In today's ever-evolving business environment, organizations need to be smart about who they are hiring and how can they help achieve their business goals.
This involves taking into consideration the future skills of the organization's workforce, the employees you have onboard, the ones that require further upskilling and the talent you would need to hire in the future.
That's where Strategic Workforce Planning comes into play.
What is Strategic Workforce Planning?
In simple words, Strategic Workforce Planning is an analytics-based process to acquire the right talent, at the right time and in the right place. It includes aligning the workforce with your enterprise goals.
As the dynamics and technology of the global marketplace keep advancing, it equips businesses to stay competitive.
Strategic Workforce Planning is defined as an analytical, planning and forecasting process of defining plans to optimize the organization's talent supply and business demands at the right time.
Businesses use this process because, in the absence of an effective workforce plan, they run the risk of not having adequate employees to grow the business. On the other hand, the risk of taking more talent eats into the bottom line.
6 Steps to Implement Strategic Workforce Planning into Your Business
Step 1 – Align Business Strategy with Hiring Needs
The first step is to align your workforce plan needs and long-term and short-term business strategies to plan your hiring needs correctly.
If there is a change to the business strategy due to reasons such as rolling out a new product or expanding to a new geography, review your strategic workforce plan. Leaders must ask themselves what aspects of the business strategy could potentially change the current talent and acquisition approach.
To get the ball rolling, take all stakeholders on board including HR, the finance department, line managers and the C-suite.
Step 2 - Analyze and Identify the Future Needs for Talent and Skills
After aligning your business strategy with your workforce plan, the next step involves identifying the skills and competencies needed to support the requirement.
You could start by breaking down the skills and competencies needed against the external and internal workforce supply. Then, project the staff needed, at what step and when.
Some questions to be answered are: what types of talent would allow the shift in strategy? What are the expected timelines for each stage of recruitment including screening, interview, notice period and onboarding?
For a successful business strategy - prioritize the roles and outline the critical ones.
Talent analytics in the form of workforce analytics gives you insights into the quality and quantity of the workforce. That includes the demographics, seniority profile, current performance, future potential, new hires, employee turnover and internal promotions.
Step 3 – Analyze the Talent Supply and Undertake a Gap Analysis
You should analyze your internal workforce to understand the current in-house competencies and the potential gaps that need to be filled. The demographic trends in your workforce shift over time. An informed recruitment process weighs existing employee compensation and value propositions against market trends and competition.
For example, conducting a skill gap analysis would show if you need gig workers to shift to more project-based employment. Or would you prefer upskilling and training existing employees? Or maybe, a combination of both. Another fact worth considering is digitization and technology development and whether you can fill that digital skills gap in the organization.
A great way to collect employee opinions is using surveys to know their take on various aspects of your business. Additionally, employee exit surveys give insights into the level of employee satisfaction in your organization, teams and departments.
Step 4 – Preparing for Different Scenarios
Once you identify the talent needed and the time when you would hire them, the subsequent step is to develop a tactical plan outlining the course of action.
However, the future is still unpredictable. That is exactly the reason why the stakeholders use the Strategic Workforce Planning process to prepare for unexpected situations.
Let's take the example of a Supermarket Cashier. An increasing number of supermarkets are installing self-checkout machines for their customers to scan and pay for their products.
Taking into consideration this model, the changes the management anticipates are:
A decreasing need for cashiers
A growing need for re-training the workforce so that they can move into other roles
Along with being prepared for industry-specific developments, unexpected situations entail a significant change in the business’s financial situation or an economic global slowdown.
And generally speaking, technology and automation are replacing and changing jobs. That being said, it is unlikely that every job would be affected, or each employee would retire.
Instead, HR can implement the Strategic Workforce Planning framework to anticipate the changes and to come up with strategies of attrition, up-skilling, or re-skilling to avoid future lay-offs.
Step 5 – Create and Execute a Plan
Now that you know the organization’s objectives, goals and current capacity, the next step is to create a plan to identify the cost of hiring new employees or training the existing ones and the timeframe for this activity.
Ideally, the plan should cover:
Start with the C-suite and work down – Create a top-level plan that is shared with both the decision-makers and division managers. Even at a granular level, the managers have to ensure that they operate within the timeframe you have put together.
Other factors – Turnover rate, skill set adjustment and the gap between hiring the personnel and when they actually start to work at the organization are some of the factors worth considering.
While executing the plan, keep the CEO and other key stakeholders in the loop with regular updates.
Two activities to consider, to ensure the plan does not go off the rail are:
Create a weekly plan – A weekly status report informs the stakeholders of the progress on the key aspects.
Have a backup plan for different scenarios – Monitor the plan from the beginning and don’t hesitate to make adjustments. A backup plan would help you respond to problem situations more efficiently.
Step 6 – Monitor the Progress and Evaluate the Impact
After implementing your plan and hitting some key milestones, it is crucial to monitor and evaluate the progress and impact. This is to confirm that the plan is aligned with the business goals and strategy.
The question you would ask is, "Did you achieve the objectives and desired results in the set timeframe?" Identify the key metrics to measure success so that they can be tracked and optimized. A live document could adapt to the changes the industry and business go through.
As the Strategic Workforce Planning model is implemented in full swing, you would collect real-time data. Every quarter or monthly, you could take the time to evaluate the plan. This can include:
Software to track HR metrics – Oracle Cloud HCM can crunch data, conduct workforce analysis and create actionable reports. The conclusions could help you make adjustments to improve the plan.
Taking a second look at the objectives – Chances are, in the months since you first implemented workforce planning, your objectives may have shifted. Analyze your business objectives, because they are bent to change in case of a wholesale shift in your organization’s direction. You may need to revisit the steps.
Have a comparison with existing metrics and benchmarks. At the same time, all stakeholders would need visibility and communication about the progress of the plan.
Preparing your Workforce for Tomorrow
The benefits of Strategic Workforce Planning entail all aspects of the organization ranging from workforce retention, recruitment, learning, development, compensation and benefits.
Mastek is the global provider of Oracle Strategic Workforce Planning to startups, corporates, multinationals and SMEs in every sector. We have helped 1,200+ companies define a set of procedures for workforce planning to deal with and eventually avoid hiring problems, take advantage of talent opportunities and improve your organization's talent pipeline.
As Oracle Partners, we enable you to determine the talent segments delivering high returns and therefore need higher investment.