# Understanding Workforce Management: A Comprehensive Guide **Quick summary:** Workforce management (WFM) software helps organizations with the day-to-day managing of people. It brings together a suite of solutions — for time tracking, scheduling, compliance, and performance — into one operating platform. Workforce management helps you put people where they’re needed and keeps costs down. This guide explains how workforce management works, its core capabilities and benefits, and how enterprise, midsize, and small businesses can use WFM software to improve workforce efficiency and make more informed staffing decisions. --- Engage your team and boost productivity with a dynamic WFM solution ------------------------------------------------------------------- **Engage your team and boost productivity with a dynamic workforce management (WFM) solution that helps you align staffing with customer demand, optimize schedules, and give managers the real-time insights to make informed workforce decisions.** The result is a more efficient operation, better employee experiences, and improved business performance. Workforce management is a delicate balance between adequate staffing and customer demand. Whether you're understaffed and need more employees to handle your workload or you have a generous headcount you can't justify, it's important to strike the right balance to maintain efficiency while keeping your customers and workers satisfied. Our guide explores how workforce management software is integral to your organizational planning. We also suggest specific questions to ask when evaluating the best platform for your business. What is workforce management? ----------------------------- **Workforce management is the practice of optimizing an organization's employees to improve productivity, efficiency, and overall business performance.** WFM activities include scheduling shifts, tracking attendance, forecasting labor needs, and managing compliance. What is a workforce management solution? Traditional workforce management has relied on paper-based processes, or spreadsheets, to manually track employee activities such as leave, attendance, and shift patterns. But these repetitive tasks place a burden on management and Human Resource departments to keep records accurate and updated. A work management solution is a software platform that helps businesses automate and streamline their workforce management processes. It’s a more productive approach that eliminates the risk of human error.
**Capability** **Traditional Workforce Management** **Modern Workforce Management**
**Labor visibility**Limited visibility across schedules, attendance, and staffing. Managers often rely on spreadsheets or paper records and react after issues occur.Real-time visibility into schedules, attendance, labor demand, overtime, productivity, and staffing levels helps managers make more informed workforce decisions.
**Compliance**Manual processes make it harder to consistently track labor laws, overtime rules, leave policies, and other workforce requirements.Built-in compliance tools help organizations monitor labor regulations, automate policy enforcement, and reduce compliance risk across locations.
**Cost control**Staffing decisions are often based on manual estimates, increasing the risk of overstaffing, understaffing, and unnecessary labor costs.Forecasting, scheduling, and analytics help align staffing with demand, optimize labor deployment, reduce overtime, and better control labor costs.
Why is workforce management important? -------------------------------------- **Workforce management is important because it helps organizations drive engagement, ensure compliance, reduce operational costs, increase workforce productivity, and enable automation so managers can focus on more high-value work.** The [concept of WFM](https://www.connectionsmagazine.com/article/changing-face-of-workforce-management/ "Read more about the concept of WFM in Connections Magazine") dates back to the late 1980s when call center managers explored new ways to drive efficiency among their staff. Since then, it has been widely adopted across many other industries due to the many benefits of workforce management: 1\. Driving engagement Gallup reports that worker stress has reached record levels since the pandemic, with [52% of US and Canadian employees](https://www.gallup.com/workplace/547283/workplace-trends-leaders-watch-2024.aspx "Learn more about these stats at gallup.com") surveyed experiencing stress the previous day. [Employee engagement](/products/features/employee-communication-and-collaboration) is now a top priority for employers who have faced everything from the Great Resignation to quiet quitting as their workers strive to reduce stress and regain control over their work-life balance. In response, employers are tasked with creating a work environment where every employee can thrive. Workforce management is at the heart of this supportive culture, empowering employees to: - Take control of their schedules - Make time-off requests - Collaborate effectively with team members. 2\. Ensuring compliance Any organization must plan its workforce activities according to labor laws and regulations in your state or region. These may relate to: - Working hours - Minimum wage - Leave entitlements - Health and safety standards. WFM tools allow managers to monitor and track compliance, ensuring the organization operates within legal boundaries. 3\. Supporting hybrid work The hybrid working model has been gaining pace since the pandemic, as employers and workers recognize the value in working from home for at least part of the week. Gallup research notes that 32% of remote-capable workers were hybrid in 2019, but [now that number sits at 52% in 2026](https://www.gallup.com/401384/indicator-hybrid-work.aspx). With hybrid working roles more common, WFM solutions are essential for managing remote teams and keeping them aligned with the rest of the organization. 