Workforce Planning, its importance and types
Workforce planning decoded along
Workforce planning refers to the continual process of planning various workforce-related activities in the organization. The main aim behind conducting workforce planning is to align the organization's needs with the needs of staff members in the organization. Also, workforce planning is conducted to ensure that all obligations, regulations, and legislation relating to the workforce comply within the organization. Further, workforce planning is conducted to analyze the skills needed to be present in staff members and the number of staff members required. This further helps define the skill gap in the organization and helps in defining the number of staff members required to be hired at the workplace. Along with this, workforce planning is the key to ensure that the right persons are hired at the right job and at the right time in the organization (Workforce Planning, 2019).
This article mainly focuses on the concept of workforce planning and different requirements related to it. Apart from this, different components related to workforce planning are also elaborated in thus article that can help the organizations in implementing HR practices in efficient way. This article is also very useful to understand the importance of workforce planning in efficient way.
Workforce planning fit:
Workforce planning is needed to be conducted in every organization, and it is a must to ensure that workforce plans are aligned with the business plans. Also, workforce planning fit depends on the extent to which workforce plans are incorporated in the business and financial plans of the business. The following figure shows the workforce planning fit:
The above figure helped in identifying that HR strategies are developed after preparing organizational behavior and strategies. Also, it has been identified that HR processes involved in HR planning are recruitment, selection, performance management, learning and development, rewards and promotion, etc.
Components of workforce planning:
Workforce planning helps in implementing several HR strategies in the organization. The main components or steps of workforce planning include a review of the current workforce, forecasting the needs for the future workforce, and developing strategies to avoid workforce issues to be faced in the organization. The following figure shows the main components of the workforce planning cycle:
The above figure helped in identifying that workforce planning helps in identifying gaps in the current workforce of the organization and helps in developing strategies for reducing workforce gaps and current challenges.
Importance of workforce planning:
Workforce planning helps in providing managers with the base for taking various human resource decisions in an organization. it is one of the important business planning tools that helps in managing various workforce-related risks and achieving the best business outcomes (" The importance of workforce planning," 2019). The above section of the report helped identify that workforce planning is useful not only for identifying the gaps in current workforce plans but also helps in identifying the gaps in required competencies for the future. The process of workforce planning helps in defining various HR strategies for mitigating workforce risks. Along with this, strategic workforce planning is needed for running business smoothly in the competitive business world. The following points highlight the importance of conducting workforce planning in the organization:
Analysis of current and future workforce:
The workforce plan also helps analyze the current workforce supply in the organization by analyzing the current workforce profiling and evaluating the skills and capabilities of the workforce. The workforce plan also includes an analysis of shortages in the current workforce capabilities and capacities to meet future work needs (Fournier, 2016).
Forecasting and Preventing workforce issues:
Workforce planning is conducted to forecast various workforce issues in advance. Analysis of likely issues and development of future plans helps prevent the number of problems that are likely to be faced in an organization due to several workforce challenges. Competencies required for achieving organizational goals are also identified, and staff members are hired on the basis of required competencies in the organization. Along with this, it involves a deep analysis of various internal and external factors that may affect the future workforce demand.
Workforce planning also helps in managing talent in the organization by hiring the best people at the organization and the position needed. Also, the right people are hired right through regular workforce planning.
Development of workforce strategies:
Various strategies are also developed on the basis of analysis of gaps in workforce planning and on the basis of various issues that can be faced in an organization. workforce plans also include the development of training plans for the staff members.
Need for workforce planning:
The above section helped in identifying that it is a must conduct workforce planning in the organization to retain the best talent at the required positions and at the right time in the organization. Every organization, i.e., public as well as private organizations, is required to develop workforce plans to avoid surplus and shortage of staff members in the organization. Following points shows the needs for conducting workforce planning in the organization:
Improving organizational image:
Workforce planning is also needed to improve the image of the organization. retaining and attracting the best talent in an organization helps in building up the reputation of the organization. Also, workforce planning and selecting the best talent in the organization also helps in improving the productivity and performance of the organization, which further helps in strengthening up the reputation of the organization.
workforce planning is also required to avoid the negative impacts of various demographic changes on the organization. It may also happen that workforce may become old and may fail to work on various technological changes in the organization. workforce planning helps in identifying all factors relating to the demographics of existing staff members.
Workforce planning is also required to predict the upcoming changes in workforce demand-supply in the organization. Workforce forecasting helps in estimating the increase and decrease in demand and supply of the workforce, which helps in preventing a number of problems such as labor cost, higher turnover, and layoffs in an organization.
Taking advantage of talent sourcing opportunities:
Workforce planning also helps HR managers in taking advantage of various talent sourcing opportunities, which further helps organizations to source the best talent (Workforce Planning, 2002).
Types of the workforce plan
workforce plans are generally of three types, which includes Strategic workforce plan, Operational workforce plan, and workforce management plan. The methodology used in all three workforce plans is almost the same, but the forecast period and the type of details that are required to analyze and respond to risks vary from plan to plan. The following section shows the detailed description of three types of workforce plans:
Strategic workforce plan (3-5 years):
A strategic workforce plan is generally made for the period of three to five year forecasting period. However, this plan is extended to a longer period when longer period plans are required to be framed for workforce planning. This type of plan also helps in defining the current trends in demand and supply of the workforce, which further helps in defining the actionable strategies for the business workforce activities. It also describes the forthcoming workforce capabilities or competencies required to maintain the operational activities in the organization and also for achieving the strategic plan in the organization. Along with this, a strategic workforce plan helps in defining the total number of workforce that would be required for a complete year. A strategic workforce plan consists of strategies that convey the existing workforce capability of an organization, what it needs to be, and how to achieve the objective.
