In a few of my recent blog entries, I have addressed the concept of looking inside your organization and doing the “right thing”. I have written at length about how now is the time to recover properly. Now is the time to scrutinize the “right way” to analyze and strategize your customer service. We need to address today, the right way of forecasting from a centralized point of view.
Well, a funny thing happened on the way to the old keyboard. One of my colleagues here at LSI spoke up and challenged me to describe what the “right way” really is when it comes to optimizing the workforce. Needless to say, he is no longer with the company… (Just kidding). This individual made a very good point that although I assume retailers know what the “right way” is regarding workforce optimization, and for some reason they are just ignoring doing so, perhaps that is not so.
Well, that is very astute advice. Maybe there are individuals out there that do not grasp the whole of workforce optimization. Perhaps we have all been so busy with a focus on; supply chain, RFID, customer loyalty cards, gourmet marketing, customer kiosks, and other trendy items that yes, there may be some new retail executives that are not well schooled in the blocking and tackling of retail called “labor”.
Now “labor” is the old school term for workforce management, employee optimization, human capital management, workforce integration, etc. etc. etc. As we move through time, people have a tendency to make common situations uncommon by affixing a new title or acronym to them.
When I say “do it the right way” I mean it in simple terms. The “right way” is to devise a system of employee utilization (scheduling) that is driven by accurate data from store and corporate systems (POS, warehouse, scales, and pricing), accurate task standards (well thought out measured engineered processes) and customer standards (timed studies and observations of top performers to assign the true time for customer service). The “right way” is to utilize intelligent budgeting and forecasting algorithms to generate demand for labor and to monitor those forecasts from a central process involving true forecasting expertise regarding trends, historic references, and special instances. Further, the “right way” of generating demand for labor means ALL of the labor including tasks and special events integrated into the overall workload of the store. The “right way” includes developing schedules with employee input and preferences in mind as well as local, state and federal laws followed accurately. Finally in this list and by no means the last of the strategic points to consider, the “right way” includes the value of inspection of compliance as well as valuable exception reporting to help stores run stores, divisions run divisions, regions run regions, and the whole of the enterprise is moving in the same direction - workforce optimization.
All this and the need for executive support and interaction from Operations to HR to IT to Engineering, to Merchandising, to Loss Prevention doing the “right thing” is an enterprise endeavor and must be part of the corporate fabric.
The NRF announced today that they anticipate retail holiday sales gains of only 2.2%, which is well below the last ten year average of 4.4%. The US consumer is going to be a selective shopper, and spend more wisely than in the past I would imagine.
With that being said, and with the entire economic situation at play, why would a retailer not want to approach their business in a more intelligent manner? Why would a retailer continue to deploy their workforce in the same manner as years past? Why would a retailer not look to advancements in technology and methodology to enhance the customer experience, keep a rein on unwise labor spend, and define needed processes to gain market share above the 2.2% increase level?
Is this the type of environment where a retail executive would continue to rely on bad judgment regarding forecasting by a rogue store manager? Is this the type of environment where a retail executive would continue to wait until after the sales week to give labor spend a thumbs up or a thumbs down? Is this the environment for employing antiquated formulas for customer service in stores?
It is simple, the answer is NO. This is a time that requires action. This is a time in our economic history to try more than ever before to do things right. This is a time to be proactive in your approach to your workforce. Unfortunately, since it is October, it may be too late for direct, impactful effort to improve the retailer’s operating model that can be applied to this coming holiday season. However, it is the perfect time, the perfect “lab environment” to look at processes during the busiest time of the retail year. Lessons learned and decisions made now can have a great effect on years to come.
The retailers that begin…immediately… a strategic program to optimize their workforce will be the retailers in front of the pack next year, and the next, and the next. Those that hobble along making no change to strategy and taking no tactical steps to improve their workforce from a quality and cost standpoint will be the statistics of failure in the future.
I know it is hard to think strategically and in a forward thinking manner while all types of economic bombs are going off around you, but there is never a time for inaction in workforce management. There are too many ways to set yourself and your company up for success to be distracted by every step sideways. The good companies are constantly improving. Why would you not want to do things right?
