Report on Employee Engagement in Power Manufacturing Company (PMC)

Introduction

The Power Manufacturing Company (PMC) was founded in 1960 by two brothers named Ray Fallow and Ted. The company specializes in the production of a wide range of power tools and equipment. The Power Manufacturing Company product line includes but is not limited to power drills, trimmers, lawnmowers, and saws, all of which are available in cordless and corded versions.

The PMC company has had tremendous success over the past years, and they’ve managed to keep it family-owned. Four facilities are operated by the company in Utah, Kentucky, Minnesota, and Ohio. Major distribution centers are also located in Kansas and Indiana. Despite the family-owned business has grown significantly over the years, two of its original manufacturing units are currently experiencing problems. Lima, Ohio, and Bowling Green, Kentucky are the locations of these plants.

The plant in Lima employs approximately 600 non-union workers and has historically had a stable workforce. The workforce demographics have shifted substantially in the previous five years, with turnover increasing from the customary 3 to 4% to upwards of 15% and continuing to rise.

According to pay surveys, Lima’s hourly income is competitive in the area. Bowling Green, which employs 500 non-union employees and has a turnover rate of 18 percent, is experiencing similar issues.

Compensation and Benefits

A potential employee’s compensation and benefits (C&B) is one of the most significant factors to evaluate. However, the benefits come along with the remuneration that is more essential than the monetary reward. When it comes to recruiting and retaining great personnel, C&B is the decisive factor. According to PMC, hourly workers should be paid competitively in each region. It may, nevertheless, be competitive in the area, but the benefits that come with it may not have been as competitive as the firm believes. Voluntary employees often find compensation as the top reason to partake in the work sector in the companies, thus the large turnover ( Dewar, 2019). Benefits and compensation, therefore, remain key and foremost in the high rate of employee turnover rates.

The turnover rate can cost a company up to over 33% of a laborer’s base salary. This has the potential to have a direct impact on operating costs and overall productivity. This could result in the corporation losing even more money. “In addition to the payment, backfilling roles necessitates a significant amount of effort. Mostly in United States, there are over 7 million job opportunities, but only 6.5 million individuals are jobless, resulting in a substantial knowledge and skill in the marketplace” (Dewar, 2019). When money is squandered on finding another applicant to fill those vacated positions, it may be devastating to a business.

Additionally, several other factors remain impactful in the turnover rates following the C&B. below is the list of impacts that further highlight the turnover rate aspect of PMC company.

Gender and Ethnicity: Underrepresented ethnicities have lower earnings than their counterparts (Dewar, 2019). Women, for instance, make 83 percent more than men, while Black employees earn 75 percent more than their White counterparts.

Employee Tenure: Since all industries are evolving, it is usual to see newer employees earning more than those who have been with the company for longer. This seems to be due to improved skills or knowledge and rising demand for top talent.

Team: Comparing the wage band distribution of a department or unit with other groups and around the company if it has a high turnover rate. Check to see if any pay bands ought to be modified.

Therefore, in this sector, various concerns might be the cause and impact of employee turnover. I would strongly recommend doing a study to obtain input from employees to understand better if this is an underlying problem and how to tackle the concerns to reduce the effects of employee retention.

Work environment and conditions.

A workplace environment is made up of a variety of elements. From business culture to management styles to HR regulations, there’s a lot to consider. “Workplace surroundings have a significant impact on employee happiness, which has a direct impact on employee turnover rates,” says the author (Ingram, N.D.). Growth opportunities are now at the top of the list of these variables. Companies eager to assist employees in developing new abilities are more likely to keep them on board. No one wants to be stuck in a job that does not offer room for advancement. The best course of action is to give a career plan for employees who intend to remain with the business and assist them in their progress—having an option for workers who aren’t sure if they want to join this career path. Providing these changes can help you limit employee turnover by encouraging employees to stay with you longer in order to fulfill their personal and professional goals.

Supervisory leadership

The importance of leadership at all levels cannot be overstated. Each group of leadership in a company has an impact on lower-level employees. Employees expect leaders to follow through with the company’s beliefs and what it takes to be a leader; if they believe they are not being led and their concerns are not handled, they will eventually quit. Leaders with technical and soft skills are needed in organizations and can rule without bias, based on potential and work ethic. High turnover can indicate various issues related to leadership, such as internal strife, poor leadership, and a lack of leadership training. It’s also possible that the management made bad recruitment selections when it came to selecting individuals for senior positions,” says the author (Mayhew). Evaluations and hearing from the employees leaving are the best ways to figure out where all the leadership issue is coming from. This will assist in identifying the source of the disconnect, whether it’s inside a department or across the board, and begin to address the problem.

