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An Essential Guide to HR Planning

by | Mar 21, 2024 | HR Planning | 0 comments

2024 is a big year for HR. According to the Academy to Innovate HR “2024 stands as a transformative year for HR, where its influence will extend beyond the traditional scope of the function”.

With all of the technology, tools, and data at HR’s disposal, this year presents itself as an opportunity for HR teams to demonstrate their impact as strategic players in a business’s trajectory. 

How can they do this? Through HR planning.  Think of HR planning like a compass, guiding you through the complexities of strategically managing your company’s most valuable investment– your people. So, let’s delve into:

  • What is HR planning
  • Why it’s important
  • How it can transform your organization’s approach to talent acquisition and overall business success

What is HR Planning?

HR planning aligns your organization’s people plans with its long-term goals. This calls for identifying current and future workforce needs to achieve overall business objectives, while considering the challenges and opportunities of the shifting marketplace.

HR planning spans the entire employee lifecycle. It  impacts everyone from the top to bottom of your organization, even though most of them might not have much direct interaction with HR after their initial onboarding. On a recent panel at Transform 2024 Amy Bouque, Chief People Office at Kelly, pointed out that with around 75% of a company’s investment (aka: its people) sitting with HR, there is a huge opportunity (as well as a huge responsibility) for HR teams to make an impact in small, sometimes invisible, ways.

The Pillars of HR Planning

HR planning is a multi-dimensional process, covering elements such as:

  • Recruitment
  • Retention
  • L&D
  • Succession planning
  • Compliance

It’s about looking ahead, preparing for workforce changes, and ensuring the business remains competitive and compliant.

Oftentimes businesses approach HR planning either too formulaically or too reactively. When in fact, HR planning is as critical as product roadmaps for R&D teams or budgets for Finance – it provides a guide for stakeholders to follow and be held accountable to and ensures that all HR programs and processes tie back to an overarching goal and strategy. 

Why is this? Because HR goes beyond filling vacancies. It extends to the intentional development of a healthy and productive workplace environment, alive with growth, innovation, and employee satisfaction.

And there are several ways strategic planning helps achieve these goals. 

The Advantages of Strategic HR Planning

Here’s just a snapshot of what your organization can expect to benefit from when buying into HR planning:

  • Proactivity, not Reactivity – HR planning equips you to anticipate changes rather than scrambling to react. As a result, it arms you to confidently pre-empt and overcome challenges, such as uncovering employee turnover trends and launching intentional initiatives to improve retention of top talent. 
  • Time and Money Savings – Imaging allocating resources more efficiently and avoiding unnecessary expenditure, thanks to forecasting needs, gaps, and bottlenecks. Now you can. 
  • Attracting and Retaining Talent – Strategic HR planning is your not-so-secret weapon in the fierce battle for top talent. It supports and dictates the creation of an environment that attracts the brightest minds and encourages them to stay. In turn, this contributes to your organization’s ongoing success and advancement. 
  • Compliance and Risk Management – HR planning is key to keeping on top of ever-changing shifts in the regulatory landscape. Avoid the minefields of non-compliance by staying ahead of it.

Challenges and Considerations of HR Planning

The benefits of HR planning are clear. But there are potential pitfalls to keep in mind.

For example, lack of commitment, either from HR stakeholders or leadership, can negate potential effectiveness.

Moreover, a lack of flexibility is detrimental,  as the rapid pace of business environments demands agile HR planning that can swiftly adapt to changing dynamics. This is why success depends on the following factors:

  • Adaptability
  • Agility
  • Ongoing engagement with emerging trends and technologies

And of course, thinking about HR planning is one thing. Implementing it can be another thing completely!

Planning A Roadmap to Success

Ever feel like HR planning is a guessing game?

The journey begins with assessing your current situation and forecasting the future to identify gaps. Plus, technology plays a crucial role, which means leveraging data to inform and refine your planning efforts.

Then, it’s about developing a strategic roadmap, complete with timelines and budgets, spanning your current state and future goals.

And let’s never forget you can’t improve what you can’t or don’t measure. To this end, continuous tracking and adjustments ensure your organization stays on track and responsive to new developments.

