Understanding the Fundamentals of Workforce Management Systems

The 5 Core Features of Workforce Management Software

Whether for a distribution center, warehouse, retail chain, or contact center, a workforce management software system can be as complex and far-reaching as an organization's structure, hierarchy, and workforce need it to be. And judging by recent research, it would appear that majority adoption across all business sectors is imminent (according to the CedarCrestone 2011-12 HR Systems Survey, worldwide adoption was 51% in 2011). This increasing adoption of workforce management systems can be summed up by newly released research from Towers Watson; in which they report, "In a slow recovery, persistent concerns about risk and cost require organizations to become more flexible in managing the workforce". While this sentiment can equally apply to longer-term strategic concerns such as a talent and succession management, it's clear that this issue is also driving the need for highly effective day-to-day management of workload and scheduling.

Unfortunately, thanks to the confluence of constant development by HR software vendors and shared features with other types of system (such as ERP and CRM); workforce management software remains as one of the less well-defined categories of HR and business software—leaving adopting organizations without much guidance about critical features. What follows is our list of the fundamentals that should be sought in any workforce management software selection process in order to net the highest gains on productivity, efficiency and labor cost savings.

Workforce Management Software Fundamental #1: Labor Scheduling

Using engineered labor standards derived from process best practice as a basis for optimal employee deployment, labor is scheduled according to defined requirements. This takes into account a variety of factors, including workload patterns, regular short-term peak activities, employee availabilities, holidays, multiple locations (and even time zones), budget allowances, skill-matching, labor law restrictions and company contractual terms and conditions. The granularity of scheduling should vary according to the organization's need and can commonly go down to units of fifteen minute increments.

It should also be noted that most workforce systems will also include some degree of employee self-service (ESS) functionality, enabling staff to log their availability and bid for specific shifts which can then be automatically allocated according to a set of agreed rules and factors (including competence and quality performance assessments). The average 2011 adoption level (across sectors) for this workforce management application feature set was 29% according to the abovementioned CedarCrestone report.

Workforce Management Software Fundamental #2: Time and Attendance

The "clock" at the center of any workforce management system, Time and Attendance functionalities record punch-in times and time worked. When replacing a manual clock card process, studies show a consistent reduction in administration time (often 80+%); however, it should be noted that the more flexible (and by proxy the more complex) an organization's working model becomes, the more essential time and attendance tracking also becomes. As part of this time/attendance functionality, workforce management systems are often also used to monitor indirect time (i.e. breaks and other time not spent working); which can be fed back into the workforce management system database for use in future forecasting and scheduling. In addition, time and attendance data can be exported to payroll for salary and incentive calculation and serves as a key efficiency lever in reducing buddy punching and excessive overtime—typically generating alerts if employees reach predetermined limits or thresholds on overtime, no shows, or if relevant state and federal wage, hour and leave regulations are near breach.

When time data is matched to work activity and the engineered standards, individual performance can be monitored at a surface level and, in some systems, when performance drops, can trigger prompts for coaching or other performance development activity. The average 2011 adoption level (across sectors) for this workforce management application feature set was 73% according to the abovementioned CedarCrestone report.

Workforce Management Software Fundamental #3: Leave Management

Primarily a self-service software module, the leave management function deals with absence requests, approvals, absence accruals and eligibility. Integrating with the scheduling function and also payroll for day-to-day practical purposes, this workforce management application data can be used for longer term reporting and analytics, including absence levels and trends. The average 2011 adoption level (across sectors) for this workforce management application feature set was 52% according to the abovementioned CedarCrestone report.

Workforce Management Software Fundamental #4: Task/Activity Management

Best-in-class workforce management software allows for workflow and employee deployment to be monitored in real-time. Typically this software feature set revolves around a management dashboard of key metrics; allowing quick decision-making in response to any deviations from the scheduling that has been derived from forecast workload/demand and planned staffing.

Workforce Management Software Fundamental #5: Data Collection/Reporting

As a recent HR systems report states, "Integrating the data directly with other information sources such as finance or customer-facing repositories is important to do workforce analytics to show how the workforce impacts financials or customer results". As such, in order to ensure efficient deployment of resources (and also to evidence the return on investment for the workforce management system), a range of standard and customized reports are crucial. By integrating this workforce data with that of other information systems predictive analytics can be delivered for use in strategic decision-making as well as simulations for future workforce management scenarios (e.g. advertising campaigns or the introduction of new products or services).

Workforce Management Software Fundamentals—the Bottom Line

In much the same vein as the "in-vogue" mobile workforce management software solutions, the key focus of any workforce management system is on the efficient daily operation of the workforce—as aligned with cost and performance objectives. Research supports the fact that organizations leveraging the above core software feature sets of: scheduling, time and attendance, and absence management functions can reduce both overtime costs and headcount through more efficient workforce utilization. In turn, this can translate to reduced labor costs and, as a result, lower operational costs for the organization as a whole. As such, it is critical that your organization understand these feature sets and look for a workforce management software solution that, at a minimum, empowers these capabilities.

  Categories: Workforce Management Systems

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 Author: Dave Foxall

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