There, I just saw it again. A software vendor trying to answer the puzzle of workforce management by virtue of time and attendance only.
Now don’t get me wrong. The vendor I am referencing is a fantastic time and attendance vendor. They have poured millions of dollars into their time and attendance product and all of the ensuing HR, pay rules, and government rules and regulations needed to have a good time and attendance system.
That is great, but the retailer kept coming back and asking how the forecast algorithm worked and how the scheduling pick lists were deployed. The vendor kept referencing their state-of-the-art time and attendance features. The retailer was looking for a workforce management solution not a time keeping solution. They already had one of those, including expensive, dying of old age monster clocks on the wall.
I have said it time and again in this space and in face to face meetings with clients and prospects; workforce management is something well beyond time and attendance. The retail operator needs to understand how much labor to spend, not just how much they did spend. The retail operator must have a clear conscience that they have done all they can to measure the work to be done and apply people to it, not just measure the time that was spent doing work at the store. I mean really, do we all run our lives and personal finances by listing checks in the check book and doing the math to see the balance? No, forecast what we will bring in as pay, how we will need to spend the pay, and schedule the outlay of our payments.
Like our personal finances, retail workforce management is an interactive and constantly evolving process. Just hanging a clock on a wall and reporting on time spent is just like opening a checking account and just reading the balance every month.
Retailers must begin to understand that workforce management is much bigger than time and attendance alone. WFM is the whole of time and attendance, engineering the store with task and customer service standards, task-based budgeting and forecasting for accurate workload, inclusion of exceptional store tasks and events into the workload, the strategic application of government, union, and corporate work rules, and the proper means to report on exceptions and anomalies via analytics.
I was conducting a session with one of our new sales people the other day. The topic was “Just what does LSI offer….what are the products and services we need to focus on in sales?”
I went into about an hour dialogue on all that we do. We talked about all of the modules and pieces of our suite of products and services. I really filled up a good sized white board eight feet long and four feet high!
As we talked it all over, we kept coming back to the core of workforce management; the workload that determines the workforce need. Everything points to workload; the WFM strategy of the retail store; the service level and effectiveness of the present WFM system; the pinch points in the layout of the retail store; the data mining for WFM; the task and Customer service standards; the store profiling; task management; forecasting and budgeting; scheduling; analytics and management information; best practices and process improvement; 5s and all of the engineering around Six Sigma. Everything revolves around how a retailer needs to build up accurate workload demand through accurate forecasting and accurate development of need from that forecast so the retailer can execute a Customer satisfying schedule of the workforce.
I have seen projects in WFM fail or abandoned for many reasons. The most popular reason is that the project team did not do everything possible to get the workload, the focus, the center of the system, right. I have seen end users stop using a system due to frustration that “we don’t get the right amount of hours to run the store”. I have seen project teams blaming the software vendor for not creating magic schedules that answer all of their needs because they the retailer could only provide inaccurate sales per hour standards to drive the system. I have seen operations at war with IT because no one can make the black box spit out accurate schedules within fiscal budgets all because again, the workload being generated was not accurate or the stores were not accomplishing the workload due to bad practices much less best practices.
Well, believe it or not, the new sales person is still with us and doing an excellent job. I can’t wait for the next one!
There has been a great deal of discussion on how retailers are going to survive the current economy. Their prices are rising and it is a tricky business passing those costs on to an already heavily burdened consumer.
As you know when you read this space, I am a proponent of cost control via best practices and process definition. I also am an ardent believer in using technology to manage the retail workforce through a centralized/web based process. These methods help the retailer to define the amount of cost it puts into its operations. Protecting the cost line is the fastest way to improving the bottom line.
However, as we all know and as I espouse frequently here, there is another step to workforce optimization that cannot be ignored, especially in these times when the retailer has no choice but to raise prices to their customers. That step is the pro-active step of measuring, defining, strategizing, and managing your customer service.