4\. Reducing operational costs Workforce management tools provide detailed, real-time insights about how, when, and where your employees are deployed across your organization. By managing overtime, reducing idle time, and optimizing shift schedules, organizations can enjoy decreased labor costs in line with the company's financial goals and budgets. 5\. Increasing workforce productivity With a WFM solution, businesses have real-time visibility into their workforce. With AI-powered scheduling recommendations and the ability to make data-driven decisions, employees are better utilized, which improves the organization's productivity and efficiency. This employee productivity boost is essential for companies looking to transition to a four-day working week, using a framework of 100% salary, 80% hours, and 100% productivity. [Microsoft Japan](https://news.microsoft.com/ja-jp/2019/10/31/191031-published-the-results-of-measuring-the-effectiveness-of-our-work-life-choice-challenge-summer-2019/ "Learn more about how Microsoft Japan improved productivity") improved productivity by 39.9% in 2019 to make this a feasible solution, and many other countries are now piloting their own approach to the four-day week. 6\. Enabling automation Effective workforce management encompasses every aspect of the employee lifecycle, from recruitment and onboarding to retirement. The best WFM solutions will integrate with other essential HR technologies, such as human capital management (HCM) and/or payroll systems. This approach creates a unified solution that: - Streamlines key processes - Reduces manual data entry - Improves accuracy By automating these tasks, managers can focus on more critical aspects of workforce management, such as employee satisfaction and engagement. What are the main goals of workforce management? ------------------------------------------------ **The main goals of workforce management are to forecast labor demand, optimize staffing, control labor costs, ensure compliance, and improve productivity.** Workforce management also gives organizations the visibility and data they need to make more informed workforce decisions. Companies interested in deploying a [workforce management solution](/products/workforce-management "Learn more about UKG workforce management solutions") have specific objectives to drive the implementation forward. The most common of these strategic goals include: Making accurate workforce predictions From seasonal demand to the impact of generative AI, companies experience fluctuations in their headcount requirements and must find a way to forecast their future labor needs accurately. WFM solutions can help meet this goal by analyzing: - Historical data - Upcoming events - Skills gaps - Other factors affecting staffing levels. By accurately predicting labor needs, organizations can optimize staff schedules to minimize costs while maximizing productivity. Achieving compliance As labor requirements constantly evolve, businesses must stay on top of any regulatory changes to meet compliance obligations. Speaking on a [webinar](https://my.demio.com/ref/jwLBvzyMMtoKkdYm "Watch the webinar on demio.com"), WFM Application Consultant Matthew Grabowski explains, *"At UKG, we're all about making sure we're compliant with state and federal regulations. A company I'm working with has had in excess of $38 million in fines in the last six years, so compliance is the biggest issue right now when we're looking at workforce management."* Inspiring a culture of action With the fast pace of modern business, organizations don’t have the luxury of waiting around to see what happens next. To stay competitive in the market, they must take a proactive approach by anticipating and addressing the challenges and opportunities before them. With the right tools and data at their fingertips, managers can make swift, informed, and ethical decisions to achieve their business goals and inspire innovation within their teams. Doing so drives business growth and cultivates a work culture that values initiative, strategic foresight, and continuous improvement. Overcoming barriers to global expansion Whether expanding your business into different countries or new markets, your organization will likely encounter some obstacles. There are many factors to consider, from language and cultural differences to compliance risks and industry-related regulatory requirements. WFM solutions overcome these barriers, providing tools to: - Facilitate cross-country communication - Simplify scheduling across time zones - Ensure compliance with local labor laws With a robust employee management system, you can expand your business operations without worrying about losing control over your global workforce. Improving efficiency Efficiency directly impacts your organization’s bottom line. Reduced waste, faster output, and less idle time will save you money, freeing up resources to invest in other areas of your business. While streamlined processes are undeniably linked to productivity, your employees’ energy levels and preferred working patterns are also critical. Employers can unleash efficiency by giving employees access to workforce management systems, enabling them to swap shifts, request time off, and enhance their work-life balance in just a few clicks. The ability to manage employee schedules independently fosters a sense of autonomy in your workforce—a key factor in driving productivity and engagement, with an excellent return on investment. **Case study:** Nucleus Research conducted an ROI analysis of 11 WFM deployments, which revealed that [every dollar spent on WFM](/learn/resources "Read the report") delivered $12.24 in terms of benefits, time savings, retention, engagement, and payroll. Companies can expect to receive payback in as little as five months. What are the main functions and features of a workforce management solution? ---------------------------------------------------------------------------- **The main functions and features of a workforce management solution are time and attendance tracking, employee scheduling, labor forecasting, workforce analytics, employee communication, and strategic workforce planning.