The real reasons for absenteeism can be difficult for businesses to uncover says Neville Henderson, senior consultant at Pasfield Curran, the consulting arm of Crown Computing, but the cost of remaining in the dark is significant.
Speak to most employers and they will agree that reducing absenteeism is critical to their business. However, this is often easier said than done, and many struggle to implement absence monitoring and management policies successfully.
Absenteeism can cost manufacturing companies dear (see The absentee workforce and manufacturing productivity). Yet, according to the Chartered Institute for Personnel and Development (CIPD)’s 2011 Absence Management Survey, only around one-third (32%) of manufacturing companies monitor the cost of absenteeism, but those who did reported a median cost of £444 per employee per year. Multiply this by the number of employees in even a medium-sized manufacturing company, and it’s easy to mount up costs running into hundreds of thousands of pounds.
The underlying issue is that absence management is something of an ‘ugly baby’ that people are uncomfortable talking about, and that often slips under the management radar. One reason for this is the lack of adequate attendance monitoring systems. However, even if attendance data is being collected, there is often a risk of it simply being swallowed up by a sea of statistics. As the current debates around mining ‘Big Data’ underline, few companies have the tools to analyse and present the myriad data they collect in an accessible, actionable way. Workforce information is no exception.
As a result, not only can absenteeism and its impact on the bottom line go largely undetected, but the underlying causes may be missed, and with that the opportunity to remedy these for the benefit of all parties concerned.
Non-health related absenteeism
While genuine illness is the reason for most missed days at work, the 2011 CIPD survey revealed that non-health related absences were still among the top five causes of absenteeism. Home and family responsibilities figure highly among these, confirming anecdotal evidence that in more conservative companies, unplanned absence is often the only way employees feel they can deal with such matters. Where employers are less focused on the traditional 9-to-5 work day, more flexible options can be made available, offloading not only the individual concerned, but also the team, and the business as a whole.
Stress is also another highly-rated cause of absenteeism, according to the 2011 CIPD survey. In this context, we often find that the occurrence of sickness-related absences and overtime go hand in hand. So, for instance, a company with lots of seasonal demand variation may be ‘breeding’ stress-related absenteeism during peak times, as it has to ask workers to put in a lot of extra hours at short notice.
How an organisation covers absences can also create a dangerous reversal of motivations. If the policy is to ask colleagues to cover for absent workers by putting in overtime, this can inadvertently incentivise absenteeism.
In these scenarios, one person’s absence translates into a bigger pay package for other team members. Clearly, there is going to be little peer pressure on absentees in such circumstances. Where this happens, organisations not only need to revise their procedures for covering absences – for instance by spreading workload across teams or by shifting team members – they also need to implement mechanisms that engender a peer pressure mentality to reduce absenteeism. This can only be achieved by creating a culture that accepts and effectively manages genuine absence and challenges ‘duvet days’.
One of the fundamentals of tackling absenteeism is understanding the true attendance requirements of the business by analysing demand patterns and then scheduling staff working time for when it is actually needed. Flexible working schemes such as annualised hours do exactly that, rather than allowing companies to fall into the old trap of ‘painting the factory’ when demand is low only to then enforce weeks or months of overtime when it peaks.
For example, at a medical products manufacturer with heavily fluctuating demand and overtime patterns, annualised hours were introduced after a thorough analysis of workforce management data.
During times of flat demand, employees now have Fridays off. At peak times, they have to work longer hours all week instead. The company’s workforce IT system enables managers to optimise shifts and keep on top of everyone’s working time. In addition to making a significant impact on the bottom line – thanks to reduced overtime payments and wastage – the company also noted that production staff were happier and more motivated thanks to increased flexibility.
In conclusion, a two-pronged approach is needed to tackle the perennial issue of absenteeism: not only must organisations be open to becoming more flexible in the way they work, they also need to seek to align the interests of employee and employer more strongly. In order for both aspects to work, companies should not shy away from deploying automated systems – and using their capabilities to their full. The benefits to be reaped are not just a ‘big brother’ view of the workforce, but also greater fairness and consideration of the needs of individual workers.
Article published in The Manufacturer June 2012.Download Article