TSI Scores With Workforce Initiatives

with Work Force
Employee selection and development are
sometimes an afterthought to other needs,
such as the implementation of new equipment
and technology. But, as TSI has discover ed,
the key to managing successful growth can
begin with innovative human r esource
initiatives.
by Janet Fox, Special to Bobbin
“As we started to implement the new technology, we wanted
to assess and develop the skills of our current associates and
make sure that new hires had the necessary
skills. A secondary focus was on turnover.
We needed to focus on hiring and retention.”
CORY PUGH
Director of Organizational Development/Human Resources
Tropical Sportswear Int’l. Corp. (TSI)
108 Bobbin, September 2000 ●
bobbin.com
hen Tropical Sportswear Int’l.
Corp. (TSI) embarked on a major human resources testing and
education initiative two years ago,
the company was struggling with
the loss of productivity caused by
employee turnover and the coinciding costs of hiring and training new personnel.
With increasing levels of technology and automation being implemented across its Tampa, FLbased operations, the firm realized
it needed a new approach to hiring and retaining its work force,
which includes more than 450
hourly employees in the cutting
room and distribution center.
Established in 1927 as Tropical Garment Co., the company
came under new management in
1989, and since that time has enjoyed aggressive sales growth under company branded lines Savane®, Farah®, Flyers™, The Original
Khaki Co.™, Two Pepper® and Bay
to Bay®, and with its licensed brands,
such as Bill Blass®, John Henry®
and Van Heusen®. (See “TSI Built
To Win,” Bobbin, January 1999.)
➫
Better Methods
As TSI has expanded to become a powerhouse in both
branded and private label men’s and women’s casual and
dress sportswear, it has faced many of the significant work
culture changes and challenges that accompany rapid
growth. For instance, the introduction of new technology (such as radio-frequency scanners in the distribution
area) signaled a need for dramatically increased skill sets
among the firm’s hourly associates. The challenge before
TSI was to implement human resource initiatives that would
help employees keep up with the technological advances
while improving their skills. At the same time, TSI needed to address the issue of work force turnover.
Assessing the Situation
“With our associates we had two goals,” notes Cory
Pugh, director of organizational development/human
resources at TSI. “As we started to implement the new technology, we wanted to assess and develop the skills of our
current associates and make sure that new hires had the
necessary skills. A secondary focus was on turnover. We
needed to focus on hiring and retention.”
After interviewing several prospective consulting
partners, TSI chose The Context Group, a soft goodsfocused consulting firm whose apparel clients include Polo
Ralph Lauren, VF Corp., Sara Lee, Jockey International,
Brooks Brothers, Guess? and Pendleton.
As it looked to address TSI’s specific challenges, The
Context Group first conducted a job analysis to understand what skills, abilities and performance characteristics
among associates were critical to high performance in
the firm’s distribution center and cutting room.
Warren Bobrow, Ph.D., and a principal with The
Context Group, led the job analysis project with TSI’s Pugh.
They found that TSI had an unusually high degree of technology in use, particularly in the cutting room. Related
to this, the skills assessment revealed that as computers
played an increasingly important role in cutting room jobs,
the most critical attributes among associates became an
eye for quality and the ability to work as a team. Before the
introduction of cutting technology, the most critical at-
“Math skills, the ability to read series of
numbers and letters accurately and
willingness to work
independently continue
to be the key success factors
[in the distribution center].”
WARREN BOBROW
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Principal
The Context Group
Testing for Specific Skills,
Strengths
Justwin
Next, The Context Group tested all
hourly associates in basic reading and
math skills and personality characteristics. Cutting room employees were also tested in their ability to perform visual quality inspections. Distribution
personnel were tested for the ability to
quickly identify number series, which
are used to code boxes in the distribution area. The test results were correlated with both productivity and quality, and revealed that associates who scored
higher for certain skills were those who
were producing more and higher
quality work.
