Employee Schedule Change Management

Few things are as important to both casino employees and casino employers as the work schedules in place; therefore, making changes to employee schedules should reflect the interests of the entire organization and should be supported by all levels of leadership. Determining what factors identify the need to change an existing employee work schedule should be carefully considered with the interests of both operations (the work), and employees (the workers), then balanced to be realistic for both. Many Casinos have attempted to adopt a “just in time” strategy for developing employee schedules, creating multiple start times and shifts lengths in an effort to closely match changes in hourly demand, only to discover later that the resulting schedule is difficult to manage operationally and drives dissatisfaction and turnover with their employees. Again, realism is the key and the final test which should be applied before change is implemented.

Strategic operational changes, such as adjustments to hours of operations, the opening of new venues, or the creation of new work assignments will often establish the driver for employee scheduling change. The need for change can also be driven by seasonal demand patterns, the creation or movement of casino marketing or promotions, significant employee turnover, or by a change to the Department or Property organizational structure. For whatever the reason, the need for change should be identified through careful analysis by Operations, Finance, and Human Resources in order to fully understand the risks and rewards associated with changing employee schedules.

Key to the identification of need for change is an understanding of the volume indicators that represent demand for employee services with the use of indicators, both forecasted and actual, and to test the current employee work schedule for validity. Several aspects regarding volume indicators should be kept in mind. First, the indicator must be relevant to the work being performed by the Job Class. Second, the indicator should available from a reliable source, preferably from a system source instead of being manually created. Finally, the indicator should be readily available for all required time periods being forecasted.

One of the common mistakes made by casinos is with their frequent use (and abuse), of actual, system-reported volume data. Yes, actual volume is required to fuel trend forecasting models and to create labor forecasts, but analysts should take care not to perpetuate negative business performance by using actual data from time periods when guest service fell short or when targeted revenues were not realized. Casino Analysts should not indiscriminately feed actual data to their models from time periods representing good business performance as well as bad, instead, a careful review of business performance should be undertaken to insure that volume data used to produce forecasts is an accurate representation of the desired business performance.

Finally, the volume forecast must be translated into the number of employees required with the results being applied to the current employee schedule to see if a change is actually needed. Adjustments to current employee schedules should be resisted unless significant operational and financial outcomes are to be realized as a result of making the change.

Besides, in the Casino and Hospitality business an even bigger need for change may be just around the corner. Don't wear out your employees unnecessarily.

Quality versus Costs

It should come at no surprise that a property which has really good labor margins also usually has really good guest feedback scores. Why? Because more often than not that property’s leadership is focused on using labor resources to provide a quality guest experience instead of simply being focused on reducing labor expenses.

At first this may sound like a paradox, how can a quality focus actually improve labor margins and reduce labor costs? Two ways: first, because if guests appreciate and recognize the quality experience they receive they will return more often and spend more money (higher volumes typically result in better margins), and second (listen closely now, labor managers and labor analysts), the delivery of a quality experience requires a lot more planning and analysis effort than if you simply wanted to cut expenses. To deliver quality you will be forced to adopt a more detailed and disciplined approach to labor management and because of this you will find more opportunities to reduce unnecessary expenses along the way.

Simply put, quality requires discipline and focus, cost cutting, well, that just takes cutting.

Delivering quality takes flawless execution from everyone in the organization and most especially from the labor planning and the labor scheduling aspects – get these parts wrong and no matter how comprehensive and detailed the hiring, training, management, or service initiative are the whole thing will fall flat. Organizations that are relentlessly focused on providing quality do not miss with their allocation of labor resources; they find their costs savings along the way as they eliminate waste and re-focus their staffing to provide the type of experience that brings their guests back.

A wise person once said that if you focus on quality then quality will improve and costs will go down. If you focus on costs then costs will increase and quality will go down. Hands down the best advice I ever got in this industry. As you analyze and plan for labor requirements and how they are to be allocated look first from a quality perspective, if you are successful then very often the costs will take care of themselves.

