USING SMART SCHEDULING IN YOUR JOB COSTING STRATEGY
Gail Tutt, TEAM Software Business Consultant, Network Partner
Moving into the new year, it’s important to look at how you can strengthen your profit margins. Especially when other market factors (like ongoing labor and supply shortages) are carrying over into 2022. One tactic you can consider? Use scheduling, particularly smart scheduling, as a part of your job costing toolkit.
What’s smart scheduling?
In short, smart scheduling is a system that does the heavy lifting for you when it comes to your officer schedules. This means factoring in your contract needs against your available officers, so you can make data-backed decisions when posting officers to jobs based on criteria like qualifications or pay rate.
One simple way to keep jobs profitable is to deploy smart scheduling early in the process. When scheduling, include a parameter search for available guards that fit within a job’s contract bill rate. That way, you know officers on shift are within the scope of what’s budgeted per job. (If you skip this step, wage creep could get ahead of you, and it can show in your expenses.)
If this isn’t something you’re used to doing, start by using smart scheduling reports in your enterprise workforce management solution to examine your labor margin direct labor (DL) percentages. If you know a particular job should be performing at a DL of 60%, you can compare it against your actual percentages to see if a job’s material costs are performing higher or lower than budgeted. If it is higher, drill down into the report to identify the problem. Chances are, if there’s a problem with one job going over DL, it’s a problem across your business. Is a manager scheduling officers without factoring in pay scale? Are you scheduling officers for a shift when a different job is needing their certifications? Is wage creep pushing you over budget?
If your job’s DL is lower than benchmarks, you can still dig into the data and see what processes you can repeat on other jobs. From there, it’s only a matter of adjusting and measuring outcomes.
At TEAM, we recommend reviewing your DL percentages with regularity. Assuming schedules are updated daily, a good rule of thumb is to review at least weekly. That way, you can catch budget deviation before it comes a larger issue.
Flexible scheduling to support smart scheduling.
While software solutions can help automate your scheduling needs with smart scheduling, they improve scheduling in other ways, too.
Think of scheduling as a larger job costing strategy. Self-scheduling through a feature like a mobile job board can improve employee engagement. In turn, this can improve retention and even reduce high-cost activities like overtime.
Where smart scheduling helps identify officers who are the right fit for a given shift, self-scheduling helps empower officers to offer their shifts to others without needing to involve a scheduler or supervisor. Others can then pick up the open extra work, keeping shifts filled without needing to go back-and-forth with a manager.
Don’t forget to factor in compliance. If your scheduling solution allows it (and believe me, it should) configure criteria on your self-scheduling job board so only qualified employees can fill certain shifts. This helps support job costing by keeping direct labor expenses reasonable per job.
Scheduling for profits — and retention.
Here’s a crazy idea: instead of filling gaps, consider creating them. I know — crazy — but hear me out.
Expand your current, labor-intensive scheduling processes to include self-scheduling. This reduces some of the manual work demands of your managerial staff and engages your officers to have a say in their own schedules.
I’ve heard of some security companies piloting scheduling programs that strategically leave a small percentage of the global work schedule unfilled. By hiring a portion of your workforce in a self-scheduling-only capacity, you can have a subset of officers set their own schedules by filling open shifts. This approaches the smart scheduling, and retention, strategy from a whole new angle.
For example, let’s examine an officer who’s decided to leave your company. They could be leaving to work a different job, but still be hoping to make some extra cash on the side. In the pilot program described above, that officer could choose to stay an active employee within the self-scheduling program, picking and choosing shifts that fit around their new work schedule.
- Your company doesn’t lose out on any investment you’ve put into their hiring.
- The officer has a flexible avenue to earn extra money by choosing jobs from your available contracts.
- If the officer ever chooses to return to working for you full-time, their employee records are still on file. This streamlines your rehire process and cuts out added hiring expenses.
Gail has spent over 35 years in the private sector as a senior level finance and operations manager across multiple industry. Most recently CFO of a regional security company in San Jose, CA, Gail now works providing invaluable insight and expertise as a business consultant with TEAM Software. Her hobbies include breeding and showing standard wirehair dachshunds, hiking and spending time with her family.