Published on Wednesday, Jan 23, 2008
Have you ever spared a thought to finding out what is the optimal number of employees needed to keep your organisation running smoothly?
Isn’t there an outside chance that your company may be overstaffed or, even worse, understaffed?
Hang on a minute before flippantly dismissing this as yet another superfluous management funda!
It is critically important to get staffing levels right as too large or too small a workforce negatively impacts an organisation’s mainstay – its ability to do business and attain its goals and objectives. Even international surveys bear out a direct correlation between organisational profitability and right-sized staffing. General Motors’ Chet Watson also reiterates, “In order to deliver the types of services that our customers expect of us, we need the right staff size, the right people and the right skill sets”.
Therefore, think again. Couldn’t the palpable turmoil buffeting your organisation be linked to an inappropriate staffing level? After all, apathetically carrying on with either an overabundant or insufficient labour force has devastating effects on employee productivity, motivation, commitment, stability as well as sustainability.
But if you aren’t convinced yet, try to envisage the knock-on effect of a short-staffed department. The continual overload of being several people down augurs a classic case of employee overwork. The constant overburden and exhaustion not only diminishes efficiency, but also causes the organisation to lose out on economies of scale, specialisation, orders, customers and profits.
Yet again, dwell on the over staffing decadence. Now it’s the turn of the management to be overburdened, only the work overload is replaced by staggering costs of recruiting, training and compensating the excess staff. As such, the needless and wasteful expenses reduce the competitive efficiency of the business.
Juxtapose these scenarios with an adequately manned organisation that vivaciously pulsates with high morale, enthusiasm, cost efficiencies and accomplished goals. The difference is crystal clear!The staffing challenge
A renowned HR consultant states, “The ultimate aim of human resource management is to ensure that at all times the business is correctly staffed by the right number of people with the skills relevant to the business needs, that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work grade”. However, HR managers cannot increase or decrease staff size based on mere whims or assumptions. A systematic approach is needed to calculate staffing requirements and match the staff pool to the needs of the organisation. Here’s how to determine an appropriate staffing model:
• Compare – Draw on industry-specific standards by professional publications or staffing surveys of prominent companies. Indexed by functional categories, company size, etc., these studies can serve as a rudimentary yardstick for best staffing levels.
• Counsel – Else, seek assistance from knowledge consultants or staffing professionals. They will make recommendations on ways to optimise staffing by analysing the organisational chart, structure and goals. Even sophisticated software tests and tools to create staffing schedules are available, though they can be quite expensive.
• Customise - When it comes to staffing, there is no ‘one size fits all’. Therefore, internal staff surveys should augment benchmark information and opinions. Ask employees how they feel about the workload – is it sufficiently challenging, do they have enough to do, are they overworked, can they work the same with lesser people and so on. Also, managers should detect whether employees seem dissatisfied, are overly busy or idle away due to lack of work.
• Analyse – Conduct a quantitative and qualitative head count of the existing workforce number, gender, age, skills, experience, capabilities, efficiency and future potential. Take into account the company size, mission, objectives, values, culture, functions, services offered, complexity, extent of automation, degree of integration, employee morale and other relevant factors too.
• Investigate – Supplement the data with the quality of output, level of performance, degree of errors, timely results and determine full-time equivalents (FTEs measure worker productivity). Also, comparing the actual workload volume vis-a-vis the time taken will highlight staff excesses or shortages.
• Measure – Some academics propound staffing ratios with certain business metrics to develop an appropriate staffing model. This requires fixing a reasonable range for the ratios of employees to managers, customers, product orders, inventory levels, production costs, gross revenues, etc. For instance, columnist Jim Witschger recommends 10 employees to every 1 manager and 100 employees to every 1 HR executive as acceptable ratios for effective staff management.
• On your own – “Right sizing is the systematic process of reviewing employee numbers, tasks and work processes to determine the appropriate number and mix of staff needed to meet goals”. (Rightsizing: Appropriate Staffing for Your Medical Practice) But, ultimately there is no magic formula to calculate a precise number of employees needed. Comparing and contrasting the above results will yield an approximate staffing level required for business success.
If the actual workforce aggregate varies from this level, ‘right-size’ the organisation by either creating new positions or eliminating old jobs. However, if the work volume pattern fluctuates indiscriminately, use flexible staffing (temporary employees or interns) to absorb the variances without incurring permanent salary burdens. Even outsourcing routine or technical work can help ride out the inconsistency.Again, constant changes in business environment and technology can destabilise the ascertained staffing model. Therefore, workforce planning calls for periodic staffing projections to assess future needs too. Try to forecast future staffing demand and supply based on anticipated sales, production, skill-mix changes, training, retirements, attrition, and transfers and take appropriate steps to bring them into equilibrium.
