How Strategic Workforce Planning Boosts Revenue

How Strategic Workforce Planning Boosts Revenue

The basic question constantly facing every enterprise organization is, do you have enough workers to meet your demand? Both your current demand, and the demand you’re planning for?

So traditionally, planning has always been determined by, and follows, what those internal demands are.

What are the objectives that your project portfolio is designed to deliver on, around the expansion of your business, new services, ideations and growth targets? What’s your resource capacity, and how do you go about managing those resources so that you can also deliver on your transformation and change programs internally?

Strategic workforce planning is proactive

In other words, resource capacity planning is invariably reactive, and is determined by whatever those internal demands are. What strategic workforce planning says is that everything needs to be looked at together, from the very beginning. So that project portfolio management is just one of many elements that determine how successfully you respond to demand.

One of the perennial problems that organizations face, and one of the main reasons they often fail to meet their revenue targets, is that people end up doing things they shouldn’t have been asked to. All too often, they find themselves working on projects in a capacity that they weren’t trained for, or that they’re over-qualified for.

Which is one of the reasons there is such a major problem around labor shortages and the sheer volume of employee churn and turnover.

Combining workforce with business strategy

This is the shortcoming strategic workforce planning has been designed to redress. As the Irish government summarizes it in their 2020 guide1,

“Workforce Planning is the pro-active management of your current and future workforce composition to support the delivery of your organisation’s business strategy.”

There are three areas you need to focus on in order to put that strategy in place.

  1. Set your business objectives

First you have to establish what your organization’s core objectives are. What are your most important goals? Then you need to look into what the priorities are in each of your individual departments and business units, to make sure that they’re aligned with those organizational goals. Because this will determine how they go about planning their individual operations.

  1. Analyze internal and external labor markets

Next you need to look at trends in the labor market, and the impact they’re having both internally and externally. Internally, you need to establish a network of stakeholders tasked with monitoring skills capacity across the organization. What are the areas that you succeed and struggle in? That way, you’ll be able to compile an inventory of your skills capacity, even if it’s only an approximate one.

While externally, you need to explore and be aware of underlining trends as they arise in whichever sector it is that you operate. And to then monitor how those trends are impacting on your organizational goals, and those of the various business units.

  1. Assess talent needs

Once you have an inventory of your skills capacity, you can assess how well it aligns with your business goals and your organizational objectives. This will involve input and feedback from business unit leaders and middle management to identify where the most serious gaps are. So you can factor that in to your planning, beforehand and as you progress.

It’s an organic process

The central point about strategic workforce planning is that it’s an ongoing, continuous process. The software that you use to gather and collate all that data needs to be able to manage all of that in a dynamic, fluid way. It’s no good if it’s designed to operate in a fixed, static way. Because strategic workforce planning is, by its very nature, organic.

The people you have working for you, their skill sets, what they’re capable of doing and what they’ve been assigned to do is constantly evolving and changing. So strategic workforce planning has to be agile and flexible, to reflect that reality. And the right software will keep all of that constantly updated, and in real time.

You’ll then be able to take that real time, real performance data, and combine it with forecasted and anticipated work, to see how various different scenarios play out. What would happen, for instance, if you won five of the larger contracts you’ve bid for?

What resources, suppliers, etc. would you need, and how seriously would your current resources be depleted? What would happen, month on month, week on week, if X happened, or Y?

You need to be able to track baselines, performance and operation models and assign budgets accordingly. And your software needs to be able to track all of these metrics in a dynamic and fluid way.

The right software enables you to put a strategic workforce plan in place, so that the right people with the right skills work on the right projects. Because when your employees are deployed where and when they can be most productive, your margins and revenue will improve significantly.

Find out how Strategic Capacity Management by Cora helps with strategic workforce planning.

Source

1 Our Public Service 2020 Strategic Workforce Planning Guide published by the Irish Department of Public Expenditure and Reform, 2020