Workforce Strategy
A primer for curious, action-oriented leaders
What’s in this knowledge article?
What is Workforce Strategy?
Why is a Workforce Strategy important?
When & How to Implement a Workforce Strategy
Resources
What is Workforce Strategy?
An organization’s workforce strategy is the holistic talent plan, for current and future employees, which directly aligns their unique business goals and objectives. It serves as a roadmap for HR to ensure the necessary talent is in the right place to drive the organization’s success and competitive advantage. Although the concept may seem straightforward, as organizations grow, so too does the complexity of the various components necessary to effectively manage, execute and adapt their workforce strategy. It’s important to note that the workforce strategy must remain adaptable to changing business factors which requires the workforce plan to be dynamic.
There are four prominent components to a holistic approach to workforce strategy: organizational design, workforce planning, talent management, and talent acquisition.
Organizational Design is the deliberate process of structuring an organization’s roles, responsibilities and reporting relationships in order to maximize effectiveness in achieving goals and objectives, as well as for cross-collaboration across the organization. In simplified terms, you can think of organizational design as the company’s scaffolding. This involves defining the organization’s hierarchy, departments, teams, flow of information, and decision-making within the organization.
Workforce Planning is the process of aligning an organization’s staffing needs, current and future, to their goals and objectives. This requires a regular inventory of the current workforce’s skills and capabilities, identifying skill gaps, and implementing strategies to develop employees and acquire talent necessary to mitigate risk and drive performance.
Talent Management includes numerous strategic HR activities and processes aimed at optimizing the current organization’s workforce. Some key components of talent management include talent development, succession planning and performance management.
Talent Development is the intentional process of driving professional growth of employees through upskilling, training, career pathing, mentoring, and other opportunities to maximize their potential and contributions to the organization.
Succession Planning is the systematic process of identifying and developing internal talent to ensure continuity by filling leadership and critical roles when the timing and circumstance arises.
Performance Management is the ongoing process of setting clear performance expectations, providing regular feedback, and evaluating employee performance to drive productivity and alignment with the organization’s goals.
Talent Acquisition is the process of recruiting and hiring skilled talent into the organization to fill specific job roles.
Why is a workforce strategy important?
A well-defined workforce strategy ensures that the right talent (i.e., human capital) is in the right place which improves operational efficiency, agility and overall competitiveness. On the other hand, the cost of neglecting to invest in workforce planning can be significant, both financially and in terms of an organization’s ability to remain competitive, innovative and sustainable in a dynamic market environment. In summary, organizations that invest in strategic workforce planning and management components previously mentioned are better positioned to address challenges and achieve long-term success.
When & How to Implement a Workforce Strategy
An organization of any kind can benefit from implementing a workforce strategy as early as possible in order to effectively address current and future talent needs. It does not need to be complex. A proactive approach to implementing a workforce strategy, ideally as part of the organization’s planning process, is highly recommended. In order to do workforce planning successfully, here are tips to consider:
Engage the leadership layers within the organization in the planning process. You’ll get the right information as well as buy-in.
Be diligent in the communication of the workforce plan to the right leaders and groups. Periodically update your Board of Directors as well, particularly with respect to succession planning.
Periodically review and update your workforce strategy to reflect changing business conditions, market dynamics, and talent trends within your operating geographies. We recommend revisiting your workforce planning biannually at a minimum.
Encourage all employees to participate in talent development and succession planning initiatives.
Leverage the organization's available HR data to support decision-making and to gain insights into both workforce trends and performance.
Ensure that your workforce strategy is compliant with all relevant labor laws, regulations, and compliance requirements.
Here are key steps you can take to implement a workforce strategy:
Define Your Strategic Objectives: Clarify your organization's short and long-term business goals and the specific workforce requirements needed to achieve them. Considerations can include expansion plans, new product and/or service launches, market growth, seasonal needs, amongst other key initiatives.
Assess Current State: Analyze your existing workforce data including demographics, skills, performance, and turnover rates. Identify strengths, opportunities, and potential gaps in your current talent pool.
Engage Key Stakeholders: Involve senior leaders, department heads, HR professionals, and front line managers in the strategic planning process to gain diverse perspectives and ensure alignment with organizational goals and across functions.
Forecast Future Needs: Project future workforce requirements by considering factors such as expected growth, technology changes, industry trends, potential retirements or turnovers, amongst other potential factors. Determine the skills and business capabilities that will be essential in the future.
Set Workforce Goals: Establish clear and measurable goals related to internal (talent development, retention, succession planning) and external hiring (talent acquisition) that aligns with your organization’s strategic objectives.
Develop Action Plans: Create detailed action plans that outline the specific initiatives, programs, and activities required to achieve your strategic workforce goals. Define responsibilities and establish timelines for each action plan.
Talent Development: Design and execute training and development programs to enhance the skills and capabilities of your workforce, addressing identified skill gaps and fostering career growth.
Succession Planning: Identify high-potential employees and create succession plans for critical leadership and key roles within the organization. This serves as your internal talent pipelines to ensure a smooth transition when vacancies arise.
Performance Management: Establish a performance management system that links individual and team goals with organizational objectives. Consistently provide feedback and coaching to support employee growth and goal achievement.
Talent Acquisition: Implement recruitment strategies tailored to attract and select the right talent. Do this in connection with assessing your compensation strategy to ensure that you are able to attract and retain key talent consistent with current market demands.
Monitor and Adjust: Continuously monitor and evaluate the progress of your workforce strategy using established metrics and key performance indicators (KPIs). Be prepared to adapt and refine your strategies as needed to address changing circumstances or challenges.
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