Understaffing could undercut your profits.

By Steve Moran

This is part 4 in a 5-part series about how to create culture where every team member loves coming to work each day:

Introduction:  4 Keys to Having Employees Who Love to Come to Work Every Day

1st Key:   Why Trying to Meet Every Need Every Time is a Senseless Idea

2nd Key:   Standardize and Empower

3rd Key:   Cross Train

The fourth key is to:

Build Slack into Your Schedule

The Proposition

Here is the proposition, you should build slack into every day’s schedule. What these good jobs companies do is completely counterintuitive to making big profits . . . and yet by routinely overstaffing (as in over-staff every single day) these companies are making great profits. The reason this works well is because you have already done all this cross training. Now look what happens . . .

  • If someone is no show, you have an extra team member to fill in.

  • Team members no longer feel overworked and taken advantage of.

  • Residents feel well served.

  • If you are overstaffed that underutilized person can work on those long term projects that never have the resources you need to make  them happen.  

The Extra Cost

It turns out the extra cost is likely no extra cost at all, for these reasons:

  • Some percentage of the time, this extra person will mean you are right staffed instead of understaffed . . . a budget neutral condition.

  • It will reduce the amount of overtime you have to pay when someone doesn’t show and you have to ask someone to double up.

  • Your team will all work happier, which means working harder and lower turnover.

  • Your residents will feel better taken care of, though, they may not know why.

  • Because your residents are feeling exceptionally good about their experience they will be a big help in recruiting new residents. This will mean higher occupancy. Just one extra resident should be enough to cover the cost, plus some.

The final piece of the puzzle is that at least in these good job retailers, they are not only able to make great profits they are actually able to pay their team members above average wages.