Meeting spikes in demand with your existing workforce
When organisations experience an upturn in business, there is a tendency to deploy temporary labour in the form of overtime or agency workers.
Before pursuing this short-term strategy it is important to understand whether the increase in demand is likely to continue or whether introducing flexible working/demand-led rostering would be more cost effective.
Before taking on new staff, organisations must consider the cost of initial recruitment (placing of adverts, interview time and fees to recruitment agencies) and also the cost of start-up and ongoing training.
If the requirement for a product or service is likely to decrease due to a seasonal, cyclical or fluctuating demand profile, organisations could face issues of underutilisation in the long term.
Furthermore, following an increase in requirement for products or services, many organisations utilise overtime to meet an increase in demand.
Such usage could be questioned as a long-term workforce management tool since overtime cultures can drive inefficiencies, low productivity, poor performance and high sickness levels.
The importance of demand analysis:
When the requirement for a product or service increases, organisations need to begin by carefully analysing their demand for labour across each day, week and year, finding out how factors like product promotions, special events and seasonal changes have an impact.
It is important to examine whether current roster systems result in periods of non-productive time, during which staff are under-employed, and busy periods with heavy reliance on overtime, contractors or agency workers.
This data enables project teams to design new more responsive shift patterns that close the gap between supply and demand.
These will lead to a more planned labour environment that eliminates overstaffing and increases productivity levels.
Demand-led rostering systems state the contractual hours to be worked over a year instead of each week and enable the organisation to increase or reduce, planned hours in advance, to match the required labour profile, meet the peaks and ensure service levels are consistent through the day and year.
Consequently, concepts like Lean Employee Resourcing (Lean-ER®) provide employers with labour resources at a predictable cost that are flexible and responsive to the needs of the organisation without resorting to peripheral labour.
In summary, through increasing workforce productivity before growing the workforce at a lower rate, organisations can make substantial financial savings and efficiency gains.