Workforce planning

Workforce Planning
Reshaping the present. Reimagining the future

Value to the Customer
2
A value chain consists of a set of
activities involved in delivering
a ﬁnal product or service to a
company's or an organization’s
customers’ satisfaction…

! Your proﬁt margin is the Value
that you can create Minus the Cost of
creating that value…

How does your Company Create Value?
3

Primary activities relate directly to the physical creation,
sale, maintenance and support of a product or service.
•  Inbound logistics – processes related to receiving, storing, and
distributing inputs internally (Value creating factor is SRM)
•  Operations – These are the transformation activities that change
inputs into outputs that are sold to customers.
•  Outbound logistics – delivery of products or services
•  Marketing and sales – processes used to persuade clients to
purchase from you instead of your competitors. (beneﬁts offered,
and how well you communicate them, the CRM is the value here)
•  Service – These are the activities related to maintaining the value
of your product or service to your customers, once it's been
purchased. 4
Which Activities add Value and How?

Support Activities : are service providers to the primary
functions
•  procurement supports operations with certain activities, but it also
supports marketing and sales with other activities.
Procurement (purchasing) – involves needs assessment,
sourcing and negotiating best prices with vendors.
Human resource management – This is how well a
company recruits, hires, trains, motivates, rewards, and
retains its workers.
•  People are a signiﬁcant source of value, so businesses can
create a clear competitive advantage with good HR practices.
5

Support Activities Cont’d
Technological development – These activities relate to managing
and processing information, as well as protecting a company's
knowledge base.
•  Minimizing information technology costs, staying current with
technological advances, and maintaining technical excellence
are sources of value creation.
Infrastructure – These are a company's support systems, and the
functions that allow it to maintain daily operations. Accounting,
legal, administrative, and general management are examples of
necessary infrastructure that businesses can use to their advantage.
6

Step 1 – Identify sub activities for each primary activity,
which speciﬁc sub- activities create value;
•  Direct activities create value by themselves. For example, in a
book publisher's marketing and sales activity, direct sub activities
include making sales calls to bookstores, advertising, and selling
online.
•  Indirect activities allow direct activities to run smoothly. For the
same publisher's sales & marketing activity, indirect sub activities
include managing the sales force and keeping customer records.
•  Quality assurance activities ensure that direct and indirect
activities meet the necessary standards. For the book publisher's
sales and marketing activity, this might include proofreading and
editing advertisements.
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Using Porter’s Value Chain Model

Step 2 – Identify sub activities for each support activity.
ª  For each of the Human Resource Management,
Technology Development and Procurement support
activities, determine the sub activities that create value
within each primary activity.
ª  Then identify the various value-creating sub activities in
your company's infrastructure. These will generally be
cross-functional in nature, rather than speciﬁc to each
primary activity. Again, look for direct, indirect, and
quality assurance activities.
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Step 3 – Identify links
Find the connections between all of the value activities
you've identiﬁed.
•  This will take time, but the links are key to increasing
competitive advantage from the value chain framework.
o  For example, there's a link between developing the
sales force (an HR investment) and Sales volumes.
o  There's another link between order turnaround times,
and service phone calls from frustrated customers
waiting for deliveries.
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Value Chain : Public Sector
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Organizational Development
OD is a planned and systematic
approach to enabling sustained
organizational performance
through research, theory,
and practice dedicated to
expanding the knowledge and
effectiveness of its most
important resource, its’ people…
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Organizational Development - What
A system-wide process of data collection,
diagnosis, action planning, intervention, and
evaluation aimed at;
ü  enhancing congruence (gluing together) among
environment, resources, history |organizational
structure, process, strategy, people, culture and
systems (Inputs-Org Elements- Outputs)
ü  developing the organisation’s self-renewing capacity
through the collaboration of organizational members
working with a change agent using behavioral science
theory, research and technology 12

Why Org. Dev.? – Current State
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Organization
Low Produc*vity
High Turnover Inter Dept. Conﬂicts
Poor Alignment to Organiza*on’s Strategy
Unclear Goals
Poorly Designed tasks
Poor Team Performance
Fire Figh*ng Work Approach
Low Morale
Inappropriate leadership style
Interpersonal conﬂicts
Lack of Innova*on
Poor Customer Service
Loss of Market Share

Organizational Development - How
•  OD applies to changes in the strategy, structure, and/
or processes of an entire organization, a department
or work group, or individual role or job.
•  OD is based on the application and transfer of
behavioral science knowledge and practice (such as
leadership, group dynamics and work process
design), and is distinguished by its systematic
ability to transfer such knowledge and skill so that
the system is capable of carrying out more planned
change in the future.
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Organizational Development - How
•  OD is concerned with creation and managing
planned change, in a ﬂexible manner that can be
revised as new information is gathered.
•  OD is geared towards improving effectiveness by:
•  helping members of the organization to gain the
skills and knowledge necessary to solve problems by
involving them in the change process…
•  by promoting high performance including ﬁnancial
returns, high quality products and services, high
productivity, continuous improvement and a high
quality of working life. 15