Try following these steps for HR planning like a pro in no time:

  • Step 1: Taking Stock of Your Talent – Inventory your current talent pool, including key skills like communication, tech-savviness, problem-solving and experience levels. You might choose to tackle this department by department for ultimate clarity, enabling you to pick out the specific skills each team thrives on. 
  • Step 2: Forecasting Future Talent Needs – You need to understand your company’s business goals if you’re going to predict future talent needs. What does each department need to achieve these goals? How many team members and what skill sets will it take to make it happen? 
  • Step 3: Identifying the Gaps – Now, compare your current people situation to your forecasted needs. What are the urgent priorities vs. longer-term needs? Are there any gaps to fill? For example, launching a new product might mean expanding your sales or marketing teams. 
  • Step 4: Developing Talent Strategies Beyond Hiring – You’re prepped and ready for killer HR planning once you know where you are and what you need. Your plan might typically cover areas such as: 
  • Targeted Recruitment: Attracting top talent with the right skill sets
  • Leveling Up Your Crew: Investing in training your current employees in key areas to support your upcoming initiatives
  • Going Hard on Retention: Keeping your rockstars happy and motivated in an engaging company culture 
  • Step 5: Tracking Your Progress – It’s essential to measure the effectiveness of your HR plan, and there are various ways to do this, such as: 
  • Monitoring key HR metrics relevant to your plan, and how they trend over time
  • Tracking how each department or team is performing on assigned tasks, to gauge if additional HR support is needed

Core Components of a HR Plan

The more unique your HR plan is to your company’s goals the better. That said, some universal components should be included, no matter who or what your business is:

  • Workforce Analysis and Forecasting – Identify your in-house talent and pinpoint what and/or who else you might need. Think of it as scouting for potential recruits both internally and externally. 
  • Talent Acquisition – Fine-tune your hiring process to attract top talent, while keeping recruitment costs down 
  • Skills Gap Analysis and L&D – Identify training needs and devise a plan to empower your workforce. 
  • Leadership Development and Succession Planning – Ensure strong leadership, with a backup plan in case of unforeseen circumstances. 

Ok, you’ve knocked HR planning out of the ballpark – or so you think. But what do you need to measure it? More to the point, how do you measure what you need to measure?

Benchmarking Your Success

It’s especially valuable to track the following types of KPIs, (depending on the specifics of your HR plan):

  • Recruitment – Track new hires by month or quarter to monitor your hiring progress.  
  • Retention – Monitor your turnover rate, holistically and by function and demographic. This empowers you to respond fast to any gaps threatening to derail your business goals. 
  • Turnover Analysis – Use exit interviews and survey data to identify areas for improvement and even immediate concern in employee engagement and retention. 
  • Employee Net Promoter Score – Measure employee satisfaction to predict turnover and commitment levels to the company.

Your HR software should make key HR metrics a walk in the park, readying you to write real success stories bearing on the organization’s future direction.

Igniting HR Planning with the Right Tools

Superior HR planning isn’t just about strategies but the tools bringing those strategies to life. Whether you’re managing compensation or analyzing retention, technology helps you make informed decisions, track progress, and adjust plans.

As you may well know, it can be extremely time consuming and complicated to try and extract data from your HCM or HRIS, ATS, payroll system, etc. In order to get the insights you need for HR planning. You need the right tools to turn your disparate data sets into actionable insights, providing the numerical evidence you need to support your HR planning and recommendations.

For example, a leading people analytics software solution like PeopleInsight by HireRoad greatly enhances HR planning across key outcomes. This simplified software enables you to make informed decisions based on workforce insights across multiple areas of your HR organization, ultimately contributing to the organization’s overall success.

The Strategic Imperative of HR Planning

HR planning is the way forward for shaping the workplaces of the future, where success is driven by a potent combination of innovation, efficiency, and employee satisfaction.

The Academy to Innovate HR concludes, “While the challenge is vast, the potential rewards for organizations, workers, and broader society are immeasurable.”

“The blend of innovation and strategic thinking that HR brings to the table will drive growth, inclusivity, and resilience. In taking up this expanded role, HR will guide organizations to new heights of excellence. 2024 presents a world of opportunity; it’s time for HR to rise and shine in this new era of work.”

 

At HireRoad, our premier PeopleInsight people analytics software system is your perfect partner for navigating HR planning. By leveraging unprecedented insights, it’s easier than you think to wrangle the complexities of your workforce, seize growth opportunities, and build a resilient, dynamic, and engaged team ready to tackle tomorrow’s challenges.

If you’re ready for transformational data-driven HR planning,  book yourself a free demo of PeopleInsight by HireRoad and start seeing value in just 5 days.