Overview:
Getting caught short-staffed is a situation all too familiar to managers of teams almost universally. The added stress and the fatigue understaffing inflicts on staff is something we all try to avoid, with managers often citing unforeseen circumstances like staff absences, unexpectedly large sale volumes or changes in process that leave us caught short.
The truth is however not all staff shortages are unavoidable, some can in fact be predicted ahead of time. The decisions we make on a daily basis can make staff shortages more likely, or even a certainty weeks or months down the line. The problem is we’re not always aware of it.
In this article, we’ll help you understand the root causes of understaffing and how to effectively manage it through better forecasting of future demand and workload. Additionally, we’ll explore how to use the staff you already have more effectively to build a more agile planning process to help you roll with the punches as things change.
Forecast demand as far out as possible
The business environment is becoming more and more unpredictable, meaning that often the best-laid plans can be out of date soon after they’re shared with the team. Often small changes in the business environment can have impacts on staffing levels that aren’t immediately obvious and play out over weeks, months and years.
Your business needs to constantly adapt to changing conditions in order to ensure that forecasts are accurate over the long term. Factors like lockdowns, supply chain disruptions and other market forces all affect your labour demand, sales channels and customer behaviours, leading to periods of understaffing.
In order to more accurately predict long term staffing requirements, it’s critical we’re able to also predict long term labour demand. Here are some immediate actions you can take today to better forecast demand:
- Understand that no one forecast will be 100% correct. Create multiple forecasts that use “what-if” scenarios that take into account best case, middle case and worst-case scenarios and plan accordingly
- Build your forecasts in a modular way that allow you to change assumptions without having to rebuild your entire forecast. If elements like sales, task times or HR metrics are likely to change, ensure you’re able to make changes to them directly in your forecast
- Planning is an evolving process, write down your 3 biggest forecasting assumptions and revisit these regularly to ensure your assumptions hold over the long term and can be relied upon
Calculate staffing levels based on labour standards
By building a robust forecast of business demand over the short, medium and long term, you’re more able to plan for periods of variable or peak demand. However, understanding how many sales or orders you may experience throughout the year is only one side of the equation, you will also need to determine how many staff you’re going to have in the business to service this demand.
Labour Standards, ie the average time taken to perform a task are critical to understanding how sales demand creates workload and labour demand. For instance, if you make 50 sales in an hour and it takes on average 2 minutes for an employee to process each sale, that equates to 100 minutes of workload in that hour and 2 staff members required to process those sales.
Labour Standards can take time to accurately calculate, but they’re a powerful lever in your fight to prevent understaffing. Using these metrics, you can begin to understand how seasonal or variable sales demand relates to labour demand as well as the impact of productivity from new hires or retaining existing employees.
Of course in some regulated industries, understaffing isn’t just inconvenient, it’s illegal. Ultimately it’s down to you to decide how much room for error in your planning you’re willing to tolerate. If you need to ensure a minimum staffing level at all times, this may take precedence over calculating labour demand based on labour standards.
Increase staff flexibility to manage emergencies
Planning your recruitment throughout the year to ensure you hit your headcount target is critical, however, it’s equally important to properly utilise the staff you do have in your team today. As managers know too well, staff absences, unexpected demands and emergencies can ruin the best-laid plans. That’s why it’s critical to have staff available to respond when required.
Factors such as annual leave and training can be a double-edged sword for managers. If planned properly, staff can be encouraged to take time off the front lines during periods of lower demand, leaving them rested and available for busier periods. If planned poorly annual leave is taken during periods of peak demand directly leading to understaffing and causing fatigue in the remaining team.
Emergencies can disrupt the predictable and profitable model you’ve set up. Here are some tips to reduce the impact they have on your business.
- Invest in cross-training staff so they can help cover in multiple roles or across multiple locations
- Intelligently plan periods of absence such as mandatory training and holiday leave so that staff take time off during periods of lower demand
- Offer contractual benefits that encourage additional hours (increase motivation and service quality when employees were not originally scheduled to work)
Know your HR metrics to prevent headcount gaps
When planning the required headcount throughout the year, it’s critical to look under the hood at your HR metrics. The key is to understand not just how many staff are required, but how many need to be recruited, how many you expect to lose through attrition, recruitment lead times and the productivity of new recruits over their first few months. By having this data available to you, you can more accurately plan not just how many staff to hire, but when to hire them and how to support them in order to avoid unexpected gaps in capacity.
Document metrics like recruitment time, ramp time (time to full productivity), attrition and other metrics for the following groups of staff;
- In-house vs agency hire
- Location differences (are some units more difficult to hire for than others?)
- Seniority level
- Temporary vs Permanent
- Part-time vs Full-time
By using this data alongside your labour demand requirements, operations and HR can spot gaps in capacity and recruit in time to fill them. HR teams can also focus on improving onboarding and staff training to increase productivity and capacity.
Using Data Effectively
Ultimately, avoiding short staffing is as much an art as it is a science. Making the right demand predictions into the future, accurately calculating labour standards, knowing your HR metrics and increasing flexibility are all important, but without the right tools to measure, test and plan, it will be difficult to have the control you need to turn these insights into action.
This is where Quorbit’s Strategic Workforce Planning tools come into their own, allowing you to accurately forecast labour demand, plan what-if scenarios, intelligently allocate holiday and optimise the recruitment process using AI to ensure you have the right people in the business exactly when you need them.
Want to find out more about how to better plan headcount to avoid understaffing? Speak to us today.