Understanding dairy employee attitudes, concerns & perspectives to improve employee management

Phil Durst & Stan Moore Michigan State University Extension

Employee management
! Increased importance of employees in larger dairies ! Daily care of animals is performed by employees. ! The degree of success of the business depends on the management of employees. ! Engaged employees perform better.

Engaged: a connection between an employee and employer which results in that employee giving Voluntary effort.
Charles Contreras Zoetis PeopleFirst

! Employees that work to get the desired results, not just to do the job; ! Employees that take initiative or ownership; ! Employees that are trustworthy; ! Employees that have a positive impact on the team as well as on the business;

Employee management
But many dairy producers least like managing employees, lack training to do it better and feel inadequate at it. Therefore, we designed this project to use employee feedback to make employee management recommendations and to help producers understand the perspectives of their employees.

Managing Dairy Employees More Effectively

! Grant from USDA NIFA, North Central Risk Management Education Center for the first year of the project. ! Phil Durst, MSU Extension Stan Moore, MSU Extension Felix Soriano, APN Consulting, LLC

Project: Managing dairy employees more effectively ! Contract with farms for a fee ! Owner(s) & manager(s) complete survey of what they expect employees will say ! Hard copy of questions (English or Spanish) provided ahead of time. ! Employees call bi-lingual interviewer for survey questions. Totally anonymous. ! Results analyzed, looking for common themes. ! Report prepared and presented to owners/ managers

Project: Managing dairy employees more effectively Project goals: ! Help dairy owners & managers understand employees perspectives ! Help owners & managers on these farms change their management to increase employee engagement ! Help other producers through educational programs based on what we learn.

! We plan to follow-up in year 3 to see what changes they have made and see if there is a change in any of several measures: - employee turnover rate - labor cost/cwt of milk - number of cows/employee - employee responses to questions

Areas employees are asked about:

! ! ! ! ! ! ! ! What they like most/least Teamwork with co-workers Knowledge of farm goals Equipped to do the job View of supervisor Their commitment to learning and the business Whether they get performance feedback If they think of ways to improve the business

Results:
! To date: 10 farms (MI, PA, NY, CT) ! Total cows: > 8500 Range: 589 1225 cows ! Total employees: 187 Range: 12 - 28 ! 145 interviews (78% response rate)
by primary language:

71 English, 69 Spanish, 5 Portuguese

Expansion plans:
! Recruiting new partners in Ohio, Iowa, Pennsylvania and possibly two other states ! Want to add 20 additional farms ! Want to add 300-400 additional employees ! September 2013 - August 2014

Results:
Employee turnover rates:
(# new hires/ # employees)

2011 range: 8% - 100%, Average: 46% 2012 range: 3% - 111%, Average: 46% Employed < 1 yr. 1 3 yrs. > 3 yrs. 18% 31% 51%

How long would you like to remain employed at this farm?

< 1 year Ave: 12% These are employees 2-3 years Ave: 21% looking for a reason to leave - - - - - - - - - - - - - - - - - - - - - 4-5 years Ave: 23% Until Retirement Ave: 44% Individual Farms (<1 yr. and 2-3 yrs combined): High: 66% Low: 17%

Data of farms enrolled:

Labor cost per hundredweight of milk sold: 2011! Range: $1.29 - $3.54, Average: $2.48 2012! Range: $1.27 - $3.05, Average: $2.14

Main problems identified to date:

! ! ! ! ! ! Underestimating employees desire to learn Failure to provide training Failure to specify goals Failure to provide specific positive feedback Failure to encourage employee input Employee-to-employee problems and lack of communication

1. Underestimating employees desire to learn

Q: How would you rate your interest in learning? (scale of 1 5) 1 = I already know enough to do my job 5 = I am interested in dairy and want to keep learning.

Q: How would you rate your interest in learning? 4.73 (across 145 employees)

Q: How would you rate your employees interest in learning? 3.27 (18 owners/managers) When we underestimate the interest of employees in learning, not only do we provide less training, but maybe we think they are less capable of learning.

2. Failure to provide training

Q: How often do you receive training to improve your skills? 1 = Never 2 = Only when I started 3 = Once a year 4 = Every 3 months 5 = Once a month

Q: How often do you receive training to improve your skills? 12% 37% 21% 18% 12% Never Only when I started Once a year Every 3 months Every month

3. Failure to specify goals (or KPIs)

Q: How well are the company goals communicated to you? (scale of 1-5) One farm to illustrate: Average rating: 3.55 3 replied 1: I have heard nothing about farm goals 5 replied 5: I know very well what the farm goals are 1 replied 4

Q: What are some of the farm goals that you remember? (of those who relied 4 or 5) ! Never heard about that ! Keep clean the machines and milking room ! To do what the owner teaches us and not to change it ! Follow the owners rules ! Better milk production. Cleanliness ! Milk the cows and keep everything clean. They told me what I should do and what I shouldnt

Employees want to know where the business is heading:

! They just tell me what I have to do, not farm goals ! Each day they just tell us what we have to do and thats it. We dont have any kind of information. ! All the companies usually put (up) charts (with the company goals), but here there is nothing. We come here like donkeys to do what we are told to do.

