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A.
The Company
Canadian General-Tower Limited
is a privately held polymer products company based in Cambridge, Ontario. The
company is a leading manufacturer of coated fabrics for the automotive industry
as well as other products such as pool and containment liners, roofing
materials, decking, and binder cover-stock for the stationery market. With
“constant innovation” as a key business principle, the company invests
considerable resources in the design and development of new materials for
automotive applications, such as its “Protein Leather,” developed by its R&D
group in Cambridge, and is continually developing new designs for the appearance
of its products.
Eighty percent of the company’s
business is in the automotive sector. It is the largest supplier of vinyl
seating material for motor vehicles serving customers located throughout the
world. The remaining twenty percent of Canadian General-Tower’s business
activity is in the production of swimming pool liners, containment materials for
industry and new industrial roofing products.
Growth at Canadian
General-Tower has been stable over the last 3–4 years. The company’s last major
spurt occurred in 1998–99 when it acquired its Toledo, Ohio based subsidiary -
Textileather Corporation. Consolidated sales for the Canadian manufacturing
facility (Cambridge, ON) and the American subsidiary (Toledo, OH) were estimated
to be in excess of $300 million for 2003.
Innovation vital to success
Innovation is a key part of
Canadian General-Tower’s ongoing success. The company’s technology group based
in Cambridge, Ontario, has been responsible for developing the company’s new
products or materials, such as “Protein Leather,” a blend of leather and vinyl
for automotive seating uses. Innovation also takes place on the design side of
the operation, allowing the company to meet evolving demands and tastes in the
appearance, grain and patterns that are applied to such products as automotive
vinyl fabric and swimming pool liners.
Employment Profile
Canadian General-Tower
employees some 1,100 individuals, including management, 700 of these at the
Cambridge facility, of whom 500 are unionized, and; another 400 in the Toledo
facility, of whom 300 are unionized. Workers at the Cambridge plant are
represented by the United Steelworkers. With few exceptions, the company’s
workforce is full-time.
The major occupational
categories represented at Canadian General-Tower are: operators (skilled
positions), maintenance tradespersons, and semi-skilled employees (forklift
operators, materials cutters, inspectors, etc.). At the Cambridge facility, some
50–55 people are employed as tradespersons (electricians, mechanical,
pipefitters) and another 20–30 work in the highly skilled,
technical/technological area, and an additional 35 workers specialize in product
development and design.
Employee Turnover Low
The company estimates that the
employee turnover rate at its Cambridge facility is in the range of 4% to 4.5%,
a figure that the company itself considers ‘average’ relative to other
companies, but which indeed appears to be quite low compared to industry
averages. Turnover includes a few retirements from the company’s workforce (the
average age of the workforce is 43–44 years).
Canadian General-Tower
attributes its low turnover in part to the fact that it is a well-known employer
in a relatively small community. Seventy percent of the company’s employees
actually live in Cambridge, while many of the remaining employees live within
neighbouring communities. The company notes that it is very common to see
several generations of the same family working at the Cambridge plant.
Generally speaking, then,
Canadian General-Tower does not feel that it has a turnover problem. The company
is able to fill vacancies relatively quickly, and turnover is not strongly
concentrated in particular occupational groups. However, the hiring of
journeypersons in the maintenance trades area can often be more difficult than
it is with other occupational groups.
Nevertheless, the company notes
that higher rates of turnover would be a significant problem, and does
engage in a number of activities and programs that potentially affect its
employee retention. For example, external compensation reviews are frequently
conducted to ensure that the employer is offering a wage that remains
competitive.
B.
Programs & Initiatives Affecting Employee Retention
Compensation and Benefits
Compensation reviews are
regularly undertaken to ensure that the company is offering its employees a
competitive wage. Canadian General-Tower sees its own compensation levels as
being average within the industry. In addition, internal salary reviews
are also conducted in an effort to ensure that there is wage equity among
comparable jobs and qualifications within the company.
