Episode 63 – Retaining Your Top Talent

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We’re back with another of the Linen Uniform and Facility Services Podcast, interviews and insights by TRSA. Thanks again for joining us. I’m your host, Jason Risley. Today, we’ll listen to the journey of how Prudential Overall Supply transformed its human resources department and honed in on retaining its top employees in a tough labor market. Michael Flores, the vice president of human resources and a member of the executive leadership team at Prudential Overall Supply, joins us today to share the details.

 

In his role, Flores is responsible for employee engagement as well as employee health and safety for Prudential’s 2,000 plus employees. So we were faced with a retention dilemma. Many of you were facing, similar struggles. So in 2020, our turnover, overall turnover had increased to over 40% for the first time. And then at the end of 2021, it had really escalated, and it had gotten up to 56%.

 

We knew that we had to do something. And as I mentioned before, our managers, they couldn’t really dig in on some of the strategies, that we were using because they were focused largely, throughout 2021 on just hiring and training and hiring and training and, working on exits. Hiring certainly had slowed for us. The competition for new hires, increased, Amazon and other location assuming, and other companies. They had, new start up locations throughout many of our market centers, and we were competing based on starting wage, wage rates that we just couldn’t compete with.

 

We began to get creative. We were working with staffing agencies. We had job postings on Craigslist, Indeed, different places, monster. We were offering, referral bonuses. Some of our locations got really creative.

 

We were working with local radio stations and placing radio ads. We had DJs in our parking lots. We had food trucks. We said, listen. Just stop by and hear our sales pitch.

 

We will feed you for the day. And so, throughout throughout all of those, creative steps, staffing increased a bit, but it still wasn’t solving the problem. Our labor cost, which is one of our highest costs, was really outpacing our targets. And so when you looked at what our company goals were for profit in each of those, recent years, we just weren’t hitting those targets, and labor was a large part of that. We were faced with overtime cost burdens.

 

That time and a half payout, was really hitting the bottom line in a difficult way. The core group of folks, those folks that were staying with us, what they were telling us is we’re facing worker fatigue. They said that you continue to ask us to come in early, and to stay late, to come in on Saturdays and sometime sometimes even on Sundays. For those of you that, that have shutdowns, during, during the Thanksgiving and Christmas holidays, you may have been faced with some of the same challenges, but our folks were coming in, on holidays. We had to get product out, and so we were faced with product challenges.

 

We weren’t we weren’t meeting those those needs or those demands. So that worker fatigue really concerned us. How much could our people take, before they broke? Promotions dramatically increased, due to our supervisors and managers, finding what they thought would be better opportunities elsewhere. And so, what we saw was a number of what I called battlefield promotions, where folks weren’t ready for the next role.

 

We did everything that we could to get them, trained and developed so that they could be effective in those new roles, but we had supervisor and manager managerial turnover, and, we went to the next person. And, many of those people stepped up to the challenge, and we were pleasantly surprised. When we looked at their results 3 months later, 6 months later, a year later, we asked them, how did you get through it? And they admitted it was a challenge. There were days that they thought about quitting.

 

There were days that they thought that they should not have taken the promotion, and then they that they would have been comfortable with just staying in the position that they previously held. We had a 133 promotions in 2021. We had just slightly less, than that. I think a 122 promotions, last year in 2022. As I mentioned before, we’re an organization, just over 21100 employees.

 

So those numbers, we had never seen those numbers before. But looking back at that, we made a lot of good decisions, and, some that maybe didn’t work out as well as we needed to. But, overall, we were happy with the outcome. So the business challenge in the summary here was to create a meaningful business strategy built around some achievable goals, that would be defined. We were gonna certainly share that with the business.

 

We were gonna track our progress, and we were gonna report that out to the organization. We wanted to make sure that we could launch this in a way that was big, that really caught the attention of all of our managers, and, we had a hard target of doing that within a 30 day, process. That didn’t seem achievable. How are we going to define it? How are we gonna build accountability?

 

And how are we gonna message all of this, within a 30 day period? And at the same time, we couldn’t disrupt, the current business. We didn’t wanna, disrupt employees or the overall operations. Lastly, we knew that we were facing cost pressures already, so we had to do all of this, within a reasonable cost back to the business. And so we said, okay.

 

What are our 4 pillars? What’s our strategy? What are what what are our focus areas? And we came up with 4 of these. We were gonna focus on training.

 

We knew that through those battlefield promotions, we had to equip managers with the tools that they need excuse me, needed, to get their people to stay. What would reporting be like? That was certainly gonna be one of our pillars. Probably the biggest one on this page is that third one. Who would be held accountable?

