Stated very simply, the key to successful workforce planning is making sure your organisation has the right people available for the right roles at the right time - so the right things get done.
Yet, while this is arguably the most critical business issue many companies face, it is one that they often - unfortunately - get wrong. That is because so many companies fail to understand that workforce planning is an issue of future supply and demand.
Organisations tend to focus significant time and energy on understanding the workforce supply - internal demographics and performance, external labor markets, etc. - and not enough time identifying workforce demand.
What's at the heart of the issue? Forecasting workforce demand means understanding the critical people requirements (critical roles and competencies) of your organisation's three-to-five year business plan and the external factors (political, economic, labor market, educational trends) that will impact your ability to achieve the plan.
Workforce demand starts with a detailed analysis of internal and external market conditions. Multiple and complex factors obviously weigh into this. Some questions a company needs to ask itself in assessing demand include:
- What sales should we anticipate?
- What productivity should we expect?
- What parts of the business may be expanding or contracting?
- What new products are being launched?
- What processes may be streamlined?
- What is the impact of new technology?
- How may mergers and acquisitions impact the business?
- How will the government regulations impact the organisation?
Once this type of information has been collected, the company needs to determine the organisational capabilities that are required to meet business objectives, and how these organisational capabilities translate into critical roles and talent requirements. While this will vary from company to company and industry to industry, a few basic action steps include:
- Analysing the company's business plans and trends that will impact the business in the future
- Identifying critical capabilities for executing the business plan
- Defining roles and responsibilities critical to achieving business objectives and preparing for external market factors
- Developing underlying competencies for these pivotal roles
Conducting a diligent analysis of the organisation's business strategy and linking critical roles and competencies directly to that strategy is, no doubt, a rigorous activity, but one that will better prepare your organisation to meet future demands.
Once this is completed, you can turn to the other side of the workforce planning equation: identification of internal and external talent supply. This disciplined, holistic approach will allow you to identify and address critical gaps that are at the crux of successful workforce planning - the intersection of supply and demand.