Operational workforce plan (12 to 18 months plan)
An operational workforce plan generally is prepared for 12 to 18 months’ plan and is generally lined up with the organization’s planning cycle. It also helps in defining the strategies that can be adopted to reduce workforce gaps by describing the skills or competencies required by staff members to achieve business plans. Thus, operational plans are the general workforce plans that help in conducting workforce planning. Also, the size of the plan depends on the nature and size of the organization. In Spite of short term aim, the company also need to explore further to understand where an organization is heading. ("Workforce planning explained," 2019)
Workforce management plan
A workforce management plan is the instant plans that are prepared for a much shorter period in the organization. This type of plan deals with immediate concerns or issues of the organization's workforce and helps identify actionable strategies for managing them. An organization may have more than one workforce management plan, depending upon the complexity, size, nature, and location of the business.
Documenting workforce plan:
The workforce plan helps summarize the information about the current workforce. It helps in developing a number of strategies for future workforce operations by analyzing the needs of the future workforce. This further necessitates the need for documentation of workforce plans. The following section provides the steps to be followed to document the workforce plan in the organization:
- Identifying the type of plan that needs to be prepared in the organization.
- Description of demand analysis, i.e., current business scenario and workforce capabilities
- Description of future internal supply of workforce by outlining the workforce trends and by analyzing skills and capabilities of existing staff.
- Analyzing workforce trends such as aging workforce, gender inequality, turnover rate, etc.
- Description of external supply of workforce by conducting future supply analysis and analysis of skills and capabilities required in business.
- Conducting gap analysis and writing the results of gaps identified.
- Developing and writing strategies for workforce plans.
Workforce planning example:
For a better understanding of workforce planning, a workforce plan for Tesco has been prepared. The workforce plan for Tesco is shown as follows:
Organizations adapt to a number of changes in a business environment. A number of technological innovations occur at a regular pace, which necessitates the hiring of skilled or qualified staff members. Tesco is a large supermarket chain, and human resources are the biggest asset of supermarket chains. Tesco prepares a workforce table every three months to ensure that the right people are placed in the organization. The following analysis shows the workforce plan of Tesco:
Description of type of plan: Workforce management plan
Current business scenario:The growth phase, operations at global level, and rising current revenue
Workforce capability: Teamwork, self-management, problem-solving, communication, literacy, etc.
The objective of the workforce plan:
- To minimize the labor turnover and to develop a flexibility plan.
- Hiring an adequate number of staff members in each department.
- Development of effective HR strategies.
Internal hiring: Tesco also provides regular promotions to its staff members on the basis of their capabilities and competencies. Internal transfers from one department to another department are also conducted to ensure that employees do not get bored by working in the same department.
Workforce trends: lower employee turnover and improving employee engagement. However, Tesco aims to hire various technical and operational staff members to increase the effectiveness of operations.
Recruitment methods: Online advertisement and in-store advertising
Selection tests: two levels of interview and aptitude test
External trends and supply: Reducing rate of unemployment
Gap identification: May face a shortage of workers due to decreasing unemployment and the rising rate of a number of firms.
Strategies: Defining workforce hiring plan for each work level. following are the work levels for an organization:
- Dealing with customers
- Managing resources
- Managing and supporting operating units
- Leading others and adopting strategic change
- Excellent retailing through effective services
Thus, it has been identified that Tesco will hire its staff members for each operational level. Also, it has been identified that Tesco will adopt a number of hiring practices to hire a large group of staff members. Further, this plan will be prepared every three months to avoid any workforce-related problems being faced in the organization. Tesco will also increase the number of trainers in the organization to increase the effectiveness of its staff members. Further, the pay base of employees will be increased to keep the existing staff members motivated in the organization.
In addition to this, the case study of Woolworth's human resource practices is also very encouraging. It teaches an employer different ways of workforce planning. Also, by taking lessons from the experience of the established companies, a company can move towards the path of development.
Detailed analysis of workforce planning and its operations helped identify that regular planning and analysis of supply and demand factors of the workforce can help define the number of strategies to avoid workforce-related challenges. Also, it has been identified that there are three types of workforce plans that can be prepared for hiring the right people in the organization.
- Workforce planning explained. (2019). Retrieved 31 December 2019, from https://www.apsc.gov.au/2-workforce-planning-explained
- Fournier, J. (2016). 5 Reasons To Implement Strategic Workforce Planning. Retrieved 31 December 2019, from https://www.hcmworks.com/blog/5-reasons-to-implement-strategic-workforce-planning
- Paton, N. (2019). Supermarket sweep: Tesco - Personnel Today. Retrieved 31 December 2019, from https://www.personneltoday.com/hr/supermarket-sweep-tesco/
- The importance of workforce planning. (2019). Retrieved 31 December 2019, from https://www.financialexpress.com/archive/the-importance-of-workforce-planning/36993/
- Workforce Planning. (2002). Why You Need Workforce Planning. Retrieved 31 December 2019, from https://www.workforce.com/2002/10/24/why-you-need-workforce-planning/
- Workforce Planning. (2019). A Guide to Strategic Workforce Planning | AIHR Analytics. Retrieved 31 December 2019, from https://www.analyticsinhr.com/blog/strategic-workforce-planning/
What is workforce planning?
Workforce planning refers to the proper planning and management of the employees of a company. Proper planning allows a company to have high employee engagement resulting in increased and prolonged profits for the company.
What are the steps in workforce planning?
Workforce planning as a process varies as per the model in selection. The common steps of workforce planning include strategising, analysing, developing an action plan, execution and monitoring of the results achieved through the process.
What is the purpose of workforce planning
This is the process which is directed towards the right management of the employees at the right place and right time by giving them the right tasks in hand. Here, the company tries to make sure to mend any type of gap and move towards the goal of development.