Workforce Planning A Framework and Tools for Competency Development and Forecasting Workforce Planning What is it? Workforce Planning Workforce planning is the process of ensuring the right people are in the right place at the right time to accomplish the current and future objectives of an organization. It entails envisioning and analyzing the future operating environment of a business and planning for organizational capabilities needed in the future (3-5 years out). The outputs of workforce planning drive actions by business leaders to improve workforce performance and achieve business objectives. Workforce Planning Workforce planning enables an organization to: -- have a line of sight to the ebbs and flows of its workforce; -- determine the type and size of the workforce needed for tomorrow's success; -- bridge talent gaps; -- achieve maximum organizational effectiveness by proactively planning talent needs -- support “human asset management” -- avoid surprises and even out the peaks and valleys in recruiting and workforce restructuring Workforce Planning Two components: Assessment of organizational capabilities that takes into account the quality (competencies) and quantity (headcount) of a workforce. Forecasting translates organization needs to specific numbers and types of talent needed in an organization taking into account fact-based history and business objectives. Workforce Planning A workforce planning model is one which is: Holistic in approach -- involves all aspects of the business Built on anticipated customer/service needs and skills required to meet/deliver them Integrated with operations and financial planning Responsive to changes and developments in business strategy Driven and championed by management Conducted annually / reviewed quarterly and/or as events dictate Approached with the same rigor and analytical focus as managing customers, product inventory, real estate, technology and forecasts Workforce Planning Who needs to be involved? Senior management Finance Human Resources Line managers from all business units Workforce Planning How is it done? Workforce Planning SIPOC Supplier Input Process •Mgmt Board •GOC Strategic Plans •Business units •Company Strategic plans •Line managers •Divisional Strategic plans •Finance •Succession Plans •Human Resources •Organization challenges Output •Future state”: organization competencies, structure and roles required to achieve business objectives •GOC management •Plan to address workforce gaps •Finance •Annual forecast of numbers and types of talent required •Environmental scans •HR strategic plans •Benchmarks Document current state: org structures, high-level work processes, including departmental interfaces, behaviors, skills, competencies and succession plans. •Mgmt Boards •Line leadership •Human Resources •J&J Professional Recruiting •International Recruiting •College recruiting teams •Affirmative Action Plans Conduct full review of future business strategy, challenges, turnover and attrition trends. Customer Focus of WFP Identify future needs in organization structure, behaviors, skills, and competencies to support the business. Also consider succession plans. Conduct gap analysis to identify areas of need and numbers of people needed. Translate gaps into a plan that identifies steps needed to move from current state the future requirements, and build an annual staffing plan. Diagnostic Questions Business strategy: What are the key business strategies of the next two to three years that have people implications? Ongoing review What roles are critical to driving long-term strategic advantage for the business in terms of their impact on desired top-line growth and/or innovation and speed to market? What roles possess the unique capabilities that make our strategic advantage difficult for competitors to copy? Core values: What are the key values of our organization that need to be built into our strategic people plan? Competencies: What are the key competencies (things we need to excel at) of our organization that will maintain our competitive advantage? Diagnostic Questions Organization skills: What are the key areas of capability our workforce needs in order to achieve our business strategy? What roles are essential to delivering quality products and services to our customers? Ongoing review What roles have the most impact on our ability to drive consistent results and improvement in our core business processes? Are these roles specific to our company and not translatable to other companies or industries? Is this role difficult to source in the marketplace? Would external hires need significant training before becoming effective? Could the role be staffed differently or outsourced? Environmental issues: What are the key environmental issues impacting our organization that have people implications? Human resources issues: What are the critical human resources issues facing our organization that may limit our success? Stakeholders: What are our key stakeholders’ concerns and issues with regard to our talent? Workforce Planning Part I: The Competency Analysis Competency Analysis What is a Competency Analysis? • A validated way to better understand current leadership and technical skills and identify future leadership and technical skills needed in an organization. Why should we conduct one? • To identify the current “inventory” of the leadership and technical skills in the organization, along with gaps • To prioritize future needs • To provide a framework for development discussions for all existing associates Competency Analysis Cycle STEP 4: (timing) DEVELOP plan to address gaps in current versus future competencies • Identify next steps with HR and business leaders OUTPUT: Action Plan to identify, recruit, and/or develop talent with these competencies STEP 1: (timing) IDENTIFY current and future leadership and technical competencies • One-on-one interviews with line leadership • Review business short- and long-term objectives • Develop list of competencies required to support business objectives • Review current job descriptions • Review resumes of current staff OUTPUT: Draft of current and future competencies STEP 3: (timing) ASSESS organization’s competencies against current and future competencies • Associates assess themselves against these competencies • Managers validate assessments OUTPUT: Competency Model for organization STEP 2: (timing) VALIDATE current and future competencies with business leaders • Meet with business leaders • Present competencies and receive feedback OUTPUT: Revised list of current and future competencies Workforce Planning Part II: The Staffing Forecast Why Forecast? Gain a thorough understanding of the current workforce: who is here, who is coming, who is leaving? Develop a proactive plan that anticipates and proactively identifies talent needs rather than “fill seats.” Enable talent acquisition organizations (i.e. Staffing) to proactively plan for and meet talent demands. Ensure you have the talent you need when you need it. Matching external supply and demand against future requirements of business Position business to be competitive in the market place. Key Business Processes Strategic Planning Annual Business Plan •Identify the key strategic drivers of the business in the next 3-5 years •Develop specific annual business, financial and nonfinancial objectives Staffing Plan •Headcount: current and projected •Forecast of vacancies •Proactive plan to fill vacancies Workforce Planning spans the continuum and is a dynamic process Forecasting SIPOC Supplier Input Process •Mgmt Board • Succession Plans •Business units • Talent Navigator •Finance • Organization charts •Line managers • Budgets and headcount allocations •Human Resources • Personal development plans Output •Specific staffing plan and sourcing strategy •Defined key business drivers and objectives •Challenges of meeting\ objectives •Identification of talent gaps • Turnover data Customer •Mgmt Boards •Line leadership •J&J Professional Recruiting •Human Resources •Finance •College Relations and college recruiting teams •Talent agencies (i.e. Kelly Services) • Competency models •Affirmative Action Plans Analyze department business goals and objectives for next 12-18 months to identify staffing drivers. Analyze current workforce demographics to develop an accurate “historical picture” of the ebbs and flow of your organization. Assess the impact of staffing drivers and historical data to develop a forecast of projected headcount needs. Use the forecast to proactively source for talent versus “filling jobs.” Forecasting Staffing Drivers of a Forecast* = + Historical Data Future Events • # and types of positions filled annually in prior 2 years • Business expansion (i.e. mergers) or contraction (divestitures) • Trends in hiring statistics • Changes in product mix: New products, line extensions, new indications • Types and sources of hires • Location(s) of hires (i.e. geographic region) • Turnover/retirements/separations • Expansions and restructurings • Competitor activities (i.e. new product launches) • Changes in technology or productivity improvements • Changes in markets or customer base • Changes in FDA and other government regulations • Major projects, capital expenditures (i.e. GOC strategies) *Forecast must be adjusted as significant internal and external events emerge. Historical Data: Your Workforce Today Source: data extracts Source: Ongoing discussions with management Source: Succession Plans What is your company’s/area’s annual rate of total turnover? What is your company’s/area’s annual voluntary turnover? How many people in your company/area are eligible to retire this year? How many do you estimate will actually retire? Will a significant group of senior or critical employees retire at the same time? What events may influence turnover this year? What does your area/division need in terms of knowledge, skills, talent to support the business this year? Do you have that talent today? What skill deficits are evident today? What is your plan to address the deficits? Is your succession plan robust (i.e. two replacements “deep” for all critical positions? Historical Data: Your Workforce Today Source: Ongoing discussions with the line and senior management How have you typically filled vacancies? Succession plans, recruitment, college hires, internal moves? What is your use of contractors? Should replacements include experienced employees? “Bottom up” or “homegrown” talent? Were there any “special causes” that impacted your workforce in the last year / two years? What demographic mix are you striving for in the “future” organization? As replacements are needed, will special or targeted recruiting programs be required to attract the talent? Are you currently competitive in the marketplace? Are you at risk of losing multiple employees in specific groups due to compensation, talent poaching competitor ramp-ups or insufficient facilities? What is the projected impact on the workforce of these factors? Determining Staffing Drivers: Examples of Probing Questions R&D: What new products are in the pipeline? In competitors’ pipelines? When are new products anticipated to hit the market? How do you expect government regulations to impact your business (i.e. more or less requirements?) What therapeutic areas do you compete in or seek to establish a presence in? Will you focus on developing new chemical entities in house or license in? What are your most critical business drivers, goals and initiatives for 2005? For 2006-2010? What products may/will be taken off the market that will impact the business and current structure? Determining Staffing Drivers: Examples of Probing Questions Operations: Manufacturing/Supply Chain/Q&A Are new products coming into production? How many? What types? When? Is the demand forecast for product higher/lower/the same from prior years? Are there more facilities being built or planned to be built to accommodate new products? Are facilities being phased out or transitioned to contract manufacturing? How will automation or productivity gains be factored in? How do you expect government regulations to impact your business (i.e. more or less requirements?) How have customer requirements impacted your business (i.e. more or less requirements)? What are your most critical business drivers, goals and initiatives for 2005? For 2006-2010? Determining Staffing Drivers: Examples of Probing Questions Marketing and Sales: Are new products coming to market? How many? What types? When? Is the demand forecast for product higher/lower/the same from prior years? How will you market your products? Direct sales? Direct to consumer? Detailing? Will your sales force need to expand or contract as a result of a different product/service mix in the future? Will you need sales representatives with the same skills as the current sales force? If no, how will they differ in the future? What are your competitors doing? What is the external marketplace like? Determining Staffing Drivers: Examples of Probing Questions Marketing and Sales: How do you expect government regulations to impact your business (i.e. more or less requirements?) How have customer requirements impacted your business (i.e. more or less requirements)? What are your most critical business drivers, goals and initiatives for 2005? For 2006-2010? Using the Forecast The forecast you develop will be data-based to provide “direction” on how to meet the anticipated talent needs of your organization. The forecast is a starting point – a means to an end – but not the end. The forecast is not a ‘headcount tool’ – it is a staffing planning and management tool for openings (vacancies, new positions). Think about the implications of the forecast not only in terms of people, but space, training, equipment, etc.
