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Workforce Optimization: Balancing Employee Supply and Customer Demand

When it comes to staffing, retailers have a difficult task – they must maximize employee utilization, minimize labor costs, and ensure acceptable customer wait times at checkout. Managing employee “supply” while meeting customer “demand” at the register is a daily challenge – but one that is too often overlooked. Long, slow lines erode customer satisfaction and leave shoppers with a bad impression of your store. 

To avoid these and other pitfalls, you need extensive knowledge of your local workforce – its available skills, qualifications, and specialties – plus an understanding of local demand, seasonality, and other operational factors. Basic sales forecasts and associated labor cost percentages are not enough; smart and effective staffing requires understanding both the true local workforce and at-the-register demand.

The Complexities of Staff and Store Planning

Creating staff and store plans is a complicated and tedious process. Staffing requires considering numerous variables – including employee skill levels, time of day, demand patterns, number of registers, and more – yet retailers often rely on simple spreadsheets that lack the sophistication and scientific rigor needed to leverage demand data, streamline the planning process, and improve plan accuracy.

Some retailers, for example, start with a sales forecast, apply a labor cost percentage, then trickle down staffing levels to the store level with little regard to location, seasonality, or event-specific variables. Others start with employee schedules and labor costs, with little regard for customer demand. Still other approaches fail to consider employee skill levels or register variations – self-service, express lines, and customer service counters. Spreadsheets just can’t effectively forecast employee supply and customer demand at the store level.

To build an effective, accurate, and profitable store plan, retailers must consider both local customer demand and employee supply at the store level. Utilizing advanced demand modeling and forecasting techniques (which can simulate checkouts with multiple combinations of channels and employees) removes much of the guesswork and significantly reduces the complexity and time required to create an efficient staffing plan. Now store managers can ensure staffing levels while freeing themselves to focus on what’s really important – serving customers.

A Solution for Workforce Optimization

SAP® Workforce Optimization for Retail is a comprehensive suite of solutions encompassing all aspects of workforce lifecycle management – employee performance, labor standards, staff and store planning, and more. Building on traditional workforce management tools, it helps retailers understand true demand at the register while providing key insights into workforce planning and performance. With this solution that compliments many current workforce management tools, retailers can:

  • Gain insight into employee labor standards
  • Monitor and maintain employee performance
  • Classify employees based on quantitative metrics using historical transaction data
  • Effectively manage wait times, queue lengths, service rates, queue perception, and server utilization
  • Increase customer satisfaction with respect to checkout while managing and even reducing labor costs

SAP Workforce Optimization is built with state-of-the-art demand-modeling algorithms and stochastic simulation and is delivered through the rich SAP BusinessObjectsTM analytics platform. A combination of advanced science and visualizations gives retailers greater workforce visibility, flexibility, and decision making power.

Making the right workforce decisions at the right time is essential to managing costs, lines, wait times at the register – and ultimately, customer satisfaction. To find out more about how advanced analytics can help you achieve your goals, go to

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