Using Table Limits to set Blackjack Utilization Targets

One of the questions I get most often from casino analysts is, what is the optimum table utilization (gaming spots being played), on Blackjack in order to achieve maximum profitability and labor efficiency? Note that the two goals can be somewhat opposed to each other, lower targeted utilization yields increased game pace and therefore has the potential for increased hold percentage (higher profit), higher utilization yields greater labor efficiency because there are potentially fewer tables open to satisfy guest demand (better labor margins). So what target utilization number hits the sweet spot?

While one can perform detailed analysis on this question by modeling hands per hour, shuffle time and frequency, number of decks, game rules, as well as other factors to determine the optimum spot utilization for a particular table operation, I usually start with a simpler approach – I use the actual hourly table limits in place by individual tables opened in order to determine how many spots should have been utilized.

Here are the targets I typically use as guidelines to determine optimum Blackjack utilization, note that these work no matter how many total spots are on the layout (five, six, or seven):

$5 dollar limit – 5 spots covered,

$10 dollar limit – 4 spots covered,

$15 dollar limit – 3 spots covered,

$25 dollar limit – 3 spots covered,

Anything over $25 dollars – 2 spots covered.

Obviously one would need to have hourly limit tracking in order to complete this type of analysis, if your Table Games Department has automated table tracking then this statistic should be readily available. If your department is still taking hourly manual counts then adjust your tracking input form to allow for the recording of table limits as well as spot counts. Keep in mind that the strategies discussed here are guidelines, a starting point for more detailed analysis. You may find that the optimum utilization during late night when business is winding down may be slightly lower.

Many well-respected industry table games experts have expanded on the impact of running too high a target utilization on Blackjack and I encourage you to investigate their analysis and recommendations while developing your own property’s strategy. In the meantime, try these simple guidelines as a starting point; you may be surprised at how close they come to optimum.

Desperate Email

Want a sure sign that the General Manager of a Casino or Hotel has lost confidence in the labor plans in place at their property? Look for their desperate email! You know, the one that comes out on the day before a major event, that comes out on the Friday before a federal holiday weekend, that comes out just before a visit from the corporate office – it reads something like this – please watch your labor! Let’s control overtime! Make sure that your Managers look for early out opportunities! Please help me, I’m desperate!

Want to know another sure sign with the sending of desperate email? It means that the General Manager has not taken the time to fully understand and to be an integral part of the labor planning activities at their property. Why? Because if he or she had actually taken the time to understand and to be a part of the plan then either the email would come out all the time (if the plan were under development and needed encouragement), or would never come out at all (because the plan in place is mature, tested, understood, and reliable). Knee-jerk messages are symptomatic of knee-jerk management, and of lazy management to boot.

As a property leader my message to Managers before a big event is to relax! Have fun! You have worked hard to prepare for this, so enjoy the action that being at a busy property brings! Aren’t these the reasons we got into this game in the first place? Don’t we live to see our guests having a great time making memories at our properties while we enjoy our biggest revenue and profit days? We have analyzed our prior performance over similar events and time periods. Weeks in advance we planned out every aspect of the event with our Marketing and Operational Departments. We have forecasted our anticipated volumes and we have scheduled our employees accordingly. In short, we are ready, and the last minute is not the time to second-guess ourselves. Let’s have some fun and watch our Department Teams in action!

If you are a property leader and you find yourself at the keyboard ready to generate some desperate email, ask yourself, why? Why do I lack the confidence that my Managers can plan in advance and that they can execute under pressure? What part of the labor plan needs more attention so I can be more confident of the outcomes? What do I need to do to become more involved in pre and post-forma marketing analysis? What message do I really want to send to my Managers and Supervisors on the eve of a big event or weekend, one of encouragement or one of fear?

Go ahead and start typing, because in the end you either have to get busy or get desperate.

Understanding Minimum Staffing Levels

No question 2009 has been a tough year on the Casino and Hospitality Industries. Low guest counts and reduced revenues have made the past year one of the most challenging for operations. For those of you in labor analysis, however, there has been one bright spot to all of this – there is no better opportunity to truly understand minimum staffing levels than during prolonged periods of low volume.

