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Quality Jobs

The multi-faceted value creation initiative

Case Studies: Quality Jobs in action

Providing employees with living wages and making a high investment in them over the long-term can potentially lead to operational superiority as well as higher sales and profits for many companies.

A quality jobs operational program dispels the myth that high wages always lead to lower investment returns.

Case study #1:

A Hospital linen services provider prioritizes quality jobs to turn company around

A leading regional provider of outsourced linen management services for hospitals and nursing homes as well as uniform rental and laundry services suffered from significant operational inefficiencies that resulted in poor job quality and decreased profitability. 

The problem:

Stuck in a vicious cycle

Insufficient plant leadership and HR oversight resulted in poor shift coordination, which led to employee dissatisfaction as well as excessive overtime. Employee disengagement coupled with low wages led to an unsustainable turnover rate.

The solution:

Investing in a virtuous cycle

Recognizing the disruption high levels of disengagement and turnover were having on their business the Board committed to improving retention and hired an expert to lead quality jobs initiatives. The company took steps to re-price new business to profitably accommodate competitive wages. They also made investments in onboarding, training, human capital systems & reporting. This all led to improved shift efficiency and added accountable plant leadership. As a result, the company reduced employee turnover from 149% to 83%.

Commitment to workforce investments and providing employees with living wages has proven to lead to operational and financial improvements.

With investments to onboarding, training, human capital systems and reporting. One company reduced employee turnover from 149% to 83%.

Source: Schroders Adveq. 

Case Study #2:

Boxing out the competition

People shop at big box stores for reasonable quality at a compelling value. One Box store (A) knows what their customers want and they consistently deliver it. By eliminating and removing wasteful activities, it has allowed for continuous improvement and has recently been named the #1 employer for compensation and benefits in the US by Indeed.com, ahead of the likes of other well-known Fortune 100 companies.

But what about the economics of investing in employees?

Although Box Store A has a cost per employee that is significantly higher than many of their peers (Box Store B), their revenue per employee far exceeds most of them, as has the returns of the company’s share price.  

Box Store A realized that by following the Quality Jobs framework, investing in employees creates a virtuous cycle, and that in turn makes good business sense.

Schroders

Box Store A price outperformance relative to competitor Box Store B

Source: Gallup, 2021

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