Work It Out

Good help is always hard to find, but in retail, attracting and retaining workers is near impossible. How dismal is workforce loyalty in retail? According to “Future of Workforce Management for Retailers,” a report published by IHL Consulting Group, retail turnover in the U.S. is 200% to 300% a year.

Retailers face many challenges in staffing the store, from labor shortage and low unemployment to rising labor costs and increases in employee benefits. The options for dealing with this shortfall are grim: cut benefits, suspend raises, and reduce staffing levels — and in the process, lower service levels.

Or, you could turn to technology and try a workforce management system. While not a magic formula, WFM can help merchants meet employee preferences and store needs, improve employee performance for greater retention, provide training, and create a brand for employees as a good place to work.

What is WFM?

Workforce management (also known as workforce optimization) refers to any technology or business software designed to help organizations manage their processes for forecasting, scheduling, tracking, evaluating, and compensating employees. The goal is to have the right people, with the right skill sets, in the right jobs, at the right times, at the right cost, and on a consistent basis — so that you’re not overstaffed or understaffed. This helps decrease labor costs, while at the same time increasing sales by having enough workers in the proper locations.

WFM has been in place for years in manufacturing and distribution settings, and more recently in call centers. The technology works well in these environments, because workers tend to be centrally located and have regular shifts that change little, and turnover is relatively low.

Initially, WFM faced a challenge in retail because employees are dispersed, work varying shifts, and have high levels of turnover. Most WFM software didn’t offer enough flexibility, but system vendors have been addressing the issue for retail use.

The two most frequently used WFM applications among merchants are labor scheduling and time and attendance. WFM can generate employee schedules based on labor requirements for each location, while taking into account external regulations (laws related to minors, union policies, etc.) and employee preferences for time off and work hours. Such systems can schedule for stores, headquarters, call centers, and distribution centers.

A system’s time and attendance application tracks the actual working hours of store employees. It can also eliminate “buddy punching” (having coworkers punch in and out for workers) by using biometrics technology.

Some of the other WFM operations and store applications include:

  • Task management: helps schedule employees who perform different functions in the same locations, to make sure the appropriate number of workers are available for each function.

  • Forecasting and budgeting: provides a look forward into the future, especially to holiday and other peak periods, and can do “what if” scenarios on hiring needs.

  • Employee and manager self-service: allows employees and managers at each location to access their schedules from work or home by going on the Web. In addition, when workers need to change their schedules, they can post requests on the site and allow other employees to volunteer to swap or take over the shifts. Managers can also approve the switches online.
  • Leave management: coordinates requests for employees who seek leaves of absence.

Human resource applications for WFM include talent and performance management, government compliance and reporting, and litigation services. Other applications are recruitment, compensation and payroll, training (including e-learning), and employee separation.

“Retail operations people are looking for time and attendance, scheduling, budgeting, forecasting, self-service,” explains Pete Reilly, senior vice president and general manager, retail workforce management, for WFM provider RedPrairie Software. “HR people tend to look for things like talent management and performance management.” Reilly notes that RedPrairie offers WFM functionality only for retail operations users.

Benefits of WFM

Retailers can use WFM to leverage recent upgrades and investments in point-of-sale applications, hardware, and store systems to make associates more productive, says Gale Daikoku, research director, retail, industry advisory services, for Gartner Group.

The software can also automate labor-intensive processes associated with tracking time keeping and scheduling for store management. What’s more, WFM provides visibility to store-level performance within regions and comparisons with similar stores to benchmark performance and to highlight execution opportunities. You can also use the technology to standardize work and apply consistent labor standards across the store base.

Because of the significant organizational commitment and technical expertise typically required to implement WFM, it’s been a viable option only for sizable retailers. RedPrairie, for instance, focuses on retailers with 5,000 or more employees. “Over time, though, I think the technology will work its way to smaller retail chains,” says Reilly.

SD Retail Consulting, which primarily works with retailers to help with process and performance improvement, is “seeing quite a bit of interest in WFM in the midmarket — those chains with 60 to 150 stores,” says vice president Joe Madigan. “One reason is that, when implemented properly, it helps the stores function in a more uniform manner and forces execution in the stores to the company’s business plans.”

Centralized or decentralized?

With the advent of browser-based WFM technology, retailers have two options: a headquarters-hosted system, or a store-based system.

Until a few years ago, most WFM systems were located within stores, call centers, and other work locations, where personnel used technology that was client server-based. That is, each store maintained an insolated system, and managers created their own schedules, so headquarters rarely had access to what was going on at the store level.

The IHL report notes that, in the past, with batch systems stores would report data to headquarters, which would analyze it, and make decisions based on information that was hours, days, or even weeks old.

