The key to workforce planning and hiring productive employees

Introduction

The goals of any successful workforce planning strategy touch upon all aspects of employee experience. To sustain growth and increase revenue you must keep top performers and attract new talent. So any initiatives that increase engagement while maintaining wellbeing should be included in your workforce plans.

In this article, we discuss:

• Why workforce planning is important
• Companies with successful workforce planning strategies
• How to create a workforce plan
• The stages of workforce planning
• How to maintain engagement

Why is strategic workforce planning important – what are the benefits?

Simply put, strategic workforce planning is the process of balancing the needs of your organisation against your current or future workforce. It's an incredibly important analysis because salary spend is likely your largest expense.¹

If you’re spending too much on wages, but aren’t getting the output you need to drive revenue, this will decrease your profit margins. Alternatively, if you’re spending too little, you risk employee burnout and stunting business growth.

Striking the right balance between filling workforce gaps and ensuring you’re not overstaffed can be tricky. But when you get it right your organisation will experience numerous benefits, including:

• Achieving financial objectives: When HR teams are in alignment with the finance department, they can better identify workforce gaps and recruit the right people at the right time. This means you have enough employees to grow your organisation and revenue.
• Improving employee experience: Accounting for future demand and drawing up a strategic workforce planning process prevents unnecessary stress. Additionally, anticipating your employees’ goals in times of growth should also be a priority if you want them to develop and mentor new hires.
• Increasing retention rates: Understanding who drives the most revenue, but is also at risk of resigning means you can focus retention strategies on these specific top performers. Moreover, using data in this way reduces managerial biases, so the same employees don’t keep receiving raises and incentives. Unless, of course, they’re top performers.
• Greater collaboration: Including different departments in your workforce planning naturally promotes a more collaborative culture. Encouraging finance to work with HR and employee experience managers builds stronger working relationships and additional cross-departmental insight.
• Higher levels of job satisfaction: When you have an accurate workforce planning strategy it could free up more investment for training. Reinvesting money in your employees' development keeps motivation and engagement high – both of which are crucial components of job satisfaction.

Companies with effective workforce planning practices

At the centre of every strategic workplace planning practice is well-gathered data. But that’s not all, data is only useful when it’s acted upon. And the following companies understand that taking action is just as important as analysing the figures.

• Oxfam: Oxfam know they can’t compete with the private sector in terms of salary and financial incentives. But what they do well is funnel their spending into training and development. By doing this, they don’t waste precious resources on recruitment. Instead, they focus their spending on initiatives that promote employee retention.
• Prudential: Prudential prides itself on its inclusive comms strategy. Every employee hears about the highs and lows the organisation experiences. Additionally, they also understand that HR processes change with time and that adaptation is important. This is what keeps them ahead of other similar corporations.
• Alliance Boots GmbH: Or Boots, understand the importance of employee wellbeing. They put everything into making their work environment as stress-free as possible. Their employee-engaged philosophy keeps turnover low and helps them reinvest back into training and community-driven programmes.
• Sainsbury's: Sainsbury’s operates on tight margins, consequently it’s crucial their workforce planning is accurate. Nevertheless, every penny saved in employee overheads is reinvested back into the company. In fact, their HR department was the first to develop self-service checkouts. With more employees working on stock replenishment than tills they were able to get more items out without overloading their teams.
• BT: BT have the advantage of being a communications provider, so they excel at keeping their team up-to-date with the latest news. However, their real strengths lie in their flexible working policies and apprenticeship schemes. Investing in their teams saves them money overall as they spend less on recruitment and have access to a wealth of homegrown talent.

How to create a strategic workforce plan – actions to consider

When you’re creating a workforce planning process, you should:

Put together a cross-departmental team

To create a successful strategic workforce plan you need insight from several departments. All information should funnel into HR and finance teams, as ultimately they’ll be taking the lead. But it's important not to neglect input from other senior leaders in different departments.

Build a plan around your business strategy

To do this, you must first understand the state of your workforce, and no we don't mean you should just record headcount and salaries. You need to take a more qualitative approach. Understanding your employees’ skill sets and qualifications will help you see where they’ll fit in your future plans. And also highlight any skill gaps.

