Case Study: Northrop Grumman Ship Systems Develops a Ready-to-Train Workforce

November 2006

The Company:
Northrop Grumman Ship Systems, based in Pascagoula, Mississippi

The Challenge:
Assessing and developing employee foundational skills

The Solution:
Using WorkKeys^® job profiling, assessment, and training to assess and boost the skills of incumbent employees

The Results:
A 28 percent reduction in turnover, a significant boost in work quality, and millions of dollars saved in layoff and training expenses

Situation
Northrop Grumman, a defense contractor for the U.S. Navy and shipbuilder for private industry, is the largest private employer in Mississippi and Louisiana. One of the largest companies in the world, it employs 120,000 people in 26 countries.

The Northrop Ship Systems division (NGSS)—which builds the Navy's ARLEIGH BURKE (DDG 51) Class of Aegis guided-missile destroyers and the Navy/Marine Corps Team's SAN ANTONIO (LPD 17) Class of amphibious assault ships—employs approximately 18,000 people in Mississippi, Louisiana, and Alabama.

Like many employers, NGSS's goal is to retain its employees and increase their skill levels. "In the late '90s, we hired lots of people. Many lacked the foundational skills—such as mathematics, reading, and observation skills—needed to do their jobs," said Dr. Larry Crane, director of training for NGSS.

"We needed a tool to help us efficiently upgrade the foundational skills of our workers and identify training targets."

"Retention issues are sometimes caused by workers' inability to do the job, or when workers feel they are in a dead-end job," said Mark Scott, manager of resource development for training at NGSS. "There is a definite link between foundational skills and job performance, and people can't learn new skills if they don't have the foundation first. New skills result in more career opportunities for workers."

Needs
Northrop Grumman needed a system to pinpoint foundational skill gaps and offer training to overcome those gaps, along with training for skills specific to each job.

Solution
In 1998, Northrop Grumman joined the Gulf Coast Shipbuilding Partnership (GCSP)—a consortium that includes shipbuilding companies, labor unions, community colleges, workforce boards, and other agencies across three states. The consortium, funded by a grant from the U.S. Department of Labor's Employment and Training Division, was organized to address and overcome skill shortages within shipbuilding companies in Louisiana, Mississippi, and Alabama. WorkKeys is an essential part of the consortium, providing job profiling, skill assessment, and training for its business partners.

Job profilers at CARES, the managing partner of GCSP, examined four positions within Northrop Grumman's Hull Department—shipfitter, welder, burner, and grinder. Employees in those positions were asked to volunteer for a skill-upgrade program. More than 1,200 employees participated—about 65 percent of the department. Participants took the WorkKeys exams (Applied Mathematics, Reading for Information, and Observation) most applicable to their jobs, according to job profiles. The results led to each participant's "learning prescription," which blended WorkKeys-specific training from Worldwide Interactive Network, Inc. (WIN) with job-specific training.

On-site tutors served as case managers, providing one-on-one teaching and learning management using WIN materials. Successful participants received certificates of completion at a graduation ceremony.

Following the Hull Department's success, Northrop Grumman expanded its use of WorkKeys to other positions within Ship Systems. The company profiled more than 20 positions in 11 skilled trades throughout the company. Northrop Grumman currently uses WorkKeys in advancement programs for incumbent and dislocated employees, as well as a pay-for-skills program.

Results

Turnover reduction—Before WorkKeys, turnover rates varied across NGSS plants—ranging from 17 percent to 45 percent. Two years after starting to use WorkKeys with incumbent employees, turnover rates dropped in all participating plants ranging from 8 percent to 28 percent. Turnover in the Hull Department decreased by 20 percent.

Effective alternatives to layoffs—The new WorkKeys employee development system allows employees to cross-train and move to alternative positions during layoff periods. This allows for greater retention of qualified employees and a readily accessible workforce when production again increases. GCSP estimates that, as a result, NGSS saved over $2 million in 2004 alone.

Higher training completion rates—Prior to implementation of WorkKeys, training completion rates were as low as 10 percent for common programs such as blueprint reading. Since inception, completion rates have more than doubled.

Better employee attendance—Absentee rates at NGSS in 1999 ranged from 17 percent to 38 percent. After the introduction of WorkKeys, NGSS reported drops in absentee rates ranging from 3 percent to 21 percent.

Union participation—Labor unions involved with Northrop Grumman also support WorkKeys programs, according to Dave Whitney, director of trades at NGSS.

Success Stories
Many Northrop Grumman employees see side benefits of improving their skills through WorkKeys assessment and training.

Tonia, a welder, volunteered to assess her skills using WorkKeys. She had excellent scores, and GCSP personnel encouraged her to try college classes to build her skills. An aspiring industrial engineer, Tonia is about to complete her degree at a local community college. Her high grade point average caught the attention of Northrop Grumman personnel, and Tonia is in line for industrial engineering jobs at the company.

David, a rigger, did well on the WorkKeys tests but knew he needed to sharpen his skills to land a coveted job in the Quality Assurance department. He took GCSP training in WorkKeys skills, soft skills, safety, typing, and blueprint reading and now works in the QA department as an inspector.

Lester, a pipe fitter, couldn't read well enough to take the WorkKeys exams, so GCSP pointed him toward literacy classes. While taking classes, his wife had major surgery that included a tracheotomy. Because she couldn't speak, Lester had to depend on his newfound literacy skills to communicate with his wife through written messages. In addition, supervisors say his increased skills give him added confidence and make him a better pipe fitter.

"The more I get into WorkKeys, the more I realize what a great tool it is.": Dave Whitney, director of trades, Northrop Grumman Ship Systems
"WorkKeys allows us to target our efforts. It allows us to determine what the important skills are, and at what level you need to be proficient. Almost daily, we discover a new benefit and new use for it.": Mark Scott, manager of resource development for training, Northrop Grumman Ship Systems
"WorkKeys helps us determine where our employees are on the ladder of success, especially when it comes to promotion. All other factors being equal, the employee with the certificate of completion gets the nod.": Ed Portier, training specialist, Northrop Grumman Ship Systems – Avondale Operations