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Foreword: Whats the future of workforce planning? From manpower planning to capacity planning why we need workforce planning Paul Turner Implementing workforce planning the role of the line manager Tim Berkley Why workforce planning is a strategic imperative Chris Nutt References
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plans need to focus on results and actions and be subject to constant review. We found when talking to our case study organisations that this was something that was not wholly an HR activity and required good relationships throughout the organisation, between business planners and workforce planners at the strategy level and between HR business partners and line managers at the operational level. In his essay, Tim Berkley draws on his considerable experience as a practitioner to consider how workforce planning can help organisations leverage maximum advantage from their workforce costs and in particular the role that line managers play in translating plans into action. Strategic workforce planning Without a workforce plan (which considers how to get the right people, at the right time, with the right skills) it is impossible to understand how viable it is to execute your chosen business strategy. By its very nature, a workforce plan must therefore be strategic. However, there is a danger that strategies discussed at board level are not realised in practice. What happens then is a focus on process to drive the strategy rather than vice versa. Workforce planners should therefore beware of merely following structured process and should always be alert to and able to influence what is happening in practice. What senior managers need to do is either develop workforce planning skills or work closely with those who have them to develop a range of practices and competencies needed to operate in the heart of the business on strategic developments. In his essay Chris Nutt examines what might be involved. He argues that organisations can develop the mindset that includes both strategic thinking and planning behaviours to achieve a complementary process of strategising and organising that will deliver real-time workforce planning to meet the operational and strategic business requirements.
The views expressed in these essays are the authors own and not those of the CIPD or the organisations they work for. However, they do represent an informed view of these important issues impacting on workforce planning. CIPD viewpoint The CIPD believes that workforce planning is an important activity for HR practitioners and one where they can make a real contribution to the business planning process. While it is apparent that as yet there are no right and wrong answers to planning, this does not mean that we should not strive to establish effective techniques in terms of accessing the best-quality information to inform planning and decision-making about the demand for future resources. We hope you will find these essays a useful supplement to the practical guide and would welcome any views or comments on these essays or any other aspect of the subject. If you would like to comment on the issues raised in any of these essays, please contact Angela Baron or Rebecca Clake on research@cipd.co.uk
From manpower planning to capacity planning why we need workforce planning Paul Turner
Introduction Nassim Nicholas Talebs Black Swan hypothesis argued that nobody knows whats going on, and drew our attention to the danger in believing that the world in which we live is more understandable, more explainable, and therefore more predictable than it actually is (Taleb 2007). Wed be hard pushed to disagree with these sentiments in the light of the 2008 global economic meltdown. However, they do not make the task of the business planner and hence the workforce planner any easier. A business plan brings together a variety of key variables, including assumptions about the likely size of a market for products or services, the strategic choices that the organisation can make to compete or operate in this market and the resources needed to implement those choices. It may also include some form of prediction about the future, about the kind of products that will be in demand. For example, Siemens (UK) has identified wind power technology as an attractive area of opportunity; it has highlighted which of its business portfolio is best equipped to take advantage of the market, and is in the process of allocating resource to position the company strongly in this market (CIPD 2010). Because of the hazards of predicting the future, most plans include elements of risk management or list the assumptions on which the forecasts have been predicated. An economic rider can be added to the plan, sometimes stated as ceteris paribus all things being equal, that is, the plan will work if all of the assumptions on which it was predicated turn out to be accurate. Then doubts began to appear about the effectiveness But what if things turned out to be dramatically different? A key lesson from the economic upheaval of 2008 is that the organisation must be in good enough shape to respond to a dynamic and unpredictable set of circumstances. On that assumption, the question is raised as to what the contemporary business plan should look like to meet such stringent tests. And since of such processes. Flawed economic forecasts in the 1970s, which had predicted economic growth and low inflation when in fact there was little growth and high inflation (known as stagflation), brought the whole subject of planning and forecasting into question. Things were made worse by the torrid round of layoffs because of industrial restructuring in the 1980s, The rise and fall and rise again of workforce planning The foundations for modern workforce planning in the UK were laid after the British Government drew up its first Manpower Budget in 1942 to ensure there was enough labour in those industries supplying the war effort. The exercise created a shock to the system when a shortfall of 1 million workers was identified because industrial demand far outstripped supply (Taylor 1965). As a result of this experience there was a change of thinking and a belief that, in future, the recruitment, retention and training of workers should not be left to chance. Instead it should be a systematic, deliberate process. The 1960s were the zenith of manpower planning. Over the years, this aspect of an organisations function has been known as manpower planning, human resource planning and latterly workforce planning. Although the level of importance attached to the subject on the part of HR professionals has fluctuated, a recent convergence of powerful forces caused by the most unsettled economic environment for a generation has created a renewed focus on workforce planning. This essay will outline some of the reasons for this revival and the context of its overall evolution. the success of an organisation depends on its ability to get the right people in the right place at the right time, how should an organisation plan to achieve its people objectives?