Organizational Dev. - Cycle
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Credits : wwu.edu
Employee Input &
Discussion view points
Seek to Improve Eﬀec*veness
& solve opera*onal problems
People, the roles they
undertake, the systems and
culture within they operate
Change Management principles to
change deployment, stabiliza*on, and
the evalua*on loop for the next level of
organiza*onal development
Analy*cal ﬁndings are the base
for OD interven*ons planning

OD & HR
OD and its methods play a part in developing
HR’s strategic role and its involvement in
organizational change and culture.
•  OD work is based upon robust diagnosis that uses real
data from organizational, behavioral and psychological
sources.
•  OD work is planned and systemic in its focus and takes
account of the whole organization, views and culture.
•  OD practitioners help to create alignment between
different activities, projects and initiatives.
•  OD work involves groups of people in the organization to
maximize engagement, ownership and contribution.
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OD & HR
In deﬁning OD, and the associated skills
required by an HR professional, emphasis is
placed on the need to see OD as a continuous
review process rather than a one-off change
intervention.
•  OD requires sophisticated people management skills
and can enable HR to develop the deep
organizational insight required to ensure the
relationship between the business and its people
delivers win-win solutions for both.
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Avoid Workforce
Capacity Shortfalls
Reduce Workforce
Sourcing Costs
Create Effective
management
structures
Develop a
Competitive
Workforce
Outcome
Measure Churn rates
Workforce
Planning
Acquisition &
Movement
Workforce
Performance
Learning &
Development
Employee
Retention
Business Insights
1. HR Needs (Current & Forecasted)
2. Workforce Related Actions
1. Effectiveness of Recruiting Efforts
2. Workforce Migration
1. Efﬁcient use of Top Performers
2. Impact on Retention
3. Effective Management Structures
1. Efﬁcacy of Development Programs
2. Alignment of Progression to
Development
1. Turnover issues
2. Loss of Development Investments
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Human Resource Management & Development Strategy
Strategy

Organizational Objectives
The overall goals, purpose and mission of a
business that have been established by its
management and clearly communicated to its
employees.
•  Typically focus on its long range intentions
for operating and its overall business
philosophy that can provide substantial
guidance for employees seeking to add
value to the process ﬂow in their own areas.
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Profitability : Maintaining profitability means
making sure that revenue stays ahead of the
costs of doing business
•  Focus on controlling costs in both production and
operations while maintaining the profit margin on
products sold.
Productivity : Provision of all of the resources
your employees (training, equipment, materials,
financials) need to remain as productive as
possible.
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Customer Service (CRM)
Clear customer service levels help retain clients
and generate repeat revenue.
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Change Management : is the process of
preparing your organization for dynamic but
sustainable growth and creating processes that
effectively deal with a developing marketplace.
Marketing : more than creating advertising and
getting customer input on product changes.
It is understanding consumer buying trends, being able to
anticipate product distribution needs and developing
business partnerships that help your organization to improve
market share.
23

Human Resources
objectives cover organizational structure,
culture, stafﬁng needs, employee training, talent
development and productivity improvement
goals as well as reduction of employee turnover
by introducing new employee assistance
programs.
•  Maintaining a productive and positive employee
environment improves retention
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Organizational Structure
Departmentalization is an aspect of organizational
design that includes the subdivision of a business
into units based on their function or other criteria.
Standard methods of departmentalization include
grouping jobs by;
•  Functional activities
•  Product types
•  Customer groups
•  Geography or location
•  Processes
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Org. Structure : Departments
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a.  Functional departmentalization—jobs are
grouped by the functions (i.e., marketing, ﬁnance,
human resources) performed.
•  Can be used in all types of organizations, although
the functions change to reﬂect the organization’s
objectives and work activities.
b.  Product (or Service) departmentalization—jobs
are grouped by product line.
•  Here, each major product area is placed under the
authority of a manager who’s a specialist in, and is
responsible for, everything having to do with that
particular product or service line.

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c.  Geographical departmentalization—jobs are
grouped on the basis of a territory or geography such
as; Midwestern or northwestern regions for an
organization operating only in the United States; or for
a global company, maybe U.S., European, Canadian,
MENA and Asian-Pacific regions.
d.  Process departmentalization—this method groups
specialized process jobs on the basis of product or
customer flow.
•  In this approach, work activities follow a natural
processing flow of product or even customers.

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e.  Customer departmentalization—jobs are grouped
on the basis of common customers who have
common needs or problems that can best be met by
having specialists for each.
In an organizational structure, “chain of command”
refers to a company's hierarchy of reporting
relationships -- from the bottom to the top of an
organization, who must answer to whom.
•  The chain of command not only establishes
accountability, it lays out a company's lines of
authority and decision-making power.

