4 Questions HR Leaders Need to Ask About Holiday Workers Now
If you work in HR for a holiday hustle industry, managing staffing shortfalls and linking talent to customer satisfaction are likely at the top of your priority list right now. As the shopping season reaches its peak, here are four analytical questions HR leaders need to ask of their workforce data.
With an unemployment rate at a 17-year low of 4.1%, retail and delivery companies have executed a variety of tactics to land workers in a tight labor market, whether it’s through candy and movie-ticket giveaways or voluntarily increasing the minimum wage to $11 an hour.
At the same time, increased competition for the hearts of digital-savvy consumers has led to an increased focus on the relationship between staff and customer satisfaction.
But be warned: simply copying the moves of market leaders will likely create a legacy of fixed costs that become hard to unwind when the holiday rush ends.
Instead of copying others, you need to identify where you will gain the most advantage from adding to the costs of your workforce — whether it’s by investing in employee perks or weekly retention bonuses. As the shopping season reaches its peak, here are four analytical questions HR leaders need to ask of their workforce data:
Question #1: Is a staffing shortfall impacting our fulfillment timelines?
It is not enough to know that you are short staffed: you need to understand whether this is having an impact on your business. By asking a question that links your staffing requirements to a key business outcome, such as fulfillment timelines, you can focus your recruitment efforts on the most critical area.
To answer this question, look at order processing times, the volume of new orders, as well as the volume of orders that have shipped. An increase in order processing times means that the team is not keeping up with demand. This can be caused by an overload of tasks or too many hours of overtime. Tracking overtime will provide an early warning that fulfillment is at risk.
When more orders are received in a day than are shipped in a day, this is a clear indication that fulfillment is falling behind and more people are required.
Question #2: Do customer support teams with more experienced people achieve higher customer satisfaction scores?
Meeting and exceeding customer expectations is a good way to differentiate your brand in a competitive market. There is a definitive link between employee satisfaction and customer satisfaction: a dissatisfied worker will find it hard to generate the energy that’s needed to delight customers.
Keeping employees happy goes beyond chocolate bars and ping pong tables. The key to maintaining teams with a positive focus is having the right mix of experience levels within your groups. A lack of experienced staff members will only frustrate new workers looking for solutions to customer challenges and over-tax the in-demand experienced workers.
So what is the right worker experience mix? This will vary depending on your brand’s unique focus and skills requirements. Drill deep into your customer satisfaction scores and worker data to define the optimal ratio. This can also help ward off the negative brand impacts that come from dissatisfied customers.
Question #3: Do distribution centers with a higher proportion of contingent staff perform better or worse?
With a shift towards e-commerce, hiring managers are now focused on filling positions in warehouses and shipping facilities. This is a new frontier for HR in established retail organizations. Without much historic data to draw from, it can be difficult to determine what is the right proportion of contingent and permanent labor for distribution centers.
The key is to maximize the number of contingent workers while maintaining efficiency. To do this, you need to look at the work volume, the number of people required to deliver this work, and the relevant supervisory structure that makes this group effective. You also need to consider how you scale the supervisory roles to meet peak demands so that experienced supervisors are overseeing the majority of the contingent workforce.
A clear red flag is when you are having to constantly hire new supervisors and even look to fill these roles with contingent employees. In a distribution center, direct supervisors play a key role in driving success. High turnover or high volumes of temporary employees in these roles indicates a need to ensure that productivity commitments are being met.
Question #4: Are we retaining the right people in our core business functions?
Not all turnover is bad, particularly when it is occurring among low performers in non-critical positions. The key is to invest in practices designed to retain high performers or workers in critical roles.
To determine what should be defined as a critical position, look at both the importance of the role and how easy it is to train people for that role. Ask questions like:
- What is the cost of mistakes in this role?
- How difficult is it to replace someone in this role?
- How closely is this role tied to customer satisfaction?
Once you have pinpointed the critical roles, you can then drill deeper into the data to see where turnover is happening. By comparing how resignation rates vary across locations, functions, tenure, age and diversity groups, performance level, and more, you gain insight into how different populations are responding to their work experience. This insight is valuable in strategically investing in solutions that will deliver the biggest results.
Any time turnover rates for critical roles increase, the organization needs to take action to understand why and how it’s happening to avoid it becoming a future trend. In addition, if there are practices in place that are designed to retain people in critical roles, yet turnover is remaining the same or increasing, this indicates that the “retention playbook” needs to be revisited. The incentives to stay are not working as anticipated and should be changed.
“HR” is for Holiday Rescuer
When facing a staffing shortfall or when inexperienced staff are impacting customer satisfaction during the holiday season, it can be tempting to rush out and throw budget behind the problem. But it’s important to step back and take an analytical approach: You may, for example, even discover that a surge in turnover is not impacting your business, and therefore does not require a costly fix.
By linking your people data to business outcomes, you will be in the best position to determine where your organization should focus its efforts now and in the long term. And you may — as a result — even emerge as the “holiday hero” for your company.
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