Right-size with a Department Staffing Analysis

A question we often hear is: “How do we determine the appropriate staffing level in our Accounting Department”?  A helpful tool to facilitate this evaluation is a Department Staffing Analysis.

In the example below we take a look at an accounting department that needs to add staff, but this tool can also be used throughout the company and can be very helpful in situations where the goal is to reduce hours due to downsizing or a lean initiative.

To create a Department Staffing Analysis, list all the tasks done in the department and estimate the time required for each task, by person.

Getting credible information is the difficult part. It is helpful for people to maintain a daily diary or time sheet to help determine where they are spending their time. It also requires a healthy dose of discussion and input from the supervisor.

Employees often fudge on the time because they anticipate what the manager wants to see. You need to reassure them what the goal is. Emphasize that accurate information is important and that their job is not in jeopardy.

To get started:

• Set up an electronic (Excel) spreadsheet.
• List the tasks in the first column.
• Have a separate column for each employee.
• Have 3 sections of columns, one for current, one for changes and one for the resulting staffing level.

This would be a good time to retrieve the sample. Click here for a sample Department Staffing Analysis and follow along.

We have found it is easier if you break down the tasks into broad categories. This may vary depending on your unique circumstances but a simple scenario would be:

• Daily
• Weekly
• By-weekly
• Monthly

The Situation at Sample Company:

•  CFO already has too much on her plate and does not have the time for key strategic initiatives.
• Accounting Manager is capable and would be able to take on additional responsibilities but is already working considerable overtime.
• Clerk 1 is currently working about 1.5 hours of overtime per day.
• Clerk 2 is borrowed from another department approximately 16 hours per week and they need him back.

Goal:

• Redistribute the work load.
• Reduce Overtime.
• Free up the CFO and Accounting Manager for more value-adding tasks.
• New hires should be part-time to avoid the additional benefit costs.
• Provide flexibility to deal with vacations, peak demands, etc.

Result:

• Using the Department Staffing Analysis, work was redistributed creating 2 new positions of 24 hours per week.
• These positions picked up work from the Accounting Manager freeing her up to take on work previously done by the CFO.
• The 2 new staff also picked up work from Clerk 1 reducing his overtime.
• This redistribution freed up Clerk 2 allowing him to return to his home department.

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A word of caution, as mentioned earlier, the hardest part of this analysis is getting credible time estimates of what is currently happening. This will need to be reviewed and edited. Seldom is the first pass anywhere close to reality.