Why Employee Scheduling Software is a Valuable Enterprise Investment
To drive profits and gain or maintain competitive advantage, modern businesses need to be efficient and deliver high-quality services and products—ensuring availability to customers at all times. This requires streamlined workforce management, which means that companies need to forecast labor requirements and create smart, error-free schedules. The only way to achieve this is to integrate a smart scheduling system into everyday business practices.
Leveraging legacy HCM/WFM software is a losing battle
Antiquated scheduling systems have a detrimental effect on business productivity, as they fail in three key aspects.
- These systems don’t integrate with critical business aspects, such as payroll, labor costs, onboarding, or training. Without this integration, managers and HR professionals will be spending a significant portion of their time performing double data entry—entering key information manually between software platforms, and manually calculating employee hours and costs. This manual data entry between software is not only prone to human error, but it’s also inefficient, time-consuming, and is a significant source of costs—costs that could have been easily avoided with an automated scheduling solution.
- These systems don’t support the dynamic nature of today’s real-time work environment. Schedule changes, employee availability, and time off requests need to be factored in into each schedule, and a manual, obsolete solution simply cannot support it.
With a smart scheduling platform, you can communicate last-minute schedule changes across the board, allow employees to trade and swap shifts without requiring your intervention each time, and get notified about upcoming leave requests to ensure your schedules are error-free. The bottom line is fewer missed shifts, better labor allocation, and lower labor costs.
- Bad workforce scheduling systems aren’t smart. These antiquated solutions: won’t warn schedule makers about shift conflicts; can’t automatically schedule employees with the right skills when needed, and won’t ensure you are compliant with labor law requirements regarding the maximum hours worked or overtime. Moreover, forecast scheduling needs are a manual effort, which can result in faulty schedules, and create additional costs.
Compounding these operational and financial issues are often overlooked, indirect costs.
Indirect costs of poor scheduling
The financial costs that arise as a direct consequence of poor scheduling are not the only costs you need to worry about. Let’s have a look at a common workplace scenario to see just how dangerous and costly a lack of an efficient scheduling process can be.
For instance, an employee scheduled to work an afternoon shift calls in sick. With a spreadsheet at their disposal, supervisors need to manually search for an employee to fill in the shift. As a result, they will be far less effective and will, in turn, need to work overtime (or long hours) to compensate.
One option is for the manager to find a potential replacement, but there is no way to check whether that employee is adequately trained. Not only do you risk a tarnished reputation and poor customer service, but potential safety issues can arise resulting in worker’s compensation claims and/or medical costs.
Another option is that the manager cannot find anyone to fill in the shift. This is a common scenario since, with a legacy system, there is no way to quickly find employees who are available and who want to work a particular shift before that shift begins. Missed shifts, such as in this scenario, can result in lost sales, and dramatically reduce business productivity.
Finally, let’s assume that the manager finds an employee who has already been working their regular shifts. As business demands it and since they do not want to risk their job, employees accept to fill in this shift, but not without a cost. Employee fatigue can result in poor quality of customer service, reduced sales, and negative customer experiences. And that’s not all—low morale among employees who have to fill in due to inadequate staffing, leads to employee attrition, hiring, and training of new employees, costs of which are enormous.
What is the cost of a scheduling platform, anyway?
In industries such as retail, healthcare, education, and manufacturing, scheduling plays a huge part in the day-to-day business. It comes as no surprise then that a recent Gallup report revealed that scheduling issues are among the top five reasons why employees leave organizations.
Add to that the fact that 30% of new employees quit within their first six months with a company, and it becomes clear that employee retention should be a top priority. If companies want to prevent the loss of talent, they need to dramatically improve their scheduling processes.
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The hard truth is that in these industries, poor scheduling brings about a whole bevy of workplace problems, including employee attrition and absenteeism.
To replace an entry-level employee costs anywhere between 30 and 50 percent of their annual salary, while in the case of highly specialized employees these costs go up to 400% of an employee annual salary. This means that you will be spending $480,000 to replace a senior executive whose annual salary was $120,000, and about $16,000 to replace an entry-level employee whose salary was $40,000.
Workplace absenteeism is equally expensive. Sickness or missed shifts happen every day across industries around the world, and costs companies millions of dollars each year: roughly $3,600 per year for each hourly worker and $2,650 each year for salaried employees5. Compared to these costs, a smart scheduling platform is a bargain.
Benefits of smart scheduling
Now that we have looked at the costs of inefficient, legacy scheduling systems, let’s examine the benefits of a smart scheduling platform.
Dynamic, cloud-based scheduling allows the creation of customizable, rule-based schedules and ensures proper staffing based on forecasted needs. The results? Complete shift coverage and the elimination of overstaffing costs. With automatic conflict checking, you can ensure the right staff is working the right shift in accordance with skills, compliance, and availability.
A leading workforce management platform will also support time clock functionality, ensuring staff is paid accurately, absenteeism is under control, and managers have real-time insight into overtime. Plus, by allowing the optimization and creation of accurate shifts, a robust scheduling platform allows you to control labor costs.
Investing in a smart scheduling platform is a must. With the right platform installed and integrated, organizations will reduce labor costs, curb absenteeism, ensure high customer satisfaction, and above all help your employees tap into their full potential.