What You Need to Know
Hourly wage industries such as retail, food service, and hospitality — which comprise a majority of the U.S. workforce — have historically struggled with attracting and retaining good workers. Pandemic-fueled attrition in this sector has intensified the need to improve employee satisfaction. Companies seek efficient ways to plan and account for labor costs even as they comply with state and federal workforce regulations — all while creating a positive experience for employees, which impacts both productivity and repeat business from customers.
By implementing capabilities in artificial intelligence (AI) and machine learning (ML), organizations are solving challenging problems and automating increasingly complex recurring tasks. AI, ML and other technology-powered solutions can manage concrete workforce management (WFM) issues such as compliance, budget control and work-sharing and improve the more abstract, but no less important, issue of employee satisfaction — which in turn impacts customer satisfaction (3Sixty Insights BWSRN2142 – Concrete vs. Abstract HCM: The Power of “And,” April 2021). These technology-powered solutions, which Legion provides, can reconcile the needs of the organization and its workforce with efficiency and cohesion.
Identifying Employee Satisfaction Challenges
Industries that rely on low-cost hourly labor (e.g., food services, retail, and hospitality) need to focus on people as a driving factor to profitability. A central principle of the Service Profit Chain, a business model launched by Harvard Business School service firm experts, states that customer satisfaction starts with good staffing and satisfied employees. In the retail, food service, hospitality and similar industries where hourly frontline workers interact directly with customers in real life, the Service-Profit Chain applies today as much as it ever did. Those companies that have evolved their business models to be as flexible as possible for both customers and employees — for instance, stores that offer online retail rather than only brick-and-mortar transactions, or food delivery and rideshare services whose drivers work with the agency to choose their own assignments — have increased profits by evolving to meet human needs. From a broad perspective, these concepts align with related observations from 3Sixty Insights (3Sixty Insights BWSRN2211 – “Choose Your Own Adventure: Returning to the Workplace, Protecting the Employee Experience,” January 2022).
When the pandemic-precipitated “Great Resignation” saw 60 million Americans leave their jobs, many of them hourly, Legion set out to identify what causes might be at play. The company conducted a retail and service industry survey in May 2021 that received 500 responses from hourly workers and another 500 from managers of hourly workers. The survey revealed two overlapping WFM issues among these stakeholders: scheduling and communication. A lack of schedule empowerment, meaning having some degree of control over one’s schedule, and poor communication are the two most common reasons an employee would quit their job, other than pay. At the same time, managers said the two most important things their employers could do to improve their lives would be to reduce administrative burdens such as scheduling and providing them with tools to make it easier to communicate with their teams.
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