Professional Documents
Culture Documents
The authors are undergraduates at the State University of New York at Oswego. This Human Resources Consulting
Project was conducted in fulfillment of the School of Business Senior Seminar in Human Resource Management.
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Executive Summary
From February 23, 2015 to May 13, 2015, SUNY Oswego students reviewed New York
Bus Sales Human Resource practices with special emphasis given to the degree that practices are
aligned with organizational goals. While most practices are effective, three areas of improvement
were identified: development of an online application system, an evolved employee wellness
program, and the option of an opt-out 401(k) enrollment system. Implementation suggestions are
offered.
Overview
The purpose of this project is for SUNY Oswego students to identify improvements in
Human Resource processes with a successful company by combining everything we have learned
over the four years in the Human Resource Management program and putting those topics to use
in a company consulting project. By meeting with the Human Resource department of a company
and offering suggestions on how to improve Human Resource practices, SUNY Oswego students
are earning valuable experience in the role of a consultant for Human Resource departments. In
return, the company is receiving ideas for improvement in their Human Resource processes.
New York Bus Sales is an organization founded in 1975 and headquartered at 7765
Lakeport Road, Chittenango, New York 13037. New York Bus Sales also has two other locations
located in Rochester and Ravena, New York. New York Bus Sales sells Blue Bird school buses to
school districts located in New York State. New York Bus Sales also offers a full-service repair
and parts department for the Blue Bird buses that they sell which is available year-round. The
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company hires school bus drivers in order to transport these buses back and forth whether it is for
distributing the sold buses to the buyers or whether it is to transport the buses back and forth for
repairs and/or parts. New York Bus Sales currently has 120 employees, 80 of which are full-time.
Not only does NY Bus Sales have typical office positions such as accounting, human resources,
and management, but it also offers positions in the painting, servicing, and parts departments. New
York Bus Sales is a family-owned company that is focused on not only customer satisfaction but
employee satisfaction by offering a large benefits program. The company is also safety-focused
for both employees and customers. Employees and visitors are required to wear safety vests and
glasses when in certain parts of the facility. Safety is so important to New York Bus Sales that
they even have a Safety Coordinator position. New York Bus Sales sells and services Blue Bird
school buses to school districts, so is concerned with safety of its customers and the children who
ride these buses every day to school. In order to keep them safe, New York Bus Sales has strict
standards in place in regards to the buses. The goals of New York Bus Sales center around
employee satisfaction, customer satisfaction (quality of product), and safety for both employees
and customers.
Information was collected by two separate visits to New York Bus Sales headquarters, by
interviewing the Human Resources Manager, and by reviewing the materials that was given to us
by the Human Resources Manager.
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Human Resource Practices
New York Bus Sales has an extremely strong benefits package that is offered to their
employees. In fact, 75% of benefits is paid by New York Bus Sales while only 25% of benefits is
paid by employees. The company also offers a strong tuition reimbursement plan. New York Bus
Sales has a strong safety program with a tool reimbursement plan and a safety incentive for offering
new ideas. The company also offers incentives for sales. The company offers company vehicles,
gas cards, E-Z passes and cell phones to school bus drivers so they are prepared for driving the
school buses for long distances. Employee recognition is also very important to the company, so
they offer clam bakes, free Thanksgiving turkeys, and free prizes. Lastly, the company offers an
aggressive compensation structure which is either above market or at market wages. New York
Bus Sales has a very strong Human Resource department whose practices are aligned with
company goals. That is, employee satisfaction, customer satisfaction (quality of product) and
safety for both employees and customers. Only three areas for improvement were identified. These
areas are addressed below.
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Improvement Area 1
One organizational goal this HR practice can be better aligned with is employee
satisfaction. Currently, in order to apply to New York Bus Sales, an applicant must send their
resume through email to the Human Resource Manager. Then the Human Resource Manager will
email the applicant back an application to the company (and a drivers application required by the
Department of Transportation if applicable), which the applicant would then return back to the
Human Resource Manager. We believe that there is an extra step to this process that can make the
application process to the company to be too lengthy. This not only can lose applicants along the
way, but could possibly end up decreasing employee satisfaction if hired with the long
application/hiring process. We believe that this process could be improved by an online application
system. Please refer to Appendix (1) in order to see a visual representation of our value chain. As
you can see by the value chain, implementing an online application system not only reaches an
organizational goal by increasing employee satisfaction but it also ends up cutting costs for the
organization and saves time for the Human Resource department. It does this by creating a quicker
application process which in turn increases employee satisfaction because of the quick application
process. Because we are cutting an entire step out of the application/hiring process, it also ends up
minimizing application costs.
