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Questions and AnswersWhat is the purpose of a Labor Management System?Labor Management Systems, also known as workforce management systems, are used to schedule sales associates in a manner that best accounts for budgets, sales forecasts, customer traffic patterns, shift rules, and associate availability. Typically the system includes a PC based workstation or web access in each store to support operational scheduling, and a central workstation for control of corporate level data such as staffing budgets. The Time and Attendance system may be an integral part of the Labor Management System or it may be a separate system that interfaces with it. Why the increased interest in Labor Management Systems?In today's ultra competitive, thin-margin environment every operational element of the business is a critical one. Failure to systematically apply labor dollars is an easy way to inadvertently raise costs, lower customer service, and thereby sacrifice competitive position. What are the primary benefits of Labor Management Systems?Schedules produced by Labor Management Systems generally provide improved service levels and lower costs than possible with manual or early computer-aided techniques. Management can systematically control the trade-off between the cost of sales and the level of customer service. For any given level of customer service, costs are minimized. Conversely, at any given cost of sales, customer service is maximized. The Labor Management System is an operational tool increasingly viewed as necessary to maintain competitiveness. Something for nothing?The Labor Management System employs advanced mathematical techniques to construct a "best possible" schedule from thousands of possibilities. By scheduling labor on the floor when needed, walkouts are minimized and productivity maximized. In this way the maximum value is obtained for each dollar spent on labor. So in a way, something is gained for nothing. Of course, there is a cost to implementing and operating the Labor Management System, but this is partially offset by a reduction in the administrative cost attendant to manual scheduling. Really the very best schedule?No! Strictly speaking, Labor Management Systems generate "near optimal schedules." Finding the very best schedule (and proving it is the best) would generally require more processing time than practical even on a very fast, up to date computer. Instead, Labor Management Systems systematically evaluate thousands of possible schedules stopping when little additional improvement can be found. The resulting "near optimal schedule" is almost always better than what can be produced by a skilled manager using manual or spreadsheet aided techniques. Are there any other benefits?In addition to cost and service level improvements, benefits accrue to sales associates and supervisory management. Sales associates perceive the schedules as being "fair", with an even distribution of the workload and opportunity to produce revenue. With a reduced administrative burden, managers can spend more time serving customers and motivating associates. Seasonal staffing peaks are more easily and routinely accommodated. Does every organization need one?No! Generally the benefits of a Labor Management System increase with the size and complexity of the scheduling problem. It is certainly possible for an organization to be too small to warrant such a system, or for the scheduling problem to be too simple. Does installing a Labor Management System require organizational change?Yes, Labor Management Systems involve a highly disciplined and systematic approach to scheduling that some may perceive as less "personal", and supervisory management may perceive as a threat. Fortunately, Labor Management Systems benefit all constituents - so the required change in thinking is a matter of education and familiarization. What about consistency with your organization’s IT and networking strategy?Labor Management Systems are available for a variety of IT environments, including Windows based client/server, and - more recently - web/intranet based architectures. Various configurations allow a fit to your organization’s communications infrastructure including dial up or high-speed WAN. Does a new system make sense?Some organizations continue to use a legacy "character based" Labor Management System. Such systems may not yield the full cost reduction and service benefits that are possible with up-to-date hardware and software technology. Potential benefits of an up-to-date system include:
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