Is your strategic workforce plan misfiring?

Disruption threatens every business. Even global organizations are no longer safe. The Corporate Research Forum finds that the best business forecasters can only plan 400 days out[1] and for most, it’s closer to 150 days. Instead of trying to predict the future, companies could be preparing themselves to quickly adapt their business in response to market trends.

But while they work to develop new products and services, organizations need to keep their core business going. The transition from old to new requires heavy investment in new capabilities, as well as experimenting with new service models. Yet many businesses struggle to fully understand the capability of their current workforce. So, how can you plan for what you need when you don’t know what you already have?

The planning blind spot between HR and Finance

In theory, strategic workforce planning is how a business anticipates the skills and competencies it will need for a sustainable future. In practice, our research shows that most organizations fall victim to a planning blind spot between HR and Finance that stifles this.

The disconnect between operational insight and workforce planning stems from a mismatch between sources of information, giving rise to different versions of the truth. While HR has information about people and roles, Finance knows what the workforce costs and what’s budgeted to bring in new skills. Bringing these two together enables you to more effectively plan and model your future workforce and know what it’s going to cost.

Laying the data foundation for strategic workforce planning

Overcoming this planning blind spot is largely down to data principles and finding common ground. We found that little more than half (53%) of HR and Finance managers say they regularly share data and only 28% say they share reporting systems[2].

A useful starting point to begin bridging the gap is position management. By clearly defining terms and setting parameters for roles and positions across the organization, position management can help reconcile the differing views held by HR and Finance. If all employees are associated with positions that are tied to cost centers, your budget will accurately show variance from the forecast. This gives you the basis for a more informed, reliable workforce plan.

Taking this further, if you use your strategic workforce plan to inform organizational design, alongside a common data foundation and scenario planning, you’ll be in a much better position to effectively manage the disruptive market conditions that will inevitably come your way.

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[1] Margaret Heffernan (2019) Forecasting and how to improve it, 28 January https://www.crforum.co.uk/research-and-resources/forecasting-and-how-to-improve-it-with-margaret-heffernan/

[2] Making people count: 2019 study on workforce analytics https://www.orgvue.com/resources/research-report/making-people-count-report/

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