HR Basics: Workforce Planning
Summary
TLDRThis video script delves into the fundamentals of Workforce Planning, a critical HR management process that aligns labor demand with supply to meet an organization's objectives. It covers identifying workforce issues, forecasting needs, and implementing strategies to ensure the right skills are available at the right time. The script highlights the importance of considering external factors, such as economic cycles and labor market conditions, and internal factors, like employee demographics and performance data, to create a comprehensive workforce plan that supports the organization's mission and goals.
Takeaways
- 📘 Workforce Planning is essential for aligning an organization's staffing needs with its current and future objectives.
- 🔄 It involves balancing labor demand with labor supply, which is influenced by economic cycles and market conditions.
- 📊 The process includes identifying the current workforce status, setting future workforce goals, and implementing actionable plans.
- 🌐 External factors such as economic conditions and industry trends significantly impact workforce planning.
- 📈 Internal factors like employee demographics, skills, performance, and turnover rates are crucial for evaluating workforce strengths and weaknesses.
- 🔍 An audit of current jobs and capabilities is necessary for forecasting future job requirements and potential labor supply.
- 📝 Replacement charts and succession planning are tools for identifying and preparing potential replacements for key positions.
- 🔄 A transition matrix helps track the movement of employees within an organization, aiding in understanding internal workforce trends.
- 🏢 Organizational culture can affect the strategies used to address labor shortages or surpluses and the reactions of employees to these strategies.
- 📉 Productivity is measured by the output relative to inputs, and understanding the productivity ratio helps in planning for different scenarios.
- 🔮 Strategic Workforce Planning typically covers a 3-5 year forecast period and includes scenario planning to prepare for various business outcomes.
Q & A
What is Workforce Planning?
-Workforce Planning is the process of ensuring that individuals with the right skills are where they need to be, at the right time to meet a firm's current and future staffing needs.
How does a company balance labor demand with labor supply?
-Companies balance labor demand with labor supply by considering factors such as economic conditions, interest rates, inflation, and unemployment rates, which affect the availability of workers and the demand for labor.
What are the key components of a workforce plan?
-The key components of a workforce plan include strategy, goals, and actions. Strategy is the execution of an organization's mission, goals are statements of desired outcomes, and actions are the steps taken to reach those goals.
How does the economic cycle affect Workforce Planning?
-The economic cycle, with its phases of recession and boom, affects Workforce Planning by influencing the availability of workers and the demand for labor. For example, in a high unemployment market, there may be more qualified applicants, but they might accept lower pay and benefits.
What is the role of geographic and competitive factors in Workforce Planning?
-Geographic and competitive factors play a role in Workforce Planning by affecting the supply and demand of labor. Managers must consider local labor market conditions, economic trends, and industry-specific factors when formulating workforce plans.
How does an organization evaluate its internal workforce strengths and weaknesses?
-An organization evaluates its internal workforce strengths and weaknesses by conducting a job audit, analyzing current job requirements, and comparing the needs of the organization to the existing and potential labor supply.
What is employee turnover and how does it impact labor demand?
-Employee turnover refers to the voluntary and involuntary termination of employees within an organization. It impacts labor demand by either creating a need for new employees (involuntary turnover) or reducing the need (voluntary turnover).
What is the purpose of a replacement chart in Workforce Planning?
-A replacement chart is used to identify potential replacement employees for positions that could open up within an organization. It helps companies be prepared to make personnel changes quickly and efficiently.
How does succession planning differ from replacement charts?
-Succession planning focuses on identifying employees who might be viable successors for top management positions, whereas replacement charts are used to identify potential replacements for various positions within the organization.
What is a transition matrix and how is it used in Workforce Planning?
-A transition matrix is a tool used to track the movement of employees throughout an organization over a certain period of time. It helps managers understand internal movement trends and plan for future staffing needs.
How does a company's organizational culture influence its Workforce Planning strategies?
-A company's organizational culture affects its Workforce Planning strategies by influencing the tactics used to deal with labor shortages and surpluses, as well as how employees react to those tactics. For example, companies with paternalistic values might be hesitant to implement layoffs.
What is the significance of understanding the productivity ratio in Workforce Planning?
-Understanding the productivity ratio allows a company to plan for different potential scenarios and reflect the growth or decline in the demand for its products. It helps in determining the labor demand needed to achieve a certain output level.
What is the typical time frame for strategic Workforce Planning?
-Strategic Workforce Planning usually covers a three to five-year forecast period, aligned with business needs and outcomes. It focuses on identifying workforce implications for current, transitional, and future business objectives.
