W7_Hamed _ How to Improve the Graduate Development Program at OPWP

Problem Statement

Every year, OPWP hires new graduates to fill in available positions at multiple departments such as planning, development, operation ..etc. After fresh graduates have been hired, their next challenge is to complete an intensive 12 months graduate development program (GDP). The current strategic development for new fresh graduates is to spend 1-2 months at each department to learn key functions and activities. Because of the long period of the current GDP which tend to be not beneficial for new graduates, this blog will examine different other training development strategies using the Pareto Priority Index.

Feasible Alternatives

There are three training alternatives as to which the GDP should rely on:

Option 1: 12 month in which 6 months are devoted for different departments and 6 months for the mother department.
Option 2: 6 month for mother department (Direct Hire)
Option 3: 2 months for multiple departments followed by 6 months for mother department.


Outcomes of the Alternatives

The Pareto Priority Index (PPI) will be used to compare the feasible alternatives and to determine the best option. This method is used to carry out a cost-benefit analysis to compare the available options of an organization. This analysis depends on the following inputs of the Pareto Priority Index (PPI):
  • Cost (OMR): this is the cost factor of implementing the alternative. For our case study the cost factor consists of two elements: salaries of new graduates and the costs of training such as car rental, hotels …etc.
  • Saving (OMR): For our case, the saving factor is the return on investment. The expected added value that new graduates would deliver to the company after completing the GDP.
  • Time of completion (month): the time required to complete the GDP.
  • Probability of success: this factor represents the likelihood of success assuming that all new graduates completed their GDP successfully, taking into account assessments done by department directors and expectations.

Selection Criteria

The feasible alternatives will be compared against the inputs from the Pareto Priority Index using the following mathematical equation: 

Pareto Priority Index = (Saving * Probability of Success) / ( Cost * Time of implementation)   (1)
  
The selection criteria will be based on the result of PPI calculations. The alternative with the highest PPI will be considered for the GDP. Overall, options with greater cost saving and higher likelihood of success will have higher PPI number than other options with greater implementation cost and time.

Analysis and Comparison of the Feasible Alternatives

Table 1 summaries each alternative with proposed figures of the PPI inputs. These numbers assumes that five new graduates were selected for the GDP.

Alternative
GDP Period (month)
Cost (OMR)
Likelihood of Success**
Saving (OMR)*

Option 1

12
Salaries: 12 *5* 800 = 48000
Training Cost: 3000
Total : 51000

60 %

12* 5000 = 60000

Option 2

6
Salaries: 6 *5* 800 = 24000
Training Cost= 1000
Total: 25000
80 %

6*6000 = 36000

Option 3

8
Salaries: 8*5* 800 = 23000
Training Cost= 1500
Total: 24500
90 %

8*6000 = 48000
**Note: this depends on factors such as the probability of the new employee to continue on the GDP, the salary and other factors.                                                                                                                                                              * Note: This saving assumes that in case no graduates were to be hired, the company will depend on procuring external consultants, assuming an average monthly lump sum of 6000 OMR/team.

Calculating PPI using equation (1):

Option
Time (month)
Cost (OMR)
Likelihood
Saving (OMR)
PPI
Option 1
12
51000
60 %
60000
      0.06
Option 2
6
25000
80 %
36000
0.19
Option 3
8
24500
90 %
48000
0.22


Selection of the Best Alternative:

Results from PPI calculations indicated that option 3, which is a GDP program of 8 months including 2 months rotation between key departments and 6 months to be spent at the mother department is the best GDP alternative. Logically, the new graduate will focus mostly on the mother department with having the opportunity to come across other departments at OPWP.  A period of 8 months seems to be reasonable. The second option a direct hire to the mother department with a GDP of 6 months.

How to Monitor the GDP for future Graduates:

Because new employees represent the future of the corporation, it is crucial to monitor their performance during the GDP and how to improve the existing training strategy. Such a technique could be easily implemented to determine the best alternative and to bring a high return on investment to the company. This paper could initiate an internal project to determine those PPI factors and come up with a better training program for fresh graduates. Although the longer the GDP more departments are being involved in the training, sometimes fresh graduates tend to have clear set of goals and spending time at irrelevant departments is not always recommended.


References

1) Case Study: Pareto Priority Index. (2017, February 27). Six Sigma Study Guide. Retrieved from http://sixsigmastudyguide.com/pareto-priority-index-case-study/

2) Munk. J. (2014, July 8). The Six Sigma Approach to Project Selection. Retrieved from http://www.sixsigmadaily.com/the-six-sigma-approach-to-project-selection/

3) Nath, I. How Graduate Development Programs Can Help Develop Your Career. Talent Egg. Retrieved from https://talentegg.ca/incubator/2012/06/29/graduate-development-programs-develop-career/

 





Comments

  1. Very interesting case study Hamed. Why not use the same problem but this time apply Benefit : Cost Analysis but include the INTANGIBLE benefits and costs?

    The reason I suggest this is because I don't recall seeing PPI on any of the PMI Exams but I do know you will be getting 1 or 2 questions on Benefit : Cost Analysis.

    BR,
    Dr. PDG, Bali, Indonesia

    ReplyDelete

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