Case Study: The ROI of Certification at Hal-Com

Hal-Com is one of the premier technology services providers in Cleveland, OH, offering a range of IT solutions and services. Poor hiring decisions created two problems for Hal-Com: high employee turnover rates and reduced customer satisfaction. In Fall 2001, Hal-Com implemented a new training and certification program for employees, mandating that each employee pass six certifications. CompTIA commissioned Kotler Marketing Group to conduct a case study.

High Turnover, Reduced Customer Satisfaction Lead to Added Costs

When Hal-Com hired a new employee, a significant amount of time had to be spent identifying and interviewing promising candidates. Once a new employee was on board, there was a significant ramp-up period. For two weeks, each new hire was matched up with an experienced technician. During this time, the employee was paid but Hal-Com could not bill clients for their time. At the same time, clients grew dissatisfied if technicians did not display adequate knowledge and skills. New technicians inconvenienced clients because they had to spend time acclimating the new person to the job site.

Training, Certification Plays Central Role in Solving Problems

Hal-Com now requires all employees to pass six certifications. After the employee is hired, they spend four weeks studying and training. Hal-Com provides 24-hour access to computer-based training materials in a lab and hardware and software for experimentation and practice. Hal-Com also pays for as-needed classroom training for employees.

Results

• Employee turnover has dropped from 50 percent to 10 percent, leading to reductions in management time spent interviewing candidates and on-the-job training for new hires.
• Client turnover has dropped from 20 percent per year three years ago to 5 percent today. Hal-Com now can spend more time developing new accounts instead of replacing lost business
• Senior technician productivity has increased because senior staff no longer spend as much time answering questions from junior techs.
• The total annual savings from reduced hiring costs are calculated to be $6,075 per year.
• The total annual savings for the new hire ramp-up period is $4,900 per year
• Client retention has improved from 85 percent to 95 percent, with a total profit of $15,000 per year
• For an investment of $15,000 to train and certify 1.5 employees, Hal-Com received a net profit of $10,975, an ROI of 73 percent in a 6.9 month payback period.