What is Workforce Optimization? Examples, Benefits & Strategies

You are here:
What is Workforce Optimization? Examples, Benefits & Strategies

The term “work smarter, not harder” captures the essence of workforce optimization. As we move into an era where the expectations of customer satisfaction, service delivery, and excellence rise, how does the workforce respond to this need? You can’t always hire more employees because this would only increase your operational costs. In fact, what you should be looking for is always to increase productivity with the same workforce. That’s where workforce optimization comes in.

As remote and hybrid working is becoming more common, organizations are facing challenges to decide on the best operating model and system to optimize productivity while reducing burnout. Workforce optimization helps organizations not only operate efficiently but also to provide excellent customer service. Let’s look at workforce optimization definition, examples, benefits, software, and strategies.

What is workforce optimization?
Workforce optimization examples
Benefits of workforce optimization
What is workforce optimization software?
Workforce optimization strategies

What is workforce optimization?

Workforce optimization (WFO) is a set of strategies and practices that aim to improve employee and organizational efficiency and decrease operational costs through using data. The overall goal is to achieve organizational success. WFO touches every aspect of the organization, from marketing to finance. The objective is to streamline the processes between every department and employee to maximize results. For example, in Formula One (F1), all teams have pretty much the same setup and cars. The teams that usually come on top are the ones that are able to optimize all the teams, cars, drivers, mechanics, engineers, and departments to win.

When fully implemented, WFO reduces costs, improves operational efficiency, increases productivity, maximizes technology investments, improves customer services, enables process automation, reduces error, and provides deep dive insights into every aspect of an organization.

Contact or call centers and retail, but also the manufacturing logistics sector, extensively use WFO. However, it has also gained popularity and usefulness in other industries and across all roles, irrespective of the type of work.

Related (free) resource ahead! Continue reading below ↓

People Analytics Resource Library

Download our list of key HR Analytics resources (90+) that will help you improve your expertise and initiatives. Your one-stop-shop for People Analytics!

Data analysis is a critical component of WFO, and some of the data collected include: 

  • Net promoter score (NPS)
  • Operational costs
  • Customer satisfaction scores
  • Employee performance data
  • Employee work schedules.

These are massive scores of data collected and analyzed, which is why technology plays a crucial role in workforce optimization. Technology and WFO software combine analytics, quality management, call recording, coaching, speech analytics, text analytics, surveying, and feedback to optimize workforce processes.

Workforce Optimization

Workforce optimization examples

Some examples of what WFO typically looks like in practice include: 


This is software that tracks attendance, performance data, and other metrics to put together an employee schedule. Not only are you able to manage overtime and burnout, but you also analyze if you need to actually hire additional staff. This is closely linked to temp workers as well, as the workflow can determine workload.

For example, during peak periods such as Christmas, when sales are high, you may need to deploy a new workforce system, hire temp staff or hire new employees, depending on various factors. This is an area of concern for many supply chain, warehouse, and retail organizations.

A UK-based bookseller called the “Book People” used WFO to manage their workforce, which included forecasting, daily management, scheduling, holiday processing, and real-time reporting. It resulted in 5% increase in customer service levels.

Time tracking

Time tracking or attendance software allows you to understand what’s going on at all times. It answers questions such as whether employees are checking in late or early. Or whether there are ‘false clock-ins’ – employees clocking in for their friends. But it is not a punitive measure. Rather, it allows an organization to look at scheduling and ensure they are covered for all times, across all geographies, business hours, peak hours, and public holidays/weekends.

As an example, Ingenico used WFO to reduce overtime costs by 25% and reduce time spent on resourcing by 87% while maintaining the same service levels. 

Performance management

WFO is often also used for performance management to optimize employee performance and ensure they are best positioned to perform well at their jobs. Using a task tracking platform such as Asana and Trello is often a valuable tool when tracking and aiding performance. These tools allow employees to shift through the ‘noise’ and work on what is an important and high priority. On an individual level, it helps manage tasks. Organizationally, it helps shift work in the right and most optimal direction.

Benefits of workforce optimization

  • Increased efficiency and productivity – The right number of employees at all times. Organizations are able to have a complete picture of employee attendance and overall time. Thus, they can manage customer demands effectively. During peak seasons, WFO enables organizations to understand if they need to hire temp staff or introduce technology that could help them deal with the new work demand, for example.
  • Lower costs and increased savings – You can avoid overstaffing but also understaffing where you would lose money on bad customer service. Not only does it lower costs, but it also creates opportunities for cross-selling and up-selling. WFO that introduces automation into the business provides real-time guidance and actionable insights for revenue opportunities.
  • Improved customer service and retention – Customers get help, and their queries are resolved quickly and efficiently. That makes for a good customer experience. WFO helps you analyze communication with customers, understand the root causes of customer behavior, and implement strategies to retain customers. WFO software allows organizations to gain deeper insights into their customer’s habits and their ability to service their needs. It enables an organization to respond to customer complaints faster, act faster and thus improve customer satisfaction. A happy customer is most likely a returning customer.
  • New opportunities – WFO creates internal career movement as new opportunities and products are developed. It allows employees to perform at their optimal level, therefore increasing the likelihood of vertical or horizontal movement within the organization. As employee satisfaction increases, so does customer satisfaction. 

