It's no secret that employers face challenges – and one of the biggest headaches at the moment is how to manage, recruit and retain staff while trimming costs and improving service. Here, we look at how today's workforce management and people technology platforms can help. Rosalind Mullen reports.
One statistic that stands out around labour costs is that inefficient shift scheduling could be costing businesses up to 40% of income. With many hospitality businesses operating under thin margins and facing increased pressures, accurate scheduling and forecasting to ensure the right labour distribution is vital.
Last-minute rotas are also seeing disgruntled staff vote with their feet. Why? Well, because post-pandemic, your employees increasingly value their work-life balance and if you don't look after their physical and mental wellbeing, you will lose them. Worse still, you may find it expensive and difficult to replace them. According to the Office for National Statistics, job vacancies in the UK rose to a record 1.2 million in September – and the hospitality sector has more staff shortages than most.
However, there is a suite of techno-wizardry that aims to help with all this – and much more. Workforce management software (WFM) sets out to simplify the complex tasks of scheduling, time-reporting, communicating, budgeting and forecasting of hospitality workers. Giants such as McDonald's, Domino's, Hilton, Benugo and Starbucks, for instance, already use it to reduce labour costs, remain compliant, and improve workforce productivity – all while boosting the bottom line, employee satisfaction, and retention.
Providers of WFM are predictably going to sing its praises, but they can also cite evidence that it works. "Our customers – which in the UK include Odeon, Benugo and IHG – report up to an 80% reduction in admin time, plus up to 10% labour cost reduction, as well as increased productivity, and up to 100% labour law compliance," says Daniel Holmberg, country manager at Quinyx UK.
In its annual study Quinyx, which provides AI-powered WFM software to 850 global companies, found that a third of respondents had left a job in the hotel and foodservice sector because their employer didn't provide schedules with enough advance notice (a week or more) making work-life balance difficult. And some 49% said their place of work was understaffed, which led to a stressful environment.
It also found that companies not using WFM technology on average overspent by 25% on salary costs and lost up to 15% revenue, due to ineffective schedules.
So, in a post-pandemic world, the potential of WFM is obvious, says Holmberg. "There's intense competition for labour right now. It's unprecedented – Domino's is seeking to hire 8,000 delivery drivers, for example. What can Domino's do to compete with other businesses in filling those vacancies? You can only raise wages by so much. What it can offer instead is ensuring employees get a schedule they actually want to work – one that benefits the business and the employee – and that's what we can help them do. It is the companies that are using automated solutions that have navigated the uncertainty of the past two years."
An effective WFM system is two-way, with a mobile-friendly user app for employees to communicate with managers and request shift-changes and holidays.
"In many businesses, this type of admin is done on spreadsheets or in a separate system, with huge potential for confusion – for example, leave requests being overlooked. It's time-consuming for managers and painful for employees," says Holmberg. "The app removes the stress of organising shifts. It provides seamless real-time communications and flexible scheduling that staff can access whenever they need to."
While the manager still authorises shifts, the self-service portal empowers employees and means they can also flag up their availability, which is particularly useful in multi-site companies.
"In an environment where whole teams may be forced to isolate if one member becomes unwell with Covid-19, the value of advertising available shifts online across different sites in a group offers huge potential for business continuity and employee satisfaction," says Henry Seddon, managing director at Access Hospitality.
A significant financial benefit of WFM is that businesses can manage labour costs. At the press of a button, operators can get a real-time view of expenditure and calculate wages as a percentage of sales.
"It provides the tools needed to optimise labour costs while considering other factors, such as sales results, forecast demand and the performance of individual locations or events," says Andrew Northcott, chief executive and founder of Roubler, which provides cloud-based one-stop-shop software. "This enables managers to operate within their assigned budget, schedule staff according to demand, understand sales versus labour costs, and gain visibility cost centres. Armed with this information, they're able to make [informed] decisions – contributing to increased performance across the business" (see case study).
Some of the latest software can look further ahead, too, such as Quinyx's strategic planning algorithm. "Through AI technology, it helps business leaders make long-term, data-driven staffing and budgeting decisions, so you can plan and predict the workforce you will require in three, six, 12 months' time," says Holmberg. "It can be used to model ‘what-if?' scenarios, too, so users can model the business impact of significant sales increases or decreases, or of store openings, and work out how much labour they might need in different situations. It would allow users to adjust budgeting based on the Living Wage increase, for example."
