How some companies tap valuable labor sources their competitors can't touch by training their employees well.
Teaching job skills is one thing. Companies that really understand training are tapping valuable labor sources their competitors can't touch
When Chico Lopez started work at Triton Industries Inc., in Chicago, nine years ago, the only material he could cut was hair. Five years as a barber had given him none of the skills needed for the cutting and shaping of metal.
Three months after he landed work at Triton as a temporary laborer, though, Lopez started as a full-time machine operator, and from there his professional education began. First came a class in tool-setup safety through a local trade association, then courses in precision-instrument and blueprint reading at Triton. Finally, Lopez studied management courses in everything from motivating employees to total quality management (TQM). Today, as the lead man in the stamping department, he earns about three times his starting wage.
Lopez's rise to a well-paying, skill-intensive job is far from unique. Virtually all of Triton's supervisors earned their positions by learning new skills from, or with the support of, the company. The reason is simple: "We could not stay in business and stay the way we were even two years ago," says production manager Jeri Barr.
Triton's stance is one of, oh, about half a million arguments for training. In fact, the debate is not over whether to train but over how. Many manufacturers consider the upgrading of their workers' skills to be the answer to competitors who use low-cost overseas labor. The quality push is forcing previously unskilled workers to grasp statistical concepts so they can better control, say, the consistency of output from a mold or the variation in on-time shipments from a warehouse.* * *
Above all, training lays bare the basic compact between a company and its employees, exposing the company's commitment to the future and revealing trust that workers can learn new skills, take on more responsibility -- and risk failure. There's risk on the employer's side, too; plenty of CEOs can gripe about employees who took a walk once they completed their training.
Experts don't argue for massive formal training. Marc Tucker, president of the National Center on Education and the Economy, in Rochester, N.Y., points to one simple mandate: "There must only be opportunities for people to learn." Indeed, great small companies show that training can take any form -- and ultimately comprises far more than teaching practical skills.
About the only common element is that great training serves an immediate purpose and vividly illustrates the values and culture of the company itself. That's the case at Luitink Manufacturing Co., in Menomonee Falls, Wis. Sure, the metal stamper conducts ongoing classes in new skills such as inspection of presses, but management's belief is that the real training takes place on the shop floor.
Five years ago the company, suffering from productivity-sapping employee turnover of 30%, acknowledged it had to change. As part of that change, it redefined training as the learning that occurs between employees when they work together productively. "Usually, the first thing that comes to mind is a lot of technical training," says vice-president of manufacturing Joe Hauk. "But as we changed from an autocratic company to one with a lot of empowerment and team building, we began looking at training as understanding how employees interact with each other." Consequently, Luitink's full-time trainer, Gary Wenzel, now sees his primary role as ensuring that knowledge flows from worker to worker.
It appears to work. Five years ago press operator John Hausner did no more than his defined duties, backing off during machine changeover to let the die makers ply their trade. But now he's absorbing some of the skills -- and responsibilities -- of his teammates as he learns how to change the dies himself, freeing the die makers to focus on more skill-intensive tasks like sharpening dies.
That experience leads Hauk to make a counterintuitive claim. "Once, we believed in hiring people for the skills they had," he says. "We now believe we can take someone with the attitude and the desire to learn and make that person into the best machine operator there is."
At Dettmers Industries Inc., in Stuart, Fla., team-based manufacturing also prompts a horizontal sharing of skills. But there, technical talents are merely table stakes for the more ambitious training in how to work on a team. CEO Michael Dettmers says his training is based on "learning to learn. I want to deal with the real issues that prevent people from coordinating action together -- which is my definition of teamwork."
Dettmers offers Saturday training classes that involve role-playing and other exercises that challenge the employees' assumptions. "People show up in games the way they show up in real life," he says.
Lofty goals notwithstanding, training can also mean good old teaching of job skills. Few do it better than Triton Industries, where founder and chairman Marvin Wortell claims to spend 1.5% of sales revenues on training -- a higher share than at many larger companies. Wortell says 75% of his work force -- three times the percentage of a decade ago -- now has some level of skill, such as the ability to operate precision machinery.
