Workforce Planning: Connecting Business Strategy to Talent Strategy

Copyright © 2009. Korn/Ferry International Futurestep, Inc. All rights reserved.

Workforce Planning Connecting Business Strategy to Talent Strategy

Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Newman Group Overview

The Newman Group provides expertise and solutions to help companies align people, processes and technology and achieve success in all facets of talent management.


Should we be breaking down the silos?


Should we be breaking down the silos?

Strategy

Common Language (DNA)

Process Integration

Scalability (Tools)


Talent Management Framework

5

SYSTEM ENABLEMENT

Support & Sustain

Alignment

Alignment

CORPORATE VISION, CULTURE & STRATEGY

TALENT STRATEGY, ORGANIZATION & WORKFORCE PLANNING

COMPETENCY DEFINITION & ASSESSMENT

Talent Acquisition Succession Planning Organization Design/Development

Leadership & Team Development

Executive Recruitment

Performance Management

Compensation Planning

Learning & Development

Employee Engagement &

Retention

Support & Sustain

Proc

ess

Com

mon

La

ngua

ge

Scal

abili

ty

Stra

tegy

Support & Sustain

COMPETENCY DEFINITION & ASSESSMENT

Com

mon

La

ngua

ge

Scal

abili

ty


What is Workforce Planning?


Workforce Planning Study


Workforce Planning in Crisis Mode

67% of companies conduct workforce planning on an “as needed” basis…

  Relocation

  Mergers and acquisitions

  Change in leadership

  Change in company strategy

  Global expansion

  Diversifying the workforce


Top Challenges in Workforce Planning


Key Findings in Workforce Planning

  The majority of organizations are ineffectual at predicting future talent demands.

  Workforce planning fails when it is viewed as an HR issue rather than a business issue.

  The industries most heavily impacted by aging talent are also the same industries placing a heavy priority on strategic workforce planning.

  Strategic workforce planning will not happen overnight


The Workforce Planning Process

Define Objective

Project Demand

Evaluate Supply

Define the Gaps

Gap Management

Quantitative analysis of

critical employee data

elements

Headcount data

Financial data Overhead

Labor Training

Marketing data Critical roles for the go

to market strategy

Risk Mgmt/Budgeting data

Qualitative analysis to

determine key needs

Headcount needs

Financial needs Overhead

Labor Training

Marketing needs Critical roles for the go

to market strategy

Risk Mgmt/Budgeting needs

Scenario modeling

Gather the data from the

business plan or business strategy to

determine the direction of the workforce plan

Define and prioritize the

gaps between the qualitative demand and

the quantitative supply

Develop an action plan to close the gap

Build Development for

internal talent movement

Buy Acquire talent

externally

Borrow Augment headcount

with contract or temporary labor

Bounce Planned attrition


Workforce Planning Maturity Model


Basic: Traditional WFP


Further analyze T/O by category (voluntary/grade)


Intermediate: Workforce Analytics


Ordinary Metrics & Measures with WFP Lens

  Turnover

–  Typically we look at Voluntary vs. Involuntary

–  Focus is on reducing voluntary

  Performance Ranking

–  Typically 5 point rating scale

–  Often a forced distribution

  By looking at turnover data by performance category, you can create a Retention Index

–  Comparing the average turnover rate to the rate of turnover within a specific category


Retention Index

Performance Category

Performance Rank All

Far Exceeds Exceeds Meets

Needs to

Improve

Does not meet

# Employees 6500 300 1300 3500 1000 400

Total Turnover 1625 75 450 600 200 300

Turnover % 25% 25% 35% 17% 20% 75%

Retention Index 0% -10% 8% 5% -50%

Talent Leak

Formula: Ave Turnover % – Ave Turnover % in Demographic = Retention Index


Retention Index

Employee Tenure

Tenure All

More than

15 11-15 years

5-10 years

1-4 years

Less than 1 year

# Employees 6500 300 1300 3500 1000 400

Total Turnover 1625 25 200 700 550 150

Turnover % 25% 8% 15% 20% 55% 38%

Retention Index 17% 10% 5% -30% -13%

Talent Leak

Formula: Ave Turnover % – Ave Turnover % in Demographic = Retention Index


Scenario Modeling Example

Current Workforce Plan

Industry Trends

Political Developments

Labor Changes

New Business Strategies

Future Workforce Plan Impact


Advanced: Strategic Workforce Planning


Workforce Segmentation Example

Source: The Conference Board “Strategic Workforce Planning, Forecasting Human Capital Needs to Execute Business Strategy”; via Corning Incorporated

Roles that affect the strategy

Roles affected by the strategy

Strategic

Critical to driving long-term competitive advantage, with specialized skills or

knowledge

Core

The “Engine of the Enterprise,” unique to the company and core to delivering on its

products and/or services

Requisite

Cannot do without, but whose value could be delivered through alternative staffing

strategies (e.g. off-shoring, outsourcing, replace w/technology)

Non-Core

Talent whose skill sets no longer align with the company’s strategic direction

Potential Strategic Action Talent Segment and Value


Why is it so hard to get WFP off the ground?

  Because it comes at you from the top down

  But you need to build from the ground up


WFP Objective Forecast Demand

Evaluate Supply

Analyze

Gaps

Manage

Gaps

Business Strategy

Consistent Workforce Planning Methodology

Mining Internal & External Data

Operational Effectiveness

Target Critical Talent Sets

Operational & Strategy Drivers

Business Strategy and Operating Model

Knowledge Transfer

Age/ Retirement Analysis

Retention Management

Capability Management

Mergers & Acquisitions

Headcount Forecasting

Diversity Strategy

Level 1

Basement Level

Upper Levels

Window Views

Strategic Planning Lens: 18+ months

Restructure or Expansion

TM Strate

gy

Internal data warehouses or systems such as: HRMS, Financial Systems, ATS,

LMS, etc.

Environmental Trends such as: Competition, Labor supply, demographics, etc.

Operational Lens: Typically annual

Environmental

Influences


Building Workforce Planning Capability


COE Framework

Talent Management based on Applied Intelligence

HR Business Partners

Shared Services

Workforce Planning COE

You don’t have to make everyone an expert at WFP



Process

 Data Stabilization

–  Ensuring standards & consistency


Developing a strategic roadmap


Technology Landscape


29

Technology Landscape

External labor market:   Policymap.com   WorkforceLocator.org


Getting Started

  What is the annual business planning cycle?

  What additional level of talent planning will have the most impact?

  Who will embrace it?


Q & A

Email: [email protected] Visit us online at: www.tng.futurestep.com

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