Enforcing an online application process will allow ease and convenience, structure, and
security for the applicant. Candidates applying for a job online will not need to worry about filling
in error-free hard copy forms and spending money on postage to return them. There's also the
benefit of knowing an application has been safely received by a recruiter by receipt of confirmation
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at the end of the application process. An online application process allows an employer to provide
a more structured format for applicants. As opposed to inviting resumes and cover letters or issuing
pro form application forms, online application systems allow recruiters to ask targeted questions
and request evidence specific to the role. This makes it clear to potential candidates what is
expected of them and how they should complete the application process.
The main advantage of implementing an online application system is that it is cost
effective. Filling a position through newspaper classifieds, headhunters or internal personnel
departments can be time-consuming and costly; online applications can reduce the cost of hiring
considerably. Many online job classified sites are free or charge minimal fees for employers, or
you can create an application form through your own website. We did research on different
applicant tracking websites and Zoho is a top rated online application system with cheap prices.
Refer to Appendix (2) showing the approximate prices.
Online applications are also available worldwide. Newspapers and company
announcements tend to reach only local markets. Using an online application system you could
reach promising candidates who may be willing to relocate to Syracuse for the right job and they
could be more qualified for the position. Openings can easily be advertised and spread on the
Internet through job-posting sites, company websites, blogs and social networks.
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Improvement Area 2
One organizational goal this HR practice can be better aligned with is increased employee
satisfaction. Currently, the wellness program at New York Bus Sales includes a reduced price of
membership to the YMCA. This is done through the company paying part of the membership price,
the YMCA providing a discount of the membership price, and the employee paying the rest of the
membership price (if desired). The company also implemented a separate wellness program by
installing a vending machine that was originally designed to only offer healthy lunch/snack
options. We believe that these two wellness programs that the company offers can be improved.
Please refer to Appendix (3) in order to see a visual representation of our value chain. As you can
see by the value chain, implementing an improved employee wellness program not only reaches
an organizational goal by increasing employee satisfaction but it also ends up cutting costs for the
organization. By offering a free gym membership or healthier lunch and/or snack options,
employees will end up being more attentive and having higher morale which helps work get done
faster and more accurately. This ends up increasing employee health, loyalty and commitment
because it shows that NY Bus Sales is dedicated to increasing the health of their employees. In
terms of cost, having healthier employees also minimizes health insurance costs.
NY Bus Sales has a very well-rounded benefits program that they offer their employees.
Their benefits include medical, dental, life and voluntary term insurance, flexible spending
accounts, short term disability, and a 401(k) plan. For most companies health insurance costs take
up to 50% of their profits and recently costs have been climbing. Tax incentives are offered to
employers who implement workplace wellness programs. This is to encourage companies to
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motivate employees to participate and lead healthier lives. One study found that at least one-fourth
of incurred by working adults are attributed to changeable health risks, such as tobacco use, diet,
and lack of exercise (Tillman).
We believe implementing a wellness program for all employees would be extremely
valuable to your company. The wellness incentives that are already in place are a good place to
start, for example the discount for a gym membership at the YMCA should definitely remain. By
creating a more cohesive wellness program employees would feel more motivated to participate.
Setting monthly goals creates an incentive for employees to actually attend them gym and also
allows you to be able to quantify the usage of the program.
It was brought to our attention that a lot of the mechanics and bus drivers suffer from back
problems and other physical pains from either driving all day or being in difficult positions all day
servicing buses. This could hinder their performance and even their absenteeism. According to
World Economic Forum statistics companies that have implemented an effective wellness
incentive program have experience a return on investment of 755% in productivity. The rise in
productivity is due to many factors including lowering absenteeism and improving on-the-job
utilization (Welshhons).
Rewarding employees making good decisions in all areas of their lives such as healthy
work environment, eating habits, stress management, and finance management creates not just an
incentive to be active but also an incentive to live a healthy life all around. As you can see in
Appendix (4), the 2012 Aflac Work Forces Report, employees that are offered wellness programs
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compared to those that are not are more likely to have higher job satisfaction, feel happier with the
employer, and be more satisfied with their overall benefits (Tillman).
The biggest reason for implementing one of these programs is because it has the potential
to lower health care costs by about $700 per employee per year. A comprehensive analysis of 42
published studies of work site health promotion programs showed that companies that
implemented an effective wellness program realized significant cost reductions and financial
gains, including 28% reduction in sick days, 26% reduction in health costs, 30% reduction in
workers compensation and disability management claims, and $5.93 to $1 savings-to-cost ratio
(Tillman).
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Improvement Area 3
One organizational goal this HR practice can be better aligned with is increased employee
satisfaction. Currently, New York Bus Sales offers an opt-in option for 401(k) enrollment. We
believe that an opt-out/automatic enrollment system for 401(k) would be a better option for the
company. Please refer to Appendix (5) in order to see a visual representation of our value chain.