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Reflections on workforce planning 5
where the need to plan was a lower priority than fixing the short-term imbalance in Britains commercial and manufacturing infrastructure. The failure to get economic forecasts right and the immediacy of restructuring led to a view that longer-term labour forecasting was a secondary issue. If skilled workers were needed, then there were plenty on the market, so why bother to invest in long-term planning. And anyway, the rigidity implied by the manpower planning approach of the 1960s and 1970s was not seen to be fit for purpose. As a result of this change in attitude, the effort put into manpower planning was reduced, exemplified by the number of employers using elaborate statistical regression models, which fell considerably to 30% in 1978 and to only 9% in 1984 (Capelli 2009). Although a 1988 survey of personnel professionals showed some remnants of the previous era of manpower plans (Hendry 1995), the golden age of manpower planning had passed. In its place came a much more devolved or even fragmented approach. By 1993, although in the private sector a number of major initiatives have been successfully launched in such areas as training and development and competitive restructuring, other areas of manpower planning find only limited support, and the public sector lags behind the rest of the field (Cowling and Walters 1993). In 2003, only a minority of IPMA-HR members responding to an SHRM survey had a workforce planning process (CIPD 2010). While the tools and techniques for workforce planning have always been available John Bramhams 1975 Manpower Planning, and the CIPDs later publication, HR Forecasting and Planning (Turner 2002), were core CIPD textbooks for many years the application of complex macro-level workforce plans using scientific techniques based on operational research and statistics became the exception rather than the rule. The CIPDs 2010 Resourcing and Talent Planning survey found that some, but not a majority, of organisations undertook demand supply forecasting or gap analysis (CIPD 2010), but this was not as much of a mainstream activity as it had been in earlier decades. There had been a change in emphasis from long-term strategic workforce planning to capacity planning with a shorter-term focus. However, the topic was clearly back on the agenda.
The worst economic crisis for a generation in 2008 forced organisations to rethink their demand for labour. For some, it was the end of the war for talent. Turnover was low as people stayed in their jobs rather than risk moving to another organisation (Robinson 2010) and a new set of challenges faced HR professionals mainly concerning employee engagement and organisational restructuring. In spite of this downsizing, restructuring and crisis people management, there was an apparent increase in interest in workforce planning from a wide swathe of organisations. An INFOHRM survey in 2009 showed that many organisations were once again putting in place workforce plans (CIPD 2010). This begs the question of why planning should come back into vogue in such a period of economic uncertainty. The revival of workforce planning a convergence of forces As companies such as McGraw-Hill, National Grid and Starbucks emphasised the importance of workforce analytics and planning (PR Newswire 2010), and Hewlett Packard, IBM Global Business Services, Qantas and Boeing signed up to workforce planning as a vital process of human capital management, it was clear that something dynamic was afoot in 2010. This perception was not confined to the private sector, since the Royal Navy confirmed the benefits of using strategic workforce planning to satisfy the level of demand for personnel while avoiding the over-supply of staff which government budgets would not pay for (Stevens 2010); and at the same time, workforce planning featured strongly in debates within the NHS (Dean 2010). By June 2010, workforce planning was being described as a force for good (Syedain 2010), as the eyes of the HR profession turned towards it as an important process in dealing with the postrecession environment. No single issue can account for the renewed interest in workforce planning. In fact the revival can be attributed to a convergence of forces which had created a new impetus for organisations to develop workforce plans. In response to these external forces, workforce planning is both strategic and operational and based on:
organisation to deal with both expected and unexpected events: The challenge of trying to get alignment of the business strategy, financial performance and people requirements, always an issue, has been accentuated by recession, where a forecast recovery in one month could be superceded by a recessionary double dip in the next. It should be no surprise to find that the first priority created by the dynamic environment was to build a responsiveness that would allow an organisation to deal with competitive conditions whatever they were. Mercers Human Capital Planning 2010 survey showed that 69% of employers believed that the uncertain economic environment was a critical workforce planning concern (Hain-Cole 2009) and the need to have an organisation that could deal with a wide range of scenarios was a desirable objective. How to do this was, of course, the challenge. Organisations have gone back to basics and are trying to get better workforce information and analytics to identify what is the optimal shape which would include a capacity for change but is not cost-prohibitive and does not dilute core competence. Based on the experience after 2008, this shape should allow for linear progression against business objectives based on relatively accurate forecasts of market conditions but, simultaneously, create an organisation that was flexible, agile and adaptable enough to cope with discontinuity, crisis or unexpected opportunity. The workforce plan can facilitate the development of this kind of thinking. Furthermore, the workforce plan addresses the issue of short-term resourcing as well as longer-term development. The new workforce plan has gone beyond the rigid complexity of the old and the key to its success was identified as accurate HR information (Leavitt et al 2010). Getting the right balance between the short-term shape of the organisation and that of the long term will be dependent on this information. At a strategic level this means a workforce plan that addresses organisation design and development, talent management and a reward structure that is relevant and flexible. At an operational level, the workforce plan will form the basis of capacity-building for delivering short-term organisational objectives.