** Together, these capabilities help organizations optimize staffing, control labor costs, improve productivity, and support compliance. The software market offers numerous workforce management solutions, each with different bells and whistles to choose between. Although the options can seem endless, you can expect a quality [WFM solution](/products/ukg-pro-workforce-management "Learn more about UKG Pro Workforce Management") like [UKG Pro](/produtos/ukg-pro-workforce-management)® Workforce Management to have the following key features in common: Time and attendance Time tracking is a staple of workforce management that links with payroll. It allows businesses to accurately record the hours employees work. With timekeeping automation for both hourly and salaried workers, employers can: - Reduce manual tracking and data-entry errors - Eliminate time theft - Comply with labor laws Attendance tracking also provides insights into planned, incidental, and extended absence patterns. Managers can identify areas for improvement, such as addressing chronic lateness or reducing unplanned employee absenteeism. Scheduling Staff scheduling is a complex task influenced by: - Employee availability - Shift preferences - Labor regulations AI-powered scheduling recommendations allow employers to create optimized schedules for their employees in minutes rather than hours. With better visibility into staffing requirements, managers can avoid overstaffing or understaffing situations, resulting in cost savings and improved productivity. Additionally, employee scheduling features like self-service and shift swapping allow staff to work flexible schedules, leading to increased job satisfaction and engagement. Analytics Labor management analytics offers organizations valuable insights into their workforce data. With real-time, customizable dashboards and reports, employers can track key performance indicators like labor costs, productivity levels, and overtime trends. These data-driven insights empower managers to make strategic decisions that align with the organization's goals and objectives. Employee communication Give your people a voice by enabling open dialogue between managers and employees. WFM solutions offer built-in communication tools, such as group chats, direct messaging, and company-wide announcements, to inform employees about their schedules, time-off requests, shift swaps, and other important company news or policy changes. This feature also allows managers to gather crucial employee feedback. Strategic workforce planning As skills gaps widen and headcounts change, employers must commit to [workforce planning](/blog/operations-leaders/workforce-management-how-elevate-your-workforce-planning "Read this blog on how to elevate your workforce planning") to anticipate their future needs. WFM software helps HR leaders and managers with capacity planning and workload budgeting based on: - Historical data - Budget constraints - Business goals This strategic approach to demand forecasting allows organizations to adapt quickly to changing business environments and stay ahead of the competition. How does WFM vary according to industry or company size? -------------------------------------------------------- **WFM can vary according to industry or company size by supporting different business priorities and workforce complexity.** Organizations of all sizes use the same core workforce management capabilities, but larger businesses often require greater scalability, customization, and compliance support. Workforce optimization is a best practice for any type of organization in any industry. For example: - [Retail](/blog/operations-leaders/how-retailers-can-build-accurate-labor-model "Read how retailers can build accurate labor models") companies might be concerned about creating a labor model that adapts according to fluctuating customer demand and economic disruption. - [Healthcare](/blog/operations-leaders/healthcare-scheduling-software-3-ways-improve-healthcare-staffing "Read more how scheduling software can improve healthcare staffing") organizations may want a solution that leans on data to solve short-staffing problems. - [Manufacturing](/blog/operations-leaders/4-strategies-attract-and-retain-talent-manufacturing "Learn how to attract and retain talent") businesses may want to improve their workforce scheduling processes to retain skilled workers longer. Looking beyond industry differences, your WFM approach may also vary according to the size of your organization: Small businesses Small businesses have the following considerations: - **Budget constraints:** Small businesses often have limited resources and could benefit from low-cost WFM tools that are easy to implement. - **Simplicity and usability:** Tools and processes should be user-friendly, as small businesses often lack specialized staff to manage complex WFM systems or the time to dedicate to training. - **Basic compliance needs:** Ensuring compliance with federal labor laws and regulations can be more straightforward for smaller teams. Medium-sized businesses; As your business grows, your WFM system should easily scale up to accommodate more employees and complex schedules. Some essential considerations include: - **Integration capabilities:** Syncing your WFM solution with other systems, like payroll and HRIS platforms, streamlines your processes and eliminates data redundancies. As your business grows, you may also require robust integrations with customer relationship management (CRM) or enterprise resource planning (ERP) systems. - **Enhanced compliance management:** As the workforce grows, managing compliance becomes more complex and crucial. - **Departmental coordination:** Different departments or branches might have varied WFM needs, and your system