Managing a shift based workforce can be a challenge, but with the right tools in place it doesn't have to be.
In this Q&A interview, Deputy's Senior Solutions Expert Steve Woods talks you through how to forecast demand in your business and ensure you have the right number of staff on each shift.
First off, what is demand planning?
- Demand planning is looking at supporting businesses to better allocate labour to changing levels of demand through their organisation. So making sure that you've got essentially the right number of employees working the right roles at the right time.
If you imagine a hospitality business, they've got traditional peaks and troughs throughout the course of the day: breakfast, lunch, dinner.
So demand planning is about ensuring you’ve got just the right level of labour to hand during those different periods of the day. And effective demand planning brings different forecast data to the platform such as sales data and foot traffic. Deputy has also looked at doing really advanced things like analysing local events and seasonality, time of year, whether it's school holidays, et cetera to forecast the total number of orders the hospitality business might have per hour per day into the future.
What are the major challenges in getting demand planning right?
- The first challenge is getting a level of accuracy around the forecasting process so it's providing a valid level of predictability into what's coming down the track for that particular organisation.
And then when we've got the forecast in place, I think the next challenge is looking at how we build relevant labour models. So let's say that I've got a forecast that says I've got 100 orders for breakfast, I've got 200 orders for lunch and for dinner, I've got 300 orders. So if that's the case, then how do I gradually ramp up my labour throughout the course of the day? How do I know how many employees I should have working for the number of orders that's coming through the organisation? How do I map the forecast that I've so meticulously created in part one to the actual labour requirements that I've got in the organisation itself? So at this stage we look at things like the number of employees you need working versus the number of, let's say orders coming into the organisation per hour per day.
And then we can set floors and ceilings around that as well. So you know, you might only have capacity to scale to a maximum of five kitchen staff.
What makes an optimal demand plan forecast?
- After we’ve gone through the process above there's lots of different work we can do to create different labour models for different parts of an organisation. When those labour models are run, they provide businesses with a forecast on their staffing levels.
So in this scenario we've gone from a forecast on the number of orders coming into an organisation to a plan for the number of employees that they need, working in different roles in different departments per hour, per day.
And the important thing to mention is that even when you have that, it's still not the end result. Because if I've got a forecast that says I should have five employees working at 9 am and eight employees working at 12 pm, then I can achieve that with a variety of different shift types, shift durations and shift start and end times.
But what's the optimal shift pattern that's going to help me allocate my employees in the most effective way?
- We work with clients to better understand different types of shift lengths required and when shifts should start. We combine this with forecasts on required labour levels to create an optimised shift pattern. The final stage is then automatically allocating the right employee to the right shift. To do this we look at their qualifications, availability, whether or not they're on leave and any other custom requirement that might influence the shifts you want your employees to work.
What’s the level of accuracy for shift pattern creation?
- The more precisely we can forecast, the more accurate everything becomes further downstream in the process. Which is why, when we work with clients we always start with forecasting. It’s key to generate accurate forecasts for core demand drivers (e.g. sales data) that take into account variables such as seasonality, weather or local events. Pattern creation accuracy, depends on the parameters that a customer puts in.
What role does the sector play in accurate forecasting?
- The forecast we use is very dependent on the sector. For a care home, we're forecasting occupancy levels and for a hospitality organisation we tend to forecast things like the number of orders coming in or foot traffic.
What are the most common misconceptions managers have about automated demand planning?
- So when we talk about demand planning in general, there can be a bit of confusion in the market.
One common misconception is assuming technologies such as AI and machine learning are there to take over the role of labour planning entirely. AI is incredibly good at prediction and the more inputs we provide, the more accurate those predictions can be. What it lacks however is a manager’s ability to rationalise, adjust and course correct to changing events on the ground. It can't reason like a human can.
What’s a more accurate way of seeing this use of technology?
- Here in Deputy we use the term assistive intelligence. So it's about businesses not handing over everything to an automated process because there are still things that managers on the ground are going to need to do. Instead it’s about this relationship between automating the more transactional parts of the process, but then relying on the institutional knowledge that managers have got to refine and tweak the recommendations that the platform's making. So together with our partners, Deputy is automating 70% of the manual tedious work, but we're still relying on the vast experience of managers to complete the process.
To summarise, what’s the best way managers can effectively manage their workforce through changing levels of demand?
- Having the right solutions in place that can marry up changing levels of demand to different labour requirements and availability is key. Labour is the highest cost for many businesses. Without real clear visibility on what's driving that cost it becomes very difficult to plan for changing levels of demand and increasingly expensive to both sustain and scale your operations.
If you're interested in efficiently reducing labour costs and ensuring optimal coverage across your rota, check out how Honest Burgers achieved this with Deputy.