Wal-Mart's new scheduling system looks to improve peak-

hour staffing
Business | Thu Aug 4, 2016 8:30pm EDT
CHICAGO | BY NANDITA BOSE

Wal-Mart Stores Inc (WMT.N) has implemented a new system for scheduling
workers at 650 U.S. stores, the company said, as it aims to improve
staffing levels during peak shopping times and offer more certainty over
hours for employees.

The world's largest retailer has acknowledged in the past that customer service
needed to improve as it was hurting sales growth. Wal-Mart is investing $2.7 billion
on pay and benefits and has led major retailers in raising minimum wages to $10
per hour. Wal-Mart's new scheduling system could prompt others to follow.

The system, called Customer First Scheduling, was launched in all of Wal-Mart's 650
small-format Neighborhood Markets in the last week of July with plans to eventually
roll it out across the entire U.S. store network, although the company gave no
timeframe.

"If customers are coming in at a different time we have to be there at a different

time. We will not last very long if we don't do that," Mark Ibbotson, vice president of
central operations, told Reuters.

"At the same time ... associates have the option to choose what hours they want
and see if they are available," he said.

The electronic system can prioritize scheduling for peak shopping hours by taking
into account foot traffic and sales data from every department in each store. Staff
are then allocated to the remaining shifts in order of importance.

Wal-Mart began last year to try and improve customer service with faster
checkouts and better-stocked shelves.

The new system also aims to give employees more certainty over shifts and should
cut down on the need to schedule employees on short notice.

Labor activists, unions and politicians have been pushing retailers, including Wal-
Mart, to offer workers more predictable hours.

The new system allows some workers to have a fixed schedule with the
same hours and days for up to six months. Those with unfixed schedules
will only be slotted to work when they say they are available and will not
be expected to be available on short notice.
Currently, Wal-Mart managers allocate hours within the times employees say they
are available to work.

EARLY PROBLEMS

The new system is ostensibly designed to increase workforce retention, but it was
not immediately clear how it will affect overtime opportunities, an important
component of low-paying retail jobs.

Ibbotson declined to comment on whether the system will affect the availability of
overtime.

Labor groups, which have been calling for change, had mixed reactions to the new
system.

Our Wal-Mart, a labor group that focuses on representing the retailer's employees,
said in a statement that the policy makes some improvements by adding fixed shifts
and prioritizing peak hours. But it said the system does not address the problem of
inadequate hours.

The United Food and Commercial Workers union, which has worked to unionize Wal-
Mart employees but does not count any of the company's employees among its
members, said in a statement it was not clear whether the changes will make a
material difference in the problem of scheduling.

Fears of a cut in overtime pay led to worker protests across three cities in China last
month when Wal-Mart launched a new but different scheduling system there.

Electronic schedules generated by the new U.S. system, which Wal-Mart developed
with workforce software company Red Prairie, have thrown up some early problems.

"Some days it will schedule one person on the entire front end from 7-11 a.m. and
other days it just won't schedule at all until 1 p.m.," said a store worker who spoke
on condition of anonymity.

"I didn't have a single cashier come in one day until mid-morning," the worker said.

Source: Bose, N. (2016, August 4). Retrieved from

http://www.reuters.com/article/us-walmart-labor-exclusive-idUSKCN10F27W
Synthesis:

The article talks about the Wal-Marts new scheduling system that aims to
improve staffing levels during peak shopping times and offer more certainty over
hours for employees. The world's largest retailer has acknowledged in the past that
customer service needed to improve as it was hurting sales growth. As stated in the
article, the new system allows some workers to have a fixed schedule with the same
hours and days for up to six months. Those with unfixed schedules will only be
slotted to work when they say they are available and will not be expected to be
available on short notice.

According to Nahmias and Olsen (2015), aggregate planning, which might

also be called macro planning, addresses the problem of deciding how many
employees the firm should retain and for a manufacturing firm, the quantity and the
mix to be produced. Macro planning is not limited to manufacturing firms. Service
organization must determine employee staffing needs as well.

In this case, I think the new scheduling system at Wal-Mart is a good way of
addressing the employees need of better schedule that will increase the workforce
retention. However, I think they should still improve their strategy since there are
still problems that are not addressed like inadequate hours and how it will affect
overtime opportunities.

Sources:

Nahmias, S., & Olsen, T. (2015). Sales and Operations Planning. Production
and Operations Analysis (7th ed.). Chicago, IL: Waveland Press.

Bose, N. (2016, August 4). Retrieved from http://www.reuters.com/article/us-

walmart-labor-exclusive-idUSKCN10F27W