What is workforce management (WFM)?

It seems like yesterday when workforce management (WFM) was a straightforward, administrative exercise that hummed along in the background. But in the past few years, some seismic shifts have taken place in the world, jolting WFM into a far more strategic and integral position in modern companies. Of course, the pandemic ushered in a lot of sudden change, turning entire businesses into work-from-home operations almost overnight. We’ve also seen cultural and social trends that have led to some major rethinking in staffing and management. And while the rapid advancement of AI and software technologies has brought enormous benefits and efficiencies, it’s also having an ongoing impact on traditional workflows and employee expectations. But the good news is that today’s WFM solutions have kept up with the changes. They are better than ever at forecasting, scheduling, and leveraging all kinds of data to give businesses and HR teams the insights, power, and agility they need to navigate the evolving world of work.

Workforce management is a set of processes and tools used by organizations to optimize employee scheduling, forecast labor needs, manage compliance, and maximize workforce productivity and efficiency.

From manually recording employee hours on spreadsheets and punch cards to the complex software-driven practice of today, workforce management tasks have undergone significant change. As businesses grew more complex and regulations and compliance became more sophisticated, organizations needed smarter ways to handle staffing and scheduling.

Today’s cloud-based WFM solutions have made things easier and more accurate. Managers can count on real-time analytics and forecasting to handle staffing surprises, and employees can easily manage shifts or request time off directly from their smartphones. Automated compliance features help catch issues before they become problems, keeping everything running smoothly. In short, modern workforce management tools do much more than just save time – they improve collaboration between employers and teams in an ever-changing workplace.

Contingent workers are defined as temporary, freelance, or contract employees. The rise in this type of external workforce model has reshaped the traditional HR landscape. More than ever, businesses depend upon flexible staffing options to close skills gaps, handle shifting demand, and scale as needed. But this flexibility can bring with it some challenges, including diminished workforce visibility and difficulty in maintaining consistent standards.

In addition to more contingent workers, today’s companies also must typically manage a much larger remote workforce than existed before the pandemic. Each remote workspace or personal computer must meet stringent safety, security, and regulatory requirements. It takes robust and powerful workforce management solutions to help navigate this complexity and ensure proper oversight, compliance, and a consistent employee experience – no matter where that work is happening.

As your business grows, managing your team effectively becomes increasingly critical to your success. Here are a few of the many benefits of good WFM:

1. Increased productivity

   When staffing levels match actual workload demands, employees spend less time waiting around and more time doing meaningful tasks. Effective workforce management helps eliminate idle hours and burnout, ensuring your teams stay energized, focused, and productive.

2. Lower labor costs

   Good workforce management helps you accurately forecast future staffing needs. This prevents over-hiring during slow periods or being understaffed during busy ones. With smarter scheduling based on real data, you keep payroll expenses predictable and aligned with actual demand.

3. Improved employee satisfaction and retention

   Employees today expect fairness, flexibility, and transparency from their employers. Modern workforce management systems provide exactly that, giving employees control over their schedules, making it easy to request time off or swap shifts. This helps build trust, boost morale, and significantly reduce turnover rates.

4. Stronger compliance and reduced risk

   Labor regulations are in a constant state of change. With automated compliance monitoring, advanced workforce management solutions automatically track complex rules such as overtime limits, mandated breaks, and certification expirations. This reduces the risk of penalties and litigation.

5. Better customer experiences

   When the right people are where they should be, your customers benefit and your operations improve. Whether you’re running a hospital, a retail store, or a manufacturing line, workforce management makes sure your team is ready and able to provide the best and most informed service possible.