why workforce plan

Why would you do Workforce Planning

Why plan?

For some, the hurdle to get over is the challenge of planning. Why would you plan anything, rather than simply respond to the market? There are four key reasons for planning1:

  • Organisations must plan to coordinate their activities – there are things you want to do as a business, planning ensures you have everything in place to do that.
  • Organisations must plan to ensure that the future is taken into account – the future is uncertain, planning helps you take full consideration of the risks and opportunities over the coming years.
  • Organisations must plan to be rational – it’s easy to make a decision, it’s much harder to do so in a way that you are assured that all the factors have been considered. Planning takes a systematic approach to inform effective decisions and helps minimise bias and noise that may be damaging to success.
  • Organisations must plan to control – businesses that want to protect themselves ‘careless, costly, or uninformed decisions or behaviors’2 must exercise control. Planning enables organisations to execute knowing that they have all the controls in place to mitigate risks.

Why workforce planning?

Ok, so we’re happy that planning is important. But why is it important to plan the workforce? The workforce is typically the biggest cost within an organization; typically 70% of operating expenses within large organisations3. If you accept the premise of planning, the logic follows to make plans for the largest cost base: the workforce. That said, let’s look at some of the specific benefits.

Guiding the business forward to success

‘A business strategy cannot be executed without the available skills and capability in the workforce’.4 Workforce planning is critical to guiding businesses towards their objectives by connecting strategy to execution, with a robust strategic workforce plan providing:

  • 'A plan which maintains focus on strategy
  • A year by year action plan that executes that strategy
  • Avoidance of bad tactical decisions which could result in long term problems
  • A degree of preparedness for unforeseen situations
  • A securing of core jobs and key skills’5

Providing business insight

Whilst two-thirds of CEOs received basic metrics from their HR departments, just 24% said they also received analytics that ‘connect their people metrics to business metrics’.6 The ability to connect the two hinges on workforce plans that link capability to successful business outcomes.

Becoming Resilient and Antifragile

Events such as the global financial crisis and COVID-19 pandemic have demonstrated the fragility of businesses, economies and nations; with the increased acceptance of a VUCA world, organisations are increasingly sensing their fragility and looking towards building resilience and going beyond that to the point of antifragility7. Effective workforce planning is geared towards building resilience and antifragility, considering multiple scenarios for the future. We plan based on the most likely scenario, ensure there is contingency for the worst case and build in the agility to respond to the opportunities of a best case.

Overcoming prevailing trends

Notwithstanding the challenges of a VUCA world, businesses are facing a number of prevailing trends that workforce planning can mitigate and overcome. Whether it’s the challenges of managing a multi-generational workforce, improving diversity and inclusion, understanding the opportunities and impact of automation, overcoming the skills gap or finding a way to tackle stagnant productivity, all of these can be solved through effective workforce planning.

Boiling it all down

Fundamentally workforce planning is about ensuring an organisation has the right capability to achieve its business objectives. Firstly, workforce planning helps businesses work out the best possible way to create and utilise the capabilities they need to be successful. Secondly, and perhaps more importantly, workforce planning provides the opportunity of choice. We can all look at business challenges and thing that we should have done x or y instead. We see businesses that have to take drastic action, major layoffs or hiking their pay budget to hire scarce skills. We know that these businesses did not set out to do this, they are simply responding as best as they can to a crisis. Workforce planning considers these things far enough in advance to allow you to reskill and redeploy the workforce to avoid layoffs, or to invest in learning and development to build scarce skills.

If you’re not sure, think about the workforce challenges you’re dealing with right now? How much of that would not be an issue had it been considered and planned three years ago? Give it a go!

workforce planning adam gibson
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