should cater to this diversity. Large enterprises Enterprise organizations typically have more complex scheduling needs, with multiple shifts, locations, and job roles. Ensure your WFM software solution accommodates the following: - **Advanced reporting:** Sophisticated analytics can track productivity, labor costs, and other key performance indicators. - **Customization:** Each organization is unique, and your WFM should be able to accommodate specific organizational processes and policies. - **Comprehensive compliance management:** Large organizations often operate in multiple jurisdictions, making compliance management more complex. - **Employee self-service portals:** Empower employees by giving them access to schedules, leave requests, and other core HR functions. How to choose a workforce management solution --------------------------------------------- **Choose a workforce management solution that’s right for your organization by conducting extensive research and putting together a shortlist of WFM tools, then pitting them against each other before you invest.** Here is a checklist to work through during your [WFM evaluation process](/blog/operations-leaders/workforce-management-how-elevate-your-workforce-planning "Read this blog to learn how to elevate your workforce planning "): Core features - What specific workforce management needs does our organization have, and how well does the solution address them? - Does the solution offer flexibility and customization to adapt to our specific industry and operational requirements? - What features does the solution offer to streamline and improve processes like scheduling, time tracking, and leave management? Pricing - What is the solution's total cost, including setup, subscription, and any additional fees? - How does the pricing structure align with our organization’s size and budget constraints? - Are there flexible pricing options that scale with the growth of our organization? Compliance - How does the solution ensure compliance with relevant labor laws and industry regulations? - How does the system update when these legal requirements change? - Are there features to help manage union rules, overtime, and other compliance-related aspects? Integrations - Does the solution integrate easily with existing HR, payroll, and enterprise systems? - How does it handle data sharing and synchronization across different platforms? - Are there APIs or other technical supports for custom integrations, if needed? Employee experience - Is the platform intuitive for new users? - What feedback have our employees provided about their experience? - Are there features that specifically cater to improving [employee engagement](/produtos/gestao-da-forca-de-trabalho) and satisfaction Scalability - How well can the solution adapt to our organization's growth and changing needs? - Do any limits exist for the number of users, locations, or data volume? - Can the system handle complex organizational structures as the company expands? Data security and privacy - What measures does the solution use to protect sensitive employee data? - Does the platform comply with data privacy regulations like [GDPR](https://gdpr-info.eu/ "Learn more about GDPR at gdpr-info.eu") or [CCPA](https://oag.ca.gov/privacy/ccpa "Learn more about CCPA at oag.ca.gov")? - How does the system handle data backups, recovery, and breach responses? Customer support and training - What type of customer support is offered? For example, 24/7 phone support, live chat, or community knowledge base. - Are there comprehensive training resources and programs available for administrators and end-users? - What do other customers say about their experience with support and training effectiveness? Optimize workforce management with UKG -------------------------------------- **UKG helps organizations optimize workforce management by bringing time and attendance, scheduling, labor forecasting, analytics, and employee communication into a single platform.** [UKG Pro Workforce Management](/products/ukg-pro-workforce-management "Learn more about UKG Pro Workforce Management") offers a customizable approach to workforce management for mid-market and enterprise organizations with complex business needs. Whether you need to track attendance, improve resource allocation, or boost productivity, our WFM platform will provide an elevated experience for all. Ready to optimize workforce management in your organization? Take a [product tour](/learn/resources/demos/ukg-pro-workforce-management-demo "Take a short tour of UKG Pro Workforce Management") today or [contact our sales team](/get-started?pcta=gs#sales "Contact us for more information") for more information. Frequently asked questions about workforce management software --------------------------------------------------------------
What are the benefits of workforce management software?
Workforce management (WFM) software helps organizations improve scheduling, track employee time and attendance, forecast labor demand, control labor costs, support compliance, and increase workforce productivity. Modern systems also provide managers with real-time workforce insights to make faster, more informed staffing decisions.
What should you look for in a workforce management solution?
Look for a workforce management solution that includes time and attendance, scheduling, labor forecasting, workforce analytics, compliance support, employee self-service, and integrations with payroll and HR systems. The right solution should also scale with your organization's workforce and operational complexity.
How does workforce management software help control labor costs?
Workforce management software helps control labor costs by forecasting labor demand, optimizing schedules, improving workforce visibility, and aligning staffing levels with business needs. It also helps organizations reduce unnecessary overtime, maintain service levels, support compliance, and make more informed workforce decisions.