competitiveness: But the answer to the organisational shape is not a binary one. For many, the need to control costs goes hand in hand with the need to increase competitiveness, which can create strategic choices that are seemingly contradictory, for example redundancy and recruitment taking place simultaneously. It has become increasingly recognised that, by providing an overview of workforce patterns, trends and requirements, the workforce plan can inform the choices that the organisation needs to make. In this respect, the workforce plan is analogous to the functions of the balance sheet, profit and loss account and sales plan combined. On the one hand the workforce plan provides a snapshot of the organisations current position, its human assets and where they are deployed. On the other it shows the dynamics between labour costs and income, while it then plots these against the future performance requirements of the organisation. By using this information, workforce planning allows companies to make selective, strategic decisions about where to invest and where to trim and whether to buy, rent, build or deploy talent to meet future needs (PR Newswire 2009).
The need to upskill organisations: The third
powerful force for change concerns the need to build capacity for the new environment created by economic uncertainty. This is as much a qualitative change as quantitative. Recognition of the need for corporate agility as organisations ensure they are able to cope with unpredictable environmental conditions brings with it a process of upskilling. The preparation of the workforce plan will allow an organisation to identify its people strengths and areas where it may need to develop. The new workforce planning approach, though, treats this not as a static exercise in skills-building, but as a dynamic perspective on multi-skills building and organisational development incorporating contingencies for change. In essence, the workforce plan builds in corporate agility.
The growing influence of the HR function:
Finally, as people issues are at last recognised as strategic issues, the importance of the workforce plan is accentuated. The CIPDs Shaping the Future (2010) research has highlighted an HR profession that has both strategic and operational objectives
with a view to building sustained competitive advantage and the workforce plan informs these critical roles. Strategic workforce planning provides a vital link between business strategy and workforce strategy (PR Newswire 2009). But this has to go beyond fine words and good intentions and the workforce plan can be the platform for informationbased decision-making about people. How could it be otherwise? In the absence of a workforce plan, how can an organisation make decisions about its people? And the workforce plan isnt just about people data headcount, labour turnover, and so on. It is about people information; what are the implications, derived from the analytics of the workforce plan, for business strategy in the short and long term? It is this dialogue that differentiates the new workforce planning approach from that of some of its predecessors. The workforce plan isnt an interesting database. Its a strategic tool that can be used to differentiate the organisation, lead to greater efficiency or utilisation of key resource, and ultimately provide the basis for competitive advantage. The convergence of these forces has precipitated a recognition that workforce planning can be a critical factor in the success of an organisation in the post-recession environment. In particular there is the need to ensure that the organisation has built both the qualitative capacity and quantitative flexibility to cope with opportunities or threats that arise because of the vagaries of the uncertain environment. In simple terms the workforce plan can be the glue that joins business strategy with the objective of getting the right people in the right place at the right time. To do so, however, will require some modifications as to what has gone on before. The new workforce plan The new workforce planning approach will be different from its predecessors. It will not be a rigid snapshot, but a working human resource management tool with substance to allow information-based decision-making. The key to this will be to ensure that the workforce plan has the following characteristics:
It will be integrated with business strategy and
objective will be an alignment to the longer-term, sustainable aims of the organisation, but with a built-in flexibility to allow for change. The planning process will be owned by HR professionals, but the workforce plan itself will be a tool used by the organisation at all levels.
It will be used in short-term resourcing as well
as longer-term planning: To achieve this, there will be a natural progression from the achievement of tactical objectives to strategic ones and therefore the workforce plan will be used as a resourcing tool over both the short and longer term. New workforce planning will facilitate successful management, by identifying the effects of policies and business plans on the workforce and the optimal paths to realise the plan leading to the reallocation of resources and the best human infrastructure (Mouza 2010). The joining up of short-term and longer-term elements will require a level of management that was not necessary when the plans were snapshots fixed in time. The dialogue between HR business partners and their management counterparts will be essential if this process is to work effectively.
