Facing recessionary headwinds, CHROs & business leaders need to double down on strategic workforce planning as a value-preservation lever.
Today's rapidly evolving business environment is buffeted by uncertainty. It has increased the pressure on the HR function to ensure that their organizations have the requisite talent to support changing business priorities. A stubbornly tight labor market coupled with languishing inflation and high labor costs means that most companies don't have the runway to operate permanently in "react" mode when it comes to efficiently forecasting talent demand and bringing in the right quantity and quality of roles.
The Bad News
Too frequently, my colleagues and I will ask about our client's workforce planning processes only to be told some variation of, "We don't do that here".
And in many ways, it's easy to empathize with their situations; strategic workforce planning (SWFP) is hard, and it requires a tight interlock between HR, finance, business unit leads, and the executive team to execute effectively while balancing competing incentives. This is highlighted superbly well by some of our AlixPartners colleagues in their recent article The War for Talent (Part 1 of 5) where they note that "the search for [digital talent]. . . is a complex challenge intrinsically linked to a company’s ability to achieve its corporate objectives. . . the digital “gap” is one that companies must find a way to bridge, accepting it will also come with a bill that is difficult to balance." We fully agree with this statement, it’s only going to get more difficult for our clients to find the quality and quantity of human capital required to achieve their strategic objectives, especially in an environment where they are being asked to “do less with less”.
The Good News
We firmly believe that these daunting obstacles can be hurdled and that CHROs can make 2023 the year of strategic workforce planning by reviewing some of our recommended best practices. This starts by generating a baseline with a simple self-diagnostic we’ve created to assess SWFP maturity, to better gauge where a particular CHRO and his or her team & company are on their journey to implementing SWFP.
As the first installment of a three-part series, we will explore common obstacles that CHROs and their fellow C-suite stakeholders face trying to implement SWFP; and provide some best practices and traps to avoid to build a willing coalition of champions, prioritize initial steps and governance, and launch into establishing a strong SWFP foundation.
Sample Questions from SWFP Maturity Diagnostic
- Does HR engage in regular two-way forward-looking interactions with line partners to identify future strategic priorities and talent implications?
- Are workforce planning insights for the line customized and targeted for individual business leaders, and do they highlight financial implications?
- Does your organization monitor and update the workforce plan based on changes to the strategic direction of the organization?