Speaker 1: Hi, I'm Kevin Rutherford. Welcome to RG's Talent Tips. Today, I'm going to show you how to build out a strategic workforce plan. For the last several years, businesses globally continue to be challenged by workforce issues of crisis proportions, including things like high turnover, shortages of qualified staff, and even low morale. More pointedly, businesses have been in survival mode. Consequently, talent decisions have taken a backseat and often were made with little strategic thinking, planning, or even foresight for the future. Navigating these uncertainties successfully requires multiple insights that help inform businesses about the actions to take regarding their strategic direction. From a business and HR perspective, strategic workforce planning has, or should I say, at least will be likely for the next few years, the greatest challenge faced by organizations today. Focused workforce planning can equip us to meet this challenge. As a tool, workforce planning is one of the best strategies for improving organizations. Why? Because it forces us to think strategically about how to align people to our business, not so much as a one-time event, but as an iterative process tied overall to business strategy. Now, for our purposes, although there's many different ways to define workforce planning, at its core, we define workforce planning as the strategic alignment of an organization's human capital with its business direction. It is a methodical process of analyzing the current workforce, determining future workforce needs, identifying the gaps between the present and the future, and then implementing solutions so that the organization can accomplish its vision, missions, goals, and objectives. You may have also heard some describe workforce planning as the process of ensuring that an organization can achieve its strategic objectives by having the right people with the right skills, in the right roles, at the right time, and the right cost. That's actually pretty good, too. So now that we have a context for what workforce planning is and what it can do for companies, let's dive right in. So what I'm going to do today and share with you is our six-step model and roadmap that we use for strategic workforce planning and then the process that we use to build out a strategic workforce plan. Now, I first created this model, gosh, in the early 90s, based on my military experience in manpower planning. And it has evolved quite a bit in the last 25 years. And the version that I'm going to show you today reflects our best learning from over 135 SWP build-outs for companies around the world. Now, what I love about building out strategic workforce plans is that a great SWP informs the business about what is possible. It helps businesses answer the question, given where we are and where we want to be, do we step on the accelerator, do we cruise along at high speed, or do we tap on the brakes when it comes to having a workforce that is capable of meeting or exceeding the strategic business objectives? Using SWP, HR can now play a more strategic role by becoming a contributor and not a recipient to business outcomes. So let's take a look now at our strategic workforce planning model. What you can see is, on this model, there are six distinct steps. Step number one is strategy translation. Step number two, data collection. Step three, forecasting and capability review. Step four, risk identification. Five is really gap-closing strategies or talent strategies. And step six, probably the most important of all, is evaluation. So these are the six steps. Now, under each of these steps, what you see here is kind of a high-level list of key elements that need to be executed when you're building out the strategic workforce plan. Some of these steps can be done sequentially, and others can be done in parallel depending on your company's resources, the capabilities you might have, and your timelines. So for example, we could look and say, I'm going to come up here and say, you know what? We could take data collection and forecasting and capability review. Those may be conducted at the same time in a relatively short order. Conversely, I might look down here at gap-closing strategies. And those things can take anywhere between six months and 36 months to complete, really depending on the number and size of gaps that you have plus the resources. So now what I want to do is really dig deeper and examine each step in a little bit more detail. So let's take first here a look at step number one, strategy translation. You can see the first thing that we do is we start with business strategy. If you've watched any of our other videos or heard me talk, I always say everything starts with strategy. And that's the case here. You cannot build out a workforce plan or at least inform the business until you have some idea of where the business wants to go. So what we want to do is review that strategy, have your organization's strategy in hand. And they may have just one plan, or they may have a couple of different plans where they've created one or two, maybe even three scenarios. I think we explained that in an earlier video that we talked about where we said, say maybe an organization is going to grow globally, but they could grow organically, meaning grow with the staff that they had, or they're going to grow globally by acquisition. Those two workforces are very different depending on the strategic direction you take. And so that's what we want to do is get an understanding that we actually may complete more than one strategic workforce plan based on that strategy. But that's a different story. In any case, what we're looking for here is to make sure that we understand what the strategy is and the operational plans. And then more specifically, what are the workforce implications of each one of those strategies? You may also remember from another video that we did, we called the eight C's. And those are around workforce risks, things like culture and capability and compliance, a host of other issues that we look at to say, if we go in this direction, what is the risk that we're going to incur by going down that road? That's really important because you need to translate that strategy into real people kinds of issues. The second area here is really on what we call administering workforce planning. This is more the project management piece. Here, what we want to do is to look at and build commitment from our leadership team. We want to make sure that we have a team that is put in place. And notice when I say a team, some of you may be the only person on your workforce planning team. And that's OK because we need