Steve Anderson ACT Workforce Development Return on Investment

Agenda WorkKeys & ROI Outcomes WorkKeys Value Data Sources WorkKeys Cost Data Case Studies Questions / Discussion

How do businesses use WorkKeys? Recruitment / applicant screening Selection  Pre-employment  Internal career opportunities Incumbent employee training & development Training program development / alignment Succession planning / Career laddering

WorkKeys ROI Outcomes WorkKeys can provide measurable financial outcomes and value-added benefits in the workplace in the following categories: Employment Practices Employee Training & Development Performance Metrics

ROI Calculation The purpose of the ROI calculation is to compare the costs of an intervention (WorkKeys) with the value of its results. ROI = Value – Costs / Costs x 100 (percentage ) Value is determined by converting measurable outcomes into dollars (savings, profit margins, etc.) ROI formulas are predicated on specific metrics that are critical to a business’ success.

ROI Value Data Sources: Employment Metrics Hiring / Turnover / Attrition Cycle: Recruiting costs # of job applicants Interviews / hires ratio Interview hours Processing time New employee training costs Unemployment costs

Number of employees trained Completion / success rates Training dollars Training time Time to proficiency Performance impacts as a direct outcome of training ROI Value Data Sources: Training Metrics

Company-specific production measures Product quality / error rates / remakes Cost reduction: - Overtime hours - Supervisory ratios - Scrap rates Absenteeism, Corrective actions / safety violations Increased customer service / reduced complaints Sales / Profit margins ROI Value Data Sources: Performance Metrics

ROI Cost Data Resources Compensation (recurring): Average wage (include benefits) for profiling / assessments Lost Time (recurring): Average time off the job to participate in job profiling & testing Test Costs (recurring): Test fees, administrative costs (preparation, proctoring, scoring), facility costs Development Costs (one time): Costs to establish WorkKeys system in the organization

Case Studies: The System in Action

Employment ROI Case Studies Mid-American Energy: - Meter Reader turnover reduced* (83%) - Overall turnover (5 positions) dropped 51% Bradner Retirement Village: - Decreased interviewing time (75%) - Decreased processing time (55%)

Training ROI Case Studies Morningstar Farms: - Training time reduced 50% - Cost savings of $2500-$3700 per employee Northrop Grumman Ship Systems: - 28% reduction in turnover (layoff) rates - Reduced layoffs via cross-training ($2M savings)

Performance ROI Case Studies Creative Extruded Products: - Overtime hours reduced (95%) - Scrap expenditures reduced (21%) - 50:1 profit / cost ratio UP Special Delivery: - Increased productivity resulted in 20% staff reduction in data processing department

Non-Financial Outcomes Employee satisfaction / morale Management / supervisory satisfaction Increased employee focus on education Industry competitiveness Job satisfaction Skill data (succession planning) Employee performance ratings

Who Uses WorkKeys?

Contact Information: Steve Anderson Questions / Discussion