10 considerations for successful workforce planning

Last updated:
March 26, 2021
December 18, 2021
min read
Sim Samra
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What is workforce planning? The term often gets bandied about, but few people understand the full implications. Briefly stated, it’s about ensuring that you have the right people in the right jobs at the right time, now and in the future. Employee planning is closely aligned with strategic organizational planning and aims to avoid overstaffing or understaffing.Being under or overstaffed comes with massive cost implications:

  • Too many staff results in high payroll costs that don’t align with productivity and revenue leading to losses.
  • Too few staff to meet production and fill orders leads to a decline in sales and a decline in revenue.

Properly done, workforce planning extends across the full employee retention cycle, from hiring to retiring. It also incorporates talent attraction, recruitment, development and succession planning. Without utilizing data, metrics and analytics, however, accurate ratios would be very difficult to define.

Workforce planning definition

More formally, workplace planning can be defined as the ongoing process of analysis, forecasting, and planning workforce supply and demand. This includes assessing gaps, determining talent management interventions and ensuring that people with the right skills are on board in time to meet an organization’s strategic objectives.

That sounds relatively straight forward until you realize that workforce planning is grounded in the present with a focus on the future. Since we can’t predict the future, staff planning involves gathering plenty of data, a thorough understanding of organizational planning, anticipating external influences and creating scenarios.

Putting a workforce planning process together

Large corporations can task analysts with ensuring that workforce needs are met and maintained at optimal levels while keeping costs in line. Smaller enterprises don’t have the need (or budget) for full-time analysts, so workforce planning is usually a shared responsibility of HR and finance.

Executive input and contributions are essential as well because they mostly dictate the company’s immediate goals and future objectives.

There are four critical pillars to a workforce strategy with a few more in-between. The core focuses are:

  • Analysis of current skills and talent
  • Analysis of future plans and potential influences
  • Gap analysis (current and future)
  • Creating scenarios to mitigate challenges

Each company and industry has different needs which will influence additional steps to achieve the best outcomes.

10 considerations for expanding the process

Each pillar has essential steps to extract the correct data so that you can move on and make the right decisions. A necessary part of the process is thoroughly understanding the business’s prime goals and future objectives. The existing and future workforce must be aligned to achieving them, so without a detailed understanding, you can’t continue.

For example, if a company decides to adopt technology on a large scale to digitize many services since the outbreak of the global pandemic, the impact must be analyzed in detail. Some essential skills to the current business model will become obsolete, and skills that are lacking will become pertinent.

Consider these 10 factors when designing your workforce planning model.

What are the short-term and long-term objectives?

Analyze what skills you currently have and if they’re meeting immediate and short-term goals. Based on your current workforce, what needs to be done to achieve long-term objectives? Consider the following metrics: employee engagement, natural attrition, upcoming retirements, skills levels, skills availability and training needs.

What external influences can impact the company’s objectives?

Some things can be anticipated, and others that can’t: who could have expected the impact of Covid-19 on businesses globally? Keeping updated and informed, however, can help predict some likelihoods.

Pending legislation, political instability and even climate change factors can be calculated with some certainty. If you trade in a unionized industry, you can also prepare for challenges, particularly around wage negotiations and objections to changes in working conditions or lay-offs.

The financial health of your organization?

Financial stability allows businesses to weather most storms because even if they face cash flow challenges, they’ll have easy access to credit and funding. Healthy cash flow and a solid balance sheet also allows for more accurate budgeting. You know what labor costs to anticipate and what overheads, production costs and asset replacements/upgrades will be.

Conduct a thorough analysis of your current workforce

Assess how many employees are on the payroll, at what level and how it aligns with short-term and long-term goals. Also, how does your payroll costs compare with your current budgets? Move on to a skills analysis and identify where there are existing or potential skills gaps. Can any existing employees be upskilled?

If you’re overstaffed, and employees can’t be retrained or transferred, how will you approach a retrenchment process? What are the costs attached to mass lay-offs depending on local labor law and union agreements? If you’re understaffed, how will you attract the right talent in the quickest time?

Skills availability

Analyze where there are hard to find skills gaps in your current workforce or future requirements. Where can you source these skills, what will they cost the company and what is the time to hire hiring metric? If there are existing employees who can get upskilled to meet the needs, establish what training is required and how much it will cost. How long it will take a trainee to be fully productive, as well.

Diversity mix

If your organization is lacking in innovation, it could be the result of a lack of diversity. Analyze your existing workforce along the lines of gender, race, ethnicity, age, and cognitive diversity. Plan how you can implement a diversity recruiting strategy going forward. You might want to implement a quota system to ensure that hiring managers comply.

Also, consider the geographic area of branches and sub-divisions to establish if that influences a lack of diversity. Are hiring managers hiring per cultural and traditional norms? In that case, you would need to implement an ongoing diversity training program.

Check out our blog on hiring a diverse team remotely.

Hiring strategy

How must your recruitment policy be adapted to attract the right talent in the shortest time? Digitizing your hiring process is essential so that you have accurate analytics in recruitment efforts available in real-time. Devise different hiring strategies for varying levels of skill and roles. Consider the impact of regional factors on skills availability as well.

How to keep your objectives actionable and relevant

The new-normal brought on by the Covid-19 pandemic is going to see significant strides being made in technology and businesses are going to buy-in. You need to keep abreast of industry trends, industry-related technology and how it will impact your workforce. You also have to remain aware of market expectations.

As an example, technology that cuts out substantial labor costs can substantially reduce the selling price of a product. Customers want the best price. How well can your environment and workforce adapt to technological change and customer expectations?


Once you have all the right data, you have to come up with solutions to align the workforce planning models with current and future company goals. You must also create scenarios of what could impact business and the potential outcomes. Those potentials also need contingency plans and alternate solutions in case things don’t go as planned.

How will you get your workforce to buy into organizational goals

There’s little value to any strategy if it doesn’t include your existing and future workforce. Open communication, transparency and fairness will improve employer/employee relationships. When employees know and understand the organization’s goals and objectives and how it affects them, they’ll be more inclined to embrace solutions.

A workforce plan is a living document

No matter the size of your business, expect the rapid and ongoing change that won’t necessarily get dictated from within your organization. Unstable financial markets, fear, politics and natural disasters will influence customer attitudes and expectations, and that will have a knock-on effect on business.

Now more than ever before businesses must be fluid, lean and agile to adapt to rapid, and often unexpected, changes. It’s not only about preparing your organization, but it’s also about ensuring that your workforce is ready as well.

Structuring processes and building workflows to help you work smarter and continue to scale your business is made easy with HR tech. Ongoing market and workforce analyses are going to be critical factors that will decide whether a business survives these trying times.

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