It is time for intelligence to be part of the equation. No longer can the retail executive make some loose assumptions on what level of customer service is optimal to keep his or her customers. Think of the meetings you have attended where Executive A or B says, “let’s just add 2% to our labor hours and dedicate that time to customers.” Why? Why just shoot from the hip?
I have seen executives take that stance when their competition is pummeling them and taking away their customers because the employees do not have the budgeted/forecasted/scheduled time allotted for their normal work much less the customer service piece. I have also seen executives use that approach in a big box environment where the customers know exactly what they need, where it is, and do not need a “stalker”, rather they need to see the benefits of a “stocker”.
In this day and age there is no reason NOT to have a customer service strategy, measurement of your present level of effectiveness in customer service, measurement of the needs to improve your present status to match your strategy, and an ongoing practice of measurement and improvement.
How much to pass on to the customer regarding rising product costs? How much to invest in the customer to keep them regardless of the answer to the first question?
As I read the trade magazines the last few weeks, I see more and more references to cutting costs. These are major supermarket and specialty retail chains espousing the need to get costs in line so when the economy turns back to the better, they can concentrate on sales and growth.
In my opinion, this is a little bit like closing the barn door after the cows are wandering through the hills. Retail executives are learning too little too late that costs control their destiny.
Other than Y2K, where the whole retail industry had the heck scared out of it, there has been little attention to using technology for cost containment in the last decade. Sure, there has been “lip service” paid to a few initiatives like task management and even a few workforce management projects sprinkled around retail, but when you think about the magnitude of the retail industry and look at the number of cost cutting initiatives in place, it is a very small arena.
The problem is that what is in place for cost control in retail is mostly old technology; client server, green screen technology that can not effect rapid change in costs. Further adding to the problem is the economy as mentioned before.
What I see, unfortunately, is a large number of retailers being pushed to the limit of efficiency while they report bad financial results month in and month out. These are the same retailers that many vendors in workforce management approached over the last 7-10 years, imploring them to buy into new technology that would allow them to control costs in the future when times are lean. Unfortunately, now you see these same operators that spent their whole IT spend on sales producing technology bemoaning the fact that they need to cut costs.
This is simple, it is not rocket science. You need to spend money to save money just like you have to spend money to make money! Instead of being short-sighted and addressing technology in the good times, there is a need to address technology and processes in the bad times so you can avoid the next round of downturn in the economy and sustain your success.
Think about it!
It has been quite a 10 days for me. I have been involved in numerous sessions with many different types and sizes of retailers recently. We have been hard at it doing discovery and formulating workforce optimization programs all over the country.
I have been involved with people in the Mid-West, the Deep South, The West Coast, the Northwest, and the South East. I have been talking to small non-profit retailers and huge discount retailers. I have had discussions with traditional supermarkets as well as large scale specialty retailers.
What has been interesting is the thought process that revolves around retail forecasting. Now, I have been working with site managers and division managers for going on 20 years on forecasting. I have given presentations and training sessions galore on the subject.
Eight years ago, a client asked about the possibility of central forecasting. At that time, in light of the client server aspect of workforce management, it was difficult to manage that process. However, being the good consultant, my team and I came up with a way to help the client develop central forecasting.
As has been evident in my travels recently, there is a growing need for more central control in the forecasting process. Luckily as a best practice, the ability is at hand. As a best practice, deploying a corporate forecasting calendar that can be detailed by site, is a functionality that every workforce optimization must include in this day and age.
The reasons are many, but chief among them are, the ability now to obtain data at “almost real time” for deployment, the corps of managers (especially in specialty retail and discount retail) are in need of assistance in the forecasting process, and the investment by central offices in more workforce optimization teams. All of these combine to pull the importance of calendar based central forecasting to the forefront.
On the wire the other day was the annual FMI re-cap on the benchmarking of technology in supermarkets. From the looks of things, supermarkets are willing to do selective spending on systems in 2009.
That is pretty much the trend we see in working with our clients. Many chains are weathering the storm in 2008 with higher gas and food prices, holding back on some of the traditional IT spend. They do tell us, however, that 2009 will be a year where they will look to intelligent projects with rapid ROI.
