Workforce Planning: Connecting Business Strategy to Talent Strategy

Newman Group Overview The Newman Group provides expertise and solutions to help companies align people, processes and technology and achieve success in all facets of talent management. Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Should we be breaking down the silos? Strategy Process Integration Common Language (DNA) Scalability (Tools) Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Talent Management Framework CORPORATE VISION, CULTURE & STRATEGY Alignment Strategy TALENT STRATEGY, ORGANIZATION & WORKFORCE PLANNING Alignment Organization Design/ Talent Acquisition Succession Planning Development Process Performance Executive Leadership & Team Management Recruitment Development Employee Compensation Learning & Engagement & Planning Development Retention Language Common Support & Sustain COMPETENCY DEFINITION & ASSESSMENT Scalability Support & Sustain SYSTEM ENABLEMENT 5 Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Workforce Planning in Crisis Mode 67% of companies conduct workforce planning on an “as needed” basis…   Relocation   Mergers and acquisitions   Change in leadership   Change in company strategy   Global expansion   Diversifying the workforce Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Key Findings in Workforce Planning   The majority of organizations are ineffectual at predicting future talent demands.   Workforce planning fails when it is viewed as an HR issue rather than a business issue.   The industries most heavily impacted by aging talent are also the same industries placing a heavy priority on strategic workforce planning.   Strategic workforce planning will not happen overnight Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

The Workforce Planning Process Define Project Evaluate Define the Gap Objective Demand Supply Gaps Management Qualitative Quantitative Develop an analysis to analysis of action plan to determine key critical close the gap Gather the data needs employee data Build from the elements Define and Development for business plan Headcount needs prioritize the internal talent Headcount data movement or business Financial needs gaps between strategy to Overhead Financial data the qualitative Buy Labor determine the Training Overhead demand and Acquire talent Labor externally direction of the Training the quantitative workforce plan Marketing needs supply Borrow Critical roles for the go Marketing data Augment headcount to market strategy Critical roles for the go with contract or to market strategy temporary labor Risk Mgmt/Budgeting needs Risk Mgmt/Budgeting Bounce Scenario modeling data Planned attrition Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Ordinary Metrics & Measures with WFP Lens   Turnover –  Typically we look at Voluntary vs. Involuntary –  Focus is on reducing voluntary   Performance Ranking –  Typically 5 point rating scale –  Often a forced distribution   By looking at turnover data by performance category, you can create a Retention Index –  Comparing the average turnover rate to the rate of turnover within a specific category Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Retention Index Formula: Ave Turnover % – Ave Turnover % in Demographic = Retention Index Performance Category Needs Does Performance Far to not Rank All Exceeds Exceeds Meets Improve meet # Employees 6500 300 1300 3500 1000 400 Total Turnover 1625 75 450 600 200 300 Turnover % 25% 25% 35% 17% 20% 75% Retention Index 0% -10% 8% 5% -50% Talent Leak Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Retention Index Formula: Ave Turnover % – Ave Turnover % in Demographic = Retention Index Employee Tenure More than 11-15 5-10 1-4 Less than Tenure All 15 years years years 1 year # Employees 6500 300 1300 3500 1000 400 Total Turnover 1625 25 200 700 550 150 Turnover % 25% 8% 15% 20% 55% 38% Retention Index 17% 10% 5% -30% -13% Talent Leak Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Scenario Modeling Example Current Workforce Plan Industry Trends Political Developments Labor Changes New Business Strategies Future Workforce Plan Impact Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Workforce Segmentation Example Talent Segment and Value Potential Strategic Action Strategic Critical to driving long-term competitive advantage, with specialized skills or Roles knowledge that Core affect the strategy The “Engine of the Enterprise,” unique to the company and core to delivering on its products and/or services Requisite Cannot do without, but whose value could be delivered through alternative staffing Roles strategies (e.g. off-shoring, outsourcing, affected replace w/technology) Non-Core by the strategy Talent whose skill sets no longer align with the company’s strategic direction Source: The Conference Board “Strategic Workforce Planning, Forecasting Human Capital Needs to Execute Business Strategy”; via Corning Incorporated Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Why is it so hard to get WFP off the ground?   Because it comes at you from the top down   But you need to build from the ground up Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Building Workforce Planning Capability Environmental Influences Business Strategy and Business Operational Strategy Operating Model Effectiveness Window Views Operational & Strategy Drivers Age/ Retirement Diversity Mergers & Strategic Planning Knowledge Analysis Strategy Acquisitions Lens: 18+ months Transfer Restructure or Capability Expansion Operational Lens: Retention Headcount Management Typically annual Management Forecasting Upper Levels Target Critical Talent Sets Level 1 Consistent Workforce Planning Methodology Analy Mana TM Forecast Evaluate WFP Objective ze ge Strate Demand Supply Gaps Gaps gy Basement Level Mining Internal & External Data Internal data warehouses or systems Environmental Trends such as: such as: HRMS, Financial Systems, ATS, Competition, Labor supply, LMS, etc. demographics, etc. Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved. Copyright © 2009. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

You don’t have to make everyone an expert at WFP Workforce Planning COE Shared Services COE Framework HR Business Partners Talent Management based on Applied Intelligence Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Getting Started   What is the annual business planning cycle?   What additional level of talent planning will have the most impact?   Who will embrace it? Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Q&A Email: TheNewmanGroup@Futurestep.com Visit us online at: www.tng.futurestep.com ed.newman@futurestep.com Copyright © 2010. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

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Workforce Planning: Connecting Business Strategy to Talent Strategy

by beeshields on Jan 29, 2010

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