STHRM, Inc. Restructures Precision Machining Company with Northeast Ohio Consulting Firm
Providing value to its clients since 1993, Shared Time Human Resources Management, Inc. is a value-oriented human resources solutions company. Through private consulting and custom-designed systems, STHRM, Inc. presents a high-value/low-cost solution to fixed-cost human capital issues. STHRM, Inc. staff has more than 30 years of corporate human resources experience with Fortune and Inc. 500 companies as well as privately owned businesses.
The client is a privately owned north-central Ohio contract precision machine shop with 175 employees and a $30 million annual revenue. The client operates a three-shift schedule. A Northeast Ohio consulting firm hired STHRM, Inc. to act as the Interim Director of Human Resources.
The challenge was to improve the client's deteriorating infrastructure which included human, financial, operations, and marketing processes to reach sustainable performance growth and prepare the company for sale.
In less than one year, STHRM, Inc. achieved the following specific and measurable results:
Recruitment and Employment
Sourced and implemented assessments to measure a candidate's machining and mathematics proficiencies.
Developed employment process to include reference check, background check and pre-employment physical and drug test.
Recruited and hired candidates for the following positions:
Machinists Set-Up Operator
Grinder Set-Up and Operator
Acme & Browne & Sharpe
CNC Maintenance Technician
Human Resources Manager
Developed and facilitated weekly workforce meeting for temporary, full-time production and salaried employees as part of the Sales and Operation Planning meeting.
Compensation and Benefits
Presented health plan changes and estimated health cost projections to the board of directors for their approval.
Developed and implements four tier healthcare charges.
Developed and finalized next year’s health benefits model for employee’s cost sharing at 20% or $495,015.
Estimated company cost savings of $268,800 for spousal carve-out or extra charge for spouse if employed and has hospitalization insurance available at their employer.
Reviewed and analyzed the Summary Plan of Benefits for Retirees age 65 and Over (Medicare Gap Insurance) effective October 1.
Prepared letter for legal review concerning company’s Medicare Supplemental insurance (retiree) and current medical policies to comply with ERISA.
Wrote a letter to company retirees regarding 20% co-payment and spousal surcharge, if applicable, for the cost Medicare Gap Insurance coverage.
Merged 401(k) and company profit sharing plans into one, saving an estimated $20,000.
Sourced local area compensation information to ensure the company was competitive in the marketplace.
Recommended to eliminate general compensation increase and replaced with a performance-based merit increase system.
Implemented digital time clock to track time and attendance and minimize payroll processing time, saving an estimated $15,000.
Developed flow chart on performance.
Implemented Performance Appraisal and Development Plan Guidelines and Performance Improvement Plan.
Developed Visual Management Skill Matrix for CNC, Single and Multiple Spindle Departments.
Conducted and implemented review and finalize the company’s present and future organizational structure.
Prepared management’s indication of future staffing requirements.
Business Expense and Credit Card.
Company Sponsored Club Membership.
Suspension of General Increases and Cost-of-Living Adjustments.
Preparation To Sell – HR Due Diligence
Wrote key employee resumes, primary responsibilities, prior experience, education and years with the company and other biographical information.
Senior management compensation and incentive benefits.
Analyzed employee turnover during the past three years.
Prepared BWC claim history and loss run report for the last three years.
Prepared overview of employee benefit plans.
Net annual savings of $798,000, leading to a return on the client’s investment of 83.1%.
Provided client Operating Income Improvement through savings of $798,000.
Value: Based on an improvement of $798,000 in EBITDA (multiple 5 or 6), estimated value creation for this client of $3,999,000 to $4,788,000.
Notice: In order to maintain strict client confidentiality, business-specific information has been removed from this case study. The presented situations, activities, programs, projects, actions, and subsequent results are accurate.
If you are interested in learning more about this case study, results and services offered by STHRM, Inc. please contact, Glenn Levar (telephone: 440-979-1046, e-mail: firstname.lastname@example.org). To learn more about STHRM, Inc. visit www.sthrm.com.
STHRM, Inc. has teams and strategic alliances with executive wealth management experts, health and life insurance brokers, 401(k) providers, interim executives, professional advisers, operations professionals, third-party workers’ compensation administrators, and employment/contract attorneys.
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