Categories: Real Estate Resource

Workforce Planning: Definition, Benefits, and Steps

Workforce planning can help you meet organizational goals in any economy. It’s been a challenging couple of years for HR. Fortunately, with COVID slowly coming to a halt,

businesses big and small are finally returning to normal. For many organizations, the new normal implies dealing with the consequences of pandemic layouts, remote work, and talent gaps.

Senior businessman employee working in the office

During 2020, the first year of the pandemic, at least 89% of US organizations have managed to integrate workforce planning with business planning, despite tremendous challenges. However, only half of these organizations – some 54% – have reported a successful integration.

So, how do we stand in the post-COVID world?

Is workforce planning more effective today than it was a few years ago?

Before we try to answer this question, let’s take a look back at some core principles of this HR practice and its many benefits for employers and employees alike.

What is workforce planning?

Workforce planning is a complex process that includes many aspects of HR. In practice, the extensive workforce planning process steps reflect the three main activities in HR – recruitment, retention, and training, as well as organization-specific sub-processes and variants.

As a combination of analytics and strategic planning, this practice helps organizations pinpoint current and future needs and plan their workforce accordingly. It relies on employee tracking and workforce analytics to provide actionable data and inform critical HR strategies.

In most organizations, workforce planning is crucial for:

  • Assessing employee performance daily;
  • Discovering current and future talent gaps;
  • Improving employee management procedures;
  • Defining staffing requirements for the future;
  • Developing cost-effective recruitment strategies.

Organizations employ strategic workforce planning to attain long-term employment objectives through succession planning and risk management.

They can also employ operational workforce planning to solve staffing problems and meet short-term objectives.

In either case, the end goal of this practice is to align staffing needs with plans for the future.

What are the main benefits of workforce planning?

Organizations apply different workforce planning process steps depending on their industry requirements, the number of employees, and specific staffing goals. Still, the benefits of this practice are huge for all businesses. Here are several primary benefits.

Identifying knowledge gaps

Employee tracking and workforce analytics are integral parts of the planning process. In addition to other benefits, they help organizations identify current bottlenecks and define talent gaps they must close.

This insight is crucial for building a knowledgeable workforce.

Improving retention rates

Employee retention can save your organization from significant productivity losses. Workforce planning is also helpful in this aspect, especially as it gives you the data you need for matching talent with roles. Instead of firing people, you can analyze their skills and redeploy them.

Boosting daily productivity

The sense of completion and fulfillment that comes from excelling at work is enough to retain the best talent and skyrocket productivity on an everyday level. However, to light this spark in every employee, you need to hire them properly, track their progress, and apply their skills.

Building a strong foundation

Spot-on hiring decisions, appropriate retention tactics, and effective succession planning contribute to stronger organizational foundations. The ability to identify and solve talent gaps in near real-time builds organizations that are agile and ready for the future.

The workforce planning process in 5 steps

The five significant workforce planning process steps are:

  1. Setting attainable workforce planning goals;
  1. Analyzing the current state of your workforce;
  2. Developing a plan based on goals and data;
  1. Integrating the workforce planning process;
  1. Monitoring results and improving accordingly.

We’ve already discussed the importance of goal-setting for future growth, and we won’t get into that in more detail. Analyzing the current state of your workforce requires a skilled HR team and appropriate tools. For this, most organizations use headcount planning software.

In addition to talent gap analysis, the second step includes demand planning and internal supply.

Demand planning helps determine the quantity and quality of people that your organization will require in the future. Internal supply in HR refers to current members of your organizational workforce whom you can retrain, promote, or reemploy to meet future objectives.

Developing a plan and implementing workforce planning requires some restructuring. Your HR team must be able to readjust and manage new responsibilities and vet and integrate the right technology for tracking, analyzing, and evaluating the current workforce.

Throughout this process, HR must tick the following boxes:

  • Get the correct number of employees necessary for achieving your goals.
  • Define the best combination of skill sets, expertise, and experience.
  • Set the proper hiring budget according to expected ROI rates.
  • Develop agile frameworks for recruitment, retention, and training.

Varying from one organization to another, workforce planning at this stage usually includes strategies for onboarding, outsourcing, and deploying new technology.

Bear in mind that workforce planning is a continual process, so don’t expect to see any results overnight. The final step, which is monitoring results, will keep sending you back to planning and integrating until you fine-tune and set your workforce planning process for the future.

Conclusion

So, is your organization better equipped for workforce planning than before COVID?

It’s a good question when considering the complexity and long-term commitment that this practice requires, especially in today’s weakened economy. The answer is right there, too – if the general hiring climate were any better, you wouldn’t need workforce planning.

These are uncertain times, but planning can add some clarity.

Jamie Richardson

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