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Perks that Work

Perks that Work


Dining Services employees at the University of Maryland College Park agreed to model for FM s photographer for this story. Above: Maria Muñoz, Judith Scott, Rosa Pineda and Larry Donnelly; following spread: Yoshi Gomez and Phillip Reese.

Top prize in the employee retention sweepstakes has unof cially been awarded to a couple of software company executives who are handing out keys to new BMW automobiles to employees who stick around for more than a year.

One of the executives told The New York Times in June that the $270,000 cost of the rst installment of the BMW incentive (annual lease on each $31,000 car runs about $7,000 a year and insurance another $2,000) compared very favorably with the approximately $900,000 he had spent on recruitment and training in the previous 18 months.

It s only fair that the ashiest new retention strategy comes from the software industry, the most competitive, high-paying, job-hopping market out there. But what is happening in high-tech industries is being replicated although on a smaller scale, at a slower pace throughout the U.S. in all industries and at all levels.

More of us are changing jobs more often. A 1997 poll reported that 53% of all working people expected to quit their jobs within ve years. A 1998 survey reported that on average, employees were changing jobs every three to four years. In a national survey released this year by Kepner-Tregoe, a Princeton, New Jersey-based international management consulting rm, 60% of the 1,290 survey respondents admitted they themselves think about leaving their job one to two times a year. And in the U.S. as a whole, annual turnover is estimated at 10 to 15%.

Foodservice is and has always been at the heavy end of the turnover scale, with rates of 100% and higher common among entry-level foodservice jobs. Onsite foodservice directors, while not yet lining up in car dealerships, are exploring a variety of strategies in their efforts to motivate and retain employ-ees at all levels. They ve got good reason.

Successful retention of employees makes good business sense; out-of-control turnover can have a devastating impact on any operation. The nancial cost of losing an employee is just the beginning. There s the cost of termination, cost of hiring and cost of the new hire. The Kepner-Tregoe study, entitled Avoiding the Brain Drain, put the replacement cost of a fast food chain store manager at $21,931 and the replacement cost of a kitchen or counter person at $1,520.

Consider, for a moment, the line item costs when an employee leaves:

  • the cost of processing the employee out of your department and off your payroll;
  • money spent advertising the job;
  • time interviewing applicants;
  • time and manpower spent training the replacement and salary paid during training;
  • lack of productivity/contribution during training;
  • decline in a department s overall meals per man hour while other employees get used to a new co-worker, compensate for his lack of productivity, answer his questions, correct his mistakes and integrate him into group;
  • less ef cient customer service; and
  • lower quality results while waiting for the new employee to get up to speed.

You see a wide range of numbers when you talk to people about what turnover is costing them, says Michael Carter,, vice president of The Hay Group, an international human resources management consulting firm.

But if you re a foodservice operator with 100% turnover, your costs are high and you ought to be doing more to retain people. The guy who bought his employees BMWs obviously decided that the cost was worth it if it kept his employees on the job.

Foodservice directors have been forced to be creative when it comes to retaining employees because so many of the parameters of their departments jobs are beyond their control, particularly with regard to pay and bene ts. But that isn t necessarily a big dis-advantage. Increasing pay levels, the knee-jerk management response to increased turnover in the past, is not a magic bullet.

In fact, when Kepner-Tregoe asked work-ers and managers what they believed were the three most common reasons high-performing employees had left their organizations, 56% of the respondents did not select money as one of the three. Instead they selected limited opportunity for advancement (33%), not feeling valued (26%), and con ict with supervisor/manager (16%).

An especially startling nding was that while many surveyed managers and workers report that their companies have tried all 10 of the retention strategies listed in the survey, a similar number said these strategies have proven ineffective (see Perks chart).

Companies in the foodservice industry, because of their smaller pro t margins, have had to be very innovative in coming up with ways to retain their employees, says The Hay Group's Carter.

Stock and retirement plans are two areas that are getting a lot of attention because everyone is worried about saving more for retirement, but many work-ers have no employer-provided retirement bene ts, he notes,, adding that the effectiveness of retention strategies often varies with the age of the employees.