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Pyramid/Hierarchy : Centralized
An organization using a pyramid or hierarchy structure
has a leader who is responsible for and makes all the
decisions affecting the organization as well as manages
other organizational members (Functional heads).
Matrix
Matrix organizations assign employees to two reporting
lines; One hierarchy is functional and assures that
experts in the organization are well-trained and assessed
by bosses who are highly qualiﬁed in the same areas of
expertise. Another is executive and works to ensure the
experts bring speciﬁc projects or goals to completion…

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Matrix Structures : Cont’d
•  Weak/Functional Matrix: A project manager with limited
authority is assigned to oversee cross-functional aspects of the
project. Functional managers maintain control over their
resources and project areas.
•  Balanced/Functional Matrix: A project manager is assigned to
oversee the project. Power is shared equally between the project
manager and functional managers, combining the best aspects of
functional and project-oriented organizations. This system is the
most difﬁcult to maintain because of difﬁculties in power-sharing.
•  Strong/Project Matrix: A project manager is primarily
responsible for the project. Functional managers provide
technical expertise and assign resources as needed.

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Ecology : Decentralized
Each business unit (operating autonomously with clearly
defined, measureable goals) represents an individual profit
center that holds employees accountable for the unit's
profitability.
•  These kinds of organizations foster intense
competition, as all members are paid for the actual
work they perform.
•  Ineffective parts of the organization are left to fail
and thriving parts are rewarded with more work.

Org. Structure : Functional
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Org. Structure & Strategy
Business strategy is a practical plan for achieving an
organization's mission and objectives.
Strategic management is the comprehensive collection
of ongoing activities and processes that organizations
use to systematically coordinate and align resources and
actions with mission, vision and strategy throughout an
organization
Organizational structure is the formal layout of a
company's hierarchy.
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McKinsey 7S Model
The Hard elements (red
circles) are feasible and easy to
identify. They can be found in
strategy statements, corporate
plans, organizational charts
and other documentations.
The Soft S’s are capabilities,
values and elements of
corporate culture are
continuously developing and
changing.
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McKinsey 7S Model
The Hard S’s
Strategy: Actions a company plans in response to or
anticipation of changes in its external environment.
Structure: Basis for specialization and co-ordination
inﬂuenced primarily by strategy and by organization
size and diversity.
Systems: Formal and informal procedures that
support the strategy and structure. (Systems are more
powerful than they are given credit)
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McKinsey 7S Model
The Soft S’s
Style/Culture: Org. Culture/Management Style
•  Organizational Culture: the dominant values and
beliefs, and norms, which develop over time & become
relatively enduring features of organizational life…
•  Management Style: more a matter of what managers do
than what they say; How do a company’s managers spend
their time? What are they focusing attention on?
Symbolism – the creation and maintenance (or sometimes
deconstruction) of meaning is a fundamental
responsibility of managers
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The Soft S’s
Staff: People/Human resource management – processes
used to develop managers, in-house networking, shaping
of basic values, new staff orientation, helping to manage
employee careers.
Skills: The distinctive competences – what the company
does best, ways of improving or shifting competences
Shared Values / Superordinate Goals: Guiding
concepts, fundamental ideas around which a business is
built – must be simple, usually stated at abstract level,
have great meaning inside the organization even though
outsiders may not see or understand them.
McKinsey 7S Model

Strategic Vs Workforce Planning
Strategic HR Planning considers the business
risks concerning insufficient, disrupted, mis-
deployed talent as organization’s business priorities.
Workforce planning is considered an iterative
discipline (repetition while seeking continuous
improvement) .
•  The cycle of workforce planning includes filling
resource requests, analyzing resource utilization,
forecasting capacity, managing and identifying the
resources (human) to fill that capacity gap (supply/
demand), and then re-starting the cycle.
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Strategic Planning : Key Business Drivers
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Key Business Driver : A resource, process
or condition that is vital for the continued
success and growth of a business…
Sample
Drivers

Workforce Planning : Definitions
Chartered Ins*tute of
Personnel and Development
A Core Process of the Human Resource Management
function shaped by the organizational strategy that
ensures the right number of people with the right skills
are employed in the right place at the right time to
deliver the organisation’s short & long-term objectives
and vision….yes at the right cost!
•  Succession planning
•  Labour demand and supply forecasting
•  Recruitment and Retention planning
•  Skills audit gap analysis
•  Multi-skilling & Career planning
•  Risk management
•  Outsourcing 41

Can also be deﬁned as the continuous planning
process of shaping and structuring the workforce to
ensure there is sufﬁcient and sustainable capability
to meet organizational objectives now and in the
future.
Key considerations in planning;
•  What is the current situation ~ where are we now?
•  What are the future requirements ~ where are we headed?
•  What is needed to bridge the gap ~ how do we get there?
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Operational workforce planning functions on a
person-to-person level and streamlines employee-related
operations day by day.
•  Optimizing work schedules and employee hours
•  Optimizing the distribution of talent among divisions
and departments
•  Identifying functional needs and hiring new workers to
meet those needs
•  Identifying obsolete functions and reassigning workers
as necessary
•  Ensuring the greatest possible overall worker job
satisfaction
44