What is workforce optimization software?

Larger organizations would benefit from workforce optimization software because trying to do analysis and improvements manually would prove to be an impossible task. WFO software is a solution that enables a number of aspects related to workplace productivity to be optimized. As an example, it is able to analyze business requirements with the number of employees, peak periods, availability, budget, skills, labor law, and contractual agreements. From this, it can analyze, schedule, forecast, and optimize the workforce. 

There are plenty of WFO software providers. They should importantly:

  • Have a good user interface – It needs to be intuitive software, as real-time decisions are made, and a complicated interface would only complicate decisions. It should be aesthetically pleasing, modern, and include real-time updates. 
  • Scalable – It is essential the workforce optimization solution can be scaled across the organization, in different departments, and types of work.
  • Integrations – This is probably the most important aspect. It should speak to the internal systems an organization uses and should integrate with popular HR apps as well (e.g., SAP, Sage, BambooHR, etc.). 
  • Value – WFO software tends to be expensive, so when deciding on one, ensure that it has all the controls you need, as well as additional perks (e.g., good customer services, a mobile app, new version releases).

Some examples of WFO software include Kronos Workforce management, SAP Workforce Management, Monet Live WFO, When I work, BambooHR, Oracle Workforce Management – but there are thousands on the market.

Workforce optimization strategies

To effectively implement workforce optimization in the workplace, you need to invest in your employees and technology. Let’s take a look at some strategies and best practices for workforce optimization:

Adopt a customer-centric perspective

The goal of workforce optimization is to provide the best customer service in the most efficient way. While having fewer employees on a shift means you have to pay them less money, it could also mean your customer service suffers. So always ask yourself – How does this impact my customers? Also, consider what external data is indicating.

Map out your
Path to HR Leadership

Try our need tool to determine the direction in which you want to progress based on your HR career goals and capabilities.

Get Started

A study by Gartner indicated that there would be a 41% drop in phone-based customer interactions. Given this, other mediums such as instant messaging and web chat are likely to increase – a firm indication that this is where an organization should likely move towards.

Provide employees with the tools and resources they need to succeed

That way, you’re empowering the workers to do their job effectively and efficiently. Think knowledge banks, gamification tools, etc. For instance, if an organization expects an increase in customer instant messaging queries, they should provide training to enable customer service agents to gain skills at this. Or, if you’re deploying a new product to the market, provide the necessary skills to sell, up-sell, and identify additional revenue opportunities.

Match skills to jobs and tasks

Employees with certain skills will be better at some tasks than other employees. That’s why you need to have a good overview of both skills that your employees have (using tools like skills inventory and skills taxonomy) and tasks that need to be carried out and what they require.

When your workers get to utilize their skills, it also increases employee engagement.

Use a scheduling tool

To avoid inefficiencies, overtime costs, and burnout. Organizations are able to manage customer demand with employee time. Some popular scheduling tools include Monday.com, and Wrike. 

Set realistic goals

WFO allows the extraction of insights and data, thus establishing performance goals and standards. Based on this, organizations should set reasonable expectations for employees. For example, if in a contact center, analysis indicates that, on average, seven customer calls can be handled per hour – then that should be the expected standard. You should also consider other factors, however, such as dealing with a difficult customer, lunch breaks, a number of employees working – and therefore, the approach should always be agile. 

Be agile

A lot of organizations produce annual schedules in advance. However, this can often mislook unexpected occurrences or events (e.g., the COVID-19 pandemic). Therefore, while it is good to have an annual oversight, always be agile and plan in short bursts to maximize the chance of an accurate schedule. This level of flexibility also makes effective use of the real-time data produced by WFO.


Always review your WFO practices and strategies. Products and customer needs change often, and therefore an organization’s responses to them should as well. A monthly, quarterly, and annual review will ensure that an organization is at the forefront of what is going on with their customer base and if the workforce is optimized to serve those needs. 

Have a training and development plan in place

No WFO will be complete without a comprehensive training strategy. Inevitably, there will be skills gaps that you need to bridge. The one option is to hire to fill those gaps (which is a very costly solution). The other is to train employees on those missing skills. The goal is to allow employees to do more, with less – and training on new tools and ways of work leads to this.

A final word

If implemented properly, workforce optimization can have immense benefits for different types of businesses. Utilizing technology to optimize your workforce is key to success. WFO does not happen overnight. It is a gradual process, with iterations and improvements over time as you deploy new systems and technologies.

Subscribe to our weekly newsletter to stay up-to-date with the latest HR news, trends, and resources.

Are you ready for the future of HR?

Learn modern and relevant HR skills, online

Browse courses Enroll now