Eight Questions to Ask Yourself about Your Labor Model

by | Oct 10, 2011

It has always been my belief that questions will spur more questions. That’s a good thing because the more we ask the more we learn, and the more we learn, the better we can perform at whatever task we may work on. As they say “Knowledge is power.”

We are slowly coming out of one of the worst economic downturns in history. While a few companies took subtle action to steer their business through the financial crisis, many companies were forced to take drastic steps to survive the crisis. Virtually all of these companies reduced their workforce and then reduced the hours that they had the remaining staff work.  Contrary to the “doing more with less” mantra that we heard during these mass layoffs, these companies just did less with less during the recession.

Today, companies are still picking up the pieces, and there are lots of pieces to pick-up.  For many, their business has changed, their customers’ expectations have changed, and the work that needs to be done to deliver their products or services has changed.  Fundamental to these changes is the labor model.

By “labor model”, I am talking about the plans and procedures in place to forecast labor need and improve labor performance as a cost compared to revenue. These include policies and procedures deployed to accomplish work and the communication of execution needs to satisfy the ultimate customer.

So, back to the power of questions. I like to start each day with a cup of coffee and a list of simple questions that will help me organize my day and accomplish my goals: What meetings are scheduled for today? What are my deadlines that I may have?  Who should I interact with today?

Similarly, for companies starting their new economic day, I believe it is important that their executives stop for a minute and ask themselves some pertinent questions about their labor model.  In most businesses, labor is the largest controllable expense.  It deserves some consideration in order for your company to be successful.

Following are eight questions to ask yourself about your Labor Model. Some are easily answered as yes or no; some are a little harder and take some thought. Regardless, grab yourself a cup of coffee or tea, and spend a little time to think these through:

1. What Do Our Employees Do?

OK, I know this seems pretty basic, but think about it for a minute  Can you really answer this question? When was the last time someone in your company actually inventoried of all the tasks and all of the services your employees do?

Who is in charge of keeping that inventory up to date?  How is that inventory included in your overall labor forecast?  Have you stopped doing certain things you did in the past or added new things to be done?  Have you introduced new technology to improve the productivity of your workforce?  What is the effect on needed labor because of those changes? 


2. How Long Should It Take Our Employees To Do What They Do?

If you have that inventory of tasks and services in place do you have a clear understanding of how much time it takes to accomplish each activity?  Many companies have piled work on their employees with new initiatives and new ideas but never taken the time to fully understand how much time it takes to do them.

If the existing labor model is not updated each time new pressures are put on employees, something has to give. Does the customer get ignored to accomplish a task? Does the task get ignored to service the customer?

3. How Well Have We Communicated Change In Processes to Our Employees?

When you initiate a new process or introduce new technology to your company do you make the employees fully aware of what is now expected of them? Do you tell them what the process or technology is replacing that they no longer have to deal with?

I have seen time and again situations where a new process or technology adds confusion to the workplace and does not accomplish the desired outcome on the bottom line. It is very important to analyze the labor model closely for improvements, but it is equally important to lay out the specifics for your employees showing the addition and subtraction of time needed to enact a new process.

4. Do You Listen When Your Employees Tell You How To Do Things Well?

Let’s face it. If you are reading this, it is probably because you are some type of manager or executive responsible for labor in your organization. Chances are that you are physically removed from the location where most work is performed.

The most impactful and successful process improvement ideas ever enacted in any organization have come from line employees. They live the work they do. They want to do it better, faster, easier, and they only want to do it once. Who better to turn to than your employees to seek ideas for labor model improvement? Empower them and incent them to help your organization be more efficient. Approach them with the concept that efficiency adds to job security due to corporate performance not to job loss due to cutting back.

5. Do You Listen To Your Customers To See If They Are Given Adequate Service?

We have all sat in meetings where we kick around customer satisfaction ideas. We have seen policies hatched and directives given that will surely hit a home run with our customers. I mean, who would not be happy to have consistent on-time delivery, or a genuine “hello, may I help you” when they walk in the door or call, or maybe even a sincere promise to ship only high-quality merchandise?

What about the rest of the customer service equation? Do you get that delivery on time, every time, but miss half the order because the process enacted does not allow the employee to have time to pick the entire order? Does that “happy hello” come at the expense of not having merchandise on the shelf because the employee does not have enough time built into their day to do both?

Look at your customer experience from end to end. Are you accomplishing the whole gamut of needed customer service? Ask your customer.

6. Do You Look For Better Ways To Do Things?

Developing a labor model is not a one-time exercise.  It is an on-going process. Continuous improvement is the best way to prepare your organization for a downturn like we have recently experienced.

Looking for efficiencies in processes and searching for ways to do things using less time are full-time endeavors. Doing things the “way we always have done them” is a sure ticket to failure in a recession. Many companies that did things better, faster and more cost effectively during the downturn picked up. So, it is wise to continually work your labor model.

7. When Was The Last Time You Freshened Your Labor Model?

People often laugh when I bring up the term “fresh” when discussing a labor model. I can understand that the word is well suited for products and food, but some question the use of the term in labor model analysis.

Well, “fresh” is really the opposite of “stale”. Who wants a stale piece of fruit, a stale approach to problems, or a stale attitude by employees? It stands to reason then that a labor model must be fresh to avoid being stale.

Take five minutes, close your eyes and really think of five things that have changed in your business in just the last year. Do you have a pretty good picture in your mind? Well, I would be surprised if at least four of those changes had some type of effect on your labor model.  A fresh labor model accounts for these changes; a stale one doesn’t.

8. Is Your Organization Capable Of Doing More With Less?

The first seven questions set up the answer to this last one. If you are pushed to the end of the plank again in a recession or downturn like we just had, are you going to be able to grow your business and redefine your business processes with an eye on more than just survival?

Haven’t you and your company worked way too long and way too hard to take a step backward? We all know it is much more rewarding to move forward and upward in business. However, if we have just sat around administering to our business and maintaining our old processes and methods, we have really become complacent and most probably incapable of even the least strenuous of our past performances.

You must be ready to do more with less at all times. If we are blessed with a huge upswing in the economy we may face employee shortages. As the world changes as it has politically and global entities put pressure on the world of business, we must be ready to do more and more to meet the demands of competition. As the consumer becomes more savvy and empowered through technology, we will be constantly challenged to do more with less.

Ask yourself: what do you do, how do you do it, how can it be done better, who can you include in the quest for improvement, and how do you effect change on your organization? Think about that and then go take a look at your labor model for the answers.

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