 

What should those roles look like, and how would we how do we actually communicate that, and how would we get updates from them? And then lastly, this needed to be something that that was, supported from the top down. So what did leadership need to know? How did they need to support the organization? What messaging was required from them, from the top down so that everyone really took this seriously because we were facing, as I mentioned before, turnover that the, excuse me, the business and organization just, just had not seen.

 

So here’s our steps. We were we were we were clear on our goals. We wanted to improve overall turnover, by 15%, by the end of 2022. We also wanted to improve new hire, turnover by 20%. We define that as folks leaving in the 1st 90 days.

 

But our first step was calculating turnover data. Previously, we really didn’t look at turnover data. We just accepted turnover for whatever it was. We didn’t have good measuring tools, in 2021. We we implemented, an, HRIS tool, that was the first, excuse me.

 

That was first HRIS tool that the company had ever used. That allowed us to really dig into the data, and we could look at it by the company overall, by location, by department, by function. That gave us a much better, much better view and where we’re seeing, the higher the the highest turnover. We wanted to create turnover reduction goals. That’s what that blue box represents over to the right hand side of this slide.

 

Without having goals, we didn’t feel that just having a blanket, goal or objective around reducing turnover would really meet, the needs of the business. And so we came up with something that we wanted to communicate out, which we did. When we came up with that strategy, we certainly needed to report on that. And we built a, communication strategy. We leveraged emails.

 

We leveraged postings because not all of our, staff members have access to email. So we built postings, that, that were that were produced and posted, around all of our different locations. We had various meetings, town halls, and this was at the top of the list. So every agenda, turnover was included so that it stayed fresh. It stayed on everybody’s radar.

 

And then, as I mentioned at the outset of this presentation, we reviewed all joiners and leavers. We had Tuesday calls. Our region managers hosted this, and the audience was each of our general managers. And the Tuesday calls went line by line, individual by individual, and we talked about who did we lose and why, who did we hire, What roles are they filling? And then what are we doing to ensure that they will stay with us certainly past the 90 day mark?

 

That was our first target. And then from there, we would look at the 1st 2 years. Those Tuesday calls were one of the best ideas that we better that we had, because it really brought it, to a senior level through our regional directors, as well as our general managers, that they knew that the organization was paying attention to this, not just on a regular basis, but on a weekly base basis. We also reviewed our benefit plans. There were a number of pieces, that we added, during the course of the last 2 to 3 years.

 

And then then what we said is, are the new hires and even our current employees, are they getting a consistent message about what our benefit plans include? For those current legacy employees, folks that have been with us for 2 years, 5 years, or beyond, they can forget about all of the benefit pieces that we offer. And so we created employee videos. These are somewhere between 15 to 20 minutes long. And, we asked all of our current employees, to have a chance, to view these.

 

We produced these in both English and Spanish. Our new hires, were required to view these because we knew, that while we were paying a competitive, market wage, we weren’t paying at the top. And so we were competing with other organizations in our markets. They were probably paying more, but we’re really proud of our benefit plans, and we wanted to make sure that people understood that part of the story. As I mentioned, we added a number of elements to our benefit plans, and then we went out to every one of our locations, and we told that story.

 

We created benefit guides. These were things that they could take home and that they could share, with their family, and not just the traditional, health, dental, and vision, benefit plans, but we wanted to make sure that not only our employees, but also their family members, knew the full benefit package packages. So we created QR codes. Many of our staff, they’re not familiar with technology, but the folks at home are. They have children.

 

They have nieces. They have folks in the home, that can walk through that and explain to their, to their family members, things that were really, unique, around profit sharing, around 401 k contributions, around tuition reimbursement, around a death benefit, that folks get that they don’t know. And, unfortunately, we had some employees pass, over the last over the last few years, and their families received $10,000 that they had no idea was coming, to help to help cover, funeral expenses. And that had been on the books, and that had been part of our, benefits, scheme for years, but they didn’t know about those. And so we went out, again, to all of our employees, all of our locations, to make sure that they knew that story.

 

We conducted employee surveys, and as I mentioned before, we rated every single employee, whether they whether we thought that they were high risk, high potential, whether they were high performers or low performers, whether they were new joiners, legacy employees, it didn’t matter. We rated every one of them as green, yellow, or red. For those red employees, we identified strategies, that we employed, and we looked at a number of risk factors. And you can see those here in the following bullets where we looked at their tenure. For those folks with the shortest tenure, those are the folks that are most likely to leave.

