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Blog Banner of Difference Between Workforce Management and Workforce Optimization

Difference Between Workforce Management and Workforce Optimization

In any industry, managing the workforce is a challenge. Suppose your organization is experiencing an above-average attrition rate. In that case, if you are dealing with a disturbed productivity rate or it is challenging to take control of the working conditions, you need to act fast.

To orchestrate resource utilization so that your company reaches its productivity targets without overburdening the workers, you have two use workforce management (WFM) and workforce optimization (WFO).

WFO and WFM are the concepts that use statistical analysis to recommend the most effective mix of resources, including workers, to ensure high productivity and job satisfaction among the workforce. Both terms are often used interchangeably, but there lie subtle differences between the two concepts.

Understanding workforce management vs. workforce optimization differences can help you make the most of the available resources in the long term.

Workforce management, or WFM, is a set of strategies, processes, and tools that the management uses to increase worker productivity. It primarily targets manpower forecasting, scheduling, and shift management through tools to automate the process.

 The main objective of workforce management is to ensure that the organization is adequately staffed. Furthermore, it also provides a contingent workforce available to address the productivity requirements at peak periods.

Workforce management addresses the requirements of shift scheduling and refining the work environment to allow employees to work in a conducive environment. WFM uses tools to help managers create schedules, assign shifts to the workers, create reports, and monitor day-to-day activities within the company.

Truein is a cloud-based hardware-less employee time and attendance management application that offers WFM features like shift schedule creation, attendance tracking, monitoring the location of employees at work, auto-generating reports, overtime management, and more.

What is workforce optimization?

Workforce optimization or WFO refers to the set of processes, strategies, and tools that help individual worker increase their productivity, quality, efficiency, and sustainability in the long term. Simply put, WFO emphasizes talent development and quality assurance at the employee level within the workforce.

As opposed to WFM, which deals with the day-to-day productivity of the entire company, WFO offers high-level insights into overtime, disengagement among workers, stress levels, or too many idle hours within the workforce.

WFO utilizes scheduling tools the same as workforce management, but it also requires monitoring the workers’ quality and performance to provide further training for upskilling.

Workforce Management vs. Workforce Optimization: 4 Key Differences

WFO also includes learning and development as part of the strategy, while WFM does not emphasize learning or development. This can also be highlighted as the key difference of workforce optimization and workforce management.

Only workforce optimization provides real-time skill development tips, recording-based guidance, and other talent development aids for improving the workers at the individual level. WFM works on the scheduling and availability of the workers, while WFO focuses on efficiency gains within the individual workers.

Workforce Management allows companies to standardize service levels and other important KPIs to ensure that all business processes run smoothly and face no workforce shortage. On the other hand, workforce optimization unlocks new efficiencies and opportunities through performance analytics and long-term training of the workers.

Workforce optimization strategies include workforce management features, but not the other way around. WFM is a necessary part of WFO, so at some companies, workforce optimization alone is enough to improve productivity.

However, standalone WFM lacks vital features of WFO, such as performance monitoring, employee engagement, and skill development management. For a small company, workforce management alone would suffice if their requirements were not complex.

However, such essential forecasting and scheduling capabilities must be improved for medium-scale and large organizations. Organizations with large teams must utilize both WFM and WFO to have different strategies for managing quality assurance, performance, and productivity.

3 Benefits of implementing WFM and WFO

At your organization, depending on the size of the workforce, you can choose to implement either workforce management or workforce optimization. WFO implementation probably works best because it also includes WFM features by default.

1. Build a happier and more efficient workforce

With WFO, you can engage employees and help them improve their talent, which results in increased output and higher satisfaction at work. Managed and streamlined workforce is happier and more efficient.

2. Increases your company's agility

With WFM and WFO, you can scale up work depending on the market’s demands. This makes your company more agile, and you can easily meet budget constraints or quickly react to project needs.

3. Cost savings

Proper workforce management and optimization present many cost-saving opportunities. The key benefits include lower payroll costs, flexibility in talent acquisition, and reduced compliance risks.


We hope our workforce management vs. workforce optimization explanation has provided you with enough information to use the terms interchangeably next time. Ultimately, workforce optimization takes how you manage your workforce and optimizes it for maximum performance and skill development while ensuring smooth interaction between the organization and the workforce.

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