How much productivity can be gained by modernizing frontline hiring?
How much productivity can be gained by modernizing frontline hiring?
More CEOs are finding out.
This past year has tested everyone’s resolve as companies have grappled with massive disruptions from supply chains of goods and services in the early days of the pandemic. While still not remedied 100 percent, enough band-aids have been put in place to get back on a growth path. Now a new challenge beckons: that of the elusive frontline worker.
This shadow force came front and center this past year when we suddenly realized grocery store employees and customer support agents became our essential link to civilization. While consumers felt and recognized the importance of these workers, savvy leaders are taking a second look at how they attract and retain customer-facing personnel – and are seeing a huge opportunity for improvement.
With unemployment in the U.S. at 6.3% and even higher in Canada, it might seem odd to think about frontline workers as a “supply” challenge. There may be plenty of people available to fill positions, yet companies are struggling to fill those roles – and that’s a big problem.
In today’s increasingly experience-driven economy, great customer service is a necessity. A happy customer is a retained customer. According to Bain, just a 5% increase in retention can amount to a 25% increase in profits. And great customer service depends on finding those individuals who collectively present your public face.
The frontline business case
Whether a company employs 5 frontline employees or thousands, managers are keenly aware of the impact workforce shortage has on company performance:
- Sales are directly correlated to an optimal staffing level: too few associates equals missed sales opportunities;
- Customer experience fluctuates widely based on how long it takes to properly address customer questions; this is tied to staffing levels, training and caliber of employees
- Productivity levels impact profitability and employee morale
- Brand voice is disjointed when companies are dealing with a rotating frontline workforce.
Whichever way you look at it, staff shortages have a material impact on businesses. Finding and retaining staff is prompting a growing number of companies to reexamine their hiring policies. And many are starting with the root of the problem: the top of the hiring funnel.
Staffing Process Is Ad Hoc
For all their importance, finding personnel to staff contact centers, retail outlets, hospitality, and factories largely remains an ad hoc process for most companies.
In larger organizations, human resources typically deals with the full lifecycle of the entire workforce and, from a recruiting standpoint, tends to focus most of their efforts on full-time salaried roles — where the terms of the employment agreement are readily understood; five days a week, 9-5 where hiring cycles are longer and more involved. This type of hiring is vastly different from frontline hiring.
Consequently, the sporadic – if not continuous needs for staffing local outlets largely falls outside of traditional HR and remains the field’s or department’s responsibility. As a result, the hiring chores are tedious, ineffective– and disruptive. And that disruption creates big ticket costs that often fly under the radar of balance sheets.
Do not underestimate the cost of hiring to the business
The conventional definition of recruiting costs looks at hard costs of money spent to hire divided by the number of people needed. If you apply the same formula to frontline workers, the hard costs of recruiting per person may seem manageable if external agencies and recruiters are not used.
Nonetheless, the true costs can be daunting as they never factor in opportunity costs. Here’s an example: Say a local retail manager is spending 10% of her time posting jobs, interviewing people (only to find they can’t work nights, or the early morning shift). This is time that she is not selling or servicing customers. Multiply that by the dozens of managers doing exactly the same thing, and suddenly you have a massive productivity loss.
Conversely, a lag in staffing – not being able to find the right candidate or not being able to find people for the shifts needed, can create operational nightmares that can cause other levels of disruptions.
One of our customers is a national shoe store. Most of the staffers are younger people who work irregular hours because of classes or other responsibilities. Local managers were spending more and more of the time they should have been on the floor, just mulling through resumes and mapping candidate availabilities with open shifts, time that could be used elsewhere in the stores and much of this can be automated.
What Frontline Workers Want
With unemployment still high, it’s logical to wonder why there is a disconnect between labor availability and staffing.
While salary, health risks, hours, (recent) government wage subsidy programs and personal aspirations may explain why some workers are less inclined to work frontline jobs, it’s not the whole story. Our research indicates that the gap between connecting job seekers with high volume jobs is still important, due largely to antiquated methods that haven’t kept up with the times.
That may seem hard to believe since many companies have invested in recruitment software that ties into the payroll system and benefits portal. Those tools are terrific for certain tasks yet fall short when it comes to the workflow and velocity required to hire customer-facing workers.
Let’s consider the applicants’ perspective.
Yes, they can look for available positions online. But frankly, a lot of part-time and service-worker jobs occur because they see the job posting at the physical site. First step is to fill out an application. If they are online, they send in a cover letter and a resume.
These are just not 21st century asks for people who can rent an Airbnb, book a flight, even find a spouse – with just a couple clicks. They want to find a job the same way.
The process of reviewing docs is no panacea for a line manager either. If you want managers to use the technology -and be more productive- tools need to be simple and easy to use: streamlined candidate review, integrated communications and one click job postings. There is a lot of untapped value in ensuring hiring processes and tools are adapted to how frontline workers are hired.
And what happens to the applicants who don’t get the position? You likely aren’t letting them know they didn’t get the job. And risk having that person be one of the whopping 92% of candidates who say they’ve experienced poor recruiting practices. These aren’t just applicants you are turning off. If you are a national retail chain, or the call center for a consumer product – these job seekers could be prospective customers as well.
The role of the C-suite is to look at the overall growth of the company, and the care of its employees and shareholders. Shining a light on your shadow force will likely see improvement across all three areas.