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The different levels of workforce planning

A need for planning is greater than ever. The current business climate of intense competition and increasing speed of delivery means that organisations need to plan ahead better and faster in order to survive. Due to the fluctuating economy businesses need to be prepared for possible downturns as well as upturns. In addition, changing demography, in particular the ageing of the workforce, means that organisations need to make efforts to avert an impending loss of skills as a large portion of the workforce retires. Also new generations entering the job market have different priorities, skills and attitude than their predecessors, which must be considered in this transition.

Workforce planning is a widely used yet often misunderstood term. It’s commonly used to refer to the day-to-day operations, operational workforce management needed to maintain capacity, or shorter-term planning that looks at the months ahead (tactical). While both are necessary, neither will ensure organizational health over the long term. It leaves you unprepared for the uncertainty of the changing nature of work. It leaves you vulnerable to disruption. Planning longer term allows you to anticipate change and be ready for what the future brings.

In order to get a better understanding of the differences withing workforce planning, we split up workforce planning in to three levels. We will discuss operational, tactical as well as strategic planning. We hope that our explanations will help you better understand the levels of workforce planning and on which level certain decisions are made.

Workforce Planning

Operational planning

Operational workforce planning enables the organisation to achieve short term outcomes. This level of workforce planning involves keeping track of day-to-day operations, assigning people  to prepare for immediate operational or resource needs and addressing ad-hoc changes are all part of this form of workforce planning. Operational workforce planning is largely driven by HR and individual team managers, and produces documentation including procedures, processes and rosters. Preparation for the recruitment life cycle and seasonal workforce changes are other typical examples.

Typical examples of personnel planning can be found in a hospital where the nursing staff is planned in shifts, in manufacturing with staff planned at a production line or call centers with operators ready during specified hours. Many software vendors are highly specialized in creating software solutions that can squeeze every productive second out of your available workforce. However, whenever operational planning takes all the focus, organizations tend to forget that most improvements need to be implemented earlier in the planning process, at tactical and even strategic level.

Tactical Planning

This level of workforce planning involves concrete actions that facilitate the delivery of goals identified in an organisation’s strategic workforce plan. Tactical planning is often organised around a fiscal year and prioritises delivering work on time and on budget. Each work area within an organisation should undertake tactical planning. Chief Financial Officers, HR Directors and Senior Leaders are typically involved in this process. Policies that cover specific work areas, marketing strategies, succession planning and workflow arrangements are examples of tactical planning components.

Understanding the demand (which work volumes can be expect?) and how many people we need to cover that demand, is crucial to have the right number of people ready at the start of each day.

When we calculate capacity plans for a few tens of people, the calculation is easy to do on the back of a napkin. But what happens when we need to determine the right capacity for a few hundred people? What do you do when the demand is not straightforward? Will patients in a hospital arrive each day in regular volumes or do they have peaks? What do we do when we do have those peaks?

We need to start with a good understanding of the demand, including its variability in time, in order to understand which people we need at what point in time. 

Workforce Planning

Strategic Planning

When you make a workforce plan on a strategic level, you think about the long-term prospects of your business (3 to 5 years ahead). You formulate a mission, vision and strategy in which you include obstacles like sickness absence and work-life balance. This strategic workforce planning needs to match the goals of the company. Different levels of the business are involved: the board of directors, HR and the management team. The big question is: which staff do we need to reach the objectives of the company?

Fine, now we understand how strategic planning helps us determine the right number of people we need. But where do you get these people? You cannot “just” have an experienced person ready to work for you. As an organization, you must attract the right people, nourish them and make them ready to operate properly within your organization. You need to have a strategic plan to have everybody in place. Organizations that rely on people with specific experience and knowledge have four options: recruit these people at the right level, hire less optimal profiles but train them to fit business needs, outsource work or transform business processes in order to automate them partially. Analyzing and combining all these options for large organizations is like solving a complex puzzle with many uncertainties, and even where the pieces change shape over time.

Several organizations have trusted us into providing software solutions for tactical and strategic workforce planning. Can we help you as well?

Strategic Workforce Management is the future

Strategic Workforce Management is the future

In a fast-changing world as we live in today, sometimes it might look impossible to look ahead to what de organization will need in a short- and long period of time. This makes strategic workforce planning a very big challenge for HR-departments, but it also makes it more important than ever.

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