Employees who cannot read and write very well cost their employees a lot of money.
In a time when executives and business leaders are looking for ways to manage and contain costs, it’s important for them to focus on identifying and controlling hidden costs.
One of the major contributors to hidden costs is functional illiteracy in the workplace. According to Wikipedia, functional illiteracy consists of reading and writing skills that are inadequate “to manage daily living and employment tasks that require reading skills beyond a basic level”.
When people are unable to accurately comprehend and make sense of what they’re reading, their illiteracy results in additional costs in the form of production problems, hampered production, or an increase in costs when implementing new systems or learning how to operate new machinery.
Costs are not quantified in financial terms only. There are hidden costs like lost time, wastage and lowered productivity that cause companies to quietly haemorrhage money without anyone noticing. It’s therefore strategically important for these “little mouths” that quietly eat away at earnings and profits to be identified and dealt with.
Here are just three ways in which functional illiteracy affects profitability.
Safety can be compromised
When people don’t really understand why they’re doing a certain job, they often also don’t fully appreciate the safety hazards associated with that job. For example, they don’t fully appreciate the implications and consequences of doing or not doing something. We’ve had several clients who have nearly had serious explosions in their warehouses or factories because of workers that don’t really understand the implications of not closing something, or not putting something back in the same place. These may seem very basic things but, if they don’t understand the hazards of the environment in which they’re working or of the products they’re working with, there could be a major cost in terms of human life.
Stock taking is not done correctly
A normal stock taking process in a company is usually a very difficult process because it is an unpleasant job. And, because nobody wants to do it, it’s therefore often given to a labour force that is not fully functionally literate, and these are the people who can’t count very well, if at all. So it often ends in a mess, resulting in inaccurate records and sales.
Trucks could be overloaded or not loaded to capacity
When the loading of trucks is conducted by functionally illiterate workers, a safety hazard is created in the case of a truck being overloaded, which endangers not only the driver but also any innocent members of the public who might be injured or killed in the case of the driver losing control of the overloaded vehicle. This could result in costly legal action for the company. There is also the cost of additional wear and tear on the vehicle.
On the other hand, when trucks are not loaded to capacity, the company experiences losses from insufficient quantities being delivered, necessitating additional delivery costs.
What companies should do
The first thing companies should understand is that they can’t accept employees’ qualifications at face value. Just because someone claims to have a certain level of education, it doesn’t mean they have the necessary skills that should have been acquired by someone with that particular qualification.
The second step companies should take is to take responsibility for the literacy levels of their employees. By doing this, they can be sure that every employee has the necessary literacy skills to do the job for which they have been hired and that they will create value for the company instead of contribute to those hidden costs.
MARINDA CLACK is an Expert Training and Development Advisor at Triple E Training.
