Talent Planning For The Times

After The Chaotic Cutting Of The Latest Recession, Many Employers Are Looking At Workforce Planning

The current recession took much of the world by surprise, and in the midst of the freefall many firms made precipitous people cuts that cost them key talent and hindered their future growth. This article explores the renewed interest in workforce planning software, whose tools help companies handle the ups and downs of business demand and keep firms moving forward in good times and in bad.

Readers are first introduced to the nature of workforce planning software and its ability to forecast the number and kind of employees a firm will need in the near- and long-term. The software is designed to home in on key job families or skills that will be required, allowing firms to experiment with different scenarios, determining what workforce risks or costs might result from taking steps such as eliminating a business unit or entering a new geographical market. The author discusses short-term, operational workforce planning designed for mergers or restructuring and longer-term strategic workforce planning designed to help firms meet the challenges of shifting demographics or anticipated future technological trends. The major players for both planning types are noted, with the author descrying the lack of long-term planning in many organizations [82 percent of them according to one study] that caused companies to “binge on talent” in good times and “purge talent” in difficult times.

Readers are then introduced to some of the intricacies of long-term planning, where companies use “environmental scans” that consider external factors like regulatory, political or business trends that can affect the supply and demand for talent. Once companies figure out what data sources to use in their calculations and how to weigh them they typically create a number of scenarios and categorize their talent into:

• Strategic Roles – critical to long-term success;
• Key Roles – crucial to short-term results;
• Core Roles – marginal to business priorities but nonetheless necessary; and
• Non-Core Roles – that can be targets for training or cutting.

Recognizing the costly nature of a short-term focus many organizations are now “seriously thinking about workforce planning as a foundation for both a short-term fix and a long-term strategy.” This interest intensifies as firms work harder to identify and retain key performers. One recent study found that only half of companies have the necessary workforce data readily available to make immediate decisions such as layoffs. Bad decisions in this recession have companies putting their money where their minds are, with all the major workforce planning software companies reporting double digit growth in 2009.

Examples are provided of workforce strategy development, implementation and results. The advantages of going with a niche versus a comprehensive software provider are discussed, as are the ways to capture and preserve the positive facets of a firm’s culture.

Source: Ed Frauenheim, Workforce Management; Oct 19, 2009