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How Little Debbie used predictive analytics to survive snack industry shakeup

Stephanie Overby | March 20, 2014
McKee Foods, maker of Little Debbie snacks, turned to Workday's cloud-based human capital management and payroll software. The switch helped it analyze data for decision-making, save money and better survive a snack industry shakeup.

McKee Foods has 100 percent of its employees on direct deposit, distributing more than 350,000 paychecks per year through weekly payroll cycles. So Newsome delayed the rollout a total of two years until he could ensure the payroll functionality was sufficiently robust.

The delay, however, proved beneficial. It gave McKee's 800 pilot users time to "play in the sandbox" developing new business processes, said Newsome. "By the time we went to implementation, it was already second nature." Ultimately the new system saved McKee $1.5 million in costs and reduced HR headcount by two-and-a-half full-time employees.

HR Analytics Guide Tough Decisions
The timing of the Workday rollout proved especially advantageous as McKee Foods faced hard times. "We're a very mature company that's been around for many decades, and it was easy for us for a long time," says Newsome. "But as the marketplace tightened up, things got tough. And we recognized that to stay ahead of our competitors, we'd have to tighten up in a lot of places."

Like others in the snack industry, the company was getting squeezed by the push toward healthier eating combined with a weak economy. Company leaders knew that layoffs would be necessary but wanted to be smart about the staffing cuts. They "asked us to help them identify, based on the reduction that needed to take place, where we could make those cuts without impacting the output of the organization," Newsome says.

"As they were dealing with the reduction in force, our managers had that real-time data at their fingertips to help them figure out what they needed to do and where they were in meeting their goals," vNewsome says.

With the old HR system, the company had made what Newsome calls a "strategic error" by allowing multiple users to build their own reports, which lead to various versions of HR truths. Not so with the Workday system. Now company leaders and managers have full confidence in the accuracy of HR data and reports.

When Hostess went out of business, the new system enabled McKee Foods to ramp up hiring to meet the increased demand resulting from a key competitor exiting the market. Hiring times have decreased from 90 to 45 days, depending on the level of the position.

Predicting Future Workforce Needs

Newsome and his team are now in the early stages of evaluating predictive HR analytics capabilities. They spent a year surveying company leaders about what would be most useful in their day-to-day decision-making and created a workforce analytics team.

It's the real fun part, says Newsome, because it will have a much more strategic impact on the organization that backward-looking reporting. The only difficult part is figuring out where to start. "It's the same struggle I've had for the past 30 years in HR," Newsome says.


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