1. Review
Workforce Solutions
Powered by Bright Ideas
®
DECEMBER 2011/JANUARY 2012 The Official Journal of the International Association for Human Resource Information Management IHRIM.ORG
HR’s Key Role in Strategic
Workforce Planning:
Aligning the Workforce
with Long-Term
Business Objectives
Annual Buyer’s Guide
on Page 25

2. Feature
force based on an organization’s vision, strategic plan,
budgetary resources, and a set of desired workforce
competencies to be best prepared for the future.
Workforce planning involves:
• Identifying future workforce needs and capabilities
(including skills, knowledge and expertise) as derived
from the strategic plans;
• Developing priorities and cross-linkages between the
strategic plans and the operational plans;
• An analysis of current staff numbers and capabilities;
• An analysis of available and projected funding levels;
• Identifying the gap between current and future work-
force needs; and,
• Developing workforce plans – outlining the strategies
that will be implemented in order to progress from the
current situation to the future forecasted situation.
An Approach to Workforce
Workforce planning provides managers with the means
Planning by the 21st of identifying the competencies needed in the workforce,
not only in the present but also in the future, and then
Century HR Business selecting and developing that workforce. The purpose of
workforce planning is not to decide what you will do in the
Partner future; it is about determining what you can do.
By North Highland Consultants Developing a Mature HR Business Partner Model
(HR in the 21st Century)
ost successful organizations say they do work- Human Resources functions are being looked at in a
M force planning in some shape or fashion. What
they usually mean is they hire people, promote
some, fire, or retire the rest – all routine employee life
new light in the 21st century. Many companies employ
human resources business partners, but is this just a new
phrase for a senior level generalist supporting a dedicated
cycle activities. Here’s how you can tell workforce plan- client group within an organization? What, exactly, is a
ning is more of an aspiration than a strategic process mature 21st century human resources business partner
that helps run the organization. You ask questions like (HRBP) model and why is it important in executing work-
these and hear silence: 1) What role do your HR business force planning? In an HR business partner model, HR
partners play in managing and developing your talent professionals participate in strategic planning to help the
pipeline? 2) What’s the calculated risk to operations if we business meet present and future goals rather than
don’t manage turnover and expected retirements? 3) concentrating solely on transactional duties such as bene-
Which positions drive top and bottom-line impact and fits, payroll and employee relations. As more organizations
are critical to our operations? migrate to a shared services organizational structure for
A fully enabled workforce planning process helps benefits, payroll and employee relations, this new organi-
answer these questions when you deploy HR practition- zational structure allows the HRBP model to place more
ers to work closely with the business; use workforce plan- dedicated time towards workforce planning. The HRBP
ning analytical tools to create decision-making data; and model, in a mature state, drives the corporate strategic
leverage other strategic partners to help make your busi-
ness case for workforce planning outcomes.
Workforce planning is an integral part of the strategic
management process. It primarily covers the end-to-end Human Resources functions are
process that better enables an organization to identify its
human capital demands and supply of suitably skilled being looked at in a new light in
human resources to help meet its operational objectives. It the 21st century.
is intended to be a continuous process that gives managers
the tools necessary to create plans to develop the work-
www.ihrim.org • Workforce Solutions Review • DECEMBER 2011/JANUARY 2012 31

3. planning process through data and analysis that serves to mean the need for a flexible workforce (remote, job
inform the business on the feasibility of business require- sharing, compressed workweeks, full- or part-time
ments. Human resources business partners have the status, using on/offshore resourcing, using contingent
unique opportunity to see the business in a multi-faceted workers). Managing dynamic staffing models requires
capacity. Human resources business partners are equipped tools that can analyze and process these various needs.
to support and deploy HR initiatives, but also have the Useful tools include a robust head-count management
opportunity to participate in the daily activities of the reporting tool reviewed by management weekly, as
business unit (BU) or division in which they support. This well as a head-count procurement engagement form.
