Distribution centers are concerned with decreased production and increased absenteeism in their organizations because of talent shortages, but why are these struggles so prevalent? And are there tangible ways you can improve warehouse productivity without having to wait for the pendulum of candidate supplies to swing back in your favor again?
The Need for Incentives
In the past, people would get up and go to work, content with their routine, but not so anymore – people want more. Individuals are continually asking the question, “Why am I going to work? What am I providing to the workforce? And what are they providing me?” There’s been a complete shift in the workforce mentality.
Why all the questions? What’s bubbling to the surface is that employees are looking for incentives that connect with their own intrinsic motivations. In other words, they are searching for jobs that will give them the most bang for their career buck.
Especially in the last year and a half, with wages increasing and job slots opening across the board, individuals want positions that feel tailor-made to them. Whether they're searching for the right work-life balance, growth opportunities, or better salaries, they will explore their options until they find the perfect combination. And if they aren’t convinced the role is right for them, they can simply walk out of one job and find another one tomorrow – most likely with a pay increase too. That's why so many companies have incorporated incentives.
The Danger of Wrong Incentives
Some companies have incorporated sign-on bonuses to entice job seekers. In this scenario, workers who stay in their role for a certain number of days receive a monetary bonus; however, this is not an ideal long-term solution. Some people will undoubtedly take advantage of that system – going from job to job to obtain the sign-on bonus and then leave for a new position.
Companies don’t need more sign-on bonuses – they need to build better relationships. Since people are asking questions that drive at the motivation behind work, how leaders respond plays a significant role in the company’s future workforce. Better schedules, more money, greater power, advanced titles (and more) are all deep motivators. But if leaders aren’t feeding these motivations and if a shift doesn’t take place, we will continue to face the struggles we have today.
A Work Model that Has Incentives Built in from Day One
Industrial Athletes (IAs) are what we call our associates at Eclipse, the people who are driving our clients’ businesses forward. They’re the ones on the docks, on the production floors, on the assembly lines and more. However, they aren’t paid like the traditional hourly worker. They work as a unit, and as Brandon Skipper, one of our Directors of Operations says frequently, “For longevity, team merit is what lasts.”
With a team-based pay model, the entire working framework increases a teamwork mentality. Everyone is on the same team on the same playing field, receiving equal pay for each job. IAs bare the load together and are all making money in tandem.
This model of team pay also aids in decreasing absenteeism. Our Industrial Athletes get paid on the day they work, and each day could be different. For example, as they unload shipments and products, the pay varies according to the client; this reduces needless call offs since increased compensation is always a prospect. This inherently motivates them to come to work each day. And again, if they come ready to work, knowing they can get a job done well, these workers can most likely complete the task in less than eight hours since they are not tied to a clock.
This one-for-all-all-for-one mentality pushes employees to do their best. They meet the demands of the business while their colleagues (not managers) push each other to do better – they encourage one another to pull their weight.
From an executive level, leaders are often very pleased with the results. Skipper mentions that once a distribution center decides to partner with Eclipse and a team-based pay model, over 90% are content and satisfied with the results. “For employers, Eclipse provides a fixed cost, a per project cost. It’s our job to manage the labor. We take a stronger look at productivity through the lens of a team. In our model – IAs look to how they can help each other. It’s not me, but we.”
The Central Role of Leadership
However, one of the biggest contributors to better productivity isn’t just the pay model: again, it comes back to leadership. Proper leadership feeds the right motivations. As Michel Plasse, one of our Directors of Operations, says, “People often think of a boss as someone who tells you what to do. But a leader motivates you in the day-in-day-out routine.” A team reflects the example of their leader.
“We provide a motivated workforce, people who want to be at their jobs. They work each day as safely and quickly as possible. And if you have a motivated workforce, you reduce absenteeism and increase productivity through your team environment.”
When leaders spend the extra time to invest in their team, from constructing professional development programs to grabbing donuts for Friday morning, they assemble supportive conditions that help people value their work, strengthening daily motivation. And when team environment and leadership align, we create an unbeatable workforce.
Looking at how you can incorporate a team-based pay environment to increase productivity? Take a look at our Eclipse IA model and connect with our team today!
This is part four in a seven-part series about what it means to be an Industrial Athlete at Eclipse IA. Directors of Operations Brandon Skipper and Michel Plasse contributed their subject matter expertise in the light industrial industry for this article. You can read all of the posts in the series here.