The test results were used to determine
cut-off scores for new recruits. Testing of
job applicants made it possible to identify which candidates possessed the basic
skills, and also to determine where they
would best fit into the organization. Teamwork skills and values, for example, are
essential for cutting room employees
because they work in an environment
in which much of the work is carried out
by teams. These skills are not as important in the distribution area, where associates work independently.
Offering Free Education
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tributes among cutting room personnel
were spatial relationship skills.
In the distribution center, on the other hand, it was found that the introduction of new technology did not substantially change the skills and personal
characteristics required to perform the
jobs well. “Math skills, the ability to read
series of numbers and letters accurately
and willingness to work independently
112 Bobbin, September 2000
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continue to be the key success factors,”
notes Bobrow.
The assessment also included an evaluation of all associates’ reading ability —
a skill that has become more important
at TSI as new procedures have been introduced, requiring employees to read appropriate training materials in order to
implement them.
Employees who needed to improve skills
or to upgrade their skills, for instance to
prepare to use hand-held computers for
scanning stock, were all offered training at
Tropical University, TSI’s free internal learning center. Ongoing course offerings at
Tropical University include English, Spanish, math, basic computer skills and management and communication skills. The
courses, offered at many hours throughout the day, are also open to families of
employees at no charge. And because some
50 percent of employees speak Spanish
as their primary language, courses are offered in both Spanish and English, and
all documentation of processes is presented
in both languages.
“We graduate 130 or 140 people every
quarter at Tropical University,” Pugh opines.
“Education and training have proved to be
a big benefit for our employees and their
families. We also offer 100 percent tuition
reimbursement for outside education,
whether it’s for a GED or a doctorate.”
➫
FIGURE 1
Declining Turnover at TSI
Turnover Percentage in Relation to Human Resource Testing Initiative
Reimers
80%
70%
60%
50%
40%
30%
20%
10%
0%
6 Months
Before
Testing
When
Testing
Started
6 Months
After
Testing
12 Months
After
Testing
Source: The Context Group and Tropical Sportswear Int’l. Corp. (TSI)
Higher Retention Pays Off
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114 Bobbin, September 2000
The results of TSI’s highly focused
testing and education programs have been
impressive: Within six months of the initial testing, turnover was reduced by 38
percent, from 65 percent to 40 percent,
and that rate continues to decline (see
Figure 1).
For instance, TSI has discovered that
for employees who enroll in a course at
Tropical University, the retention rate is
95 percent. This high level of retention
has produced a direct impact on TSI’s
bottom line.
Consider the following scenario, which
could apply to any apparel company:
■ Typically, employee turnover costs a
company $5,000 per person who needs
to be replaced;
■ If a company has 400 employees, a 30
percent annual turnover rate could potentially cost the firm $600,000 per
year;
■ Assuming it costs $25,000 to take steps
(consulting, testing, training, etc.) to
reduce turnover to 20 percent, the cost
of turnover could be reduced to $400,000
per year, representing savings of $175,000.
Obviously, the numbers can vary from
company to company, but this illustrates
the costs associated with employee turnover
and the amount of savings any company
can realize by reducing it.
In addition to free education, TSI has
implemented other human resource ini-
tiatives, such as offering subsidized daycare, holding daily and weekly staff meetings to communicate the goals and status of the company, providing cross-training
to help employees understand where their
contribution fits into the big picture and
recognizing and rewarding employees
for ideas that save money and boost
productivity.
Not every company will be able to afford or execute all of the initiatives undertaken by TSI. However, the critical
lesson to be learned is that employee
selection and development go together.
TSI made a conscious decision to hire
people who had the skills to do the current jobs, but also to prepare them for
the future. As you can see from this
case study, implementing an effective human resource development program can
have far-reaching benefits throughout
your organization that you cannot afford
to ignore.
Janet Fox specializes in writing about
consulting and training solutions.
Editor’s Note: For more information
about TSI’s testing and education initiatives, TSI director of organizational
development/human resources Cory
Pugh may be reached at e-mail:
cpugh@tsionline.com and The Context
Group’s Warren Bobrow may be
reached at e-mail: warrenb@contextgroup.com.