Can We Improve Labor Costs and the Customer Experience?

As business people we are continually faced with “either/or” answers to directives to improve costs without sacrificing customer service.  “Since almost every employee can directly impact quality, cost, or service through the execution of his or her daily tasks, the potential impact of increased engagement on top- and bottom-line performance is tremendous.”   Getting the right people, in the right place, at the right time fuels engagement.  

I was speaking with Dave Bruno, editor for Commerce in, about productivity as it relates to improving the customer experience in the hospitality industry  and thought the points from their report below were excellent.   I hope you enjoy it.  

People: Extending the Productivity of Every Hour

As modern organizations look to gain market share based on a differentiated customer experience, many are realizing they need to invest in solutions and processes that enable them to go beyond simple cost-cutting measures and find ways to better manage and empower their workforce.

Case studies in industries from retail to distribution to manufacturing have proven that extending the productivity of every employee and synchronizing staffing levels with peaks in demand often results in improved customer loyalty and increased revenue, as well as improved margins and profitability.

In addition, where companies once attempted to optimize labor within separate areas of their business, many are now evaluating their ability to influence the workforce at the enterprise level. Boardroom discussions now factor in how staffing and productivity improvements can impact everything — from the way products are sourced and shipped, to the way they are supported after the sale is complete.

New Realities—Balancing Productivity & Profits

Most businesses have been attempting to walk the tightrope of investing in the customer experience while at the same time looking to better manage labor costs. In order to realize these seemingly opposing goals, leading companies are focusing on driving productivity to improve return on invested labor.

From manufacturing plants to distribution centers to retail sales floors, leading organizations are improving productivity by investing in tools and processes that provide greater visibility and deeper intelligence into customer timelines, preferences, activities and histories and then aligning that visibility and intelligence with new demand signals.

However, transforming an organization to align talent and strategy is often a delicate balancing act. Some of the new realities companies must account for as they look to optimize this critical people component of the Commerce in Motion Framework include:

  • Aligning talent and strategy, both from matching staffing to demand, as well as hiring and training for new skill sets;
  • Developing agile scheduling systems that allow organizations to address shifts in demand/production and also serve an increasingly empowered workforce who are looking for increased flexibility in their schedules;
  • Serving an increasingly global customer base, with an equally dispersed workforce;
  • Managing compliance and labor laws on a regional level around the globe;

Matching Staff To Customer Demands & Needs

According to 2011 research from consultancy Workforce Insight, improving customer experience/customer satisfaction was the top driver companies cited for investing in workforce management, selected by 85% of respondents. In order to improve the experience, these organizations are realizing the need to integrate their Workforce Management solutions and processes into their entire supply network.

85% of organizations cite improving the customer experience as the top driver for
investing in workforce management

—Workforce Insight

Scott Knaul, VP Strategic Services at Workforce Insight, recommends that organizations take a scientific approach to managing the customer experience, and that they must first “define and quantify” their strategy. “Companies must first determine their clients’ expectations and determine the experiences they are going to provide to meet or exceed those expectations,” Knaul said. “Then, just as importantly, they must establish metrics that support how they are going to deliver on that experience.”

The desire to have the right staff on hand to meet peaks in demand is a consistent goal for all businesses today, whether it is a manufacturer managing production lines or a retail store staffing its sales floors.  Read the entire report at Commerce In Motion | The 4 P’s of Commerce/People

How are you utilizing intuitive technology solutions to maximize your rate of return and customer experience? Do you think it is possible to leverage technology to increase revenue while you decrease costs?

Jim Thomas handles business development focused on the hospitality and leisure industries for RedPriairie.   You can reach Jim at

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