Workforce Planning Remains Largely Unaddressed Global Challenge

By Pamela Babcock Dec 23, 2007

Struggling to get management buy-in for workforce planning? Feeling a bit ill-prepared for the potential loss of skills, knowledge and leadership looming over the next five years?

Join the crowd.

Only 14 percent of organizations around the world report they’re ready for the future brain drain, according to a recent global workforce planning study done by The Infohrm Group, a workforce planning, reporting and analytics firm with offices in Washington, D.C., London, and Brisbane, Australia.

The news is bleakest if you’re in North America: While 22 percent of Asia-Pacific firms reported being prepared to “a large or very large extent,” only 10 percent of U.K. and other European respondents and a paltry 6 percent of North American firms said the same.

“As you look across all the measures we looked at in terms of whether this is a process they’re using, whether they’re satisfied with it and if they’re using longer-range scenarios, North America lags significantly behind in every area,” said Jeff Higgins, Infohrm’s Los Angeles-based executive vice president of client services. “These issues are widespread around the globe, but a few countries have been more proactive than others in seeking to manage it.”

Workforce planning benefits include the ability to identify and staff a workforce better by creating targeted recruitment strategies and to better allocate resources within the firm, all of which can lead to significant cost savings, improved efficiencies and increased productivity.

While North American organizations are “increasing their sense of urgency surrounding workforce planning,” Higgins said, the issue is “as severe or perhaps more severe than it’s been. This is an area that companies in North America need to focus on. They need to dedicate resources and they need the resources, which is something HR grapples with.”

The study, titled Global Approaches to Workforce Planning: What is Working?, culled data from 187 small, medium and large organizations. It was the first of what Infohrm expects to be annual survey on the topic, according to Higgins.

Other Key Findings

Seventy-nine percent of companies reported a big gap in their talent pipeline, and 40 percent of executives rate the problem as “acute.” Only 24 percent reported having “to a large/very large extent” a formal workforce planning process; 43 percent report having a formal process “to some extent.” This leaves 33 percent with little to no workforce planning.

The study found that firms that are prepared for the potential loss are much more likely (42 percent compared to 8 percent of under-prepared firms) to do formal workforce planning processes integrated with strategic business planning.

And while thought-leaders have long recommended focusing workforce planning on critical job roles, prepared organizations are planning for all job roles—a finding that reportedly has significant implications for human capital resource allocation.

Survey comments indicate planning is more mature in some business units than others.

  • “We have a greater focus on workforce planning in our customer call centers,” said one respondent.
  • “Workforce planning has been left primarily to individual general managers at the individual business site,” said another respondent.

Infohrm doesn’t recommend a one-size-fits-all workforce planning process, but it encourages firms to consider a range of approaches consistent with “the maturity and context of individual business units,” taking into consideration factors such as:

  • Strategic maturity of senior and line managers.
  • Existence and quality of strategic business planning and analysis.
  • Nature of anticipated workforce shortages.
  • Other priorities within the organization/business unit.
  • Availability of supply data.

Tackling the Workforce Planning, Analytics Challenge

Infohrm makes several suggestions in the study that can help organizations develop their workforce planning process, depending on where they stand with their program implementation. For example, companies just getting started on their process should:

  • Prepare a business case for the workforce planning initiative. Consider doing a “dummy” demand/supply/gap forecast to highlight likely challenges.
  • Avoid one-size-fits-all approaches to planning. Internal stakeholders’ differences and comfort levels will drive the process. Start where managers and others in the organization are most comfortable, then proceed incrementally to improve the process.

If a workforce planning process is already under way, companies should:

  • Ensure that the process is integrated with other strategic business and people management planning processes.
  • Review role coverage. If companies focus only on critical job roles, are they ignoring the opportunity to develop and deploy non-critical roles in critical positions?
  • Review the planning horizon to ensure it is sufficiently long term.
  • Deploy comprehensive workforce planning processes, from well-researched environmental scanning to reviews of human capital strategies.

There are lots of systems and tools being built to meet the market need in workforce planning, said Higgins, who likens them to aircraft like 747s—complex, high-performance machines.

“This is fairly complicated stuff, and, if it was really easy, everyone would be doing it. It’s like the early days of flight, [when] the technology was there to build a 747,” explained Higgins, who said that at the time no one was trained to pilot the complex aircraft.

The real gap that exists—even among companies that are trying to do this and more so among those that aren’t—is that companies are buying all these great systems and tools but they have no one who can use them.

“[At Infohrm,] we’re really trying to help companies train [their] pilots.”

Pamela Babcock is a freelance writer based in the New York City area.

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