoriel des plastiques (CPSC) has identified worker retention/turnover and knowledge transfer as issues critical to the sector’s efforts to meet its anticipated skill needs. The ability of employers to address employment growth as well as replacement of turnover and retirements pose increasing human resource challenges. The CPSC has identified a strong demand, within CPSC and other sector councils, for research which consolidates available ‘best practices’ and solutions for dealing with these issues.
This report - commissioned by the CPSC and carried out by the Canadian Labour and Business Centre (CLBC) - provides a comprehensive analysis of best practices in worker retention and knowledge transfer strategies. The report has two parts: 1) a review of the literature on best practices in retention and knowledge transfer, and 2) case studies of best practices within Canadian Plastics Manufacturing firms. Together, the documentation of these best practices can provide helpful and practical guides to other firms dealing with similar challenges.
The Importance of Worker Retention and Knowledge Transfer
When a business loses employees, it loses skills, experience and “corporate memory”. The magnitude and nature of these losses is a critical management issue, affecting productivity, profitability, and product and service quality. For employees, high turnover can negatively affect employment relationships, morale and workplace safety. The cost of replacing workers can be high, the problems associated with finding and training new employees can be considerable, and the specific workplace-acquired skills and knowledge people walk away with can take years to replace.
The problem of turnover can be addressed through a variety of pro-active retention strategies: workplace policies and practices which increase employee commitment and loyalty. Knowledge transfer initiatives on the other hand, ensure that the knowledge and expertise of a company’s employees—its 'corporate memory'—are systematically and effectively shared among employees. They can offset the negative impact of turnover, but can also work pro-actively to reduce turnover by providing learning and skills development opportunities to employees - factors known to reduce turnover.
Employee retention and knowledge transfer are two elements of a more general concern that might be best termed ‘skills management,’—i.e., everything that has to do with recruiting, maintaining and developing the necessary mix and levels of skill required to achieve organizational and business objectives.
The Case Study Process
The companies that participated in the studies were drawn from five provinces, varied in size from 26 to 1900 employees, reflected the full range of industry products from packaging, building and construction, electrical components, furnishings, automotive and transportation, and included both unionized and non-unionized workplaces. This deliberate variety reflected an objective of the study, which was to explore the form which retention and knowledge transfer initiatives took in vastly different types of workplaces.
Data were gathered through telephone interviews and a review of relevant documents. For each company profile, interviews were conducted with company officials knowledgeable about the firm’s human resource and organizational practices (such as HR managers and VPs, company presidents, CEOs, and owners). Where possible, interviews were held with workers or in unionized workplaces, union representatives, in order to provide an employee/union perspective on the retention and knowledge transfer measures and their impacts on employee satisfaction, career progression, and loyalty.
Best Practices in Retention and Knowledge Transfer
1. Competitive and Fair Compensation is a fundamental starting point in most strategies to attract and retain employees. However, there is general agreement that compensation levels do not single-handedly guarantee employee retention. Common best practices include the use of industry surveys to benchmark and position wage and salary structures to be fair and competitive. (Case study examples: hyperlink to Baytech; Canadian General Tower; Innotech Precision; IPEX).
