3 Steps to a More Powerful Strategic Workforce Planning Process

An Unpredictable World

Growth, downsizing, pivoting – whatever the case may be, the workplace is dynamic and often unpredictable.
It almost impossible to predict what changes may occur: There may be a sudden need to add dozens or hundreds of employees in new business areas or in different parts of the world. There may be a sudden shift in products that makes many employees redundant and raises the demand for people no has recruited before.
New roles emerge, new positions and functions are invented, and more and more frequently there is no one with those skills.

The Problem With Tradition Planning

Traditional workforce planning has been based on two very large assumptions: that there are enough workers available and at the salary you are willing to pay. These assumptions held true for the most part until roughly a decade ago.

Today is just as often the case that a recruiter is seeking the so-called “purple squirrel” – that elusive one-of-a-kind person with a unique set of skills, or someone with skills they have never looked for before.

The shortage of talent, the rise of new skills and needs, coupled with changes in the global workplace has forced many organizations to change how they look at workforce planning. They are realizing that it is nowhere nearly enough to just calculate turnover and projected growth and then go recruit the people. The people they need may not exist or they may be very hard to find. Sometimes they are available but in far corners of the globe and sometimes the time needed to find and recruit becomes too long.

On top of this, internal mobility or career advancement are often not even part of a recruiter’s responsibility.


The Challenge

The whole process of acquiring talent requires more sophisticated thinking and tools than have previously been characteristic of the human resources function. There are fewer traditional jobs and fewer traditional sources of talent that are still reliable. The challenge of supplying talent to businesses will grow and has already created a new emphasis on strategic workforce planning.

An effective workforce planning process will focus on the following three areas:

  • Market & corporate strategy awareness and market scanning in order to better see emerging trends
  • Systems-level Workforce planning focused on identifying and filling key positions by integrating employee development, internal mobility, as well as recruiting
  • Scenario planning and dynamic modeling to help focus activity and justify investments in a variety of approaches

Step 1: Market & Corporate Awareness and Market Scanning

Workforce planners need to be aware of business, economic, political, demographic and social changes, and trends. They also need to keep up-to-date on emerging skills needs within their organizations as well as the industry.
For example, many years ago Cisco Systems identified the need for Web programMarket-Research-Startupsmers very early. They realized that there were very few who had those skills, so they started hiring new college grads with backgrounds in music and math and trained them in HTML programming. This gave them a decisive advantage over the competition leaving them to scramble to catch up.
Keeping tabs on who has critical skills and where they are located will be a differentiator in how successful your sourcing will be. It will also provide the inputs you need to calculate whether a development program would be more cost-effective than a recruiting approach or what combination would be most economical and effective for your organization.
Talent supply data is the most difficult information for a recruiter to get today. It is almost impossible to know how many people with a particular skill are in the market.
However, by data mining the job boards, looking at college graduation figures, and using data from the organization’s own recruiting website, it may be possible to estimate the supply.

Step 2: Systems Integration Approach

In a market where certain skills may not exist at all or where they are very scarce, recruiting is inadequate. It may make more sense to find the skills needed internally or make more sense to develop internal or external people to meet the needs.
If workforce planning is made the highest-level activity – integrating employee development, internal mobility, recruiting, retention activities, and succession planning within – organizations can make a start on acquiring above-average talent.
Removing the talent supply from being the sole responsibility of recruiting to a broader set of functions allows more comprehensive thinking. For example, consider the case of when a need for a new skill-set arises. Rather than immediately opening a requisition, a hiring manager, along with a talent manager, would go through a process of looking at internal talent, modeling the costs and time involved in training someone for the position, predicting the available supply and time to recruit someone, and the time it would take to train the person.

Step 3: Scenario Planning and Dynamic Modeling

Although scenario planning is no longer new, having been around since the 1960s, HR can use it to look at various potential talent-demand situations.
Many Arrows of OpportunityScenario planning, sometimes simplistically referred to as what-if planning, looks at a variety of economic and business trends, as well as other factors that have been identified as possibly impacting the supply of talent. Using different sets of factors, scenario planners develop recommended responses to meet the supply challenge.
By including in this process some of the mathematical modeling tools that are available, a talent manager could project, for example, the benefits of training over hiring or of the value of one source of candidates over another based on turnover and time to productivity. Over the next few years, analysis, modeling, and integrated planning will become common in human resources.
Talent planning has become an important function, but unfortunately a function that is often without the foresight or power to influence talent decisions or direction. Following these 3 steps might be a way to start the change.

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