Three Ways Wal-Mart’s Labor Scheduling Overhaul Will Transform Retail
Optimized scheduling is evolving once again in the retail space. Not only must a retailer schedule the right person at the right place, time and budget to meet customer expectations, another factor is on the rise and is here to stay: meeting employee expectations.
Worker demand is extremely variable; odd and unpredictable hours are the norm; and upcoming overtime regulations are set to drastically impact workers’ hours. In addition to these challenges, seasonal changes and high turnover make it difficult for store managers to keep up and still achieve a work-life balance for their biggest asset.
Wal-Mart is one retailer that has announced that it will try to get ahead of this trend. In late July, the retail giant announced it will change employee scheduling systems and processes across 650 of its U.S. stores with the goal of improving peak hour staffing and provide more predictability over hours for employees.
Employee scheduling remains a challenge in the retail industry. According to a recent study by WorkJam, an employee engagement platform for the service industry, 89 percent of stores are understaffed each week. On top of that, 62 percent of managers say employees have quit their stores due to scheduling conflicts, which likely racks up serious turnover costs.
As the world’s largest retailer, Wal-Mart is a major industry influencer. Back in 2014 when it raised its minimum wage for employees, other big players including Target and Costco followed suit. Making changes that are focused on improving employee scheduling could be similarly impactful. Here are three trends expected in the coming years as retailers begin to follow Wal-Mart’s lead and boost their own employee engagement initiatives:
Scheduling will be based on employee input. Wal-Mart’s plans will attempt to give employees more power over their schedules, which reflects a broader industry shift toward improving employee well-being. More companies are allowing workers to accommodate their work schedules around home life, rather than vice versa. As greater emphasis is placed on a work-life balance in this industry, employers will need to find a way to accommodate time-off requests and shift swap preferences. According to WorkJam’s most recent study, only 28 percent of retail managers are very satisfied with their workforce management system’s ability to create schedules that accommodate both store labor needs and associates’ preferences. This could explain why employers are shifting away from traditional scheduling systems and toward those that allow workers to create their own schedules, resulting in increased ROI.
Staffing will become more predictable. By prioritizing employees’ well-being with consistent schedules, Wal-Mart plans to eliminate most on-call scheduling. This will be a complete game-changer, as the majority of America’s hourly workforce currently struggles with inconsistent work schedules. Wal-Mart’s plans to provide workers with their schedules at least two weeks in advance and eliminate on-call scheduling, a controversial practice that has been protested by workers’ unions. Other retailers will likely follow in Wal-Mart’s footsteps in order to eliminate the stress of understaffing during busy hours and ultimately decrease employee turnover. With more companies adopting employee-centric scheduling models, on-call scheduling will likely become a thing of the past.
Employee engagement will be a top priority. The long-term benefits of Wal-Mart’s planned changes will likely put employee engagement at the forefront of the retail scheduling conversation, and more companies will begin to understand the ROI of cultivating a motivated and loyal workforce. Workers who receive consistent schedules that balance well with their personal lives are more satisfied at work, which in turn increases retention. As retail traditionally sees high turnover rates, higher retention means less money spent on hiring and onboarding new employees. Further, increased employee morale will show through in the quality of customer service. Employees that are happier at work will perform better.
Though Wal-Mart’s system is still being tested in a limited number of stores and its technology has yet to win over employees and labor groups, it is a start in the right direction and will affect more than just Wal-Mart and its hourly employees; with such a big name in retail acknowledging the benefits of pursuing employee engagement initiatives, other stores will certainly follow.