FMI reported that 2.4% of companies were going to replace time and attendance in 2009. Another 9.8% will address workforce management scheduling next year. Yet another 14.6% will work on promotion management and task management.
These are all noble projects that certainly can pass the tough scrutiny on IT projects for ROI. Implementing technology in these areas will hone in on the largest controllable expense in the budget.
Proceeding with my mantra of “doing things right” I just want everyone to remember that there is more to the job than just throwing technology at functions. Engineering a store to understand true productivity, applying task and customer service standards to workload, addressing task management with an eye on closing the loop on true workforce management are but a few of the best practices needed to utilize technology in retail.
Although the numbers are strong on embracing new technology, I wonder what the statistics are on replacing aging technology. Knowing that 73.2% of supermarkets have labor scheduling technology now seems like a high numbers, but what of the other 26.8% of chains that do not have a scheduling system? What portion of that 73.2% is using old and ineffectual labor scheduling software and old client server technology?
It should be an interesting 2009!
I was on a plane, heading for the West coast yesterday. Behind me, two people were discussing some unfortunate instances at two different retail stores - not that I eavesdrop, but heck, it is a plane!
The one person had gone to a supermarket to try and find some specific items for a very unusual diet plan that their spouse needed. The other had gone to a specialty retail store in a strip mall to find something for an upcoming social affair.
The person going to the supermarket picked the retailer because they claim to be customer friendly and reactive to the needs of ALL their customers. The person going in hunt of specialty retail chose their destination because the retailer was noted for being on the leading edge in fashion and capable of assisting everyone with finding the right piece of apparel for the right situation.
OK, you see it coming don’t you? Yep, they both ended up with bad experiences and vowed never to return to these two retail establishments.
At the supermarket, it was not so much that the employees did not want to assist and to help search for the specific dietary items for the customer, no, it was just that everyone they tracked down was in the middle of two or three functions relating to accomplishing tasks and had little to no time to help a customer.
At the specialty retail store, the staff was overly helpful and in a sense was “stalking” the customer. The problem was that they should have been “stocking” as well since there were no pieces available on the sales floor that were of the right size. The customer got the old “let me check in the back for your size” and was of course disappointed in the end.
What this shows is a lack of follow through in optimizing workload in a retail environment. The best practice in workload optimization is to have all of the stake holders - the customer, the employee, the company, and the stockholders realize an optimal amount of satisfaction. If the emphasis is too small on one area (customer service in the supermarket sense and completing basic tasks like stocking in the specialty retail sense) then something is going to come up short in the workload optimization process.
Again, the best practice is to think the whole thing through - tasks, service, activities, fixed needs, the whole of workload. You can make your reputation by emphasizing one thing or another, but to optimize your retail abilities you have to include everything in your workload makeup.
Well, it looks like the latest craze is to expound one’s ability at analytics. Many software vendors are using that catch phrase to try to get the market to think this is something new and leading edge.
When I came up in retail, the phrase drilled into my head was “you get what you inspect, not what you expect”. That meant you had to circle back time and again to be sure everything you had laid out in terms of strategy was followed through on a tactical level.
A good retailer should not be fooled by reinventing management exception reporting. This has been the baseline of retail operations for generations. I wonder if just by coming up with a new catch phrase some people think they can fool us into thinking they actually have a new idea.
The right path to follow is a systematic approach to doing business intelligently. Optimize your workload and have stake holders of your business happy, and you do not really need analytics. You need reporting, management information, sound benchmark measurement. Analytics is defined as “the branch of logic involved with the analysis of propositions”. A sharp retailer needs to deal with performance more than propositions.
Do not get me wrong. I believe analytics are an important way to define strategy. However, do not get caught up in a catch phrase. Make sure that the information your workforce management system gives you helps you optimize your workload. Expect what you inspect!
Today I read with interest the “State of the Store Manager 2008” benchmark report in this month’s Integrated Solutions for Retailers. This is a very interesting and comprehensive benchmark report sponsored by Sprint. I suggest you give it a read.
First of all, being an ex-Store Manager, I find it refreshing that people actually show concern and care for that hard working bunch of retail managers. These are the people that make a retail company work, and deserve to be studied and heard.
