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Libby Marks

Strategic Workforce Planning: How-To & Best Practices

Plan your workforce like a pro with our complete guide to strategic workforce planning - what it is, why it matters, who’s involved, and how to ace it.

Strategic workforce planning is about aligning your human resources with your long-term organizational goals. Done right, it ensures you have the people and skills you need to ace your strategic objectives. 

Many businesses don’t engage in strategic workforce planning. Perhaps because they’re trapped in the vicious cycle of reactive resourcing. Or because they think they can’t plan far enough ahead to make it worth their time.

In this guide, we’ll prove the value of proactive workforce planning and show how to adapt it to business in even unpredictable circumstances - like project-based businesses and professional services. 

From workforce analysis and skills mapping to scenario and succession planning, this guide to strategic workforce planning has everything you need to know.

What is strategic workforce planning?

Strategic workforce planning is about getting the right people in the right positions at the right time - so your business has the capacity and capabilities to deliver its longer-term strategy.

The purpose is to improve your organizational efficiency, agility, and competitiveness - by staffing your business with the perfect balance of people and skills. (Not so many that you’re wasting money on people you don’t need. Not so few that your employees are overworked and plotting their escape.)

It’s all about proactively aligning recruitment, retention, and resourcing strategies with your overarching corporate agenda. 

Without a strategic workforce plan - surviving 🛟

Without strategic workforce planning, organizations experience inefficiencies, delays, and lost opportunities. Do you recognize any of the following symptoms of poor workforce planning in your business?

  • Too many staff to deliver services cost-effectively
  • So few staff they’re overworked and projects are delayed
  • Too many skills that are no longer needed 
  • Too few skills that are increasingly in demand
  • Reactively responding to staffing needs
  • Avoidable gaps between vacancies arising and being filled
  • Being blindsided by the departure of key personnel 

With a strategic workforce plan - thriving 💪

Conversely, businesses that do have a workforce planning strategy gain a significant competitive advantage. They have:

  • The right number of people to maximize efficiency and productivity
  • A balanced workload that supports timely delivery and high employee satisfaction 
  • The right skills and talent to deliver high-quality services - now and in the future
  • Complete visibility into vacancies that are coming up
  • A pipeline of people to fill future roles 

What does strategic workforce planning involve?

With strategic workforce planning, instead of reactively addressing immediate staffing needs, organizations forecast and plan for future workforce demand. At a basic level, it involves:

  • Forecasting future workforce needs based on corporate strategy
  • Identifying critical skills and job roles for future success 
  • Assessing the suitability of your current workforce
  • Developing strategies to address any shortfalls

This strategic staffing approach enhances operational efficiency, adaptability, ability to seize opportunities, and the quality of products and services. 

We’ll explore some key components of workforce planning later.

Who is responsible for strategic workforce planning in a business?

Sometimes a business has a dedicated strategic workforce planning team. But often responsibility is shared between a cross-departmental team. Here are ten teams that might be involved in strategic workforce planning in your organization.  

  • Business leaders - Provide overall strategic direction for workforce planning initiatives, ensuring alignment with the organization's goals, priorities, and direction of travel.
  • Human Resources/talent team - Develop and manage workforce planning processes and policies, identify skill gaps, engage in recruitment, retention, and talent development activities.
  • Resource management team/RMO - Engage in capacity and scenario planning - and provide data and insights around resource utilization - to inform recruitment and training strategies.
  • Training and development team - Collaborates with HR to identify skill gaps and develop training programs to address those gaps - so the workforce evolves to meet business needs 
  • Operations/line managers - Identify workforce needs based on operational requirements - plus input into role design,  and collaborate on succession planning for key positions
  • Diversity and inclusion team - Drive initiatives to foster a more diverse and inclusive workplace, to create a culture where everyone can thrive and contribute equally.
  • Legal and compliance team - Ensures that workforce planning initiatives comply with relevant labor laws, regulations, and ethical standards.
  • Finance team - Provide financial guidance for workforce planning - including budgeting for recruitment, training, and development.
  • Marketing and communications team - Articulate and communicate employer brand to support external recruitment and internal retention efforts.
  • Employee representatives - Ensure the employee experience is considered and reflected in workforce planning activities, provide input and feedback to improve initiatives 

Strategic workforce planning: A step-by-step guide

Below, we’ve outlined the six steps of an effective workforce planning process. Follow them and you’ll create a future-focused, fit-for-purpose workforce.

The steps are applicable in any business. But - at Runn - we’re especially interested in helping project-based businesses navigate their dynamic operating environment. So read the next section too, if that sounds like you.

Step 1: Secure buy-in and assemble your team

The first step in strategic workforce planning is to recognize the value in doing it. If your organization has historically taken a reactive approach to resourcing, you’ll need to create a business case for doing things differently. Educate yourself on the benefits of strategic workforce planning and start getting buy-in.

