a str ategy paper from TIME TO MANAGE: INNOVATIVE WORKFORCE STRATEGIES
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1 a str ategy paper from TIME TO MANAGE: INNOVATIVE WORKFORCE STRATEGIES FOR a tough ECONOMY
2 a tough economy Across the nation, state and local budgets are reeling from a financial meltdown that has an impact on all aspects of the American economy. State and local governments are battling budget deficits that total an estimated $132 billion nationwide and are facing increased pressures to reduce the public workforce, eliminate non-priority programs and adopt strategies that make government more efficient in its delivery of services. While the exploration of more efficient government is a journey with a long history, the realities of the current economy have reinvigorated the discussion and placed increasing demands on public managers at the state and local governmental level, including universities and public schools, to deploy new solutions to make government more cost effective, accountable and productive. Private K-12 schools, colleges and universities also must become more efficient, because, while they are not at the receiving end of cuts forced by reduced state budgets, a down economy can severely affect the amount and frequency of private funds that are their livelihood. Severe economic constriction has hit individual family budgets at the same time it has challenged the financial integrity of private sector corporate bottom lines. Public managers are evaluating current programs and workforce needs in governmental budgets to determine the programs and workforce levels that will survive this economy. State governments are trying to take steps to avoid eviscerating important programs and drastic staff reductions, but such steps are likely to have the effect of imposing even greater financial challenges on local government institutions. Traditionally positioned at the end of this long and strained economic food chain, school districts and higher educational institutions are also struggling to preserve core programs and maintain workforce in a down economy. Stimulus to the Rescue? The federal economic stimulus bill approved by Congress in February 2009 provides $787 billion devoted to key areas of the economy, including education, where $106 billion will be made available over the course of the next two years for public schools, universities and child care centers. The funds are intended to help mitigate the impact of cutbacks, reduce the necessity for layoffs and provide additional financing for special education and low-income children. The states will also receive funding from an additional pool of $11 billion to be used for creating tax credit bonds to help finance the modernization of public education facilities at K-12 schools and public universities. In addition to these funding priorities, the bill makes $5 billion available in state incentive grants that are to be used to support school improvement goals, such as the more equitable allocation of experienced teachers within school districts to ensure that less experienced teachers are not disproportionally assigned to poorer performing schools. The stimulus plan will provide a much-needed boost to struggling schools, but its full impact is still unknown, and innovative institutions have already started to adopt strategies to deal with budgetary constraints and an unpredictable financial future. During such turbulent times when institutions are compelled to take stock and re-evaluate their entire operations the most forward-thinking organizations can adopt new strategies to not simply survive, but thrive. Successful strategies include both those that are time tested and that seek to maximize efficiencies During such turbulent times when institutions are compelled to take stock and re-evaluate their entire operations the most forward-thinking organizations can adopt new strategies to not simply survive, but thrive.
3 and protect core programs, as well as those that utilize new technologies to help better manage the workforce to ensure the most efficient deployment of valued staff. This focus on workforce is important, since labor costs constitute such a significant portion of public operating budgets expenses that are often discretionary in nature and can be significantly reduced. Organizations can achieve expenditure reductions by employing better management policies assisted by technology-based tools that can help managers ensure better accountability for public dollars. These are difficult times for public managers and policymakers with incredible pressures exerted on government to perform more efficiently with fewer public dollars and, in many cases, fewer public workers. Nowhere is this dynamic more in play than in the public education system at the K-12 and university level. Private institutions are not immune from a tough economy; they face fewer endowments and tuition struggles that can result in layoffs. With so much at stake, educational institutions are searching for management solutions to help balance performance requirements, faculty and administration concerns, parental expectations and political dynamics at the same time they work to keep their budgets in check and ensure student success. It Can Seem a Daunting Challenge Although the problems facing educational institutions even during prosperous financial times can seem daunting, there are tools and solutions available to help administrators manage during even the most difficult downturns. While many of these basic solutions are well known to experienced administrators An important component of a successful response to the challenge of meeting demands in a declining economy is a solution that provides a platform for more effective workforce management. and budget planners, innovative and emerging technologies have added a new dimension that provides enhanced tools to assist educational administrators at all levels in better managing the workforce. In the most effective solution deployments, the use of technology doesn t replace existing workforce management structures, but rather establishes a platform for improvement and efficiency that provides a shared exchange of benefit for both management and the workforce. Technology does not manage the workforce for managers, but it can, when properly implemented, provide a solid