Core Workforce Planning Practices to Identify Near-term Headcount Needs.

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Wowledge Expert Team
Principal level
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This guide is part of a progression set comprised of Core, Advanced, and Emerging Workforce Planning practices.

What it is

Core workforce planning is a business-aligned process that identifies and describes the current level of employee headcount, assesses future needs based on both internal strategies and external trends, and generates an employee replacement analysis. It takes into consideration current external economic, industry, and workforce developments to assess potential supply requirements, internal business strategy directions, and employee turnover tendencies to examine internal demand requirements.

It leverages a set of standard employee loss and sentiment metrics to create an evaluation of the likelihood of replacement requirements and leads to a headcount planning exercise where talent management processes are engaged well in advance of the losses for replacement strategies and plans. 

Another related term for this is known as "headcount planning", which is typically a Finance function-driven exercise that serves to understand the costs vs. budgets for employees. It can leverage the use of "full-time equivalents", or FTEs, which are estimates of the productive and unproductive time on the job. It often includes a calculated reduction for each full-time employee's planned absence time (vacation days, sick days, family leave, required training, etc.) so that a regular, full-time employee is actually less than 100% productive. For the purposes of workforce planning, a full-time employee is calculated at 100% so that staffing, replacement, and training needs can be calculated for the number of unique individuals at any given point in time.

Why use it

Core workforce planning practices enable better preparation and advance notice of headcount losses for the coming year in a way that improves the organization's ability to meet product and service output demands. With improved foresight, functional managers and HR teams bring a more continuous flow of hiring and employee capability development into play, with the aim of minimizing gaps in the volume of employees needed to productively meet the company's business plans and production requirements.  

It enables the organization to better manage its support workflows and costs (recruitment, onboarding, training, etc.) with improved insights into how many and when headcount will be needed. It also helps focus functional managers' attention on the criticality of retaining the talent they have and the continuous building of skills that is necessary for an organization to "win" in the labor market today. 

Practice guides at this level

Generating alignment between workforce planning and business strategies.

Creating business alignment of the workforce planning effort requires both a review of the company's strategic direction and targeted discussions with leadership regarding key changes.

Identifying and calculating the internal supply of available talent.

Understanding the current state of talent available and deployed across the enterprise informs the internal "supply" side of the supply vs. demand analysis that will ultimately be conducted.  

Projecting future headcount demand requirements from business plans and external estimates.

Incorporating workforce changes to be considered by reviewing the external environment for trends that may impact the company's ability to retain and maintain sufficient staff.

Closing the projected headcount gaps through talent management strategies.

Developing plans to close headcount gaps through acquiring or developing the talent needed to fulfill business goals and objectives. 

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