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1 In recent years, retailers have taken steps to “lean out” their processes and gain eff iciencies—with impressive results. Lean-retailing initiatives have yielded as much as a 15 percent reduction in retailers’ operating costs. 1 But with competition intensifying and with customers expecting ever-higher service levels, many retailers are now looking for new ways to further imp rove p roductivity and enhance customer service. One major area of opportunity is workforce management : specif ically, labor scheduling and budgeting. Because of the comp lexity inherent in creating accurate staff ing schedules and budgets for a large number of stores, even sophisticated retailers find substantial room for improvement in this a rea. Off-the-shelf soft ware and solutions—although useful for important tasks such as monitoring employee attendance and managing payroll— typical ly produce generic schedules that don’ t take into account store-specific factors and workload fluctuations. The unfortunate results include high labor costs, inconsistent customer service, and dissatisfied employees. If a retailer could better pred ict the number and skill set of employees that each of its stores needs every day (or, better, every hour ) of the week, then customers would get prompt sales assistance, shelves would be replenished in a timely manner, employees would be neither idle nor over worked, and, in most stores, labor cost s would go down. Smar ter schedules, be tter budgets: How to improve store operations Through activity-based labor scheduling and budgeting, retailers can cut store labor costs by up to 12 percent while improving both customer servic e and employee satisfaction. Daniel Läubli, Gernot Schlögl, and Patrik Silén A UGUS T 2015 R C P G K e i k o M o r i m o t o

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