STRATEGIC WORKFORCE PLANNING

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 Strategic Workforce Planning

• First component of HRM strategy

• All other functional HR activities are derived from
& flow out of HRP process
• Basis in considerations of future HR requirements
in light of present HR capabilities & capacities
• Proactive in anticipating & preparing flexible
responses to changing HR requirements
• Both internal & external focus
 Strategic Workforce Planning

• Goes beyond simple hiring & firing

• Involves planning for deployment of human
capital in line with organization &/or business unit
strategy
• May involve:
– Reassignment
– Training & development
– Outsourcing
– Using temporary help or outside contractors
• Needs as much flexibility as possible
 Key Objectives

• Prevent overstaffing & understaffing

• Ensure organization has right employees
with right skills in right places at right times
• Ensure organization is responsive to
changes in environment
• Provide direction & coherence to all HR
activities & systems
• Unite perspectives of line & staff managers
 Types of Planning

• Aggregate Planning
– Anticipating needs for groups of employees in
specific, usually lower level jobs & general skills
employees will need to ensure sustained high
performance
• Succession Planning
– Focuses on ensuring key critical management
positions in organization remain filled with
individuals who provide best fit
 Aggregate Planning

• Forecasting demand
– Considers firm’s strategic plan’s effects on increases or
decreases in demand for products or services
– Assumptions on which forecast is predicated should be
written down & revisited when conditions change
– Unit forecasting (bottom-up planning) involves “point of
contact” estimation of future demand for employees
– Top-down forecasting involves senior managers allocating a
fixed payroll budget across organizational hierarchy
– Demand for employee skills requirements must also be
considered
 Aggregate Planning

• Forecasting supply
– The level and quantities of abilities, skills &
experiences can be determined using Skills
Inventory.
– Annually updated human resource information
system (HRIS) is dynamic source of HR information
– Markov analysis can be used to create transition
probability matrix that predicts mobility of
employees within organization
 Strategies for Managing Shortages
• Recruit new • Work current staff
permanent employees overtime
• Offer incentives to • Subcontract work out
postpone retirement • Hire temporary
• Rehire retirees part- employees
time • Redesign job
• Attempt to reduce processes so fewer
turnover employees are needed
 Strategies for Managing Surpluses

• Hiring freezes • Across-the-board pay

• Do not replace those cuts
who leave • Layoffs
• Offer early retirement • Reduce outsourced
incentives work
• Reduce work hours • Employee training
• Voluntary severance • Switch to variable pay
leaves of absence plan
• Expand operations
 Succession Planning

• Involves identifying key management positions

the organization cannot afford to have vacant
• Purposes of succession planning
– Facilitates transition when employee leaves
– Identifies development needs of high-potential employees &
assists in career planning
• Many organizations fail to implement succession
planning effectively
– Qualified successors may seek external career
advancement opportunities if succession is not forthcoming
 Guidelines for Effective Succession Planning

• Tie into organization’s strategy (and modified accordingly)

• Monitor the progress and measure outcomes of succession

planning initiatives

• Ensure that all HR functions that impact the succession

plan are iterated and working in tandem

• Ensure centralized coordination of succession planning

• Engage and involve managers throughout the organization

 Reading 5.1
Designing Succession Planning: Lessons from the Industry
Leaders

Typically organization have utilized one of three approaches

to managing diversity

• an assimilation view that downplays differences;

• an access view that focuses on building diversity in order
to gain access to ethnic consumer groups;
• an integrated view that emphasizes uniform performance
standards, personal
• development, openness, acceptance of constructive
conflict, empowerment, egalitarianism, and a
nonbureaucratic structure that encourages challenges to the
status quo
 Reading 5.1
Designing Succession Planning: Lessons from the Industry
Leaders

• An integrated approach combined with a culture of inclusiveness are

needed to ensure diverse succession planning.

• Commitment from and direct involvement by the CEO and senior

leadership team are mandatory for diverse succession planning

• Employees should be encouraged to look upward in the organizational

hierarchy to indentify people who are like themselves

• Specific programs which target women and minorities are needed to

bring about change in the status quo as they may not see people like
themselves in positions higher than the one they hold
 Reading 5.1
Designing Succession Planning: Lessons from the Industry
Leaders

• Cross-race mentoring requires that mentors have

skills related to understanding diversity
• Cross-gender relationships need to be carefully
managed to prevent any perceptions of
impropriety
• Organization’s such as Denny’s have made
thresholds of representation of minorities and
women in management a key component of
executives’ annual bonuses
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation
Lessons from Corning Incorporated Human Resources

As part of the planning process, four transformation

goals were developed which guide the
organization’s growth (see Figure 1)
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation Lessons
from Corning Incorporated Human Resources
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation Lessons
from Corning Incorporated Human Resources

These goals resulted in a four-step process which gave

business unit generalists comment tools land
language for translating strategies into action steps
for talent development and allow consistency and
comparison for prioritization across business lines
(see Figure 2)
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation
Lessons from Corning Incorporated Human Resources
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation
Lessons from Corning Incorporated Human Resources

Corning’s annual strategic planning process for HR brings

together several key components including:
• corporate strategy and the implications of that strategy for
HR
• HR function strategy including the strategic direction for
each of the COEs
• the outputs of the Human Capital Planning process for
each of the business units, which is essentially the HR
implications of each of their business strategies

(see figure 3)
 Reading 5.2
The Annual HR Strategic Planning Process: Design and Facilitation
Lessons from Corning Incorporated Human Resources