It will incorporate flexibility: The third element
that of flexibility is the hardest to achieve. On the one hand, the workforce plan has to have realistic longer-term targets, which will require decisions about infrastructure if it is to deliver. But on the other it has to have an in-built flexibility that will enable the organisation to respond to fluctuations in demand (Hertz et al 2010). Flexibility will be as much about qualitative planning as quantitative. Conclusion After a period when it was considered to be an interesting optional contribution to an organisations strategic planning process, workforce planning is now increasingly recognised as essential to business success. The post-recessionary period has seen organisations deciding on the best shape in which to compete in a period of unpredictability. Key to this is the development of a new approach to workforce planning that is dynamic, iterative and related to the achievement of shorter-term capacity planning as well as longer-term competitive advantage. The role of the HR professional as a strategic business partner as well as an operational deliverer of good people practice is critical to the success of this approach.
planning: The first point is that the new workforce plan will not be an appendix attached to the overall business plan but something that is a critical part of the business strategy dialogue and process. Its key
Implementing workforce planning the role of the line manager Tim Berkley
Introduction In the early twenty-first century, companies have needed to drive maximum return from their employee costs. Many private sector companies look to find competitive advantage in rapidly changing markets and public sector organisations need to demonstrate strong value for money when competing for public funds. The CIPD has found that, increasingly, organisations have looked beyond financial management as a tool to plan the business. Organisational advantage can be achieved by deploying the current workforce more creatively, maximising productivity, as well as by ensuring that the organisations workforce is better placed than those of its competitors to take advantage of new business/market opportunities or threats. It is no longer enough to have strong recruitment, talent management and engagement strategies: managers have begun to look for ways to drive greater value from the whole of their workforce. Smart companies have done this by building a quality workforce plan as an essential part of the business planning process. The workforce plan is therefore an integrated part of the business planning process. Though informed by data from the HR department and others, it should no longer be a document owned or implemented by HR. If the business plan ultimately informs the setting of financial and business performance objectives for line managers, by definition the workforce plan is a tool by which the manager can achieve those objectives. The workforce plan may be co-ordinated by HR and may inform the HR experts on how to help build new processes or tools in order to achieve the business strategy, but it is line managers who need to deliver it. This essay outlines the role of line management in the planning process and argues that they are the owners of the plan, even if more senior leadership drives the overall direction and goals. Elements of the workforce plan The workforce plan is about optimising the return on investment of the workforce, considering how they are best deployed (organisation design), the skills that they need and how the organisation will develop them, the numbers that will be needed in the different skills at the different levels, the geographical spread and the strategy for sourcing any gaps or resolving any oversupply. By their nature and content, this close connection to the financial planning process means that the workforce plan is constructed by the same leaders in the organisation that are tasked with finalising the financial plan. The two are inextricably linked and so it is difficult to divorce them. While the delivery of the plan is done by managers at any level of the organisation, the devising of the workforce plan needs to be carried out alongside the more financial aspects. According to the study, workforce planning flows from the organisational strategy and is a way to link people management into the operational business processes. Organisations have grown used to developing talent development policies, recruitment strategies, outsourcing activities and training plans. Workforce planning becomes the foundation that underlies these initiatives, bringing them together to align them and focus them on supporting the long-term direction of the business. A core process of human resource management that is shaped by the organisational strategy and ensures the right number of people with the right skills, in the right place at the right time to deliver short- and long-term organisational objectives. (CIPD 2010, p4) Definitions In its research, the CIPD has defined workforce planning as:
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Reflections on workforce planning 9
It is evident that the start point of this analysis is the business strategy. However, it is also important to remember that this relationship is two-way the workforce planning must also inform the business strategy. For example, a severe shortage of skills may mean that a company has to take longer to break into a new area than the financial advantage might suggest. There might be recognised advantage from concentrating on core competencies and outsourcing other activities. Companies define themselves by what they are good at and then try to use these skills in new areas. Other companies find that they need to buy skills through strategic or operational acquisition. What is the role of the line manager? In another essay, the role of strategic leadership is developed further. In this essay we look specifically at the input from the line manager.
organisation and overall direction, as well as the financial plan. With the leadership team as the author of the plan it has the credibility and authority required to ensure that it is delivered and that actions are themselves supported. In constructing the plan, the senior leadership lead with the context and support the discussion on the implications of the content in terms of skills and productivity improvements. This topdown process should however be heavily supported by line management input. Leaders need the local knowledge of line management to ensure that the plan remains realistic. This input may not be supplied in a formal planning process but is important to capture. Organisations may find that they already have access to much of the data through existing mechanisms and processes. Examples are:
Table 1 shows the owners of the various inputs that help to formulate the plan conclusions. The macro plan itself must necessarily be led by senior leadership of the organisation or part of the organisation to which the plan refers. In this way the plan retains its integration with the goals of the
Quarterly financial reviews between local
and strategic leaders can provide intelligence on competitor activity particularly by asking how competitors are organised, how successfully they are sourcing vacancies, what they are paying, whether they are also trying to hire the same skills.
