Is your company concerned about securing the right talent, skills and capabilities either for today or the years to come? If so, you’re not alone. According to a recent study, business leaders across the globe rank talent-related concerns as their number one challenge heading into the next decade.

The problem for many organisations is that they are dealing with multiple talent-related challenges, including increased demand for technical skills, a global labour shortage, an ageing workforce and a highly competitive marketplace. The combination of these challenges has made it difficult for employers to attract and retain the talent they need to remain competitive.

One of the best ways your organisation can overcome these challenges and prepare your workforce for the future is an effective workforce planning strategy. Keep reading to learn more about what workforce planning is, how it can add value to your organisation and what steps your company can take today to get started.

what is workforce planning?

Workforce planning is the process of evaluating the organisation’s current skill sets and projected future needs in order to identify potential skills gaps or upcoming shifts in the workforce. It also involves developing and implementing robust action plans that are designed to help close any skills gaps and to enable the organisation to build its desired current and future workforce.

One mistake many organisations make is to solely focus on the short-term workforce management needs of the company. While meeting the current talent needs of the organisation is definitely a major priority, failing to simultaneously plan for the future of work can significantly hinder your company’s ability to grow. An effective workforce planning process should focus on the current needs of the organisation as well as preparing for the next two to three years.

how does workforce planning add value to your company?

The most obvious benefit workforce planning offers is the ability to acquire and retain the specific talent and skills your company requires moving into the future. This factor, however, is incredibly important considering the growing skills gap and the highly competitive job market. In fact, studies show that 87% of global employers admit to already having a skills gap within the company or that they anticipate a skills gap in the upcoming years.

Having an active workforce planning process in place can help close this gap by allowing your organisation to identify and address its future talent needs before it has time to widen. The reality is that without a proper workforce planning process in place, it may be nearly impossible for employers to find the talent required when the need arises.

If the global pandemic taught organisations anything, it’s the need to maintain a flexible workforce. Fortunately, another benefit of having a strategic plan in place is that it adds a level of adaptability and flexibility to the workforce. Workforce planning will also provide your company with valuable insights as to the current talent that already exist, so it can adapt quickly to any changes if necessary.

The workforce planning process can also improve operational efficiencies within the business by ensuring that the organisation has the right skills, talents and capabilities available when they need them. This, in turn, can help spur business growth and enable your organisation to remain competitive for years to come.

the workforce planning process
the workforce planning process

the workforce planning process

Workforce planning is not a singular action. Rather, it’s a continuous, step-by-step process that must work in direct alignment with your organisation’s overall objectives and goals. It’s important that the planning team consist not just of members from the HR department, but also executive leaders as well as financial and operational managers.

This cross-functional collaboration will enable your planning team to develop an accurate vision for the company’s future workforce and to implement company-wide action plans that drive results.

Below is a closer look at the five-step workforce planning process.

Visuals blogs - the workforce planning process
Visuals blogs - the workforce planning process

1.  create a sense of urgency

For workforce planning to be successful, it must have a strong and continuous commitment at all levels within the organisation. It’s vital that the HR department, executive leaders and operational managers all understand the urgency of planning a workforce for the future.

It’s often up to the HR department to create this sense of urgency by helping other team members understand the various talent challenges facing the company, such as today’s competitive job market, the organisation’s ageing workforce and a growing skills gap. Instilling this sense of urgency is especially important when it comes to top management and will be necessary to secure an investment in resources and implementation of the action plans. 

It’s also  important to secure a commitment from every member of the workforce planning team before moving on to the next step.

2.  from strategy to human resources

Once everyone understands the need for workforce planning, you can start the process of merging the organisational strategy to human resource objectives. The team should take the time to answer questions, such as “Where does the company want to be in two to three years?” and “In what areas is the company anticipating growth or change?”

Understanding the overall vision and future goals of the company is the primary basis for workforce planning. For example, if the company wants to increase the use of automation over the next few years, there will be an increased need for technical skills within the company and a possible reduction in the size of the workforce.

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Understanding the overall vision and future goals of the company is the primary basis for workforce planning

When creating human resource objectives, it’s essential to consider both quantitative and qualitative factors. For instance, how many more managers will be needed in the upcoming years (quantitative) as well as what specific skills the company needs now and in the future (qualitative). Through this process, your team will gain a clear vision of the organisation’s desired current and future workforce.

3.  workforce analysis

The next phase of the workforce planning process is to conduct a comprehensive workforce analysis. This step requires your team to determine exactly what skills already exist within the company, distinguish between which of these talents the organisation will still need in the near future and which ones will become obsolete, and identify what capabilities are still needed for the future of work.

Throughout this stage, it’s important to gain insight from company leaders pertaining to the direction of the company, as well as from floor managers who have direct knowledge of the types of skills required for day-to-day operations. This input will allow your team to obtain a comprehensive view of the current and future workforce of the company.

The easiest way to conduct this high-level analysis is to classify different skills, capabilities and talents into various groupings. For workforce planning purposes, there are seven possible groupings, including:

  1. key players: permanent workers the organisation needs now and in the future
  2. unexploited potential: permanent workers who are likely to be needed in the future
  3. to move: permanent workers who may need to shift to other roles within the company
  4. current core staff: permanent workers who are essential now but may not be in the future
  5. temporary workers: workers who the organisation will no longer need in the future
  6. most wanted: skills that the company needs now and in the future
  7. prospects: skills that the company is likely to need in the future

4.  the transition

When the workforce analysis has been completed, it’s time to start the transition phase of the process. This is the stage where the team determine which HR interventions are most effective and the implementation process begins.

It’s critical to develop separate HR interventions for each talent group listed above. Developing unique action plans for each worker type will significantly improve overall outcomes. For example, mobility plans are ideal for workers whose skills will no longer be needed within the organisation. On the other hand, a robust recruitment plan can help to ensure your organisation can acquire the prospects necessary both now and in the future.

While it’s common for the HR team to take the lead on many parts of the workforce planning process, operational managers are usually responsible for implementing HR interventions. Typically, this makes the most sense since managers have direct access to the workers.

Communication is key when it comes to implementation. It’s vital for operational managers to not only communicate these action plans to the workforce, but they should also encourage their workers to take advantage of these opportunities. Direct dialogue between managers and employees can help your workers realise the importance of developing their skills and careers.

Most importantly, any HR interventions must be fair and unbiased. All employees within a set talent group should have access to the same opportunities. 

5.  embedding the plan

While the final step is embedding the plan with the organisational strategy, it’s not the end of the workforce management process. Instead, workforce planning is a circular process that must be consistently evaluated, assessed and adjusted to meet the changing needs of the company. This continuous process will help to make workforce planning a permanent function within the organisational strategy.

It’s during this stage that the effectiveness of various action plans can be measured and assessed. Based on these assessments, your organisation can make changes to specific action plans or alter the way these plans are implemented throughout the process.

For a more in-depth look at how workforce planning can prepare your organisation for the future of work, download our comprehensive white paper detailing the workforce planning process.

about the author
sanjay shetty
sanjay shetty

sanjay shetty

head, search & selection & strategic accounts

sanjay shetty is a human resource or "Talent Specialist" with more than 21 years of experience of hiring across all industries and levels and managing relationships with companies across India

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