A couple of things stood out in the article. The overall finding that Store Managers have more to do and fewer employee hours with which to do it is very interesting. This supports many of my other entries in this space about facing the employee more and more away from the customer by giving them more physical tasks to accomplish without measuring the needed time for customer service.
Another entry addressed the fact that all of the Store Managers polled believe in technology as an aid to help them accomplish their goals, but close to half think that their company is poor at implementing technology. In my previous blog entries, more than once I have discussed the reason for WFM implementation failures. We have said before that unless a retailer wants to do an implementation the right way, they are fooling themselves as to the true ROI of the program. This study gives credence to that thought process.
As a last observation, it does seem that my brethren Store Managers place a high importance on workforce management applications. Of the thirteen technologies that were polled, only six were considered more valuable to the operation of the store than automated labor scheduling. This tells me that the Store Manager is on board with finding the optimized workload for their stores. Perhaps if they can, they can use more of those 50+ hours a week they are working getting to know their customers and employees better, thus making their job more enjoyable.
It happened again last week. Another request for proposal came out from a retail firm for a new workforce management system. As has sadly happened time and again, this one was a strict challenge from a procurement department, with no view of the process from operations or human resources.
I have said this before, workforce management projects need to employ the thoughts of the whole retail enterprise to have a chance at success. You cannot have just an IT project or just a system replacement to have WFM success. You cannot limit participation to portions of the WFM stakeholders, you must include the whole “team” of players to have a workable and useful system.
In the case last week, it was obvious that finance and IT had supplied 99% of the criteria for a new system. The other 1% gave lip service to human resources, and there was no obvious input from operations at all. I mean, are not these the people that run the locations and have ultimate responsibility for the workforce? I would venture to say that this project never meets success.
In the concept of workload optimization, which is what WFM really is, we must include all of the stakeholder’s needs in the workload development for success; the customer, the employee, the company, and the stockholders.
This is an easy best practice to follow, just get everyone involved. Trust me, you will save yourself having to do it all over again in a year or two!
Lately I have been impressed by the number of prospects and clients we have run across that are embracing “people counting”. Recently, some 40-50% of our prospects and projects are deploying some form of traffic analysis for workforce management.
We at LSI and our parent company WorkPlace Systems employ functionality that uses queue length and idle time data for two purposes; to provide customer service Key Performance Indicators (KPIs), and to adjust the profiles on which register staffing levels are based to take into account excessive queues.
Many vendors continue to only review the historic point of sale data to determine a forecasted need. We see that data coming up “short” many times because the retailer can cause the data to be skewed since the service levels represented by the POS data are not analyzed. One needs to know how many were in line to accurately shape workload demand.
Also, as many of our clients have taken the plunge to develop and deploy engineered standards in all departments, this type of tracking is increasingly important in a service department environment like a deli, bakery, or service meat counter. There is the need to know how many customers could have been serviced if there had been adequate staff on hand.
So “bravo!” to the retailers that continue to try to optimize their workload by including all data points in the analysis. I strongly suggest those of you that have not considered this part of the equation to reach out to the vendors offering various methods of people counters before the holiday crush of customer traffic.
The other day I was asked what is the number one best practice in workforce management. I did not blink or think the answer came rolling right out of my mind. The most important dimension is completeness.
Do you have a complete team assembled to do this project? Have you completely laid out the requirements for the project? Do you have all of the data needed to effectively create workload demand and forecasts? Have you completely constructed workload demand including tasks time, Customer service times, event times, fixed time, and variable time? Do you completely understand the government, union, and corporate rules and regulations for scheduling people and tracking their time and work?
When you begin to formulate a WFM project, think it all the way through. Take the time to assemble everything and everyone you need. It is so difficult to go back and try to add pieces back in after you start. Fragmented projects lead to failure of the project, especially in developing workload. If you do not capture all of the work, regardless of the sophistication of the infrastructure or the software, the end users will not see the overall project as complete and valuable. It will be impossible to obtain store and division buy-in.