Pay as you go
On the subject of wages, on-demand pay is becoming as important as managing rotas when it comes to staff retention. This technology has made a difference at Gusto Italian, says chief executive Matt Snell. Speaking at a recent Access Hospitality webinar, he said: "I think [staff are] much more likely to stay with us because they get their rotas two weeks in advance so they can plan their lives, so they get regular time off, so they're not working 60 hours a week, so that they are able to access their rotas online, so that they can draw down wages before being paid."
Seddon comments: "[Giving employees] the option of drawing down wages when earned with a system such as Access EarlyPay enables them to work additional shifts when needed in the knowledge that they don't have to wait for a formal payday. In post-pandemic life, this flexibility [allows] them to be in control of their own life and finances."
Cloud-based software can also help with recruitment and onboarding by enabling managers to define workflow priorities, attract and manage candidates throughout each stage.
And as canny operators know, being able to demonstrate you offer a robust staff training and development programme is key. End-to-end cloud-based training software simplifies an employee's training path. It manages internal and external development programmes which integrate staff training absences and pay rates into operational rotas and automatically updates qualifications in the HR system.
"If staff have access to self-service portals for training as well as shift planning, they can take a more active role in their own development and working life," says Seddon.
So, are there any downsides? Seddon says that when considering WFM technology, it is important to balance business needs, employee satisfaction and customer sentiment. Recent Access research (conducted by CGA) found 40% of hospitality customers thought less interaction with staff to book, order and pay was the biggest downside of technology, but 28% agreed that technology improves their overall experience in pubs, bars and restaurants.
Interestingly, 24% of consumers believe that staff are now treated better than they were before technology was widely used. The most important factors that would encourage customers to use technology more were if they knew tips were going direct to staff (25%) and if they could still interact with staff (24%). "Promoting a positive working environment and having a well-defined, transparent tips policy not only creates job satisfaction but also has an impact on guest feedback and return visits," says Seddon. "Using WFM to encourage employees to do brief, but regular surveys, gives maximum feedback across sites to assess general health and wellbeing, basic working conditions and best practice that can be shared and recognised."
A modern WFM system is also an effective platform for staff communication and engagement. In the event of another lockdown, that could help engage employees with news updates, information on protective measures, and up-to-date details of who is off sick. This digital communication is vital in both times of crisis and in a day-to-day working environment.
Case study: the Capital Hotels & Apartments, South Africa
The Capital Hotels & Apartments started in 2008 and has become the fastest-growing hotel group in South Africa, even throughout the challenges of Covid. It has expanded from 190 staff to 650 and is onboarding 240 recruits across three new hotels, taking the current total to 12.
The team needed a more agile workforce management system to support expansion. Previously, without an all-in-one system, employee information was fragmented and managers were spending valuable time onboarding and rostering staff. With no central place to manage teams and view workforce data, senior leadership lacked insight into where they could be making gains in terms of efficiency.
The Capital Hotels chose Roubler's system covering the employee lifecycle from onboarding, to time and attendance and rostering. They now have oversight across the entire group to ensure employees are working the right hours and being paid correctly in each location.
"At site level, new staff are onboarded faster, managers spend less time on admin and save valuable time with features like smart rostering and leave management in the mobile app, allowing them to focus on providing an exceptional customer experience," says chief people officer John Skelton.
"Employees' lives are easier with the mobile app. They can view their roster, book leave and update personal information, without the need to log in to different systems or request information from HR." When Covid hit, the system's flexibility was crucial, not just because rules on travel were changing, but to help with new procedures and keep service levels smooth. For instance, its properties were used as a quarantine base throughout lockdown and so had to manage a large influx of guests at short notice.
"Roubler helped us to galvanise the workforce with speed, as management could create rosters at the click of a button and notify staff of upcoming shifts automatically via the mobile app," says Skelton. "This flexibility to manage changing workforce demands and work patterns has been key to our ability to continue to scale."
Roubler's API allows data exchange between platforms so there is no need for data imports, fewer errors, and streamlined operations. The system integrates with accounting software, e-learning platforms, point of sale systems, job boards and operations software.