the definitive guide to
What is workforce management (WFM), exactly? How is it measured — and why does it matter?
If you've ever had these questions yourself, you've come to the right place for answers.
In this comprehensive ebook, we'll walk you through the complete ecosystem of workforce management. By the end, you'll understand how to identify workforce management challenges (before they bloom into disruptions that impact business operations), which latest workforce management tools can help (and how to measure their impact), plus the benchmarks you should look for (as you go about making improvements).
Along the way, we'll delve into a number of related concepts, illustrating them with concrete, real-world examples wherever possible. And in the final chapter, we'll empower you with actionable next steps so that you can put all of your new knowledge into practice.
Your workforce management transformation starts now.
Simply put, workforce management refers to processes and tools businesses can leverage to ensure they not only have the right people in the right places, but that those people are empowered to perform at their very best every day. In practice, that takes so many forms: automating how reports are created, improving scheduling capabilities, harnessing data to generate insights — and more. In all of these areas, workforce management solutions hold the potential to deliver significant benefits to businesses.
But before we delve into those benefits, let’s assess your current approach to workforce management. How well is it working? And is it contributing maximum business value?
Here are five indicators that there may be room for improvement.
No matter how well you plan, or how far ahead into the future you forecast, there are always going to be hiccups, bumps in the road and unplanned challenges — minor issues that inevitably arise in the course of daily business life. But these should be the exception, rather than the rule.
So if you find yourself constantly being asked to create ad hoc solutions on the fly, your organization is likely suffering from challenges related to workforce management.
Where is your company today — and where is it going tomorrow? If you can't say for sure, that's a major red flag.
For starters, it means you won't be able to adequately plan for future talent needs that will be critical in powering the growth of your business. Lacking a clear sense of organizational priorities, you'll simply always be trapped in reactive mode, rushing to put out one fire after another. And that's a tough position to be in if you want to support strategic goals.
The ultimate goal of any workforce management solution is to improve operational efficiency. So if you're lagging here, or notice areas where operations are running at less than full capacity, that's another red flag — and your approach to workforce management may be to blame.
Is the issue that you simply don't have the right employees in the right place at the right time? Alternately, perhaps the departments and teams within your organization aren't connecting in a way that improves efficiency? Either way, addressing these challenges by rebooting your workforce management strategy can have far-reaching business impact.
Nobody likes coordinating schedules, especially when multiple stakeholders are involved. And when you're dealing with a large workforce, that increases the magnitude of the headache exponentially.
In order to understand how workforce management is linked to scheduling issues, ask yourself if you've experienced any of the following at your company.
If you answered yes to any one of these, it's a clear sign that there is work to be done — and that you could drive substantial business and operational improvements by implementing superior workforce management practices.
Let’s imagine you've identified a specific business issue, coordinated with senior leadership and then dedicated the time, energy and resources required to plan and implement the solution. Fantastic! But how do you really know whether what you’ve implemented is actually working?
In fact, as many as 70% of change initiatives don’t achieve their stated goals, according to research from McKinsey. So it’s vital that you have clear methods in place to track outcomes around new workforce management solutions. Ideally, those methods will include automated reports and actionable insight based on real-time data monitoring.
But if you can’t drill down into the data points that matter — and adjust levers to see what's delivering results — you won't be able to tie actions to outcomes. And that's more than a short-term strategic deficit. Over the long haul it's going to seriously hamper your organization’s ability to successfully respond and adapt to change.
Now that you know some of the most common signs that workforce management solutions are under-delivering, you should begin to have a sense of where you can make improvements. And we’ll make that assessment even easier for you in chapter four, where we'll look at benchmarks. That way, you can see, objectively, how you stack up.
But first, let's examine in greater detail how workforce management can be connected to ROI. This information, which frames workforce management in terms of bottom-line outcomes, should help you make the business case for proactively addressing these issues internally.
In business, ideas — even seemingly great ones — won’t get off the ground unless they can demonstrate clear ROI. That’s why, in this chapter, we'll be walking you through a few of the ways that workforce management solutions link back to the bottom line.
