'Failing to plan is planning to fail' – we all know this age-old adage but many organisations, big and small, aren't placing enough emphasis on strategically planning the shape and size of their future workforce. Short-termism – only planning six to twelve months out and being reactive to business needs – is common.
The purpose of strategic workforce planning (SWP) is to focus on your forward planning, and get ahead of the curve – and the market. Done properly, it'll set you up with the right capabilities, in the right place, at the right time, with a workforce that's aligned to your business model, pipeline and ambitions.
Strategic workforce planning is essential as it helps organisations proactively address talent challenges, optimise workforce capabilities and align human capital with business strategy. Ultimately, SWP contributes to a business's overall success and competitiveness. Placing sufficient emphasis in this area requires senior-level buy-in, however, and understanding SWP's value to the business.
Key outputs driving the need for strategic workforce planning:
SWP helps you anticipate and plan for future workforce needs, ensuring you have the right talent with the necessary capabilities to support the organisation's long-term strategic objectives.
It helps you respond more quickly to changes in the business landscape, such as entering new markets, launching new products or adapting to technological advancements.
It helps you identify the competencies needed for future roles, and to design and implement targeted development programmes that will prepare employees for their future responsibilities.
SWP provides an opportunity to address diversity and inclusion goals by ensuring that the workforce planning process considers and supports a diverse and inclusive workforce.
It helps align HR strategies and initiatives with broader organisational objectives, ensuring that HR programmes such as recruitment, training and succession planning are directly linked to the organisation's strategic priorities.
The following seven steps are key to supporting successful strategic workforce planning:
SWP shouldn't be a HR activity completed in isolation from the business. Business leaders should own this for their area, with HR providing the support framework and amalgamated picture for the organisation. Throughout the process, leaders should be engaged and consulted to ensure their area of the business has the right interventions associated with the capabilities needed. Providing the workforce data set for their area, including market insights, and overlaying the people ambitions for the organisation, will help focus conversations and build the plan.
To underpin the direction of your talent management strategy, you need clarity on where the organisation is heading, its ambitions and business model for the future. Understanding the business pipeline and feeding this into the diagnostic element of your SWP will help you identify not just the capabilities required but also how many and where these will be needed divisionally and geographically, should this be an operating factor.
The war for talent is a continuous one. Knowing what the critical roles now and in the future are will enable you to decide whether to buy in your talent or 'grow your own' through new entrants or upskilling your existing workforce. Identify market trends and key sources of external data to feed into your SWP model.
We've highlighted some data inputs already – namely business ambitions and pipeline, as well as external market trends – but one area you must have a handle on is the makeup of your workforce:
Your data gathering exercises will help build a picture of the capabilities you'll need to deliver the business strategy now and in the future. Consider also identifying any vacancies, hard-to-fill roles and where you see capability gaps emerging.
Reviewing your employee value proposition – ‘the promise to your people’ – ensures that you can attract and, most importantly, retain your talent. Consider all aspects, from the remuneration package to the ways of working to what will ultimately make you more attractive than your competitors.
SWP is always evolving. You should review and revise planning to keep it up to date and aligned to business strategy and needs. Make sure you have a way of tracking and reporting on this to support the continued engagement and buy-in from business leaders.
Strategic workforce planning is an underrated and underinvested-in activity but one that is critical to ensure the successful and sustainable growth of a business.
Spending time upfront to design a framework that will drive the right inputs and outputs, as well as structured engagement with the business, is time and money well spent.
For more insight and guidance, get in touch with Katie Nightingale.
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