Keeping Time

Computerized employee scheduling systems are certainly nothing new to retailers. Excel-based or client server-based workforce management systems have been around for years. And they generally did a competent job of automating the time-consuming process of writing up employee schedules.

The problem with these programs, however, was that they didn`t always live up to expectations and some store managers were reluctant to use them. And these early systems were typically maintained at each store location, making it difficult for corporate management to keep track of what was going on.

Enter the web

All that has changed during the last two years as the web entered the picture. Putting scheduling and employee utilization programs at a central corporate location, then using the web to move schedules and related information between the corporate center and the store has made the whole process more manageable. Additionally, store-level managers are freed up to do more sales-related tasks and employees are kept more closely informed of their upcoming work schedules.

"With the second-generation systems, which were client server-based, each store still maintained an isolated system and retailers conducted scheduling in silos," says Rob Garf, research analyst with AMR Research Inc. who last fall completed a study on computerized workforce management systems. "As a result, the home office was not kept abreast of what was going on. With the introduction of web-based systems, the software resides in a central location and is accessed by store management and employees in a real-time manner. "

Faster implementation

Such systems still give store managers the ability to make changes in scheduling to fit their needs, but the central office now knows what is happening at each store. "An alert can go out, for instance, if certain stores are exceeding their labor budgets and the home office controls what standards are used to decide who works," Garf says.

If nothing more, using the web to implement a computerized workforce management system is more expedient than without the web. "We had one retailer that went live with its system in 1,700 stores in one day," says Peter Reilly, vice president of sales for BlueCube Software Inc., Alpharetta, Ga.-based developer of a web-based workforce management system. "It would be impossible to send out all the necessary software and get all the stores up and running with separate systems in that amount of time."

Other benefits of web-based management systems include:

l A level of objectivity in scheduling. Having the central office set scheduling criteria and a computerized system determine the actual schedule eliminates any accusations that a manager favored certain employees when setting the schedules.

l Easy access as employees can view their schedules from home by signing on to the web site.

l The ability for employees to publicly request shift changes by stating the need for a replacement on the web site and allowing coworkers to use the site to volunteer to swap shifts. Management can review and approve these changes online. Employees can then go online again to see if their requests were approved.

l The ability for multiple stores to share employees. By keeping the scheduling centralized, employees can work at multiple stores within the chain without scheduling conflicts. This is especially helpful with highly skilled employees whose services may not be required on a full-time basis at any one store.

In addition to these web-specific benefits, the new systems often improve upon other advantages that earlier computerized scheduling programs created, such as the ability to program in union or federally mandated work rules, and assuring the optimization of employee utilization so that stores are not wasting money by overstaffing certain departments while potentially losing sales by understaffing others.

More control

"The web allows companies to have better control over how labor and business rules affect scheduling," Garf says. "Before, the central office might have sent down schedules that applied federal rules and standards and then the individual store managers would have had to go back and make changes to comply with local and state rules. California, for example, has much more rigorous labor laws than other states."

With the web, the corporate office can program the California rules into the system so that the scheduling system automatically applies those rules only to stores in California. Local managers would not have to make any adjustments and the corporate office could be assured of total compliance.

When many retailers talk about workforce management systems, they are often looking mostly at how to cut costs by reducing employees. But that is not the objective they should be trying to achieve, vendors and analysts say.

"The idea is to get the right employees doing the right jobs at the right time. Sure, you`ll save on labor costs, but more important, you should increase sales by making sure customers are being waited on properly," Garf says. His report cites an unidentified apparel retailer that showed a 50-basis point improvement in conversion rates when it used an algorithm-based scheduling program to align staff with customer demand. That improvement translated into a 2.5% increase in sales.

Web-based systems often are better at predicting workforce requirements than earlier systems because they can look at more factors when determining how many employees will be required in each department. Vendors of workforce management programs tout a number of improved analytic features in their most recent products.

"Theoretically, these new analytical tools could have run on the client server or even the old mainframe models, but the reality is that they didn`t," says Katherine Jones, research director with Boston-based Aberdeen Group. "Using the web makes it easier to get the information, crunch it and disseminate it in real-time, or web-time, as we like to call it."

While Garf says many of the improved analytical components of the web-based systems introduced in the last two years would most likely eventually have been applied to the legacy or client server platforms, it is not completely coincidental that they debuted simultaneous with the introduction of web-based systems.

"The centralized approach that you get with the web makes sure all these factors are being applied consistently," he says. "Also, as retailers move to web-based systems, many see it as an opportunity to re-evaluate and upgrade the analytical tools they were using with their old legacy systems."

The right projections

While other earlier computerized systems could support more advanced analytics, having the computations done at a central location, rather than in silos, allows changes to be made and sent out more quickly, Jones says. For example, she points to the ability to factor in up-to-the-minute weather forecasts that could affect sales levels and then communicate the immediate need for schedule changes. If a retailer knew that a heat wave was predicted for certain regions where it had stores, headquarters could immediately communicate the need for additional employees in the appliance departments for air conditioner and fan sales.

Also, many retailers experience higher sales right after the 15th and 30th of each month because that is when many people get paid. Some of the more sophisticated systems take that into consideration when setting work schedules as well as factor in the dates when Social Security and government checks arrive.

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"For example, a store might base projections for sales during a holiday on last year`s performance, but if this year`s sale is right after pay day and last year`s sale was not, you may be comparing apples to oranges," says Randy Park, vice president of Tomax Corp. In addition to the payday factor, Tomax`s workforce management program factors in higher sales for the 23rd of the month only for stores located near military bases because that is when military employees get paid.

