The American Mind

The end of set schedules for Wal-Mart employees may be the latest technological advantage for the retail giant. Flexible employee scheduling using software and past sales data will allow Wal-Mart to better staff its stores. Ezra Klein complains:

But pity the workforce. The new software will make advance scheduling and reliable paychecks a thing of the past. According to The Journal, “experts say [the program] can saddle workers with unpredictable schedules. In some cases, they may be asked to be “on call” to meet customer surges, or sent home because of a lull, resulting in less pay. The new systems also alert managers when a worker is approaching full-time status or overtime, which would require higher wages and benefits, so they can scale back that person’s schedule…That means workers may not know when or if they will need a babysitter or whether they will work enough hours to pay that month’s bills. Rather than work three eight-hour days, someone might now be plugged into six four-hour days, mornings one week and evenings the next.”

Klein declares it a “Brave new world.” Not at all. Flexible scheduling isn’t new. In my former life working for Barnes & Noble my schedule ranged from coming to work at 7:00 a.m. to open the store at 9 to coming in at 3:30 p.m. and leaving at midnight. I gave the scheduling manager my availability. The more shifts I was available the more hours I worked. The past few years the company began using software to better match staffing with projected sales. Employees have “on calls” shifts and come in if the foot traffic justified the payroll, and staff are asked to leave early if things get slow (we rarely complained about that). Wal-Mart being a smart tech company is taking flexible scheduling to another level.

Retail in general has some of the smallest margins in the entire economy. Bookstores “luxuriously” work with 5-6% margins. Retailers like Wal-Mart that sell commodities like food have to live with far smaller ones. Having the right amount of labor for the sales boosts profits.

Yeah, it is harder for workers to get into a rhythm with swinging schedules and uncertain hours. Because of the store’s tiny margins store managers have to get the most out of long-time workers like the $14.50/hour Wal-Mart employee mentioned by Klein. That means increasing worker productivity. In Barnes & Noble’s case it was improvements in book searching and ordering along with more efficient employee scheduling. If workers want to make a career out of retail they shouldn’t expect banker’s hours or a schedule approaching your ordinary 9-5 job. Retail is a whole different animal. Yet it will still be a place where part-time workers will be able to earn some extra cash for a few hours of work a week.

I wonder how well a system like the Kronos system used by Payless ShoeSource can deal with non-customer work that needs to get done. Inventory coming in has to be stocked, signs and displays have to be set up, and the store has to be cleaned up. Those are important jobs that are harder to calculate into manpower-by-sales equation.

Flexible scheduling can go too far. Employees who want more set schedules could find new jobs (retailers are always looking for experienced help), and potential employees could be turned off from applying at Wal-Mart because if their schedules are too flexible. Treating employees as simply cogs in the selling machine (i.e. store) with wizbang algorithms may resurrect a new “Taylorism.”

A great thing about the United States’ free market is there’s an amazing amount of choice in when you want to work, where, and for what amount as long as you consider the tradeoffs. The complete opposite from Wal-Mart’s employer-controlled flexible scheduling is Best Buy’s corporate headquarters where employees come in when they want as long as their tasks get done. I doubt Klein would complain about a “brave new world” where employers don’t know where their employees are. A smart company will have to balance flexibility with employee morale to make sure customers get served while labor costs are minimized. It’s an age-old dilemma for businesses. No amount of technology will eliminate that.

“The Great Risk Shift: Wal-Mart Edition” [via OTB]