A privately held, family-run company relies on trust—the trust of its customers, its employees, and its suppliers and partners. The trust between McKee Foods and Workday has led to an extraordinary ROI for McKee Foods and an appreciative, strategic customer for Workday.
In 2006, when McKee Foods and Workday began to talk, McKee Foods was ready to move away from its previous HR system, then 14 years old. With each upgrade, the system had become more unwieldy and expensive. The cost and complexity of the upgrades had become unmanageable. McKee Foods didn't have the IT support or HR bandwidth to manage the upgrades in-house, which meant bringing in consultants—and adding more expense. It was time for a change.
"Upgrades were a huge factor for us," said Mark Newsome, senior corporate HR manager for McKee Foods. "But also the maintenance of data on your own servers, and using DBAs to keep up with all of that, and all the hardware that goes with it."
"I'll confess," he continued. "When we went live with Workday, I didn't really believe that we wouldn't have to pay for updates. So I saved money in my next year's budget to handle the three or four updates that I thought we would have in that first year."
"And I'm here to say that we have spent zero dollars on updates. Zero. And we spend three to five days testing the product three times a year. Three weeks versus nine months, zero dollars versus hundreds of thousands of dollars—that speaks for itself. There's your ROI."
In addition to achieving a positive ROI for their initial implementation in two years, McKee Foods is seeing other gains they didn't predict, such as reduction in headcount. "Previously, in addition to the dollar savings on upgrades and hardware costs, members of my staff and the IT staff and payroll would have to pull away from their normal jobs to do this," Newsome remarked. "It's just a complete time-waster. Now we don't do any of that."
What can McKee Foods accomplish now that it couldn't do before? The list is extensive, according to Newsome.
"Before, we would never have been able to implement our performance process online, for example," he said. "Think about it—performance reviews, benefits administration, ease of payroll, processing transfers, promotions, and pay changes in the system automatically instead of using paper-based systems. All of those have gained us so much value. Not only is it an ROI, but the productivity gains in the organization have been substantial. And it's not just for HR. Managers no longer have to fill out paperwork. Many times, it's just a matter of hitting an approval button."
With Workday data at their fingertips, McKee Foods' leaders can see what's going on in their organization more clearly. "The data is showing us that sometimes we've got headcount in the wrong places," Newsome said. "Or the wrong person would get a notification of a process, and we would discover errors in the reporting structure. But with Workday's focus on business intelligence, we don't have to utilize a third-party system to build that out. This really has long-term value, especially when you start talking about realtime, actionable insight into the workforce," he said.
"Managers now can look at what's happening in their organization and see some of the same information that we have always seen and shared with them before. Only it's at their fingertips. And I think that's probably the biggest, most powerful change."
A recent example is McKee Foods' first performance review using Workday, moving from a paper-based process to an online process with built-in workflow. Managers could follow the progress of employees through the process, find out when they finished and whether the supervisor had approved it—all the way to the vice president. "It would have taken HR a lot of coddling to get that done in the past," Newsome said.
What makes McKee Foods an exceptional customer for Workday? McKee Foods was a strategic design partner that helped Workday develop its payroll solution, now one of its most sought-after products.
As Newsome tells it, "When we signed our contract, we agreed to help in the design of payroll. We wanted to do the whole thing at once; we just didn't want to try to implement something piecemeal. And being involved in the development of the U.S. payroll solution was extremely inviting."
Newsome was impressed that Workday asked for their help with the payroll application. Workday went on site at McKee Foods to observe their payroll operations and gain detailed knowledge about their requirements. "It was such a huge differentiator for us," he said. "Workday didn't just try to figure this out by themselves. They used a real-life company who really had to use the payroll product."
Now, with manager and employee self-service, payroll takes much less time and money to run. Payroll specialists are relieved of the routine, transactional work they used to do. Paper-based processes have been replaced by automated, online systems that are much more accurate. For example, with thousands of paychecks to deliver each year, McKee Foods can now deliver pay slips electronically, saving money and resources, and the same business processes for HR and payroll can be used throughout McKee Foods' entire operation. Additionally, McKee also gets U.S. tax updates automatically at no additional charge with no extra effort on their part—another major benefit of leveraging a SaaS model for payroll.
"It has improved productivity considerably," Newsome observed.
An essential principle within McKee Foods is to value and respect people, part of its mandate as a family-owned company that values people and their contribution to the business. How does Workday support this principle? "Trusting people to get their work done in the system, and doing it right the first time…that's part of who we are. It's part of our DNA," Newsome said.
"It's different being a privately held organization. It's even more different being a family-run organization," he emphasized. "It takes, from my perspective, really strong relationships, people trusting that you're going to do your homework. In fact, the Workday project was a collaboration between our IT director and me. We literally led the charge together."
Finally, Newsome sees Workday as providing an edge in a highly competitive industry. Since Workday updates its product three times a year, "That's what will help us have a competitive advantage in people processes," he said.
"Anytime that we can reduce cost and complexity, anytime that we can be more efficient at what we're doing and increase productivity in how we're doing our work, there is an impact," he observed. "And if every department is using Workday to help them reduce costs, it's making us far more competitive."
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