2. Adequate and Flexible Benefits can demonstrate to employees that a company is supportive and fair, and there is evidence to suggest that benefits are at the top of the list of reasons why employees choose to stay with their employer or to join the company in the first place. Many companies are responding to the increasingly diverse needs of their employees by introducing a greater element of choice in the range of benefits from which their workers can choose. Flexibility in benefits packages can enhance retention, as it creates responsiveness to the specific needs and circumstances of individual employees. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
3. Innovative Compensation Systems and practices can have a positive impact on employee retention by motivating membership-oriented behaviour (commitment). Pay systems may also affect knowledge sharing and transfer if sharing, teamwork, suggestions, etc. are rewarded or recognized. Innovative compensation systems include gain sharing, skill-based pay and various types of bonus plans. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
4. Recognition and Rewards include a diverse range of formal and informal, financial and non-financial, incentives given to individual employees, groups of employees or to an entire staff. They include such things as employee of the month awards, companysponsored sports teams and social events, prizes, clothing, and so on. Recognition and rewards can contribute to a workplace culture of respect and appreciation for employees and work well done, and thereby reinforce employee commitment to the firm. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
5. Training, Professional Development, and Career Planning are effective ways to enhance employee retention. Training constitutes a visible investment that the company makes in the worker, providing him or her with new skills, and greater competencies and confidence. Training often leads to work that is more intrinsically rewarding. Combined with effective communication about how an employee’s efforts at developing skills will lead him or her to more challenging and meaningful positions within the company, training encourages workers to make longer term commitments to their workplace: it permits them to see a future with the company. All of the companies we interviewed were very active in the area of skills training and professional development. Many have put in place effective internal promotion programs that allow even their unskilled and semi-skilled workforce to move towards positions of greater responsibility and remuneration within the company. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
6. Recruitment & Orientation practices can be of crucial importance to keeping workers over the longer term. Employee retention is enhanced by ensuring a good “fit” between a company’s workplace culture—its way of doing business and the qualities that it espouses as valuable—and the interests, character, and motivations of the individuals that exist within it. Recruitment practices that emphasize not only formal qualifications (job-relevant technical ability) but also more general types of qualifications and dispositions on the part of the recruit can be part of an effective retention strategy. Our own case-based study revealed that employees in some workplaces, particularly the smaller ones, do more than merely work together: they often share similar interests and have a very strong inter-personal rapport, and these in turn help to bind them together as a cohesive whole. Indeed, the quality of interpersonal relations may contribute significantly to retention in its own right. Good initial orientation to the newly-hired employee can not only help to effectively integrate that person into the workplace but can also help to make the new person feel welcome and provide him or her information about how to cope with the demands of the workplace, and any possible problems that may arise. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
In 2005, Advance Auto Parts purchased Autopart International, Inc. which operates 202 stores along the Atlantic Seaboard.
The company is Advance Auto Parts, and the scene of these. achievements is the nine ... Tonya Baker is the director of Talent Management Systems at Advance Auto ... critical to organizational success, and a pre-hire assessment could make a difference, who wouldn’t consider implementing a system and gathering the right data to make a serious impression on senior management? When the success of a nationwide retail giant depends on a few thousand entry-level employees in a high-pressure, high-churn position, Human Resources is bound to face some workforce management challenges. And if a history of high turnover rates and less-than-stellar performance are part of the job, senior management is going to expect some solutions. So how do you get their attention? You boost 90-day retention by 87%, and increase on-the-job performance by 33% as well. That makes an impression.
Introduction
The Canadian Plastics Sector Council - Conseil canadien sectoriel des plastiques (CPSC) has identified worker retention/turnover and knowledge transfer as issues critical to the sector’s efforts to meet its anticipated skill needs. The ability of employers to address employment growth as well as replacement of turnover and retirements pose increasing human resource challenges. The CPSC has identified a strong demand, within CPSC and other sector councils, for research which consolidates available ‘best practices’ and solutions for dealing with these issues.
This report - commissioned by the CPSC and carried out by the Canadian Labour and Business Centre (CLBC) - provides a comprehensive analysis of best practices in worker retention and knowledge transfer strategies. The report has two parts: 1) a review of the literature on best practices in retention and knowledge transfer, and 2) case studies of best practices within Canadian Plastics Manufacturing firms. Together, the documentation of these best practices can provide helpful and practical guides to other firms dealing with similar challenges.
The Importance of Worker Retention and Knowledge Transfer
When a business loses employees, it loses skills, experience and “corporate memory”. The magnitude and nature of these losses is a critical management issue, affecting productivity, profitability, and product and service quality. For employees, high turnover can negatively affect employment relationships, morale and workplace safety. The cost of replacing workers can be high, the problems associated with finding and training new employees can be considerable, and the specific workplace-acquired skills and knowledge people walk away with can take years to replace.
The problem of turnover can be addressed through a variety of pro-active retention strategies: workplace policies and practices which increase employee commitment and loyalty. Knowledge transfer initiatives on the other hand, ensure that the knowledge and expertise of a company’s employees—its 'corporate memory'—are systematically and effectively shared among employees. They can offset the negative impact of turnover, but can also work pro-actively to reduce turnover by providing learning and skills development opportunities to employees - factors known to reduce turnover.