Generation X-ers are different from baby boomers, he says.. The X-ers are looking to develop their careers, make money, and enjoy their free time. They ask, Am I learning? Am I growing?

Baby boomers are looking for a balance between their work and personal lives. They re more interested in family-friendly policies and exible bene t packages. There are no hard and fast rules on what works and what doesn t. It comes down to what works in your operation with your employees.

To help you consider all your options, we offer this sampling of retention strategies that have proven successful for several onsite foodservice directors.

When Dan Zellner arrived at Pendleton Memorial Methodist Hospital, in New Orleans, as director of food and nutrition services for Morrison Healthcare Foodservices, in 1995, turnover was running up to 70% and production was plagued with problems caused by absenteeism. Today, turnover is running below 20% and Zellner gives credit to an empower-ment/motivational program which he dubbed STAR (Start the Astonishing Recognition).

The program focuses on recognizing positive job actions and contributions by employees. All employees at all job levels have the opportunity to accumulate points as they move through a succession of six program levels. In its rst three-year pilot, three of the 60 foodservice employees achieved the top level, while 92 percent completed at least one level. Each new level carries an increase in base pay and a variety of honors and gifts.

The positive actions include submitting ideas that generate revenue or reduce costs, conducting in-service sessions for other employees and working for fellow employees who call in sick.

More Hours
At Mount Holyoke College, in South Hadley, Massachusetts, Dale Hennessey, director of dining services, says her most successful retention innovation is trying to arrange year-round employment for dining services employees who desire it.

I can count on one hand the number of employees who don t want summer work, she says. We can t do anything about the academic calendar. But we can be creative about searching out opportunities for summer work.

What Hennessey has done is forge part-nerships with other campus departments, including conference services, buildings and grounds, and a greenhouse/nursery.

The shifts, as well as the work, itself usually are very different in the summer jobs, she says, but the employees seem to like the break from dining services. Some of them enjoy working outside in the summer and some of them like the early shift they get in housekeeping.

We just negotiated a new-four year contract in which we spent a lot of time looking at how bene ts are affected when employees don't work year round, says Hennessey..

We ve tried to even out peaks and valleys by changing the way health bene ts are calculated for employees. The employee contribution used to be calculated on a week-to-week basis, so employees would have to pay the full cost of bene ts for weeks they were not working. Now their contributions are based on the average number of hours worked over a 52-week year.

Work Environment
When you get to the heart of why we have employees who have been here for 38 years, they stay because they like what we have created here, says Pat Higgins, director of dining services at the University of Maryland, in College Park. They like the people they work with, the university setting with the red brick and the Georgian architecture, and the feeling we have here of family.

There is a camaraderie and a pride in what we do, and that has increased as we have become more involved in activities of the university at large.

That involvement has us working with people throughout the school, and it has changed our reputation so there is a widespread recognition that there s more to us than three meals a day.

An information technology employee who joined Higgins staff as an undergraduate,, for example, has since received his master s degree and remains on her staff.

For him the attraction is, I think, the challenge and variety of the job, she says..

He's got three professional staff working for him now and the areas they get involved in are always changing.

Higgins says an annual three-day staff retreat at an off-site conference center also contributes to team spirit and produces a mindboggling number of ideas and suggestions for improvements and changes.


Helping Employees Balance Work and Family

TRADING PLACES. Libby Showalter, left, with son Michael, and Natalie Thompson, right, with son Jarrod, consider their shared job arrangement a long-term solution to the challenge of balancing career and family.

Libby Showalter, MS, RD, a clinical dietitian at Louis Stokes Veterans Administration Medical Center, in Cleveland, Ohio, was just three months pregnant with her first child when she began to investigate ways to combine her professional career and stay-at-home motherhood.

I love my job, I love my patients, and this is a great community of people I work with, she says. I didn't want to just walk away from what I had built up here.

Showalter s rst discussion of her options was with her sister, an organizational behavior professor at the University of Southern California, who raised the idea of job sharing.

Her second discussion was with her boss, Warene Hopson, RD, chief of nutrition and foodservices at the VA. I am very loyal to this facility so it was important to me that whatever I worked out not be a hassle or a hindrance to the department, says Showalter.