“deep dive” into the operation requires HR professionals • The historical trends of the company – It is important
to think as business owners. We have found that an opti- to understand the historical talent needs of an organi-
mally performing HRBP has a strong relationship with the zation by analyzing trend data such as company hiring
Finance organization, as well as with its traditional align- patterns, employee turnover, average years of service,
ment within HR operations. In addition, fully functioning transfers, promotions, the quality of new hires
HRBPs proactively review data and use it in a transforma- employee demographics, and span of control. Addi-
tional fashion. tional information on the skill-sets of the employee
The core of our approach to workforce planning is its base is also important. Tools like a development
emphasis on its execution by a mature 21st century HRBP investment assessment can be very helpful in review-
model that utilizes various tools, including predictive ing historical trends.
analytics, and various internal strategic cross-functional
partnerships, including those with Finance, to optimize Benefits of Using Workforce Planning Tools:
the delivery and value to be realized through these efforts. • Structured, analytical ways to balance organization
The true power of mature workforce planning is achieved needs versus the supply of the labor force,
primarily by three major elements: structural/functional • Optimal scenario analysis performance based on a
HRBP model, workforce planning tools (including predic- wide array of factors, and
tive analytics), and strategic partnerships (including those • A way to forecast staffing needs based on business needs.
with Finance).
Within this context, the 21st century HRBP practitioner Most companies evaluate needs based on a short-term
would participate in: perspective; however, leading companies will also look
• Future strategy planning, long-term (three to five years) to assess their labor pool
• Annual business planning, and plan to meet future business needs.
• Financial planning,
• Understanding the current workforce, and Emphasis on Predictive Analytics by HRBP
• Setting the workforce direction and plan for the next
One such opportunity is in the area of predictive analytics
three to five years.
to assist in workforce planning. What does the term predic-
tive analytics mean? Predictive analytics can be defined as
A successful HRBP leverages powerful tools and part-
collecting traditional attrition, hiring, and training data in
nerships within and across the organization.
real-time; not a month or months in arrears. Data can be
utilized to forecast trends/themes to be shared with BU lead-
Tools to Aid in Workforce Planning ership, Finance, and recruiting teams to set future planned
Workforce planning tools enable organizations to analyze activities on a routine basis. In addition, it requires reporting
and forecast the people needs for their organization. These to be significantly more robust than simple metrics, such as
tools help organizations focus on hiring and retaining the when attrition is running at 10 percent.
right employees for their workforce and offer an analytical
approach to hiring/staffing and retention goals. The Importance of Real-Time Data
Predictive analytics are an extremely important set of
Points of Consideration:
tools to help shape an organization for future successes. It
• Complexity of your people/staffing needs – This can
is common for Human Resource’s Operations’ staff to
extract high-level data such as summary attrition, hiring
and training hours. The data is then shared at the BU or
Workforce planning tools enable division level in a monthly or quarterly operations review
with management. More often than not, these reports are
organizations to analyze and “yesterday’s news” long before they are shared with busi-
forecast the people needs for ness management. In addition, reporting is not widely
embraced and analyzed in detail by an HRBP. Very impor-
their organization. tant questions about the greatest expenditure and asset of
your organization, its people, go unasked. Unfortunately, a
32 DECEMBER 2011/JANUARY 2012 • Workforce Solutions Review • www.ihrim.org

4. company’s human capital is often just assumed to be a
resource to perform a role within the organization. Today’s It is important to emphasize that
business environment requires an organization to be
nimble and flexible based on external pressures unique to
predictive analytics is a recipe that
its industry and organization. Predictive analytics is an involves using all available HR data
area that can be vital to a business maintaining its compet-
itive edge on competition.
as described above, but is in no
Predictive analytics plays a vital role in not just maintain- way intended to be the exhaustive
ing a business but growing the unit and increasing company
profits. Using attrition data and drilling down to a granular list of data.
level (role, location, tenure, reporting manager, department,
level, regrettable/non-regrettable, management/staff, high
ness. Data-driven decisions are a powerful tool when
potential, high promotable, etc.) provides a more telling
speaking with business leaders and the use of predictive
story to help an organization understand root cause.
analytics can be the conduit for fiscal prudence and reten-
tion of your intellectual capital.
