Four Emerging Strategic Workforce Planning Trends
Workforce planning presents an important opportunity for the HR function to deliver real insights to the business, by providing a holistic view of their workforce and an understanding of how their talent strategy aligns to business strategy. It’s also an opportunity for HR to not only facilitate strategic workforce conversations but to set the agenda for workforce change and increase credibility as a trusted advisor to the business.
When done well, workforce planning can lead to greater innovation, talent generation and process improvement within an organisation. Allowing informed, data-driven talent decisions to be made, that are aligned to strategic priorities and underpinned by advanced and predictive analytics. It can ensure that your organisation is prepared, with the right talent and skills in place to go beyond reacting to circumstantial market events, but offer insights and intelligence to help organisations focus on areas such as:
Reducing labour costs in favour of workforce deployment and flexibility
Identifying skills gaps and areas of succession risk
Relevant strategies for talent management and people development
Targeting specific and identified inefficiencies
Employee retention initiatives
Strategic workforce planning is one of the key components of effective human capital management and a topic widely discussed as having an ever-growing importance on the future of work and an area that is seeing considerable evolution.
As more emphasis is placed on workforce planning across organisations, we’re seeing four new trends emerging that are really evolving the way that workforce planning is carried out and shaping what ‘good’ strategic workforce planning looks like.
Trend 1: Strategic Workforce Planning must be jointly owned with the Business and Finance
The first and probably most discussed trend we’re seeing is the need for joint ownership of strategic workforce planning processes with the business and finance, in which discussions are led and facilitated by HR.
There has been extensive amounts of research looking into why organisations fail at sustaining and embedding workforce planning processes. One of the key factors identified is the lack of communication between various functions of the organisation, such as finance, HR and the business, around why strategic workforce planning is important and where ownership of such processes lie. Without clear understanding around the ‘why’ and the ‘what’s in it for me’, lack of buy-in from both within HR and the business is inevitable. Research conducted by OrgVue indicates that less than half of HR (40%) and finance decision makers in the UK and US believe they have a collaborative relationship. While it is becoming widely recognised that if the benefits of SWP are to be reaped then we must begin to foster better relationships between the different functions involved in the workforce planning process. One way that this can be achieved is by involving the necessary stakeholders in the design of the SWP approach. Not only will this be informative, but it will also serve to gain greater buy-in and drive real change as processes are implemented.
Ultimately the role of HR is shifting from enforcer to ‘facilitator’ of workforce planning within an organisation. Its primary role is bringing the right people to the workforce planning table and facilitating the right conversations to break down the planning silos that are, all too often, prevalent in many organisations. We need to foster more collaboration and knowledge-sharing in which a continuous dialog between HR and the business is maintained.
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Trend 2: Understanding the skills of your workforce and informing internal talent mobility
The second trend that is being recognised is the need for workforce planning to include skills data and to support career pathing and internal mobility. Talent mobility focuses on companies understanding how to optimise their organisation for productivity, growth and success – all while keeping their employees engaged in both their current and future career. Retaining this next-generation workforce in order to remain competitive in any industry requires a focus to be placed on both skills mapping and talent mobility in any workforce planning and retention strategies that an organisation creates.
Ensuring that your workforce planning process collates the necessary data to support career pathing is imperative. It not only enables your organisation to prepare for the evolution of work by understanding your skills landscape but increases the likelihood of staff embracing the concept of one company and many careers. In order for career pathing to be successful, decisions around promotions or lateral moves must be aligned with your organisational aims and this is achieved with accurate data on individual job competencies and a framework which includes career roadmaps and career pathing tools for your employees.
Trend 3: Incorporating external labour market data into Strategic Workforce Planning
The third trend is ensuring there is an understanding of external labour market data and how this compares to internal supply and demand. By analysing and understanding the external talent market, companies can make more informed decisions about where they could or should be hiring and how to prioritise the talent component of real estate investment decisions.
While it is imperative that there is a consideration for and alignment with external labour markets, Alicia Roach outlines in her article “How to Successfully Implement Strategic Workforce Planning” that while the external environment is incredibly important it should not be the primary focus of SWP.
“I have seen SWP processes come unstuck by becoming overly focused on external environmental scanning, which results in a bunch of interesting, but un-contextualised data points about what is going on in the wide world”
She explains that once an organisation understands their internal requirements, they can and should contextualise the external data collected by overlaying such impacts onto their business, through dynamic scenario planning. While alignment to external labour market data has a rightful place in the strategic workforce planning process it’s not the first step an organisation should be taking.
Trend 4: Focusing on tasks and not jobs
The fourth and final trend is the need to focus your workforce planning on tasks not jobs. It is believed that the highest ROI on talent investment will come from redesigning jobs, moving away from the concept of job roles to focus on the tasks that make up a job in order to deliver greater value for the organisation and the individual. In order to do that, it is important to conduct deeper analysis, focusing on how to break jobs down into tasks, where tasks overlap, which activities are future-critical, and which will become obsolete. Dave Ulrich explains that the “focus of talent management is less on planning a workforce than on accomplishing work tasks”, however in order to do just that, task planning should be a critical step in your strategic workforce plan.
Moving forward as the future of work continues to take shape, it is important to note that conducting your workforce planning based on the tasks that make up a role, does not discount people but instead enables organisations to shift the work that people complete to focus on more strategic, creative and unique tasks.
Strategic workforce planning presents an important opportunity not just for the HR function but for the business as a whole. Organisations that are effectively ‘doing’ strategic workforce planning experience an average of 10% higher business outcomes such as revenue per employee, ROE or profit per employee.
While it is important that your strategic workforce planning process enables better collaboration cross functionally, is owned jointly by finance and the business and facilitated by HR, encompasses skills data, drives career planning, and aligns to external labour market data, what is most important is that it results in driving real action and decision making that leads to business value.
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