Accurate and timely manpower planning is critical for any organization to stay ahead of their competition. Simply because by tailoring to the right size, organizations can make sure that they have the right person for the right job at the right time.
Recruitment, as a function is almost blind without having proper workforce planning framework in place. The recruitment team should work closely with its HR business partners and the finance team to understand the business plans of achieving revenue growth. Therefore, understanding the number of headcounts required in different functions to support this growth is crucial. Integrating with the business goal enables the recruitment team to predict how an increase in headcount should be phased in for the organization.
Here’s why manpower planning is of utmost importance for an organization:
- For higher productivity: One of the main objectives of manpower planning is to derive higher productivity through minimum wastage of time, energy, efforts and resources. This is possible to do with the help of the staffing function of manpower planning.
- For effective recruitment and selection: By understanding the future needs of the organisation, the right person can be placed at the right job at the right time through manpower planning, thereby achieving better hiring.
- For employee skill development: Exploring the qualitative and quantitative talent needs of the organization will help you plan your upskilling initiatives better.
- For correct job replacement: Workforce planning also helps you get the right job replacement for ad-hoc vacancies by having some buffer.
- For achieving goals faster: With greater goals being cascaded to the right person, collective goals can be scaled faster and smarter!
- For efficient utilisation of resources: Efficient management of resources, especially in large enterprises is extremely important for organisations to sustain and grow. Management of such large scale manpower can be effectively done through the staffing function.
How to start?
Here is a step-by-step process for you to understand how to begin with workforce planning at your workplace:
- Forecast your manpower requirements: You can either use mathematical projections of trends in your industry and economic environment or use judgmental estimates based upon your company’s specific future plans. This will also help you in effective succession planning.
- Chart out a plan: This involves creating a planning and management team, to facilitate the implementation process.
- Perform a staffing assessment: Bench-marking your organization’s staff size and skill mix can be done by focusing on the internal staffing assessment by testing work drivers, outputs, processes, and tasks. The objective is to frame a model organization.
- Develop demand & supply data: Need to develop demand & supply data by projecting the number of employees and the skills that will be required to meet business objectives, over the planning horizon.
- Perform comparative analysis of the data: Need to identify the gaps and the surplus situation with respect to both numbers and skills.
- Develop the workforce plan: You can then develop a workforce plan by identifying future HR needs in the above-mentioned areas and start developing your action plan.
- Communicate and implement the workforce plan: Communicating the basis of the plan to all the employees will help in bringing life to the plan. Making the organization’s business plan transparent will help in building credibility for the organization.
However before this complete process set up takes place, the job roles need to be analyzed across the organization. A correct competency mapping would help in understanding the key components of a job role. The steps involved in the mapping include the following:
- Conduct a job analysis. Identify the job to be analyzed and set up the procedure to collect job data. Implementing the analysis method and reviewing the data collected help in documenting it. This can be done by collecting responses from the current job holders. The primary goal is to understand what they feel are the key characters that are vital to perform their respective jobs.
- By using the outcome of the job analysis, you are all set to develop a competency based job description. This can be refined by analyzing the input from the respective group of current job holders and converting it to standard competencies.
- With a competency based job description, you are on track to begin mapping the competencies throughout your HR processes. The competencies of the respective job description become your factors for assessment. This also helps in the objective based evaluation.
- Driving the competency mapping one step further, you can use the outcomes of your evaluation to identify additional development and training needs of individuals. This will build a stronger workforce thus increasing the overall productivity of the organization.
How important are automated support systems for implementing such plans?
Predicting the demand and action plans, in particular, must be owned by the respective business units. However, in the first few planning cycles, there is a need for internal support in developing the business unit workforce plan.
In a smaller organization, workforce planning can be carried out with a tablet or a hand calculator. As the organization grows, however, it probably will need to go to an input demand data system directly and pick up supply data from computer-based human resources information systems.
Well! A study says direct people costs make up an average of 40% of organizational costs. From which almost half of the workforce is in critical, knowledge-intensive roles that are elementary to the success and profitability of their organizations. Therefore there is a high chance of getting the workforce planning wrong.
Here are few detailed case studies by Mercer on how they have helped different businesses in their workforce planning and the impact that they have created for the companies to raise their potentiality by pulling in the right person at the right time.
Combining workforce supply and demand analysis into the strategic planning cycle ensures organizations have the ‘5 rights’ – the right number of people, with the right skills, in the right place, at the right level, and at the right cost. This is what strategic workforce planning means.
Through modern analytics, we at Darwinbox empower over a 350 leading enterprises across industries and predict their workforce better!