The six stages of workforce planning

The process of workforce planning can be broken down into six stages. Each stage must be completed before moving on to the next.²

1. Strategic direction

To develop a solid strategy you must first identify your goals and objectives for the future. Only then, should you begin to think about how you will achieve these goals with your current workforce.

Questions you should consider asking at this stage are:

• What organisational-wide changes are we expecting to make over the next 3–5 years?
• What short and long-term goals do we have in mind to get there?
• Will we need to change any policies?
• Will any future changes in legislation affect the business? For example, how we store and use data?
• Do we think our revenue is likely to remain stable?

2. Workforce analysis

The purpose of the workforce analysis is to measure how much your current workforce is set to change and if it meets your plans for business growth.

Questions you should consider asking at this stage are:

• Is our current workforce aligned with our business strategy?
• How many employees do we have at each organisational level?
• Will reducing employee count affect output?
• Can we move other employees into different positions?
• Do we have the scope to provide training opportunities?

3. Demand analysis

A demand analysis will highlight what the current workload is on your organisation and how it could change in the future.

Questions you should ask at this stage are:

• What is putting the most workload on the organisation?
• Does the workload differ between departments?
• How will future changes in technology affect this workload?
• How many full-time workers do we need for the current and future workload?
• Are there any opportunities to enhance current resources?

4. Gap analysis

When you detect gaps in your organisation, it suggests your speed of growth has resulted in an imbalance of skill sets. A good example of this is when a company has moved into the e-commerce space but lacks a digitally focused team. This analysis is also crucial to industries that tend to have high turnover rates.

Questions you should ask at this stage are:

• What gaps or skills are missing in our current or future workforce?
• How are we going to recruit for these skill sets in the future?
• Does our location make it difficult to recruit people with the skills we need?
• Do we have gaps in diversity?
• Will retiring employees leave gaps in the workforce?

Maintaining your workforce plan

You should actively maintain your workforce plan if you want results. It’s sometimes easy to sit back at this point as the planning and preparation stages are over. However, you mustn’t fall into this trap of complacency. You should put just as much work into maintaining your workforce plan as developing it.

Actions you should be taking throughout this maintenance phase are:

• Supporting managers: You should be checking in with any managers who are affected by the workforce plan. Do they have all the resources they need? What do their direct reports think about the changes? Asking these questions will give you insight into how your plan progressing and reveal any pain points. Consider setting up monthly meetings or lunches to discuss progress.
• Refining your evaluation criteria: You may find as you complete objectives some metrics aren’t relevant anymore. In these instances, you should remove unnecessary data points as this could put a strain on your plan. Remember your plan needs to be agile. So a big part of the maintenance phase is deciding what data are most relevant to the strategic objectives you’re working on.
• Organising your data and making it accessible: Data including, information on new joiners, leavers, and retirees is a snapshot in time and you can correlate it against your workforce plan objectives.³ Consequently, it needs to be easily accessible to the analysts that need it. If this information is hard to come by this will slow down a lot of processes and make your plan less agile.
• Paying attention to changes in company culture: Now, these changes may be positive or negative depending on what you’re implementing. If you’ve come to the difficult realisation you need to make redundancies this will temporarily reduce engagement. Alternatively, if you’re expanding, morale and job satisfaction will likely be high as you promote employees into new positions and take on new joiners.

Maintain employee engagement with great tools

When you have the right people in the right place, your top priority should be maintaining or increasing engagement.

In fact, most companies who want to boost retention, usually focus on engagement strategies to keep morale and loyalty high.

Obviously, engagement objectives will vary between companies as each have different budgets. Usually, though, organisations find all-in-one employee experience solutions very cost-effective as everything they need is in one tool.

Perkbox, for example, contains a range of features that address all areas of engagement. Not to mention it has over 9,000 deals and discounts worldwide with the biggest brands.

Plus with an ever-expanding wellbeing library of on-demand workout videos, yoga flows, and soothing sleep stories, it has everything your teams need to stay happy and healthy.