A comprehensive approach for workforce planning, featuring insights from the Human Capital Institute
We read everywhere that business is global—it’s not becoming global, it is global. People are working remotely and collaborating globally more than ever before. Companies are opening offices in more places all over the world and hiring in local communities more than ever before, all in a period of heightened competition to attract and retain top talent. Additionally, according to recently released research on workforce planning by Workday and the Human Capital Institute (HCI) surveying nearly 400 professionals, employees are growing increasingly disengaged and more are demanding flexible work engagements.
These reasons, along with the need to mitigate risk and adapt to changing business models, aren’t unnoticed by HR leaders—the majority of the companies surveyed acknowledged the need for a comprehensive approach to strategic workforce planning. According to Jenna Filipkowski, the director of research at HCI and author of the survey report, effective implementation of a strategic workforce plan can enable leaders to “address the workforce skill and capability gaps and changing workforce demographics, and to facilitate growth plans for new markets.”
Yet only 44 percent of companies surveyed report that they are effective at tying workforce strategy to business strategy. Additionally, 45 percent say that they are unprepared for the talent needs of the future.
But as one survey respondent said, we all have to start somewhere—and in this blog, I’ll detail the eight keys HCI recommends in order to implement a successful strategic workforce plan.
Key 1: Articulate workforce planning processes that support and sync talent and business outcomes
According to the report, the strategic workforce planning process should flow throughout the organization and repeated as necessary for greatest success. But when companies were asked how often they revised their plans, more than half admitted that they do it only once a year. Not only that, but only 43 percent of respondents say that their process is scalable across the organization.
Clearly, these numbers can be improved—and doing so requires working with a living plan that can be adjusted in real time, using real-time data, so that HR leaders can identify skill deficiencies and improve operational efficiency to ensure that business results will align with company goals.
Key 2: Segment roles to determine how each position contributes value and which roles are a priority or on the periphery
Do you have too many account executives (AEs) and not enough engineers? Or too many people in the finance department and not enough in marketing? To determine this, HR leaders need to identify the key skills needed in the company, particularly those that are most directly correlated to revenue, cost, controls, or cost and operational efficiencies.
For example, in a robust economy, Company A wants to increase revenue and raises sales goals for its AEs. HR leaders and hiring managers must then quickly determine how much support the AEs will need from a demand generation perspective and hire for those roles accordingly. On the other hand, if the economy contracts and the company sees a drop in demand, it’s likely to slow or freeze hiring for non-essential roles.
Key 3: Conduct a scan of the workplace environment to identify and monitor trends that affect the workforce and the organization
With employee disengagement rising, implementing employee engagement programs to address retention risk is becoming increasingly important for companies that want to attract and retain top talent.
If your company doesn’t do so already, a good place to start would be to survey your employee base. Additionally (and this may be somewhat controversial), you should continue conducting performance reviews—but ensure that they’re fair. One way to ensure fairness is to “rate the rater” or manager, which then allows you to normalize the routinely low and and high scores.
Leaders can then see whether an employee is stagnating in a role, based on data like time since the last promotion or raise, and if there’s a better fit in another department or another role. This data can also be used for proper filtering to determine which employees are ready for a promotion.
Key 4: Inventory and evaluate the current workforce and management
This sounds similar to the last point as it also ties into retention planning, but there is a slight difference: By looking at data across the workforce, leaders can identify if there is a particular department in which attrition is happening more than others. Once identified, they can provide a solution, such as improved leadership training, to address the situation.
Key 5: Construct a detailed plan of how the organization and the workplace environment should look in the coming years.
Markets are always evolving. Demographics change, new regions become stale while old ones are revived, and consumer demands shift. To stay competitive, you should consider advances in both technological and operational norms—for example, new technologies can help you stay on top of required headcount for new markets or redistribute headcount based on consumer demand.
Having a process that facilitates conversations with your lines of business leaders and their HR counterparts is essential for surfacing future skills needs—and having the right strategic workforce planning solution can help you with that. The first step is to determine what skill sets are needed for getting ahead of disruptors (trends- or technology-based) in your current market and new markets, as well as for newly identified channels to deliver your products or services (e.g., online vs. big box stores). The process should also encompass identifying trends in how your workforce of the future is deployed and address questions such as how the growing trend of having virtual teams will impact office space requirements.
Key 6: Identify gaps between the current state of the workforce and the desired future state of your organization.
This goes back to Key 4 discussed in the first blog, which outlines the importance of inventorying and evaluating the current workforce and management. After gathering the information about your workforce, you can now use the data to compare and see whether your current workforce meets your company’s needs in the near future. If new skill sets or training is necessary, you can develop a timeline for transitioning the workforce to ensure you stay ahead of competitors.
Key 7: Build in a repeatable action plan to revise pieces (or all) of your workforce planning process to better reflect organizational changes or new talent source system initiatives that require integration.
Change happens. Full collaboration among people, data, and technology is key to effective workforce planning process maintenance. As mentioned in Key 1 and according to the HCI report, the strategic workforce planning process should flow throughout the organization and be repeated as necessary for greatest success. However, only 55 percent of respondents reported revising their strategic workforce plans on a yearly basis, while 13 percent said they “never” revise their plans. On top of that, 12 percent said they revise their plans biannually, and the remaining 12 percent do it quarterly.
Key 8: Monitor and report quantitative and qualitative benchmarks and milestones to stakeholders and management.
According to the survey, the lack of analytic capabilities is one of the biggest barriers to using data effectively for strategic workforce planning and is driving strong demand for corporate talent management software.
And no wonder: Less than half of survey participants reported that their workforce planning team analyzes data effectively (45 percent). Seventy-one percent cited utilizing predictive talent analytics as one of the top challenges, while 66 percent said the ability to access data spanning the entire talent lifecycle was a challenge. Additionally, 66 percent of respondents said tying talent data to business outcomes was difficult and 61 percent had trouble integrating data from other business functions.
As you can see, strategic workforce planning is still a challenge for many companies. However, with a solution like Anaplan Workforce Planning in place, you can plan for and optimize the workforce as needed so your organization can gain and maintain its competitive edge.
For more information on how Anaplan helps HR departments, watch the workforce planning video.