HR Management··7 min read

HR Planning 101: What Is It? And How Should It Be Done?

HR Planning

The human resource department is one of the most important sections of a company that oversees important roles like HR planning to ensure the smooth running of the business. While many companies don’t fully understand the importance of HR planning, this important process is if businesses are to understand their current situation and get better insights into their future needs.

What is HR Planning?

Human resource planning — also known as HR planning in short, refers to the collective efforts that you dedicate towards having the right staffing levels to handle present and future business needs. There are several strategies involved in strategic hr planning. For instance, you must analyze the current workforce performance. Apart from that, you must also align your workforce needs with your business strategy. This will enable you to identify gaps you need to fill and find strategies that allow you to fill those gaps before shortages occur.

What is the Importance of HR Planning?

Many companies view the HR department as a cost center. However, that is the wrong approach. Instead, this department must be viewed as a section that can be used to drive business growth. One of the most important tasks of the HR planning process is to ensure that the company is better prepared for the future. This can be done by ensuring the company is properly staffed to handle all the work that comes its way. Here is how HR planning should be done.

Analyze Current Workforce Performance

Before implementing any changes within the company, it is important to first analyze the performance of the current workforce. This is what will lead to effective HR planning. There are several questions that you must answer if you want to get a clear picture of the current landscape:

  • What skills are currently available in the company?
  • Are you making the most out of these skills?
  • How good is the performance of your current workforce?
  • Who are the highest performing employees, and who needs help or an extra push?
  • Who is being compensated properly, and who needs a raise?
  • Is everyone in the company happy?
  • Are any of your employees planning to leave your company?
  • Is there a way you can ensure that your top talent doesn’t leave your company?

How to Analyze Workforce Performance

To properly analyze the performance of your current workforce, there are several steps that you need to take:

Perform employee surveys: The best way to find out what skills are available in the company is to ask the employees themselves. If you perform a skills survey, you will be able to find out what skills you have in-house currently.

Investigate employee satisfaction: This can also be done via a survey. However, it’s better for everyone if the employee satisfaction survey is done anonymously. This way, you can measure worker satisfaction accurately. In your survey, include questions about what makes employees unhappy and then find out how you can improve.

Analyze performance management data: This is one of the best ways to identify employees who need extra training and coaching. You will also be able to see those who are overperforming so you can promote them or give them raises.

Forecast Future Needs

After you obtain a clear picture of your current workforce skills and how your employees are performing, you must take the next step and forecast what skills your company needs and how many people you need to match this demand. To accurately assess the future needs of your company, you must have the company’s five-year and ten-year plans. That way, you will know what direction the company is headed in and what challenges it’s likely to face.

How to Forecast Future Needs

For you to be able to accurately forecast the future needs of a business, you need to gather as much detail as you can about the business and industry. Here is how that can be done:

  • Run industry analysis: After you have obtained a clear picture of the company’s direction, you must look into what sort of skills the company will need to ensure that it stays competitive in the future. It’s advisable to take some time and look at industry reports to learn about future trends and skillsets.
  • Analyze the company’s competitor: You must always keep a close eye on the company’s competitors. Remember, these companies will likely be going through the same process as you. Therefore, it’s important to study what they will be doing. For instance, you can visit your competitor’s website or social media platforms to view what job openings they have and, therefore, what talent they are planning to acquire. You must also analyze their current skillsets to see if there is anything you are lacking.

Spot Gaps in Your Workforce

After analyzing what you need and what you currently have, the next step is to identify gaps in your workforce. This is known as supply and demand. To carry out this process effectively, you will need to have comprehensive data from the first two steps of HR planning. You must also have at your disposal the necessary embedded analytics tools and skills to run this assessment.

How to Identify Gaps

The moment you have a clear picture of the skills you have currently, and the skills you will need for the future, it will be easier to assess whether there is a gap between the two.

First, you need to create a skills inventory. The idea is to come up with a list of the skills you need, and then you can slot in the current skills available to you. That way, you can clearly see what is available and what is lacking. If you have successfully run the necessary employee surveys, you must already have all the necessary information needed to carry out this step.

Second, you will need to understand surpluses. This means that apart from identifying gaps, you might also identify skills that you have currently but won’t need in the future. Sometimes you might just identify that you won’t need too many of these skills and roles in the future. That way, you can start investing in ensuring that these employees acquire the necessary skills that you will need so they can continue to play a part in your company.

Fill Skills Gaps

The skills that are needed in the workplace keep changing, and they will likely undergo major changes in the next 20 years. Part of effective HR planning is ensuring that you are prepared for these changes. Failure to do that will result in you falling behind. This is because these skills take time to deliver, so you might end up with a skill shortage in years to come. You must draw up plans for how you will start developing skills for the future, and these plans involve identifying who would be best placed to learn these new skills. Lastly, you must also find the necessary courses to develop these skills on your own.

The plan to fill skill gaps must be properly aligned with your business strategy, goals, and budget. For instance, it is necessary to ensure that you have a proper training budget to upskill staff. Apart from that, you must also gain approval to acquire highly skilled employees if you need them. To fill these gaps effectively, there are several steps that you need to take.

Firstly, you must ensure that you retain your current talent. If your employees start leaving the company, your plan will not work. This is because these employees will take their skills with them after you have made assumptions that you have enough of those particular skills. This is why you must invest in employee retention. This also means you must learn to spot signs that an employee is planning to leave the company so you can make efforts to keep them if possible.

Apart from investing in retaining employees, you must also undertake hr succession planning for skills and roles. This means you must identify people who are likely to move higher up in the company and work out how you will fill the gap they leave.

HR planning at different levels is an important part of ensuring that an organization meets its strategic goals. Apart from that, it will also help to ensure that the existing employees are being used optimally. Once you have a good HR plan in place, you will be able to take steps to hire the right kind of people and carry out other important HR tasks like promotion, training, and development. It is important for an organization to have an effective HR plan so that it can adapt to the changes in the environment that result from competition, technology, and government policies. Without a proper HR plan, organizations will find it very difficult to adapt to these changes and to achieve their future goals.

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