But from the very rst minute I mentioned the idea of job sharing, Warene, Lois Lenard, RD, her assistant chief, and Linda Reese, MS, RD, my supervisor, have been totally enthusiastic. You don t know how good that made me feel. You have to understand that this was a real commitment for them and a lot of work to set up because we are a government agency and making a change like this is not easy.

The fact is, I didn t want to lose her, Hopson explains. At the time, Libby had been employed here for four years and she was in our intern-ship program before that. She was a great employee and I wanted to nd a way to accommodate her. As a government agency, we are not always as family friendly as I think we should be and I personally thought we should try to make this work.

The key to making it work, of course, was nding the other half of the shared job. Hopson was still considering that problem when Natalie Thompson, MS, RD, walked into her of ce one day to show off her 10-month-old son, Jerrod, who had been born nine months after her graduation from the hospital's dietetic internship program.

I got pregnant the same month I graduated from the internship program so I had never really gotten started on my career, Thompson recalls. I had not looked for a permanent job as a dietitian because I didn t want to quit on someone after the baby was born.

When Warene brought up the idea of a shared job, it caught me completely by surprise. I told her I had to think it over but I called back later the same day and said yes. It s the best of both worlds. I enjoy my time at home more when I m there, and the 20 hours a week at work is just the right amount to keep me fresh with my skills.

Hopson created two permanent part-time jobs from Showalter s single full-time position. Showalter and Thompson split the work week at Wednesday noon, with each working 2 1 2 days of the week. Each of them accrues sick leave and vacation leave based on hours worked in the VA system.

Our department and patients get a lot from these two, says Hopson. When they re here, they re attentive, energetic, enthusiastic, and they re never burned out.

Helping Employees Buy a Home

A HOME OF THEIR OWN. New Haven Mayor John DeStefano (left) joins the Ben-Elohim family in celebrating their move into a house purchased with the help of Yale University s Homebuyer Program.

Angela Ben-Elohim passed the house undergoing renovation at 89 Bristol Street, in New Haven, Connecticut, every day as she walked to her dining services job at Yale University. She, her husband, Zephaniah, and ve children lived two doors away in a three-family house owned by her mother.

There was a phone number for the developer on a sign out front and I wrote the number down a couple of times and stuck it in my purse, Mrs. Ben-Elohim recalls. The idea of owning that house seemed out of reach for us. But I knew other people who work with me in dining services who had bought their rst house with help from the Yale Homebuyer Program. One day, I found the number again and I just decided to call.

That call to the developer in June of 1998 was the rst link in a chain of events that took the family through banks, mortgage companies, credit agencies, the city s housing bureaucracy, state funding agencies and the Yale Homebuyer Program. On May 25, the family closed on the purchase of the totally restored, 121-year-old historic home and family members began carrying in their furniture from two doors away.

There were plenty of days we wanted to give up, she says. It s not like you see something in a store, walk in, buy and carry it home. You never know a house is really yours until you get through that closing. So many things can go wrong.

The Ben-Elohim family is just one of 352 Yale faculty and staff, including 48 service and maintenance workers, who have purchased New Haven homes through the innovative employee incentive program launched in 1994. The program currently provides $25,000 over a ten-year period to Yale employees who buy and live in homes in targeted city neighborhoods. Ben-Elohim s rst housing check from the program was for $7,000 ($4,100 after taxes) and she will receive annual checks of $2,000 for 10 years, as long as she remains employed by the university.

But the program offers more than cash. It also offers hand-holding in the form of Bill Carney, the program s director, who Ben-Elohim describes as an angel. My family has adopted him. He encouraged us, he made phone calls for us, he helped us with the paperwork, and when the checks came through from Yale, he brought them to us at home on a Sunday evening.


Helping Employees Continue Their Education

Whenever Cindy Ketterman Hopkins, MS, RD, got a tuition reimbursement check for the master s degree courses she was taking, she sent a thank-you note to her employer, York Health System, in York, Pennsylvania.