I am sorry, but I hate failed projects. You can ask my wife how upset I get every time I start a project, but because of my complete ineptitude in carpentry, plumbing, electric, or mechanics the project blows up in my face!
The same goes for workforce management (WFM) projects. When I see a retail team attempt a WFM project and fail, it upsets me, as well as all of the retail executives involved, I am sure.
For years I have been trying to avoid those failed projects just like I try to avoid my wife’s projects but in a different manner. Whereas I cannot educate my wife because she is not interested, I hopefully can assist retailers in WFM because we have been doing this for a long time.
I was recently on a conference call with some partners. A certain company was beginning a WFM project and I was starting to assemble a team to work on the project. As I was on the call, it struck me that the partners were unaware of this project, and the partners were already engaged at the retailer. I thought that was odd because these partners had a great relationship with the IT people at this retailer. I mean no IT awareness……on a technology project.
I have seen it time and again.; Operations not talking to HR; HR not talking to IT; IT not talking to Engineering; Engineering not talking to Training; Training not talking to Operations and on and on. This is where WFM projects break down.
WFM projects need top down, bottom up, cross vertical cooperation to succeed. It is the only way they can succeed. If a functional entity tries to enact a change in WFM by themselves, well that is just as silly as me trying to drive a screw with a hammer. Both are doomed to fail!
I read the Retail Systems Research (RSR) report The Customer-Centric Store the other day. Suffice to say that I was quite pleased to see such an emphasis on Customer Service issues. It is a very detailed analysis of customer and employee facing issues that everyone in retail should look at.
The problem with reading a report like this is that it brings up some of my pet peeves in retail today, as you may well know from other entries in this space. Primary among these “peeves” is that too many retailers only view Customer Service as an expense. They should be looking at it as an investment.
OK, fine, if we measure the demand for Customer Service and apply it to workload, yes it does create more labor. No doubt about it. However, most importantly, we should look at it as a way to justify existing task related hours and an opportunity to increase conversion rates.
The buzz is that the retail industry needs to make investments in technology around Customer Service. In my way of thinking, however, the buzz should be in actually making a commitment as a retailer to adding Customer Service to your workload and getting your good people out in front of your good customers.
Come on. It is not that difficult to arrange a comprehensive plan to measure the need for Customer Service time. It just takes the right methodology and the right tools. The difficulty is in committing yourself to actually improving your Customer Service with people, not applications and marketing. The best selling aid you have in your store is a well trained, knowledgeable employee with adequate time to assist a customer.
Do some soul searching Mr. or Ms. Retail Executive. Are you really committed to your customers? Are you willing to make up a plan and execute it to get your people in front of your customers?
As you may have noticed in my other entries, I hold the concept of solution in much higher regard than just software. In my opinion, software is merely a tool that may or may not be part of a solution.
Let’s say you go out and spend a significant amount of money for some software to automate some part of your normal work. You pay for the license and you pay for the installation services. What you end up with is a tool that is dictated by the software company’s functionality. Now imagine instead that you work with a solution provider on that specific piece of work. You may use software as part of the solution, but have you actually drilled down to the business case and addressed your problem or challenge?
It has always been my belief that if you do not approach any business case with a solutions driven energy, the problem you are trying to solve will never be adequately addressed. Sure, you may fix a part of the problem by putting a software bandage on it, but you have not reached a solution to your problem.
In retail, the problems and challenges come from many directions. There is pressure from competition for sales. Pressure from competition for people. Pressure from customer demand for service and the ensuing conversion rates. Pressure from unions, governments, and business partners. These pressures need to be solved, therefore they need solutions, not just software.
My advice is to always work with a solutions provider. If it is so easy to slap together software and keep it alive with maintenance and support (as we are told by many vendors) then there must not be enough substance to the project that it will solve your problem.
Something has been gnawing at me for quite a long time. The term “Workforce Management” or WFM has become a misnomer. When retailers first coined the phrase, it was intended to depict the process of using data and artificial intelligence to manage the workforce via forecasting, scheduling, and time and attendance.
