Today's post is submitted by Joyce Maroney, Executive Director of the Workforce Institute. Black Friday is upon us, and retailers everywhere are scrambling to get ready for lots of shoppers and extended hours to staff. Are you ready?
No-shows, call-outs, and last-minute schedule changes aren't just frustrating–unplanned absence is corrosive to the day-to-day operations at retail stores across the globe.
According to a recent survey by The Workforce Institute at Kronos Incorporated, retail managers across six global regions revealed that last-minute absenteeism leaves their stores understaffed a quarter of the time, while more than half of retailers surveyed (52 percent) cited unplanned absence as one of their organization's most difficult, complex, and time-consuming issues.
The pervasive issue of unplanned absence
Regardless of country, employee head count, or sector–from grocery to warehouse, convenience, or department stores–the challenges posed by unplanned absence are universally felt and can directly impact a store's bottom line: Retailers surveyed acknowledge that at least one in 10 in-store labor hours budgeted is wasted due to staffing misalignment resulting from absenteeism.
“Imagine if companies were wasting 10 percent of their product, or losing 10 percent of their revenue. Retailers would immediately put in place a task force to solve the issue,” says Workforce Institute at Kronos board member Mark Wales, a leading retail industry advisor and global expert in next-generation workforce management. “However, with workforce management being a traditionally less-than-sexy topic, this flies under the radar and the consequences of unplanned employee absence, although severe, are far from being resolved at most organizations.”
This isn't to say that retailers haven't been working to get ahead of the absence curve. Particularly as the holiday shopping season draws near, it's not uncommon for managers to proactively overschedule a busy shift in anticipation that associates may call out. Yet this attempt to address the problem can often lead to more issues: Without accurate and actionable data to inform when and where additional staff support will be needed, overscheduling can lead to wasted labor hours–both for managers and their staff, who ultimately feel underutilized and unchallenged.
On the flip side, managers who don't overschedule run the risk of needing to fill vacant shifts on the fly. This causes unnecessary stress for store managers who find it challenging to deal with associates working additional shifts beyond their scheduled hours–especially if they incur overtime. The impact of filling these shifts on short notice also means that one in four (26 percent) retailers are working with staff that have the wrong skills or a lack of skills at least half the time. Not to mention, tapping into overtime and increasing individual workloads can swiftly impact morale of current employees–in fact, they've been found to be two of the three largest contributors to burnout.
Smart solutions for smarter workforce management
It remains challenging to identify the root causes of unplanned absence, and the study suggests retailers may not be doing all they can to address the issue. Findings reveal that only about half (55 percent) of retailers worldwide have technology in place to help manage unplanned absence compared to three-quarters of retailers using automated technologies to track time and attendance (76 percent) and manage planned absence (73 percent). And although more than half (59 percent) of retailers worldwide believe scheduling technology has a positive impact on staff productivity, more than a quarter (28 percent) are still using either spreadsheets or pen and paper to manage staff schedules.
Most retailers are embracing at least some workforce technology–yet increased adoption, particularly of solutions that specifically manage unplanned absence, would enable more managers to identify and analyze stable schedules that promote strong teams, assign shifts based on associates' preferred availability, and automate shift-swapping approvals to ensure real-time coverage for vacant shifts.
But there's good news for retailers hungry for new technologies that can help solve their staffing issues. Not only do these solutions already exist, but they're getting smarter. Recent innovations have delivered workforce management technology that can meet the expectations of workers who otherwise run their lives on their smartphones. Retailers can provide their associates with friendly self service solutions that support their needs for flexibility by empowering them to use those smartphones to request time-off, swap a shift, or request a schedule change. Employees who can collaborate with their managers to select shifts that fit their needs are less likely to call out at the last minute. At the same time, those solutions can also capture the attendance patterns and labor insights managers need to effectively schedule their teams and drive sales.
Boosting both employee engagement and the bottom line
Solving the unplanned absence equation can significantly reduce operating costs. According to the U.S. Department of Labor, labor costs on average represent as much as one-fifth of retailers' total revenue. According to retail managers in our survey, a new absence and shift-swapping solution has the potential to reduce overall labor costs by nearly 3 percent. In addition, our retailers worldwide are optimistic that an effective absence management solution could reduce unapproved absence rates by 18 percent on average.
The key is to empower employees with technology that enables them to manage their work schedules in a way that simultaneously supports their need for flexibility while still delivering the coverage and productivity required by their employers. Accurate and automated absence management technology can allow managers and teams to collaborate more effectively to maximize productivity and deliver an exceptional customer experience.
Now more than ever, retailers have an opportunity to deliver a differentiated customer experience by investing in technology that will enhance their associates experience. Associates who can work the hours they need while still attending to their lives outside of work are going to be more engaged, loyal, and effective at work. And they're going to be the kind of ambassadors who'll keep your customers coming back for more.
This article by Joyce Maroney was originally published in Chain Store Age.
Shopper photo originally published in the Boston Globe.
OK - I borrowed the title from a Steely Dan song from one of my favorite albums (link provided for those born after 1970). The song refers to a few cataclysmic events. For retailers, it refers to the day after Thanksgiving - when the holiday shopping begins in earnest, and retailers' financial fates are in the hands of the consumers. Retailers are worried this holiday season as the mortgage market does the mambo, oil hits $100 per barrel, and the average consumer may be inclined to limit the holiday budget while waiting out the storm.
In partnership with Retail Systems Research, we've recently concluded a survey of major retailers entitled "The State of Retail Workforce Management". You can download the full text of the survey from their website. This research is especially timely as it highlights the balancing act retailers need to achieve between customer service and expense management. From the Research section of this site, you can download “Customer Centricity's Impact on the Workforce”, by Nikki Baird, Managing Partner at RSR Research. This article summarizes the survey findings and describes how management practices for the retail workforce and the tools used to manage the workforce must change if retailers are to survive in a customer-centric environment.
Among the principle findings of the survey is that while retailers almost universally cite their workforce, and specifically their customer facing workforce, as their most important asset, many still treat their workers as a means to an end vs. a strategic asset. There are some exceptions out there. In his blog HRCleanUp, my friend Jay Hargis cites customer service leaders like Starbucks and In-N-Out Burger that offer their employees benefits and seem to reap the rewards in employee and customer loyalty. A recent Boston Globe story indicates that some retailers are rethinking the marathon hours for their employees, and foregoing 5 am opening times in favor of having well rested employees who they believe will produce a better result for them.
I'd love to hear from you about retailers you think are doing a great job balancing employee satisfaction with business results. Happy shopping!
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