This was something that ultimately bene tted me personally, she says. It was something I had decided I needed for my professional career and something I was prepared to pay for myself. But they were paying for it as part of their employee tuition reimbursement program and I wanted them to know I appreciated it. At that time, the reimbursement was 75% of the cost of the courses and they never questioned the amount, even though the program I was enrolled in was very expensive. They didn t even question my last course, which I think cost $1,500 a credit.

Ketterman Hopkins, now the chief clinical dietitian at York Hospital, says she enrolled in graduate school when she rst began working for the hospital as a clinical dietitian 17 years ago. It took her more than three years of year-round studies one night course at a time to earn her master s in Human Resources Administration.

Lawanda Spotts, director of food and nutrition services at York, says the college tuition reimbursement program is a very popular bene t with employees and a key factor in attracting and retaining employees at all levels. She says her employees have used the program to get everything from culinary training to computer degrees in recent years.

Ketterman Hopkins says she knows of three other registered dietitians who have used the program to earn their master s degrees while employed at York. And Spotts says the fact that the program is available to anyone working at least 16 hours a week helps her ll part-time tray service positions with students from York College, located down the hill from the hospital. Part-time employees qualify for 50% reimbursement.

Ketterman Hopkins says the tuition reimbursement, while appreciated, isn t the reason she has stayed at York for 16 years. My ties here go deeper than that. My mother was a nurse here and eventually became the nursing supervisor, there s a building on campus that is named after my great aunt, and when my father suffered a heart attack at the age of 49, he was a patient here. In fact, Mrs. Spotts was his dietitian. I remember being in his room when she visited him.

Do the Perks Work?

Has your organization taken any of the following actions to reduce employee turnover?

Have these actions been effective or ineffective in reducing employee turnover?
Percent Answering Yes Percent Rating Ineffective
Made salaries/financial rewards more competitive 69% 65% 29% 40%
Improved bene fit packages 60 64 27 37
Given employees more authority/
65 64 37 50
Provided more recognition for superior performance 51 53 40 54
Instituted a flexible work schedule 55 59 36 36
Provided day care facilities 34 43 52 54
Provided services to meet personal needs (e.g. laundry,auto repair,pets at work) 32 42 51 56
Allowed employees to work at home some or all of the time 41 46 42 54
Provided greater on-job training 48 54 36 43
Established well-defined career paths 36 43 52 56
Source: The Kepner-Tregoe survey on employee turnover, January 1999

What Works with Part-Timers

With the late-1995 expansion of Senior Campus Living (SCL), a Baltimore-based builder and manager of continuing care retirement communities, company executives began to be concerned about losing touch with their employees.

With two communities, we felt we had a pretty good idea of who our employees were and what motivated them, says Kerry Jones, SCL s director of management services. As we opened our third community and began to plan for others, we realized we didn t want to lose that sense of who we were.

That concern led to the hiring of Halloran Consulting and the implementation of a formal program of in-depth employee and customer surveys. The survey ndings are used to design employee retention initiatives, many of which re ect the fact that two thirds of the department s employees are part-time high school students. Among them:

  • A scholarship program that awards $1,000 annual continuing education grants (renewable for four years) to students who work at least 1,000 hours during junior and senior years of high school.
  • A staff enrichment program that encourages employees to come together outside work hours for discounted or free recreation and entertainment activities, including sporting events and picnics. Doris Henning, an SCL dining services director, says the social events translate into more smiles in the workplace and a friendlier work environment.
  • A formal, seven-hour orientation program that re ects the fact that the job is often a student s rst and only work experience and that they have no point of reference on skills or expectations.
  • Daily verbal brie ng sessions prior to meal service on policy or menu changes, upcoming events, etc. We had been using newsletters to communicate, but students weren t reading them, says Henning. They told us they get enough reading at school.
  • Public recognition of student employees of the month. Winner receives a gift certi cate and his picture posted on the dining hall hostess stand so residents can join in recognizing him also.
  • Immediate grati cation awards for special achievements by students, including movie passes and gift coupons.
  • More exible scheduling. Henning recon gures student work schedules each semester to reflect changes in class schedules and seasonable after-school activities.
  • Career development that has moved student employees into positions as assistant managers in training.
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