The company is not extensively
involved with incentive plans except at the executive level, and phased out its
profit sharing plan many years ago. However, Canadian General Tower does have an
individual merit increase system in place. Wage or salary increases based on
individual merit are closely tied to the company’s goal setting process.
According to the company,
Canadian General-Tower’s employee benefits plan was at the leading edge when it
was introduced in 1991. The plan continues to be comprehensive and flexible,
allowing employees to change their benefits options annually, and also includes
a “defined contribution plan” provision. Pre-retirement counseling is available
to employees over the age of 50. The company also has an Employee Assistance
Program.
Training & Development a
Must
Canadian General-Tower is
extensively involved in the training and professional development of its
employees. It feels strongly that good training programs and ample opportunities
for career growth within the company are the key to Canadian General-Tower’s
success in keeping its employees. Programs offered by the company include:
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Educational Assistance. The company provides educational assistance to all
employees, covering up to 90% of educational or training costs, to a yearly
limit of $1,500.
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Health & Safety. The company’s health and safety training is extensive and
goes well beyond what is provincially mandated.
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Cross Training. A formal cross-training program exists in the company’s
printing department. People are given the opportunity to qualify themselves in
the operation of a number of different printing machines and equipment.
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Apprenticeship Training. The company sponsors two apprentices in the
maintenance trades area at any given time. Interested members of the existing
staff are selected for assessment at nearby Conestoga College.
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Succession Planning. The company’s formal succession planning initiative
aims to identify high potential employees among the professional and
management group who may be candidates for internal promotion. The company
conducts assessments to identify potential successors, determine the training
they will need upon promotion, the amount of time it will take for them to be
ready to assume their new responsibilities, and the most likely avenues for
promotion.
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Training Plans for Salaried Employees. Training plans for salaried
employees are formalized after performance reviews, and the company conducts
follow-ups every 3–4 months.
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Orientation & New Employees. Orientation training is provided to all new
employees, whether they are hourly or salaried. Where relevant, new employees
are provided with “thorough and comprehensive” training in technical
development areas, quality engineering areas, and safety and health areas.
Shift Scheduling Options
Some 80 people work under
alternative shift arrangements. Under this plan, employees work 12–hour shifts
on Saturdays and Sundays, and are off from Monday to Friday. Employees working
under this shift schedule earn the equivalent of a full, 42 hour workweek.
Recruitment & Selection
For hourly wage earners within
the company, a formal job posting system allows the company to recruit from
within its existing workforce. Candidates selected for a posting are provided
with the training that is needed to assume their responsibilities. Each position
that is left open as a result of the new posting is re-posted into the system
with similar provisions for all existing employees who wish to fill the vacancy,
thereby creating a ‘chain’ of postings. The internal job posting system allows
hourly wage earners to apply for supervisory positions before the company
recruits externally. This represents an additional potential benefit to the
company in terms of reduced training periods and recruitment lead times for such
positions.
Canadian General-Tower also
strongly encourages employee referrals, as these are the company’s main source
of new recruitments. The company uses this system frequently as a more reliable
alternative than placing external advertisements for vacancies.
Work Teams & Participative
Management
Canadian General-Tower has had
some involvement with self-directed work teams, with mixed results. An attempt
to implement self-directed teams in the plant’s dry laminating facility was
abandoned after no significantly positive results could be observed. The company
does, however, operate a small distribution centre in Brantford, Ontario. The
centre’s employees work in a self-directed team environment, and no grievances
or turnover have been observed in that location.
On the whole the company admits
it has not gone very far in the area of participative management. However, such
work arrangements are likely to be more commonplace at Canadian General-Tower
with its recent decision to implement the Six Sigma® system.
Communications
Although there is no regular
system of newsletters or communication, the company does communicate frequently
with employees during periods of major change. The company started to implement
the Theory of Constraints management system in March of 2002. In connection with
this initiative, the company circulated monthly newsletters and held small group
meetings to explain to employees what the company was in the process of doing.