foundation for better management. Technology solutions often a substantial expense within an organization s budget can assist managers in deploying The innovative workforce strategies adopted to meet the demands of an economy in crisis can actually help educational institutions thrive once the economy recovers. the workforce more effectively to control costs and enhance accountability, while allowing workers to engage in the human resources process by providing access to accrual balances, work schedules, earnings data and important timecard information. Such access provides a self-service capability for workers that helps maximize their production time and relieve management of many of the day-to-day requests they might receive from employees regarding these issues. The solution, when properly deployed, can also help to ensure that employers minimize compliance risks by reconciling automated timecard records with state and federal labor law requirements as well as applicable union contract agreements. Technology investments made to help managers identify efficiencies, maximize productivity and control costs are not investments to preserve status quo, but rather, to better position the organization for the future. The challenge is not merely the standard question of how does one do more with less, but how does one continue essential core mission programs and maintain needed workforce levels when the existing funding streams do not provide sufficient support to continue even at reduced levels of service? The answer, or at least an important component of a successful response to the challenge, is the development of an
4 automated time and attendance system that provides a platform for more effective workforce management. This platform for change solution provides results by integrating and centralizing workforce policies developed to more efficiently and productively deploy staff with the time and attendance requirements of collective bargaining agreements, wage and overtime provisions, and compliance with state and federal laws such as the Fair Labor Standards Act (FLSA) and the federal Family and Medical Leave Act (FMLA). Automated systems can reduce transactional costs by eliminating the potential for manual errors that can often result in overpayments ranging from 0.5 percent to 2 percent of payroll. An automated system can also identify and reduce fraud by preventing employees from entering inaccurate data into the system or falsifying timecards. Using pre-configured templates and tools that incorporate best practices, automated systems can be managed and easily changed or localized to match work rules of the specific employer or location all at once, or one at a time. The employment of biometric solutions like fingerprinting can virtually eliminate the potential for so-called buddy-punching, where fellow employees cover for their colleagues by submitting timecards or punching in and out on their behalf. An automated system also eliminates the labor-intensive need for administrative staff to manage the paper flow associated with entering and checking data, correcting the errors and producing reports and audits. Beyond reducing errors and increasing accountability, the capabilities of such a system also provides managers with the ability to better allocate workforce schedules among employees and, where permissible, shift employees either within or between departments and locations to satisfy employer needs while minimizing overtime and other labor expenses. In some cases, the combination of reduced labor expenses, reduced overtime and supplemental pay can produce savings of 1 percent to 5 percent of overall payroll expense. Achieving this goal does not have to be overwhelming; the implementation of new workforce management strategies does not have to be hard. Labor costs can be controlled once workforce management business processes are made part of an automated solution. There are best practice examples from across the country that can serve as a guide and that prove cost-effective, technology-based workforce strategies can, with proper planning, be easily and seamlessly deployed to produce quantifiable results for managing the workforce during good times and bad. Innovative Approaches for Better Workforce Management Chicago Public Schools Experience Chicago Public Schools is one of the nation s largest school districts and is the second largest employer in Illinois. The school system operates 602 schools with 50,000 employees and 10,000 contractors and serves nearly 440,000 students. The district initially sought to develop a system to automate employee time and attendance issues. The old manual system was time intensive and prone to human error with accrual accuracy comprised of paper-based timesheets, courier transfers and redundant data entry. Also, managers had no way of comparing the actual work hours logged against the labor that was budgeted for a particular task. This was particularly problematic with regard to grants, where information lags sometimes resulted in funding shortfalls when labor time exceeded available grant dollars. The implementation of a new automated system produced immediate benefits in both time and money the district was able to save more than $15 million as a result of improvements in managing its workforce. The benefits of the new system produced such dramatic results that Chicago Public Schools soon upgraded, placing the time and attendance records for all 50,000 employees on a single Web-based data system. The move helped to achieve enterprise efficiencies by reducing the time spent on system maintenance, system back-up and the advantages derived from having the workforce information instantly available on a single centralized platform. In addition to the benefits to managers who can now view the workforce from a system-wide perspective the solution also provides benefits to the workforce because it allows employees self-service access to their time and attendance records in real time, whenever they desire, without making formal requests
