ppma annual seminar 2014 - workforce planning in an uncertain future

Don’t let ‘people’ get in the way of implementing your business strategy:Strategic Workforce Planning (SWP) as part of an integrated approach to business planningPPMA Master Class – May 2014

Business performance enablement

Objectives

► To give an introduction into:

► SWP and the benefits it can deliver

► How to carry out SWP in environments that are complex and dynamic


Contents

1 The goal: Right resources to deliver – in uncertain times

2 What is Strategic Workforce Planning (SWP)?

3 Why SWP – Why now?

4 Business Planning and SWP

5 Benefits of SWP

6 Applying SWP to the challenges faced by local government

7 Q & A

8 Review and Close


Complex and dynamic business environments need a different approach to planning workforce supply and demand

Organisations frequently focus too much on a limited number of potential future states and exclude more radical options

The current business climate demands consideration of multiple options and response to sudden changes in strategic direction

Traditional ‘Manpower Planning’ struggles to deal with uncertainty and changes in strategic direction

Strategic Manpower Planning (SWP) provides the means to include analysis of the ‘improbable’ and ‘unknown’. Focusing on systematic scenario planning of multiple options to generate resource plans which can flex to external change.


Strategic Workforce Planning aligns development of the workforce to business strategy

What is workforce planning?

► SWP is a process to improve alignment of workforce and business strategies.

► SWP provides quantitative insight into opportunities to enhance productivity.

► SWP ensures risks to implementation relating to people are considered up front

Why is Strategic Workforce Planning (SWP) Important?To ensure organisations have business strategies that incorporate a quantified understanding of the global workforce

How is it different?

SWP is based on proven statistical analysis of complex data sets and the principles of Management Science.

It includes use of:► Systematic Scenario Planning► Risk analysis and Mitigation Plans► Econometrics► Statistical Analysis► Forecasting► Operational Research


Strategic Workforce Planning is a critical part of a business strategy focused on the delivery of growth and productivity

Benefits DriversCosts► Provides insight into the operating model, skills

and workforce mix that will deliver ‘Value for Money’

► Uncover hidden possibilities for reducing cost within even tighter budgetary constraints when pay is a key expense

Productivity► Understaffing / overtime avoided

Customer Satisfaction and compliance► Reducing service quality risk► Reducing compliance risk► Commissioning new services quicklyPeople► Improved employee engagement► Correct skills► Reduced hire and training costs

Business Model Change

1

Reduced staff costs2

Enhanced productivity3

Improved talent pipeline

4

Typical Scenarios:


Today workforce plans emerge as an enabler to the delivery of a business strategy based on business drivers

Culture Change management | Communication

Business strategy

Performance optimization

Business driversStrategic

review

Talent availability

Business model change

Enhanced business sustainability

Increased flexibility to respond to changing market demands

Reduced people risk exposure

Reduced people cost

Capability to capture new markets and revenues

Increased productivityDeclineMaturity

Growth

Start-up

Business plan

People plan

People and talent management initiatives

HR operating model

Enabling business

performance

through people

Strategic scenario

modelling

People strategy option

analysis

Workforce planning and productivity

management CoEs

Integrated people

programmes, policies and

plans

Bespoke analytics

(KPIs analysis)

Enabling technology

Workforce planning

Workforce productivity

analysis

1. Interrogate and influence the

business strategy

2. Develop and refresh the people strategy

3. Prepare and execute the HR plan

Business results

3 May 2023

Strategic Workforce Planning ensures a quantified understanding of supply and demand of skills fully integrated into an interactive business planning process

Work Demand

Staff Productivity &Targets

Future Workforce Supply

People Supply –

Future Workforce Requirements

Future Work Trends

Modelling & Analytics

Scenario planning, Productivity Analysis

Forecasts & ProjectionsImpact Analysis

1. Understanding the ‘As-Is’ 2. Testing options and scenarios

3. Looking at possible future needs

Demand Projections

Operating Model

Test scenarios of future demand and performance

‘As Is’ analysis of historic data, business constraints and assumptions

Evaluation of solutions and comparison of options and scenarios

People Strategy OptionsResourcing options, HR policy

change, Operating Model change


Capacity Gap / Surplus


Strategic Workforce Planning can provide value adding solutions to a range of business challenges

