Power of Labor Scheduling

Introduction to Labor Scheduling: How High is Up?

With Black Friday only 43 days away, this blog is about the power that creating effective Labor Schedules will have on your sales results and is full of fascinating information that I hope will provoke how you think about the act of writing schedules.

One of the key tasks of being a Store Manager is writing schedules. There are managers who approach the task with fresh eyes each week depending on what is happening in their business and managers who write a schedule without giving it a second thought. Certainly during non-peak week’s with minimum coverage payroll hours, there isn’t much you can do besides the basic open/close schedule, right? Yes and No. The number of hours may not change but how you schedule those hours and who you assign to the shifts will impact your sales results. Right now we are gearing up for the first and sometimes largest peak, Black Friday, and writing a schedule is one of the MOST important activities you will do in preparing for your peak.

Before we dig into today’s content, I have five questions that I want you to think about.

1) Thanksgiving week is what % of your November sales plan? 

2) November is what % of your quarter or season? 

3) How + / – are you on the year to your $ales plan or last year sales results?

4) How many new customers will you see during this time and how important is the customer experience to keeping these customers coming back all year long?

5) How many gift cards will you sell bringing customers back in January to purchase?  Do you need that traffic in January? If the answer is yes, what is your strategy to sell cards?

My hope is that the answer to these questions will remind you how important the upcoming peak is to your overall business and when you read this interview, you will realize that effective scheduling can help you achieve the results you NEED and WANT!

What I believe drives how I behave and how I behave drives my results.

Q&A with Bob Hammond, VP, Matrix Retail

I had the benefit of spending a few hours with Bob Hammond, Vice President of Matrix Retail today to record a podcast and he shared compelling information about the connection between lost sales and effective labor schedules. You get to be a fly on the wall of our conversation! Enjoy the Q&A format below.

RW: Bob, I am so glad we finally got to spend some time together and talk about our favorite topic: Labor Scheduling. I have always been a bit of a scheduling nerd because I know the impact effective schedules have on driving sales results. As challenging as retail is right now, anything we can do to maximize sales results is high on my radar!

BH: I agree – I have always had a passion for Labor Scheduling and yes, writing effective schedules has a direct impact on the store’s actual results. I have some interesting data to share with you today.

About Matrix Retail

RW: Why don’t you first tell us about Matrix Retail?

BH: We specialize in creating store staffing schedules for specialty retailers. We are experts at activity based scheduling. The partnership with our clients has three imperatives:
(1) Invest payroll efficiently and effectively

(2) Provide operational support / tools to achieve all financial objectives

(3) Extend their individual brand strategy to every store. In other words, we link employees to corporate strategy.

What has changed in Labor Scheduling

RW: Bob, we have a lot of Store Managers listening to our podcast and reading this blog and they may be wondering why we are dedicating an entire episode to Labor Scheduling, a task they do every week, perhaps without thinking about it. Has anything changed in scheduling since you and I were writing schedules 20+ years ago?

BH: We weren’t just writing schedules, back in the day we were HAND writing schedules! So yes, a lot has changed. Computers are playing a bigger role, the scheduling process is faster and online; projecting much more accurate forecasts, advanced algorithms creating optimized schedules. But with everything that HAS changed, one thing has not changed over the years, the biggest opportunity continues to be employee availability.

It all hinges on one thing…proper availability

BH: With all the advanced scheduling optimization capabilities and all the tools that we provide to help managers, it still hinges on the managers hiring enough people that can work when they need them to work.

RW: Employee Availability is an opportunity that doesn’t discriminate by store type – whether you are running a high volume, low volume, big box, small box, mall, strip or lifestyle store…and continues to be what determines a store’s sales success.

BH: It is true. On a brighter note, another thing we see across all types of stores…once managers have employees that can work when they need them to, and once they schedule to the needs, the needs sometimes increase. What does that mean?

Here is a situation: Let’s say your peak week has been consistently under scheduled. Once the peak is scheduled properly, the peak actually gets higher. Then when that new high gets scheduled properly, then the peak gets higher still.

RW: Well if that isn’t compelling enough info to ensure every shift is covered, why don’t you share the case study you did regarding the impact of scheduling on actual sales results.

Effective labor scheduling = better sales results

BH: We did a detailed analysis of the impact of scheduling on sales for a retailer that had 1000 stores. We looked at every week in every store for an entire year. 10 million data points. For each hour, we evaluated two simple results: (1) did they schedule the right number of people for this hour and (2) did they make plan for this hour?

The result, no surprise. The managers who were the best at scheduling had the best sales result. And the opposite was also true – the most under scheduled had the most opportunity for sales. So no surprise there either. Recognizing that under scheduling which in turn results in lost sales is not exactly rocket science. There is tons of evidence that under scheduling leaves sales on the table.