Effective workforce planning needs cross-departmental collaboration. You’ll need to engage stakeholders from your senior leadership team, HR, resourcing, training and development, finance, and more. See a full list of possible stakeholders above. 

Step 2: Get to grips with business goals

The purpose of strategic workforce planning is to align your workforce with your organizational goals. So this step is key. Get your senior leadership team to articulate their vision for the business in the medium to long-term - typically three to five years. Dive deep into goals, objectives, growth plans, diversification, new initiatives, or changes in direction. 

Remember to engage all teams in this discussion to avoid problems further down the road. For example, you’ll need a budget for any new roles you create, so finance needs to be in the loop. Similarly, new staff will need equipment and resources, training, and onboarding. Every team needs to align on what has to happen and why.

Step 3: Forecast future needs 

Equipped with a detailed understanding of your overall business strategy - and external factors like technological change and industry trends - think about the people, skills, and roles you’ll need in the future.

Engage in organizational capacity planning to create an accurate picture of workforce supply and demand. And think about role design - how to create meaningful roles that maximize the contribution employees can make.

Runn offers powerful capacity planning features to analyze and forecast demand.

Step 4: Assess the current workforce

Now you know the type, number, and nature of roles you need for the future - it’s time to compare that to what you currently have. This part of the process will be easier if you already engage in centralized resource management and have a skills management process in place.

Analyze the fitness of the current workforce for the future. Look at demographics, roles, skills, and competencies. What gaps do you need to fill? Are you faced with an aging workforce? Are key players approaching retirement? Have you got a high turnover? Do roles need redesigning? 

Step 5: Develop a strategy to bridge the gap

This is the exciting part - forming a plan and putting it into practice. This can include strategies around:

  • Recruitment
  • Pipeline development
  • Talent management
  • Succession planning
  • Training and upskilling
  • Redundancy and reskilling
  • DEI initiatives
  • Flexible working
  • People-centric practices
  • Staff satisfaction 
  • Employer branding
  • Corporate culture
  • And more

Step 6: Implement and monitor

As part of your strategy, you should set KPIs - ways to monitor and measure your success. Regularly monitor progress against these KPIs and make adjustments as necessary. Conduct a full review your workforce planning strategy every time your corporate strategy is updated. 

Adapting strategic workforce planning for project-based businesses

If you work in a project-based business, you’re probably thinking: ‘This is all well and good. But what if you can’t plan three to five years in advance? What if you’re not sure what the next six months look like?’

We hear you. Strategic workforce planning is more difficult in dynamic landscapes like professional service firms, studios, agencies, and the knowledge economy.

But there are still things you can do. Based on the step-by-step guide above, here are some tweaks for project-based businesses.

Step 1: Look as far ahead as you can

As with any business, it’s key to understand strategic direction. The difference is that you can’t look ahead with the same level of certainty as some businesses. You are reliant on winning work - and your workforce demand will depend on the number and type of projects you secure.

However, you still have a strategy. Your senior leaders know the sort of project they want to pursue - for example, whether it’s more of the same or striking out in a different direction. And they know whether they’re aiming for growth or diversification.

Understanding even this information can help you begin to forecast future workforce needs - the number of people, types of roles, and skill sets you’ll need to fulfill their vision. 

Step 2: Use scenario planning 

Where our other businesses used organizational capacity planning to forecast demand, you might choose scenario planning instead. Scenario planning is planning for the what-ifs - preparing for different possible scenarios and assessing the impact on factors like revenue, capacity, and resources. 

This approach helps you be as prepared as possible in an ever-changing environment. It lets you explore multiple possible futures - for example, winning Projects A, B, and E - and forecast likely skill and talent requirements. 

If circumstances change and you end up with Projects A, E, and F - you have already planned for that scenario too, and are ready to put an alternative workforce strategy into action. 

Step 3: Plan for unpredictability 

The same initiatives apply to project-based businesses as any other. So Step 6 above still applies. But the less unpredictable nature of project-based businesses may want to focus a little more on workforce agility. 

For example, developing a flexible staffing model that comprises a core team of permanent employees, supported by a flexible roster of trusted contract workers and freelancer suppliers.

Or a skills diversification program. This upskills and cross-trains people in the most in-demand skills in the business, so they can be allocated to a wider range of projects, as demand dictates.

Strategic workforce planning examples

Here are five examples of strategic workforce planning initiatives - including what they are, and why you should do them. These are representative of the type of activities you’ll undertake as part of a workforce planning strategy. But it isn’t an exhaustive list.

1. Capacity planning

Workforce capacity planning is the process by which you determine if you have capacity to deliver your future plans. It’s about working out the ‘demand’ side of the supply-and-demand equation. 

For a professional service business, capacity planning ensures your organization has the skills and resources it needs to complete projects on time, on budget, and to customer expectations. Done properly, it answers two key questions.