All said and done, operating with less staff does not create cost-efficiency, nor does being staff-heavy promise better performance. Adequate staffing is the key to true organisational success.
Hang on a minute before flippantly dismissing this as yet another superfluous management funda!
It is critically important to get staffing levels right as too large or too small a workforce negatively impacts an organisation’s mainstay – its ability to do business and attain its goals and objectives. Even international surveys bear out a direct correlation between organisational profitability and right-sized staffing. General Motors’ Chet Watson also reiterates, “In order to deliver the types of services that our customers expect of us, we need the right staff size, the right people and the right skill sets”.
Therefore, think again. Couldn’t the palpable turmoil buffeting your organisation be linked to an inappropriate staffing level? After all, apathetically carrying on with either an overabundant or insufficient labour force has devastating effects on employee productivity, motivation, commitment, stability as well as sustainability.
But if you aren’t convinced yet, try to envisage the knock-on effect of a short-staffed department. The continual overload of being several people down augurs a classic case of employee overwork. The constant overburden and exhaustion not only diminishes efficiency, but also causes the organisation to lose out on economies of scale, specialisation, orders, customers and profits.
Yet again, dwell on the over staffing decadence. Now it’s the turn of the management to be overburdened, only the work overload is replaced by staggering costs of recruiting, training and compensating the excess staff. As such, the needless and wasteful expenses reduce the competitive efficiency of the business.
Juxtapose these scenarios with an adequately manned organisation that vivaciously pulsates with high morale, enthusiasm, cost efficiencies and accomplished goals. The difference is crystal clear!The staffing challenge
A renowned HR consultant states, “The ultimate aim of human resource management is to ensure that at all times the business is correctly staffed by the right number of people with the skills relevant to the business needs, that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work grade”. However, HR managers cannot increase or decrease staff size based on mere whims or assumptions. A systematic approach is needed to calculate staffing requirements and match the staff pool to the needs of the organisation. Here’s how to determine an appropriate staffing model:
• Compare – Draw on industry-specific standards by professional publications or staffing surveys of prominent companies. Indexed by functional categories, company size, etc., these studies can serve as a rudimentary yardstick for best staffing levels.
• Counsel – Else, seek assistance from knowledge consultants or staffing professionals. They will make recommendations on ways to optimise staffing by analysing the organisational chart, structure and goals. Even sophisticated software tests and tools to create staffing schedules are available, though they can be quite expensive.
• Customise - When it comes to staffing, there is no ‘one size fits all’. Therefore, internal staff surveys should augment benchmark information and opinions. Ask employees how they feel about the workload – is it sufficiently challenging, do they have enough to do, are they overworked, can they work the same with lesser people and so on. Also, managers should detect whether employees seem dissatisfied, are overly busy or idle away due to lack of work.
• Analyse – Conduct a quantitative and qualitative head count of the existing workforce number, gender, age, skills, experience, capabilities, efficiency and future potential. Take into account the company size, mission, objectives, values, culture, functions, services offered, complexity, extent of automation, degree of integration, employee morale and other relevant factors too.
• Investigate – Supplement the data with the quality of output, level of performance, degree of errors, timely results and determine full-time equivalents (FTEs measure worker productivity). Also, comparing the actual workload volume vis-a-vis the time taken will highlight staff excesses or shortages.
• Measure – Some academics propound staffing ratios with certain business metrics to develop an appropriate staffing model. This requires fixing a reasonable range for the ratios of employees to managers, customers, product orders, inventory levels, production costs, gross revenues, etc. For instance, columnist Jim Witschger recommends 10 employees to every 1 manager and 100 employees to every 1 HR executive as acceptable ratios for effective staff management.
• On your own – “Right sizing is the systematic process of reviewing employee numbers, tasks and work processes to determine the appropriate number and mix of staff needed to meet goals”. (Rightsizing: Appropriate Staffing for Your Medical Practice) But, ultimately there is no magic formula to calculate a precise number of employees needed. Comparing and contrasting the above results will yield an approximate staffing level required for business success.
If the actual workforce aggregate varies from this level, ‘right-size’ the organisation by either creating new positions or eliminating old jobs. However, if the work volume pattern fluctuates indiscriminately, use flexible staffing (temporary employees or interns) to absorb the variances without incurring permanent salary burdens. Even outsourcing routine or technical work can help ride out the inconsistency.Again, constant changes in business environment and technology can destabilise the ascertained staffing model. Therefore, workforce planning calls for periodic staffing projections to assess future needs too. Try to forecast future staffing demand and supply based on anticipated sales, production, skill-mix changes, training, retirements, attrition, and transfers and take appropriate steps to bring them into equilibrium.
All said and done, operating with less staff does not create cost-efficiency, nor does being staff-heavy promise better performance. Adequate staffing is the key to true organisational success.
PAYAL CHANANIA
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