Today’s real-time environment allows information to be transferred instantly. As such, retailers can arrange to have their WFM systems hosted at headquarters or on in-store servers. IHL research has found that, while more than half of Tier 1 retailers had store-based systems in 2005, the trend was rapidly changing to headquarters-hosted scenarios.

Headquarters-based systems provide more functionality with less complexity. Browser technology advancements also enable managers to access data from anywhere — at headquarters, in stores, or from remote locations.

With the headquarters-hosted technology, personnel can use the Web to move schedules and other functions back and forth between headquarters and the stores and other locations. With the Web-based systems, the software is in place at headquarters, but can be accessed by authorized store-level personnel as needed.

For example, store managers can still make scheduling changes as needed, but now the headquarters instantly knows about the changes. In addition, headquarters can send out alerts if certain stores are exceeding their labor budgets. Headquarters can also set scheduling criteria to ensure uniformity and fairness.

“Almost universally, we are seeing the technology being deployed as a headquarters model,” says SD Retail’s Madigan. “The latest development has been centralized processing. Before, it was done in the stores, where the stores generated schedules.”

Another benefit is economies of scale for the IT department and increased data that provides knowledge of how schedules can perform better and how merchants can improve productivity at store locations. “A headquarters-hosted model also allows for closer monitoring of the link between customer activity and the things that drive sales, particularly staffing,” Madigan adds.

As with most software systems, it’s hard to get information on costs. How much you pay will depend on the type of system, the number and complexity of applications introduced, the type of business, the number of employees, the number of locations, the types of locations, where employees are located, and so on.

But Gartner’s Daikoku notes that in most cases, vendors charge a price per seat or per user. “Cost may also be affected by the total number of employees who use the self-service features.” She says that maintenance costs tend to run from 18% to 20% a year. “For some large retailers, a system may run north of $1 million a year, including maintenance.”

Seeking a supplier

According to Daikoku, merchants want store task management capability delivered in an integrated Web-based time and labor solution. Several vendors have systems with integrated time and labor capabilities, including task management, but few retailers have deployed a complete system from a single vendor.

When selecting a vendor, Daikoku recommends looking for the following capabilities:

  • Configurable rule engine: It should be able to configure business rules to fit the retailer’s environment (for example, California-mandated meal breaks, overtime, union rules, etc.).

  • Store task management: This function provides corporate visibility and enables event management of store-level execution of tasks, which helps to streamline workflow and generate exception alerts and store progress reports.

  • Automated learning: An educational or e-learning module to enhance training opportunities for the labor force, as well as to keep track of specialized skills/certifications for certain workers.

  • Functionality fit: This offers the ability to schedule and manage time for employees who have multiple roles within the same shift, and enables the retailer to share pool labor in multiple locations or for multiple retail banners.

  • Employee self-service: Enables associates to access schedules and assignments on-premise and off-premise, and also enables associates to swap shifts, check timecards, and view and request time off.

Some WFM vendor systems need to be linked to existing systems provided by that same vendor. The three vendors offering this model are JDA, Oracle, and SAP. These suppliers are developing a footprint for retail, but as noted, WFM is an element of using all of their other retail programs, such as financials and merchandising systems, rather than a standalone.

Other WFM systems are open to be linked to existing systems in the organization. Vendors offering this type of WFM technology include Kronos, RedPrairie, Reflexis, Workbrain, and WorkPlace. (RedPrairie specializes in warehouse management WFM technology.)

In recent years, these and similar vendors have made efforts to allow their hardware and software to be run on any open-system platform that a retailer may have in place. Many retailers appreciate this flexibility, because they don’t want to be locked in to any given vendor’s proprietary architecture.

Once you have identified your high-level goals, or what you want to accomplish with WFM, you need to specify system requirements. “It is important to document requirements across functions,” says Madigan. “This means IT, distribution, call centers, and stores, but it also means HR and finance.”

Not involving these latter two functions until later, he believes, creates a tremendous amount of rework. “HR deals with employees, of course, and finance deals with the payroll costs, which are some of the most significant in the company. Finance has a vested interest in making sure they have a say in how these costs are managed and controlled,” he explains.

The system should have the ability to factor task-based jobs into schedules, such as taking inventory or moving merchandise. While headquarters will probably have primary control over WFM activities, it should allow store level managers to make adjustments to fit last-minute changes or store-specific requirements.

Selling the staff on WFM

Experts warn that you should expect more turnover as a result of the introduction of WFM. “People have to grow into the application, and you will lose some people in the transition due to resistance to change,” notes Daikoku.