Description What the unit needs to achieve Product and business strategy, customer needs from workforce
How are competitors organised Local management/employees and are there lessons to be learned/ threats to the organisation? What skills are needed to achieve the strategy? Can this be done differently? Quality and availability Training time, cost and productivity, deployment Strategic leaders/local management Local management/HR Local management/HR
Skills needed
Skills available Opportunity from existing workforce Existing workforce metrics Labour supply issues
Productivity, turnover, headcount, HR return on investment Demographics, labour expectations, local activity in the labour market Reward management HR
Productivity
Strategic leaders/HR
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consolidate the data from the sources above and to provide insightful analysis on the conclusions. They can uniquely do this in the organisation because they own many of the sources and are routinely connected to conversations at all levels of the business from which to learn the context and issues. Line manager as a recipient of the workforce plan While the plan is owned by strategic leadership with input from other sources, the delivery of the plan is securely the role of the line manager. The plan helps formulate strategies in the following areas:
Effective deployment and organisation design:
the availability of talent internally that is capable of supporting the organisation strategy and workforce plan. This data provides an indication of training needs that need to be identified and succession planning opportunities.
Financial reporting systems might be able to
analyse performance data such as commission plan performance, which helps to identify productivity.
HR information systems provide headcount
metrics and turnover data to highlight potential issues in achieving target headcount numbers in each of the skill areas identified.
Employee survey data can give useful indications
from employees of engagement scores and how the organisation might be able to improve productivity. All these different sources have their origins in data provided at the local level. By linking them to the workforce planning activity, the processes are given new purpose. Line managers can see the information being used in an intelligent and productive way and through that can more easily be persuaded that the plan itself is their own derived from data that they have supplied but reflected back in the context of what the organisation needs them to achieve. HR input into the plan In the work on Next Generation HR undertaken by the CIPD, it is argued that HR practitioners need to aspire to develop deep organisational insight. This is defined as: The juxtaposition of a deep understanding of what will help make your organisation successful or stop it from being so in the market within which it operates at this stage in its evolution, together with a deep appreciation of what goes on around here and what really makes things happen here (given people, politics and culture). The former derives from understanding the key drivers of the business, the wider market and the context in which it sits. The latter comes from the intelligence generated both systematically through data-gathering and analysis, as well as from the discrete activities and interactions HR engages in across the organisation. (CIPD Next Generation HR 2010) The workforce plan is an important vehicle and outcome for this insight. HR have the opportunity to
using the workforce plan, managers can optimise the design of their team ensuring that there is the right span of control for the future needs; identifying any opportunities from oversupply in one area that can be used to plug skills gaps in another; driving efficiencies and productivity improvements wherever it is needed; outsourcing opportunities or relocating of teams.
Right-sizing the team: planning for numbers of
recruitment/severance during the period of the plan. With the plan, the manager can become more proactive in defining the HR strategy for the team, intelligently using vacancies to advance the long-term strategy. No longer does the manager replace like for like, firing when the profile doesnt fit and hiring when a new profile is needed. With a workforce plan, the manager is encouraged to manage reductions more intelligently to anticipate how to deploy the resources available and to creatively develop new ideas that can be fed into the plan in the next cycle
Effective sourcing externally: having a
proactive approach to candidate sourcing enables organisations to optimise all avenues for the supply of future skill needs. Managers can seek out networking opportunities, for example, that identify good talent that the manager now knows may be needed in the future. Organisations can develop much more effective strategic recruitment, such as graduate recruitment, apprentices or recruitment campaigns. Additionally, thinking ahead about where that supply might come from or how it can be developed internally helps to anticipate issues that exist in that labour market through supply elasticity or demographic changes.
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future needs of the organisation. This purposeful approach helps ensure that the organisation is ready for change when it comes and also helps employees understand the future direction of the organisation and their role in it a true partnership of engagement.
Community involvement: having a deep
the workforce plan ensures a much better-quality dialogue about promoting flexibility in the team, whether it is when responding to requests for more flexible working patterns or when proactively finding ways to build more flexible productivity in the way that the team can respond to changes in the organisations needs. By proactively managing succession planning in the context of the workforce plan, the dialogue becomes much less about resourcing vacancies and much more about meeting demands of the future workload.
Talent and skills development: individual
understanding of future needs helps managers to deploy their community involvement most effectively. Organisational involvement in the community is divided between philanthropic involvement and employer branding activities. The latter can be directed to activities that are consistent with the future needs of the organisation, perhaps a more appropriate educational institution, or an organisation that gives visibility to the needs of a particular population group, and so on. Community involvement also provides an opportunity for good labour market intelligence on how the company is perceived and how that changes over time.