In my view it has been boiled down to an inadequate process of selling time and attendance and automated scheduling to retailers by vendors interested only in making a sale of their software. What should be happening is that retailers should use the loads of available data and software functionality in conjunction with best practices to optimize workload and enhance all stakeholders in the chain of events that is “work”.
What I am talking about is “WorkLoad Optimization” or WLO. WLO means that the customer, the employee, the company and the shareholders in the company have reached a combined optimal level of work to satisfy all their collective needs.
Here is my point. If the amount of productivity expected of an employee is accurate, and the employee is satisfied that their day’s work is a good firm day’s work, and the customer is serviced adequately and at a level to satisfy their desire to return and spend more at the retailer, then the company and shareholders and employees and customers are all well taken care of. We will then have reached an optimal level of workload; the true balance of all needs and functions being serviced via the amount of labor expended in the store.
This is a concept that will take more than a few installments to investigate. We will return to it soon. In the mean time start thinking; is your WFM really WLO?
Software companies sell software and push software and focus on software. They should, they are software companies.
What makes a WFM vendor unique? What makes a WFM vendor powerful in helping retailers obtain ROI on systems? I’ll tell you what…..providing an end to end SOLUTION, not just a product, not just a service, not just software….a SOLUTION.
In this space over the next few months we will discuss the value of standards in numerous ways. We will talk about task standards, step standards, customer service standards, fixed standards, variable standards, universal standards and on and on.
Workload demand is the rock upon which WFM is built. It has to be right. The forecast has to be right, the data that determines work volume has to be right, the “X” on the “x times y” has to be right to generate labor demand and workload. This is not easy. It is never easy to reach perfection and follow all the way through on something.
Many vendors downplay standards because it is hard to integrate them into a software package. This can lead to a slick looking and fast schedule being produced, but does not allow for the accuracy that your labor line and your customer service deserve.
Look at your present system. Look at the systems you are contemplating putting in this year or next year. How do standards and accurate workload work in these systems? Then go out and find a SOLUTION vendor that help you enjoy benefits from your WFM system and apply accurate standards to your business.
OK, I just have to get this one off my chest. We have a customer that obtained a sophisticated store standards system from us over three years ago. There was great excitement at this retailer that at last they not only knew how much they spend on labor, they would soon have a better idea of how much should spend on labor and when.
Remember, I said three years ago….plus. As of today, they still have not used the data and the methodology because they ran down a time and attendance path in WFM instead of using WFM in priority order.
WFM is many things; Intelligent use of data to devise accurate forecasts; Definition of processes and assignment of workload for those processes; Marrying the forecast with the workload drivers to determine how much time to schedule when and where; applying laws, rules and policies to construct optimized schedules and assigning them to employees in a fair and intelligent manor. Oh yes, and there is also the need to clock in and out, determine the pay rate for the time and sending that information to make up payroll.
But wait a minute! We are saying the pay portion is the smallest portion of the picture which is even a bigger picture when you factor in task management, analytics, budgeting, and compliance issues! So why oh why do we have software vendors that are excellent in one thing…time and attendance….becoming the vendor of choice in some retailers regarding WFM? Trust me! WFM is about the forecast and schedule more than the reporting of time! Perhaps, if you have a reverse strategy now that is why you are going backwards in WFM?
Now that is a loaded question. In my experience it is usually answered, what a specific retailer is doing in WFM now. Kind of like saying that old tie you are wearing looks nice, even though it went out of style years ago. You just don’t know what you don’t know.
Think back with me. I was a part time Produce clerk in a day when potatoes were five cents a pound and I was making $1.75 an hour. At that time it made perfect sense to pay me to stand at a scale in the Produce department, weighing each customer’s produce bags while I put five pounds of bulk potatoes into a tube lined with a plastic bag and putting on a sticker thus creating a five pound bag of potatoes for twenty-nine cents.
Were those the best practices? Was that better than buying pre-packed potatoes that only require ripping open the case and stacking the potatoes on the rack five pounds at a time? Was that better than having a scale built into a scanner so that the weighing was just a part of the final item processing? How about the fact that you can even have the customer check themselves out and not even have to use the seconds needed to weigh and scan by a clerk?