Employee retention and knowledge transfer are two elements of a more general concern that might be best termed ‘skills management,’—i.e., everything that has to do with recruiting, maintaining and developing the necessary mix and levels of skill required to achieve organizational and business objectives.
The Case Study Process
The companies that participated in the studies were drawn from five provinces, varied in size from 26 to 1900 employees, reflected the full range of industry products from packaging, building and construction, electrical components, furnishings, automotive and transportation, and included both unionized and non-unionized workplaces. This deliberate variety reflected an objective of the study, which was to explore the form which retention and knowledge transfer initiatives took in vastly different types of workplaces.
Data were gathered through telephone interviews and a review of relevant documents. For each company profile, interviews were conducted with company officials knowledgeable about the firm’s human resource and organizational practices (such as HR managers and VPs, company presidents, CEOs, and owners). Where possible, interviews were held with workers or in unionized workplaces, union representatives, in order to provide an employee/union perspective on the retention and knowledge transfer measures and their impacts on employee satisfaction, career progression, and loyalty.
Best Practices in Retention and Knowledge Transfer
1. Competitive and Fair Compensation is a fundamental starting point in most strategies to attract and retain employees. However, there is general agreement that compensation levels do not single-handedly guarantee employee retention. Common best practices include the use of industry surveys to benchmark and position wage and salary structures to be fair and competitive. (Case study examples: hyperlink to Baytech; Canadian General Tower; Innotech Precision; IPEX).
2. Adequate and Flexible Benefits can demonstrate to employees that a company is supportive and fair, and there is evidence to suggest that benefits are at the top of the list of reasons why employees choose to stay with their employer or to join the company in the first place. Many companies are responding to the increasingly diverse needs of their employees by introducing a greater element of choice in the range of benefits from which their workers can choose. Flexibility in benefits packages can enhance retention, as it creates responsiveness to the specific needs and circumstances of individual employees. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
3. Innovative Compensation Systems and practices can have a positive impact on employee retention by motivating membership-oriented behaviour (commitment). Pay systems may also affect knowledge sharing and transfer if sharing, teamwork, suggestions, etc. are rewarded or recognized. Innovative compensation systems include gain sharing, skill-based pay and various types of bonus plans. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
4. Recognition and Rewards include a diverse range of formal and informal, financial and non-financial, incentives given to individual employees, groups of employees or to an entire staff. They include such things as employee of the month awards, companysponsored sports teams and social events, prizes, clothing, and so on. Recognition and rewards can contribute to a workplace culture of respect and appreciation for employees and work well done, and thereby reinforce employee commitment to the firm. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
5. Training, Professional Development, and Career Planning are effective ways to enhance employee retention. Training constitutes a visible investment that the company makes in the worker, providing him or her with new skills, and greater competencies and confidence. Training often leads to work that is more intrinsically rewarding. Combined with effective communication about how an employee’s efforts at developing skills will lead him or her to more challenging and meaningful positions within the company, training encourages workers to make longer term commitments to their workplace: it permits them to see a future with the company. All of the companies we interviewed were very active in the area of skills training and professional development. Many have put in place effective internal promotion programs that allow even their unskilled and semi-skilled workforce to move towards positions of greater responsibility and remuneration within the company. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
6. Recruitment & Orientation practices can be of crucial importance to keeping workers over the longer term. Employee retention is enhanced by ensuring a good “fit” between a company’s workplace culture—its way of doing business and the qualities that it espouses as valuable—and the interests, character, and motivations of the individuals that exist within it. Recruitment practices that emphasize not only formal qualifications (job-relevant technical ability) but also more general types of qualifications and dispositions on the part of the recruit can be part of an effective retention strategy. Our own case-based study revealed that employees in some workplaces, particularly the smaller ones, do more than merely work together: they often share similar interests and have a very strong inter-personal rapport, and these in turn help to bind them together as a cohesive whole. Indeed, the quality of interpersonal relations may contribute significantly to retention in its own right. Good initial orientation to the newly-hired employee can not only help to effectively integrate that person into the workplace but can also help to make the new person feel welcome and provide him or her information about how to cope with the demands of the workplace, and any possible problems that may arise. (Case study examples: hyperlink to Baytech, Canadian General Tower, Innotech Precision, IPEX).
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