somebody to drive SWP. And then we also need others to help support us in that role. And we can look to other areas of the business to make that happen. The key here is that you want to have a communication plan, a project plan, everything laid out to say, where are we going, where are we going to be in an X amount of time, and how are we going to get there? This is really all about project management and strategy translation. So now that we've kind of completed step one, one of the things that you want to think about before we jump into the next one is that it really is essential to gain support from the senior leadership team before you begin workforce planning. And the reason I say that is because simply, if you don't have their support, you're never going to get anything done. It's also helpful if there is some kind of a champion at a senior level, whether that's another business leader or your VP of HR who can at least market and sell the concept to other executives on the team, keep the SWP agenda as a priority issue for the entire organization. One thing here, again, with high-level support is that it adds weight to whatever you're trying to accomplish and really increases your chances of support and cooperation from colleagues. So let's go now to step two. Step number two is data collection. This is what I call the heavy lifting of workforce planning. And if you run into a bottleneck, this is usually where it is, because now I'm going to go back through all of our systems, whether it's our payroll system or our HIRS system or our financial systems. But I'm going to gather a whole lot of data about the workforce. Think of this as we're going to perform a CAT scan on the business. I'm really going to dig in and say, what does the organization look like today? I may want to know gender, age, education, tenure and role, performance appraisal. I want all this data that tells me what is the workforce that I have. Think of this as what is my current state? Two of the areas that I really want to focus on here is I want to do an environmental scan. Generally, an environmental scan is either done by your strategic business planning group. It could be done by maybe your risk assessment group. But the environmental scan simply says what are the political, economic, social, technological, legislative, and environmental issues that are out on the horizon, that are in the globe, things that we've been dealing with for the last few years that have really created some of these crises, and say, how could these impact my workforce's ability to deliver on that strategy? That's what we want to know. That needs to be done. Second key thing is something that you've probably heard if you've ever been to business school or if you've been in business very long, you've heard the term SWOT. Strengths, weaknesses, opportunities, and threats. That's SWOT analysis. Oftentimes, you'll have this done by, again, your strategy group or your risk group. But the key piece that is often missing here is in addition to a business SWOT, this is where we will conduct an HR SWOT. Because the idea here is people have, our people, our workforce has both strengths, weaknesses, opportunities, and threats. And those will vary or differ based on what is our strategic direction. It's important to know these things right up front. And then lastly, another key piece of this data collection is to determine how we want to segment the workforce. Workforce segmentation is probably, to me, the most important thing you can do in workforce planning. And that is to understand which roles in your company drive the most value. In essence, which ones deliver the revenue, the bottom line impact that your business is going to have delivering on that strategy. So here, we're going to actually segment roles into things like strategic and pivotal roles, critical roles, core roles, and then others that may be misaligned, meaning that where we're going, some of the roles that we have in the organization today are not a good fit for where we want to go. So this is really all here the heavy lifting. And again, I want you to think of this as the current state. This is the current state of where are we today. Now, let's transition here to forecasting and capability review, which says, where do we need to be? Where do we want to be? So one of the first things that we do is we look at supply and demand. What is the talent that I have? That's the supply versus the talent that I need. And that is my demand. Now, some people say they prefer doing one versus the other, first do supply first, then demand. Others say demand first, then supply. Doesn't really matter. The key is that you need to have a good idea and a good vision on what's your talent that you have versus the talent that you need. One of the key pieces here that I spoke about earlier is your organization may have a couple of different strategic directions they want to go. That means that you need to perform scenario planning. Know what talent is required in an organization that is going global organically, meaning with the team that they have. Or I'm going to grow globally, but I'm going to do it by acquisition. Very different workforces, very different supplies and demands. Really critical to understand that. Next thing that we really want to look at here is the competencies. And this is what we call competency identification. If you don't know the knowledge, skills, abilities, and other attributes, even more importantly, the experiences that are required to deliver on that future direction, you're going to be in a world of hurt. So what is it we have today? What is it we need in the future? And how much of a surplus do we have and versus how much of a deficit do we have? And then where do we kind of fit in between? Where do we maintain? Where do we exit some? And where do we add some? That's a critical component here, understanding this. So now that we've kind of come to this point of having all the data, knowing where we are, where we want to be, the next thing then to say is, I want to subtract or look to say, this is the demand. Do I have the supply to meet that? That's where I then do risk identification, better known as gap analysis. And here, we typically look at gaps in three different areas. I'm going to focus on gaps in staffing, meaning bodies, the number of people that I need. I'm going to focus on gaps in competency. What are the knowledge, skills, and abilities required to be successful in the future? And then one that we also look at is what we call profile, workforce profile, gaps in workforce profile. This is typically demographics. Maybe the workforce I need in the future