What are the WFM best practices? Have you reviewed your time and attendance compliance and accuracy lately? How do you forecast and budget labor needs? What data moves your workload demand and builds your labor model? What is your strategy on scheduling rules and regulations? Have you kept up with the times in scheduling based on laws and union rules? Who is involved in WFM at your company? Who is the Executive Sponsor of WFM initiative? IT? HR? Operations? Finance? What is the best entity to direct WFM?
How about the view your company has of labor on a day to day business? Who knows when what labor costs are on a given week? Is there lag time between performance and reporting on that performance?
Are you integrating all parts of WFM? Task Management, Budgeting, Forecasting, Scheduling, Time and Attendance, Reporting, Analytics, Optimization and everything associated with these functions?
Just like you review the latest prototype of store you remodel and/or construct on a regular basis, you need to keep your WFM efforts state-of-the-art. Do a quick review of your present situation in WFM. What is standing out as an opportunity? What could not be called the best practice?
A famous saying by Santayana is “those who cannot remember the past are condemned to repeat it.” That is true in world politics, US domestic decisions, our own lives, and the lives of those around us. It seems simple doesn’t it? If our mistakes have a tendency to repeat themselves, then why can’t we avoid the pain associated with them and avoid them?
I have now, after close scrutiny of workforce management in retail for over fifteen years witnessed multiple retailers making repeated mistakes in defining their workforce management strategy. Most of these require itemized scrutiny, and that will happen in this space over the next few months. However, to list my pet peeves I will take a swipe at the whole of the problem here.
In workforce management (WFM) the objective is to effectively manage the workforce and the ensuing payroll costs. Why then do so many retailers let huge software firms dictate their effective strategy through software alone? Why do so many executives fall back and let generalist consulting firms navigate through the best practices in WFM? Why do retail executives allow their procurement teams to focus on bells and whistles and platform compliance and infrastructure specifications when they should be concentrating the effective management of the workforce? Why do many retailers opt for an inflationary sale per labor hour basis for their workload demand? Why do many WFM projects leave out key portions of workload demand like customer service time and store profiling thus skewing the accurate need?
As I said, we will explore these topics in depth in the future, but I wanted to vent and get them on the table early. Look at your WFM endeavors. Do you feel you enact best practices in every portion of the process? Do you know what the best practices are?
Please feel free to contact me at kdonnelly@lsi-solutions.com.
Greetings. My name is Kevin Donnelly. I am the President of Labor Solutions International, Inc. (LSI). We are a wholly owned subsidiary of WorkPlace Systems plc, the premier workforce management software provider in the UK and all of Europe. I have been associated with LSI for ten years as a Senior Consultant, the Vice President of Operations, and now President. Prior to that, I spent 27 years with the regional supermarket chain Schnuck Markets, Inc. where I was in stores, store management, and eventually corporate management, heading workforce management initiatives company-wide.
I have started this space in order to provide a forum to discuss real issues in retailing that I and my clients and colleagues have experienced. While working with some of the top retail companies in the world, I have been able to stay close to issues and pain points that are affecting retailers in all areas, including supermarkets, big box, specialty retail, and discount retail.
The topics will change by entry, but the primary focus will be on effective workforce management. I feel that since this is the number one controllable expense on the retail P&L it deserves a great deal of focus.
At all times, I would welcome input and feedback from anyone interested in this area of expense and human capital management.
Please feel free to contact me at kdonnelly@lsi-solutions.com .
Kevin Donnelly is President of Labor Solutions International, Inc. (LSI). LSI is a wholly owned subsidiary of WorkPlace Systems plc, the premier workforce management software provider in the UK and all of Europe. Kevin Donnelly has been associated with LSI for ten years as a Senior Consultant, the Vice President of Operations, and now President. Prior to that, Kevin spent 27 years with the regional supermarket chain Schnuck Markets, Inc. where Kevin was in stores, store management, and eventually corporate management, heading workforce management initiatives company-wide.
Please feel free to contact me at kdonnelly@lsi-solutions.com
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