What is Workforce Managmenent (WFM)? (2024)

Effective workforce management encompasses all of the activities needed to maintain a productive and cost-effective workforce. This covers all the tasks and processes involved in efficiently staffing projects to ensure that the right labor mix is available—at the right time and cost. It also includes automating time tracking for all employees (including contingent and hourly shift workers) and managing absences and leave with consideration to regional labor laws and reporting requirements.

By providing integrated tools that extend beyond traditional compliance and automation activities, HR teams can become more strategic in how they deliver value to the rest of the business. As companies and employers have started to automate their time tracking, they’ve also increased their use of labor modeling and real-time analytics. Today’s leading HR systems are not a hodgepodge of disparate tools and legacy information systems, but strategic, connected, and integrated systems that meet the requirements of modern, digital enterprises.

WFM solution components

A typical WFM solution will include features that assist with tracking time and labor, scheduling workers, and managing absences. In addition to these fundamental processes, workforce management solutions may be extended to include workforce health and safety.

Time and labor

A time management system gives you visibility and control over your most costly and valuable resource—your people. It also ensures compliance with labor laws or labor union agreements.

Time and Labor (3:54)

Absence management

An application that enables you to manage employee absenteeism and comply with global leave regulations. An absence management application provides you with the ability to reduce the effects associated with absenteeism, such as increased costs and risk and reduced productivity.

Absence Management (4:06)

Workforce health and safety

This application enables organizations to easily and effectively manage environmental health and safety incidents. It improves the overall safety of your company by simplifying and automating the entire process including reporting, capturing critical information, and discovering the root causes of incidents.

Workforce Health and Safety (4:16)

What are the challenges of traditional workforce management solutions?

Every business is unique and has its own set of challenges. Your workforce management solution should address those concerns. Some of the most common workforce management (WFM) challenges include the following:

Time tracking

Time tracking impacts almost every employee in an organization. One of the biggest problems customers face with their current niche time and labor systems is the latency, or lack of integrity, of the data coming from their master HR system. Traditionally, time tracking has been confusing, slow, and highly error prone, which can result in unnecessary payroll costs and additional administrative burden. Even worse is the impact to employee morale when paychecks are inaccurate. No company wants to end up in court or have bad publicity because they paid their employees incorrectly or didn’t follow the law.

Represented workers

Represented workers generally enjoy significantly higher wages and better benefits than nonrepresented workers. Complying with these regulations can be very challenging for some organizations because of the complexity of the rules for seniority, tenure, eligibility, benefits, absence, and pay entitlements. Managing contract rules can become difficult without a comprehensive workforce management solution.

Represented Workers (4:11)

Absence management system

The lack of a reliable absence management system can result in increased costs and risk and lower productivity. Organizations need to address the diverse and complex requirements that result from managing absence policies around the globe. Absence management systems are often challenged by the unique rules and user interfaces required for different countries and regions.

Many organizations find it very difficult to get notifications of health and safety incidents in a timely fashion. Workers are unsure or uncertain as to whether they should notify their organization of near misses or unsafe conditions. Many organizations lack simple, intuitive tools that encourage reporting and minimize the obstacles for employees to report on past or potential incidents. Ultimately, organizations are held accountable for health and safety policies, so it is in their own best interest to implement modern, efficient health and safety management processes.

The top 10 benefits of workforce management

1. Automatic attendance tracking

Workforce management software automates attendance tracking, improving data accuracy and reducing payroll errors. With a comprehensive workforce management solution, organizations can offer multiple worker types an easy, intuitive way to accurately report hours worked and absences in real time.

2. Improved workforce productivity

A workforce management system reduces manual processes and enables you to better manage a full array of policies governing time and attendance. With improved visibility into hours worked, the availability of workers, and safety incidents, overall workforce productivity improves, and managers can ensure that staffing needs are covered and respond quickly if things change.

3. A safer workplace

A workforce management system can help you promote a culture of workforce safety and compliance while helping you manage environmental health and safety incidents more effectively. By streamlining and automating health and safety protocols—from reporting incidents to capturing critical information—organizations can ensure that the information is accurate and encourage employees to report health and safety issues.

4. Reduced cost

As the productivity of your workforce increases, workforce management costs can decrease as a result of more-streamlined processes, which means less time spent on administrative tasks. More visibility into employee availability and budgeted hours ensures the accuracy and authenticity of time worked and absences taken, decreasing staffing expenses from things such as incremental overtime or labor overages.

