What is workforce management?
Workforce management comprises all the activities and processes needed to manage and maintain a productive workforce – from budgeting, scheduling, and forecasting to tracking employee time and complying with regulations.
The evolution of workforce management
In just a few years, workforce management (WFM) and the entire world of work has seen unprecedented change. Not only are attitudes and workplace culture undergoing enormous shifts, the way we do our jobs is evolving quickly as well. Fortunately, workforce management software has been evolving right along with this, to help you better navigate this rapidly shifting landscape. It includes tools to accurately forecast, track, and schedule working times and workloads so that the right employees and skillsets are available to meet demand. And by providing data-driven insights, it helps you better align your HR activities with your business goals – and quickly spot opportunities to streamline and boost productivity.
Workforce management definition
A definition of workforce management must consider the changing world of work. A recent joint study from MIT and Deloitte shows that remote and contingent workers make up approximately 30% of many companies, rising as high as 50% in tech and some other sectors. Shifting social and cultural trends are also having a huge impact on the definition of modern workforce management. At its core, WFM is a comprehensive and integrated set of processes and tools that help in planning, managing, and tracking employee work, including time and attendance, employee scheduling, and compliance with labor laws. But, today, WFM practices and solutions must also provide resources that help adapt to changing lifestyles, expectations, and the well-being and engagement of your workforce.
Key components of workforce management software
Workforce management software capabilities can range from the core functionality of time management, scheduling, and compliance to more advanced integration and predictive analytics.
- Time and attendance management: Top workforce management solutions should support time tracking from a multitude of sources, such as mobile apps and online time sheets. Self-service capabilities for requesting time off and granting approvals make life easier for both employees and managers, while alerts for overtime can help organizations avoid excessive payroll costs.
- Forecasting, scheduling, and budgeting: Solutions that use predictive modeling, AI analytics, in-memory data processing, and other advanced technologies can create the most accurate forecasts and scheduling. With these solutions, scheduling can be automated based on workloads as well as other factors, such as people’s skills, preferences, and availability.
- Analytics dashboards and metrics: Based on real-time workforce data, analytics dashboards and metrics provide insights into employee performance, scheduling effectiveness, and more. When WFM systems can integrate with other HR and operational data, the impact of workforce strategies across the organization can be measured and tweaked where needed.
- Worker wellness, health, and safety: Having a good management and communication structure is essential to maintaining employee wellness. Today’s WMF solutions can also help you leverage real-time workplace data and personalized reporting to ensure that you're on top of any risks or challenging situations your teams may be facing.
- Regulatory compliance: Configurable tools help companies track and comply with local and global laws, certification requirements, labor standards, union agreements, and more. With increasingly remote and geographically distributed teams, it’s essential to have a centralized view of regulations as they can vary greatly from region to region.
- Mobile workforce management: Secure, anywhere access to workforce management data and processes helps field teams, remote workers, and on-site employees and managers stay connected and work more efficiently.
- Integration: Integration with HR, procurement, and ERP systems can help you gain unprecedented insights. This means on-demand reporting and analysis, predictive planning for spikes and dips in hiring, and the ability to attach ROI to your cross-business workforce activities.
Top five benefits of workforce management solutions
By leveraging the power of real-time data, AI, and cloud-based workforce management solutions, you can gain a competitive edge. With strong communication and planning strategies, you can optimize these solutions by ensuring that your management protocols and values are evenly applied across your business. An engaged, happy, and motivated workforce is the core benefit from which all other WFM benefits can arise, including:
- Automated attendance tracking: Streamlines the process of monitoring employee hours, reducing errors and administrative workload.
- Lower costs: Optimizes staffing levels and schedules, minimizing overstaffing and reducing labor costs.
- Improved workforce productivity: Aligns employee skills and schedules with business needs, enhancing workforce efficiency.
- Compliance assurance: Helps ensure adherence to labor laws and regulations, reducing the risk of non-compliance penalties.
- Enhanced employee satisfaction: Offers tools for self-service and flexible scheduling, improving employee engagement and retention.
What is external workforce management?
The pandemic accelerated many workplace trends including the rise of remote work and a steadily growing dependence upon contingent workforces and services procurement. In fact, a recent Economist Impact report shows that almost 30% of today’s business leaders turn to external workers and services because they find them to provide cost-savings, risk reduction, and more flexible workforce planning. In today’s world of work, keeping a strong focus on external workforce management is crucial for ensuring agility and resilience in a fast-paced market. The use of modern vendor management systems and integrated workforce management solutions helps you to efficiently manage the entire lifecycle of external talent, and ensure seamless, compliant engagements that align with your company’s goals. This integration boosts flexibility and innovation, allowing rapid incorporation of new skills and ideas while ensuring legal compliance.
What is total workforce management?
Total workforce management is an integrated approach to achieving more seamless management of both permanent and contingent staff, including freelancers, contractors, and gig workers. It emphasizes the importance of human capital management (HCM) integration with vendor management systems (VMS) to ensure centralized visibility. To meet business needs and support a shifting future, the collaboration between HR and procurement is essential for effective management of the entire workforce. It helps to ensure that, regardless of the type of worker or nature of their employment - that your company is able to deliver consistent experiences and have confidence that you are fully compliant and fair in all your hiring and team management practices.
Choosing WFM software and systems
Workforce management software can come as a standalone program or as part of a broader HR system, such as a human resource information system (HRIS) with data management capabilities. Or it can fit into a complete human resource management system (HRMS) that unifies all human resource processes and data, from core HR and payroll to talent management. The functions of workforce management solutions are further enhanced when they can be integrated into ERP and procurement systems.
The ideal WFM software should also leverage cloud technology for enhanced accessibility and scalability. Advanced analytics and AI capabilities are crucial for predictive insights and intelligent workforce planning. Easy integration with a vendor management system (VMS) is also essential for effective total talent management, ensuring seamless total workforce management.
Empower your HR professionals, analysts, and business partners to answer questions quickly and accurately about your workforce.
The future of workforce management
Businesses today face changing cultures, uncertain economic and political forecasts, and rapidly fluctuating customer demands. To thrive in the working world of tomorrow, businesses will need to lean ever more heavily upon their HR teams – to not only guide them through a complex socio-political landscape, but to find efficient and profitable solutions for modern workforce challenges.
And HR tech is certainly providing many of the answers that modern HR professionals need to meet those challenges. In fact, McKinsey theorizes that artificial intelligence and automation will have as significant an effect on HR and the world of work as mechanization once did on agriculture and manufacturing.
Today’s organizations are also facing growing competition in a rapidly digitalizing world. To thrive, businesses must be ready to pivot quickly – whether that means changing an existing business model or adopting new and specialized technologies. And of course, that creates the need to nurture and develop this talent quickly – whether by sourcing and attracting new employees, or by recognizing and developing talent from within the organization.
And as the desire for remote work continues, organizations that are open to hiring people from other locations, and that have the right technology and HR processes in place to support them, can also offset the current talent crunch. However, creating a meaningful and satisfying workplace for employees that can’t work remotely is just as important.
Fortunately, integrated and intelligent workforce management systems offer the flexibility and insights needed to support the future of work as it evolves, even in times of unprecedented change.