RUBIO S COASTAL GRILL

Transcription

1 R O I C A S E S T U D Y P R O G R A M : H U M A N C A P I T A L M A N A G E M E N T D O C U M E N T R A U G U S T CERIDIAN DAYFORCE RUBIO S COASTAL GRILL A N A L Y S T S Barbara Z. Peck, Brent Skinner T H E B O T T O M L I N E Rubio s Coastal Grill deployed Ceridian Dayforce human capital management (HCM) application to streamline and automate HR processes with a single-source cloud application. The existing manual HR processes for Rubio s could not keep up with the company s continued expansion and it needed a solution that would support its growth. Nucleus found that the Ceridian Dayforce solution enabled Rubio s to reduce labor costs, eliminate expenses related to manual, paper based processes, and improve productivity and increase transparency with standardized operating procedures across the entire enterprise ROI: 148% Payback: 9.6 months Average annual benefit: $1,827,699 T H E C O M P A N Y A coastal-inspired casual dining restaurant chain specializing in Mexican-inspired seafood, Rubio s Coastal Grill is based in Carlsbad, California. The restaurant operates more than 200 restaurants in Arizona, California, Colorado, Florida, Nevada, and Utah. Founded in 1983 by Ralph Rubio with the Original Fish Taco recipe, the company returned to private status in Nucleus Research Inc. 100 State Street Boston, MA Phone:

2 T H E C H A L L E N G E Rubio s sought to overcome the limitations of the HCM application being used at that time. It needed to seamlessly migrate from a manual, paper-based HR system to an efficient cloud-based application, with minimal disruption to the operation. Cost : Benefit Ratio 1 : 2.7 The restaurant industry has always faced the challenge of employee turnover and retention, as well as scheduling and time tracking. Rubio s needed a solution that would eliminate the existing paper-based system, provide self-service portals for employees, deliver accurate and actionable analytics, and manage the complexity of hourly team members in many different locations. T H E S T R A T E G Y The company examined several solutions including Ceridian Dayforce, Ultimate UltiPro, and Workday, before selecting Ceridian. The search began in January 2015 and deployment began in early Rubio s determined that the single source cloud based application from Ceridian was the most robust and efficient solution for their environment. TYPES OF BENEFITS Direct 64% 36% Indirect The company started the deployment in 2016, taking approximately eleven months from start to finish. Approximately 40 selected managers received training from Ceridian over a two-day period, and the remaining 310 restaurant managers received user training delivered by an internal team at 17 different locations. K E Y B E N E F I T A R E A S The automated and streamlined Dayforce solution enabled Rubio s to eliminate manual processing and speed information flow. Key benefits of the project include: Cost savings. The functionality of Dayforce has enabled the company to eliminate several costs associated with separate software for the preparation of Copyright 2017 Nucleus Research, Inc. Reproduction in whole or in part without written permission is prohibited. 2

3 W-2 tax forms and talent acquisition, all included in the Dayforce solution. By eliminating manual processing and the paper costs associated, the company markedly reduced the incidence of redundant information and misfiled documents. The single source solution has also reduced data entry times and the risk of human error while entering information. Avoided costs. Automation and increased productivity have avoided the need for additional hires in payroll and administration. Rubio s anticipated the hiring of an additional payroll clerk and an additional clerical administrator to manage the same number of employees currently working. CUMULATIVE NET BENEFIT 5,483,096 2,566, ,390 Year 1 Year 2 Year 3 Employee self-service. The Dayforce application has improved employee access to personal data, scheduling, shift swapping, and payroll information. Due to the improved accuracy of the data the employees can access, they have fewer questions for HR and store managers, and spend less time on HR issues. Improved productivity. Both general managers and assistant managers can focus their time on value added activities such as customer service and increasing sales with the time saved with the automation of HR services. K E Y C O S T A R E A S Costs of the project included software license fees, tablet purchases for each store, personnel time to implement and support the application, consulting fees, and user training time. The software subscription and purchase of tablets for each store represented nearly 60 percent of the prestart expenses. Copyright 2017 Nucleus Research, Inc. Reproduction in whole or in part without written permission is prohibited. 3

4 NET CASH FLOWS 2,917,085 1,993,622 1,987,622 (1,415,232) Initial Year 1 Year 2 Year 3 L E S S O N S L E A R N E D The complexity of managing and monitoring hourly staff in a variety of locations requires an HR platform that combines scalable functionality with ease of use for staff. Additionally, the company s commitment to training and significant change management efforts helped successfully roll out the system. C A L C U L A T I N G T H E R O I To calculate Rubio s total investment in Ceridian Dayforce, Nucleus quantified the initial and ongoing costs of software subscription fees, tablet purchases, and personnel time to implement and support the application and employee training time over a 3-year period. Direct benefits quantified included the avoided hiring of additional payroll administrators and processors, reduction of W-2 production expenses, reduction of manual paper expenses, elimination of external talent acquisition costs, and the elimination of a license for the legacy software. The indirect benefits quantified included productivity gains based on the average annual fully loaded cost of an employee using a correction factor to account for the inefficient transfer between time saved and additional time worked. Not quantified were the future efficiencies and savings that the employer expects to experience as it eventually deploys additional functionality found in the Dayforce application. Copyright 2017 Nucleus Research, Inc. Reproduction in whole or in part without written permission is prohibited. 4

5 FINANCIAL ANALYSIS Rubio's Coastal Grill Annual ROI: 148% Payback period: 0.8 years BENEFITS Pre-start Year 1 Year 2 Year 3 Direct 0 1,860,558 1,860,558 1,860,558 Indirect 0 1,056,527 1,056,527 1,056,527 Total per period 0 2,917,085 2,917,085 2,917,085 COSTS - CAPITALIZED ASSETS Pre-start Year 1 Year 2 Year 3 Software Hardware 200, Project consulting and personnel Total per period 200, COSTS - DEPRECIATION SCHEDULE Pre-start Year 1 Year 2 Year 3 Software Hardware 0 40,000 40,000 40,000 Project consulting and personnel Total per period 0 40,000 40,000 40,000 COSTS - EXPENSED Pre-start Year 1 Year 2 Year 3 Software 594, , ,939 0 Hardware Consulting 110, Personnel 398, , ,000 0 Training 92,592 48,523 48,523 0 Other 19, Total per period 1,215, , ,462 0 FINANCIAL ANALYSIS Results Year 1 Year 2 Year 3 All government taxes 45% Cost of capital 7.0% Net cash flow before taxes (1,415,232) 1,993,622 1,987,622 2,917,085 Net cash flow after taxes (868,378) 1,114,492 1,111,192 1,622,397 Annual ROI - direct and indirect benefits 128% 128% 148% Annual ROI - direct benefits only 61% 61% 81% Net Present Value (NPV) (868,378) 173,204 1,143,762 2,468,121 Payback period 0.8 years Average Annual Cost of Ownership 1,415,232 2,338,695 1,634,079 1,089,386 3-Year IRR 123% 123% All calculations are based on Nucleus Research's independent analysis of the expected costs and benefits associated with the solution. Copyright 2017 Nucleus Research, Inc. Reproduction in whole or part without written permission is prohibited. Page 6