From August 2007

By Faye Brookman

David Packi is a respected, full-time employee in the electronics department at a New Jersey Wal-Mart store. Occasionally, Packi is tapped to travel less than 15 minutes to another store, where he helps out during peak times.

At first blush, this seems an easy process -- sending quality employees to assist a sister store in times of need. But upon further examination, there are challenges involved, including which store actually “pays” Packi and accounts for him on the profit-and-loss statement. And a “tug of war” can arise when managers don’t want to share a prized employee.

Despite – or perhaps because of – such obstacles, the concept of market scheduling is gathering steam in retailing. “The practice has actually been around for some time, but people didn’t realize they were doing it,” says Andrew Zgutowicz, a principal and director of store operations at Kurt Salmon Associates.

“Today’s retailers require flexible workforces that are able to meet fluctuating workload demands. Employees want the advantages associated with full-time status, including stability, security, seniority and benefits. Market scheduling … provides significant benefits to both retailers and employees.”

Best for full-timers
Market scheduling works best for full-time employees whom a retailer might not need to deploy at one location for a full work week. “As retailers continue to focus on the quality and consistency of the in-store customer experience, the ability to make best use of the retail employee workforce is of critical importance,” says John Anderson, director of retail marketing for Chelmsford, Mass.-based Kronos.

“For all retailers, this means optimizing alignment of their workforce with the demands of their customers, and for some, this includes cross-store scheduling – typically to compensate for under-coverage due to a skill-based employee shortage or absenteeism.”

Historically, market scheduling has worked well in the case of employees such as Packi, who are skilled in electronics. It also works well for grand openings, employee training, visual merchandising, fixture and display assembly, product placement and event-driven product resets.

The strategy could be expanded to other tasks for which skilled labor is required, but for which the workload in a given store is insufficient to support a full-time position, Zgutowicz says.

Some retailers are better positioned than others to take advantage of this concept – those with multiple divisions within the same mall or lifestyle center, for example. The Gap could centralize backroom functions to accomplish a task for Banana Republic, Gap, Gap Kids and Gap Baby stores simultaneously.

“If you have a good stocker or good stocking team, why not use them at all four stores?” Zgutowicz asks. The result would be an increase in hours for some of the company’s most talented resources -- and a more consistent operating model.

Starbucks is sharing store manager responsibilities in multiple stores; convenience stores could also be positioned for this approach, Zgutowicz says.

Retailers that rely on the expertise of certain employees also are doing more sharing. Walgreens moves pharmacists between locations -- especially to new stores, where seasoned pharmacists help get a new prescription counter up and running.

Wal-Mart CEO H. Lee Scott referenced the importance of scheduling at the company’s 2007 shareholders meeting. Stores that have been testing new scheduling procedures to coordinate POS coverage with times of heavy customer traffic have reported comp-sales gains that are “twice as strong” as stores without the system.

One reason the industry is now poised to make better use of market scheduling is improvements in human resources software. “The biggest challenge to cross-store scheduling is the planning and coordination of employee resources,” Anderson says. For many retailers, this is a manual process whereby store managers must cooperatively schedule the shared employee.

“The challenge to this approach is that there is a lot of information that needs to be tracked, including the employee’s home-store schedule, their availability, an understanding of which store will be responsible for premium or overtime pay that may be incurred during the shared schedule week -- not to mention the employee’s actual hours worked for payroll,” he says.

Kronos for Retail enables retailers to automate and optimize store-level workforce management on a centralized, web-based platform. Employees can be shared across multiple departments and stores, enabling managers to gain secure access to any information required for effective cross-store scheduling.

Meeting customer demand
One supermarket chain is using the program to enable store managers to cost-out schedules based on employee pay rates. Employees use time clocks to swipe badges; hours are stored on Kronos software and exported to the payroll system for proper payment.

The advanced capabilities that automatically create schedules across multiple jobs and departments can also be used to generate schedules that leverage employee skills across multiple stores. The program automates complex manual processes to align the retail workforce with customer demand.