Perry’s Ice Cream, owned and operated by the fourth generation of the Perry family, produces and distributes ice cream from Akron, New York, to markets in Pennsylvania, Ohio, New England and the Baltimore/Washington, DC, area.
The United Auto Workers Local 686, Unit 18, represents the workforce at Perry’s Ice Cream, which manufactures and prepares the product for distribution to customers in the mid-Atlantic.
Overland Resource Group was engaged prior to contract negotiations between the two parties to facilitate successful talks that would enable them to establish a productive environment with collaborative structures and processes at its foundation.
THE CHALLENGE
Following the unionization of Perry employees and ratification of its first contract, an adversarial relationship between labor and management developed that created an environment charged with negativity, divisiveness, poor quality performance, high turnover, and absenteeism. Prior to beginning its second round of contract talks, ORG was charged with helping both sides craft a more productive relationship and establish a negotiating process that would yield a progressive win-win contractual agreement. It was the hope of both parties that this foundation for a collaborative process would provide the framework and structure to sustain a mutually-beneficial working environment long after contract negotiations were complete. Both parties formalized that mutual commitment in writing,
including it in the preamble to the labor contract they negotiated. The preamble stated, “Through joint leadership, the United Auto Workers and Perry’s Ice Cream are committed to a high quality of work life that is built on a healthy, trusting and collaborative working relationship committed to achieving business and individual success and fulfillment.”
The creation of the preamble was one of the results of pre-negotiation meetings that established ground rules to govern how the labor and management leaders conducted themselves in the discussions.
THE STRATEGY
Overland Resource Group was not retained to engage in negotiation or mediation, but rather to provide on-going counsel to keep the focus on shared interests, instead of on historical “baggage” or predetermined solutions or positions. In doing so, ORG helped the parties learn and practice collaborative behaviors that would be critical to sustaining these working relationships and to modeling those behaviors to others throughout the organization.
THE TACTICS
ORG convened discussions prior to formal negotiation meetings to help the parties identify and anticipate problems that could arise and threaten their nascent collaborative efforts. These forecasting exercises enabled the parties to proactively discuss how they would prevent these “derailers.”
ORG assisted the leaders in developing a 10-member Joint Operations Leadership Team (JOLT) and worked with the team to build collaboration and employee involvement in the business at every level. The bi-weekly JOLT
meetings also provided an important opportunity for the leaders to review the performance of the operation and to share business information.
Perry’s Ice Cream adopted an organizational structure that did not include the traditional supervisor role. Instead, leaders and team members from the hourly ranks ran the operation and made decisions at every level possible. Facilitators worked to provide tools and resources so the employees could focus on successfully making and distributing ice cream every day.
THE RESULTS
Labor and management leaders credit the collaborative process with helping them achieve the following measurable results over a three-year period:
Safety improvement
LOST TIME INJURIES DECREASED BY
60%
SERIOUS INJURIES DECREASED BY
77%
Quality improvement
CONSUMER COMPLAINT RATE DECREASED BY
47%
CONSUMER COMPLIMENT RATE INCREASED BY
63%
Work life improvement
GRIEVANCES WERE REDUCED BY BETTER THAN
90%
AND BECAME MORE STRATEGIC IN NATURE
ABSENTEEISM REDUCED BY
30%
Cost improvement
MATERIAL USAGE IMPROVED BY
35%
In terms of costly employee turnover rates, leaders credited a jointly-developed process for filling job vacancies as the driver behind a 67% reduction in turnover among UAW-represented employees and an even greater turnover reduction of 87% among those in skilled craft positions. Candidates for union jobs began to be selected based on qualification, with seniority used as an additional determining factor. In fact, the process of jointly developing selection criteria and jointly interviewing and selecting team members to fill various job openings was so successful, the process was replicated for filling management positions.
ADDITIONAL EVIDENCE OF SUCCESS
In addition to the improvements in production and employee morale, Perry’s communications process evolved as the union-management relationship matured. Management originally ran Town Hall meetings with employees, then members of JOLT began conducting the meetings. In the following year, team members began assuming full participatory roles for the meetings, including setting
the agenda, delivering key messages, and presenting team projects and their results.
The operations performance improvements made possible through increased team member involvement paid off for employees, who received their first Sharing in Operations Success (SOS) incentive program payout that next year.
REAL PEOPLE. REAL RESULTS.
“We wanted to move away from the adversarial approach and old mentality that, unless you’re fighting with each other, you’re not doing your job. We wanted to work on fostering a relationship that’s not about winning or losing. Instead, it’s about having common goals and creating a winning environment. We wanted to get to the place where, instead of fighting over how to divide the pie, we could be having productive discussions about how to expand the pie together.”
David Merrill, VP Human Resources, Perry’s Ice Cream
KEYS TO SUCCESS
LEADERSHIP VISION
Labor and management leaders were willing to pursue an alternative approach to their previously adversarial approach to negotiations.
COMMITMENT
Words matched actions. The preamble in the collective bargaining agreement clearly stated what leaders wanted to accomplish. The actions they took (changes to organizational structure, increased sharing of business information, and the introduction of a performance pay plan) showed they meant it.
FOCUS ON RESULTS
Perry’s and the UAW didn’t enter into their collaborative work merely to “play nice in the sandbox.” They appropriately used collaborative processes and increased employee involvement to drive business results. They understood that operating at optimum performance levels was the best way to keep the facility competitive so that management, the union, and employees could all reap the rewards.
REAL PEOPLE. REAL RESULTS.
“Many companies and the labor groups that represent their employees find themselves on the verge of bankruptcy or extinction because they have perfected the art of war at the expense of success. In truth, companies and unions are far more likely to achieve their goals as allies than as enemies.”
