You’ve likely heard the term workforce planning, but what makes a workforce plan strategic?
If you’re looking to improve your talent pool and bring success to your company, a strategic workforce plan is critical in today’s global economy with ever increasing talent shortages. Leaders with strategic workforce planning skills provide a competitive edge to their organizations.
The reason strategic workforce planning is so misunderstood and sought after is because it is highly complex, and requires a lot of data and the ability to analyze and explain findings to higher management.
If you don’t have a plan, developing talent management is going to be a lot harder and consume more time.
What is strategic workforce planning?
First let’s understand exactly what strategic workforce planning is. Strategic workforce planning is the purposeful process by which an organization determines the future human resource requirements needed to achieve its strategic objectives.
According to the Human Workforce Institute, “it builds upon quantitative activities, such as headcount planning and workforce analytics and uses that data as part of a qualitative decision framework that can inform and transform organizational strategy.”
It requires an understanding of the entire organization in a deep and detailed way. And in a way that can be condensed so it makes sense to people beyond the data. And, it requires a close connection to business strategy and planning, includes detailed needs assessments and scenario planning and typically looks out three to five years.
Why is strategic workforce planning important?
If you have proper workforce planning, you can anticipate changes in the marketplace and the workforce, and can mobilize appropriate resources.
“A disciplined approach to this process gives an organization the ability to change more quickly than its competitors and to more effectively maximize its return on investments in talent,” write Brian E. Wilkerson and Amanda Oldridge. “As a result, workforce planning can be the difference between a successful business offering and a missed opportunity.”
The reality of strategic workforce planning
Here are a few things about strategic workforce planning that will give you a better understanding of it in the workplace today.
- In a study from i4cp, only 22% of organizations said they engaged in strategic workforce planning.
- 36% of organizations engage in tactical workforce planning (staffing plans, budget reconciliation and training schedules), which typically look out no more than a year.
- 52% of organizations do operational workforce planning (headcount forecasting, scheduling/coverage and staffing requisitions), which typically looks out weeks or months and is the most basic form.
- Only 37% of respondents said that their organization had a person dedicated full-time to workforce planning as a leader.
Although these statistics are low, the trend is up and more companies are increasing their efforts in strategic workforce planning. If you want your organization to succeed, you can’t take a limited view of workforce planning (or talent management as a whole). The most successful companies are continuously executing strategic workforce planning; it is not something done once a year, or only looked on as an HR function.
According to Bersin and Associates research, organizations that practice advanced workforce planning had, on average, 28% higher impact scores in efficiency, effectiveness and business alignment of HR functions than competitors who don’t.
With all the evidence that strategic workforce planning is a competitive advantage for companies, what is holding you and your company back? When your next planning cycle begins, make sure one of your key initiatives is to launch a strategic workforce planning process.
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