5 of human resources or their supervisor. As a result, the selfservice access component has increased both efficiency and productivity and empowered employees with information that previously was not immediately available to them. This same real-time information also provides management with an important tool for allocating work and securing an understanding of how assigned work tasks are balancing against available state funding grants. The new analytics solutions used by Chicago Public Schools gives managers information on realtime labor hours worked by position that can be quickly compared to the monies budgeted for the task. The software even sends out alerts via to let schools know when certain thresholds are triggered. It has been estimated that systems for tracking work against funds has saved school districts as much as 2 percent of the overall value of the grant each year the system has been in place. Chicago Public Schools is exploring the use of biometric terminals to further improve their time and attendance system. The terminals would be used for employees who work off hours or at locations where on-site supervision is not always present and would use fingerprint technology to verify an employee s identity as he or she submits time and labor data. Monmouth University (West Long Branch, New Jersey) labor-intensive tasks, improve access to employee data, track accruals and leave, and ensure compliance with union contracts and labor laws. Within a year of implementing the automated system, Monmouth experienced a number of improvements in workforce management. Timekeeping was organized by four key sectors: administrators, staff, police and facilities management. The system helped Monmouth to better enforce policies on time and attendance, overtime and leave for each group. Because the administrative burden was eased through the automation, employees were charged with the responsibility to self-serve their own time reports and managers were free to spend work hours on more important strategic initiatives and planning. Monmouth dramatically reduced the time spent on the manual revision to timecards, paychecks and other paper-based processes. In addition, because the university employs staff under the umbrella of six different union contracts, the new automated approach made tracking the various pay rules and contract provisions easy. One employee, who was responsible for manually entering the workforce data into the old system, said the new system has cut down manual entries by 75 percent. The University of North Carolina at Chapel Hill Monmouth University is a private university with approximately 6,000 undergraduate and graduate students and more than 1,300 employees. For 20 years, Monmouth used paper timesheets to prepare payroll and coordinate leave for hourly employees. Accruals were also tracked manually by a single staffer in what was described as a monumental task. Antiquated processes such as this encouraged the university to explore other options and to invest in an automated solution to eliminate many The University of North Carolina at Chapel Hill (UNC) implemented an automated time and attendance system in January 2007 to place 18,000 university employees on a single centralized platform for time and attendance and to support efficiency and environmental goals by eliminating the 7,000 pieces of paper previously generated during each two-week payroll interval. The school had 5,500 student employees who worked multiple jobs on the campus, reporting to multiple managers who had to track their hours.
6 The objective was to centralize disparate systems each separate school or campus within the university had a different system that had been developed independently with sometimes conflicting standards. In the university s automated system, time and attendance data is entered by the employee and locked in as it rolls up through the various levels of administrative review and approval from employee to management to administrators. This allows administrators to more accurately manage time and attendance issues. The project has been successful and UNC said much of that success is due to the planning process anticipating and addressing employee concerns before rolling out the system. In order to provide an identity to the system and move away from the impersonal time and records-keeping moniker, project planners gave the system an identity and humanized the project by calling it TIM (Time Information Management). According to the project leaders, it is partly because of these efforts to give a human identity to the system that the workers became less apprehensive about using the new tool. This strategy, coupled with an emphasis on the tangible benefits of the system, such as real-time access to benefit balances, has demonstrated what the system can do to provide real value to the workforce. The project will ultimately put 18,600 job positions on an automated and centralized platform; it has already incorporated the first 16,000 employee position lines and looks to complete the second phase roll-out by April The flexibility of the university s automated time and attendance solution has allowed for the creation of a data warehouse that serves as a disposable interface between that system and the payroll system so the school can operate efficiently to generate reports and information required by the state. University officials said the work necessary to coordinate the independent departmental approaches, while difficult, will undoubtedly produce many longer term benefits down the road that would not otherwise have been available. If current numbers are an indicator, the leaders are probably right. The new systems have already been estimated to have saved about $400,000 and UNC looks forward to a return on investment (ROI) of about $1.1 million annually. Broward County Public Schools Broward County, Fla. The Broward County Public School system is one of the nation s largest school districts, responsible for the education of 260,000 students at 138 elementary schools, 42 middle schools and 32 high schools. The school system also has three adult education technical centers and 55 charter schools with 34,000 full or parttime employees, approximately 17,000 of whom are teachers. In an effort to reduce costs, school officials decided to evaluate time and attendance workflows for substitute teachers. The school employed 5,000 part-time substitute teachers, with approximately 2,000 working on any given day. Substitute teachers recorded their attendance by writing their hours on a paper time sheet. These paper time sheets were then collected by a school s central office, where