Labor Management: The Remedy for Tight Margins in an Economic Downturn

DATArrive Labor Management SystemWith many companies looking to tighten the fiscal belt and find ways to maintain profitability in a sluggish economy, Labor Management Systems (LMS) just may be the perfect remedy. Granted, of all the products in the mobility storefront, LMS is not the eye-catching, drool inducing, UI wizardry that most of us covet. It is built upon the less desirable and often eye-glazing terms of prevailing wage, asset usage, time on site, budget to actual and many other good ol’ finance nuts and bolts. That being said, implementing a process that can identify waste, jumpstart productivity and keep you under budget is worth taking a second look.

In this month’s issue of Logistics Management, Maida Napolitano takes a look at how LMS is the often under-utilized tool that can have the most positive impact upon a business. Within the article, Maida sites several ways the savvy workforce manager can use a Labor Management System to their benefit:

  1. Achieve real-time visibility – Old school LMS systems relied upon batch mode with supervisors reviewing performance reports at the end of the day or even week. Today, LMS produce up to the minute records, with alerts and critical dashboards to warn against overages or defined exceptions.
  2. Identify unproductive time – Don’t just think about wasted time in terms of catching up on last night’s game or extended breaks. You might be surprised to know the time waste is coming from within your own companies processes. An employee may be employed for eight hours, but LMS can reveal that only 6 hours of work were done. The other two were spent waiting for tickets, safety checks, or waiting for product to be replenished. Upping productive tasks even 1/2 hour a day has an exponential pay out across a company.
  3. Implement an incentive program – LMS need not only be a watchdog against those below the curve, it can also become a vehicle for rewarding those ahead of the curve. For example, if a task is budgeted for 2 hours but a worker completes it within one hour, why not reward the worker with a portion of the saved money? With incentives, productivity increases.
  4. Improve workforce planning – With seasonality, demand volumes can fluctuate and therefore translate into the pain of over staffing or under staffing. By leveraging a LMS, companies can now utilize historical data to staff for future seasons ensure demand is met and profits are not eroded by over staffing.
  5.  Develop more accurate costs – By analyzing job costing, managers can now have a better feel for how much they should be charging to break even or realize a specific profit margin.

Be sure and read the entire article here.

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