Digital time and attendance (T&A) systems today allow employees to more efficiently clock in and out of work, often using only their mobile devices. Better still, this data can then be automatically integrated with payroll, reducing the overall burden on your finance and administrative teams.
What’s more, some of these mobile-friendly tools even enable employees to create and manage their own schedules, selecting only those shifts that work for them. And in the event that someone can’t make a given shift, that employee will now have the ability to coordinate coverage with colleagues. That alone can ameliorate any attendance and headcount woes your business may be experiencing, in turn increasing profitability.
At the end of the day, data-based decision-making is only as good as the quality of the data it starts with. But by streamlining — and in some cases eliminating — data-entry processes, today’s advanced workforce management solutions can remove data-related pain points and confer significant gains for businesses.
For example, there are new workforce management tools that can automatically transfer data from smart devices to cloud-based web dashboards. From there, this information can be viewed holistically and mined for insights, which means business leaders no longer need to wait for field personnel to return to headquarters in order to make timely strategic decisions. Plus, there’s no any risk that data will be logged inaccurately.
Leveraged effectively, these kinds of improvements will pay dividends on the balance sheet.
Today’s economy moves faster than ever, and businesses that can’t keep pace will quickly fall behind. So if reporting processes at your company are still stuck in the 20th century, with manual-intensive data entry as the norm, that’s a sure sign of trouble.
Thankfully, today’s more sophisticated workforce management tools are revolutionizing how, when and where reporting takes places. What had been a backward-looking view built on old data becomes, instead, a forward-looking, near-real-time outlook on current and future business performance.
What’s more, these tools can dramatically simplify the end-to-end reporting process — with advanced visualizations, customized views and data drill-downs all available at the click of a button.
Given the pace of innovation, even the fastest-moving companies may not be fully aware of the depth and breadth of workforce management solutions on offer today. So don’t worry if your company isn’t on the leading-edge when it comes to adopting the latest tools.
That said, given the potential ROI of these solutions, we should dig a bit deeper to see where you stand to gain the most value. And in the next chapter, which lays out key benchmarks, that’s exactly what we’ll do.
In this chapter, we'll take a deep dive into the metrics and numbers that matter most in connection with workforce management.
These benchmarks, drawing on Randstad's deep domain expertise and diverse experience with clients across industries, are designed to give you insights into the state of workforce management at your company today. How do you stack up? And where is there room for improvement?
Let’s dig into the numbers and find out.
As discussed in chapter two, modern workforce management tools can solve for any number of business pain points and significantly enhance wide-ranging capabilities, including reporting to scheduling, planning and more.
But to reap these benefits, you’ll need to be not only investigating, but actually investing in, the latest digital technologies. Where does your organization stack up in that regard?
Between now and 2020, 46 percent of organizations say that “increased use of automation” will be among the most important drivers of their business growth, according to one study. The flip-side of that, of course, is that the majority of companies remain behind the ball.
Do you count your company among the 54 percent who aren’t prioritizing enhanced workforce management and other digital transformation initiatives? If so, it’s time to take action — immediately. Otherwise, you risk getting left behind.
As discussed in chapter three, state-of-the-art workforce management solutions can transform the way data enters into enterprise resource planning systems — as well as what happens to the data once it gets there.
To see if this is an area where your organization could benefit, you’ll need to dig into existing processes. How much manual intervention is required to, say, fulfill orders or complete a service request from a client or customer?
One benchmark to aim for — a conservative benchmark that has been shown to yield clear bottom-line improvements — is a 65/35 breakdown between automation and manual efforts. That is to say, any process requiring more than 35 percent manual efforts for completion is probably ripe for intervention.
One of the most immediate ways that workforce management solutions can deliver value to many businesses is by improving scheduling processes to minimize absenteeism and lost worktime. After all, when key personnel aren’t where they’re supposed to be, when they’re supposed to be, the impact felt by businesses is acutely negative.
Across all industries, according to data from the U.S. Bureau of Labor Statistics, the overall employee absence rate in 2018 was 2.9 percent, while the lost worktime rate — that is, absence as a percent of hours usually worked — stood at 1.5 percent. In other words, on a given workday in America, nearly three out of 100 employees were MIA.
