Article
In 2026, workforce optimization means designing the right size and shape of workforce for real demand—balancing people, skills, and cost so the organization can adapt, perform, and grow without overcorrection
I’m Kim, VP of Workforce Strategy at City Shift Finance. I want to start with a question that
might make you uncomfortable. How much money did your organization leave on the table
this year because your workforce wasn’t set up right? Not because people weren’t working
hard—I’m sure they were. But because the way you’ve set up your teams, the way you’re
managing labor costs, is probably costing you more than you think. And here’s the thing—
most leaders don’t even know it’s happening.
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I’ve spent years working with organizations on workforce optimization, and I can tell you
that the gap between what leaders think is happening and what’s actually happening is big.
They think they need more people. They think they need more budget. But what they
actually need is to fix how they’re using the people they already have. And that difference
matters a lot.
Let me tell you what I mean. Most organizations plan their workforce the same way they’ve
been doing it for years. They look at last year’s headcount, they adjust a little bit, they set a
budget, and they call it done. But that approach assumes that the way you set things up in
the past is still the right way today. And in 2026, with everything that’s changed, that
assumption is expensive.
Here’s what’s actually happening. Work has changed. People are working from home and in
the office. AI and automation are taking over some jobs while creating new ones. Some jobs
are hard to fill and others are easier. Younger workers want different things than older
workers did. And if you’re still using the same setup you had a few years ago, you’re not just
slow—you’re working against yourself
“Most workforce problems in 2026 aren’t caused by being understaffed—they’re caused by outdated assumptions about how work should be organized and delivered.”
Let me give you an example. We worked with an organization that thought they didn’t have enough staff. They were behind on work, they had backlogs, and their leaders wanted to hire more people. But when we looked at their workforce allocation, we found something interesting. They didn’t need more people. They had the wrong people doing the wrong work in the wrong places. About thirty percent of their staff spent most of their time on tasks that could be automated or just stopped. Another twenty percent were in jobs that didn’t match what the organization actually needed anymore. They didn’t need more people. They needed to use the people they had better.
We redesigned their workforce structure to identify where the real problems were. We looked at which jobs actually created value and which ones were just there because they’d always been there. We found where they had skill gaps and where they had too many people doing the same thing. We figured out which tasks could be automated, which ones could be done by contractors, and which ones needed full-time staff. The result? Overall head count decreased by twelve percent through natural attrition and strategic reallocation, while service delivery improved by twenty-eight percent. They saved money and achieved better results with a right-sized team because people were finally in the right roles. That’s what strategic labor cost planning looks like when you actually do it.
Now, I know what some of you are thinking. That sounds nice, but our situation is different. We’re special. Our problems are unique. And you’re right—your situation is unique. But the basic rules of workforce optimization aren’t. And that’s what most leaders miss. They get so focused on why they’re different that they don’t use the basic rules that would actually fix their problem.
Your workforce should be built around what you’re trying to do, not around the org chart you got from the person before you. Most organizations have org charts that show old decisions, political deals, and structures that made sense ten years ago but don’t make sense now. If you’re not willing to question those structures, you’re not going to optimize labor costs. And I get it—questioning those structures is uncomfortable. People have built their careers around those org charts. But staying comfortable is expensive, and in 2026, most organizations can’t afford it.
Not all jobs are equal, and pretending they are is one of the most expensive mistakes we make. Some jobs in your organization directly create the results that matter. Other jobs support those jobs. And some jobs—let’s be honest—are just there because they’ve always been there. Workforce optimization means being tough about figuring out which is which and making hard choices about where to spend money and where to cut. The organizations that are doing well right now are the ones that have accepted this. They’re tracking performance and aligning staffing plans with actual business needs instead of historical precedent, or what they did last year.
Being flexible is worth more than having a big headcount, and that’s hard to accept for leaders who grew up thinking that having more people meant you were more powerful. But the organizations that are winning in 2026 are the ones that built flexible workforce models. They’re using a mix of full-time workers, contractors, part-time staff, and automation to create capacity that can go up or down when they need it to. They’re not stuck with fixed costs that become problems the moment things change. And things always change. This is where workforce optimization technology matters—not to replace your strategy, but to give you the flexibility you need when the market shifts.
Workforce optimization isn’t something you do once and forget about. It’s something you keep doing. The organizations that are getting the best results are the ones that built workforce optimization strategies into how they work every day. They review their workforce setup every quarter. They test their staffing plans against different scenarios. They track early warning signs of workforce problems, not just late indicators like turnover or how many jobs are open. They stopped treating workforce planning like a once-a-year thing and started treating it like an ongoing strategic job. They’re asking questions like “how do we match our workforce structure with what we’re actually trying to do?” and “where are we wasting resources?” These aren’t just day-to-day questions—they’re big-picture ones.
Here’s what I’ve learned after working on this problem with different organizations. The ones that win at workforce optimization aren’t the ones with the biggest budgets or the fanciest HR systems. They’re the ones that are willing to ask hard questions and make hard choices. They’re willing to challenge things that have been in place for years. They’re willing to move people around even when it’s uncomfortable. And they’re willing to do the hard work of actually understanding how their workforce is set up and where they’re wasting money. They’re finding labor cost risks and opportunities before they become big problems.
“Workforce optimization becomes a competitive advantage when leaders treat it as a continuous discipline, not a one-time cost exercise.”
Because here’s the truth. Every day you wait to optimize your workforce is another day
you’re leaving money on the table. It’s another day your people are working harder than
they should because they’re not set up to win. It’s another day you’re falling behind
organizations that already figured this out. And when you’re competing, that gap gets
bigger fast. The hidden costs of people quitting, bad scheduling, and jobs that don’t match
what you need add up faster than most leaders think.
The good news is that workforce optimization gives you one of the best returns on
investment you can get. Organizations regularly see double-digit improvements in the first
year. Cost savings that pay for the work ten times over. People are happier because they’re
finally in jobs where they can actually win. But none of that happens by accident. It
happens because leaders decided to stop accepting things as they are and start making
them better.
So here’s my challenge to you. Take a hard look at your workforce structure. Not the one
you wish you had, but the one you actually have. Ask yourself if it’s really set up to get you
what you need in 2026. And if the answer is no, or even if the answer is “I’m not sure,” then
it’s time to do something about it. Thanks for tuning in.
About the host
Kim has spent years helping organizations redesign their workforce models to improve performance, reduce structural inefficiencies, and align labor decisions with enterprise priorities.
