Talent Management: Start With A Strategic Workforce Plan -  Vistage Executive Street Blog

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Talent Management: Start With A Strategic Workforce Plan

You’ve likely heard the term workforce planning, but what makes a workforce plan strategic?

If you’re looking to improve your talent pool and bring success to your company, a strategic workforce plan is critical in today’s global economy with ever increasing talent shortages.  Leaders with strategic workforce planning skills provide a competitive edge to their organizations.

The reason strategic workforce planning is so misunderstood and sought after is because it is highly complex, requires a lot of data and the ability to analyze and explain findings to higher management.

Because of the complexity of strategic workforce planning, this post is designed to show you why it’s necessary to have a strategic plan and give you some tips on being successful.

If you don’t have a plan, developing talent management is going to be a lot harder and consume more time.

What is strategic workforce planning?

First let’s understand exactly what strategic workforce planning is. Strategic workforce planning is the purposeful process by which an organization determines the future human resource requirements needed to achieve its strategic objectives.

According to the Human Workforce Institute, “it builds upon quantitative activities, such as headcount planning and workforce analytics and uses that data as part of a qualitative decision framework that can inform and transform organizational strategy.”

It requires an understanding of the entire organization in a deep and detailed way. And in a way that can be condensed to make sense to people beyond the data. And, it requires a close connection to business strategy and planning, entails detailed needs assessments and scenario planning and typically looks out three to five years—not only the next few months, or the next year.

Why is strategic workforce planning important?

If you have proper workforce planning, a company can anticipate changes in the marketplace and the workforce, and can mobilize appropriate resources.

“A disciplined approach to this process gives an organization the ability to change more quickly than its competitors and to more effectively maximize its return on investments in talent,” write Brian E. Wilkerson with Amanda Oldridge.  “As a result, workforce planning can be the difference between a successful business offering and a missed opportunity.”

The reality of strategic workforce planning

Here are a few things about strategic workforce planning that will give you a better understanding of it in the workplace today.

  • In a study from i4cp, only 22 percent of organizations said they engaged in strategic workforce planning.
  • 36 percent of organizations engage in tactical workforce planning (staffing plans, budget reconciliation and training schedules), which typically look out no more than a year.
  • 52 percent of organizations do operational workforce planning (headcount forecasting, scheduling/coverage and staffing requisitions), which typically looks out weeks or months and is the most basic form.
  • Only 37 percent of respondents said that their organization had a person who is dedicated full-time to workforce planning as a leader.

Although these statistics are low the trend is up and more companies are increasing their efforts in strategic workforce planning. If you want your organization to succeed, you can’t take a limited view of workforce planning (or talent management as a whole). The most successful companies are continuously executing strategic workforce planning; it is not something done once a year or only looked at as an HR function.

According to Bersin and Associates research, organizations that practice advanced workforce planning had on average 28 percent higher impact scores in efficiency, effectiveness and business alignment of HR functions than their competitors who didn’t embrace strategic workforce planning.

With all the evidence that strategic workforce planning is a competitive advantage for companies, what is holding you and your company back? As you move into your next planning cycle, make sure that one of your key initiatives is to launch a strategic workforce planning process.