needs to have a higher education level. Maybe it's a lower education level. Maybe I need more women in the workforce than I have today. Maybe I need less experienced people on the front end than I do on the back end. All of those things really make up the profile to say, maybe if I'm moving into a different country, I need people who can speak this language at at least this level. It's really important to know what is the profile. So it's, again, three things, gaps in staff, number of bodies, people, gaps in competencies, knowledge, skills, and abilities, and profile. What does the workforce need to look like? Those are the gaps that I'm going to focus on. Now, once I've done that, one of the most important things you can do to get buy-in from your leaders is simply this, to have what I call a validation meeting. And that means I'm going to take all of the stuff that I've just put together here, and I'm going to share it with my leaders so that they can see what the talent implication risks are that we have identified. Then I want their input. Do you agree with this? Do you see something that's different? Do you see something needs to be added? Or is the risk that we're looking at here too great? Or is it too not enough? You want their validation to kind of help this. Because when we go to sell this internally, we want their support. This is another buy-in step. Buy-in here on the front end, buy-in here on the back end. Before and kind of somewhat after. Now that we've got our gaps really analyzed, so we know where we are, where we want to be, what are the gaps, now the key piece is putting the rubber to the road. This is the part that, right here, this is the part that HR people love. This is our bread and butter. This is what we do. We are now going to create gap-closing talent strategies to close the gap between where we are, where we want to be, and our people. How do we do that? All kinds of ways. So probably one of the first things that we would look at would be organizational design, meaning is the structure right? Do we have it, does it need to be functional? Does it need to be set up geographical? Does it need to be set up by product? What about span of control? All of those things, work design, are in there. Also, what about the culture? Does the culture need to change? Are we going to be more like this and less like this? Culture would change. Competencies, again, if those knowledge and abilities, really competencies change considerably, maybe we need to change our competency model in terms of the requirements that are there. Next, we might look at total rewards. Do we need to change up our incentive systems and our compensation system to either attract the type of people that we need or to reward the behaviors that we're looking for? Change our performance management system. Maybe it's talent acquisition. Maybe I need to hire new people. I need to really have a focus on a different type of person, that profile that I'm looking for in the future. High potential talent. Do we need to do something different with the high potential talent that we have today versus the future? Tie that in with succession planning. Now that I maybe changed up my organization, does the succession plan need to be different? Because what got me here may not get me there. I may need a different look in terms of what's required for success or in the future. And of course, career pathing. And then we can look at leadership development and talent development. And then we look on that back end of either engagement and retention. So all of these, and I haven't covered everything here, but all of these are specific HR interventions that we can use to close gaps that we have in the workforce that's gonna either slow us down or keep us from meeting or exceeding those strategic business objectives the organization has set out. This is our bread and butter. Up to this point, we're really cranking hard to get where we need to get to, to do what we do best. And then lastly, we look at what we call evaluation. And this is really ongoing. Typically when we do evaluation, we wanna look at two things. Number one, we want to focus on the process itself. So we're gonna measure and say, did we follow all the steps in the timeframe that we wanted to? Did we get achieve what we wanted to do? Did we do it in the milestone? So we're just saying, did we follow the process? Can we make this become part of our strategic planning and be part of our DNA? Because quite frankly, a good SWP should be done all the time when you have your annual strategic planning or mid-year planning. This should be part and parcel part of that process. And then probably the one that's most important, the one that others look for is, did we close the gaps? If the gap was here, did we close the gap to this? Was it this or are we still very far off? The idea is we wanna have a plan on what's the gap, how do we close it? If you don't have a plan, you don't know where you're going. So again, now that we've kind of gone through these areas and I've walked you through our SWP model and how it impacts the business outcomes, it really should be clear that those companies that commit to the development of a strategic workforce plan will gain a thorough understanding of their current workforce and more importantly, will identify what is needed in a future workforce that's gonna help accelerate the company's success. And then I think this is another really important point is that it will help determine the most effective and efficient use of employees in creating a workforce that is and will continue to be prepared to meet or exceed those organizations strategic business objectives. Bottom line, whether your company uses the entire strategic workforce planning model that I've just showed you, our model, throughout your organization, or maybe just uses the model for a department or even a position, this process, using this process will begin to establish a new way of thinking for your leaders about the workforce and its importance in considering the impact the workforce has on the success of the company. All too often, I think leaders miss this part. They don't recognize that it has such an impact on the business. So with that in mind, now that you've seen all this, I just have one question for you. What are you waiting for? Go create your strategic workforce plan. I hope you enjoyed this video and learned something that you can apply right away. If you did and want more, please subscribe to our channel below and check out our website for even more content, handouts and free tools that'll take you from where you are to where you want to be. Until next time. ♪♪