As workplace and workforce dynamics evolve, the engagement of employees becomes more critical to all employers. Pursuing initiatives that facilitate happier, motivated and loyal employees isn’t just for companies looking to wind up on a “best places to work” ranking – it can yield tangible, lasting business benefits. Recently, Gallup research found that fostering an internal culture of engagement can result in almost 20% higher revenues per employee.
The service industry is a prime candidate for better employee engagement strategies. Worker disengagement is a pervasive problem for retailers, restaurants and other hospitality businesses, especially at the hourly employee level. Retail turnover in the U.S. has hovered around 56% in 2015, and a plethora of new jobs (the sector added 48,000 in March alone) gives employees the leverage to jump ship when employers don’t meet their needs.
Despite the buzz around employee engagement, less has been said about what employers can really do to improve it. In the service industry, generating engagement doesn’t have to be a standalone initiative, or one that’s isolated from employers’ in-store operations. By transforming existing processes – particularly around scheduling and communication – organizations can promote a more engaged workforce and a more successful business.
The problem with scheduling, and how employee self-service tools can help
In recent years, to help navigate the complexities of scheduling, organizations have resorted to various scheduling practices such as on-call scheduling, last minute scheduling and over-optimization. However, today these practices are proving not only ineffective and unsustainable, they’re also detrimental to both employees and employers.
On one hand, the heavily optimized scheduling systems that intended on reducing labor costs have contributed to issues like on-call and last-minute scheduling, problematic practices that have thrust regulatory scrutiny upon a string of major retailers. At the same time, traditional pen and paper and spreadsheet methods impede managers’ ability to generate schedules that balance individual employees’ preferences with business needs. When the shifts employees receive are incompatible with their personal and professional needs, absenteeism and turnover ensue.
Today, employers that replace manual shift management and on-call scheduling methods with self-scheduling technology can break the cycle of out-of-sync scheduling, boost hourly worker engagement and drive bottom-line results as well. Here are a few ways modernizing shift management positively impacts service industry organizations:
- Give managers more time to spend selling: Creating and maintaining schedules takes away from managers’ time to drive sales. Sixty-eight percent of service company managers feel that the hardest aspect of managing schedules is satisfying workers’ preferences and overarching business needs. When chained to clunky processes and manual tools, managers waste hours making mid-week adjustments and finding replacements for no-shows, leaving little time to perform critical manager tasks that impact the business. With technology that hourly employees can use to share their availability and conduct their own shift-swaps, front line workers get to take back control of their schedules and managers take back time. In turn, managers have more flexibility to stay on the sales floor supporting their staff and contributing to store revenues.
- Improved in-store service: Almost half (46%) of service businesses are sometimes or frequently understaffed, a problem that manifests as low store morale and poor customer experience – critical risks for any brand. When employees receive unpredictable or conflicting schedules, they’re less likely to show up when they’re needed most. Scheduling technology focused on employee engagement ensures that shifts are compatible with workers’ needs, keeps staffing levels stable, and protects customers (and sales) from the fallout of subpar service. Prior research shows that even an incremental increase in staffing levels can have a significant impact on store profitability.
- Reduced overtime expenses: Overtime pay has always represented a costly line item for employers, but it’s becoming even more burdensome now that the U.S. federal government has finalized the President’s proposed expansion, which caps the threshold at workers earning $47,476 per year and now covers many previously exempt managers. When scheduling is a time-consuming process, both managers and front line employees rack up overtime in order to compensate for no-show colleagues and last-minute shift openings. Adopting scheduling tools that focus on employee self-service, where they can do functions like easily picking up available shifts, lends a new degree of efficiency to shift management, helping employers mitigate extra payroll expenses.
- Minimized turnover: Turnover is a key problem for the service industry, which continues to suffer from a higher rate of voluntary employee quits than any other major sector. Having to replace even one hourly employee can take weeks of recruitment, onboarding and training to get a new associate fully up to speed and inevitably impacts the quality of the service being provided to customers.
Attrition is a natural result of disengaged employees who feel unable to manage and sustain their work-life balance. When hourly staff can resolve their own shift conflicts with more control over their schedules, they’re more likely to feel that their employers value their time; this, in turn, enhances staff loyalty. By holding onto employees longer, businesses avoid frequent hiring costs and develop a more experienced workforce, which can deliver stronger service and facilitate more sales.
One-off perks or occasional staff appreciation days are not long-term solutions to the hourly worker engagement problem. By revamping critical processes like employee communication, scheduling, training and recognition, employers can clear a better path for their people and their businesses.