Case Study: $4M in Annual Savings Achieved by Reducing Attrition by 35%

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The Challenge

A national retail logistics group faced an alarming 110% attrition rate among first-year employees, particularly affecting 800 order selectors critical to warehouse operations. This led to:

• Increased waste and error rates.
• Higher overtime and onboarding costs.
• Lost revenue and capacity exceeding $5 million annually.

Despite efforts such as pay raises, enhanced benefits, and better training, traditional solutions failed to address the root causes of employee dissatisfaction and turnover.

The Solution

Partnering with FOUNT, the organization identified and addressed key sources of work friction impacting employee retention:

1. Pinpointing Friction Moments:
   • Key activities analyzed included navigating the warehouse, learning job tasks, discussing pay, coordinating shift plans, and taking breaks.
   • Touchpoints such as supervisor interactions and tool usage (e.g., pallet jacks) were examined for inefficiencies.
2. Data-Driven Interventions:
   • Improved Communication Strategy: Weekly video updates and shift coaches for new hires reduced misunderstandings and improved support.
   • Enhanced Training: A 12-week, app-guided onboarding journey was introduced, ensuring consistency and empowering senior employees to mentor new hires.
   • Reorganized Warehouse Layout: Simplified navigation through re-slotting improved productivity and reduced confusion for new hires.
   • Staffing Adjustments: Increased headcount eased workloads and improved work-life balance for employees, fostering collaboration and reducing burnout.

The Results

After just four months, these targeted actions led to:

• 35% Reduction in Attrition: Average tenure for order selectors increased by eight months.
• $4M Annual Savings: Cost reductions stemmed from improved retention and operational efficiencies.
• 20% Productivity Increase in Year 1: Enhanced workflows and satisfaction boosted overall performance.
• Improved Work Environment: Balanced workloads and better communication created a more sustainable and engaged workforce.