Triton has taken a page from the big boys: at its "Technical Institute" (a second-floor classroom), it runs a four-semester, 32-week course called Sheet-Metal-Craftsman-Related Theory, which includes classes in reading blueprints and precision instruments; statistical process control; and team building for TQM. Workers who complete the first eight weeks of the course receive $225; as the courses ramp up, so do the incentives.
Across town in Chicago, Northwestern Tool and Die Manufacturing operates an aggressive apprenticeship program, in which an unskilled teenager can start earning a good wage while learning a craft. About one of 12 applicants displays sufficient mathematical skills and mechanical comprehension to join the program, says founder and president Norbert Stengel. The apprentices begin by earning $8 an hour to observe the craftsmen before starting to operate machines themselves. The initiates learn skills from the shop veterans and take night courses in related theory. As the apprentices rotate through the work areas, they receive quarterly reviews with automatic pay raises. When they graduate, they earn roughly $17 an hour. Stengel says his skilled toolmakers who work a 50-hour week can earn $70,000 a year.
Northwestern engineering manager Jim Koppe remembers his first contact with the company vividly. The shop was making an injection mold for an automotive grille. Koppe took one look and was hooked. "It amazed me that someone could take this raw steel, machine it, and create this grille. I suddenly saw this work as craftsmanship -- not a production line," he says.
Koppe went through the apprentice program and continued to learn after he graduated. Now he's taking a night course -- paid for by Northwestern -- on Autocad software for computer-aided design.
Yet training can address very different traits. Starbucks Coffee Co., based in Seattle, uses it to animate dead-end jobs, motivate employees, and tell the company story, tying training to the overall business strategy. "To build the company, we must build each individual," says education director Paul Evanson.
The courses are meant to build affinity with the company; call it training as propaganda. To Christyn Arnsperger, who supervises all training at Starbucks's California operations, that inculcation in company culture means teaching mutual respect and dignity. "When we address an employee, we're thinking about how we're building or enhancing that employee's self-image," she says. Managerial courses use role-playing to examine how managers ask questions of employees.
The concept has rubbed off on Derek Basco, a former gas-station attendant who mans a Starbucks shop in Los Angeles. He says the training helped him develop service skills that go beyond learning a script to act out for customers. "You learn to ask questions so that when the customer has a need, you're able to meet it," he says.
Everyone takes at least 24 hours of initial courses at Starbucks. Managers are expected to have a detailed knowledge of what they teach, so they take the courses and work for two months in retail. Many who take the training decide to participate further: 350 of Starbucks's 2,800 employees are certified trainers.
Training can also prod workers to think of their informal work relationships as learning forums. At Datatec Industries Inc., in Fairfield, N.J., which installs in-store computer systems, a mentoring program complements a quality drive that includes more conventional training modes. "The people who become mentors are those who understand the quality process better," explains Mike Janicek, who manages the help desk that provides support to customers. About 100 of the 325 employees are mentors.
Janicek says mentoring can take any form. It takes place in scheduled meetings and in random encounters in hallways, reinforcing the sense of close-knit community that encourages cooperation. That alone is a payoff worth having.
325 employees, $40 million in sales
Features a mentoring program in which "expert" employees spread both "hard" and "soft" knowledge to their peers. About one-third of all employees are mentors.
25 employees, $1.5 million in sales
Focuses on "learning to learn" with Saturday role-playing games that help individuals break down barriers to the coordinated action needed for teamwork.
Menomonee Falls, Wis.
40 employees, $6 million in sales
Defines training as the horizontal learning passed from skilled worker to worker on well-run teams.
Northwestern Tool and Die Manufacturing
Precision tool manufacturer
105 employees, $10 million in sales
Offers an aggressive apprenticeship program that pays unskilled novices an immediate good wage to, initially, do nothing but observe.
Coffee retailer and wholesaler
2,800 employees, $93 million in sales
Ties training to business strategy by formally building employees' affinity with the company. In classes, stresses everything from coffee knowledge to interpersonal relationships.
160 employees, $12 million in sales
Pays employees to attend its four-semester, 32-week Triton "university." In curriculum, includes classes in reading blueprints and team building for TQM. Spends 1.5% of sales revenues on training.