Data Analytics Assignment #2 (based on chapters 1 & 2) Two organizations were at
ID: 2813373 • Letter: D
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Data Analytics Assignment #2 (based on chapters 1 & 2) Two organizations were attempting to reduce absenteeism. They implemented the following solutions: Organization 1: Offer healthy snacks in the vending machines and free fruit and veggie trays every MWF This will cost the organization $5,000 per calendar year. Organization 2: Offer employees reimbursement for their gym membership fees up to $75 per month. This could potentially cost the organization $100,000 per calendar year if all employees take advantage of the program. Assume that both options when implemented resulted in a 5% reduction in absenteeism in the same calendar year Assume that organization 2's strategy only yielded a 2% reduction in absenteeism, would the investment still be worth it, in your opinion? (please use some form of quantitative analysis to justify your opinion) 3)Explanation / Answer
So here if we look into Organization 2's plan, they are offering its employees $75 per month of Gym membership reimbursement which is turning to abount $900 (75*12) reimbursement per year for an employee, and the company is expecting this is will cost them about $100,000 in a year. So, we can estimate the total work force strength of the company to be (100,000/900) which will be about 111 employees.
Suppose now these 111 employees working for 8 hours per day for 20 days in a month is equivalent to 160 hours per month per employee and when we do it yearly, it will turn in to 160*12 i.e. 1920 hours per year per employee and for the whole organization it is getting close to 111*1920 i.e. 213,120 hours.
So, this organization annually takes 213,120 hours of work from its employees if all the employees works for all the days.
Right now we dont have the data for earlier percentage of abseenteeism to get the actual hours of work the company is having.
But suppose if we consider this figure only. With the reduction in abseenteesim of 2%, the company is able to extract 213,120*2% i.e. about 4,262 hours of extra work from its employees.
So, by incurring $100,000 the company is getting 4,262 hours of extra work getting done which means the company is incurring about $23.5 per hour of extra work.
If by incurring this $23.5 per hour, the company is making profit of more than $23.5, this investment is worthful for the company.
Hope i am able to answer your question :-)
The bottom line is we the company expects to have an incremental profit of more than $100,000 by reducing the absenteeism by 2% thi strategy is worthful.
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