Business drivers Example people challenges Strategic Workforce Planning solution

Strategic review •Workforce skill set•Workforce cost base

Create board level engagement in robust strategic planning with early engagement of HR

Business model change

•Workforce planning does not deliver labour supply

•Global Location strategy

Well tested plans that increase success in implementation, boosting credibility with stakeholders and investors

Performance optimization

•Low productivity•Ineffective scheduling

Internal benchmarking to uncover hidden opportunities to reduce costs

Talent availability •Scarcity of talent •Attrition of key skills

Use of analytics to identify factors impacting supply and demand in key skills areas leading to improved talent management


SWP provides a framework to find answers to the challenges raised in the IES/PPMA Working Group Study.

RequiredWorkforce

CurrentWorkforce

Alignmen

t

Evidence

Risk Mgt

General PublicAnd Government

Current EmployeesOur Community

DEMAND• Volumes, costs, quality of

services• Positive public perception• Government support

PEOPLE SUPPLY• Skills: affordability and

availability• Work patterns• Employee expectations /

behaviours

CHANGE PLAN• Costed Talent strategy• Sourcing Strategy• Risk Mitigation

Modelling Workforce Demand – Understanding current and future needs

Workforce Demand

Benchmarks

Expert Opinion

Productivity Analysis

Outputs

Analysis

Inputs

Bringing together a range analytical tools and techniques, our approach focuses on understanding what is driving the need for resources, including ► Staff productivities across roles and

services ► Differences in planned demand across

services and how these affect productivity

► The impact of physical constraints, eg population centres and local resource requirements

► Base requirements and specific needs across services

► Demographic development and usage trends and how these will affect workforce demand through scenario modelling

Our approach brings together business strategy with historic data and scenario modelling to understand future demands

Trends in delivery of

public services

External Developments

Historic Data on Service Delivery

Business Strategy

Operating Model

Forecasts of demand for services

Structural Constraints

Requirements & Working

Regulation


Modelling People Supply – Understanding staff developments and efficiencies

People Supply

Outputs

Analysis

Inputs

Projections

Data Analysis

Our approach enables an understanding of the key drivers of staff behaviours and forecasts staff and skill availability

Analysing staff behaviours and developments to develop a projection of staff and skill availability in the future, including► Attrition rates and trends across age

groups, locations and departments► Shifts, working regulations, current

practises and collective agreements► Key skills and skill mix including the need

for specialists► Tenure and typical career progression of

staff, implications of extended absence due to training

► Teams and collaborative working across departments and services

Staff

TenureAttritionLeave, trainingRoles &

Specialities and skills

Working regulation



Example: SWP in Commissioning within Health and Social Care

This demands a “pressure tested” workforce strategy and people plan aligned with the business strategy:

►What operating model, skills, workforce and location mix will provide the best value for money and still meet health and social care standards?

►Where do the people risks lie in placing those bets?

►Where do the threats to your organisation lie as you have to deliver under increasing budgetary pressures?

The public spotlight is on health and social care providers:

►To provide high quality Health and Social Care under increasing stress of demographic changes, an ageing population and a divergence between where services could be delivered and where they are being delivered.

►To make sure that the organisations meet Health and Social care standards in the face of major quality concerns and ensuring the workforce is well trained.