The company also develops
charters for particular business areas in which improvements are being sought.
The charters are communicated to the relevant salaried employees, and are
subsequently used for individual goal setting for these employees.
Recognition & Awards
The company gives non-monetary
service awards for long-standing service to the company. The company also has an
employee recreation association that organizes festival nights-out, parties,
baseball teams and participation in an annual dragon boat racing event. These
activities are funded by the company.
Other Initiatives
The company has a 5-day-a-week
casual wear policy.
C.
The Employee/Union Perspective
Plant workers and maintenance
tradespeople at Canadian General-Tower are represented by Local 862 of the
United Steelworkers. The current president of the union local, who has worked at
the company for 27 years, says that relations between workers and management at
the company have seen their highs and lows, but reports the relationship has
been constructive for the past number of years.
The union representative feels
that a number of factors have contributed to good retention at Canadian
General-Tower. People are, firstly, very satisfied to be working in a clean,
well-organized manufacturing plant. Workers also recognize that the wages and
benefits are very competitive for the region.
The company’s alternate shift
scheduling policy — referred to as ‘weekend crewing’ — is also highly valued by
many of the plant’s workers. It was negotiated some 17 years ago, at the
initiative of the Local, and is seen by the union as having survived so long
because it was perceived as being mutually beneficial to both workers and
management.
Union Support for Training
While the representative still
felt that the company had some way to go in establishing a truly comprehensive
training program, he felt that the plant’s workers were generally happy with the
level of training support provided. It should be noted that unionized employees
frequently deliver the actual in-house training. In addition, employees are
involved in a lot of ‘educational training.’ For example, members of the joint
pension committee are actively involved in educating plant employees on
retirement planning and investing for their pensions.
The union has also been very
supportive of the ‘pay for knowledge’ cross-training program implemented in the
company’s printing department. The program has conferred mutual benefits to both
the company and its employees. According to the union, this program provides the
skills the company needs to ‘upshift’ during its peak business periods, and also
allows it to go after more business than it could if it didn’t have the
necessary flexibility in place. This, in turn, translates into increased job
security for workers, and better compensation.
Improved Communications
While there is still room for
improvement, the union’s representative feels that communications between the
company and its workers are quite open, and that a high level of trust exists
between the two parties. Things were not always this way. Some 15 years ago,
according to the union, relations had hit rock bottom, with many disputes in
evidence but little resolution to outstanding problems. Canadian General-Tower’s
CEO at the time led the way in mending relations and opening the channels of
communication with the company’s workers. External training was even provided to
both union and company representatives in order to create a more cooperative
culture.
Today, the company and the
union enjoy very open communications. Monthly joint meetings require a high
degree of openness on the part of the company. It shares financial and core
business information from time to time with union representatives, and workers
are generally well apprised of major changes in operations.
Relations have been somewhat
more strained recently due to the difficulties faced by the industry over the
past 3–4 years. But even in these difficult times, workers have been willing to
accept — by a margin of 89% in favour — a less-than-optimal one-year collective
agreement (where normally 3-year contracts were the norm). The union credits
this, in part, to the fact that workers at the company were given enough
information to help them understand why the company was experiencing the
difficulties it was going through.
Of course, the 1-year agreement
did provide some modest wage increases, but the true strength of the cooperative
nature of relations at Canadian General-Tower is the fact that both sides have
seen the benefits in having good relations, and have built up a high level of
trust over many years.
Conclusion
The company does not have an
explicitly articulated policy on retention, nor does it seek to integrate its
many human resource practices into its broader performance goals or strategic
vision. Indeed, it is somewhat skeptical about the possibility of linking the
outcomes of these various initiatives to performance goals in a way that is
reliable and measurable. Nevertheless, the company appears to have an excellent
retention record, and this can be credited to good compensation, good
communications, an extensive training program that provides excellent
opportunities and skills development for its workers, and a cooperative and open
relationship with its labour union.
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