 

They haven’t built that relationship with their manager yet. They haven’t built that relationship with the organization yet. They haven’t built up their stamina, for their work schedules, to stand, excuse me, to stand at their workstations, for a full day. We wanted to understand what what was their commute like, Fuel costs for vehicles and commute costs in general had just increased dramatically. And so we knew that we were competing, not only with local employers, near our facility, but also, those employers that were that were closer to, workers’ homes, because if they could commute excuse me, if they could cut down on their commute, they could certainly save on fuel costs.

 

Pay satisfaction, we provide merit increases, every January, but we said, maybe we can do that a bit differently. And so we looked at some off cycle pay increases, that we used, excuse me, throughout the course of the pandemic, and that really meant something. And, that brought down the flight risk of some of our, yellow and red, staff members. Just the overall role satisfaction. We knew that there were voices out there, that had talked about some dissatisfaction with their role.

 

We wanted to know more about that. And so through these conversations, we learned more, and then we created status excuse me, strategies to, hopefully answer those. Now for a brief message from TRSA. Hey. Hey, my TRSA friends.

 

I hope you have already blocked off your calendars for October 10th through 12th for this year’s 110th TRSA annual conference. Yes. That’s right. You, me, and a few hundred of our linen uniform and facility services professionals are getting together in Naples, Florida for 3 amazing days. Now, sure, you’ll have the opportunity to connect and network with the industry’s biggest and brightest people.

 

And of course, the event will be packed with industry insight and new leadership possibilities that that are tailored and designed to help transform your business. Oh. Oh. And you you bet. There will be an opportunity to celebrate the year’s award winning achievements.

 

And because you’re in Naples, you’ll have the chance to experience the wonderful sun and sand that Naples, Florida has to offer. But here’s something you haven’t had the opportunity to experience since 1913. Yep. I just got off the phone with Joe Ricci and he’s put together a fantastic lineup for this year’s event. First of all, NBA legend Walter Bond will be kicking things off on October 11th in a session you are not going to want to miss.

 

And, yes, for the first time in a 110 years, I’ll be joining the TRSA annual conference. Yes. That’s right. We are going to dive deep into the cube of creativity. I am going to break down the 4 simple constraints you can add to any project or initiative to come up with better, more creative ideas, faster ideas that have the potential to transform not just your business, but the entire industry.

 

So book your flights, reserve your room, and I will see you October 10th through 12th for this year’s 110th t r s a annual conference in Naples, Florida. It is time to start thinking inside the box. I’ll see you there. Now back to the episode. We looked at our work schedules, and we made some shifts and changes there as well.

 

And then we looked at recent evaluations. One of the things that we employed starting about 2 years ago, was not just year end evaluations, but also midyear reviews. We also modified that from a paper based system, to a digital system. The, the spot audits that we had conducted back in 2020 showed a result, that we could only verify that about 50% of our performance evaluations were actually being conducted, transferred onto the document that we were using, at the time, and then made its way into that employee’s file. So as we move to a digital platform, now those evaluations could be performed online.

 

Those conversations, those performance, conversations, whether midyear or year end, proved to be really valuable, for a couple of reasons. Number 1, we could actually prove that they happen. And I’m happy to report, that our year end, excuse me, that our year end reviews, that we just conducted in December January, excuse me, performed at a, 97% completion rate. So while we’re happy with that, we really wanna aim for a 100% completion rate. We have midyear reviews coming up in about 2 months, and so that will remain our target.

 

But, we nearly doubled, what we found, just 2 years previously. But those, but those were those were important not just because, we wanted the evaluations to happen, but because we wanted the conversations to happen. What we found was that there was too much of a gap between staff members and their managers, and so we employed this, and then we measured that. And like I said, we actually doubled our performance in that area. The stay interviews, that we conducted with every employee gave us a tremendous amount of data, and it really proved that those pillars were the right ones.

 

And those are the ones that, that really carried us, through the last 2 to 3 years. So we also wanted to know, who are doing some things out there that have resulted in, some really strong retention. And what we found were some common themes or some common programs, or as simple as show gratitude. And while that may be nebulous to say, okay, tell me what show gratitude means. These companies understand what that means, and they’ve developed and they’ve developed programs around those, internal promotions, and actually promoting the promotions.

 

So they’re really public about those promotions. Whenever somebody, raises up to a new level, to a new role, those are great stories. Those are stories that they wanna tell internally because that really incentivizes folks to think differently about where they fit in their job family or on their job ladder, to say, what can we be doing as an organization to keep them here, to really show them promise, that if they develop themselves internally, and we certainly wanna make that investment as well, and that’s on this slide, they can grow themselves to that next level, and be a future leader. They also provide great access to leadership, not just to their direct manager, and that’s really where this starts. But many of these organizations have strong communications around their commitment, to open door policies at all levels, up to the president, CEO.