Okay, let’s get this clear from the beginning – no one likes (or wants), low volume to occur. It is times like these, however, when your organization needs solid analysis on minimum staffing levels more than ever, because your operators are probably experimenting with never-before used strategies to manage their labor margins. Managers can see a new picture of their operation during periods of low volume and are highly motivated to try new strategies for delivering great guest service with less.

I can’t tell you how many times I have been told by operators that the minimum staff required is different from one day of the week to the next. Don’t buy it, a true minimum staff requirement should hold up under all time periods. Volume demand should always carry the staffing requirements up from its base, getting your operators to understand this concept will help you gain acceptance to the overall staffing plan and will help when employee schedules are created using your analytical results as a guideline.

Also remember that the true minimum staffing requirement may be zero, with coverage picked up by another Job Class or by a Manager. Always apply a reality check to your proposed staffing adjustments, my favorite is, can your guests tell that you have made a change? After revising your staff plans has your sequence of service been compromised during low-volume time periods? If so, go back to the drawing board. And don’t experiment on your guests – try out your revised staffing plans with mock openings to truly understand the impact your adjustments will make on service delivery.

Analyzing Scheduled Start Times for Variable Job Classes

Here is a quick tip (and a bit of really good advice), on analyzing the efficiency of individual schedule start times for employees working in 24-hour job classes with variable hourly demand – never start employees during time periods when demand for service is falling.

Before you dismiss this advice as being a bit too simplistic for analysis, take a look at the current start times scheduled for your Table Games Dealers, Slot Attendants, and Casino Cocktail Servers as compared to either forecasted or historical actual hourly volume demand. If you see scheduled starts occurring when demand for service is trending down (say, between midnight and 5:00 AM), then the overall efficiency of the daily schedule is usually reduced. Try adjusting these scheduled start times either forward or back while maintaining your desired minimum and peak staff counts and you may find that you need fewer overall scheduled hours to hit your daily staffing targets.

The Problem with (Actual) Volume Data

One of the common mistakes I encounter while working with Planning and Analysis Departments is with their frequent use (and abuse), of actual, system-reported volume data. Yes, actual volume is required to fuel trend forecasting models and to create labor standard reporting, but analysts should take care not to perpetuate negative business performance by using actual data from time periods when guest service fell short or when targeted revenues were not realized. In many cases I observe analysts indiscriminately feeding actual data to their models from time periods of good business performance as well as bad, the result being inaccurate volume forecasting and reduced operational buy-in of their labor standards.

Take for example the case of a large Hotel Front Desk Operation using actual hourly check-in volumes to drive Guest Service Agent staffing targets – and then using actual volume counts reported during an hour when Agent understaffing resulted in line queue timings which significantly exceeded established service targets. Without adjustment the actual data reported during this hour would potentially drive labor standards which would perpetuate the same inadequate staffing levels that yielded the poor guest service performance in the first place! To make matters worse, if understaffing at a Hotel Front Desk resulted in long wait times in one hour then the opportunity existed to “push” a portion of the actual reported volume to the next hour. A labor model driven by the raw volume occurring each hour would then not only erroneously report the staffing levels as being correct in the first hour, it would also incorrectly report labor requirements during the second hour as well.

The answer, of course, is to refine the information being fed to your labor and forecast models by first analyzing the actual data reported by systems against multiple guest service and financial feedback channels (via direct observation, Supervisor reporting, financial reporting, and available guest feedback mechanisms). Make the appropriate adjustments to the actual volume being fed to your models during time periods when understaffing had a direct negative influence on the amount of reported volumes, I would also suggest that you re-label your volume indicator’s name to include the term ‘Adjusted’ so as not to confuse your report users.

Refining actual data prior to feeding forecasting and labor standard models affords an analyst with the opportunity to include Operations, Finance, and Marketing in the process. Not only will your models potentially yield more accuracy, you may also see the buy-in of your results go through the roof as well!