The specific workforce planning process varies depending on the size of your business, industry and the labor market. In an unpredictable labor market or for a startup company, the workforce planning process may look out a year or two in the future. In contrast, a well-established company in a steady labor market might take a longer view. Below are some best practices to consider regardless of the specific duration of your workforce planning program:
1. Take the time to create a strategic plan
Effective workforce planning relies on having a concrete and actionable strategic plan. Not only does a well-formed strategic plan serve as a “north star” to guide you through the workforce planning process, but it can also help monitor progress and evaluate the impact of your proposed solutions.
2. Make workforce planning a collaborative process
Workforce planning works best when there is input from a wide range of stakeholders and there is buy-in across all facets of the business. Consult with different business teams and seek feedback from employees. When communicating the workforce plan, share information regarding the “why” and “how” so that employees throughout the organization understand the goal of any workforce changes.
3. Engage senior leadership in the process
Although workforce planning impacts HR, the process shouldn’t be delegated solely to the HR department. To be effective and sustainable, the workforce planning program should involve senior leadership, who should consider factors such as organization structure, succession planning, budgets, risk reduction and strategic plans.
4. Define your KPIs
To track progress and assess the impact of workforce planning solutions, it is crucial to have appropriate KPIs in place. Some common KPIs to include in your workforce planning program include employee head count, attrition rate, retention rate, promotion rate, tenure, quality of hire, voluntary vs. involuntary turnover rate, eNPS and diversity metrics.
5. Leverage data
Data is your workforce planning friend. By relying on data, you can make informed decisions and justify staffing decisions. Look at current staffing, employee retention rates, employee promotion rates, time-to-hire period and other vital measurements.
6. Pay attention to labor market insights
Understanding labor market trends, especially in your industry, will help you assess potential staffing needs. If multiple competitors are on a hiring spree, it could give you some key insights into where your industry is going and what your organization needs to do to prepare for it.
7. Consider alternative solutions
Workforce planning extends beyond hiring and terminating employees. Workforce planning should consider several options, including technological solutions, temporary employees and contractors. Workforce planning might also include adjustments to operations to remove bottlenecks, enhance efficiency, scale operations and employee transfers. The most effective workforce planning programs use a combination of talent strategies to meet their needs, including hiring talent, developing talent, redesigning workflow, redeploying talent and contracting with talent.
Bottom Line
Workforce planning isn’t a quick fix; it takes time, effort and careful deliberation. But workforce planning is well worth the time and effort it takes. When done well, workforce planning can boost retention rates, minimize inefficiencies and help the business achieve its goals.
FAQs
Workforce planning, also known as strategic workplace planning, is the process of analyzing, forecasting and planning workforce supply and demand. It involves reviewing current staff, examining current and future personnel needs and identifying gaps between supply and demand.
What is the definition of workforce planning? ›
Workforce Planning is the process of analyzing, forecasting, and planning workforce supply and demand, assessing gaps, and determining target talent management interventions to ensure that an organization has the right people - with the right skills in the right places at the right time - to fulfill its mandate and ...
What are the 5 key elements of workforce planning? ›
- INTRODUCTION. Workforce planning is the systematic process for identifying and. ...
- OPM'S 5-STEP. WORKFORCE. ...
- Step 1: Set. Strategic. ...
- Step 2: Analyze. Workforce, ...
- Step 3: Develop. Action Plan. ...
- Implement. Action Plan. ...
- Step 5: Monitor, Evaluate, and Revise.
It includes analysing the current workforce, determining future workforce needs, identifying the gap between the present and the future, and implementing solutions so that an organisation can accomplish its mission, goals, and strategic plan.
What are the steps in workforce planning answers? ›
The six steps for strategic workforce planning
- What is the plan? Where is your business going? ...
- Who do we have now? The next step is to analyse the talent you have on hand. ...
- What do we do next? ...
- Skill and talent gaps. ...
- Fixes & Initiatives. ...
- Measure Results.
An effective workforce plan must address "Seven Rs" that ensures your strategic workforce plan can deliver 'the right people, with the right skills, in the right roles, with the right shape, in the right place, at the right time and the right cost'.
What are the main purposes of workforce planning? ›
Provide professional development. Workforce planning may help develop a more skilled staff by identifying skill gaps and providing training in these areas. Reduce labor costs. Workforce planning strives to reduce labor costs by promoting efficiency within the workforce and eliminating unproductive practices.
What are the 4 C's of workforce planning? ›
The Harvard Model of HRM, with its 4C framework, plays a pivotal role in aligning human resource practices with strategic business objectives. Commitment, competence, congruence, and cost-effectiveness are the core outcomes that guide HR policies towards fostering a productive and harmonious work environment.
What is an example of a workforce plan? ›
Examples of strategic workforce planning
Addressing employee turnover through employee engagement and training programs. Introducing training programs to help employees achieve career goals. Developing leaders through workshops and outside training programs. Analyzing technology's impact on employees.
What are the 4 basic components of a work plan? ›
Below, we'll dive deeper into these four basic planning components and how you can use them to be more productive.
- Rework big goals into small objectives. ...
- Clarify objectives by converting them into a series of tasks. ...
- Lay out and manage task timelines visually. ...
- Take advantage of visual task management tools.
By leveraging AI, the 5 R's framework—Right People, Right Skills, Right Roles, Right Time, and Right Cost—provides a comprehensive strategy for aligning your workforce with your business goals.
How do you create an effective workforce plan? ›
Key elements of workforce planning
- Set strategic direction. ...
- Analyse workforce, identify skill gaps and conduct workforce. ...
- Develop, action, plan. ...
- Implement the action plan. ...
- Monitor, evaluate and advise.
While the HR department is typically responsible for the bulk of workforce planning initiatives, other members of senior management may be involved in the workforce planning process, including the CEO, COO, CFO and other leaders responsible for organizational strategy.
What is the difference between HR and workforce planning? ›
HR and workforce planning are entirely different processes
HR planning is the process of managing resources to meet regulatory requirements, organisational requirements and business objectives. Workforce planning is about managing resources into the future in order to meet business objectives.
What is the focus of workforce planning? ›
It involves reducing labor costs, responding to changing customer needs, identifying strategies for people development, targeting inefficiencies, improving employee retention, productivity, and work-life balance, and delivering strategic value through talent.
What is the job description of workforce planning? ›
Workforce Planner (Trust)
This role has the primary responsibility for ensuring a workforce plan is in place for the organisation, identifying any workforce risks and issues which may affect future demand and using this information to complete workforce data returns required by the system.
