A productive workforce is critical to your success, and central to ensuring that you consistently deliver a product or service that’s of the very highest quality. A strategic approach to every area of your business ensures, as much as possible, that there are no unwelcome surprises heading your way, and gives reassurance that key business targets, goals and objectives are likely to be met in good time.
It’s somewhat surprising then that organizations don’t put as much thought into strategic workforce planning as they do into other areas of the business. A recent CIPD survey found that just 46% of organizations had a workforce planning strategy in place to address current and forecasted skill requirements.
But this is changing. Strategic workforce planning is gaining in popularity across many of the biggest and brightest organisations around the world, with more and more businesses valuing the many benefits that a strategic approach to skills management brings to their day-to-day operations. If you don’t have a strategic workforce plan in place, then now’s the time to address that. And even if you do, the chances are it could be modified and improved with a few simple tweaks.
The world of talent management and acquisition is a constantly evolving one, and at Unleash we are committed to staying ahead of the curve by reporting on current trends and anticipating what might come next. We’ve noticed a sharp uptick in organizations prioritising strategic workforce management, and in this article we’ll tell you more about what it is, why it’s so important, and how you can implement it in your business.
What is strategic workforce planning?
Strategic workforce planning addresses the skills and talent (both available and lacking) across the entire organization, enabling leaders to plan ahead to address current and future skills gaps. It also helps ensure that the right people are in the right place across your organization so that you are maximizing the productivity of your workforce.
Strategic workforce planning concentrates on getting the right skills and talent in the right place, whereas HR planning, also known as manpower planning, focuses on ongoing talent management. But more on that later. The principles of strategic workforce planning focus on analyzing, planning and forecasting workforce supply and demand, so that you’re 100% confident that you’ll always have the right skills on hand at any given time of the year.
In our recently released “Why HR Projects Fail” report, we found that a massive 84% of respondents claimed that their recent HR projects had been unsuccessful. There will be a number of reasons as to why that is, but the lack of a strategic workforce plan will be one of the major ones.
A strategic approach to workforce planning means designing and implementing a process that proactively predicts both current and future skills needs. This gives you stable staff levels across every area of your organization and ensures the right skills are in the right place to optimise efficiency and productivity.
A strategic workforce plan considers not only the HR requirements of the business, but also the finances, business analytics and input from the procurement team. For that reason, it’s an ongoing task that needs buy-in from all areas of the business and cross-departmental communication in order to be effective. Done right, your people planning will ensure that your business is best placed to deliver on your KPIs and organizational goals and targets.
Why is strategic workforce planning important?
Strategic workforce planning delivers assurance to the business, and it also helps to predict gaps in skills long before they happen so you can factor that into your recruitment plan. That way, you’ll get the warning you need to take the necessary steps to plug a skills gap, long before it causes implications for your business. This shift from a reactive to a proactive mindset will revolutionize the way in which your organization performs, and will reduce pressure on your workforce too.
If you don’t take a strategic approach to your people planning, you will find that there are unwelcome surprises in your day-to-day operations. That’s why it’s so vital that you put a robust plan in place that provides assurance to senior management and identifies gaps in your workforce long before they become apparent.
Being able to predict staffing issues before they arise will also lead to a much happier workforce. If you can plug skills gaps and put plans in place to cover times when you know you’ll be thin on resources, your staff will feel less pressure and be able to get on with their job without feeling overly burdened or stressed.
How do I create a strategic workforce plan?
A strategic workforce plan is simple to create, as long as you’re organised and have a clear idea of what you want to achieve and what problems you want to solve. The first step for any HR manager when considering a strategic workforce plan is to review the overall objectives of your business. Everything you do should lead back to this, so take time to study the organization’s central strategy document and be sure that you fully understand the primary goals and targets of the business. Understanding where the organization wants to go is key to your success as an HR department.
The good news is that, with this 5-step strategic workforce planning framework, you can approach the task in stages.
A five-step strategic workforce planning framework
Not sure where to start when it comes to building your own strategic workforce plan? Here’s an easy 5-step framework to guide you along the way.
A great strategic workforce plan starts with understanding your current resources. You should ensure that you have a full list of every position and job description within the business, and a corresponding map that highlights your team’s core skills. This way you’ll be able to clearly set out where you are now, and what resources you have available. It’s also vital to have a clear understanding of the organization’s wider strategy.
It is also a great idea to carry out some benchmarking against your competitors – how do they manage their workforce and does it work for them? What does best practice look like in your industry?
Drilling down into the numbers will give you some rich information to use to inform your strategic workforce plan. What do your staff retention numbers look like? Where are the skills gaps in your organization? Consider why might you be losing staff – is an exit interview common practice, and if not, could one be implemented? Are there patterns in your understaffing issues and could the data give you an answer as to why this might be?
