3 Reasons Retailers Should Leave Manual Workforce Management in the Past

Everything from holidays and weekends to business locations and weather patterns impacts each retailer differently. Now, as a result of the pandemic, inflation and increased popularity of online shopping, it has become especially difficult to forecast consumer spending habits and plan labor operations accordingly. This unpredictability has created two significant challenges for retailers still relying on manual workforce management (WFM) processes: how to accurately forecast customer demand and how to schedule the appropriate number of people needed to meet it.

Fortunately, the key to solving this headache is simple: ditch manual workforce management and utilize a WFM solution that delivers intelligent automation. 

Understaffing is just as bad as overstaffing

The ongoing labor shortage has had a significant impact on the retail industry, leaving organizations scrambling to cut business costs in any way possible. Oftentimes, this results in retailers looking to minimize labor costs by either downsizing their workforce or understaffing certain shifts – but this is a huge mistake. 

While retailers may think they’re saving money by understaffing, they’re actually missing out on potential revenue by not having the appropriate number of employees available to assist customers at any given time. For example, if someone goes to a store in search of a new pair of pants, but can’t find someone to help them access the dressing room or sees a check-out line wrapped around the store, they’re more likely to leave than they are to make a purchase.

Not only that, but retailers place a bigger burden on their managers by expecting them to figure out schedules that match their employee skills and preferences with business needs, especially when they’re operating with a reduced staff. In fact, according to a recent study conducted by Legion Technologies, 87% of managers are stressed or more stressed about staffing than they were last year, with labor shortages being a top concern.

Traditional, manual scheduling methods rely heavily on excel spreadsheets and past experiences, which leads to the challenge of creating schedules that meet employees’ needs while maintaining the business's bottom line. Modern WFM tools that enable intelligent automation remove the pressure of creating schedules by relying on memory and gut instinct. An AI-powered WFM platform can automatically assign shifts to employees based on their availability, preferences and skills to ensure schedules meet their needs and align the best employees with the store’s peak times.

Predicting demand doesn’t have to rely on best guesses

The other headache in trying to do things the old fashioned way is ensuring that customer demand is being met with the right number of people at the right place, doing the right thing at the right time. Not only is attempting to manually predict customer demand a slow, monotonous process, but this “best guess” method of demand forecasting is riddled with inaccuracies. When managers are trying to predict customer demand with no real-time insights or data to back their decisions it’s impossible to guarantee the appropriate number of employees will be staffed for each shift. 

This is because traditional demand forecasting methods don’t account for how factors such as evolving consumer behavior, local events and changes in the weather will impact customer demand. Managers relying on manual demand forecasting are left in the dark, using best guesses and gut instincts to drive their decisions when they should be using automated forecasts. According to the same Legion study mentioned earlier, many managers agreed that an automated demand forecasting tool would make their jobs easier. 

With AI-powered demand forecasting, retailers can accurately predict demand across all customer touchpoints to determine when and where employees are needed. Workforce management platforms that enable intelligent automation ingest and analyze thousands of data points to accurately forecast customer demand and create an optimized schedule in seconds. This enhanced speed and accuracy allows retailers to improve business agility and labor efficiency by continuously adapting to evolving business conditions as new data becomes available.  

Modern workforce management also drives employee engagement

While hourly workers make up the largest sector of our workforce, businesses across the retail industry are continuing to struggle to fill open hourly positions as these employees expect more from their employers – and will wait for a job that better meets their preferences. Aside from the operational benefits, modern WFM solutions are also equipped with tools specifically designed to enhance the employee experience. 

Outside of pay, Legion’s research revealed that the number-one benefit hourly employees want is flexibility in their schedules. Two-way communication tools allow employees to easily communicate with each other and their managers to swap, give up or pick up shifts, providing them with more control over their schedules. With this ability, employees can more effectively manage their work-life balance, while managers can drive employee empowerment through schedule ownership. 

The same report also showed that 37% of hourly employees would take on a new job if they received early access to earned wages. Rather than follow the traditional pay period, retailers should support their employees by giving them access to wages they’ve earned whenever they need it. Not only does earned wage access (EWA) support their financial well-being, but it’s been proven to increase employee retention and make recruitment easier – both of which are essential for retailers. 

Managers also have a better overall experience when using modern WFM solutions. Legion’s research uncovered that 28% of managers agree their employer could improve their experience by reducing the time they spend on administrative tasks. Managers experience increased burnout and stress when they’re stuck doing tedious, time-consuming admin work in the back office. By having those tasks automated, managers can put their time and effort into the more rewarding aspects of their job like engaging with customers and leveling up their employees. 

The retailers positioned to survive the ongoing labor shortage will be the ones that implement WFM platforms that enable intelligent automation to optimize labor efficiency and costs. Unlocking the potential of WFM technology will help retailers offer seamless experiences to both their employees and customers, allowing them to bolster employee retention while keeping their most valued customers happy. 

Michael Spataro is the Chief Customer Office at Legion Technologies.