Strategic workforce planning deals with broad-based
issues that evolve over months and years and can
encompass all the aspects of an enterprise.
•  Forecasting knowledge drain as employees leave
(or age out)the organization
•  Forecasting future talent needs
•  Determining and evaluating likely future
sourcing options
•  Implementing an effective workforce analytics
strategy
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Credits : FAHR_AE

WP & HR : Why all the noise?
Aging Workforce : shortage of new skills and increasing
tide of ‘boomers’ reaching retirement
Globalization : companies now have multiple
international locations to plan for, source, manage and
also integrate into the strategic processes
Contracting & Outsourcing : need to know when,
how and where to be included in workforce planning
while keeping inline with the local cultural, legislative
and statutory policy.
47

WP & HR : Why all the noise?
Mergers & Acquisitions : may increase the
number of workers with similar skill sets but
company may lose them in transition
Enhanced Technology (Robotics) : replacing one
skill set but creating a need for another
Critical Industry Needs : Public Sector,
Healthcare, Technology, Energy…
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Workforce Planning & HR

Talent acquisition as well
as strategic positioning,
development, and
subsequent retention are
key HRM/D areas that
begin with considering all
potential access sources
(employment, out sourcing,
partnerships, changing
business activities to
modify the types of talent
required, etc.).
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G
A
P
Strategic
Business
Planning
HR
Strategies
Workforce
Planning
Address Gaps
Set Priori*es
Iden*fy Gaps

Strategic Workforce Planning : Drivers
1.  Find the Right Champion/Project Leader
Strategic Workforce Planning (SWP) requires credible and
influential champions to drive, support, and sustain a change
in evolving markets.
•  While a strong HR professional can be an effective
champion in some organizations, experience has shown
that a champion from the business side is critical.
2.  First, Believe … Then Execute and Evaluate
Organizations that implement SWP have a fundamental
belief that a more strategic, rigorous, and data-based
approach to workforce planning is critical to strategy
execution and, ultimately, yielding of significant benefits.
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3.  Talent Segmentation is a Disciplined Art, Not an
Exact Science : Figuring how to segment job roles
isn’t the same as segmenting people.
•  It’s important to look at talent and how to determine which
roles are critical for driving your ﬁrm’s long-term
competitive advantage.
4.  Sound Judgment Is Still Required
Think SWP is a cure-all? It’s actually a decision-support
mechanism—not a decision-making expert system.
•  Rely on SWP to uncover data, disconnects, trouble spots & to
zero in on potential opportunities and make better business
planning decisions.
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5.  Integrate with other Key strategies
SWP can’t stand alone. For success and long-term
sustainability, it’s important to make sure you link it with
other processes such as strategic planning, operations
planning, and talent development.
6.  Human Resources Sets the Table
An organization’s leaders play a critical role in SWP. But
HR is just as important in supporting and facilitating any
implementing and ongoing management. So be sure to
engage across functions to drive business performance.
52

An organization’s ability to learn, understand, and
transform new ideas into action rapidly (from
Strategic to Tactical Level) is the ultimate competitive
advantage… Jack Welch, Former CEO, GE
Creating Competitive Advantage….
53

SWP : Benefits
ü  Creates a clear view of talent demand and supply
issues by expense area, reporting relationship, and
by location.
ü  Provides managers easy-to-use reports and tools to
determine the impact of their talent decisions and
prioritizes future workforce investments.
ü  Provides leaders the right metrics—identifying
talent risk before it impacts business objectives.
ü  Provides a mechanism for monitoring costs and
directly linking expenditure of personnel against
business outputs and outcomes.
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SWP : Benefits
ü  Helps control unplanned talent costs and highlights
issues that limit employee productivity.
ü  Builds competitive advantage through Proactive
rather than reactive talent management.
ü  Improve efficiency, effectiveness and productivity
(employees possess the right skills and are a good fit
for the job)
ü  Facilitate strategic staffing and planning for future
workforce requirements (can identify staffing needs
in a timely manner, monitor attrition and ensure
replacements are available to fill key vacancies)
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SWP Considerations : Demographics
(The Generation Mix)
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Baby Boomers
Born : 1945 – 1964
Shaped by : Less Trust in
Government
Genera*on X
Born : 1965 – 1980
Shaped by : internet,
diversity, parental divorce
rates, unemployment
Genera*on Y
Born : 1981 – 1994
Shaped by : informa*on
overﬂow, globaliza*on
Genera*on Z
Born : 1995 – 2010
Shaped by : Tech savvy,
strong work ethic
Genera*on Alpha
Born : 2010 +
Even more tech savvy
More in numbers due to
birth spike
Most formally educated