►To save costs and deliver within ever tighter budgetary constraints when pay is the main expense

Modelling of workforce demand Understanding current and future Care needs

Workforce Demand

Benchmarks(NMDS)

Expert Opinion

Productivity Analysis

Outputs

Analysis

Inputs

Bringing together a range analytical tools and techniques, our approach focuses on understanding what is driving the need for resources, including: ► The impact of demographics on health

and social care demand► Priorities from local people

(commissioning effectively)► The impact of physical constraints, eg

beds or locations, ► Impact of compliance regulation

Our approach brings together your business strategy with historic data and scenario modelling to understand your future demand and operations

Priorities from local people

Requirements & Regulation

Provider landscapeDemographics

Health and Social Care requirements

Structural Constraints such as beds, location


Modelling of People Supply Understanding staff developments and supply

People Supply

Outputs

Analysis

Inputs

Projections

Data Analysis

Our approach enables an understanding of the key drivers of staff behaviours and forecasts staff and skill availability

Analysing staff behaviours and developments to develop a projection of staff and skill availability in the future, including► Attrition rates and trends across age

groups, locations and specialties► Shifts working regulation and current

practises► Key skills and skill mix across

specialties, e.g. care workers► Tenure and typical career progression of

staff, implications of extended absence due to training

► Health and Social care regulation

Staff

TenureAttritionLeave, trainingCapability and

skills requirements

Health and Social care regulation


The Steps to Embed Strategic Workforce Planning


Business Strategy

WorkforceStrategy

People Plan

2. Analyse Drivers

3. Evaluate Strategic Impact

5. Evaluate Delivery Options

4. Develop HR

Initiatives

6. Implement

7. Measure and

Feedback Results

► Use the existing business strategy to deliver steps 1 -3.

► In parallel, develop People Plan (4,5) and share Workforce Strategy with Key Stakeholders

► Implement plan, measure effectiveness and feedback outcomes (6,7).

► Ensure feedback influences the next iteration of the business strategy.

Feedback costs, risks and constraints

Work Demand

Staff Productivity &Targets

Future Workforce Supply

People Supply –

Future Workforce Requirements

Future Work Trends

Modelling & Analytics

Scenario planning,ProductivityAnalysis

Forecasts & ProjectionsImpact Analysis

1. Understanding the ‘As-Is’ 2. Testing options and scenarios

3. Looking at possible future needs

Demand Projections

Operating Model

Test scenarios of future demand and performance

‘As Is’ analysis of historic data, business constraints and assumptions

Evaluation of solutions and comparison of options and scenarios

People Strategy OptionsResourcing options, HR policy

change, Operating Model change Capacity Gap / Surplus

1. Gather Data

Create

an id

entifi

ed

busin

ess d

eman

d

3 May 2023

Example of how SWP can be used to develop answers and support employee dialogue to gain ‘buy – in’ …

Scenario modelling allows you to see future risks and

opportunities

17

Test the impact of different future scenarios and

people plans on requirements and costs

Analysis and reports providing stakeholders all the evidence required for informed decision making

Create highly visual planning sessions

where issues can be identified quickly

1

2

3

4


… and enables clearer decisions and improved

► Increasing workforce efficiency by providing the workforce with the right skills at the right costs

► Improved productivity through improved prioritisation of tasks and resource usage

► New insights into shift planning and rostering► Accurate financial information for budgeting and costing

Model Output Benefits

Workforce requirements► Staff requirements for each speciality by roles, skills

set and location over time► Staffing gaps and surpluses across the organisation► Projections of future demand and requirements in

alternative scenarios► Current and future projections of total staff costs to

the organisation across functions

► Improved productivity by closing capacity gaps and reducing surpluses

► Improved control and visibility through consistent consolidated information enabling continuous improvement

► Identification of best practise across the organisation

► Improved understanding of staff availability developments to inform recruitment decisions

► Identification of problems with talent management, diversity, absence or retention strategies

► New insights in succession planning and improved trainings planning

Productivity metrics► Productivity KPIs for each organisational speciality

and key roles► Internal benchmarking and ranking of productivity for

comparable services

Workforce dynamics► Forecast of staff and role distribution across

speciality / role over time without intervention► Staffing projections accounting for retention changes► Staff absence and issue reports



Q and A

?

ppma annual seminar 2014 - workforce planning in an uncertain future

Leadership & Management