development is too often driven from an annual reactive process provoked by performance appraisal meetings or the publication of the organisations annual training course calendar. The workforce plan enables the manager, and the HR business partner, to plan training and development opportunities within the team in the context of the
Figure 1: Sales force model
90 90 90
Target STRUCTURE Number of product 1 sales reps Number of product 2 sales reps Number of technicians Number of product 3 sales reps Number of product 3 technicians Number of other reps Number of support staff 8 25 8 7 3 5 5 COVERAGE % of product 1 customers % of product 2 customers % of product 3 customers 80 85 85
Vision QUANTITATIVE Close 80% of the gap between company and nearest competitor on product x QUALITATIVE Outperform competitor in terms of customer perception
RECRUITMENT NEEDS
Number of product 1 sales reps Number of product 2 sales reps Number of technicians Number of product 3 sales reps Number of product 3 technicians Number of other reps Number of support staff Current 5 15 5 3 1 0 2 Attrition 1 2 1 0 0 0 0 Target 8 25 8 7 3 5 5 Recruitment needs 4 12 4 4 2 5 3 TARGETED PROFILES 2 to 4 years exper. in same industry Senior, 5+ years exp., in x industry Senior, 7+ years of experience in product area Senior, 7+ years of experience in product area Senior, 7+ years of experience in product area 2 to 4 years exp., in similar industry Senior, 5+ years exp., in function
Source: Boston Scientific internal document (2009). All figures fictional. Source: Boston Scientific internal document for Sales Managers in Europe, 2009 (all figures fictional)
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Ensuring success of the workforce plan Line managers have a heavy stake in securing the success of the workforce plan. Through this vehicle they can have greater clarity over the future direction of the organisation for their team, they have a vehicle for proposing more creative approaches for managing their organisational needs, and they have an opportunity to create dialogue with their own managers on their more micro needs that can then inform their own input upward. To ensure a sustainable process, managers should be encouraged to take the following actions:
Dialogue with stakeholders: discuss the plan
Conclusion The workforce plan has a number of stakeholders who all need to work together to provide input to and support the delivery of the workforce plan. Line managers work alongside HR, finance, strategic leadership, external suppliers, training professionals and employees themselves to ensure execution. Line managers have an effective role to perform to feed information into the plan derived from their direct and local knowledge of the product or service market, their direct contact with employees, their experience with external candidates and suppliers and their own experience with managing teams. This insight is placed into the context of other information, which is then returned to the line manager, who has the ultimate role in ensuring that the plan is delivered and that the cycle is in turn sustainable for the next process. Line managers are also the stakeholders that ensure that the plan is delivered. Workforce plans are not new: the elements of the process have been actively used in most organisations in the form of talent management, succession planning, recruitment strategies and objective-setting. However, revitalising this activity to bring all these elements together to inform a focused, unified strategy gives the local line manager key competitive advantage in attracting, retaining and developing the team as a key success factor in ultimately driving shareholder value.
with local managers and team members wherever possible. This helps them to understand the context of their management decisions and encourages them to think themselves about how they can encourage more innovation in the way that work is deployed and managed.
Seek out partners for delivery of the actions:
managers should actively partner with their HR support, finance professionals, training experts, community organisations, external suppliers and other colleagues to seek to share a stake in the work to achieve the objectives.
Integrate the plan: what gets measured gets
done. The plan needs to be consistent with annual performance objectives and connected to the financial objectives of the team.
Review and feedback: organisations change
quickly and need to be flexible. New strategies are launched, new threats and opportunities emerge. At least quarterly in most companies, managers should purposefully revisit the assumptions that they are working to. The strategic plan itself may not have changed, but the action planning may well need refreshing to take account of unforeseen issues. These changes can be used to underpin feedback upwards as leaders in turn conduct their own reviews up through the organisation. Done well, this process feeds the development of the new plan and a virtuous cycle begins to develop. Tim Berkley is an International HR Director for Boston Scientific. All opinions expressed in this essay are his own and do not necessarily reflect the views of Boston Scientific Corporation.
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14 Reflections on workforce planning
around the corner, we cannot know who or what combination of people is best placed to have relevant insights. So, accomplishing effective self-organising depends on creating a culture where everyone including those previously undervalued, marginalised groups with suppressed voices has a mindset to contribute openly within trusting relationships. That is the way to turn insights into realised strategy. Strategy is realised through (self) organising rather than topdown command and control. Strategy as organising It is commonplace to think of strategy as something that comes into existence and is followed by the organising of work. And yet when strategy is not something we have, but what we do, it follows that the activity and learning inherent in organising influences the way we think about and do strategy. Innovating the way we organise (for example, as in the way we organise the planning process) introduces new thinking to strategising. It is therefore better to think of strategising and organising simultaneously.
planning it is particularly important to explicitly differentiate controlling strategies from their empowering counterparts but not choose one over the other. Both are required to open up the possibilities and flexibilities in our strategising.
Minding: this is personally striving to re-interpret
these features of strategy in a way that sees them not as either/or choices but as complementary. This helps us come to understand the complexities of organisational change in action. It is never simple.
