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Pat Walter, McLane Distribution, Athens, GA Dear Mr. Walter, This is Casey Laws from the Better Business Bureau. As McLane is growing larger every year, it becomes quite a task trying to follow the employees, and sir, that is what we have been doing. For the past four years (1996-1999), we have kept track of the employee turnover rates in the McLane Distribution as a whole, as well as the Distribution Center in Athens, GA. We have been running this data so that you can continue to build a stronger company, as well as build a stronger force of committed employees. After analyzing this data, and developing a model using graphical representation, we have found the turnover rate has dropped considerably in the past four years. The greatest change in both the Company as well as the Distribution Center, was from 1996 to 1997. By having such a large decrease in turnover rate in such a short period of time, our graphical representation was somewhat skewed. What we found was that by representing the turnover rate relative to the year, our graphical model came to be an exponential representation. We feel this is partial to the fact that the rates have dropped rapidly in a short period of time. Now, our job was also to develop a model that may represent what may happen over the next five years, so that you may be available to make any changes necessary. We could see by the first models of the data that within the past two years, the turnover rate has started to somewhat level off, bringing our exponential model to a decrease, which is good news for your Company. That is why we predict that within the next several years the turnover rate may not continue to decrease at as large of a rate as it has in the past, but it will not begin to increase either. Sir, you may consider different incentives to effectively maintain this low turnover rate. Incentives such as duty-free lunch , clean working environment, and job benefits are what we have found work the best to ensure a happy work force in a Company of your stature. Thank you Mr. Walter for your time, if there are any questions, concerns, or comments, my address is above. Good day. Sincerely, Casey Laws
McLane Distribution Center, Athens, GA Dear Management, After visiting the McLane Distribution Center in Athens, I became interested in many of the aspects of your company. In particular, I have taken an interest in the turnover rates of the entire company as opposed to just the Distribution Center. I have taken some time to observe these turnover rates for your company and the Distribution Center. I have noticed that, since 1996, the turnover rates for McLane overall and the turnover rate of the Distribution Center have both decreased, but the turnover rate for the Distribution Center is decreasing more dramatically. I have come up with a graph and a formula for each of the centers. Both of the formulas are exponential formulas, which means that the models will always be decreasing. So if, by chance the turnover rates were to increase one year, this model would not be correct. Also, the model will never reach zero percent, which is actually very realistic because almost never will your turnover rates reach 0%. According to my model, over the next five years, you can expect for the turnover rates of McLane overall to reach as low as 2.053% and the turnover rates of the Distribution Center to reach as low as 1.5%. As you can tell, these rates might be a little unreasonable. A way to help make better predictions is to have a larger set of data. I only knew the rates for years 1996-1999, which is only four years. If I could have observed more years than this, then I believe that I could better predict the turnover rates for the future years. I believe that the turnover rates for McLane overall can decrease just as quickly as the Distrbution Center's rates if you just work on a few things. Maybe, you can increase wages, produce better working conditions, or even give better or more benefits to your employees. I appreciate you taking time out of your day to hear my concerns for your company. I hope that you will now take these rates seriously and try your best to overcome all of the small limitations that exist. Sincerely, Doris Daniel Mr. Pat Walter, McLane Athens, Ga. Dear Mr. Walter: I would really like to help McLane improve itself as a company. I have been analyzing your decrease in turnover rate over the past four years and by the looks of the steady decrease it looks as if your company will be able to decrease the turnover rate even more over the next few years. However, your turnover rate will never be zero, which is good because you do not want to have no one leaving for being promoted. Also looking at the model of the turnover rate over the past four years the best equation that fits the data is an exponential function. However, according to the model your turnover rate will never be able to be zero because an exponential function an never reach zero. The graph gets closer and closer to zero but never reaches zero; it just limits to zero. I do not recommend that McLane try to overcome those limitations because you never want to have a zero turnover rate in a business. You always need new people coming into a business for new ideas and enthusiasm. I think McLane is doing a great job and should keep up the good work. Obviously, they are keeping their employees happy and reducing their turnover rate as much as possible. Please let me know if you have any further questions about how to reduce your turnover rate. Sincerely, Melanie Sauer McLane Distribution Center, Athens, GA 30605 Attention: Mr. Pat Walters Dear Mr. Walters: I am a student enrolled in the Mathematics Education program at the University of Georgia. As part of this program, I am currently taking a course dealing with contextual learning and teaching of mathematics. In this class we learn ways in which we can relate what is being learned in our classrooms to what our students will experience in their future lives. As part of this course, our class took a field trip to your Distribution Center, where we learned about turnover rates of merchandise and of employees. We also learned how employees of McLane Distribution Center use math in their occupation. After our visit our teacher gave us a packet of information to work on that dealt with the turnover rates of employees of McLane overall and of employees in the Distribution Center from 1996 to 1999. Upon examining the data provided and graphing it, I have come up with an exponential model that fits this data very well. This model should be an excellent predictor in what will happen with your turnover rates in years to come. According to my model the turnover rates at McLane will continue to drop. In the year 2005, the percent turnover in McLane overall will be 2.1. While the percent turnover in the Distribution Center in 2005 will be1.5. The models I used to predict these turnover rates are as follows:
These models are pretty accurate, but they are not perfect. The models are based on data for the past 5 years only. They also do not take into account changes in employee satisfaction and other factors of this sort. Since the model is an exponential one, the turnover rate will never reach zero, which seems to be realistic. However, this may limit the abilities of this model. I hope the information I have provided will help you see the tremendous job you are doing and encourage you to keep up the good work. Feel free to contact me if you have any questions on this model. Sincerely, Wesley Walker Athens GA, 30506 Dear Mr. Pat Walter: I am a consultant that works for the University of Georgia’s Mathematical department. Recently, I was assigned to review the turnover rate for McLane over all in comparison with the turnover rate of the Distribution Center only. By looking at your data, I figured out that the best trend line for your data points in turnover was the exponential function 87.67*.687^x. From the pattern of this function, you can accurately predict that in the year 2000 you can expect to have a 9.62 %, turn overate, and in the year 2005, your turnover rate will be as low as 2.05 percent. However, 125*.6428^x represents the turnover rate for the Distribution Center only. By looking at this trend line, we can see that the turnover rate of the Distribution center is at 13.2% in 2000, and 1.51% in 2005. Although 1.51% turnover rate seems unreasonable, it still brings into question how you can proceed to have lower turn overrates overall at McLane. Keep in mind, there are limitations to both models. For example, you cannot predict accurately the turnover rates for either McLane Distributions overall or for the Distribution Center only for years before 1995. (You would see percentages in the negatives and over 100 percent. ) Therefore, I recommend you only look at eh trend lines of your turnover rates after 1996. In addition, I think it would be a good idea to send in your turn overrates along with the Distribution turnover rates in another 10 years. We can see if this trend lines change, and how they can predict turnover rates for the future. As far as keeping the employees that you have, you are doing a great job. You leave little room for improvement, and you care an asset to the community as a source for a career. Please, keep in touch. Sincerely, Rebecca Parker |
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