Staying Ahead of the Hiring Curve It is important to emphasize that predictive analytics is
The same scenario can be used for hiring and training a recipe that involves using all available HR data as
data. We have found that by having the HRBP own and described above, but is in no way intended to be the
manage the hiring plans in real-time allows for dynamic exhaustive list of data. The HRBP has the opportunity to
prioritization. In addition, using specific, defined cate- blend many pieces of data that, when used together, iden-
gories for looking at staffing needs such as type of project, tify trends/themes that may not be visible when viewed
funding sources, etc., can be a strong rationale to discuss individually. Our experience with this approach has been
planning weekly. In order to be prepared for staffing on- very positive and we have seen how powerful it can be in
demand, there is a need for a pipeline of talent ready to driving towards a lean business operation.
onboard or deploy at a given moment. The use of predic-
tive analytics is crucial in identifying those pockets in the Partnering with Finance to Underpin Your Work-
most cost-effective manner. It is common to hear a force Planning and Model
manager say, “I need this role yesterday,” and the role has
The average organization dedicates more than a third of
just made its way to HR today. Human Resources business
its operating expenses to workforce labor costs. However,
partners can anticipate this event by using predictive
most organizations struggle to quantify the return on this
analytics and having a plan developed to share with the
significant investment. Many organizations rely heavily on
hiring manager. While it is not possible to predict how
the instincts of their management team to manage their
long it will take to find the ideal candidate or place that
workforce. In contrast, the most successful organizations
candidate in the role, it is possible to have the pre-work
manage their human capital as a strategic asset by aligning
completed quickly and recommend solutions so the main
their workforce with organizational strategies and using
event can focus on the candidate selection effort.
metrics and measurements to drive decisions, monitor
Training analytics are vast and typically do not connect
performance and improve results.
with hiring and attrition. We have found that by using train-
In today’s economy, successful business leaders are
ing reports and blending with attrition and hiring data, the
eager to better understand how each human capital driver
results can be very powerful. The use of succession manage-
impacts the business strategy. These leaders recognize that
ment data (pipeline charts, emerging talent, high potential,
changes in business strategy typically place new demands
high promotable, critical to keep) along with reporting on
on the existing workforce and may require the need for
targeted training opportunities for these groups emphasizes
new talent. They are always looking for a better set of
the importance on human capital retention.
analytics to explain the drivers and benchmarks that drive
the organizational decisions they need to make. These
Data-driven Decision-making decisions often impact changes to supply chain, delivery
Workforce analysis has been taboo for many HR profes- models, and investments in technology and talent manage-
sionals due to the “firefighting” approach HR has played in ment, which ultimately drive business execution.
supporting business operations. The concept and develop- Leaders also need a mechanism for measuring and
ment of predictive analytics allows HR professionals to monitoring progress. A sound workforce planning model
drive business decisions and positions the HR professional supported with financial information provides business
as having a vested interest in operations. This partnership leaders with the insight they need to truly understand
is solidified by hiring HR professionals that are skilled in where to spend their time, effort and budget.
analysis, financial operations and strategy design/deploy- Workforce planning provides business leaders with the
ment. Practitioners highly skilled with using Excel can full business transparency needed to balance organiza-
provide a great value-added benefit to support the busi- tional efficiency with customer and employee satisfaction.
www.ihrim.org • Workforce Solutions Review • DECEMBER 2011/JANUARY 2012 33

5. Finance supports the workforce plan by providing HR with About the Company and Authors
key decision support data to help:
North Highland is a global consulting firm that has
• Meet long-term workforce demand in the most cost-
changed the model of how a consultancy serves its clients
efficient manner,
by hiring only experienced consultants who live and work
• Reduce capital investment in additional workforce
where its clients live and work, leveraging its global
capacity and improve profitability, and
network of service area expertise. North Highland helps
• Better understand the impact of changing demand and
business, government and non-profit clients define strate-
other business changes via robust scenario analysis
gies, streamline operations, empower people, integrate
capability.