Outlines
📈 Workforce Planning Essentials
This paragraph introduces the concept of Workforce Planning as a crucial balancing act for companies to align labor demand with supply. It emphasizes the importance of having the right people with the right skills at the right time. The paragraph explains that workforce planning involves understanding current realities, envisioning future workforce needs, and implementing measurable actions to achieve those goals. It also touches on the influence of external factors such as economic cycles, interest rates, and inflation on workforce availability, and the need to consider these when formulating organizational plans. The summary highlights the significance of internal workforce analysis, including employee demographics, career progression, education levels, performance data, and turnover rates, which are vital for effective workforce planning.
🛠 Tools for Strategic Workforce Management
This paragraph delves into the tools and strategies managers can use for effective workforce planning. It discusses the challenges of managing internal and external labor factors, including labor shortages and surpluses, and the impact of business strategies on coping with these issues. The paragraph introduces replacement charts and succession planning as methods to identify potential replacements for positions and successors for top management roles. It also mentions the use of transition matrices for tracking employee movement within an organization. Furthermore, it highlights the importance of job design in adding value to the company and the influence of company size, stage of development, and organizational culture on workforce planning activities. The summary underscores the role of productivity ratios in planning for different scenarios and the alignment of strategic workforce planning with business objectives over a forecast period of three to five years.
Mindmap
Keywords
💡Workforce Planning
💡Labor Supply and Demand
💡Strategic Execution
💡External Workforce Availability
💡Internal Workforce Analysis
💡Employee Turnover
💡Replacement Charts
💡Succession Planning
💡Transition Matrix
💡Productivity Ratio
💡Strategic Workforce Planning
Highlights
HR basics is a series of short courses focusing on essential human resource management topics.
Workforce Planning is introduced as a process to ensure the right skills are available at the right time to meet staffing needs.
The concept of balancing labor demand with available labor supply is central to Workforce Planning.
Labor demand and supply are defined as the number of employees needed and the availability of potential employees, respectively.
Workforce Planning involves understanding current workforce reality and envisioning the future workforce.
Strategy and goals are identified as key components for executing an organization's mission and desired outcomes.
External workforce availability and internal workforce characteristics are highlighted as important factors in Workforce Planning.
Economic factors such as interest rates, inflation, and economic growth influence workforce availability.
The difference in finding qualified applicants in varying unemployment markets is discussed.
Geographic and competitive concerns are considered in examining the external workforce.
Internal workforce availability is influenced by factors such as job analysis and existing capabilities.
An audit of expected jobs in the planning period is essential for evaluating internal workforce strengths and weaknesses.
Employee demographics, career progression, education, training levels, and performance data are important for workforce analysis.
Employee turnover, both voluntary and involuntary, is a critical factor affecting labor demand.
Alignment of human resource strategy with workforce planning goals is emphasized for effective planning.
Labor shortages and surpluses are defined and contrasted in terms of supply and demand dynamics.
Replacement charts and succession planning are presented as tools for identifying potential replacement employees and successors.
Transition matrix is introduced as a method for tracking employee movement throughout an organization.
Job design is discussed as a critical aspect of Workforce Planning, focusing on task structuring and value addition.
The impact of company size and stage of development on workforce planning activities is highlighted.
Organizational culture's influence on dealing with labor shortages and surpluses and its effect on employee reactions is discussed.
Productivity is defined in terms of output relative to inputs and its importance in workforce planning is explained.
Strategic Workforce Planning is described, covering a forecast period and focusing on identifying workforce implications.
Scenario planning is mentioned as part of strategic Workforce Planning to prepare for different potential outcomes.
