What Does Strategic Workforce Management Mean?
Strategic workforce management is applying strategy and business objectives to short-term and long-term planning. This includes how your organization decides to develop talent, deal with turnover and manage other business needs. It also includes long-term plans such as strategic talent management and evolving the workforce planning process to fit business goals. In the end, a workforce management strategy is meant to give your business a foundation of automation and plans, so your management team can focus on strategy.
Advantages to Creating Workforce Management Strategies
When you create a workforce management strategy, you can be more efficient with your costs. Automation and more data give you insight into your overall costs and the payoffs of your investment. Data can also allow you to see stats like absenteeism and work to decrease it. But perhaps the most cost-effective aspect of a strategic workforce is the reduced admin time of automating tasks and data collection.
Manage Demographic Changes
The US workforce is becoming older, more educated, and more diverse. For workforce planning, this will require thoughtful talent acquisition and talent management strategies, including what your talent pipeline of leaders looks like and how you are developing cross-generational and diverse talent. You also will want to consider your overall learning and development. The tools you invest in now can help show you how your workforce is aging and support the workforce long-term.
Create Long Term Strategy
Without strategic workforce planning, your human resources team and overall talent management will rely on short-term plans and short-term understanding of your workforce evolvement. Having an effective workforce plan can help your entire company- including everyone from senior management to individual contributors.
Steps to Creating a Workforce Management Strategy
Create Long Term Goals
The first step to creating a successful strategy will be to consider your long-term goals. Any kind of long-term goal setting can be difficult to sit down and actually do, it never seems to be the "right time.” This is why for plans revolving around your strategic workforce, consider assigning a leader to champion the plan and an HR member to help manage the planning. This way, you can assure the work gets done and plan year over year. These long-term goals should be specific to workforce planning yet align with your company’s longer-term objectives as well. For example, a long-term goal may involve succession planning, career development initiatives, talent management function, or other workforce initiatives.
Analyze Your Current Workforce Capacity
Next, use existing data to analyze how your workforce currently operates. Consider what roles you currently have, the overall output, and your company’s skills. In addition to that, gather workforce demographic data because you’ll want to know how many employees are closer to retirement age and what portion of the workforce is younger. Talent management metrics like turnover rate, and average retention rate, can be another helpful layer to understand your capacity. After you have a better sense of your current workforce, you can more easily plan for the future.
Evaluate Your Needs
Now knowing your workforce capacity, you can turn to evaluate your needs. Because workforce planning focuses on short-term and long-term, consider what needs you need today vs. in the future. For short-term planning, you may want to ask,
- Will the current workforce, with minimal upskilling, have the skill sets necessary to meet business objectives?
- Will any external factors currently impact our workforce and the way we are evaluating this? (For example, pandemic or back to work, etc.)
- What current hiring or upskilling efforts are occurring?
For future planning consider:
- With our plans to launch a new product/line/initiative, does our workforce have the skills to help succeed?
- How many employees will be necessary for future business objectives?
- What do we expect our turnover rate to be year over year?
- What will we do to attract new talent?
- What will we do to attract and retain a diverse group of workers?
Address Missing Elements to Your Workforce
Given all the information you've gathered about the current workforce and the short-term and long-term needs, you can begin to address those missing elements. Workforce planning should consider different future routes- for example, you should develop multiple scenarios that could address the missing pieces you have. This could be managing a skill gap, a succession plan, hiring plans, among many other things.
Outsource for Help While Creating Your Strategy
Deciding what an effective workforce will look like can be difficult! But you don't have to do it alone. There are experts in the space that can help you create your strategy. At CAVU we give you access to HR experts without needing to hire on-staff experts. This way, you can save time both with a complete suite of HR software and get a consultation on your workforce management.
Create a Clear Definition of Your Company Culture
Lastly, as you take this time to evaluate and address your workforce needs, consider your company's culture. Workforce management isn't just operational needs. It’s also the internal culture needs. Similar to the exercises above, considering the current culture and what you want the culture to be can help identify how you want to change. This could be reflected in your management, messaging, workforce, and how to reflect that culture in your management, messaging, processes, or values.
Create Changes, Manage Change, Repeat!
Like so much management strategy, part of the impact of strategic workforce planning will come from a commitment to address, evaluate your plan, and repeat the process. This way, your organization's workforce plan can be informed by data each year, and you can make more strategic decisions.