People are the real unique strength of every organization - and that's why workforce planning has the potential to add so much value. Learn how in our guide.
Business leaders and consultants will often comment that people are the biggest expense any business has. And, from a balance sheet perspective, that’s one way to think about it.
Another perspective is that people are your best investment. Not only are people the main generators of revenue for your business, but they are also:
This is why investing time and effort into deliberate workforce planning is always worth it.
The question is: what exactly is workforce planning, and why do you even need it? Are there specific steps you should be taking to plan and optimize your people resources?
This guide answers all this and more as we dive into:
Workforce planning is an umbrella term for managing, analyzing, and optimizing human resources, making sure you have the right people with the right skills to meet your business goals.
It goes beyond managing workloads and resource allocation as you focus on analyzing your current resources, forecasting future demands, identifying resource gaps, and implementing employee development and retention strategies to create an engaged workforce.
Moreover, it’s an all-in process that demands strategic thinking and works in cycles.
Lack of thoughtful workforce planning often leads to excessive overhead costs, overworked and burnt-out employees, high employee turnover, and a growing poor reputation for the company as word gets around that it's a chaotic place to work.
Thankfully, with strategic workforce planning in place, companies can unlock success, improve productivity, and boost employee retention, among other benefits:
For workforce planning to deliver its best results, you need to first get to grips with the key principles guiding the process. Here’s a quick overview — remember, you’ll need to get these core pillars in order before seeing any success with workforce planning:
It’s often easy for project management to get a seat on the table. Resource management and strategic workforce planning? Not so much, despite its benefits of cost-saving and optimization initiatives.
This means for workforce planning to succeed, a solid starting point is leadership buy-in and stakeholder investment in the importance of effective workforce planning.
Effective investment here defines how much authority and independence workforce planning gets within the organizational strategy and overall goals.
Want to dig deeper? Read our tips on How to get leadership buy-in for resource management ➡️
Next, strategic planning relies on data-informed decision-making to account for both internal and external factors. This takes collecting, gathering, and regularly studying workforce planning metrics that can help you make informed decisions and reliable calculations.
Among other things, you need to be looking at:
Unfamiliar with some of these terms? Bookmark this handy reference sheet ➡️ our Resource Management Glossary 📕
Last of all, an equally important workforce planning pillar involves proactively hunting down inefficiencies.
Essentially, the strategies falling under workforce planning always have at least something to do with uncovering inefficiencies, optimizing processes, and maximizing revenue.
In fact, there are many workforce planning models out there, but whatever your project or business is, you are highly likely to go with an optimization model. These models are all about eliminating inefficiencies by reducing staffing costs or increasing project outputs while working with the same pool of resources.
So as you plan your workforce, you’ll generally find yourself trying to identify constraints to find more profitable resource allocation scenarios that help people be more productive without clocking in more hours.
As we get closer to the actual workforce planning process, let’s also look into potential challenges you’ll likely encounter. The aim here is simple: to help you remain agile and look into the potential traps lying ahead.
Here are some impactful challenges to consider:
Even though remote work and gig culture have opened doors to hiring a talented workforce, there’s still a very tangible shortage of skilled personnel across seniority levels, skills, and, most importantly, availability to take on new projects.
As a result, you’ll find your time-to-staff resource management metric low when planning for skills. And the opposite is how you overcome this challenge — improving your time-to-staff by:
The growing demand for flexibility is constantly shifting workplace expectations (and for good!). Folks are increasingly:
And so, to attract top talent, your workforce planning strategy needs to account for this changing trend.
Put simply, you're competing for the best people, and the best people are going to go for the best offer. In today's employment landscape, you need to offer roles that complement rather than restrict candidates’ lifestyles.
Automation and AI are already growing at full throttle, and they’ll only see an upward growth trajectory from here.
To this end, certain skills might become obsolete or need to be adapted in the near future as they are augmented or even replaced by automation tools.
If you look at this through the prism of workforce planning, this means you’ll want to refrain from hiring people for the skills that might become redundant within a short time.
The aim here is simple - you don’t want to deal with unnecessary or easily preventable overhead costs or staff that needs to be retrained or upskilled before you can actively use their time for new initiatives.
Effective workforce planning relies on several resource management metrics that, in turn, depend on tracking, gathering, and maintaining data (data governance). Meaning: if you aren’t vigilant with data governance, you won’t be able to drive the most return from workforce planning.
