Among the biggest trends in labor-management systems today is an expansion of the function beyond traditional engineering methods. Instead of just measuring individual performance, the new technology is answering the question of how many people within a facility are actually needed. Forecasting, scheduling, planning and monitoring capabilities are also being added to the standard LMS, says Schnorbach.

Ten years ago, engineered labor standards were contained in stand-alone applications. Today they are an integral part of larger systems, designed to gauge the productivity of warehouse workers. "It's becoming a much more pressing issue," Schnorbach says.

To some extent, the technology is running ahead of the industry for which it's intended. Some companies are only now beginning to acquire systems for setting up engineered labor standards. The functionality is in use among "only the most mature labor-management users," Schnorbach says. Those same companies are also on the lookout for systems that can add forecasting and scheduling to the mix.

The transition from engineered standards to an accurate calculation of the optimally sized workforce is a complicated matter, he says. Managers need sophisticated analytics that can sift through tens of millions of variables to come up with the best solution. "It's impossible to humanly solve," he says.

For calculating the right amount of labor, Schnorbach advises companies to establish three planning horizons: annually, with periodic reviews, and for special events such as promotions and new-product introductions.

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Keywords: supply chain, supply chain management, inventory control, warehouse management systems, WMS, labor management systems, LMS, inventory management, logistics management, supply chain planning