Plan Management

Knowledge-management systems are one of the most important strategies for a company since it includes programs like learning and organizational development, performance management, recognition, and succession planning, all of which are aimed to provide people the tools they need to succeed in their professions. This could be a contributing factor in employee turnover. Employees may believe that the company is failing to meet their requirements and expectations. According to Tarallo (2019), by concentrating more on the needs and expectations of employees, managers can improve their employee retention and efforts and retain more personnel. Onboarding may easily change this by including who the firm is and what it advocates for from the start. Employees can learn the company’s objectives and how they will help them achieve them by emphasizing what makes it distinctive.

Another effect that can be accomplished is educating the employee about the contribution, Connection, and Culture. The plan must continue after onboarding and throughout the employee’s employment with the organization. Employees’ interactions with peers, executives, and managers shape the culture of an organization. Maintaining a great employee experience is a proven retention strategy (Tarallo, 2019).

Relationships between peers. 

Only about a third of companies without coworkers are extremely engaged. This is in sharp contrast to the 69 percent of employees who have many coworkers with whom they maintain a high level of engagement (Dickson, 2019). In every element of a company, peer relationships are essential. Peer ties encourage employees to stay with the organization, lowering turnover. Social connections assist at work when things aren’t going as well as an employee would want. According to the survey, sixty-one percent of employees said their coworkers’ support was crucial in helping them overcome life’s challenges (Dickson, 2019).Even though it might be impossible to bring friendships in the office, an environment that promotes collaboration, respect, and acknowledgment can be fostered.

Job training

Training that aims to boost worker commitment, participation and assist employees in understanding the company can improve an employee’s overall commitment towards the organization and, as a result, minimize the likelihood of turnover (Pervaiz, 2012). When it comes to onboarding new hires, job training is always a challenge. Nevertheless, this should not be a tool used solely at the start of a new employee’s job or career. And though the investment appears to be substantial and expensive to an employer, it can be well worth it if an employee is kept.

Employees can progress while working in the same company that has invested in them by participating in training and workshops. Training must be viewed as an input that yields a higher return from an employee (Pervaiz, 2012). Employees feel more confident about their positions and where their careers are directed when a firm invests in them.

Recommendation

There is no one-size-fits-all solution for lowering staff turnover to a manageable level. Making an effort to learn the expectations of the employees, on the other hand, is a start on the right path. What do employees want from their employers, and what do they expect from them? Unfortunately, with unemployment at historic lows, people have no qualms about changing jobs if their present company fails to meet their requirements.

Improving the company’s hiring practices is one of the finest ways to boost overall retention rates. Employers should seek out people who possess the requisite skills and fit in well with the organization. Employers must create a strong employment brand that reflects the corporate culture and seek people that “fit” in well.

Developing an effective onboarding process and linking up employee engagement is key and crucial for companies to consider setting up an effective onboarding system that should be implemented to create specialized software that effectively performs an onboarding process.

Another way to effectively engage the workers is by offering them a healthy and balanced work-life environment. However, not all firms can offer flexible work hours, and they may make paid leave and vacation time more manageable for their employees. Consider implementing simple time and attendance software that allows employees to seek paid time off and managers to approve it via an internet interface.

Conclusion

The Power Manufacturing Company (PMC) seeks and aims for commitment, and the company expects it. As this document demonstrates, many factors might contribute to the increase in employees’ turnover over the last five years. Suppose the organization solves all of the issues in the report, as well as each proposal. In that case, they will experience a significant reduction in staff turnover and higher levels of employee engagement.

References

Pervaiz, H. (2012, February 29). Engagement Matters: The Impact of Training on Employee Turnover.Retrievedfrom https://www.hrexchangenetwork.com/learning/columns/engage ment- matters-the- impact-oftraining-on-emplo

Tarallo, M. (2019, August 16). How to Reduce Employee Turnover Through Robust Retention Strategies. Retrieved from https://www.shrm.org/resourcesandtools/hr- topics/talentacquisition/pages/how-to-reduce-employee-turnover-through-robust- retention-strategies.aspx

Dewar, J. (n.d.) (2020). Is Compensation to Blame for Your High Employee Turnover Rate? Retrieved May 3, 2020, from https://www.compa.as/blog/compensation-high-employee- turnover-rate