05/14/2013 05:23 EDT | Updated 07/14/2013 05:12 EDT

How Canadian Companies Can Manage Labour Costs

For Canadian employers, the overall business environment raises many questions. What can we do to drive growth? How can we improve productivity while still controlling costs? How can we produce high-quality goods and services to remain competitive both at home and globally?

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Today, the Canadian economy faces uncertainty, as many analysts only predict slow growth in 2013, with hopefully more significant gains to be realized in 2014.

Most Canadian industry sectors are feeling the pain -- due both to such macroeconomics and new or changing business variables, among them rising costs, new regulations, heightened competition, employee shortages, and more.

Consider some recent developments:

  • Manufacturing: In the last quarter of 2012, Canadian manufacturing's operating rate (i.e., the industry's collective "capacity") was 80.2 per cent. While a number over 80 per cent is generally positive, this latest figure actually represents a decline of 2.1 percentage points from the previous quarter, and thus, disappointing news.
  • Healthcare: Today, the Canadian healthcare system is under intense pressure to improve the overall quality of care for all patients. Yet in an environment of increased demand due to an aging population, budget restrictions and employee shortages, this goal is proving increasingly difficult to achieve.
  • Retail: The Canadian retail market has also changed considerably in recent years. For example, as many U.S.-based retailers establish a stronger foothold north of the border, they have also introduced many new competitive approaches, such as "Big Box" retail, everyday low prices and online shopping, all of which make the retail market in Canada today more competitive than ever.

For Canadian employers, the overall business environment raises many questions. What can we do to drive growth? How can we improve productivity while still controlling costs? How can we produce high-quality goods and services to remain competitive both at home and globally?


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Back to the Future: Refocus on Labour Costs

There is no one-size-fits-all answer no matter what industry you're in. Yet in times like these, taking a step back and refocusing on basic business fundamentals is often the best course of action. For example, most organizations could clearly benefit by taking a closer look at their current labour costs, evaluating how they can minimize those, and better optimize their workforce to generate improved business results.

Why labour? Labour costs are often the most misunderstood expense item on the corporate balance sheet, if not something that is ignored altogether. Yet for just about any organization, labour is the single largest controllable cost, and if optimized, a company's workforce can lead to extremely positive results. For many Canadian organizations, labour can be the most strategic factor to help them achieve their growth goals today.

Workforce Management Technology

Fortunately, monitoring labour costs and managing the entire workforce isn't as difficult as it may seem. Gone are the days of paper timesheets, manual payroll calculations and reports that arrive too late to influence results. Today, powerful workforce management technology is giving smart organizations real-time insights into key workforce metrics such as current staffing levels, current costs, potential demand and much more. As a result, organizations that employ the latest tools can truly "manage in the moment" and deliver optimum results.

Based on the idea that users shouldn't have to choose between deep functionality and ease of use, workforce management technology is currently centred around three unique capabilities: Instant engagement, guided decisions and mobile management.

Let me explain each of these.

Instant Engagement

When it comes to personal technology, employees today expect software and devices that are exciting and intuitive. The right workforce management solutions offer a compelling, intuitive user interface, innovative and flexible data capture devices and a focus on mobile technology. When designed around the way people work, these solutions can instantly engage managers and employees alike by providing them with the tools they need to effectively do their jobs.

For example, a next-generation time clock built for the modern workforce can redefine the way Canadian organizations track and collect employee hours. By having the feel of a tablet device or a smartphone, this new generation of time clocks can allow employees to enter hours, easily check accrual balances, request time off and view schedules -- all in real-time. A graphical user interface enhances quicker end-user adoption; users can simply pick an icon and the system prompts them through appropriate steps, providing unparalleled levels of intuitiveness.

Guided Decisions

The decisions an organization's frontline managers make every day now make the difference between success and failure. By providing users with all the labour information they need to guide them in making better decisions, effective workforce management solutions improve productivity and control labour costs. Workforce analytics deliver real-time information that can transform labour and sales data into meaningful business intelligence. This information can be especially powerful when managers have access to a single view of labour, sales and traffic data.

Mobile Management

In an increasingly mobile world, managers and employees need to access and rapidly respond to workforce management issues from anywhere, at any time. With mobile access through the most popular smartphones and tablets, users can see relevant labour information -- when and where it's needed.

Designed around how people naturally communicate in the digital age, new mobile workforce management applications help employees enter time, check schedules, select shifts and request time off from managers -- all in real-time. For supervisors, common functions, including timecard approvals, the ability to view maps to see where and when mobile employees conduct time punches and exception management are even further simplified with mobile workforce management applications.

While it will take more time, and perhaps just the right combination of market conditions to push the Canadian economy higher, companies can be proactive in driving growth, improving productivity and controlling costs. By focusing on business fundamentals such as labour costs and optimizing their workforce -- both entirely possible with the latest workforce management technology -- they can begin to achieve these goals today.