The solution, you ask? Proactively gathering and tracking essential project- and resource-related metrics, including having relevant teams monitor data and using a single source of truth for all data tracking and review.
Easy-to-use resource management software helps teams:
Despite the benefits a tool can offer, though, some organizations might prefer the old ways — meaning that it becomes a challenge for the relevant teams to convince the C-suite to invest in the needed software.
Your action plan should revolve around first getting buy-in for resource management software (starting with making a comparative base between a central tool and spreadsheets), then finding the best resource management tool for your organization.
It’s unusual for an organization to have a dedicated workforce planning team. As a result, in many cases the HR department will be leading workforce planning initiatives within an organization, or will at least have a large role to play in it.
If your organization has a dedicated resource management department though, this will be the one leading workforce planning. This will include planning everything from size and cost to agility and relevance of past, current, and future workforce.
That said, senior management and the C-suite may wish to dip their toes into workforce planning whenever they build the overarching organizational strategy.
A workforce planning process is a step-by-step path you take to analyze and optimize the use of the company’s workforce to hit long-term objectives.
It involves strategizing and implementing ways to maximize the potential of existing resources as well as enriching the talent pool with hires that are most relevant, sustainable, and committed to the company.
Essentially, it is this planning and analysis that helps organizations gain clarity on how they are going to reach the desired growth and market share expansion.
Here’s a detailed guide on how to do effective workforce planning processes, but the headlines are:
There's no doubt that workforce planning comes with a fair share of complexities, but there are also a lot of tried and tested things you can do to improve your workforce planning process.
External and internal environments play a leading role in just how sustainable and reliable your workforce plan turns out to be. They can impact your workforce’s needs, wants, and expectations, as well as the things your organization can expect from them in return.
Thankfully, doing regular environmental scans to gain a tight grip on the potential areas of influence will take you many steps closer to a long-lasting workforce. To get started, ask yourself:
It's very common for resources to move both vertically and horizontally within a large organization (technically called career pathing). Even more, this internal mobility and succession are an integral part of employee retention, satisfaction, and loyalty.
When people see no future or career growth opportunities within their company, they are a lot more likely to move on sooner rather than later. And even though many look at this as a threat, it's a great asset — if you anticipate it in time to do succession planning.
For example, if someone will be retiring or going up the ranks in the coming years, that gives you enough time to find the best replacement within the organization.
Not only does it cut hiring costs, but it also gives you adequate time for upskilling the people that are already great for the role. Not to mention the impact this will have on people feeling recognized for their potential and invested in their future with the company.
Scenario planning helps you anticipate the different ways your workforce plan could play out. It's also a great way to group and synthesize all the information you have managed to accumulate about your past, current, and future workforce needs.
It gives you a chance to take a moment to designate those 'what-ifs' and see how they might impact your resources, their capacity, and the business overall, with enough time to build backup plans should you ever need one.
So how do you go about planning scenarios in real time? Use Runn’s people and project planning features.
Using them, for example, you can model how various project workload scenarios will impact different teams and individuals within the company ahead of the work commencing. In turn, allowing you to see which roles are likely to be under pressure months before the rubber hits the road.
An increasingly volatile economy, evolving consumer needs, and AI and automation are rapidly changing the job market.
Although, on the surface, this might sound like a challenge to wade through, it’s actually an opportunity in disguise — an opportunity to be ahead of the competition and drive the change rather than tag along with the ones initiating it.
Put simply, this means you need to anticipate what roles will become less necessary and which roles will gain momentum, along with the skills people need to do them. Hiring that type of workforce or, even better, training it early on once again means grabbing a front-row seat in any industry.
A great place to start is by performing a skills gap analysis for your organization, to see where your workforce is standing in terms of their current skillsets and competencies.
Thankfully, For a bird's eye view of skills, Runn gives you the ability to keep a skills inventory and see everyone's expertise, seniority levels, and the potential they have to upskill themselves (and even to help coach others).
The more people you have, the more data there will be. Time, skills, availability, capacity, wants and needs, time-off, individual requests — there's always more data that you can track.
Not to mention the web you will end up spinning when you have hundreds if not thousands of resources.
But, with reliable workforce planning tools on your table, managing all this data ceases to be a pipedream and becomes a very achievable (not to mention, user-friendly) reality.
In a nutshell, remember that:
