Workforce management
Encyclopedia
Workforce management encompasses all the activities needed to maintain a productive workforce. Sometimes referred to as HRMS systems, or even part of ERP
systems. Recently, the concept of workforce management has begun to evolve into workforce optimisation
.
Specifically, workforce management includes:
Workforce management can also encompass field service management
. This provides software to optimally plan and dispatch field service technicians and their properly stocked vehicles to a customer's location in a timely manner in order to deliver against their service commitments. Field service management will itself include elements of:
because staff scheduling is rooted to time management
and simply manages the administration of past and future working times.
This traditional approach has since evolved into the more integrated, demand-oriented workforce management, which includes changes in personnel requirements and objectives when optimising the scheduling of staff. Besides the two core aspects of demand-orientation and optimisation, workforce management may also incorporate:
The market for workforce management (WFM) is still quite young. In the eighties and nineties, entrepreneurs mainly focused on topics such as SCM
(Supply Chain Management
) or PPS (production planning systems) and, in recent years, on ERP
(enterprise resource planning
). As cost pressures have increased, managers have increasingly turned their attention towards HR issues. In all personnel-intensive industries, workforce management has become an important strategic element in corporate management.
Workforce management solutions can be deployed enterprise-wide. While special software is commonly used in numerous areas such as ERP
(enterprise resource planning
), SLM
(service lifecycle management
), CRM
(customer relationship management
) and HR
(human resources
) management, the management of the workforce is often still handled by using spreadsheet programs or time recording. This often results in expensive overtime, non-productive idle times, high fluctuation rates, poor customer service and opportunity costs being incurred.
In contrast, by using a software solution for demand-oriented workforce management, planners can optimise staffing by creating schedules that at all times conform as closely as possible to the actual requirement. At the same time, a WFM solution helps users to observe all relevant legislation, local agreements and the contracts of individual employees – including work-life balance
guidelines.
A key aspect of workforce management is scheduling. This is achieved by establishing likely demand by analysing historical data (such as the number and duration of customer contacts, sales figures, check-out transactions or orders to be handled). Many workforce management systems also offer manual adjustment capabilities. The calculated forecast values are then converted into actual staffing requirements by means of an algorithm that is adjusted to the particular use case. The algorithm itself is based on the work of Erlang
though most modern adaptations of WFM have shifted towards a richer state management, and optimizations to the original idea.
Current and future staffing requirements, short-term peak loads, availabilities, holidays, budget allowances, skills, labour law-related restrictions, as well as wage and contractual terms have to be integrated into the planning process to guarantee optimal staff deployment. In the workforce management process, the integration of employees is an important factor. In several WFM systems, employees can log in their availability or planned absences and they can bid for specific shifts so long as they have the necessary skills for the activities planned for these shifts. Experience shows that professional workforce management systems realistically fulfil more than 80 percent of employees’ shift requests. Here, employee scheduling software
guarantees the best possible synthesis of optimised staff schedules and employee requests.
The more flexible the working time models and the more complex the staff scheduling becomes, the higher the requirements for correct time management
becomes. As time recording and accounting of working times are closely connected to scheduling, the integration of time management into the entire process is the logical consequence. Using workforce management systems, working times are booked exactly to the required time accounts and made available for payroll accounting by means of automated processes.
Many software solutions offer a number of options for evaluating the planning in real-time, enabling short-term reactions to deviations from the forecasted demand or expected over- or understaffing. Control functions enable a permanent adaptation of the scheduled staff to the actual requirements. In other words, the optimisation process allows for manual data adjustment in the case of short-term fluctuations in demand or unscheduled employee absences.
. This builds on workforce management to encompass all aspects of managing the complete workforce lifecycle and supports the business with key insights into how its workforce is performing. There is an emphasis not simply on improving operational efficiency or on managing the workforce effectively, but tying this to key business concepts such as the customer experience. The role of workforce optimisation is to tie together siloed systems and bridge between the three main stakeholders of HR, operations and IT. This approach is business driven. It involves automating entire processes, making key data more visible to support better decision-making, ensuring compliance with a wide range of relevant legislation and solving business problems related to staff. Workforce optimisation is best viewed as the next logical step in the move to optimise the performance of staff and to manage and understand the impacts of staff on both operational efficiency and the customer experience.
Workforce management provides a common set of performance-based tools to support corporate management, frontline supervisors, store managers and workers across manufacturing, distribution, transportation, and retail operations. The starting point is a clear definition of the work required through engineered standards and optimal methods for performing each task as efficiently and safely as possible. Based on this foundation and demand-based forecasts, workers are scheduled, tasks assigned, performance is measured, feedback is provided and incentives are computed and paid. In addition, online training is provided along with supervisor-based coaching to bring all workers up to required levels of proficiency. It is a complete approach designed to make a workforce as productive as possible, reduce labor costs, and improve customer servie.
Enterprise resource planning
Enterprise resource planning systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application...
systems. Recently, the concept of workforce management has begun to evolve into workforce optimisation
Workforce optimisation
Workforce optimisation is closely related to and an evolution of Workforce management and encompasses all aspects of managing the complete workforce lifecycle.-Definition:...