Coalising: by arming ourselves with a both/and
mindset we are able to use our insights to help key parties to mutually reconceive their specialist (divisional) strategies as complementary (and integrative) to those of others functions. Coalising contrasting ideas empowers people to act since it refocuses the narrative across the organisation as a whole. These three competencies can be practised to facilitate strategising/organising. In other words, practising planning in this way actually enacts workforce strategy. It is proactive and action oriented. Before expanding on the notion of extraordinary workforce planning and these particular competencies, let us consider some emerging trends in strategic planning that demand a different way of doing thinking about strategy. Emerging trends in strategic planning Problems exist with traditional strategic planning and the way forward seems to be to use an organic process, with intuitive insight, a celebration of emergent strategies and, most importantly, a focus on implementation. This can be nurtured through cultural change: working on individual attitudes leading to a shift in organisational behaviour that enables the complexities to be handled through informal selforganising groups. Since we cannot know what lies
As Whittington et al (2006) point out, the pace of change has caused strategy planning to shift its emphasis from analysis and forecasting to more of a concern with communication, co-ordination and control, requiring strategy and organisation to be interlinked. This is manifested in various forms of organisational initiatives, strategy workshops and strategic project management. These activities have become valued as hands-on, practical crafting skills that get strategy done. In this way, practitioners stimulate strategy by injecting their crafts directly into the process. This becomes a constant activity since the conditions faced by most organisations means their thinking has to be done in a context of unending change. As a consequence strategies and organisational forms become transitory and strategising and organising are constant obsessions of senior management. The dynamic nature of business management renders the
See, for example, HAMEL, G. and PRAHALAD, C.K. (1994) Competing for the future. Boston: Harvard Business School Press; CAMPBELL, A. and ALEXANDER, M. (1997) Whats wrong with strategy? Harvard Business Review, NovDec; WARREN, K. (2000) The softer side of strategy dynamics. Business Strategy Review. Vol 11, No 1. pp4558; TOWELLS, S. (2003) From planning to strategic intent. Strategy. Issue 1. pp2024.
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difference between strategising and organising meaningless they have become the same process undertaken at the same time. Multiple perspectives Pluralism and the consequent complexity of the organising processes are becoming the norm for organisations (Jarzabkowski and Fenton 2006). Complexity and tensions arise when, for example, professional and managerial perspectives differ or when attempts are made to operate single systems across differing business and market cultures or when there are multiple demands arising from external stakeholders such as regulators, quality standards and investors. This produces multiple strategic goals and objectives. An approach that seeks coherence is therefore likely to be frustrated. Instead, we need to take a more dynamic and pluralistic view of the organisation and its activities. The paradox of strategy Smith et al (2010) argue that in a fast-paced, changing environment, success depends on managing several, often contradictory agendas and strategies simultaneously. There are many other examples of what are sometimes described as paradoxical (contrasting yet interrelated) strategies, such as low-cost/high-quality strategies, stability/agility business models, learning/ performance organisations. A critical paradox is the contrasting drivers of exploiting existing business advantages (refined through mechanistic, centralised, hierarchical controls) versus exploring new ones (futurelooking in organic, decentralised, flat structures). The parallel management of such contradictory business models requires a both/and mindset. Since business modelling involves delivering strategy through the organisational architecture of people, competencies, processes, culture and measurement systems, workforce planners must also have a both/and mindset.
Extraordinary workforce planning My own recent research (Nutt, forthcoming 2010) convinced me that conventional planning processes are necessary but insufficient to achieve transformational change because they do not deal sufficiently with the paradoxes of control versus empowerment. These paradoxes are explained in more detail below. Doing workforce planning proactively In an increasingly complicated world, the ability to handle complex business strategies has become a source of competitive advantage. Senior team processes that can build on internal contradictions and tensions are an important differentiator of organisational excellence. Complex business models that can host contradictions can help to develop dynamic, flexible and adaptive capabilities to succeed for the short as well as the longer term. And yet it is still quite common to find the classic defensive response of avoiding contradictions by choosing only one agenda. Overcoming this is challenging, which may be why some corporations keep a clear distinction between contradictory business models. This keeps things simple but there is a need for cognitive complexity the ability to seek integration across seemingly contradictory tensions as well as behavioural complexity the ability to engage multiple leadership behaviours that may seem in conflict with one another. During my research I came to realise that although it is difficult in theory, I and other managers had had to deal with these complexities in practice. I believe that complementing and minding enabled me to think and behave complexly and thus deal with the paradox. These terms are explained below.
