What Is Workforce Management? (2024)

Workforce management is a set of processes employers use to direct staff members to be in the right places at the right times in order to reduce risks and maximize productivity. It’s a top-down approach that starts with leadership creating defined strategic goals so that organizations have clear direction as to how future decisions will be made.

The concept of WFM originally began in call center environments in the 1980s as a way to improve consistency and efficiency, and has since expanded into a wide variety of industries. Businesses implement WFM to help improve time management, forecast workloads, offer analytical insights and expedite the employee scheduling process.

The best WFM system is one that finds the optimal fit between the amount of work required and the amount of staff needed to handle that work. Building an effective system takes time, so don’t expect results overnight. Most companies must follow a series of steps when implementing a WFM strategy:

1. Strategic Direction: Leadership sets both short- and long-term objectives, then figures out how the workforce needs to be aligned to meet those goals.
2. Analysis: By gathering data and auditing the current workforce, organizations are able to establish where there are overlaps and gaps in processes.
3. Identify Solutions: There are all sorts of tools and software that can be used to apply WFM principles, and choosing the best ones will ultimately depend on both the current workforce and future objectives.
4. Standardize Procedures: Once the right WFM solutions are in place, create standardized procedures for the entire workforce.
5. Implement Automation: Adding automation wherever possible means a more streamlined WFM process that will maximize productivity and reduce costs over time.
6. Monitor Progress: As objectives change, WFM systems will as well, so be prepared to monitor progress, assess performances and make adjustments as needed.

Once an effective WFM system is in place, businesses will begin reaping the benefits almost immediately. The largest and fastest advantage will be an increase in productivity, as many time-wasting activities will be either reduced or eliminated completely. Automation will lead to less errors, improved safety and more consistent production. And more streamlined processes means a lighter workload, resulting in boosted morale and happier employees.

Key Aspects of Successful Workforce Management

Since every organization is unique, each WFM strategy needs to be unique as well. Because of different goals, requirements and demographics, there is not a one-size-fits-all, cookie-cutter approach. But no matter the industry, there are several key aspects to every successful WFM strategy:

Time Management and Scheduling: Tracking employee hours is one of the most important aspects of workforce management. Having a scheduling system in place allows for optimal time management and productivity, along with more streamlined delegation.

Forecasting and Budgeting: Using WFM to analyze past and present often provides valuable insight into both business and team operations. This information can be used to forecast future trends and budget appropriately for expenses such as labor costs.

Payroll and Benefits: Many WFM software packages have the ability to generate custom reports that provide information about payroll administration, employee benefits and fiscal year data needed for taxes.

Data Reporting and Analytics: WFM metrics are indicators that reveal the efficiency and effectiveness of onboarding, training and proficiency. It offers a way to measure the effectiveness of teams, as well as illustrate areas that need improvement.

Compliance and Mitigating Risk: Reducing risk and staying compliant are essential components for any organization, and are often time consuming undertakings. Using WFM tools to organize, optimize and track essential information allows businesses to stay on top of crucial compliance measures.

Recruiting and Applicant Tracking: An effective and efficient WFM program will help human resources departments be better equipped to recruit the right employees for the right areas.
Workforce management can identify the needs of every department, match skills with positions, recruit team members and retain employees.

WFM tools are industry-specific solutions that assist management in achieving their objectives and goals. Some organizations opt to use WFM software that operate as stand-alone programs, while others incorporate these tools into an integrated human resources (HR) management suite. WFM products have become even more valuable over the past several years, due to the significant increase in remote and hybrid workers.

Some of the core components of WFM tools include measuring the working time and absences of workers, and sharing this information with payroll and HR; compliance with agreements pertaining to pay and leave; creating efficient and fair work schedules; and tracking employee productivity. Depending on the WFM solutions an organization chooses to use, the monthly costs can range anywhere from $2.50 per user all the way up to $72 or more per user.

Some of the top providers offering the most reliable and accessible WFM tools include:

WFM is important because it helps create a framework for effective scheduling, forecasting and budgeting in order for businesses to effectively run their operations. Through the use of automation and other tools, organizations are able to plan and meet strategic goals, while also improving efficiency. The result of finding and implementing the right WFM system for your industry is a happy, responsive workforce that is performing as optimally as possible.