! Why dont dairy owners specify Key Performance Indicators for employees to meet? ! Frankly, we think it is because they dont identify specific outcomes to work toward.

Making employee full team members

We believe that in order for employees to be full team members that they need to know both the goal (or KPI) and the performance.

4. Failure to provide specific positive feedback

Q: How often do you receive feedback (good or bad) about your work from your supervisor? 1 = Never 2 = Maybe a few times a year 3 = Every 3 months 4 = Once a month 5 = At least once a week

Q: How often do you receive feedback (good or bad) about your work from your supervisor? 9% 31% 12% 24% 23% Never Few times per year Every 3 months Once a month Every week

Comments: ! Negative = 5, Positive = 1 ! Feedback is always negative, our job is (always) wrong. ! Positive never; Negative every week ! It seems that we never do a good job ! We normally dont get stuff like that

Q: In the last 15 days how often have you received recognition and praise for good work? 1 = Not once did he/she recognize what I did well 5 = He/she praised and thanked me at least several times in the last 15 days

Q: In the last 15 days how often have you received recognition and praise for good work? 37% 5% 13% 19% 26% Rated it 1: Not once in the last 15 days Rated it 2 Rated it 3 Rated it 4 Rated it 5

5. Failure to create an environment encouraging employee input Open-ended question (employees): How often do you come up with ideas to improve the operation (whether you share those or not)? Open-ended question (employers/managers): How often do they express to you ideas to improve the operation?

How often do you come up with ideas to improve the operation? What we think this question means: ! Are their minds engaged? ! Have they been encouraged with past ideas? ! Do owners/managers recognize the gift of working to improve the operation?

How often do you come up with ideas to improve the operation? Employee responses typically fall in one of three categories: ! Frequent ideas ! Infrequent ideas ! No ideas or Have ideas, but do not share

How often do you come up with ideas to improve the operation? 50% Frequent ideas ! I have ideas, they ask us for ideas to share too. ! Always thinking of things ! Quite often, if I see that I can make it better. 25% Infrequent ideas ! Once in a while. The other day I came up with an idea and shared it with the boss too

How often do you come up with ideas to improve the operation? 25% No ideas or Have ideas, but do not share
! I come up with ideas but I dont share them, as it is not my business, its always how they want to run it. ! I just do what they tell me to do. ! I have a lot of good ideas. I don't share them because he thinks we are stupid. He is not open to hear new ideas. ! Sometimes I have ideas, but they never take my advice, they don't care what we think or they don't agree.

6. Problems between employees

! Rate the Teamwork within the dairy: ! Farm range: 2.71 4.83 3.78

! Communication problems between shifts ! Good employees want others to work hard ! Employees see it as the managers role to hold employees accountable.

! There are some co-workers that don't do much hard work. They are always waiting for somebody else to do it. There is no communication. ! Certain people that are not working with each other. You can feel the tension. ! Q: What would you change? Be more serious on who they hire, check their background.

Employee to employee relations

! Employer cant force people to like each other, but they do have a role: - Involve employees in the interview process - Facilitate communication between shifts - Emphasize teamwork and helping each other, even at the end of a shift. - Hold employees accountable for results and methods.

Areas for management improvement

! Establish Key Performance Indicators in every area of the operation. ! Communicate KPIs ! Tie training to KPIs (Training needs to be frequent & progressive) ! Employee feedback needs to be relative to KPIs ! Encourage employee ideas ! Facilitate communication between and with employees

Therefore, we need to talk with dairy owners about considering their employees as: ! Partners and not as adversaries ! Thinkers and not as donkeys ! Individual persons and not as anonymous workers.

What weve learned from farm employees:

! Employees can reveal the strengths and weaknesses of management ! Employees can help us understand how to increase their engagement ! Employees show us the roots of turnover and lower productivity

Dairy owners and managers can profit by listening to their employees:

! Managers need to be humble enough to listen ! Managers need to be wise enough to take it into account and act on it.

Questions?
Thank you!
Phil Durst MSU Extension durstp@msu.edu Stan Moore MSU Extension moorest@msu.edu

Plans:
! Labor Management Educational Programs in Michigan in the winter of 2014-15 ! Publication of results