Case Study: FedEx Leverages Technology to Drive Best Practices in Integrated Absence Management

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FedEx Leverages Technology to Drive Best Practices in Integrated Absence Management

Introduction

This study about a program at FedEx covers one of the foundational needs for a successful absence and disability management initiative. Everybody knows employees need a streamlined process to expedite their return to work from an absence. Absence managers need the same type of support for their end of the process, too. Even well-designed initiatives can stumble when absence managers lack the system support to consistently follow company policy and comply with all appropriate regulations. FedEx worked with its data vendor to make the process as simple as possible for its network of regional absence managers, just as it is for employees.

The Challenge

For the better part of two decades, FedEx’s Human Capital Management Program (HCMP) has provided a blueprint for managing employee health, absence and productivity. As the program has expanded, however, approaches for managing employee absence became as varied as the 35 HCMP managers responsible for managing those absences.

The result was an increase in data errors, an inability to identify absence trends, inefficiency in FedEx’s processes, and difficulty in ensuring the consistent execution of best practices across an organization that spans the United States.

Approach and Outcomes

Program managers at FedEx decided that by leveraging technology, they could tie the increasingly disparate elements of their HCMP program back together. In short, FedEx sought a solution that would:

  • Incorporate its best practices for managing employee absence.
  • Streamline workflows by integrating task management, document management, and letter creation capabilities.
  • Improve communication among HCMP managers and the employees they are responsible for assisting.
  • Accommodate its lengthy list of leave types and programs, including medical leaves, short and long-term disability, workers’ compensation, FMLA, personal leave, bonding and adoption leave, return-to-work and accommodation programs.

FedEx turned to OCI, its 20-year partner for data aggregation, to build its Human Capital Management Administration System (HCMAS). The system went live in October, 2006. Though the system represents a significant operational shift and is still relatively new at FedEx, the early response from HCMP managers has been positive.

Planned next steps include linking other FedEx business entities, such as Kinko’s, to the system, as well as the development of management reporting to monitor absence trends and compliance with best practices.
In the Trenches

FedEx Express (the FedEx flagship unit) is the world’s largest express delivery business, according to Hoovers.com. If its drivers, pilots and other essential staff are not at work, the company’s value promise is jeopardized. Senior managers have therefore been very interested in understanding the company’s overall absence trends, as well as the impact of those trends on productivity. Employee absence was historically difficult to quantify, however, particularly given the number of absence programs and the varying ways in which absence was managed across the company.

“There was no uniformity,” said Gus Lauer, general manager of disability, work/life and HCMP at FedEx. “Some managers were working with manual notes, others were using spreadsheets, and others were using Outlook to manage absences.”

That meant crucial absence data were unavailable, error-prone, or incomplete. Furthermore, there was no way for the company to ensure that its best practices were being consistently implemented, or that it was delivering on its commitment to assist employees in their expeditious return to work.

From the beginning, FedEx knew there were no easy answers. The company’s solution to those issues carried with it the classic challenge inherent in applying technology solutions to business problems: helping managers with well-developed habits see the value in the system, and then persuading them to use it. Faced with these challenges, FedEx began by recognizing that the characteristics of its programs were unique.

“We chose to build a customized system because the complexity and unique nature of our HCMP program did not lend itself to an off-the-shelf absence management solution,” Lauer said. Since the system was to be customized, program managers included the user community in its design, seeking and integrating their input whenever possible. They further worked to flatten the learning curve and increase acceptance among users by sponsoring on-site and online training sessions.

Additionally, FedEx wanted to ensure ease-of-use, while continuing to leverage its existing HR systems, so the team designed the absence management solution to integrate smoothly with existing systems. That means, for example, that HCMP managers login each day to the HRIS system they are familiar with, and then link directly to the HCMAS application without switching sites or entering additional usernames and passwords.

Since the system went live in October 2006, HCMP managers have been able to capture data in real-time and manage absences of any type from a single system. Workflows have been streamlined through the use of the system’s task management and standard letter creation tools. The system’s FMLA calculator has simplified the administration of FML leaves. And communications with all constituents—other HCMP managers, employees, and providers—are tracked within the system. The early results suggest that FedEx is succeeding in leveraging its technology investment to drive the consistent implementation of best practices for managing absence across its organization. Ultimately, that will mean improved outcomes and more effective cost control.

“The managers who had developed their own absence management methods are embracing the system,” Lauer said. “One of our goals was, to the extent possible, to go to paperless operations. And some of our managers have accomplished that.”

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