 

We we talked previously, about feedback and why that’s important. That’s something that these companies use as well. And so, those are some of the low cost or, no cost ideas, but these are the things that work. And when I first, looked at this, I said, but wait a minute. Prudential overall supply is not necessarily in the same category.

 

Maybe we don’t have the same financial resources that we can invest. Our staff looks different than theirs. But when you think about it, there are there are names on this slide where they have folks that are working in housekeeping and in production and in maintenance and engineering. And so, certainly, they face some of the same challenges that we do here, and so we’ve taken some of the learnings from some of these great companies. So in summary, when we when we think about retention, it really kinda came down to 5 areas for us.

 

Number 1 is, how should companies define or how should you get started, to understand just just how bad things are? And I don’t think that Prudential overall supply was necessarily sticking our heads in the sand, but, until we really saw the turnover problems that were being created within our operation, We just didn’t necessarily know how bad things were. And like I said before, we invested in a great data tool. But before that, we just had spreadsheets. Regardless, whether you’re using spreadsheets, whether you’ve invested in some kind of a data tool, just be honest with yourself.

 

I think that management and leadership, while they may not have access to those same tools, while they might not have the same, bandwidth or time to dedicate to this, I think that in our reporting, we have an obligation to be honest with leadership and to use that data and then to use that data consistently quarter to quarter, year after year so that we have those benchmarks and we can see exactly what progress we’re making. And sometimes the trend line moves downward, and, that might be unfortunate, but that’s okay, because we know that we have access to the data, and we can probably understand why it’s trending downward. And then we can make, changes, from from there. Secondly, we need to understand and research what are best practices out there. We don’t pretend to be retention experts here at Prudential Overall Supply.

 

We engage with competitors. I’ve had I’ve had amazing conversations with, with some of our competitors, to really kind of, understand and learn and study what they’re doing, and pick up great ideas. And if I haven’t had those conversations directly, some of our some of our leaders have, and they’ve brought those ideas back to us, so that we can figure out, how can we bake those into our over, excuse me, into our, retention plan. We we talked about accountability. That’s something that we found, really mattered.

 

Who needs to own those retention numbers, and how do they do it in a way that’s actually healthy? One of the things that we discovered when we when we first, introduced accountability was that some of our locations held on, excuse me, held on to employees that they probably shouldn’t have. But they said, but wait a minute. You’re producing this scorecard, and you’re showing the scorecard to the organization, and we’ve been at the bottom of that scorecard for the last two reporting cycles. We don’t wanna be there anymore.

 

And so one way that we’ve discovered, to stay off of that list or at least the lower part of that list is, that, we’ll simply hold on to folks, because we can, manipulate the scorecard. And, we have HR business partners and the HR business partners went out to those locations and and they said, no, that’s not the idea here. The idea here isn’t that you should hold on to bad talent, but that you should employ some of these other strategies that we’ve developed, so that we can actually bring in new talent, hopefully, better talent. We can train them. We can develop them.

 

And by the way, we don’t want anybody to fail. And so those folks that aren’t performing today, how can we coach them, develop them, and guide them so that they can actually not only be retained, but we can turn them into the stars that we would hope that they would be. We ask for investment. We didn’t break the bank, but, what we would recommend is that leadership get involved and at least make some commitment, not just in terms of dollars, but also in terms of time, in terms of priority. There are a lot of, big challenges, that our leadership faces every day.

 

And so we wanted to make sure that this not only made it on the list, but made it toward the top of the list. And so we were provided reasonable resources, and we would recommend that organization facing some of these similar challenges, might make the same request. And then lastly, it has to stay in front of everyone. Retention is too important to let it just drift off, and we’ve seen a lot of those initiatives. A lot of those projects just kinda drift away, but retention is one of those where we continue to, report.

 

We’ll have our next gen excuse me. We’ll have our next general managers meeting next month, and that’s gonna, excuse me, that’ll be, one of the top, HR updates, to really show our progress. And now we actually do have progress to report that at at the outset of when we started our projects, we did not meet those targets by the end of 2022, but we are meeting those targets today. And so while it probably lags by about, 1 quarter, maybe 2 quarters, we are actually meeting those those goals and objectives today. It took us longer, than we probably, thought that it would, but the results are there, and the results show.

 

I think that we can learn from other organizations, and I think that we can learn from each other. If you have any comments on today’s show or suggestions for future episodes, send an email to podcasts attrsa.org. That’s podcasts attrsa.org. Thanks again for tuning in. And if you liked what you heard on today’s show, please subscribe, rate, and review us on Apple Itunes, Google Podcasts, and Stitcher.

 

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