Transcripts
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HR basics is a series of short courses
designed to highlight what you need to
know about a particular human resource
management topic in today's HR basics we
explore Workforce Planning how to
identify current workforce issues
forecast future needs and implement a
plan to ensure those needs are met
workforce planning is the process of
making sure that individuals with the
right skills are where they need to be
at the right time to meet a firm's
current and future staffing needs in
many ways Workforce Planning is an
ongoing balancing act companies must
balance the demand for labor with
available labor supply Workforce
Planning is dependent on labor supply
and demand labor demand refers to the
number and types of employees the
company needs to meet its current and
future objectives labor supply refers to
the availability of current or potential
employees to perform a company's jobs
Workforce Planning includes identifying
where you are understanding your current
workforce reality where you want to go
identifying the vision for the future of
the workforce and how to get there
bringing the plan to reality through
measurable workforce action using this
process you'll develop the core elements
of a workforce plan strategy is the
execution of an organization's mission a
bridge between the organization and its
environment goals are a statement of
desired outcomes towards which effort is
directed to realize your workforce plan
and actions are the most important
things that can be done to reach your
stated workforce goals Workforce
Planning requires attention on external
workforce availability and
characteristics of the internal
workforce which are impacted by a number
of factors the general economic cycle of
recession and boom effect Workforce
Planning factors such as interest rates
inflation and economic decline or growth
affect the availability of workers
and should be considered when
organizational and workforce plans and
objectives are formulated there is
considerable difference between finding
qualified applicants in four percent
unemployment markets compared to nine
percent unemployment markets as the
unemployment rate rises the number of
qualified people looking for work
increases which often makes it easier
for companies to fill some jobs however
the people who are hired may receive
lower pay and benefits because companies
have more hiring options and leverage
when making workforce plans employers
must consider a number of geographic and
competitive concerns significant changes
in the workforce both in the United
States and globally must be considered
when examining the outside workforce
during planning shifts in the
composition of the workforce combined
with the use of different work patterns
have created workplaces and
organizations that are notably different
from those of the past workforce
planning requires attention on internal
workforce availability which is impacted
by a number of factors analyzing the
jobs that will need to be done and the
capabilities of people who are currently
available in the organization to do them
is the next step in planning the needs
of the organization must be compared to
the existing labor supply as well as the
potential labor supply available outside
the firm the starting point for
evaluating internal workforce strengths
and weaknesses is an audit of the jobs
that are expected in the planning period
a comprehensive analysis of the current
job provides a basis for forecasting
what jobs will be needed in the future
much of the data required for the audit
should be available from existing
staffing and organizational databases an
inventory of organizational skills and
capabilities may consider a number of
elements the following are especially
important individual employee
demographics including age length of
service in the organization and time in
the present job individual career
progression jobs held time in each job
education and training levels promotions
and other job changes and pay rates and
finally individual
performance data including work
accomplishment growth and skills working
relationships and so on employee
turnover which directly affects a firm's
labor demand includes the voluntary and
involuntary termination of employees
within an organization the primary
difference between the two types is
whether the turnover is initiated by the
company involuntary turnover or the
employee voluntary turnover the second
step in the workforce planning process
is figuring out where you want to go
aligning human resource strategy with
workforce planning goals and issues to
some extent managers can control
internal labor factors managers also
have to evaluate factors in the external
environment over which they have less
control these factors relate to the
local labor market economic conditions
and industry trends that impact the
supply and demand of goods services and
employees managers will take a vastly
different action to address labor
shortages and surpluses a labor shortage
exists when the demand for labor exceeds
the available supply of it or demand is
greater than supply in contrast a labor
surplus exists when the supply of labor
is greater than the demand for it so
supply is greater than demand different
business strategies such as these affect
how quickly firms must cope with labor
shortages and surpluses at any point in
time some parts of a company may be
facing shortages of employee talent
whereas others may have a surplus
companies use replacement charts to
identify potential replacement employees
for positions that could open up within
their organizations essentially a
replacement chart shows the employees
who could potentially be moved from one
job to another
if fakin cease occur with such a system
in place a company is ready to make
personnel changes on short notice
succession planning is similar to using
replacement charts but focuses on
identifying employees who might be
viable successors for top management
positions as the name implies succession
planning involves identifying who is
next in line for higher-level jobs it
also requires the company to fill in
information about any skill a potential
successor needs to develop a
well-defined succession process is
important for a variety of reasons a
third tool that managers can use to
understand the internal movement trends
of their workforces
is a transition matrix a transition
matrix provides a model for tracking the
movement of employees throughout an
organization rather than for a single
job over a certain period of time the
third step of Workforce Planning is
figuring out how to get there through
identification and actions including
metrics remember that job design does
the following focuses on decisions about
how jobs should be structured ensures
that job related tasks and activities
are performed in a way that has the most
potential to add value to the company
and its customers and the best design
jobs in the world have no value if
people are not in a position to perform
them in particular a company size and
stage of development will affect the
relative impact of labor shortages and
surpluses as well as who will carry out
the company's workforce planning
activities your responsibilities for
carrying out Workforce Planning
activities will vary depending on the
size and stage of development of your
company a company's organizational
culture affects the different tactics
firms use to deal with labor shortages
and surpluses as well as how their
employees react to those tactics some
companies have cultural values that
prevent them from fully pursuing a
particular course of action companies
that are very paternalistic or extremely
loyal to their employees might be
hesitant to implement layoffs even if
doing so makes sense any discrepancy
between the corporate culture of a firm
and the workforce tactics its managers
use is likely to result in a negative
reaction by a company's employees
productivity refers to the level of a
firm's output products or services
relative to inputs employees equipment
materials and so forth used to produce
the output up
productivity ratio reflects the number
of employees labor demand needed to
achieve a certain output level level of
sales production and so forth one of the
benefits of understanding the
productivity ratio is that it allows you
to plan for different potential
scenarios and reflect the growth or
decline in the demand for your products
strategic Workforce Planning usually
covers a three to five year forecast
period aligned to business needs and
outcomes it focuses on an identifying
the workforce implications current
transition and future of business
strategic objectives and includes
scenario planning
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