SWP : Steps
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Translate
Business Strategy
into Value drivers
Current Workforce
Analysis
Forecasting
Future Workforce
Demandvs. supply
Identify and
Analyze Gaps
Develop
Strategies
Implement Talent
strategy to close
Gaps
Monitor &
Evaluate
Iden*fy values drivers (e.g. cri*cal
ac*vi*es, func*ons and processes)
to achieve the business strategy
Analyze workforce against org.
direc*on, internal workforce
characteris*cs and capabili*es,
external labour market and
environmental factors
Determine headcount
demand vs. supply in
each role, while
factoring both internal
and external labor
market dynamics
The gaps between future
workforce needs and current
workforce profile are
iden*fied and analyzed
Integrated business and HR
strategies are developed to
address the gaps between
current and future workforce
needs
Investment in
strategies and change
management
processes to address
workforce planning
issues
Strategic
Workforce
Planning
Effec*veness of strategies
is evaluated to determine
success of planned changes
and impact on business
performance

SWP : Steps
1.  Understanding the organisation’s strategic direction
and its impact on the workforce
2.  Analyzing the current and Forecasting the future
workforce needs and competencies
3.  Analyzing the gap between the current and future
needs
4.  Developing strategies to address workforce gaps
5.  Implementing strategies to align the workforce
with future business needs
6.  Evaluating and Monitoring the success of the
workforce planning strategies in meeting objectives
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SWP : Critical Issue of Scope
Before starting any SWP effort, the organization
needs to determine the scope of their workforce
plan (either entire workforce or limited segment).
•  This involves identifying which jobs or areas of
the workforce to be analyzed;
o  Mission-critical occupations, key employees/
roles or branches
o  Occupations and skills that are difﬁcult to
recruit or retain
o  A particular strategy to ensure that the right
people are available to get particular work done
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SWP : Critical Issue of Scope
" Will it be difﬁcult to replace some of the people who
are likely to retire soon?
" Do these people have signiﬁcant relationships with
key stakeholders?
" Are they critical to the development or maintenance
of intellectual capital?
" Do they represent a major, important component of
the corporate culture?
" Are their skills transferable?
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Some Key Questions to determine the Scope will include but not limited to;
?

Scope : Workforce Segmentation
HR professionals separate the various components of their
organization's workforce in order to ﬁt policies and
practices to each particular segment.
•  Such customizations impact recruitment, training and
development, compensation, succession and
outsourcing
•  The Traditional model is based on job evaluations, and
salary levels which may result into SWP problems.
o  This model serves as a basis for accountability/
responsibility, decision-making and limits of authority, but
it is not an appropriate for developing tailored attraction,
engagement and workforce retention strategies.
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a)  The Traditional (hierarchy based) segmentation
model has several flaws which include;
o  a waste of resources (e.g., could include paying the
wrong people too much and the right people too little)
o  operational inefficiencies and poorer performance by
having inexperienced people in important roles
o  salary levels are more a reflection of market forces
and internal equity which may not necessarily reflect
the true value of the importance of the role in terms of
value creation, competitive advantage and their
impact on business outcomes
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b)  The Skills Based segmentation model takes into
account both the value & uniqueness of skills relative
to role…
1.  Criticals (with a turnover multiple of between 1 – 2.5)
2.  Professionals, Skilled (T/O multiple of between 0.5 – 1)
3.  Doers (with a turnover multiple of between 0.3 – 0.5)
4.  Specialists (with a turnover multiple of between 1 – 1.5)

•  Each of these role types has a different psychological contract (or
employer/employee relationship or “deal”/Employment Value
Propositions {EVP}), with different levels of investment in
employees, and different turnover cost implications.
63

Scope : Skills Based Segmentation
64

Scope : Skills Based Segmentation
65
Identifying Critical Roles (valuable and unique skills)
•  Roles come ﬁrst before taking into consideration the
people occupying those roles (e.g., capability,
development needs, engagement, retention risk)
Outsourcing Roles
•  Roles residing in quadrants 2 and 3 are more
amendable to outsourcing considerations. These roles
are also likely to be “buy” (i.e., acquire ready made
from the market), rather than “make” (i.e., develop
from within including the associated investment – 1
and 4) roles

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HR Policies and Practices by Workforce Segment

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Sample Analysis and Classiﬁcation of Roles by Skills’

Turnover Cost : Looking at the Numbers
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CRITICALS PROFESSIONALS DOERS SPECIALISTS
#Staﬀ 50 175 150 30
Annual Voluntary
Turnover
12% 15% 17% 7%
6 Lej 26 Lej 25 Lej 2 Lej
Average Salary $180k $100k $50k $80k
T/O mul*ple 2 0.5 0.3 1.5
Cost of T/O per Annum
(T/O multiple*Av.Salary*Annual T/O)
$2.16m $1.3m $.375m $.24m
The cost of 6 Criticals leaving ($2.16 million) is much more significant than the cost of 26 Professionals
leaving ($1.3 million) and 25 Doers leaving ($0.375 million). Hence the need to calculate the cost of turnover
on a workforce segment basis.

