HS: What is Optimal Labor?

Overview

Optimal Labor helps managers evaluate staffing needs by comparing labor requirements against actual business activity rather than forecasted projections.

This information is available to customers using the HotSchedules Labor Optimization add-on feature (formerly Activity Based Forecasting).

HotSchedules uses forecast projections, labor rules, and shift restrictions to determine recommended staffing levels. These same settings are used to calculate Optimal Labor, with one key difference: Optimal Labor uses actual business data instead of forecasted data.

How Labor Optimization Works

Labor Optimization uses the following information to calculate staffing recommendations:

1. Forecast Projections: Generated through Fourth's AI Forecasting solution or by managers using the Forecasting tab in HotSchedules. When managers generate forecasts, they select historical weeks, and HotSchedules uses the sales and labor drivers from those weeks, such as guest counts or table counts, to calculate projections.

2. Labor Rules: Configured and managed by authorized administrators in the Above Store Console (ASC). These rules determine staffing requirements based on business activity. For example, a rule may require one server for every four projected tables.

3. Shift Restrictions: Settings such as minimum and maximum shift lengths are applied alongside labor rules to generate Forecasted Labor. These recommendations appear as house shifts or recommended hours and are designed to support realistic scheduling.

Understanding Forecasted Labor vs. Optimal Labor

Both calculations use the organization's configured labor rules and shift restrictions. The difference is the data used to determine staffing needs.

For example, a forecast may project a certain number of guests for a shift, resulting in a recommended staffing level. If the actual guest count differs from the projection, Optimal Labor calculates the staffing that would have been recommended using the actual activity.

This helps managers understand how staffing recommendations compare with actual business demand.

When Optimal Labor Is Available

Optimal Labor calculations depend on actual sales and labor-driver data received from the previous day.

Because these calculations use actual business activity, Optimal Labor cannot be calculated for future dates.

Once the applicable actual data is available, HotSchedules can calculate Optimal Labor using the configured labor rules and shift restrictions.