Two Key Learnings on Labor Scheduling

However, two things stood out to us:

(1) The spread of the sales results between good schedulers and not so good schedulers

– The best managers, meaning we gave them an optimized schedule and they made sure they had the employees there when they were suppose to – achieved a +17% sales result.

– Pretty good managers were at +9%

– Good managers were at +2%

– Average managers were at -2%

– Below average were at -5%

That is a 23 point spread between the managers scheduling the best and the managers who had the most opportunity.


(2) The other result that stood out to us was that sometimes the difference between great and good was just an hour or two a week! So that means the difference between +17% and +9% was two hours in the peak of Saturday.

Another news flash…EVERY HOUR MATTERS

Why does availability continue to plague managers?

RW: With all this compelling data, why does availability continue to be a challenge for store managers?

BH: There is overwhelming evidence that not having employees that are available to work when you need them causes under scheduling which in turn results in missed sales. So why wouldn’t every manager make sure they had employees who were available to work when they needed them? That was the next question we wanted an answer for.

What we have seen is that when a store has employee availability issues it is usually due to a lack of planning by the manager. Either the manager didn’t plan ahead for upcoming staffing needs or didn’t plan appropriately or was just too late to make sure their team had availability they were going to need to be successful at peak.

Make your Bed

RW: I have recently re-read Admiral McRaven’s book called Make your Bed. The Admiral says “if you want to change the world, start off by making your bed. Making your bed every morning gives you a small sense of pride and it encourages you to complete more tasks throughout the day. It reminds us that the little things matter and if we cannot do the little things right, you will never be able to do the big things right.” This message resonated with me as we were preparing for this conversation…scheduling is like making your bed (while not really a little thing). It is something you do every week, without fail and you never get a break from it. And you can choose to do it right or not. And if not, then the big impact is on your sales results.

BH: Love that book and it’s a great point you make. One of the single biggest things a manager can do is to ensure they hit their sales goals for holiday or any peak by being staffed appropriately, with employees who have the availability to work when you need them. It would be time very well spent if a manager spends a little time every day preparing and making sure they are staffed for peak. It will be a little effort that pays huge dividends in sales results.

Solutions for Managers

RW: Let’s share some solutions that managers can use to ensure they maximize their holiday business.

BH: The solution is pretty simple.

(1) Have the right number of people on staff for any peaks in the business

(2) Make sure they can work when you need them to.

It is not enough to have enough people if they cannot work when you need them. That is the same as being understaffed.

RW: Remember when we were preparing for holiday hiring, we took the scheduled hours for the week, subtracted out managers hours and divide the remaining by 15 hours (assumed each associate would work that) and that gave us the number of people we thought we needed to have on staff? The assumption here was that the staff had complete open availability. If anyone reading this still does that, there is a better way.

Now managers need to take employee availability into account FIRST and hire for specific shifts that aren’t covered, not just a lump of hours.

Actions to Win at Holiday

RW: Let’s summarize what we talked about into action steps for managers for good labor scheduling.

BH: Good idea…three actions:

(1) Plan Ahead: Know your exact needs for every peak week & peak day

– Look at Results from last year (LY isn’t always relevant but it is directional);

– Look at past schedules

-Create a preliminary schedule for upcoming peak, list expected shifts (don’t go after false precision in this exercise)

– Start filling in the prelim schedule with existing employees

– Now you will know what shifts you need to hire to

(2) Get Commitment from the existing team

– Have one-on-one conversations with every employee. Don’t assume they will be able to work when you need them based on current availability; get their commitment.

– Prepare your employees in advance to have the discussion so they come to the conversation with the details you need.

– During the conversation be clear about what you need and ensure they are committed; have a calendar for the peak period so the right days get marked and a sample peak week schedule so they can see what shifts are needed.

(3) Hire to fill the gaps (+10-20% buffer for turnover)

Once you have had one on ones with current employees, then are will have a clear understanding of

– How many people you need to hire

– When specifically you need them to work

So, now hire to fill those needs! Make availability a very specific / deliberate part of the interview and even bring a calendar / schedule to the interview. It helps everyone clearly know the expectation.

Wrap it Up

RW: Such great information Bob, thank you for hanging out with me today. I am fired up and want to get this out to our retail friends so they can learn a thing or two like I have! I learned today that it is FACT…the managers who are staffed the best and have employees that can work when they need them to will also have the best schedules resulting in the best sales!

BH: When you don’t have enough employees that can work when you need them most, that will cause under scheduling and THAT will result in LOST SALES. Today was fun, thanks for inviting me to join you.

Listen to the Labor Scheduling podcast at your favorite podcast locations – Apple, Spotify, Anchor fm

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