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Seventy-nine percent of CEOs say a shortage of skilled talent is one of their top three worries. But these business leaders need not stress about the talent gap if they leverage strategic workforce planning. No matter the size, structure, or value of an organization, evaluating your workforce, identifying gaps, and planning for future needs is an excellent way to sustain growth.

What is workforce planning?

Workforce planning is a systematic process where you analyze current and future workforce needs. By ensuring you have the right number of employees with the right skills in the right positions at the right time, you can avoid workforce risks. You also need to develop a plan for overcoming current or potential skill gaps and to ensure you have access to a talent pipeline full of the type of employees you need. Aligning business goals with your people strategy through workforce planning helps to maximize profit, avoid surprises, and ensure long-term success.

The value of workforce planning strategies for organizations

Workforce planning provides a clear, concise, and data-driven direction for current and future staffing, as well as workforce development. It also identifies key skill or training gaps. Ultimately, successful workforce planning creates ongoing access to talent pipelines for filling roles as needed.

The workforce planning process

There are five stages of workforce planning.

1. Strategic Direction

Understanding the strategic direction of your organization is the first step to aligning your workforce planning. Look at challenges, long and short-term organizational goals, funding, and strengths.

2. Supply Analysis

Analyze your current workforce, by looking at turnover, recruiting sources, and workload.

3. Demand Analysis

Analyze your company’s current and projected workforce requirements. Examine anticipated changes, number of employees needed to deliver a good or service, and how workload changes as the number of employees change.

4. Gap analysis

Look at the gaps between workforce demand and supply and define top priority gaps with the greatest impact on organizational performance. Examine hard-to-fill positions or locations, looming retirements, and skill gaps.

5. Solution analysis

The appropriate workforce interventions and activities to close identified workforce gaps and enable your organization to meet its strategic goals. Leverage what you have learned to determine the areas of greatest need and develop and socialize your new workforce goals.

Tips for executing a successful workplace planning strategy

Lack of leadership buy-in is a common barrier to success. For this reason, it is important to designate leadership to manage the process. You should have HR finance, operations, and the C-suite on board.

Consider where the company is headed and the people strategy needed to get there. Remember that you should always be aligning workforce planning with the business’s overall strategic goals.

A large part of workforce planning is developing the workforce you have through internal career development initiatives, as well as ensuring you have the right team for succession planning.

Overcoming challenges in workforce planning

Below are three main challenges you may experience as you execute a strong workforce planning initiative:

Focusing on the short term

Workforce planning takes time. Consider the long game and understand that your efforts may not pay off immediately. A lot of workforce planning is preparing for gaps and trends that may not have happened yet.

Gathering accurate data about the current workforce

To ensure you fully understand your current workforce, talent and skill gaps are not identified correctly. Collect data on the demographics of your workforce and then you can make smart data-driven decisions.

Limitations of forecasting

Cloud-based, data-driven workforce planning tools can help create more agile workforce planning, but they cannot predict everything. The business environment is constantly in flux, so it is wise to have contingency plans for a variety of scenarios, especially when your predictive analytics don’t pan out.

Think Strategically

When in doubt, your business can bring in an expert. For example, Orion Talent’s HireSkills solution helps clients establish a robust pipeline with a hard-to-reach talent pool to close the skills gap. This seamless pipeline of employees is highly skilled and wants a long-term career, greatly reducing turnover and filling the gaps you have identified.

Whether you go it alone or bring in an expert, workforce planning should always be approached strategically. When executed correctly, you will experience reduced labor costs, improved retention, increased productivity, and better KPIs.

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