.
Specifically, workforce management includes:
- Payroll and benefits
- HR administration
- Employee self-service
- Time and attendance
- Career and succession planning
- Talent management and/or applicant tracking
- Learning management and/or training management
- Performance management
- Forecasting and scheduling
- Workforce tracking and emergency assist
Workforce management can also encompass field service management
Field Service Management
Field service management is an attempt to optimize processes and information needed by companies who send technicians or staff "into the field" . Optimization is difficult, since it involves intelligent scheduling and dispatching of multiple technicians to different locations daily, while...
. This provides software to optimally plan and dispatch field service technicians and their properly stocked vehicles to a customer's location in a timely manner in order to deliver against their service commitments. Field service management will itself include elements of:
- Demand management – to help forecast work orders to plan the number and expertise of staff that will be needed
- Workforce scheduler – using predefined rules to automatically optimise the schedule and use of resources (people, parts, vehicles)
- Workforce dispatcher – automatically assigning work orders within predefined zones to particular technicians
- Mobile solutions – allowing dispatchers and technicians to communicate in real time
Definition
In many markets and industries, workforce management is all about assigning the right employees with the right skills to the right job at the right time. The term is differentiated from traditional staff schedulingSchedule (workplace)
A schedule, often called a rota, is a list of employees who are working on any given day, week, or month in a workplace. A schedule is necessary for the day-to-day operation of any retail store or manufacturing facility. The process of creating a schedule is called scheduling...
because staff scheduling is rooted to time management
Time management
Time management is the act or process of exercising conscious control over the amount of time spent on specific activities, especially to increase efficiency or productivity. Time management may be aided by a range of skills, tools, and techniques used to manage time when accomplishing specific...
and simply manages the administration of past and future working times.
This traditional approach has since evolved into the more integrated, demand-oriented workforce management, which includes changes in personnel requirements and objectives when optimising the scheduling of staff. Besides the two core aspects of demand-orientation and optimisation, workforce management may also incorporate:
- forecasting of workload and required staff
- integration of employees into the scheduling process
- management of working times and accounts
- analysis and monitoring of the entire process.
The market for workforce management (WFM) is still quite young. In the eighties and nineties, entrepreneurs mainly focused on topics such as SCM
Supply chain management
Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers...
(Supply Chain Management
Supply chain management
Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers...
) or PPS (production planning systems) and, in recent years, on ERP
Enterprise resource planning
Enterprise resource planning systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application...
(enterprise resource planning
Enterprise resource planning
Enterprise resource planning systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application...
). As cost pressures have increased, managers have increasingly turned their attention towards HR issues. In all personnel-intensive industries, workforce management has become an important strategic element in corporate management.
Workforce management software
The workforce management software market is still immature. According to a study by SRH University of Applied Sciences Heidelberg, workforce management is an increasingly important issue for three-quarters of decision-makers in the top 1,000 companies in Germany – with an upward trend. But only about one-third of these companies actually use an appropriate software solution. Industry analysts such as AMR Research and DMG Consulting forecast that the market for workforce management software will experience dynamic growth.Workforce management solutions can be deployed enterprise-wide. While special software is commonly used in numerous areas such as ERP
Enterprise resource planning
Enterprise resource planning systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application...
(enterprise resource planning
Enterprise resource planning
Enterprise resource planning systems integrate internal and external management information across an entire organization, embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application...
), SLM
Service lifecycle management
Service lifecycle management is defined by industry analyst firm AMR Research and described as a holistic approach which helps service organizations better understand the revenue potential by looking at service opportunities proactively as a lifecycle rather than a single event or series of...
(service lifecycle management
Service lifecycle management
Service lifecycle management is defined by industry analyst firm AMR Research and described as a holistic approach which helps service organizations better understand the revenue potential by looking at service opportunities proactively as a lifecycle rather than a single event or series of...
), CRM
Customer relationship management
Customer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
(customer relationship management
Customer relationship management
Customer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
) and HR
Human resources
Human resources is a term used to describe the individuals who make up the workforce of an organization, although it is also applied in labor economics to, for example, business sectors or even whole nations...
(human resources
Human resources
Human resources is a term used to describe the individuals who make up the workforce of an organization, although it is also applied in labor economics to, for example, business sectors or even whole nations...
) management, the management of the workforce is often still handled by using spreadsheet programs or time recording. This often results in expensive overtime, non-productive idle times, high fluctuation rates, poor customer service and opportunity costs being incurred.
In contrast, by using a software solution for demand-oriented workforce management, planners can optimise staffing by creating schedules that at all times conform as closely as possible to the actual requirement. At the same time, a WFM solution helps users to observe all relevant legislation, local agreements and the contracts of individual employees – including work-life balance
Work-life balance
Work–life balance is a broad concept including proper prioritizing between "work" on the one hand and "life" on the other. Related, though broader, terms include "lifestyle balance" and "life balance".-History:The work-leisure dichotomy was invented in the mid 1800s...
guidelines.
A key aspect of workforce management is scheduling. This is achieved by establishing likely demand by analysing historical data (such as the number and duration of customer contacts, sales figures, check-out transactions or orders to be handled). Many workforce management systems also offer manual adjustment capabilities. The calculated forecast values are then converted into actual staffing requirements by means of an algorithm that is adjusted to the particular use case. The algorithm itself is based on the work of Erlang
Erlang
Erlang may refer to:* Agner Krarup Erlang , a mathematician and engineer after whom several concepts are named** Erlang , a unit to measure traffic in telecommunications or other domains...
though most modern adaptations of WFM have shifted towards a richer state management, and optimizations to the original idea.
Current and future staffing requirements, short-term peak loads, availabilities, holidays, budget allowances, skills, labour law-related restrictions, as well as wage and contractual terms have to be integrated into the planning process to guarantee optimal staff deployment. In the workforce management process, the integration of employees is an important factor. In several WFM systems, employees can log in their availability or planned absences and they can bid for specific shifts so long as they have the necessary skills for the activities planned for these shifts. Experience shows that professional workforce management systems realistically fulfil more than 80 percent of employees’ shift requests. Here, employee scheduling software
Employee scheduling software
Employee scheduling software automates the process of creating and maintaining a schedule. Such software will usually track vacation time, sick time, compensation time, and alert when there are conflicts. As a database of schedules are accumulated over time, it may analyze past activity and...
guarantees the best possible synthesis of optimised staff schedules and employee requests.
The more flexible the working time models and the more complex the staff scheduling becomes, the higher the requirements for correct time management
Time management
Time management is the act or process of exercising conscious control over the amount of time spent on specific activities, especially to increase efficiency or productivity. Time management may be aided by a range of skills, tools, and techniques used to manage time when accomplishing specific...
becomes. As time recording and accounting of working times are closely connected to scheduling, the integration of time management into the entire process is the logical consequence. Using workforce management systems, working times are booked exactly to the required time accounts and made available for payroll accounting by means of automated processes.
Many software solutions offer a number of options for evaluating the planning in real-time, enabling short-term reactions to deviations from the forecasted demand or expected over- or understaffing. Control functions enable a permanent adaptation of the scheduled staff to the actual requirements. In other words, the optimisation process allows for manual data adjustment in the case of short-term fluctuations in demand or unscheduled employee absences.
Workforce optimisation
Workforce management is itself evolving into a solution termed workforce optimisationWorkforce optimisation
Workforce optimisation is closely related to and an evolution of Workforce management and encompasses all aspects of managing the complete workforce lifecycle.-Definition:...
. This builds on workforce management to encompass all aspects of managing the complete workforce lifecycle and supports the business with key insights into how its workforce is performing. There is an emphasis not simply on improving operational efficiency or on managing the workforce effectively, but tying this to key business concepts such as the customer experience. The role of workforce optimisation is to tie together siloed systems and bridge between the three main stakeholders of HR, operations and IT. This approach is business driven. It involves automating entire processes, making key data more visible to support better decision-making, ensuring compliance with a wide range of relevant legislation and solving business problems related to staff. Workforce optimisation is best viewed as the next logical step in the move to optimise the performance of staff and to manage and understand the impacts of staff on both operational efficiency and the customer experience.
Workforce management provides a common set of performance-based tools to support corporate management, frontline supervisors, store managers and workers across manufacturing, distribution, transportation, and retail operations. The starting point is a clear definition of the work required through engineered standards and optimal methods for performing each task as efficiently and safely as possible. Based on this foundation and demand-based forecasts, workers are scheduled, tasks assigned, performance is measured, feedback is provided and incentives are computed and paid. In addition, online training is provided along with supervisor-based coaching to bring all workers up to required levels of proficiency. It is a complete approach designed to make a workforce as productive as possible, reduce labor costs, and improve customer servie.
Further reading
- Employee scheduling softwareEmployee scheduling softwareEmployee scheduling software automates the process of creating and maintaining a schedule. Such software will usually track vacation time, sick time, compensation time, and alert when there are conflicts. As a database of schedules are accumulated over time, it may analyze past activity and...
- Project workforce managementProject workforce managementProject workforce management is the practice of combining the coordination of all logistic elements of a project through a single software application . This includes planning and tracking of schedules and mileposts, cost and revenue, resource allocation, as well as overall management of these...
- Project managementProject managementProject management is the discipline of planning, organizing, securing, and managing resources to achieve specific goals. A project is a temporary endeavor with a defined beginning and end , undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value...
- Strategic service managementStrategic Service ManagementStrategic service management is a business strategy that optimizes a company's provided services through the effort of synchronizing: service parts and resources forecasting, service partners, workforce technicians, and service pricing....
- Field service managementField Service ManagementField service management is an attempt to optimize processes and information needed by companies who send technicians or staff "into the field" . Optimization is difficult, since it involves intelligent scheduling and dispatching of multiple technicians to different locations daily, while...