What is Workforce Planning?

The definition of workforce planning is a key part of human resources (HR) that involves looking at, forecasting, and planning for the workforce to match the business. This ensures the right people, with the right skills, in the right place at the right time. Good workforce planning helps businesses manage their people more strategically, be more efficient, reduce costs, and support growth.

In this article, we will look at what workforce planning means, the objectives, types of workforce planning, the process, the tools and software that can help and the future of workforce planning.

What is Workforce Planning?

Workforce planning is the process of looking at the current workforce, forecasting future workforce needs, and developing strategies to meet those needs. This is crucial to ensure the company has the talent to deliver its business objectives now and in the future.

The objectives of workforce planning are:

• Alignment: To align the workforce to the organization's strategy.
• Resource Optimization: To make the most of human resources by predicting and filling talent gaps.
• Flexibility: To prepare the organization for change in the business environment, such as technological advancements or changes in market demand.

HR is key to delivering workforce planning. By looking at workforce data HR can identify trends and gaps, recommend strategic actions to support the overall business strategy and help deliver those actions.

Types of Workforce Planning

There are two types of workforce planning: strategic and operational; both are part of an overall organizational strategy.

Strategic Workforce Planning

This type of planning is about long term goals and aligns the workforce to the business strategy. It involves forecasting future needs and understanding workforce demand based on business growth, market trends and technological advancements. Strategic workforce planning helps organizations prepare for big changes, such as entering new markets or launching new products.

Operational Workforce Planning

Operational planning is more short-term focused. It’s about workforce management to meet immediate business needs. This includes scheduling, managing workloads, and ensuring the right people are available at the right time. While operational planning is important for day-to-day management, it should be informed by strategic workforce planning to ensure alignment with long-term goals.

Both types of planning involve tactical elements such as looking at employee skills, forecasting turnover and identifying training needs. By combining strategic and operational workforce planning organizations can have a holistic approach to meet both immediate and future workforce needs.

The 5 Steps to Effective Workforce Planning

The workforce planning process involves:

1. Looking at the Current Workforce

This step is about looking at the size, skills, demographics and performance of the current workforce. HR use employee analytics to get insights into the strengths and weaknesses of the current workforce.

2. Forecasting Future Workforce Needs

Based on the business strategy, HR must forecast future workforce requirements. This involves forecasting the number of people needed, the types of skills required and the impact of external factors such as technological change or economic conditions.

3. Skills Gap Analysis

A skills gap analysis is a comparison of the current workforce’s capabilities against future needs. This step identifies gaps in skills, headcount, and other critical areas that need to be addressed.

4. Strategies to Close Gaps

Once gaps are identified, HR must develop talent management strategies to fill them. This could be recruitment, training and development, succession planning or changes to the workforce structure.

5. Implementation and Review

The final step is to implement the workforce planning strategies and review them regularly. Reviews and adjustments are essential to ensure the plan remains aligned with the company's goals.

Workforce Planning Tools and Software

As workforce planning becomes more complex, many businesses are turning to strategic workforce planning solutions and specialist tools to help with the process. These tools offer a range of features, including data analytics, scenario modeling, and automated reporting, which can make the process more efficient and accurate.

When choosing workforce planning software, companies should consider the following:

• Data Integration: Ability to integrate with existing HR systems and databases.
• Scenario Planning: Tools to model different workforce scenarios and assess the impact.
• Automation: Features to automate routine tasks such as data collection and analysis.
• User-Friendly Interface: An interface that is easy to use for HR professionals.

There are many benefits to using technology in workforce planning. It allows for more accurate forecasting, faster decision-making, and better alignment of workforce strategies to business goals. Plus, workforce planning tools can help organizations be more agile and responsive to changes in the business environment.

The Future of Workforce Planning

As technology advances, so does workforce planning. Emerging trends such as artificial intelligence (AI) and automation tools are changing how organizations approach workforce planning by analyzing and forecasting workforce supply and demand to ensure effective staffing and skill alignment. AI can analyze vast amounts of data to forecast future workforce needs more accurately; automation can automate many of the routine tasks in the process.

These trends have big implications for workforce planning. Organizations that adopt AI and automation will be better able to anticipate change, optimize their workforce, and stay ahead in a rapidly changing business environment.

To future-proof your organization:

• Invest in Technology: Get workforce planning tools that have AI and automation.
• Focus on Skills: Ensure employees have the skills to work with new technology.
• Stay Agile: Monitor workforce trends and adjust plans as needed to stay aligned with business goals.

Workforce Planning FAQs

What is the difference between workforce planning and succession planning?

Workforce planning is about ensuring your business has the right number of people with the right skills for the future; succession planning is about identifying and developing internal talent for key leadership roles.

How can workforce planning help with reducing turnover?

Workforce planning helps identify skills and employee engagement gaps so organizations can implement retention strategies in advance and reduce turnover.

Can workforce planning be linked to DE&I?

Yes, workforce planning can benefit DE&I by ensuring that hiring and development strategies create a diverse workforce and a more inclusive workplace.