Distribution centers struggle to fill open positions now more than ever. You feel the weight of this struggle as you advertise open positions on job boards, social media, billboards, and anywhere you can grab a candidate’s attention. However, these avenues to find traditional hires or even temporary workers are falling further and further behind with today’s demand. What are leaders and managers in the supply chain sector to do?
It’s time for a different solution - it’s time to hire Industrial Athletes.
The Trouble with the Traditional Model
First, let's talk about the problem that's been hindering recruitment: the traditional workforce model. Often times traditional workers in a commodity model are paid on an hourly rate but don’t appear to be overly engaged or invested in their position; they aren’t staying with distribution centers long. The supply chain industry (with the traditional pay model) has a turnover rate of 400 percent. It’s no wonder that 60 percent of warehouses report recruitment as their top challenge. What's the reason behind these statistics?
Simply bringing more people into your building on an hourly wage doesn’t reverse turnover. Traditional workers get paid the same regardless of how much they produce. In the current market, hourly pay doesn’t offer the right incentives for the higher production rates that distribution centers need right now.
However, Industrial Athletes provide a solution that fits the demands of today's market.
Industrial Athletes (IAs) – the Solution
Industrial Athletes are members of our team working together to achieve a certain goal - trucks unloaded/loaded, packages packed, etc. They are the employees who drive the supply chain of today and deliver on our clients’ demands – they are the real MVPs. Instead of an hourly wage, Industrial Athletes are paid for performance, and this is a real game changer.
Productivity Pay, also known as Team-Based Pay (TBP) or the Pool Pay Model, is a compensation system that rewards Industrial Athletes with the same rate of pay. The more they work well with their fellow workers, the more they can accomplish together (and sometimes in a fraction of the time).
Their efforts improve both productivity and cost management as they go beyond completing the bare minimum. How exactly do they provide such a valuable ROI for a distribution center?
4 Reasons Why Industrial Athletes Are the Right Solution
1) Industrial Athletes Keep the Big Picture in Mind
As described above, the IAs focus on the final output daily. From receiving and organizing orders to filling shipments to delivering products, they want to accomplish as much as possible. Once they complete an order, they either collect their wages and go home for the day, or they can begin a new project (oftentimes employees on a TBP model gain 20% higher wages than in the typical commodity model). This mentality directly plays into the next point.
2) Industrial Athletes Value Teamwork
By emphasizing teamwork, IAs are not trying to outdo one another in their efforts. "The IAs know that the more they invest individually, the better results for them and their entire team," says Brian Richmond, President at Eclipse IA. "They know their place and understand the value of their collective efforts." Because of the team-based pay model, IAs are committed to working in the quickest, safest manner possible, which leads to on-time deliveries, reduced detention fees, and better operating costs for your business.
3) Industrial Athletes Increase Productivity & Increase Retention
It’s no surprise to anyone that the faster new hires get up to speed, the more money the entire team can earn. So, when new Industrial Athletes join the team, the veteran or varsity players quickly teach the new recruits the ropes. By emphasizing teamwork, you reduce the risk of favoritism and reward collective effort to get the job done in the quickest, safest way possible. And with this element of camaraderie infused in the culture, retention begins to increase as well.
"With client sites that have implemented the productivity pay model, we've seen turnover curb by more than 35 percent," says Richmond. "That's huge for our clients. After all, what distribution center wouldn’t want that magnitude of role reversal in their hiring statistics?"
The cost management of securing workers and diminishing the expense of constant hires affords your company new inroads of success and progress.
Team Based Pay environments have a lower turnover because workers are earning higher incomes than in an individual environment. As a whole, Industrial Athletes are often very content with their wage, and therefore create a more stable operation for any management team.
4) Industrial Athletes Promise Positive Potential
As IAs grow in their skills and team-oriented abilities, their leadership abilities take deeper roots. Successful IAs do more than fill an order; they provide reliability for the overall environment of the organization. The quality of their work and commitments to efficiency and productivity pave the way for them to become the leaders of tomorrow for your company.
These workers provide innovative ways to new levels of success for your supply chain business. So instead of sticking with the same model of hiring and struggling to fill open positions, why not give Industrial Athletes a try today?
Ready to learn more? Take a look at Eclipse’s Workforce Solutions today.
This is part three in a seven-part series highlighting our Industrial Athletes and what makes them different from typical warehouse workers. You can read all of the posts in the series here.