Operators manage labor costs with tech tools

Shift managers at Sharon, Pa.-based Quaker Steak & Lube no longer have to worry about handling irritating "Do I work today?" calls from employees. Instead, they send approved schedules to workers via email, text and smartphone push alerts via a POS-based scheduling tool.

“That makes it a great communication tool for our teams,” said Jim McGrath, chief operating officer for the 62-unit casual-dining company. “If employees want to trade shifts or switch their schedules, it only works with management approval. And if changes are made, the system sends them right out.”

POS-based scheduling software goes beyond making scheduling more convenient for restaurant managers, however. Such tools can also benefit the bottom line by using historical sales data to improve predictive scheduling. They also track labor expenses in real time, maximizing managers’ ability to control costs.

McGrath said the software used by Quaker Steak and Lube also does an excellent job of forecasting sales revenue, which helps managers schedule labor accurately for every position and all wage levels. “It allows them to know on a daily basis how they’re tracking according to budget and make adjustments during the week,” he said. “That means no surprises at the end of a week or a period.”

Similarly, fast-casual chain Pancheros recently made a significant investment in POS-based scheduling software in hopes of reducing overtime at its 59 units, according to Barry Nelson, vice president of operations.

Managers are now required to regularly use the tools to forecast labor based on a combination of historical sales, current events and even weather patterns — past and present. “We really want them to spend more time building that schedule correctly from the beginning,” said Nelson. “It makes them more conscious of scheduling on a focused basis instead of letting shifts just happen.”

Convenient above-store access allows district managers to monitor multiple stores regularly — and in real time if necessary — to see how closely actual costs parallel budget targets. “If they get off track, you can react more quickly to what’s happening with information that’s right at your fingertips,” said Nelson, who called real-time access a real plus.

Having an abundance of information generated by the software allows him to coach his managers on the finer points because, in the end, informed human decisions are still the best. “The software makes it easier to manage our managers because you can show them a distinct line of cause and effect immediately," he said. "If business dropped off at 1, but you kept everyone on until 2:30, there’s no denying the impact of that choice.”

In addition to pointing out labor management mistakes, the software also calculates labor savings when the process goes well, Nelson added.

At Quaker Steak & Lube, floor managers must also monitor their POS dashboards for real-time labor data in order to help make staffing decisions, according to McGrath. When the software warns a restaurant’s labor-to-sales percentage is higher than budgeted, managers know it might be time to cut staff.

“That kind of management will always be high-touch and require some gut instinct,” McGrath said. “But [the software] really helps during that 2 p.m. to 5 p.m. timeframe when it’s a big challenge to determine how many people to keep on.”

Even with sophisticated software to help make smart business decisions, service must remain a priority, noted Nelson. “You can cut labor and save, but the question always has to be, ‘Did that effect service negatively?’” he said. “If the answer is yes, then we’ve done the wrong thing. Good service has to come first, and actively managing that labor is something that will never change. Seasoned managers do that best.”