To get workers to buy into the system, use features such as employee self-service to show associates the benefits of the new applications. Benefits for managers include freeing up time to do things other than make schedules. Benefits for employees include the opportunity to go online to view schedules and swap with other workers.

“Training and change management approaches are crucial,” says RedPrairie’s Reilly. “You’re messing with people’s schedules in terms of when they work and how often they work, so you need to be very sensitive to this. For this reason, you need to spend time in the field explaining why you are doing what you’re doing, and also explaining what is in it for them.”

You should also validate time and labor standards in the field before building the business rules that will govern deployment. “Standards should be in place prior to starting the project,” adds Daikoku. Otherwise, she notes, your perception of how work is done in stores versus how you can use scheduling to optimize work will not be aligned.

“Consult with actual users and managers as early as possible during the testing of the concept,” she suggests. “Bad assumptions will always lead to poor results.”

William Atkinson, a freelance writer based in Carterville, IL, has written for Apparel and Risk Management magazines, among other publications.


Multichannel greeting cards and stationery retailer Papyrus used to struggle to achieve 10 drops an hour by its forklift drivers for replenishment and case picks, says WMS manager Del Duquette. “That group recently raised its minimum to 40 drops per hour, and the current average is 53,” he says.

How did the Fairfield, CA-based merchant manage this? Papyrus uses a RedPrairie warehouse management system as its WFM tool in its distribution facility. “We do not own RedPrairie’s labor module, but we do our resource staffing and leveling from within the WMS version that we run,” Duquette explains. Papyrus credits the system with being flexible enough to match its constantly changing business needs.

The WFM tool helped make processes faster, while the WMS improved accuracy. In fact, the retailer’s inventory accuracy is 99.95% on a consistent basis, which has allowed Papyrus to stop doing physical inventory. This means that the merchant no longer has to shut down product shipping for three days, Duquette says.

“We now run cycle counts that allow us to count our 30,000 locations a minimum of four times a year,” he notes. What’s more, the company’s fill rates on orders run 99.8% daily, with an average of 25,000 to 30,000 lines shipped.

A sample of major suppliers


WFM PRODUCT: Workforce Management 3G Suite

DESCRIPTION: Offers 100% Web-based integrated time and attendance, schedule and optimization, expense management, and self-service solutions available for in-house license or on-demand/ASP.

CONTACT: 877-274-4381


WFM PRODUCT: Workforce Management

DESCRIPTION: Provides projections of revenue, customer traffic pattern forecasting, advanced algorithm scheduling, time and attendance tracking, corporate labor reporting, operations management, and an employee portal.

CONTACT: 800-438-5301


WFM PRODUCT: Workforce Central 6.0

DESCRIPTION: Covers time and attendance, payroll, scheduling, talent management, and other applications. In combination, the applications allow users to improve staffing, development, deployment, tracking, and reward programs.

CONTACT: 800-225-1561


WFM PRODUCT: Retail Workforce Management

DESCRIPTION: Includes applications for forecasting, scheduling, time and attendance, budget, dashboard, employee self-service, and time clock. Interfaces with third-party HRMS, timeclock devices, and payroll systems.

CONTACT: 877-733-7724


WFM PRODUCT: RetailAction Suite

DESCRIPTION: Provides planning, executing and measuring for strategy creation, labor forecasting, labor scheduling, task management, performance measurement, and feedback leverage.

CONTACT: 800-781-3609


WFM PRODUCT: Enterprise Management and Support

DESCRIPTION: WFM is part of an offering that includes human capital management, corporate services, financial and management accounting, corporate governance, payroll and benefits administration, and other functions.

CONTACT: 800-872-1727


WFM PRODUCT: Stromberg Enterprise

DESCRIPTION: Web-enabled system to optimize time and labor resources. Can automate time and attendance; track labor hours and wages by department, cost center, and job; increase awareness of critical labor information; and streamline the payroll preparation process.

CONTACT: 800-787-6623



DESCRIPTION: WFM is part of a multifunctional platform; components include time and attendance, labor scheduling, and operations support (task management, new hire process, training and evaluation, and forms).

CONTACT: 801-990-0909

WORKBRAIN (now called Infor)

WFM PRODUCT: (Multiple)

DESCRIPTION: Offers workforce planning, time and attendance, data collection, workforce scheduling, workforce absence, labor productivity, and other workforce analytics.

CONTACT: 866-244-5479


WFM PRODUCT: WorkPlace Systems WFM

DESCRIPTION: Provides forecasting to predict demand for work, matches staff availability to demand for work, scheduling for new stores and peak periods, absence management, and time and attendance.

CONTACT: 314-416-7509











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