- Write your plan
Now you know where the issues are, and what you need to do to address them, how are you going to get there? A strategic workforce plan with associated actions will enable you to focus on the biggest staffing issues in your organization and gain a clear understanding of where current and future skills and talent gaps are. This will begin to inform your workforce and recruitment planning.
- Implement your plan
Once you have a salient workforce action plan in place, it’s time to implement it. It should feed directly into your recruitment plan as well as your day-to-day operations. All actions should be specific with a clear deadline on them to ensure that nothing gets missed, or left too late. It’s important that you have adequate resources in place to support your plan – this means liaising with your finance department to ensure that budgets are realistic.
- Monitoring and evaluating
As with any strategic plan, you won’t get it right the first time, and things will change. You should constantly monitor and evaluate your plan, ensuring it continues to meet your objectives and is working across the organization. This way, you can identify the things that aren’t going right, and adapt the plan accordingly.
Workforce planning and HR
Workforce planning sits firmly with the Human Resources department, and by focusing on skills as much as talent management you’ll ensure that you are supporting your organization in all the ways it expects of you. Your work is also an essential part of the puzzle when it comes to achieving organizational goals and targets.
What is the role of HR in strategic workforce planning?
It’s the job of the Human Resources department to devise and implement strategic workforce planning, but you’ll need input from other departments, too. Ensuring you have the right people in the right roles at any given time is absolutely central to the role of HR, and strategic workforce planning is critical to this.
While the role of HR is to analyse, forecast and plan workforce supply and demand, it’s also important that other departments such as finance and procurement are also involved in the conversations. So while the strategic workforce plan sits firmly within the HR department, it must be communicated across the organization too, in order to attract buy-in from every department. HR’s role is not only to deliver the plan, but also to communicate it across the organisation as well.
The difference between workforce planning and HR planning
Strategic workforce planning focuses on the distribution of skills and talents across the organization and supports the operational aims of the business, whereas HR planning (also known as manpower management) is more concerned with talent management, recruitment and retention. Workforce planning looks at the different departments across the organization, ensuring that the right skills are being deployed in the right place, and that skills gaps are identified and addressed to keep the firm running at optimum efficiency at all times.
Workforce planning and HR data analytics
HR data analytics are invaluable when it comes to strategic workforce planning, and it’s important to use data to inform your strategy. That data can also help you model ‘what-if’ scenarios and assess the impact that various events might have on your workforce. You can use traditional HR planning software to ascertain various elements of what you need to inform your workforce plan, but you can also look at using bespoke workforce planning software alongside.
The better shape your data is in, the more value it will bring to your strategic workforce planning. That quality of your data should be reviewed regularly, otherwise it might skew your understanding of current and future workforce needs. This data should be mapped to your plan, intelligently supporting your business to achieve its objectives and determine training and recruitment needs.
The benefits of strategic workforce planning
Being able to predict and forecast gaps in your skills map and/or workforce is critical business intelligence, and it will serve you well and help to inform the most important decisions at the highest levels. Providing your senior leadership team with a robust strategic workforce plan that’s backed up by data will increase confidence in your department and give you the leverage you need to request more budget or resources to support your departmental goals.
As the saying goes, forewarned is forearmed. By identifying issues before they arise and taking a strategic approach to your workforce planning, your HR function will perform better and workforce needs can be addressed and resolved in good time.
Ultimately, a well-defined strategic workforce plan will lead to a happier, healthier team that’s motivated and feels well-supported, especially when things get tough.
Remote workforce planning
You need to take into account your remote workforce as much as your on-site workforce when workforce planning. Remote working requirements vary on the type of organization, but if a proportion of your staff are working off-site then there will be additional workforce planning challenges that you’ll need to address.
This includes training, appraisals and regular day-to-day communication and work delegation. Tools such as Slack are great for boosting internal communications, whether your employees are on or off-site, and it’s a great way to keep everyone in touch with each other.
You’ll find that if your HR department has a good handle on internal communications and management of all staff, whether remote or on-site, you’ll be able to conduct your remote workforce planning far more easily. All the main workforce planning principles remain the same, but you’ll need to take into account other variables.
With 16% of companies now working 100% from home, this is a trend that isn’t going away. Smart organizations are getting ahead of the game by ensuring that their remote workforce planning is just as robust and effective as their on-site workforce planning.
There’s no doubt that a well-executed strategic workforce plan can alleviate pressure on a team. It will effectively support business objectives by ensuring that an organization is constantly running at peak efficiency, and addressing issues before they arise.
If you’d like to learn more about strategic workforce planning and many other HR issues, Unleash offers a wide range of thought-provoking roundtables and webinars. You may find this webinar on “Making the case for People Analytics to your leadership” of particular benefit – visit the ‘On Demand‘ section of our site for more.