SWP : Steps
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Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Activity 1 Activity 2
Reviewing Organization Direction
& External Environment
Analyzing Internal and
External Labour Forces
“Lets dip deep into strategy, market research and
analytics”…

•  Where is the organization going in the next three to five
years?
•  What are the organisation’s current and future business,
work functions and activities?
•  What are the required workforce composition and
competencies?
•  What are the anticipated changes over the planning
period?
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key questions to explore when reviewing organization direction and
external environment;?

•  What does the current and future labour market look like
(regarding the availability of certain occupations and the
people necessary to fill them)?
•  What is the impact of current or future government
regulations
•  What are the sources of competition for attracting people
(salary, benefit packages, etc)?
•  What other trends may impact the organization (such as
trends towards decentralization, outsourcing or
restructuring)?
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•  What does the current and future labour market look like
(regarding the availability of certain occupations and the
people necessary to fill them)?
•  What is the impact of current or future government
regulations
•  What are the sources of competition for attracting people
(salary, benefit packages, etc)?
•  What other trends may impact the organization (such as
trends towards decentralization, outsourcing or
restructuring)?
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Analyzing internal and External labour forces
Analyzing the internal and external labour
force will enable an organization to identify:
ü  The composition, characteristics, competencies and
supply of current labour for the organization (from
internal and external sources)
ü  The type of jobs and skills available internally and
externally.
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Internal workforce information can be collected
through a range of quantitative and qualitative
methods that include:
•  Competency assessments – surveys of managers
and employees
•  Workload data – line managers complete reporting
templates with instructions and formulas on how to
calculate workload
•  Workforce data – personnel records and human
resource systems.
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Monitoring external labour market changes ensures:
•  Sufﬁcient numbers of replacement staff are available
to cover separation and growth
•  The contingent workforce relied upon by the
organization is maintained at adequate Levels
•  Intelligence is gathered to contribute to the decision
of whether the organization “builds or buys” speciﬁc
workforce skills and numbers required.
“this data can be collected from labor websites,
databases, career fairs etc.”
75

Analyzing Internal labour forces
76
Demographic data Trend data (for a historical picture)
Number of employees, FTE and headcount Resignation/separation/turnover rates
Job classification/occupation Retirement patterns/rates
Salary level Voluntary separation rates
Age distribution Leave patterns (sick leave, long service,
family/parental leave)
Gender breakdown Recruitment and vacancies patterns
Nationality and diversity characteristics Promotion and transfer patterns
(ie. mobility within agency)
Education level/qualifications Skills gaps
Employment status Skills gaps
(eg. ongoing, fixed-term contract)
Competency levels

•  What are the competencies, attributes and composition of
the current workforce?
•  What is the current workload?
•  What are current and projected retirements, turnover,
secondments, etc.?
•  What is the current year labour budget?
•  What current skills are essential to the business?
•  What is the demand for and availability of these skills in
the external labour market?
•  What occupational groups or skills does the organization
currently obtain via contracts or casual employment?
77
key ques*ons to explore when analyzing the internal and external workforce
include: ?

•  What are the key characteristics/skills/profile of employees
on contracts and casuals?
•  What is the labour market like (re: availability of qualified
candidates, ability to recruit these candidates, and
organizational challenges (i.e. internal constraints) in
recruiting competitively?
•  What are the trends in external benchmarking data (re:
rates of pay, skill availability)?
•  What are the trends in external environmental data (ie.
inflation, competition, unemployment)?
78
key ques*ons to explore when analyzing the internal and external workforce
include: ?

SWP : Steps
79
Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Activity 1 Activity 2 Activity 3 Activity 4
Understanding Future
Work Requirements
Identifying Future
Competencies
Developing Forecasting
Models
Developing Forecasting
Assumptions & Scenarios

Understanding Future Work Requirements
Inputs to identifying future work requirements
for the organization include:
•  Organizational business plans and vision
•  Current workforce proﬁle (including
competency levels, composition and
numbers).
80

81
Techniques Description When to Use
Focus Group
Small group facilitated discussion enables
anecdotal evidence to be obtained
Highly specialized fields, to gain
information quickly
Survey
Employee surveys of intentions can help
predict likely outcomes and identify
impending changes
Best conducted on a regular basis
to obtain trends, high reliability
Delphi technique
Draws together subject matter experts and
engages them in assessing likely impacts
and their assessments of future directions
and trends
Specialized area, to obtain senior
input
Force field analysis
Small group brainstorm force field analysis to
identify forces that promote and resist
change
Significant external barriers
present
Scenario planning
Narrative statements of possible futures for
the organization
Lack of clarity and
ambiguity of future

•  What type of work will be done in the future?
•  How will this new work be performed?
•  How does this work differ from current work requirements?
•  What work/job roles/positions will be critical to the
organization in the future?
•  How will jobs and workload change as a result of future
technological advancements, economic, social and
political conditions?
82
key ques*ons to explore when understanding future work requirements
include: ?

•  How will the organization need to be structured to support
future work requirements?
•  How will work flow into each part of the organization?
What will be done with it? What will be the reporting
relationships?
•  What attributes of the current workforce need to change
for the future?
•  What are the future work and organizational business
requirements?
83
key ques*ons to explore when understanding future work requirements
include: ?

