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The Ultimate Guide To Workforce Management

Good workforce management reduces costs, improves performance, and saves everyone time. Here’s how to implement a workforce management plan at your company.

One by one, the content studio team clocked out for the day.

It was a special Friday, too — new hourly rates would kick in across the board. After a stellar year of profits, management had approved a 30% increase in everyone’s pay rate.

New leave requests were coming in, too. Some people, like Tom, would be off next week on vacay, while others, like Karina, only needed half the day off on Tuesday.

Rumi, the manager, watched the notifications come in on the workforce management system. The hours got tallied automatically, and she approved the payments for the month.

But she spotted a few gaps. The copywriters would be out on holiday next week, so the studio would need to reach out to its pool of freelancers. 

Rumi also needed to schedule next week’s content workload and prepare a report for the regional management team. 

The team would use the data to review workloads across their branches and determine if they needed to revise their retainers.

Individually, these tasks seem like part of the average manager’s workload. Taken together, they form part of workforce management — a crucial function of any effective management team.

And decades ago, these workforce management processes would’ve taken days to complete. Today, many businesses use workforce management software to complete them in minutes.

Definition: What is workforce management (WFM)?

Workforce management means maintaining a productive workforce by tracking attendance, crafting employee schedules, and managing leaves and documents (handbooks and policy docs).

It includes measuring and improving productivity and reporting on time, engagement, and performance levels.

Workforce management supports operations in manufacturing, logistics, distribution, law enforcement, healthcare, and retail.

The core of workforce management is time and attendance tracking, although it extends beyond these functions.

Workforce management is especially important in the age of telecommuting and remote working. 

In this context, it’s sometimes referred to as mobile workforce management or remote workforce management. 

Remote workforce management helps improve long-distance collaboration, remote resource management, accountability, and productivity tracking.

“The global mobile workforce is expected to reach 1.88 million in the year 2023″
     — IDC report, 2020
Workforce management for remote employees

Is workforce management the same as workforce optimization, project management, or human capital management?


Workforce optimization involves using tech to improve the effectiveness of your workforce and collect feedback faster.

An example of an optimized process is going from long wait times on support calls to speedy resolutions using artificial intelligence (chatbots).

There is also a difference between workforce management and project management. Where workforce management is about improving and optimizing your workforce, project management is more focused on optimizing tasks and projects.

FreeAgent Project Management Software

Lastly, workforce management forms part of human capital management (HCM). HCM includes managing:

  • Performance management
  • Benefits administration
  • Company directories
  • Talent management
  • Employee records
  • Talent acquisition
  • Staff learning
  • Analytics
  • Payroll
FreeAgent helps you manage elements of human capital management

5 common workforce management challenges

Why bother with workforce management to begin with? Companies rethink their workforce management approach when they hit one or more of the following roadblocks:

  • Manual staff management: After assessing the true time-cost of managing teams manually, many managers consider automating and digitizing their workforce management processes.
  • Inaccurate reports: Without a central way to view all data related to their workforce, managers may end up with inaccurate reports on time, attendance, and payroll. 
  • Compliance risks: Poor reporting may increase the risk of violating data privacy laws, labor laws related to pay and other benefits, and other compliance requirements.
  • Excessive absenteeism: At a larger scale — especially for remote workforces — managers may not know who’s actually showing up to work and who’s skipping out.
  • Disparate documents: Files and data stored across several storage drives, branch locations, and which are controlled by different people may make information hard to search for, organize, or amend.

These challenges contribute to operational inefficiency, causing management teams to seek smarter ways to manage their workforces.

Manual calculations slow down workforce management
“Highly engaged business units enjoy a 41% reduction in absenteeism and a 17% increase in productivity.”
     — Gallup

But workforce management doesn’t just benefit managers — it benefits their team members too. 

Everyone, from the sales rep or project manager to the call center director or VP can benefit from greater speed and transparency in workforce management.