As you can see by the value chain, implementing an improved opt-out/automatic enrollment
system for 401(k) not only reaches an organizational goal by increasing employee satisfaction but
it also ends up cutting costs for the organization. By offering an opt-out/automatic enrollment
program, it ends up saving time in the new hire paperwork process. By automatically enrolling
employees, NY Bus Sales is giving off the impression that the company cares about the employees
future which increases employee loyalty and commitment. With increased loyalty and
commitment, there will be less turnover costs.
All studies of these plans show that this system will increase enrollment rates. This
automatic enrollment will take advantage of the status quo bias, where people put more weight
into their current situation and do not make the best choices if it would involve a change. (Choi,
2006/ Benartzi, 2007). Under the opt-in system employees who are not knowledgeable about the
long term benefits of retirement planning would often times not take the steps to set themselves
up for the future, this is a good way for companies to take care of their employees in the long term.
Having more people enrolled in a 401(k) plan will increase employee morale, as they are less likely
to be worried about their financial future.
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One reason that more employers have been favoring automatic is the Pension Protection
Act of 2006. Prior to the passage of this law automatic enrollment of employees was a particularly
risking move for employees. In the past employers who automatically enrolled their employees
were liable for any losses that incurred as a result of the automatic contributions. With the passage
of the act employers were able to relieve themselves of liability through the use of Qualified
Default Investment Alternative. These QDIAs allow employers to automatically enroll and set
the contribution of their employees while still enjoying the same fiduciary relief of those that have
employees opt-in to the plan. An explanation the requirements of these QDIAs can be found in
Appendix (6).
Graphs visually showing the popularity, structure and effect that automatic enrollment
plans has on enrollment can be found in Appendix (7).
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Summary and Conclusion
Throughout our time meeting with New York Bus Sales, we were very impressed with
their HR processes. However, we found 3 areas that had room for improvement. These areas
include implementing an online application system, improving the current wellness program, and
implementing an opt-out/automatic enrollment 401(k) system. We found that all three of these
improvements directly related to the goals of New York Bus Sales as a whole in the way of
employee satisfaction. We find that all three of these improvements are achievable and in the longrun will end up saving New York Bus Sales money and improving their employees performance,
job satisfaction, and quality of life.
If you need additional information regarding this project, please contact Dr. Barry A. Friedman at
(315) 312-6381 or barry.friedman@oswego.edu.
We want to thank NY Bus Sales for their support during this project.
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References
Benartzi, Shlomo and Richard H. Thaler (2007). "Heuristics and Biases in Retirement Savings
Behavior."Journal of Economic Perspectives, Summer 2007, v. 21, iss. 3, pp. 81-104
Choi, James J., David Laibson, and Brigitte C. Madrian. "Plan Design and 401(k) Savings
Outcomes." NBER Working Paper. N.p., May 2004. Web.
Tillman, A. The Impact of Wellness Programs on Americas Workforce.
The Institute for Healthcare Consumerism. Retrieved from
http://www.theihcc.com/en/media_center/editors_ picks/the-impact-of-wellness-programs-onamerica%E2%80%99s-workf_h2jeegra.html
Tillman, A. The Impact of Wellness Programs on Americas Workforce. The Institute for
Healthcare Consumerism. Retrieved from http://www.theihcc.com/en/media_center/editors_
picks/the-impact-of-wellness-programs-on-america%E2%80%99s-workf_h2jeegra.html
U.S. Chamber Highlights Benefits of Workplace Wellness Programs. (2009, April 1). Retrieved
May 6, 2015, from https://www.uschamber.com/press-release/us-chamber-highlights-benefitsworkplace-wellness-programs
United States Department of Labor, Default Investment Alternatives Under Participant-Directed
Individual Account Plans
http://www.dol.gov/ebsa/newsroom/fsdefaultoptionproposalrevision.html
Welshhons, L. How Employee Wellness Programs Can Generate Savings for Your Company.
Merit Resources. Retireved from http://www.meritresources.com/userdocs/materials/
Employee_Wellness_Initiatives_Merit.pdf
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Appendices
Appendix (1)
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Appendix (2)
From: https://www.zoho.com
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Appendix (3)
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Appendix (4)
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Appendix (5)
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Appendix (6)
According to the United States department of labor a QDIA must satisfy the following
requirements:
A QDIA may not impose financial penalties or otherwise restrict the ability of a
participant or beneficiary to transfer the investment from the qualified default
investment alternative to any other investment alternative available under the plan.
A QDIA must be either managed by an investment manager, or an investment
company registered under the Investment Company Act of 1940.
A QDIA must be diversified so as to minimize the risk of large losses.
A QDIA may not invest participant contributions directly in employer securities.
A QDIA may be:
o
Balanced fund; or
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Appendix (7)