Identifying future competencies
Having identified the future work that needs to be
done, we would then need to identify what skills
employees will need to carry out the work;
•  Competencies can be defined organizationally or
on an individual basis
•  The set of competencies that describes the ideal
workforce of the future are then captured within
the Future Workforce Profile
84

•  What new skills are needed for future business and work
requirements?
•  What are the critical core organizational competencies that
will be required to support the organisation’s future vision
and culture?
•  What new knowledge, skills and abilities do specific
positions/job groups/work areas need to perform in the
future?
•  What are the key differences in the current and future
workforce competencies?
85
key ques*ons to explore when iden*fying future competencies include:
?
Identifying future competencies

Developing forecasting models
The decision to use forecasting models within a workforce
planning exercise depends on the level of complexity,
accuracy and scope required.
•  Forecasting Models use mathematical and statistical
techniques to simulate different organizational
scenarios.

•  The models allow the exploration of the relationship
between different human resource issues and how
variations in one component will have an effect on the
workforce under review.
86

87
Forecasting Model Description
Equilibrium Modeling
Looks at actual numbers and assumes that over time no change will occur
within the system. The benefit of this approach is that it provides baseline data
from which changes can be assessed
Network Flows Mapping

Attempts to predict employment outcomes such as retirement,
lateral movement, promotion etc, based upon their links with
other employee characteristics such as salary, skill, age, sex,
etc. These movements are expressed as probabilities and enable a “what if”
type of analysis to be undertaken
Change Forecasting

Attempts to forecast employee flows by looking at past
practices. This information is used to project the future availability of employees
whilst making allowances for potential organization change. The statistical
methods employed are predominantly probability and regression analysis
Optimization Models

Attempt to identify an “ideal” position or set of future goals using
complex statistical techniques such as linear and goal
programming. They rely heavily on the integration of workforce
planning with strategic or corporate planning

Developing forecasting assumptions and scenario building
In order to make forecasting more realistic, a range of
assumptions concerning the future can be developed
and incorporated into different scenarios
•  Depending upon the size and complexity of the
scenario, they can be used to propose possible
intervention strategies such as policy changes or
increases/decreases in stafﬁng levels and
ﬁnances.
88

•  What are the most critical assumptions to use for
developing scenarios? (in terms of the organisation’s
business directions and risks)
•  What are the different potential pictures of what the
organization could look like?
•  Which scenarios should be used? (in terms of realism,
relevance, challenging the status quo and risk
management for the organization)
89
key ques*ons to consider when developing scenarios include:
?
Developing forecasting assumptions and scenario building

SWP : Steps
90
Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Activity 1 Activity 2 Activity 3
Identifying & Analyzing
Gaps (Supply / Demand)
Prioritization of Work Identifying Potential
Directions for Action

Identifying and Analyzing gaps
A short fall (when projected supply is less than forecasted demand)
which indicates a future shortage of needed employees or skills.
•  Effective strategies, such as recruitment, training and
succession planning will need to be developed and
implemented.
A surplus (when projected supply is greater than forecasted demand)
which indicates a future excess in some categories of employees
(occupations or employee skills that will not be needed in the future, or
at least not be needed to the same degree).
•  Retraining, transfers or separation incentives are a few examples of
strategies to address surplus situations.
91

Prioritization of Work
Having identiﬁed the existence and nature of the
gaps or surpluses, they need to be prioritized
according to those that are most critical to the
organization and the delivery of future goals.
•  Separating operational short-term and strategic long-term
issues is helpful in determining priorities.
•  Completing a risk assessment of the gaps enables us to
identify strategic high risk areas which basically means; that
all significant risk factors that could prevent the successful
achievement of the organisation’s objectives and performance
targets are well understood and managed.
92

•  Which are the most critical gaps for the organization, in
terms of achievement of future business requirements?
•  Which gaps are related to operational short-term issues?
•  Which gaps are related to strategic long-term issues?
•  What are the risks associated with each gap?
•  What would happen if the gaps are not addressed? How
likely is it to happen?
•  Which risks are acceptable to the organization and which
ones are unacceptable?
93
key ques*ons to consider when priori*zing the work include:
?
Prioritization of Work

Identifying potential directions for action
The next activity involves the identification of
potential actions to address the prioritized
gaps.
•  Short and long-term actions across HR and organizational
processes need to be considered, and linked to business plans.
•  Understanding the reason for the gap will assist with
identifying potential directions for Action (Root Cause
Analysis)
94

•  Does the agency’s workforce currently have the
anticipated future skills?
•  Is the number of employees with the critical skills
adequate?
•  Are critical skills available in other positions within the
organization?
•  Are there feeder positions for these critical skills?
•  What job functions or skills will no longer be required?
95
key ques*ons to consider when assessing the reason for the gap include:
?
Identifying potential directions for action