Workforce management benefits many people

12 reasons why you need better workforce management

People are at the heart of any business. From a manager’s point of view, good workforce management helps you to manage and improve:

  1. Scheduling: Create and track tasks or project schedules for each employee while accounting for rest times and overtime.
  2. Performance management and morale: See who’s working and who’s slacking. Increase transparency across the board while improving communication.
  3. Time attendance: Enable team members to clock in and out more seamlessly, helping you understand peak productivity periods and bottlenecks.
  4. Leave: Track and manage leave and availability and respond to business needs more nimbly.
  5. Payroll: Compensate fairly, centralize payroll data, and maintain compliance by calculating labor and overtime more easily.
  6. Budgeting and forecasting: Predict workforce costs and budget needs for each job and reallocate finances to the right places.
  7. Error rates: Reduce errors in payroll or project deliverables through better scheduling and tracking, saving you costs.
  8. Training management: Administer, track and report on employee training. Training can be for compliance, onboarding, or safety purposes.
  9. Compliance: Avoid litigation costs, media storms, reputational damage, and employee disappointment.
  10. Transparency: Enable each employee to access their data and see the same information as their manager, such as leave accruals, work requests, and pay calculations.
  11. Expectations: Set and manage expectations for each employee or project and generate useful KPIs for your team.
  12. Reports: Generate useful reports for centralized visibility across all your workforces, especially remote teams.
“In 2025, 60% of large enterprises with hourly-paid workers and variable demand for labor will still be using mostly manual (non-automated) scheduling approaches”
     — Gartner
Workforce payroll challenges may cause compliance risks

How to implement a better workforce management plan

Knowing the benefits of workforce management is one thing, but how do you implement it in real life?

1. Articulate your workforce management goals

Assess your growth trajectory and determine what you’d like to achieve one year, three years, and five years from now. 

Your end goals will determine the right direction for your workforce management plan.

2. Identify current workforce management processes and pain points

With your goals firmly in mind, assess where you stand in terms of your current workforce management processes. This means reviewing your:

  • Leave requests
  • Shift scheduling
  • Pay calculations
  • Workforce reporting
  • Schedule distribution
  • Supervisor approvals

For each aspect, determine the major blockers and friction points to alleviate. Which of the above tasks could you automate, delegate, or eliminate?

3. Identify your stakeholders

Who are the employees, team leads, regional managers, and external partners involved in your workforce? 

What type of information and visibility do they need to do their jobs better?

Identify your workforce stakeholders

4. Assess your tools

What tools do you currently use to manage your workforce? Are you doing everything manually, making use of spreadsheets, or using a different workforce management system altogether?

5. Determine your labor costs

How much does it cost you to manage your workforce from a time and money perspective? Looking at your revenue, what’s the ROI on these tasks?

6. Get buy-in

Implementing a workforce management plan requires everyone’s participation. Get buy-in from your team and establish a feedback loop to improve your plan as you go.

Get buy-in with your workforce stakeholders

7. Set KPIs

Workforce management KPIs galvanize your team around concrete goals. Consider the following KPIs to implement:

  • Employee engagement: Track time and manage vacation days to determine overall employee engagement and availability.
  • Employee productivity metrics: These can include time-to-completion, number of tasks completed, or the total number of sales calls made.
  • Labor metrics: Good workforce management helps you understand the size of your workforce at any given time to better help with scheduling and hiring. It also helps you manage workforce attrition.
  • Revenue per employee and total workforce cost: With a better grasp of your workforce size and payroll, you can calculate the average revenue per employee and total workforce cost at your company.
  • Training: Onboarding and upskilling employees is core to workforce planning. Get an overview of who on your team has successfully completed their training modules.
  • Customer satisfaction: A trained, engaged, and motivated workforce leads to happier customers and higher net promoter scores (NPS).

Determine how you’ll measure the success of the above elements and communicate these KPIs to your team.

63.3% of companies say retaining employees is actually harder than hiring them.”
     — Zenefits
Team KPI planning helps attain goals

8. Leverage workforce productivity analytics

Your workforce management system generates useful data you can review and use to improve. 

For example, you can use collected data to fuel 1-on-1 meetings, discuss career trajectories, mitigate sagging performance, and prevent burnout.

9. Tap into tech

The right tools can boost any work management plan. It’s even more important to gain mass adoption for said tools and give your team the training they need to master them. This is where workforce management software comes in.

Use tech for training

What is cloud-based workforce management software?

Workforce management software, also known as a workforce management system, is software built to make the workday easier. 

Some workforce management tools are described as ‘cloud-based,’ meaning you can use them from any location without installing new software.

Others may state they’re mobile-based, meaning you can use them on desktop and mobile devices, too.

However, workforce management software goes beyond just time, attendance, and employee scheduling management. A good workforce management solution gives you visibility and insight into:

  • Staff availability/absences
  • Workloads and deliverables
  • Completion rates and times
  • Employee and resource costs

Using those insights, you can improve different aspects of your operational planning, such as:

  • Hiring (through labor forecasting and budgeting)
  • Payroll (through automated pay calculations)
  • Safety (monitor and reduce incidents)
  • Work or leave approval routines
  • Compliance around workloads

Before implementing a workforce management system, you’d manually review job sheets and leave request forms. 

