This is where strategic workforce planning in Human Resources comes into play. But what exactly is strategic workforce planning?
In this article, you’ll learn what exactly strategic workforce planning is, the different types of workforce planning, and how to implement strategic workforce planning effectively. Additionally, we will reveal the most important advantages of well-thought-out workforce planning and what can happen if it is neglected.
What exactly is workforce planning?
Workforce planning is an organisational component of Human Resource Management and encompasses all strategic and operational measures to ensure that a company’s personnel needs are optimally met at all times.
As part of workforce planning, personnel issues for short, medium, and long-term planning are addressed, and appropriate measures are taken to keep the company economically viable.
Workforce planning is divided into quantitative and qualitative planning:
Quantitative workforce planning
This type of planning deals with the number of employees needed and takes into account factors such as employee turnover, expansion, or seasonality.
Qualitative workforce planning
This focuses on the necessary skills and qualifications of employees. What competencies are needed to meet future challenges?
You can learn more about talent management in our A to Z guide.
The specifics of workforce planning
Workforce planning is a continuous process that must be regularly reviewed and adapted to changing conditions. Good workforce planning, however, helps your company respond flexibly to market changes and ensures that the right employees are always available.
This also includes improving the skills and knowledge of your own employees through training and further education so that they are up-to-date.
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What are the goals of workforce planning?
At its core, workforce planning deals with the current workforce of a company and the associated question of how many employees with what qualifications are needed at what time to achieve the set company goals and maintain an ideal atmosphere within the company.
The goals of workforce planning are diverse but always aimed at increasing a company’s efficiency and effectiveness.
Efficiency Increase
Strategic workforce planning aims to optimiae efficiency and productivity. This means deploying the right employees with the appropriate skills at the right time to avoid bottlenecks and use resources effectively.
Flexibility and Adaptability
Another goal is to increase the company’s flexibility to quickly respond to market changes, customer needs, or technological developments. This requires an agile workforce strategy that allows adjustments in team size and composition.
Skills and Competency Development
Workforce planning also aims to continuously develop employees’ skills and competencies. This is achieved through targeted training and development programs and further education within the framework of the personnel development concept, ensuring employees possess the necessary skills and knowledge to perform their tasks effectively and adapt to changes.
Cost Optimisation
Finally, workforce planning aims to manage personnel costs efficiently. This includes minimising overtime, optimising deployment planning, and reducing turnover through better job design and compensation policies.
What can happen without thoughtful workforce planning?
Without careful workforce planning, various problems can arise that can significantly impact a company’s operations. These include:
Personnel Shortages
Poor workforce planning can lead to insufficient employees to handle the workload, resulting in bottlenecks and jeopardising customer satisfaction. A thorough workforce needs assessment ensures that enough qualified employees are available to keep the company running smoothly.
Overcapacity
Insufficient planning can also lead to overcapacity, meaning more employees are available than needed, causing additional costs without benefiting the company. Careful workforce planning helps avoid such overcapacity and use resources more efficiently.
Additional Costs for Recruiting and Training
Faulty workforce planning can also result in more frequent recruitment and training of new employees, causing financial strain due to recruiting costs and training times, which can affect the productivity of new employees and their teams. Targeted planning can help reduce these costs.
Skills Deficits and Missing Competencies
Without clear workforce planning, your company may eventually face skill gaps and a lack of needed competencies, affecting team performance and the company’s ability to respond to changing market conditions. Strategic workforce planning ensures your employees have the necessary skills and qualifications to achieve company goals.
Dissatisfaction and Poor Working Conditions
Poor workforce planning can lead to unequal workload distribution, contributing to dissatisfaction and a sense of unfairness among employees, negatively affecting team dynamics and leading to a poor work climate. Targeted workforce planning that promotes fair workload distribution and clear communication can improve working conditions and increase employee satisfaction, contributing to the long-term retention of qualified employees and supporting your company’s productivity.
Competitive Disadvantages
Companies without effective workforce planning risk falling behind their competitors. A lack of adaptability to market changes and underutilised employee potential can eventually cause the company to lose or fail to expand its market position. Strategic workforce planning is therefore crucial to secure competitive advantages and ensure long-term success.
What are the advantages of well-thought-out workforce planning?
Strategic workforce planning offers numerous advantages that can contribute to smooth and efficient operations. Below are some of the most important benefits:
Optimized Resource Utilisation
Targeted deployment planning optimizes the use of available personnel resources, increasing efficiency and productivity.