And just looking at projected sales dollars may not be enough to consider when determining schedules, Park says. Often the number of transactions may be a bigger indication of labor requirements. The Tomax system allows the manager to view sales dollar projections, but then considers other anticipated business factors, such as transactions, when determining labor requirements.

Also task-based jobs can be factored into schedules. Task-based jobs include such things as taking inventory or moving around merchandise to reflect the change in seasons. In these cases, employees are required to perform a number of tasks unrelated to selling and these tasks are often left out of the equation when scheduling employees. "What happens then is that either the tasks don`t get done or you have employees performing these tasks when they should be waiting on customers. With the right system, the corporate office can approve what tasks really need to be done and make sure there are sufficient resources to do them without interfering with the ability to assist customers," BlueCube`s Reilly says.

The early computerized workforce management systems did not generally give corporate management the ability to monitor whether stores were providing enough staff to ensure that the tasks that management wanted completed were getting done without interfering with sales.

Faster dissemination

An executive with a regional supermarket cooperative of 200 stores says a web-based program in use for the past two years has been much better at determining each store`s needs and is easier to use than previous computerized programs. "The web makes it easier to get the information out to all our cooperatives. At the same time, the system allows the store owners to distribute their employees better," the executive says.

While the chain had used computerized systems before, the earlier systems were not as effective at looking at the unique factors at each store, while providing consistency across the chain. And more important, the web facilitates the ability for the corporation to communicate staffing concerns with a large number of independently owned stores in a real-time manner.

But aside from better utilization of employees, web-based systems are expected to improve upon employee and management satisfaction.

In terms of management, web-based systems free up store managers to spend less time developing and copying schedules and allow them to concentrate on efforts to improve sales. But headquarters must resist the urge to exert complete control, vendors say, by building in provisions to allow store managers to make adjustments to fit last-minute changes or store-specific requirements.

Indeed, one of the biggest problems with centralized systems is that store managers feel that control is shifting to headquarters. "Managers often feel that control is being taken from them," says Tomax`s Park. Allowing management to have access to the systems via the web and then making the systems flexible enough for them to make necessary changes should help acceptance, he says.

Indeed, getting all employees behind the programs is essential. "Some of the early projects failed because store managers and employees saw them as Big Brother dictating how they should schedule their stores," says Garf. "Key to getting the staff behind this is educating the staff on how this can help them and how employees are more empowered. Employees like the fact that they have easy access to their schedules and it is easier for them to switch shifts."

Employee satisfaction

Parsippany, N.J.-based CyberShift Inc. initially promoted the benefits of its workforce management system to corporate management. Over time, it also began pitching its program as a means to improve employee morale. "Employees in the retail sector often struggle with work and life balances," says Robert Farina, CEO. "This gives them the flexibility to manage that better. Being able to go online to request schedule changes and enter into the programs any scheduling conflicts they might have is a big plus to most employees."

Indeed, employee satisfaction is a big concern to many retailers. A recent study by CareerBuilder, an online employment service, noted that 47% of retail employees say they want a new job. Giving them more say and better information about their schedule will go a long way in improving job satisfaction, proponents of workforce management systems say.

Another aspect that employees often like about web-based workforce management programs is the objectivity. Because the schedules are being set at a centralized location rather than by managers at the store level, employees are less likely to feel they are being discriminated against by managers who play favorites. And thus are more likely to be satisfied with their work. "You need to be careful, however," Garf cautions. "You don`t want to take management input completely out of the system and you have to program the system so that your best employees are rewarded with the best schedules." Indeed, most developers of workforce management technology say management can set the programs to reward tenured and high-sales employees, but within an objective framework.

While other industries are using web-based scheduling systems, the needs of the retail industry are especially in sync with the benefits offered. Retailers often have many sales outlets, require multiple skills, have a large number of employees who work full-time and part-time, have a number of shifts, and have fluctuating schedule needs due to sales and seasonal considerations.

"Retailers are leading the way in implementing these systems, especially the big-box retailers," says BlueCube`s Reilly. He notes that with small profit margins and often higher labor costs, the grocery industry often finds the quickest payback.

Time and attendance

Indeed, the executive with the regional supermarket co-ops notes that his company uses the system for employee scheduling for more than 200 stores. But because these are co-ops rather than corporate-owned locations, there are additional challenges. The system has to consider more 200 variables in scheduling as well as factor in union rules. Still the co-op is able to use the scheduling programs to gain continuity. "We`re able to develop basic schedules for all the co-ops, then the managers can adjust them if needed," the executive says.

For the future, many developers of web-based systems say they will be working with retail customers to better integrate employee work schedule programs with other computerized systems that retailers use related to employees. Again, while such integration could have occurred with other computer systems, such efforts would be more difficult to achieve. "The web`s open system architecture facilitates the ability to integrate work force management with other processes," Garf says.

CyberShift`s system, for example, is already integrated to computerized time-and-attendance programs. This allows management to verify that employees worked the schedules that were originally posted. It also allows management to make sure that work, labor and pay rules that it scheduled were correctly followed.

Most technology developers say they are working to integrate the computerized scheduling programs into personnel hiring programs. Then, the system could make note if it had a difficult time scheduling employees for positions that required certain skills. The system could use the web to communicate to the personnel department what skills are in short supply and even match those required skills with resumes on file. Personnel could then be alerted to take another look at those prospects.

"Interfacing to personnel is not difficult, but there is more discussion about this than retailers who are actually doing it," says CyberShift`s Farina. "But there is a tremendous turnover in retail, so it could be a real advantage to do it."

Indeed, now that the accessibility and usability issues have been addressed, greater integration may be next on the agenda.

Lauri Giesen is a Libertyville, Ill.-based freelance business writer.