the data was tabulated and sent to the school s department headquarters. As Broward County was analyzing this workflow, one of the technical schools under its jurisdiction began exploring the development of an automated time and attendance solution. This inquiry encouraged the county to look at a system-wide approach to time and attendance and in February 2006, Broward County Schools began utilizing computer-linked time clocks to track the time and attendance of all substitute teachers at its schools. The implementation of the system was rolled out to the three technical centers first and the system configured to meet customized school needs after planning sessions with individual school administrators. After the deployment at the technical schools without going live the deployments were completed at 12 more schools. Once these deployments were analyzed to develop a set of best practices, the school district deployed the solution to the remainder of the schools, installing 600 time clocks in 230 schools. The automated system
7 was integrated with the district s automated payroll system in time for the school year and was such a success that the district anticipates extending the system to include bus drivers, custodians and food service workers. Although Broward County is the nation s sixth largest school district, the time and attendance project was completed by only nine staff members five of whom dedicated less than 25 percent of their time to the project. In evaluating the results of the system, school officials calculated a 52 percent ROI with payback estimated in less than two years. The fully deployed system has successfully enabled the district to reduce overpayments to substitute teachers and improve the productivity of administrative staff. Because the attendance of substitute teachers is now confirmed by time clocks rather than paper time sheets, the payroll for substitute teachers has decreased by 4 percent. If workforce costs comprise an average of about 70% of education operating budgets, even minimal percentage reductions in this area can produce significant savings that can be used to preserve core mission programs. Time to Manage The current cycle of economic downturn poses unique challenges to public education administrators at the same time that it offers opportunity. While many institutions are struggling to chart a course through these turbulent times and identify strategies that can help position them to weather the storm, there are many best practice examples that can be reviewed to inspire new thinking about the age-old dynamic of balancing mission against available budget allocations. Considering the depth of the current international financial crisis, the dynamic involves levels of organizational soul searching and innovative thinking of education leaders who still must battle traditional concerns of crumbling school infrastructure, state-mandated performance standards and societal issues within the school environment. In evaluating the current state of educational institutions at both the K-12 as well as the higher education level, the most effective approaches to maximize the impact of declining dollars have been those that seek to gain control over expenditures that are within the discretion of the institution. If workforce costs comprise an average of about 70% of education operating budgets, even minimal percentage reductions in this area can produce significant savings that can be used to preserve core mission programs. Added to the importance of these dollar savings are the efficiencies that can be achieved to enhance productivity by reducing paper-based transactions, eliminate redundant data entry and maximizing staff time. The efficiencies achieved in difficult times and the investment sometimes needed to secure them will continue to provide tangible benefits to organizations long after the economy recovers. Technology can provide a centralized and automated platform and can be a partner in the effort to realign organizations. Technology can offer effective tools that can help education leaders reevaluate how their institutions deliver services and, in turn, how the institutions account for the costs of delivering those critically important services. There is much that can be learned from those who have already implemented cost-saving solutions. In each case study outlined in this paper, forward-thinking administrators faced with budget concerns identified a problem, searched for a solution and worked to deploy a system that would meet their needs. These are difficult times, but crisis provides opportunity, and an empowerment of educational administrators, teachers and support workers. Educational organizations are human institutions charged with one of the most important responsibilities in society. Better workforce management strategies do not have to be difficult or costly to implement. Technology provides the opportunity for organizations to more efficiently work together on integrated strategies that will help to better position institutions to survive in hard times so that they are better able to thrive in the better times that are sure to return.
8 Kronos helps organizations of all sizes unlock opportunities hidden within their workforce processes to control labor costs, minimize compliance risk, and improve workforce productivity. Our easy-to-own time and attendance, scheduling, absence management, HR and payroll, hiring, and labor analytics solutions provide complete automation and high-quality information. The Center for Digital Education, a division of e.republic, Inc., is a leading resource on information technology policy, trends and opportunities in K-12 and higher education. The Center offers a series of unique programs covering the critical policies, executive leadership and applications surrounding education technology. Acknowledgements: Bill Howard is a senior fellow for the Center for Digital Government. He previously served as chief of staff for the New York State Office of Homeland Security. Prior to that appointment he served in high-ranking positions for two New York governors. From 2003 to 2006, he was acting chief of staff for Gov. George E. Pataki e.republic, Inc. All rights reserved. A division of e.republic, Inc 100 Blue Ravine Road, Folsom, CA phone fax
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