Agile workforce planning is as much about managing relationships as it is managing processes

A lasting lesson from the pandemic is that we can no longer let even a vigorous economy lull us into complacency about all that we produce and consume, or the intricate supply chains that enable us to do both. Everything seems more vulnerable, but once discovered, vulnerabilities can also reveal new opportunities.

Specifically, the pandemic exposed how dependent business organizations are on other organizations within their ecosystems, and how well business functions within the same organization are connected and how much they depend on one another. The need to rapidly adapt and respond in a uniquely volatile environment has forced managers to think beyond the narrow definition of their own business functions. They must now take a broader perspective about how they interact with other business functions to adopt new processes, make accurate forecasts, course correct, and ultimately contribute to overall organizational agility.

Every business function depends acutely on its workforce. Consequently, workforce planning is no longer regarded as simply “an HR task” but rather a collaborative effort across the organization, with HR playing a central role. Workforce planning required HR to guide their peers in other business functions beyond the idea that workforce planning is primarily headcount planning, wherein only financial impacts are evaluated. It has also enabled HR to involve leaders across the organization as partners in strategic areas of HR, such as workforce agility, workforce optimization, workforce visibility, equity, and diversity and inclusion. Successfully bringing together numerous stakeholders in workforce planning results from HR conscientiously managing both processes and relationships.

Traditionally, every department, including HR, manages their own transactional systems, their own data collection, analysis, and reporting activities. But workforce planning requires several departments cooperating, and making those connections often creates friction that slows the planning process down and decreases organizational agility. Three of the most common friction points HR encounters are with Finance, IT, and line-of-business managers.

HR and finance: Two distinct notions of what it means to add value

Much of the friction between HR and finance stems from historically dissimilar perspectives about how workers should be reckoned. For finance, workers are costs to be contained, while for HR, they are people to be managed. Because finance controls the money stream, it has far more leverage regarding major workforce decisions, and puts HR in a longstanding position of having to quantify the value of the workforce according to financial terms.

Finance and HR are now finding themselves having to address the same questions: How well do we really understand our customers and their behaviors? How much are we willing to bet on it? How do we create customer value and how does that translate into business value? Is our workforce in the best position to bring about both? Additionally, finance is increasingly preoccupied with boosting margins, driving growth, and managing risk holistically. The perils of not being able to deliver goods and services on time and of sufficient quality due to workforce deficiencies is no abstraction, especially in sectors hit hard by the pandemic.

HR and finance must also contend with a workforce increasingly being asked to do more with less, requiring additional training and support. In an environment where HR and finance collaborate in planning and budgeting for improved onboarding, engagement, and training, HR can provide finance with greater insight into the total costs of recruitment and worker replacement and the range of organizational performance outcomes likely to affect critical financial metrics. These can help better inform organizational change initiatives and assure that they are driven by a shared understanding of all cost dimensions.

HR and IT: Data frenemies

HR technology implementations, configurations, and integrations are infamous for being patchworks of enterprise, point solutions, and spreadsheets. From a time-management perspective, it’s a hefty load for HR and IT teams to pull together data, usually of questionable quality and completeness, from disparate systems, cleanse and structure it into a usable format, and then distribute it all to managers.

The partnership that HR and IT have worked so hard to develop gets strained. No matter how many clever hacks anyone can call upon, the process is not easily repeatable, and mistakes in data require complete cycles to correct. The whole purpose of agile planning gets defeated by the lack of agility to stand up plans.

HR and line-of-business managers: “Tell me what I am looking at here”

Line-of-business managers know their department’s operations inside out, and it’s often presumed that their line of sight extends just as keenly to their portion of the workforce. As a result, they are dealt into the planning process well after the initial stage, given partially refined data and a list of tasks, but little context or guidance.

Nevertheless, they persevere. Understanding workforce data well enough to discuss it confidently in meetings with peers poses a high cognitive load on managers. They spend excessive time trying to make sense of the data, verifying sources, and making judgment calls on which data is valid or relevant. Ultimately, they have to construct the whole picture for themselves, tell their own story, and hope it ends up being the right story.

A central player

No other business function touches more of the enterprise than HR and no one is an island in workforce planning. HR is in a unique position to ease friction by forming effective liaisons between planning leaders (finance), data and system provisioners (IT), and key end-users (line-of-business managers). Whether acting in its own capacity or as a broker between business functions, everything HR does affects many other teams, organizations, and divisions, and ultimately the agility of workforce planning and the entire organization.