SWP : Steps
96
Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Strategy
Formulation
Establishing the Case
for Change

Develop Strategies
The strategies (linked to business plans) and action plans
need to specify what is going to be done and when.
Strategies to address workforce planning issues can fall into one of
six categories:
1.  Improving attraction and recruitment strategies
2.  Improving labour supply
3.  Increasing investment in development
4.  Improving employment agility
5.  Improving workforce governance and capability
6.  Improving participation, retention and culture.
97

•  What are the key things the organization needs to
accomplish and by when?
•  Which are the best strategies for the organisation’s
business needs, values and culture?
•  How can strategies, processes, technology, and
management systems be integrated to respond to
changing requirements?
98
key ques*ons to explore strategy formula*on include:
?
Develop Strategies

•  How can functional areas such as marketing, finance,
operations and human resource management be
integrated to attain organizational aims and objectives?
•  How can the needs of all key stakeholders be addressed
whilst achieving organizational objectives?
•  What resource and budget allocations are required?
•  How can the current mission be met while simultaneously
and proactively planning and preparing for the future?
99
key ques*ons to explore strategy formula*on include:
?
Develop Strategies

Establishing the Case for Change
Establishing the case for change is critical for the success
of any planned strategies and changes.
•  It creates the sense of urgency required to get support and co-
operation from key stakeholders
•  Senior management need to understand the Current situation,
strategic issues and what needs to be done so that they support
and champion workforce planning and change efforts
•  A business case can be developed to support the implementation
of the proposed strategies
100

Establishing the Case for Change
The business case needs to address the following issues:
•  The issue or problem. What needs to be done and why?
•  The risks to the organization if action is not taken
•  An outline of the proposed strategies and actions
•  The options considered and the rationale for choosing the
proposed solution
•  What the proposed strategies/actions will deliver for the
organization, in terms of benefits and return on investment
•  The associated costs and resource implications for
implementing the strategies (in the form of a cost/benefit
analysis)
101

SWP : Steps
10
2
Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Activity
Execute
Strategies

Execution of Strategies
•  Ensure organizational buy-in and support is obtained
•  Clarify roles and responsibilities in implementing strategies and
actions.
•  Develop project plans for the implementation of each workforce
strategy. This also involves establishing budget and resource
requirements, timelines and milestones for key deliverables
and stages;
•  Determine performance measures, success indicators and
reporting systems
•  Develop communication plans to inform all employees of the
strategies to be implemented: what has been done, why and
how it was developed, how and when it will be applied and how
it will affect staff 103

SWP : Steps
104
Workforce
Analysis
Forecast
Needs
Analyze
Gaps
Develop
Strategies
Implement
Strategies
Monitor &
Evaluate
Monitor Evaluate

Monitor & Evaluate
Workforce plans and strategies need to be reviewed at
least annually in order to:
•  Review performance measurement information;
•  Assess what’s working and not…
•  Adjust the plan and strategies as necessary; and
•  Address new workforce and organizational issues that might
occur.
•  Organizations that do not engage in systematic reviews of
their workforce planning efforts, are at risk of not been able to
respond to changes as they occur and of ultimately not
achieving their business goals.
105

# Did the project/organization achieve its objectives?
# Reflect on learning that has occurred. What worked well?
What could be improved?
# Where there any unexpected outcomes?
# Were the actions and strategies completed, and do they
fulfill the goals?
# Did the action plan accomplish what the organization
needed?
# If not, have the organisation’s strategies on which the plan
is based changed?
106
key ques*ons to consider when assessing the eﬀec*veness of workforce
planning include: ?
Monitor & Evaluate

# Have the conditions changed so that the strategies and
actions need to be modified?
# Are the workforce planning assumptions still valid?
# Are the skills of employees being developed quickly
enough to become effective?
# Is there any imbalance between workload, workforce or
competencies?
# Do the new recruits possess needed competencies?
# Has the cost to hire been reduced?
# Has overall organization performance increased?
107
key ques*ons to consider when assessing the eﬀec*veness of workforce
planning include: ?
Monitor & Evaluate

References
109
CANNON, J.A. and MCGEE, R. (2008) Organiza*onal development and change. CIPD toolkit.
London: Chartered Ins*tute of Personnel and Development.

FRANCIS, H., HOLBECHE, L. and REDDINGTON, M. (2012) People and organiza*onal
development: a new agenda for organiza*onal eﬀec*veness. London: Chartered Ins*tute of
Personnel and Development.

STEWART, J. and ROGERS, P. (2012) Developing people and organiza*ons. London: Chartered
Ins*tute of Personnel and Development.

INCOMES DATA SERVICES. (2011) Workforce planning. HR studies. London: IDS.

TAYLOR, S. (2014) Resourcing and talent management. 6th ed. London: Chartered Ins*tute of
Personnel and Development.

CANNON, J.A. and MCGEE, R. (2011) Talent management and succession planning. CIPD
Toolkit. 2nd ed. London: Chartered Ins*tute of Personnel and Development.

Workforce planning

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