A positive view on workforce in times of scarcity

In Western Europe, retirement is making the workforce shortage more dire. The gap cannot be filled quickly. IT staff shortages seem to be the greatest amongst sectors. But other domains, like public transport, are equally affected and face more serious consequences. About 10% of all companies see their growth hampered by a lack of staff. In fact, it’s not only growth but the ability to maintain services that’s at risk.

How should companies respond? During ORTEC’s recent Data-Driven Workforce Summit, we asked the audience: how should we deal with staff shortages? Only 5% responded that better primary working conditions were needed. The rest emphasized things like being a good employer and better workforce deployment – both being at least as important as salary.

Workforce scarcity data is revealing

Staff scarcity has many dimensions. For example, a while back we analyzed data from the healthcare sector. It turned out that half the time there was more staff than work; overcapacity. The other half of the time healthcare institutions suffered from undercapacity. We noticed that the perception of the situation differed considerably. Overcapacity tends to go unnoticed. While undercapacity almost always translates into stress. The lack of staff far outweighs having extra staff.

The answer lies in smart staff distribution

There is much to gain with the smarter and better deployment of employees. Not only financially but also in terms of job satisfaction, which is crucial to retain employees in times of scarcity.

Consider a practical example. A logistics service provider had several distribution centers (DCs) located at one site. Each DC worked for individual customers. When one of these DCs faced a workforce shortage, they hired staff through an employment agency. Surprisingly, the need for personnel in each DC was quite complementary. In winter, DC 1 had a staff shortage and hired staff. In spring this applied to DC 2, and so on. It soon became apparent that they had to look beyond the DCs to analyze supply and demand. They calculated that a certain minimum of personnel was needed for each DC. This helped them meet the varying demand per DC with a relatively small flexible layer of permanent employees. Thereby, they avoided hiring temp workers.

This gave them several advantages: efficient employee deployment resulted in greater customer satisfaction and better quality, because people from an employment agency always had to be trained. In addition, employees who liked variety thrived in the flexible shell, while other employees were happier with a stable workload at their fixed workplace.

Data-driven workforce

At ORTEC, we developed a decision-making framework called Data Driven Workforce: making optimal personnel plans based on data. We developed ORTEC Workforce Scheduling to help companies make optimal planning choices when it comes to personnel. In addition to personnel planning, we help our customers forecast the amount of work. This is handy to estimate the volumes that the workforce will have to be able to handle.

A substantial factor of the efficiency gains on staff deployment comes from forecasting demand. The rest comes from the algorithms that optimize the rosters.

And that's just the tip of the optimization possibilities. When making algorithms, we talk about constraints: conditions that we have to meet in order to get a solution right. For example, the number of vacation days and part-time schedules. Constraints can also include complex matters like activities that need to be performed in a certain sequence or time of day. When some constraints can be made less time-critical, then this contributes to spread the work, which reduces peak moments, and thus facilitates the deployment of personnel. Predict and prepare!

Employees vote with their feet

The value of individual planners cannot be understated: after all, a planner tends to know a lot about the circumstances of other employees, their situation at home and their preferences. Often, companies ask us to compare schedules created by planners with schedules that are automatically calculated. They tend to find that schedules that are augmented by data and algorithms have positive side-effects. Suddenly, planners can also look more closely at the preferences of remote employees or those who are less likely to express their requirements.

Optimized roster planning can also promote equality, an important condition for employee satisfaction. To facilitate this further, we also offer modules for employees to self-schedule, exchange shifts or submit their particular preferences.

Look beyond efficiency and embrace effectiveness

The focus in workforce planning often revolves around efficiency. But effectiveness is just as important. If you deploy your employees well and treat them well, you can reduce absenteeism due to illness, for example. In turn, this immediately relieves the workload as well.

A practical example: we measured the result of a schedule optimizer in a large academic hospital before and after implementation. Absenteeism due to illness was reduced by more than 2 percentage points. That is 20 fewer vacancies per 1,000 employees. It removed the need to hire 20 more people; 20 times less hassle. We also found that optimized schedules reduced stress levels among healthcare workers. The same study showed that the assessment of the work-life balance had improved from a 4 to a 6.7 on a scale of 10.

This example shows that it pays off to invest in employees. Consider another case in point at a huge seaport operator. The average waiting time between requesting a day off and receiving approval was more than 100 days. Employees had to think about whether they wanted to go on holiday 3.5 months in advance. Digitizing and optimizing the process enabled the operator to approve leave within a day, since employees could find someone to cover them through an app.

Your employee is your ambassador

Speaking of apps and employee satisfaction, good and transparent internal communication helps to get your employees engaged. A good communications app is key nowadays to support this. This app should course also facilitate options around the schedule: enabling employees to fill in their wishes, exchange rosters, apply self-rostering and have visibility into the plan.

When employees are engaged and involved, they become your ambassadors. Our Dutch customer DELA, a (funeral) insurance and real estate company, successfully launched the “DELA Voor Elkaar App” to empower their 1,700 employees with these capabilities. A positive side-effect was that they have been able to attract new talent.

Think outside the box to combat scarcity

To recap, scarcity is a given, but there are still plenty of options to deal with it. Improved scheduling is one of them. The focus should certainly not only be on scheduling efficiency, but also on making the work more enjoyable and manageable. By making the technical algorithms more emphatic and involving your employees in the process, you can get efficient schedules to meet demand while driving retention.