Workforce planning helps you find and hire the right people now and in the future. If a business is only as good as its people, workforce planning is the key to success.
The success of any organization relies first and foremost on its people. The ability of a company to attract and retain the best talent has a huge influence on its ability to deliver on its goals.
However, workforce planning is not straightforward, and there is a range of reasons why. A business may need a very specific skill set that can be hard to hire for. It may have a high turnover rate in key positions over a short period of time. Or it may be paying well above the market rate for the skills it has on staff.
Alternatively, there may be a global shortage of skills within certain industries. This issue has affected education, construction and healthcare sectors particularly in recent years.
These are all common issues that impact an organization's ability to develop its ideal workforce.
Rather than leaving staffing to chance, it's always best to be proactive. That means carrying out strategic workforce planning to ensure a business has the right skills and talent to deliver on business objectives both now and into the future. Learn what goes into workforce planning in our ultimate guide.
A commonly used workforce planning definition is the way an organization analyzes its workforce and determines the steps it must take to prepare for future talent needs.
It's arguably one of the most impactful aspects of human resources and people management. By understanding both current and future business needs, HR leaders can enable business objectives to be achieved efficiently and affordably.
However, workforce planning is about more than just a staffing strategy. It also includes working closely with your current workforce to foster skills development, as well as recognizing opportunities to improve the organizational design of the business.
In the context of human resource management, a workforce planning strategy involves actively managing issues such as:
Talent management is perhaps one of the most cost-effective workforce planning strategies. By helping current employees to develop and upskill, an organization can future proof itself from the disruption that can occur when staff leave. No organization maintains the same workforce forever, so staff turnover is an inevitability that it pays to prepare for.
There are many workforce planning examples that illustrate just how significant this preparation can be.
Consider that onboarding an external hire can take a long time. Even a competent hire will lack business context and historical knowledge, and it can take months, or even years, to develop all of the productive relationships that enable them to do their best work.
However, being able to promote an internal employee is much smoother. They understand the organization's goals already, they have existing relationships, and they are likely to be well invested in the organization's success.
That person is also likely to be cheaper than an external hire. What's more, this enables the organization to afford to offer financial incentives that encourage them to be productive and successful in their new role.
Workforce planning can be instrumental in this process by identifying future leaders and fostering their skills development to ensure they're satisfied, suitably challenged, and able to take on extra responsibility if required.
Organizational development firm McKinsey & Co describes workforce planning as primarily the responsibility of HR managers and business leaders.
It says, "To usher in the organization of the future, Chief Human Resources Officers and other leaders should do nothing less than reimagine the basic tenets of organization."
That requires HR leaders and business managers to plan ahead for the success of the business and ensure their staffing plan supports the business to perform the way it should.
In light of the effect of the Covid pandemic, the Harvard Business Review has identified different ways business leaders are considering their workforce planning model:
All of these models affect the strategic workforce planning of the organization. Flexible, remote work is increasingly being sought after by employees, and businesses that cater for this are likely to be able to attract the best people. Workforce planning is important to enable a new-look workforce to deliver on existing business objectives.
At the same time, business objectives may have changed since the onset of the pandemic. In this instance, workforce planning remains critical as it provides a roadmap to hiring the right people for these new goals.
A workforce planning template is part of an organization's plan for how it will realize its long term objectives. By planning the makeup of their future workforce, businesses get a clear picture for how they will achieve their growth and other goals.
Step 1: Assess current talent supply
One of the core functions of human resource management is matching talent supply with demand. In workforce planning, this involves analyzing both internal and external talent to understand the supply of skills, and more importantly, skill gaps.
Issues include identifying current staff members who are at risk of leaving or retiring, current team strengths, the cost of acquiring new talent, and the availability of talent in your resource pool.
Step 2: Recognize future needs
Review the organization's plans and goals for the future. This helps to inform the demand for talent. Understand critical skills that will support key objectives, expansion goals, as well as possible changes to staffing requirements and how projects will be staffed.
Step 3: Identify the gaps
Understand the difference between where the organization is currently and where it's looking to be from a staffing perspective. As well as skill gaps, this can also include skills surpluses too.
Step 4: Find the solution
How will those gaps be filled? There is a range of questions that need to be answered in the workforce planning process.
For workforce gaps that can be filled internally, what sort of training needs to occur for current teams to be able to meet the future demand? What does the organization need to do to retain high performers?
For those that require external hires, how will the organization attract satisfactory new talent? When will you make key hires? How will you afford to pay them?
Workforce planning has a range of benefits for organizations that do it. The greatest benefit is in enabling it to achieve its goals and objectives. Other benefits include:
Not only does workforce planning benefit businesses, but it's also significant for individual employees.
Consider also that each benefit to an employee is also a benefit to the organization as a whole, which is able to get the most out of its people.
There are a range of techniques organizations can use in strategic workforce planning. It helps to be data driven as much as possible, being informed by genuine business insights to deliver the biggest impact possible.
Strategic workforce planning also supports project work to be more cost effective, and this happens in a range of ways:
There are a range of workforce planning tools available, and many of them are specialized pieces of software for exactly this purpose. Runn is a leading example of workforce planning software that makes it easy and engaging to carry out strategic workforce planning.
Runn is extremely user-friendly, with a simple, intuitive interface and engaging, visible reports that make valuable insights prominent and shareable.
Talk to Runn today about booking a demo, or sign up to try Runn for free.
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