If the last 18 months have taught us anything, it’s that the future is tricky to predict. From a talent perspective, employers are increasingly rethinking and resetting their management, performance and workforce strategies to ensure they are fit for purpose in this new era. One of the key areas of focus for many businesses is the implementation of a robust strategic workforce plan.
Workforce planning helps identify your talent needs, what capability you have in your current workforce, and what talent is needed to fill the gaps. Demand planning is often misinterpreted as the same thing, but this essentially looks at current needs rather than future needs, therefore creates a reactive response.
Having the right skills in the right place at the right time sounds simple. However, there are added layers of complexity when considering the cost of resources, whether you have the right blend of skills (management, technical vs other), and if there’s flexibility in the workforce, e.g. hiring too many permanent employees with an unstable pipeline of work could prove to be costly.
To predict what resources you are likely to need both short (1 year) and long term (1-5 years), organisations must combine manager insight (what does the business think it needs?) with budgetary considerations and market trend analysis, including benchmarking data from other organisations. The more informed your planning is, the easier it is to maintain flexibility and mitigate associated risks.
Start the process by addressing the following questions:
- What skill-sets and mindsets do we need to continue to operate, grow and evolve?
- How can we augment our sources of talent to position our business to meet future needs?
- Where will we go for rapid access to skills if critical talent is unavailable?
Armed with this information, you can explore the different approaches that forward-thinking organisations take to estimate future workforce requirements, including:
Asking the right questions. Speak to leaders at all levels to get their thoughts on the skills, experience and behaviours they think will be needed in the coming weeks, months and years.
Establishing a budget. Embarking on skills forecasting is one thing, but can you afford to take on additional talent, or do you need to explore upskilling options for your workforce? Start by working out your cost per employee to establish how many people you can afford to employ right now.
Identify positions key to business performance. Highlight any positions that directly impact current operations and would negatively affect the day-to-day running of the business if they were absent.
Define job families. Typically employees working in roles belonging to the same job family require similar competencies and therefore need little training to perform one another’s positions should they need to.
Trends and forecasting. Some organisations operating in industries with longer product/service cycles or where technology is not changing too rapidly can effectively forecast by looking at past increases in productivity and assuming such trends will continue. It’s worth considering that this is a broad-brush approach to planning and any forecasts are only assumptions.
Zero-based demand estimation. Like zero-based budgeting, this approach requires businesses to look at what is needed now rather than basing decisions on historical results and piecemeal data. Particularly useful during periods of disruption, zero-based demand estimation is informed by a combination of the methods above to help unlock new thinking about work design, productivity, and flexibility.
Invest in technology. When it comes to gaining insights to help inform a future talent strategy, demand forecasting and recruitment technology can deliver significant value. Combined, they can provide transparency as well as help organizations benchmark best practices, identify trends and highlight early warnings of any talent gaps and performance issues.
External partnerships. For in-house TA and HR teams, accessing and analyzing the data required to develop effective strategic workforce plans can be overwhelming. Additionally, many don’t have the latest technology needed to mine, collate and present such data to key stakeholders. It’s why an increasing number of organizations are turning to resource specialists who will bring the expertise needed to effectively and strategically predict future talent needs.