suppliers, leverage technology and maximize customer
interaction thus sustaining successful, long-term relation-
In order for workforce planning concepts to become
ships by helping clients achieve their business objectives
routine, data-driven, decision-making business practices
again and again.
in an organization, HR practitioners need to collaborate
Terrence R. Andrews, SPHR, LSS GB, senior manager,
with their Finance counterparts to ensure that business
has 18 years of experience in both in-house and in profes-
leaders associate the benefits (in real money) of a well-
sional services capacities within the financial services,
planned workforce model to top- and bottom-line business
technology, entertainment and professional services indus-
performance. Workforce planning done without Finance’s
tries. He has a B.S. in Human Resources Management
participation is usually heavily scrutinized and rejected by
from Syracuse University-Whitman School of Manage-
executives or considered “dead-on-arrival” if the following
ment. He can be reached at Terry.andrews@north
questions can’t be answered:
highland.com.
• What’s the impact to our bottom line?
Nicole M DeNunzio, manager, has seven years of
• What risks are we mitigating?
expertise in forecasting and planning, process design,
• How much should we invest?
financial/management reporting, and full life cycle-
• When do we see a return on our investment?
enabling technologies. She has a Bachelor of Arts in
Marketing from Kent State University and a Master of
It is important that HR practitioners are well-informed
Business Administration in Finance and Management
on the financial impacts of decisions that affect the work-
from Crummer Graduate School of Business at Rollins
force and are able to talk about the opportunities and risks
College. She can be reached at Nicole.DeNunzio@
in real numbers. An effective workforce planning model
northhighland.com.
with input from Finance always takes into account the
Jesse Fellerman, manager, has over eight years of expe-
financial impact workforce planning has on the business
rience in executing workforce transformation consulting
–providing justification for resources.
services in both commercial and federal sector organiza-
The data generated and analyzed by an HRBP becomes
tions, and has a Bachelor of Arts in Economics and Politi-
the input to the annual planning process for human capital
cal Science from Colgate. He can be reached at
needs, as well as monthly forecasting exercises. The strong
jesse.fellerman@northhighland.com.
partnership with Finance can allow the business to be
Cynthia Jones, principal, has more than 20 years of
more prepared for planning projects and staffing on-
client service experience in HR function and process
demand, a trend occurring today. Leveraging Finance as a
improvement, organizational design, change management,
stakeholder helps HR tie employee variables to the organi-
large scale transformation, SAP implementation experi-
zation’s financial outcomes – both historically and for
ence. She has a Bachelor of Science in Management from
predictive purposes. For example, Finance can assist HR
Miami University and can be reached at
in calculating such measures as revenue per employee,
Cynthia.Jones@northhighland.com.
overtime costs, predicted overtime cost in the next rolling
Scott Cranford, SPHR, CCP, senior consultant, has 30
12 months and beyond, surplus payroll measures, earnings
years of HR experience in construction, manufacturing,
per employee, and revenue by human capital spend. When
retail, engineering and corporate environments. He has a
workforce planning and analytics are tied to the business,
Bachelor of Arts in Mathematics from Baylor University
these types of analytics and trends are brought to the fore-
and is a member of SHRM and WorldatWork. He can be
front so that management can take action and often
reached at scott.cranford@northhighland.com.
provide a number of “low-hanging fruit” opportunities to
Marcus Walker, senior manager, has a Bachelor of Arts
make business improvements.
Cum Laude from Howard University, and a Master of
In summary, we believe the use of robust reporting
Public Accounting in Public Financial Management from
tools, which blend and analyze multiple data sources,
Syracuse University-Maxwell School of Citizenship and
provides great opportunity to your organization to keep
Public Affairs. He can be reached at Marcus.Walker@
ahead of the competition. The 21st century HRBP model
northhighland.com.
and its practitioners’ use of predictive analytics and strong
partnership with Finance is a proven recipe to successful
management of human capital with organizations.
34 DECEMBER 2011/JANUARY 2012 • Workforce Solutions Review • www.ihrim.org