If the number at your organization is higher than that, it’s a clear sign that something’s gone awry. You should research workforce management solutions specifically designed to augment organizational scheduling capabilities — many of which can reduce overhead expenses, too.
Beyond calling attention to potential areas for improvement, these benchmarks should also serve as yardsticks by which you can measure and track progress going forward. And by keeping them top of mind as you assess the maturity of your existing workforce management strategies, you should be well-positioned for long-term success.
Ready to pull all that you've learned together and put it into practice? Move on to chapter five — the final chapter in this ebook — where we’ve got next steps to help you do exactly that.
At this point, you should have a fairly fine-toothed understanding of all the nuances of workforce management — from diagnosing signs you have a problem to understanding the possibilities offered by the latest solutions and more. Now it's time to put that knowledge into action.
As you read through these next steps, keep in mind that they're only suggested starting places — ad hoc fixes that can help you move the needle on key pain points. However, if the problem at your company is systemic, you'll need to take a systemic approach.
Any strategic initiative that's rolled out without complete alignment on short- and long-term priorities between stakeholders is doomed to fail — and your WFM strategy is no exception. In developing priorities, you'll need to have buy-in from senior leadership, so it's important to start the conversation and win an ally from the C-suite as early as possible. From there, connect with relevant stakeholders to figure out what's most important for your company today and for where it's going tomorrow.
Over the long haul, of course, the right workforce management strategy should help deliver on all of the above — but it’s not going to solve them all at one fell swoop.
That’s why you've got to start by determining what matters most today. It’s the only way to ensure your initiative achieves short-term wins, which will be critical stepping stones in the path to long-term success.
Every effective workforce management solution begins with a candid and honest evaluation of the state of existing talent practices at your company. Try to figure out where processes are breaking down, and why they don't result in the outcomes that you want.
Why is it so important to pinpoint and quarantine these bad processes? Because if you don't, whatever workforce management solution you decide on will likely be hamstrung by the same issues. And that will ultimately inhibit the overall effectiveness of your transformation efforts when it comes to workforce management.
For example, since 44 percent of organizations use three or more internal systems to handle workforce management processes, according to one study, it's easy to see how things might get lost in translation from one system to the next. If problems like that aren't addressed before implementing a workforce management strategy, all your hard work might be wasted.
Whatever goal you decide is most important, you'll need everyone to be aligned in support of it. That's key — because no matter who officially owns or champions your new workforce management strategy, implementing that strategy and making it a reality is going to require a collaborative effort.
If you're struggling with alignment, strategic partners like Randstad are often a big help. Our staffing experts are skilled at connecting with multiple client-side stakeholders, securing buy in, working consultatively to identify areas of overlap — and ultimately building consensus around value-driving workforce management initiatives. Bringing in an outside partner — one with deep domain expertise in the talent space and a unique perspective on the challenges facing your company — can go a long way toward bridging the gaps between siloed groups within an organization.
There are many different workforce management solutions out there — from "plug-and-play" software to full-service strategic partners like Randstad — so you'll need to dive into the space and do some research to find the solution that's best suited for the needs of your company. Some of these are general purpose solutions, but others have far narrower use cases, like identifying and closing talent gaps, maintaining and monitoring budgets, ensuring compliance or keeping track of employees' time. If your goal is, say, to keep tabs on employee skill development, then a narrowly focused technology solution might be the ticket. But to effectively deliver on a broader range of strategic goals, something more will likely be needed.
Finally, it's a good idea to think back to the business priorities that you landed on earlier, and use these as the "true north" that guides you in your search. You should also bear in mind that any purely technology-based solution is going to require significant input and buy-in from your company's IT team, so involving them in the discussion early on is the way to go.
By now, you should have a clear sense of your own workforce management pain points, how today’s advanced solutions can help, what benchmarks to aim for — and how taking action will contribute ROI.
Of course, finding and implementing the right workforce management solutions isn’t something that’s likely to happen overnight. That’s why, especially when you’re working to build consensus with internal stakeholders, it may be wise to frame your workforce management goals as part of an ongoing “journey” — not a one-off project with a fixed destination in mind.
But by implementing the best practices outlined in this ebook, you should feel empowered to take action.