EntryPoint Global - Time and Attendance - Labor Scheduling - Kronos - Workbrain - Infor

Modern scheduling solutions can offer tremendous competitive advantages to those firms that do it well. For many companies, such as Best Buy, investments made in upgrading their labor-scheduling practices and technologies within their stores are beginning to return both tangible and intangible benefits to their business. These include:

• Reduced labor costs
• Improved employee productivity
• Improved customer satisfaction 
• Improved employee satisfaction, and ultimately, once consumer spending returns in more normal economic times; 
• Increased sales

Like many forward-thinking and well-managed companies, Starbucks has recently made significant changes in the way they go about scheduling their employees. The company will be utilizing an automated enterprise scheduling solution centered-around a set of new corporate-wide policies to help streamline and better manage employee scheduling throughout its North American stores. Starbucks calls its new scheduling strategy “Optimal Scheduling” and the program was designed to reduce labor costs and increase the number of allocated work hours across a smaller pool of employees. However, the new policy is receiving quite a bit of negative press and push back from many of its ‘partners’ (Starbuck-speak for employees) and its new union lately. Why is that? Why has it worked well for the other companies, yet run into rough patches at the speciality coffee retailer?

This blog entry will provide a brief overview of Starbucks’ new Optimal Scheduling program and some of their missteps. I hope the lessons learned from Starbucks could prove invaluable to others considering or implementing modern Scheduling within their organization.

So, what does the program look like? Optimal Scheduling is based on the following scheduling parameters.

• Full-Time (FT) employees must be  available to work 70% of the hours during which their store is open and provide the system with these hours 3 weeks in advance of the scheduled work week

           -  For a typical Starbucks open 16 hours/day, this translates to 80.5 hours per week

           -  Yet, the new system does not guarantee a minimum number of hours in exchange for this increased employee flexibility

• Part-Time (PT) workers must be able to work 3 shifts or 16 hours per week

• According to the policy, partners will given 6 months to adapt to the new program and those unable to do so would be ‘separated’ from the company

For a company that has had a few labor issues recently, (a former blog entry discusses a recent lawsuit against Starbucks for the improper allocation of Barista tips ) you can see why the new policies could cause some friction with some of its baristas.

Suboptimal Scheduling: Where Starbucks' Optimal Scheduling Program Falls Short

According to Starbucks spokeswoman Tara Barrow, the new program is a “…a win-win for our customers and partners” and will allow for “more stable scheduling and more satisfied partners.”

While the new strategy will indeed meet many of the company’s business goals, as well as address a key employee complaint about securing enough work hours, Optimal Scheduling could have proven much more successful for the company, it could have avoided the negative press and ultimately, could have been better accepted by its partners had Starbucks;

• Realized the critical importance of Change Management issues  and placed much greater emphasis on employee involvement, communications and stakeholder management
• Designed a system that allowed for even greater employee Self-Service and greater employee flexibility in schedule preferences, while still aligning with its overall business goals
• Based on what we have seen at other retailers, Starbucks’ employee availability requirements  (i.e. 70 hours) are too high - no wonder there has been so much employee pushback.

EntryPoint’s experience has shown that companies often underestimate the importance of managing potential employee resistance early on and in communicating new initiatives in a clear way to all stakeholders involved. Without properly addressing all organizational challenges, companies can put their technology investments at risk, fail to achieve all the intended benefits...or then need to deal with unneeded headaches.

And perhaps most importantly, since labor scheduling plays with employees time [and money], companies need to balance both employee issues with their underlying business goals so that both sides see the benefits and needs of the new system. Getting this right, is often more art then science.

Where Optimal Scheduling Succeeds

Increasing Hours Allocated - The new program is designed to address the long-time complaint by many of its baristas, that it was too difficult to secure enough hours on the clock each week. The new policy will in fact allow any of its baristas want to work more hours to get those hours, and shift the composition of its workforce to more Full Timers, will reducing the numbers of PTers and eliminating those who can’t meet the minimum number of required hours to qualify as a PTer. The new policy will give partners and store managers 6 months to adapt to the new corporate policy and these new staffing requirements.  

How will labor costs be reduced?  By increasing the number of hours worked/per partner, the new program should reduce partner turnover and therefore  associated hiring and training costs (which becomes significant with over 100,000 employees) and minimize any unnecessary  OT by managing partner time. It should significantly reduce the number of hours store mangers currently have to allocate to staff scheduling, thereby indirectly reducing schedule generation costs and allow the manager to spend more of their precious time to customer facing, revenue-generating activities rather then operational ones.

Ultimately, it will provide both individual store managers with a better control of their local labor costs, and for corporate HQ back in Seattle, the end result of their more complete Workforce Management system, greater visibility of overall labor costs across both its non-franchised and franchised operations,

Improving Customer Satisfaction - With the company’s rapid expansion, the levels of customer service the attention to detail that typified Starbucks in its smaller days, has undoubtedly given way to a more standardized, more efficient, more uniform customer experience.  While there are many innovative initiatives the company is surely experimenting with, a large part of it will amount to a return to basics – a return to the art of coffee making and the relationship between customer and the barista. By matching customer demand (or foot traffic) with qualified, available staff Starbucks will be able to ensure consistent, non-rushed  customer service.  There are intangible benefits that should arise as well.  For example, by allowing for more uniform schedules, seeing the same face on a more regular basis will help in creating that more personal relationship between customer and the given Starbucks location. In the end, it is these small intangible little things that can make a big difference…

Consulting companies specializing in Labor Scheduling solutions can help organizations achieve full value from their Scheduling endeavours. It's very powerful stuff, but not easy to get right.

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