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STHRM Case Studies
The following STHRM case studies exemplifies the types of opportunities and challenges undertaken and the sound, value added solutions we provide.
Electric Product Manufacturer and Distributor Saves $1.35 Million
Challenge: The client is a privately held company that manufactures and distributor electric products. The challenges arose from the deteriorating economy.
Solution: STHRM was hired in the capacity of an Interim Director, Human Resources.
Accomplishments:
- Performed a comprehensive analysis of the present state of Human Resources effectiveness.
- Developed and executed a salary reduction in force (RIF)
- Assisted with guidance in preparing for labor contract negotiations and strike contingency planning.
- Completed an hourly workforce reduction in force resulted · Revised and updated the Company’s Ethics Policy.
- Developed and implemented an Office Performance Management System for both exempt and office clerical employees.
- Developed and implemented HR Scorecard to track HR metrics.
- Clerical positions were rated as exempt therefore misaligned to FLSA and re-evaluated as non-exempt.
- Successfully handled/concluded various employee relations issues.
Financial Results:
Provided client Operating Income Improvement through savings of $1,135,000.
Northeast Ohio based Client Service Company with 75 Employees Saves $102,000 in Less Than 6 Months
“STHRM accomplished a great deal of work in a little bit of time and it is worth the investment.”
Situation: Client’s Ohio Bureau of Workers’ Compensation was in penalty rating.
Solutions:
- Conducted a safety inspection
- Wrote the Premium Discount Plan (PDP+) which was approved by BWC
- Investigated new manual classification through BWC
- Brought into compliance with Ohio Drug Free Workplace
Results: In less than six months, STHRM achieved these specific and measurable results:
- Drug Free Workplace and PDP+ saved the company $18,000
- Lead in reclassification of BWC risk class reducing costs by $22,000 per year
- Initiated request for BWC audit resulting in recovery of $9,000
- Wrote PDP+ plan which was accepted by BWC
- Sourced new TPA resulting in annual cost saving of $53,000.
- Conducted quarterly safety inspections to maintain a safe work environment and maintain new lowered BWC costs
- Challenged and won an unemployment claim.
- Challenged BWC case resulting in dismissal.
Financial Results: STHRM leadership achieved net annualized savings of $204,000
Northeast Ohio Based Service Company with 75 employees Saves $29,000 in Hospitalization Insurance
Situation: Client’s health insurance was too expensive.
Solutions: Researched, interviewed and recommended new health care provider to management.
Results:
- Received 2.6% increase for hospitalization insurance for 2010.
- Additionally reduced client’s Ohio BWC frequency and severity rate of 0 for reporting period and negotiated a reimbursement of $13,786.23.
Central Ohio Service Company Saves $2.1 Million in Less Than a Year
Client: Service company based in central Ohio with 600 employees in six states and annual revenues approaching $100 million.
Situation: Client’s HR department did not adequately serve the company in a number of ways:
- Employee turnover reached 50% per year at a cost of $3,000,000.
- Workers’ Compensation rate was 40% + penalty rated due to 50 lost time accidents.
- No employment process was in place.Health insurance costs were increasing and group life insurance plans were not reviewed in years.
- No performance review program was in place.
- Compensation and wage grades and ranges were not in place.
- Minimal training for supervisors, manager, directors for legal, leadership, and soft skills development.
Solutions: STHRM was hired as an Interim Director, Human Resources and took the following steps:
- Developed new employment process protocol to include pre-employment drug screens, background checks, and reference checks.
- Developed a safety program with the company’s property and casualty insurance company to conduct safety inspections and train employees about safety.
- Reviewed health and medical insurance, group life, short term disability, and long term disability policies.
- Outsourced health care, life insurance administration, and new employee orientation to a third-party benefit administration department.
- Developed and initiated a new employee performance management system, which instituted quarterly performance reviews and set personal management objectives for key employees.
- Initiated executive, manager, and supervisory training program on employment law, discrimination, and maintaining positive employee relations.
Results: In less than one year, STHRM achieved these specific and measurable results:
- Employee turnover was reduced by 10%, resulting in an annualized saving of $300,000.
- Ohio BWC will be credit rated at 17% effective July 1, 2008, resulting in a net savings of $138,000.
- Recruited new HR Representative, CFO, VP of Asset Management and Regional Manager with an annualized cost savings of $151,000.
- Lost-time accidents reduced by 50% in 2007.
- Reduced hospitalization and medical benefits, life insurance costs, and outsourced benefit administration for a cost savings of $492,000.
Financial Results: For this client, whose annual revenues approach $100 million, STHRM achieved the following results:
- Net annual savings: $2.1 million, leading to a return on the client’s investment of 93.0%.
- Provided client an opportunity to increase Operating Income Improvement saving $2.1 million.
- Value: Based on an improvement of $2.1 million in EBITDA, estimated value creation for this client is in excess of $12 million.