Creating a strategic workforce plan: A guide to addressing your skills gap
To anyone outside the HR profession, the term “workforce strategy” probably sounds like a soften-the-blow euphemism for either frantic hiring or aggressive headcount reductions. Of course, it’s neither – and the importance of understanding the strategic workforce has only increased in the face of the COVID-19 pandemic.
It’s critical now for both HR professionals and employees to understand that companies have no choice but to continuously think about organizational structure to respond quickly – and accurately – to changing market forces and conditions. Organizational competitiveness depends on it.
That might mean recruiting, employee training with digital skills, or a new approach to talent management – but more likely a combination of all three and more. But these are really the tactical outcomes of a smart, effective strategy and planning, preferably from the board-level down.
As in games of strategy, like chess, there’s no single set of steps or a one-size-fits-all solution that achieves a player’s vision of victory, but a mix of tactics that get swapped out and changed in the course of play. In HR, this might mean a mix of skill assessments, insourcing, outsourcing, and leadership development, all in the service of one major strategic objective.
The challenge is where to begin and what factors should be considered. Can technology help? Can roles be added temporarily to fill skill or resource gaps? Should diversity be factored in? When is the right time to start building a workforce strategy?
Tips for strategic workforce planning
While companies of varying shapes and sizes will employ different workforce strategies, the overall objective is the same: be smart, strategic, and nimble so short- and long-term business problems and objectives can be addressed quickly and easily. The tactical solutions will vary by scenario, be they reorganizations, hiring, reskilling, RIFs, or some combination of them all. But the goal is always to be ready to reposition the company for success under any set of circumstances. These five tips are a starting point for developing your comprehensive workforce strategy.
1. Start with the business goals, and plan ahead.
Even under normal, non-pandemic conditions, HR leaders should start by getting clear visibility into what the business objectives are and where the “human” part of “human resources” can help. Start by determining which people have the right skills to help the company meet its current strategic objectives, whether those skills exist in sufficient supply, and how easily they can be redeployed in the future. If (more likely when) business goals shift, very possibly part and parcel with incorporating automation and other cost-saving solutions, you’ll then have a strategy to hire, train, or reorganize in line with those goals. Revisit your strategy regularly to make sure it’s always looking ahead beyond the current horizon.
2. Don’t go it alone.
Planning a workforce strategy (and contingencies for various business scenarios) was already a full-time job. Even before COVID-19 hit, companies were facing increased competitive pressure, the need to digitize operations, as well as struggling to fill skill gaps. Companies need to pivot faster than they ever had before – leaving some competing for scarce talent in areas with skills newly in demand, while others were suddenly dealing with a talent surplus.
Today, economic and market conditions continue to change by the day – faster than any HR organization, large or small, effectively plans for. That’s why it’s best to leverage technology that lets HR managers manipulate the complex structure and dependency of org charts with flexibility and ease, all while assessing immediate and long-term financial impact, with real-time visibility into skills data. While these capabilities were once distributed throughout different enterprise software systems, they can now easily be integrated. Whatever tech tool you use, find one that allows you to expend your energy shaping the strategy and the vision, not get mired hunting down the information you need.
3. Keep diversity top of mind.
As one or more workforce strategies are planned out, keep diversity front and center, even when the pressure of other priorities threaten to push it to the margins. The benefits to a company’s culture and bottom line in the long run are too great to ignore. As any company looks to lift and shift resources, skills aren’t the only business-critical consideration. The data have long been conclusive: companies of all shapes and sizes that commit to retaining a diverse workforce deliver better business outcomes.
Companies of all shapes and sizes that commit to retaining a diverse workforce deliver better business outcomes.
4. Look internally: employee development and succession planning.
It’s long been known that retention is cheaper than recruiting, but that’s an oversimplification. There are times and situations when hiring to fill a skill gap as identified through a workforce-strategy development plan is the best and only option. The rise of the gig economy has even made hiring a more economical option than it was in the past, especially for short-term needs. But when it comes to long-term business goals and developing the skills to achieve them, think in terms of succession planning through employee and leadership development. Particularly in a tight labor market and talent pool, most employees will want the opportunity to develop their own skills as well as help the company navigate turbulent times.
HR leaders should, in building out a workforce strategy, advocate for existing employees as the key drivers – and stakeholders – when it comes to executing on that strategy. Don’t discount, too, the ability of retaining and retraining existing employees to help sustain company culture, an especially difficult task in our age of remote working.
5. Create a culture of learning, and let employees drive it: upskilling and reskilling.
While HR might hold the keys to the kingdom in terms of who’s hired, let go, or reskilled, the employees operating the company on a daily basis are closest to the successes and failures, and know best what’s needed in terms of new skills and who, internally, is able to step up and take on new challenges. That’s why, when skill gaps are identified through a workforce-strategy exercise, it’s important to let employees provide input on the specifics. In other words, fostering an environment of learning isn’t always a top-down endeavor. It’s on HR to create the culture of learning, then let the employees identify the types of skills they want and need to develop. This ensures that training isn’t a flash-in-the-pan, as-needed project, but an always-on, deeply ingrained aspect of company culture. Over the long term, this will mean fewer glaring skills gaps. And when you empower employees to drive their own learning journeys – by using HR tools that facilitate continuous learning and give them access in a way that’s tailored to their own schedules and learning styles – you make the most of your investment.
Reskilling and upskilling initiatives are far less impactful and beneficial to an organization if they aren’t accompanied by a comprehensive workforce strategy. Similarly, there’s little point in developing a workforce strategy if it’s only used to shuffle people in and out, without considering the short- and long-term business objectives – not to mention how best to address skill gaps.
If all this sounds like a rethinking or reimagining of the HR function, that’s because it is – and it’s needed now more than ever. The HR professionals who commit to workforce-strategy development – particularly with upskilling, succession planning, and diversity as key elements when business changes and cost-saving innovations such as automation are adopted – will be those who drive long-term stability and growth for their organizations. And the more bravely HR professionals reshape their profession in this way, the faster executives and rank-and-file employees will be inspired to follow.
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