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To really do labor management correctly, especially in a multitask, high-employee grocery environment, you have to drill down to capture the details of work, say consultants and software suppliers.
Using broader-stroke, older methods -- applying labor as a percentage of sales or man hours -- to forecast hours to schedule work isn't sufficient in today's competitive market. And it won't result in the labor efficiencies and savings needed to impact margins, they note.
"You have to build labor budgets from the ground up, based on actual work and volume movement data," says Rick Schlenker, co-founder and SVP marketing and sales at Dallas-based Logile.
The provider is doing just that with Weis Markets, in Sunbury, Pa., a 166-unit chain that reported $2.6 billion in revenue last year and has a labor force of about 18,000. That means introducing engineered labor standards, a measure that gives true work content, and the time associated with performing the work, into Logile's store modeling process.
Such standards are critical in the activity-based costing modeling that Dorset Consultants, in North Andover, Mass., uses in its Optimizer forecast module. The consultant is currently working with Kansas City, Mo.-based Balls Food Stores to implement Optimizer forecasting.
"It's the hands-on model building and standard practices and operational concepts that deliver you the results," says John Connolly, who works in partnership with Dorset on retail projects. "The software is just a tool, a calculator."
He adds that in labor management forecasting, detailed work analysis, which is customer-, operations- and activity-based, can deliver on average a 20 percent productivity improvement in store labor. That translates to having the right amount of labor, at the right time and in the right places of a store operation.
Questions to Ask
Suppliers say to consider the following before investing in workforce management (WFM) software.
Howard Tarnoff, SVP customer success, Ceridian, Minneapolis
Can the system be configured to encompass a retailer's operating model?
Does the retailer have domain expertise to ensure a partnership with the software supplier?
Is there peer validation to attest to the quality of the solution and share best practices?
Liz Moughan, director, retail practice group, Kronos, Chelmsford, Mass.
Is the system easy to use, easy to deploy and easy to maintain?
Is WFM data accessible when and where a retailer needs it?
Is data in real time around key performance indicators?
Rick Schlenker, co-founder and SVP operations, Logile, Dallas
What other retailers are using and have experience with the vendor's products and services? What have been the results?
Is the WFM supplier's main focus on WFM, versus a supplier that offers broad-based logistics?
What are the retailer's strengths and weaknesses in labor management?
By Christina Veiders