You’d also spend a lot of time gathering data points for better scheduling, task management, and payroll compilation.

After implementing workforce management software, it’s easier to schedule tasks, track performance, and pay people.

FreeAgent CRM Workflow

Types of workforce management software

Businesses use a mix of spreadsheets, paper-based processes, online tools, and physical whiteboards for workforce management.

While there are merits to each of these processes, such a mix of tools can be highly inefficient.

So what’s the best tool for workforce management? We’ve identified four different types of tools businesses use:

  1. Enterprise resource planning (ERP) software: ERP software can integrate data across several business lines, such as sales, order management, accounting, payroll, and logistics. However, it can be pricey to buy, take long to implement, and require extensive training.
  2. Accounting/payroll software: While you can manage lots of pay-related tasks with accounting or payroll software, such software is usually not equipped to handle leave requests, onboarding checklists, attendance tracking, or employee performance management.
  3. Human Resource Information Systems (HRIS) or Human Resource Management System (HRMS): These tools can handle benefits administration, onboarding, training, performance management, and applicant tracking.
  4. Customer relationship management software (CRM): CRM software combines the functionality of ERP, payroll, leave management, and human resource management software. It’s also cheaper and faster to implement than ERP software.

Regardless of your choice, it’s essential that your workforce management system tracks everything in one place.

FreeAgent Product Management CRM

Evaluation checklist for workforce management software

Your final choice will depend on your needs, but there are specific aspects to thoroughly consider as you choose your next workforce management tool.

  1. Easy to use interface: Is the tool easy and intuitive to use? Speak to stakeholders, read reviews, and do demos to find a tool your team will love.
  2. Features: Does it enable labor tracking, job costing, task management, and leave management?
  3. Data collection snd reporting: What information can you collect using the tool? Can you generate useful reports?
  4. Mobile and cloud-based: Is the tool mobile-enabled? Mobile-enabled workforce management software is best for teams that work in the field. It’s also beneficial for remote team workers who need to update their availability and attendance on the go. 
  5. Cloud-based vs. on-site: Is your data available at all times? Cloud-based workforce management software is best for companies that need a platform-agnostic tool with minimal implementation and no software installations.
  6. Automation: Does the tool allow you to automate repetitive tasks that require little to no human intervention? Can you build workflows around these automations?
  7. Integration: Does the software integrate with third-party apps such as payroll, ERP, project management, email, or chat apps? Do those integrations come free or for a fee?
  8. Data security: Is your collected data safe and compliant? Can you request or export a copy of it whenever you need to?
  9. Value for money: Does the tool’s pricing make sense for you? Note that you’re assessing the price based on license fees, deployment costs, training costs, usage costs, and extensions or integrations.
  10. Implementation time: Do you need to wait weeks or months before implementation is complete, or can you start using the tool right away?
  11. Employee self-service: Can employees see and manage their own data, log leave requests, and view their tasks in one place?
  12. Support: Is there adequate support for the software? Can you reach its support team at any time? Does priority support require an extra fee?
  13. Scalability: Is the workforce management tool able to scale with your growth?

To find different workforce management software options, start your search on review sites like G2 and Capterra

Read real customer reviews, compare software tools, and do demos to make an informed decision.

FreeAgent project dashboard

Why CRM is best for workforce management

Modern customer relationship management (CRM) software ticks many of the above boxes. With CRM software, employees can:

  • Clock in and out of tasks at different locations
  • Get clarity on work that needs to get done
  • Receive reminder notifications
  • Work from a shared task list
  • Complete assigned work

This is possible because most CRMs:

  • Are multi-platform, meaning you can use them from different devices (desktop and mobile).
  • Centralize data, so you can see what’s happening at a glance and improve your remote workforce management.
  • Provide robust reporting, so you can generate useful reports and perform analytics.
  • Enable project management through features like boards, lists, and tasks.

Choose FreeAgent CRM for workforce management today

Good workforce management reduces costs, improves performance, and saves everyone time. 

FreeAgent CRM is a leading CRM + work management platform that helps businesses manage their workforces across different locations, devices, and projects. 

FreeAgent CRM integrates with other tools to provide an all-in-one virtual workstation.

To see this in action, get a FreeAgent CRM demo today.

With FreeAgent, Work's Better
Mo Shehu

Mo Shehu

Mohammed Shehu, Ph.D. writes on marketing, content, and tech for B2B brands. You can find him online @shehuphd everywhere.

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