  • Do we have the necessary resources to complete our work?
  • When do we have the capacity to take on more work?

Strategic workforce planning, of course, is concerned with answering the first question. 

During your workforce capacity assessment, you might discover you have too few staff, in which case you have the time and information you need to recruit more. Or you could discover you have too many or the wrong type of resources. In which case you’ll have to think about how best to retrain and redeploy them. 

2. Succession planning 

Succession planning is the process of identifying and developing people with potential in your business, so they can take on more senior roles when positions become available. For example, planning to replace a retiring Head of Department with a talented manager from their division.

Succession planning helps ensure business continuity, providing a pipeline of internal talent to fill vacancies. It also provides growth opportunities for ambitious employees, helping retain them and their knowledge within the business. Plus it’s more cost-effective than hiring senior talent externally. 

3. Skills mapping

Skills mapping is your first step towards plugging any skills gaps, which are predicted to cost business $8.5 trillion by 2030.  

It involves identifying, documenting, and assessing the skills and competencies you have across your organization. Skills management software is extremely helpful here. The goal is to create a comprehensive overview of the capabilities available in your business - so you can deploy them effectively or develop them to meet future needs.

Because - sadly - you can’t rely on simply hiring new skills - top talent is in short supply. And savvy businesses know it’s more cost-effective to develop people internally, through training courses, apprenticeships, mentoring, etc.

Try using Runn to create a skills map for your team

4. Pipeline development

Much as we promote training and developing internal staff, you do sometimes need to look outside the business and hire in external talent. Pipeline development is the process of nurturing that external talent so that it’s readily accessible when you need it.

A pipeline development strategy could involve:

  • Building relationships with relevant schools and colleges, to raise awareness of opportunities with their soon-to-graduate students
  • Introducing apprenticeships and training programs to attract and nurture new talent
  • Engaging in - or sponsoring - industry events to showcase your expertise and build brand awareness 
  • Creating a strong employer brand, so you’re front of mind for potential applicants and become an employer-of-choice

By cultivating relationships with external talent pools, businesses can reduce time-to-fill critical positions and mitigating talent shortages. This means less disruption to business continuity and improved access to in-demand skills.

5. People-centric policies 

At Runn, we’re advocates for people-centric policies - business practices that put people first. We’ve seen how it can transform unhappy and unproductive workplaces into places where people want to work and excel. 

Examples of people-centric policies include:

  • Flexible work arrangements that accommodate individual preferences and needs - like our own asynchronous work initiative 
  • Diversity, equality, and inclusion initiatives that create a fair, comfortable, and productive workplace for all
  • Work-life balance and well-being initiatives that help people stay healthy and happy, at work and outside it
  • Paid time-out for professional development - as well as career breaks for those who need them

People-first policies can enhance employee satisfaction and retention, improve work-life balance, boost engagement and productivity, and attract a broader talent pool. All of which can help achieve your strategic workforce goals.

These are just five ways your organization can get strategic about staffing and align talent with organizational goals

4 strategic workforce planning best practices

Make data-based decisions 

Gut feelings only get you so far. You need to base your workforce planning strategy on hard data. Analyze historic and current workforce data to make more informed decisions. Leveraging data like employee turnover and demographics can help you identify trends and forecast future requirements. While data on resource utilization can signpost in-demand skills and roles. You can also look at external data - from assessing industry trends to benchmarking against competitors - to help shape your forecasts.

Keep current employees informed

Aim for transparency and employee engagement in your workforce planning process. This can mitigate unnecessary anxiety and prevent rumors undermining morale. It can also support your strategic aims, by letting people know there are progression routes available and that you’re investing in their skills. Research shows employees are more engaged in businesses that have a clear vision for the future. 

Engage in resource management

Resource management is about making the most of the workforce you have. It looks beyond simple headcount and considers how allocating resources can maximize productivity and profitability. But many businesses still haven’t realized the benefits of resource management - like reducing bottlenecks and burnout, and improving utilization and efficiency. We want to change that. Read our deep-dive guide on resource management.

Runn offers better resource visibility across projects and makes resource allocation easier

Save time with workforce planning tools

There are lots of workforce planning tools that can help make this process quicker and easier. And who wouldn’t want that? 

A resource management platform - for example - can provide all the information you need about your current workforce - their skills, capacity, and how in-demand they are. 

It also supports scenario modeling and capacity planning. And all without having to touch a cumbersome spreadsheet or complicated pivot table. 

Discover Runn for strategic workforce planning

Enjoy 14-days free access to Runn and explore 

  • The central resource pool - every employee, skill set, and availability in one place
  • Skills management - reports and dashboards on skills and competencies
  • Capacity planning - see utilization rates and resource capacity at a glance
  • Scenario planning - test different scenarios with a drag-and-drop project builder
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