What is workforce planning?
Workforce planning is the process of ensuring an organization has the right people in the right place at the right time.
Workforce planning overview
Workforce planning has evolved from a straightforward operational function to an essential strategic undertaking – spanning the organization and underpinning the achievement of broader business targets. Just as in elite sports, where a fraction of a second can stand between a win and a loss, opportunities can arrive or vanish quickly in today’s volatile business climate. Powerful and streamlined planning solutions can help you analyze, understand, prepare, and predict. When you can see around corners, you can get a competitive edge that helps you stay one step ahead.
Workforce planning definition
A definition of workforce management must consider the changing world of work. A recent joint study from MIT and Deloitte shows that now, remote and contingent workers make up approximately 30% of many companies, rising as high as 50% in tech and some other sectors. Shifting social and cultural trends are also having a huge impact on the definition of modern workforce management. At its core, WFM is a comprehensive and integrated set of processes and tools that help in planning, managing, and tracking employee work, including time and attendance, employee scheduling, and compliance with labor laws. But today, WFM practices and solutions must also provide resources that help adapt to changing lifestyles, expectations, and the wellbeing and engagement of your workforce.
A strategic workforce planning approach
In just the past few years, we’ve seen leaps and bounds in computing and software technology, from instantaneous cloud connectivity to the rise of machine learning and AI-powered solutions. We’ve also experienced an overwhelming shift in workplace patterns, with a recent academic study predicting that by 2025, up to 70% of U.S. office workers will work remotely at least five days per month. On the societal and environmental front, we face increased cultural polarization, volatile economies, fast-changing consumer behaviors, and a rise in major weather and climate events.
For your company, any one of these trends could represent a range of risks and opportunities. When you add them all together, it can become pretty overwhelming. It’s no longer enough to simply “recruit and retain.” Today’s organizations need to augment operational workforce planning processes with a more strategic future-oriented approach to navigate these many modern challenges. This involves aligning recruitment and talent management strategies with business objectives and targets. Strategic workforce planning is built on defined goals, good communication, and dedicated software solutions. It proactively addresses talent gaps, fosters equity, supports efficiency, manages succession planning, and optimizes workforce allocation.
Practical benefits of workforce planning
The success of any HR organization is measured by both operational achievement and the development of an ever-improving workplace environment. Workforce planning solutions can help you meet these twin goals by optimizing some of your core HR activities.
Closing talent gaps: By assessing future talent needs and analyzing current capabilities, your HR team can both identify and address talent gaps and establish relevant strategies for recruitment, training, and development. This helps ensure you have the right talent in place when needed.
Scenario planning for future resilience: Scenario planning offers a no-risk means to explore and prepare for a variety of potential situations, virtually. This supports preparedness and resilience. It also allows your teams to develop a viable set of contingency plans for fast and effective responses to a wide range of disruptions and opportunities.
Enhanced productivity: By optimizing staff and talent allocation, workforce planning processes help ensure your employees are working at tasks that maximize their skills and potential. By aligning workforce capabilities with your long- and short-term goals, you can enhance overall productivity and performance.
Risk mitigation: Supply issues, talent shortages, and various other disruptions can lead to risk and loss. Workforce planning processes and solutions can help you minimize these threats by supporting scenario planning, predictive recruitment, and the ability to integrate workforce-related information across departments in real time. This means that when risk comes along, you can respond and adapt, rather than react and panic.
Cost savings: Workforce planning supports more efficient staff allocation, making sure you don’t over-hire or under-hire. It also helps minimize recruitment red tape and costly delays in onboarding. Productivity and efficiency can be boosted by ensuring the right skills are in the right places and by offering data-driven guidance to tasks and repetitive jobs that may be optimized through automation.
Workforce agility: Market shifts that once took months or years can now happen in days. Some skills become obsolete almost overnight, while the need for others emerges just as rapidly. Today, you must be able to upskill and reskill your people on demand and ensure your HR teams have a cross-business, eagle-eyed view of all your changing staffing needs and business models.
The role of workforce planning tools
The 16th century military strategist Takeda Shingen once said: “Knowledge is not power, it is only potential. Applying that knowledge is power.” And that sentiment applies 500 years later, when departments all across your business gather and store all kinds of valuable knowledge and data, then let it sit in isolation. When useful cross-business data is analyzed, applied, and integrated, then and only then, can it help empower your HR operations.
The best workforce planning solutions bridge silos to offer a more complete perspective. Harnessing the power of AI, the solutions can help you anticipate future talent needs, optimize workforce allocation, and align workforce and business objectives. With integrated information from across the organization, your HR team is empowered to deliver faster insights and make more confident decisions.
Strategic workforce planning in action
Today’s HR teams have many complex responsibilities. Strategic workforce planning solutions can help support and optimize these responsibilities in a variety of ways:
- Managing rapid growth: Workforce planning software can forecast the number and types of roles that will need filling. By accurately predicting talent needs, you can build an economical strategy for recruitment and training, based on predictive analytics.
- Ensuring equity in the recruitment process: In the past five years, the number of workplace lawsuits has risen dramatically, with the bulk (and most expensive) of those cases being related to issues of equity and diversity. Workforce planning solutions have the capacity to analyze workforce data, report potential risks, and offer recommendations for compliance.
- Addressing high employee turnover: Between anecdotal input and social media hyperbole, it can be difficult to understand the source of your turnover issues. Workforce planning tools can help amalgamate and analyze structured and unstructured data sets and employee feedback to deliver insights and suggestions to improve employee retention and employee satisfaction.
- Simplifying succession planning: When valued employees leave your company, it can be stressful and politically prickly to fill their shoes. Workforce planning solutions are great at getting an objective and unbiased measure of both internal and external candidates to help ensure you make a choice that’s equitable for your teams and beneficial for your business goals.
- Managing seasonal workforce needs: Some temporary staffing needs are seasonal and predictable, whereas others may be a result of a product launch or an unexpected trend. Either way, by accurately planning for seasonal variations in demand, you can minimize labor costs and maximize operational efficiency.
- Maintaining competitive salaries: With the secretive nature of salary details, it has traditionally been difficult to get an accurate sense of going rates in different sectors and roles. Workforce planning solutions are able to curate and analyze disparate data sets from both internal and external sources to give up-to-date and accurate salary estimates.
- Ensuring compliance: Workforce planning tools can access, store, update, and compare a variety of data on labor laws, regulations, quotas, contracts, and other compliance requirements. This includes regionalized settings to help ensure your global operations are equally protected.
- Developing effective training programs: In order to develop the most accurately tailored training programs, it’s necessary to know what you most urgently need to train people for. By identifying skills and knowledge gaps, workforce planning helps your HR teams develop training curricula on demand to best meet the real-time needs of your people and your operations.