5. Employee engagement

Workforce management tools can improve employee engagement by helping employees to feel more productive in their work and to achieve better work-life balance through increased scheduling flexibility. By gathering employee sentiment in the moment and using employee feedback and preferences to influence workforce management functions such as scheduling, organizations can also give their employees a voice and improve employee empowerment.

6. Flexible scheduling

Many organizations struggle to manage employee schedules—specifically, matching work skills with business demands to maximize productivity and minimize costs. Workforce management solutions offer tools that enable managers to create schedules that align their workforce with anticipated (forecasted) demand, giving employees the freedom to manage their schedules with self-service tools.

7. Security

Some workforce management solutions use biometric data collection devices (for example, fingerprint scanners) to clock employees in and out, which helps eliminate “buddy punching”—the practice of one worker clocking in for another. In addition, location-based access to a web clock can ensure that workers only clock in from where they’re supposed to be working. Secure workforce management systems also have embedded machine learning that monitors for suspicious activity and for anomalies in the workforce management data to help prevent errors or fraudulent transactions going to payroll.

8. Business insights

Businesses can make better business decisions for the future with organizational and departmental data centralized in one workforce management system. Workforce management tools enable organizations to monitor overall company performance with real-time reporting.

9. Anywhere access

Workforce management solutions allow organizations to meet employees where they are to help them work more efficiently. Anywhere access empowers employees to perform tasks quickly and easily from their mobile devices, including clocking in and out, swapping shifts, requesting time off, and accessing information such as pay slips and W2s.

10. Fewer errors

Workforce management systems minimize human errors through automated time and attendance features. Automation ensures accuracy, eliminating data entry mistakes made using self-service time reporting tools. For example, by using robotic process automation, an intelligent system can listen for retroactive changes that may impact how an employee’s time should have been calculated and can then automatically recalculate an employee’s time and automatically send adjustments to payroll. Intelligent compliance alerts can also help ensure that an employee’s time is accurately recorded and that they adhere to their work schedules.

What are the functions of a workforce management solution?

Key considerations for choosing the best workforce management solution

For successful adoption of workforce management solutions, organizations should be able to apply the following best practices:

Make it easy for employees

Provide self-service time entry and management across the devices that employees use. Reduce errors and free HR staff by enabling employees to enter their own time and attendance data via time cards or other self-service user processes. Simple, mobile-responsive time entry, or a digital assistant for time and absence entry, make it fast and easy for employees to record the time they’ve worked. A good leave management solution provides full control when it comes to defining the rules and policies that govern absenteeism within organizations. Quickly configure period term, eligibility, accrual, entitlement definitions, and payment specifications to create absence plans. And configure absence validations, carryover rules, administrative tasks, and display appearances to create absence types.

Make it easy for managers and HR

Today’s modern, flexible time and labor and absence management solutions can be configured according to business and workforce needs so that managers can reduce the impact of unplanned absences and manage time by exceptions. Compliance alerts stop potential violations before they occur. These can be sent via text messages for quicker notification. A configurable rules engine and templates enable managers to design time cards to suit each worker—without involving IT.

Make it easy to connect enterprise employee data

Although a time and labor system offers plenty of benefits of its own, when such a system is integrated with scheduling, payroll, general ledger, project management, and core HR systems, the benefits soar. Indeed, organizations that integrate time and attendance with payroll see payroll processing errors drop, and time-tracking errors fall. Provide tight integration with payroll and time management systems. By drawing on data from payroll, time and labor, and core HCM systems, a robust leave management solution connects the dots between changes in leave and calculations in pay. Employees can schedule absences through a self-service or directly within a time card. Either way, the result is the same: complete visibility into time and leave management.

The future of workforce management

Changing markets, a heightened regulatory environment, and an increasingly diverse and dispersed workforce have made the job of workforce management more complex—and more essential. Without integrated workforce management technology, organizations will see their bottom lines suffer because they lack the ability to access the strategic insights necessary to determine where change is needed and align HR activities to business goals.

Effective workforce management encompasses time and labor management, absence management, and health and safety—and is fully integrated with payroll and other core HR functions and financial data—to bring accuracy, simplicity, and insight to a once-onerous task. The result is an engaged, productive, and connected workforce eager to contribute to organizational success.