Case Study: Food Producer Helps Employees Keep Up With Expansion

March 2006

The Company:
Morningstar Foods, a subsidiary of Dean Foods

The Challenge:
To ensure employees have the skills necessary to keep up with rapid technology changes and production growth

The Solution:
Using WorkKeys®, administered by Blue Ridge Community College, to hire qualified employees and lower employee turnover

The Results:
A 35 percent reduction in turnover, significant training cost savings, and a competitive advantage that boosts the company's bottom line

Situation
Morningstar is a subsidiary of Dean Foods, the largest processor and distributor of milk and other dairy products in the country. Dean expanded significantly in recent years, including the 2001 acquisition of its Morningstar facility in Mount Crawford, Virginia. The Mount Crawford facility underwent a rapid space and employee base expansion—from 90 to 280 employees in just four years—along with a conversion from "short shelf life" milk gallon production to "extended shelf life" products that include soy, organic, and flavored milks.

Faced with the need to change its production technology to meet the new product line and its sudden demand for new employees, Morningstar's Mount Crawford facility needed an effective selection and employee development system. A review of the changing job skill requirements indicated that employees would need an entirely new set of critical thinking skills similar to those tested by WorkKeys assessments.

In early 2003, Morningstar partnered with nearby Blue Ridge Community College to profile four plant jobs. Profiles indicated that the jobs required skills in five WorkKeys skill areas: Applied Technology, Applied Mathematics, Locating Information, Reading for Information, and Observation. By the end of 2003, Morningstar had profiled two more plant jobs. When applying for job transitions, incumbent employees were required to achieve the WorkKeys scores indicated by the profiles.

WorkKeys testing also became a mandatory part of employee hiring. In 2005, Morningstar became a supporter of the Virginia Career Readiness Certificate. The company accepts certificates from job applicants and compares their scores to job profiles.

Results

Reduction in training time—Training at Morningstar is on-the-job. New hires shadow mentors for the first weeks of their tenure and begin independent work only once their mentor and supervisor have deemed them ready. Prior to implementation of WorkKeys, the average new hire shadowed a mentor for two to three months. After implementation, the average time was four to six weeks. This is a 50 percent reduction in training time and results in a cost savings per hourly employee of between $2,500 and $3,700.

Lower turnover rates—In an industry traditionally plagued by high turnover, Morningstar has seen a significant decrease in turnover among its new hires. A study compared Morningstar employees hired using the WorkKeys system and employees hired without WorkKeys. Researchers found only 15 percent of employees hired with WorkKeys left in their first year, compared to 50 percent of those hired without WorkKeys. Also, employee turnover decreased by 35 percent from 2003 (when WorkKeys became mandatory) to 2004.

Increased investment in the Morningstar Mount Crawford facility—Dean Foods has dedicated $130 million to the Mount Crawford facility's development and expansion, $57 million of which was won through competition with plants in California, Kentucky, Maryland, New York and Wisconsin. Former Virginia Gov. Mark Warner applauded this investment, stating that "Morningstar Foods' decision to expand its state-of-the-art dairy processing facility is a welcomed opportunity for Mount Crawford. The Valley will gain additional revenue and employment, while the company will benefit from the region's skilled workers."