HR Professionals Add Strategic Approach to Workforce Challenges
Labor challenges are not new to the cold storage industry, but the current economy with record low unemployment rates exacerbates the challenge as temperature-controlled warehouse leaders look for quality employees to fill positions.
The Case for Dedication
Although a majority of cold storage companies do not currently have a formal, dedicated human resources staff comprised of HR professionals, the trend to hire HR professionals to oversee recruitment, retention, and training is growing, says Jeremy Lurey, Ph.D., President and CEO of Delta Plus Consulting and the GCCA’s Talent Management Service Partner. “I would guess that only 10 to 20 percent of cold storage companies have HR staff that focus only on HR responsibilities exclusively, but more companies are evaluating the move,” he says. “Even if these companies continue to use temp agencies and outsourced recruitment firms, tasks such as onboarding, training, staff development, and employee retention are best handled by HR professionals.” When Lori Cogit, Vice President of Human Resources at RLS Logistics, joined the company three years ago, there had been an HR presence onsite for 10 years. The CEO of RLS wanted to expand the impact of HR to position the company for continued growth and success, she says. “The Vice President of HR position was created to position HR as a strategic partner rather than a support organization,” she explains. “HR has a ‘seat at the grownup table’ at RLS.” Cogit’s previous experience that included a refrigerated cold storage and transportation company as well as a food manufacturing company made the transition to RLS an easy one. Experience in cold storage, however, is not necessary to be an effective HR professional. “I came from the hospitality industry where I focused on the training and development side of HR for companies that included Ritz Carlton and Hilton International and from healthcare where I worked with a large nursing home company,” says Karen Whiddon, Director of Human Resources for NOCS Corporate, which has four locations and over 300 employees. Although her background didn’t include cold storage, she understood what it takes to staff, train, and retain blue-collar employees who work day and night shifts – like cold storage employees. “I was the first HR professional hired for NOCS,” explains Whiddon. “Human resource activities had been split up between warehouse managers recruiting and hiring people and accounting staff handling payroll and benefits – all as a part of their overall job,” she says. Along with a second person who handles HR administration tasks, Whiddon is focused on building programs to train and engage employees.
“Retention of good employees, especially those with leadership potential, is an area of focus for us because we anticipate a large group of long-time employees will be retiring in the next two to five years,” says Whiddon. “While we don’t have a lot of different levels for promoting people, we have created a Next Gen University and identified a group of employees with leadership potential to take the program as a way to enrich their current position.” The University allows employees to learn about the business, customer service, management, safety, and other issues related to the company. The second phase of the program is spent applying new knowledge to their positions and sharing those lessons with others. “It’s important that we teach people to share their knowledge so that the knowledge stays with the company regardless of promotion, retirement or leaving the company,” explains Whiddon. “By showing appreciation of their efforts by investing in their development, we are more likely to retain good people.” Other retention strategies implemented in the past three years include a streamlined, consistent interview process that includes recorded phone interviews to ensure that candidates are fairly assessed, says Whiddon. By expanding their recruitment efforts to include employee referrals, temp agencies, social media, online job boards and warehouse manager efforts, the pool of talent to consider has expanded, which means managers can be a bit pickier about who they hire, she adds. “We have also done a better job during the 90 day probationary period of identifying candidates who are not meeting the needs of the warehouse,” says Whiddon. “In my first two years, this meant that our turnover rates did not drop because we were letting people go while still building our recruitment talent pool, but in my third year, our turnover rate dropped between 8 and 10 percent because we’re able to hire the right people initially.” Strategic thinking about the causes of turnover led to the practice of checking in with new employees on a regular basis, says Cogit. Her HR team of four contact new employees at the 30-day, 90-day and one year point of employment for a casual conversation about how things are going. “The conversation can be face-to-face or via telephone and they ask if the employee has received the training they need, about the relationship with the manager, and if there is any information they need,” explains Cogit. “This is a time commitment, but it is during these conversations that we learn that a line worker wants to become a forklift operator.” The HR staff was able to get the employee’s supervisor onboard with a plan to allow the employee to work toward certification as a forklift operator. “Employees feel safe expressing their goals to us when they are concerned that supervisors will misunderstand the desire for another job as a negative comment on their work.”
Todd Drass, Director of Talent Management and Culture at Lineage Logistics, was hired in 2016. “Lineage was a conglomeration of aquired companies at that time, many of which handled their own HR activities just as they had always done,” he explains. “In 2016, the company really became focused on integrating our culture and upgrading our talent throughout the company, which led to my hiring as well as other HR professionals.” Susan Williams, Director of Talent Acquisition at Lineage Logistics, points out that she and Drass are good examples of their own philosophy of whom to hire for HR positions. Williams came to Lineage with experience in the IT staffing industry but brought a wealth of knowledge about strategic planning in relation to HR and vendor relations. Drass came to his position after handling a broad range of HR responsibilities in the auto industry. “When we hire for HR and other positions at Lineage, we look for the right fit with our culture – people who can work as a partner with many different areas of the company,” says Williams. She also points out that in addition to hiring the right people, it also takes a good onboarding program to improve retention. “In addition to the traditional five-day onboarding training, we’ve created a consistent program throughout the company that allows new employees time to learn the job by staging their production targets so they can succeed as they learn, ensuring they obtain the right MHE (Material Handling Equipment) certifications and providing mentors to guide them,” says Drass. While the larger sites have HR teams in place to provide training on safety, company policies, and other items, Drass and his team have created a two-day program that smaller sites can use to be sure that employees throughout the company receive the same training. The combination of hiring right and onboarding consistently has led to a significant reduction in turnover across Lineage Logistics’ largest warehouses, he adds. Cold storage companies don’t have to be large to benefit from professional HR experts, points out Lurey. “Evaluate the need by considering who is doing the function now as part of their broader responsibilities and what opportunity costs are lost by taking the person away from their primary duties,” he says. “If there are more than 50 employees, a full-time HR professional is justified. If there are more than 100 employees, a seasoned HR professional at vice president or director level is likely needed to provide more strategic guidance.” Companies with fewer than 50 employees have options to benefit from the expertise of an HR professional, says Lurey. “A parttime HR manager or an HR consultant on a retainer basis who may onsite one day a week, for example, or on call as needed, can help with HR issues,” he says. No matter which route is taken, Lurey does recommend tapping into an HR professional’s strategic expertise. He explains, “Engaging an HR professional to help develop strategic solutions to today’s workforce issues leads to a higher performing company.”