Personnel Cost Control
Ideal workforce planning enables better cost control. Over- or under-staffing is avoided, reducing costs and keeping the budget in check.
Increased Competitiveness
Companies that optimally deploy and continuously train their employees are better positioned in the competition. Qualified and motivated employees not only promote innovation but also the overall performance of the company.
Increased Employee Satisfaction
Targeted development opportunities and improved working conditions increase employee motivation and satisfaction, leading to lower turnover and stronger company loyalty.
Flexibility and Adaptability
Well-thought-out workforce planning allows quick responses to market and company changes, strengthening your company’s stability and future viability.
Personnel Development and Retention
By promoting talents and developing qualified employees, you strengthen their loyalty to your company and your employer brand.
What types of workforce planning are there?
In workforce planning, there are various types or sub-areas, each dealing with different tasks of a company’s personnel resources. Each type of workforce planning is aimed at optimally meeting the needs and requirements of the personnel and contributing to achieving the respective company goals.
Here are the five sub-areas of strategic workforce planning at a glance:
Workforce Inventory Planning
Workforce inventory planning deals with the current personnel situation in the company. It analyses the existing employees, their qualifications, skills, and deployment possibilities. The goal is to get an overview of the current workforce and make adjustments as needed so that the right employees are in the right place. This type of planning forms the basis for all other planning processes in the personnel area.
Workforce Needs Planning
Workforce needs planning, forecasts the future need for employees in the company, considering factors such as company strategy, market developments, planned expansions, or technological changes. Based on these analyses, it determines how many employees with what qualifications are needed at what time to efficiently achieve company goals. Workforce needs planning is closely linked to strategic business planning.
Personnel Development
Personnel development focuses on continuously improving employees’ skills, competencies, and performance through measures such as training, further education, coaching, and mentoring. The goal is to optimally promote employees, expand their professional skills, and bind them to the company in the long term. Targeted personnel development significantly contributes to a more positive work attitude and better work quality.
Recruitment
Recruitment encompasses all measures for attracting and selecting new employees for the company. This includes creating job profiles, posting job advertisements, conducting interviews, assessments, and selecting the best candidates – the entire recruiting process. This area is crucial for gaining qualified and motivated employees who meet the job requirements and contribute to the company’s success.
Workforce Reduction Planning
Workforce reduction planning deals with strategic and operational measures in case of personnel reductions in the company. This can occur through natural employee turnover, voluntary measures, or in difficult situations through dismissals and layoffs. The goal is to adjust the workforce to current requirements and the company’s economic situation without endangering the long-term business strategy.
How does workforce planning work?
Workforce planning is a structured process within personnel management, ensuring that a company has the right employees with the appropriate skills at the right time to achieve its goals. The workforce planning process can be divided into five crucial steps:
Analysis of the Current Situation
The current personnel resources are recorded, including the number, qualifications, and distribution of employees.
Needs Analysis
The future personnel needs are determined, considering both quantitative and qualitative aspects.
Planning of Measures
Based on the needs analysis, specific strategies such as recruitment, training, and internal transfers are developed.
Implementation
The planned measures are put into practice, including recruitment processes and training.
Control and Adjustment
After implementation, regular control and evaluation of the measures take place to make corrections if necessary and adjust the planning to changing conditions.
Through this systematic workforce planning process, you ensure that your company is always optimally positioned to achieve its goals and successfully meet market challenges.
Strategic workforce planning with Zalaris
Through targeted employee development and effective deployment planning, strategic workforce planning increases employee satisfaction and retention while boosting your company’s efficiency, supporting competitiveness, and ensuring long-term stability.
Overall, strategic workforce planning is thus an essential part of successful management of the company resource human and an indispensable tool to strengthen competitiveness and sustainably achieve long-term business goals.
With our innovative technology and extensive expertise, we support you in optimizing your strategic workforce planning and making data-driven decisions.
- With versatile HR and payroll solutions on a single platform: the Zalaris PeopleHub.
- Bring all your employee information together in one place.
- Cover all HR areas, from master data to talent management.
- Automated workflows and self-services make HR work easier.
- Use real-time data and analytics tools for informed decisions.
- Simplify HR processes while complying with local laws and data protection regulations.
- Access the platform anytime, anywhere – even on mobile.
Interested? Get in touch with our experts to know more about how Zalaris can help!