What is Workforce Management? (WFM)

Workforce management is a way that companies organize and manage their employees to work more efficiently and effectively. It's all about making sure that the right people are in the right place at the right time to get the job done. Workforce management processes help companies plan and schedule their employees, track their work hours, and ensure that they're meeting business goals.
19. February 2023  • 4 minute read
The idea of workforce management started in the 1980s as a way to improve the performance of call centers. Since then, it has grown and become widely used across many different types of businesses. WFM helps employers to forecast workloads, manage employee schedules, and gain insights into how their business is performing. By using this approach, businesses can improve productivity, reduce costs, and better manage their workforce to achieve their goals.

Why is workforce management important?

Workforce management is important because it allows businesses to optimize their workforce and improve their bottom line. By ensuring that employees are properly trained, motivated, and engaged, businesses can achieve better outcomes and reduce costs associated with labor.

The Definition of Workforce Management (WFM)

Workforce management is the process of organizing and optimizing a company's workforce to ensure maximum productivity, efficiency, and profitability.

What are the Key Components of Workforce Management?

The key components of WFM include:

  1. Scheduling and forecasting: This involves planning and scheduling employee work hours and forecasting labor needs to make sure that the business is staffed at all times.

  2. Time and attendance tracking: This involves tracking working hours and ensuring compliance with labor laws and regulations.

  3. Leave and absence management: This involves managing employee time off, including vacation days, sick leave, and personal time, while making sure staffing levels are maintained.

  4. Labor budgeting and forecasting: This involves estimating labor costs, creating a budget, and forecasting future labor needs to help manage costs and ensure ideal staffing levels.

  5. Performance management: This involves setting performance goals and expectations, providing feedback, and conducting regular performance evaluations to help employees improve their skills and achieve their full potential.

Each of these components is critical to effective workforce management, and they work together to help businesses optimize their workforce and ultimately achieve their goals.

Benefits of Effective WFM

  • Increased productivity
  • Reduced labor costs
  • Improved employee satisfaction and retention
  • Better compliance with labor laws and regulations
  • Improved customer satisfaction

What are the biggest Challenges of Workforce Management in 2023

While the specific challenges of workforce management can vary depending on the industry, company size, and other factors, some of the biggest challenges in 2023 include:

  1. Keeping up with changing labor laws and regulations: Labor laws and regulations are constantly changing, and it can be challenging for businesses to stay up to date and ensure compliance. This can be particularly challenging for companies that have employees working in many different countries.

  2. Balancing competing priorities: Companies must balance the competing demands of productivity, profitability, employee satisfaction and compliance, which is sometimes difficult to reconcile. Employee satisfaction is something that (rightly) requires more and more attention.

  3. Ensuring data accuracy and security: As more workforce management processes become digitized, businesses need to ensure that employee data is accurate and secure, protecting both the business and its employees.

  4. Adapting to a changing workforce: The nature of work is changing rapidly, with more people working remotely or on a freelance basis. Businesses need to adapt to these changes and find ways to manage a more flexible workforce, which involves digitizing.

  5. Addressing employee well-being: The COVID-19 pandemic has brought new challenges to workforce management, including the need to address employee well-being and mental health.

Overall, businesses that can effectively navigate these challenges and adapt to changing workforce dynamics will be better positioned to succeed in the years ahead.

The Best WFM Practices in 2023

To conclude the article, we have listed 3 best WFM practices for 2023:

1. Engage with employees to understand their needs 
Employees are standing up for themselves and their rights, more than ever. And companies can take advantage of this by showing that they actually care about them.Continually understanding employee needs and preferences can help companies create a more flexible, supportive, and simply better work environment. This can help improve employee satisfaction, retention, and productivity.

2. Review and adjust workforce management strategies regularly:
Workforce management is not a one-time task but an ongoing process. Times are changing, and currently faster than ever. Reviewing and adapting strategies regularly can help companies stay abreast of changing trends and adapt to new challenges.

3. Invest in technology and automation:
Workforce management software can streamline many tasks, from scheduling and timekeeping to performance management and payroll. Investing in these tools can help companies save time, reduce errors and improve accuracy.

Workfeed - Workforce Management optimized for the future workforce

With Workfeed, you can save up to 80% of the time you spend on employee scheduling, time keeping and payroll preparation.
Berry van Waarden
Berry van Waarden
Head of Marketing

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