Understanding Workforce Management: A Comprehensive Guide
👋 Welcome to our comprehensive guide on workforce management. In this article, we will explore the various aspects of workforce management, including how to calculate staffing requirements, the importance of queues, and how to control shrinkage.
Table of Contents
1. Introduction
2. Understanding Queues
3. Calculating Staffing Requirements
4. The Importance of Shrinkage
5. Outbound Processes
6. Key Takeaways
7. FAQs
Introduction
Workforce management is the process of optimizing the use of resources to achieve business goals. It involves forecasting the amount of work that needs to be done, determining the number of people or resources required to handle the volume of incoming work, and ensuring that the work is completed efficiently and effectively.
In this article, we will focus on the key aspects of workforce management, including how to calculate staffing requirements, the importance of queues, and how to control shrinkage.
Understanding Queues
Queues are a fundamental aspect of workforce management. Work in any business arrives and queues up, whether it is a call or a transaction. Understanding queues will help you determine the number of people required to handle the volume of work.
Most of us are familiar with queues because we would have encountered them in various real-life situations. Let's take the example of a movie theater. The ticket counters need to be adequately staffed so that customers do not have to wait for too long.
Consider that City Cinemas expects ten people to arrive at a time to purchase tickets. That is, there are ten people in the queue on average. If the ticket vendor takes about three minutes on average to complete the transaction, and the manager of City Cinemas decides that it is not appropriate to make the customers wait for more than seven minutes on average before reaching the ticket counter, how many ticket counters should be open for business?
Calculating Staffing Requirements
Before determining the number of resources required, it is essential to understand how queues work. This is because work in any business arrives and queues up, whether it is a call or a transaction. Understanding queues will help you determine the number of people required to handle the volume of work.
To calculate the number of ticket vendors required, you need to know the number of customers, ticket processing time by each ticket vendor, and the average wait time of the customer. Without these, you will not be able to accurately calculate the number of resources required.
To ensure that the average waiting time of the customer stays within the desired limits, you need the average ticket processing time by each ticket vendor and the number of customers in the queue.
If the service level is not in good shape, that is if the process is short-staffed, then each additional person makes a significant difference. This is the reason why staffing should be as high as possible during peak volume hours. If there is volume over forecast, then every resource available, including quality analysts, subject matter experts, team leaders, etc., needs to get into the act of processing transactions so that service levels can be maintained.
The Importance of Shrinkage
It is not good enough to go with the calculations we have learned so far because we would never really have a full person available to us all the time. For example, in a normal day, people will take breaks, attend meetings, etc. Therefore, they will not be available for work all of the time. We need to determine this loss, which is termed as shrinkage.
Shrinkage is the time lost due to various reasons, such as paid vacation, paid breaks, scheduled holidays, non-production-related work, etc. The second and third columns show how much time is lost in each of the categories. Approximately 36% of the paid time is lost due to shrinkage. This means if you hire 100 people, you are effectively getting time worth only about 74 people. To compensate for this loss, you need to hire 100 divided by 0.7, which is 135 associates.
Outbound Processes
In an outbound process, the customers in the queue at the movie theater are equal to the number of calls in the queue. The average ticket processing time becomes the average handle time or EHT, and the average wait time for the customer becomes the average wait time.
To calculate the number of resources required, you need to know the number of calls made, the contact rate, conversion rate, and the number of hours. To ensure that you maintain your sales levels, the two key elements, contact rate and conversion rate, need to be maintained at healthy levels. Poor performance will result in the hiring of more people, thereby affecting profitability.
Key Takeaways
- Workforce management is the process of optimizing the use of resources to achieve business goals.
- Queues are a fundamental aspect of workforce management.
- To calculate the number of resources required, you need to know the number of customers, ticket processing time by each ticket vendor, and the average wait time of the customer.
- Shrinkage is the time lost due to various reasons, such as paid vacation, paid breaks, scheduled holidays, non-production-related work, etc.
- In an outbound process, the customers in the queue at the movie theater are equal to the number of calls in the queue.
FAQs
Q: What is workforce management?
A: Workforce management is the process of optimizing the use of resources to achieve business goals.
Q: What are queues?
A: Queues are a fundamental aspect of workforce management. Work in any business arrives and queues up, whether it is a call or a transaction.
Q: How do you calculate staffing requirements?
A: To calculate the number of resources required, you need to know the number of customers, ticket processing time by each ticket vendor, and the average wait time of the customer.
Q: What is shrinkage?
A: Shrinkage is the time lost due to various reasons, such as paid vacation, paid breaks, scheduled holidays, non-production-related work, etc.
Q: What are outbound processes?
A: In an outbound process, the customers in the queue at the movie theater are equal to the number of calls in the queue.
We hope this guide has been helpful in understanding the key aspects of workforce management. Remember, to maintain healthy service levels, it is essential to adhere to break schedules, avoid late logins or early logouts, and control shrinkage.