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Focus on structured change programmes Rational analysis and formulae Calculate, plan and deliver Limited, measured resources Time available is limited and reducing Tight controls and precision Specialist discourses Competence through division of labour The science of management
Focus on social networks Savvy understanding Sensing and trusting to intuition Emerging involvement and contribution Creating time from discretionary attention Loose steering and ambiguity Emerging common language Learning through collective sense-making A craft of interpersonal relations
Complementing A proactive approach to organising must be empowering yet controlled, that is, paradoxical. Table 2 shows an example of an analysis of controlling versus empowering strategies. Each item is far from new, but by making the underlying differences of approach explicit, we can turn paradoxical (either/or) strategies into complementary (both/and) strategies. The point is that the workforce planner needs to emerge from a single lens view of the organisation and use multiple interpretations of what organisation strategy means. This enables and empowers the planner to strategise/organise simultaneously in concept and to then contribute through action in practice. The flexible mindset that enables this is minding. Minding Thinking complexly by minding is the capacity to use both scientific and narrative forms of management thinking. Hence, minding links to complementing as a simultaneous multi-interpretation of what is going on. This means deliberately seeking several paradoxical explanations rather than merely the obvious, conventional, simple one. Martin (2007) talks of integrative thinking, which is the disposition and capacity to hold two diametrically opposing ideas in the mind and to produce a synthesis that is superior to either idea, without trade-offs. The tacit abilities needed for this include experience and salience the ability to detect the features that are relevant and important. He refers to embracing the
mess taking a broader view of what is salient. In other words, this is understanding at a deeper level by welcoming complexity to seek the best answers. And his guidance is to avoid breaking problems down into independent pieces to work on each piece separately. Keep the entire problem (and consequences for all) in the mind the whole time minding. But lets not keep this to ourselves. We need to bring others to open their minds and then converge on mutual understandings of the way forward. I call this coalising. Coalising Forming a coalition and coalising are not at all the same thing. Change is not about understanding new things or having new ideas; its about seeing old things with new eyes from different perspectives. Change is not about reengineering, reinventing, re-capitalising. Its about re-conceiving! When you re-conceive something a thought, a situation, a corporation, a product you create a whole new order (Dee Hock, founder and CEO, VISA International in Muoio 1999). If we accept this view of change, as informed people engage in conversations, they reconceive (reinterpret) the meaning of what is happening. They are thus engaging in the process of bringing multiple thoughts together (from multi-disciplined minds) to one conversation, and coalising those contributions by mutually reconceiving interdisciplined notions of what the organisation is and is becoming.
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This depends on allowing interactions established freely so that new identities emerge from the selforganisation process. People in conversations about the business come to identify themselves with the issues it faces, the challenge, possible solutions and hence its agenda for change. They do not form a coalition as a structure, but they coalise in the sense that there is an emerging coalescence of views and expectations.
keep your silent inner conversations consistent with your own values
are trying to earn a reputation for fair dealing can associate ideas from differing sources, to link
A central aim of leadership is to detect the themes that are emerging from the ongoing conversations and to articulate these in a way that finds resonance with those being led. (Stacey 1996) Overview This process of workforce planning taking an organising approach is represented in the simplified, linear progression shown in Figure 2.
Figure 2: Knowledge and connectivity in the real context
building
building support in an aggressive, political
Complementing Minding Coalising Organising Complementing encourages minding since it contrasts, but does not eliminate, ordinary scientific management which we might label as administration with the more intuitive art and craft of relating. Minding enables coalising since it celebrates (and is therefore unthreatening to) both conventional project management processes and human relationships.
environment by imitating the aggression and overt political power-play of others and critically wary of:
one-sided ideologies of a profession or school of
compelling it is
the wisdom of the moment or the latest
Hence, complementing and minding help to develop a behavioural capacity to facilitate a coalising process throughout the organisation. This requires a certain kind of mindset, which I describe below based on practical experience.
organising Four aspects of minding impact on the ability to coalise and hence to organise:
1 A respectful mind responds sympathetically and
constructively to differences among individuals and groups, seeking to understand and work with those who are different, extending beyond mere tolerance and political correctness and attending to the qualities of specific individuals (rather than categories).
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Conclusions This essay will, I hope, provoke thought and encourage workforce planning practitioners to think outside the box normally associated with planning. Without for one moment wishing to discourage further development of diagnostic, measurement, control and monitoring techniques and the associated search for challenging benchmarks and organisational performance ceilings I would encourage everyone involved to reconceive planning as a proactive implementing activity and enable managers to understand how it relates to other strategic activities rather than focusing on the operational elements. The emerging ways of doing business strategy require skilled interventions, and people involved in shaping the future workforce can work from within rather than from outside if they focus on relationship-building and personal development as well as following expert process.
roles at work and outside as a citizen, and acts consistently with those conceptualisations.
3 A both differentiating and categorising mind
notes the power of groups but is also sensitive to differences within and diagonally across groups. This helps with politics.
4 A sensitising mind continuously interprets the
context, problems and remedies it contains. Such minding sees the significance of seemingly minor issues and responds vigorously. Front-line operations are given attention and notice taken of staff and customer issues. The importance of relationships and informal networks is recognised. Big picture and detail are both given attention. Coalising is a continual intervening to:
give voice to marginalised groups, equalise power
relationships and facilitate mutual understanding across technical and social boundaries
facilitate the public conversations required to
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References
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20 Reflections on workforce planning
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