- 4 mins
- Article

- Running a business
- Improve Efficiency
What is workforce planning?
Workforce planning is an important element of your overall business planning strategy that ensures you have the right balance of personnel, capabilities and talent needed to meet the evolving needs of your business. It requires developing an understanding of the wider business market, what roles are currently in demand and which roles will be essential in the future. By developing a robust workforce plan you will be able to strike the right balance between hiring new talent and upskilling existing workers.
Why is workforce planning important?
Workforce planning is an important element of your overall business planning strategy that ensures you have the right balance of personnel, capabilities and talent needed to meet the evolving needs of your business.
It requires developing an understanding of the wider business market, what roles are currently in demand and which roles will be essential in the future. By developing a robust workforce plan you will be able to strike the right balance between hiring new talent and upskilling existing workers.
Why is workforce planning important?

Workforce planning meeting
Human resources are an essential component of business success in today’s complex and fast-moving environment, providing an important source of competitive advantage. By analysing the makeup of your workforce and predicting evolving workforce supply and demand challenges, effective workforce planning can help drive operational efficiency and grow your business.
Developments such as digital and technological transformation and shifting labour markets highlight the need to enhance and diversify the skills mix within your organisation and strengthen your employee acquisition and retention processes.
How can workforce planning address skill gaps?
Workforce planning helps you understand the existing capabilities you have within your organisation and identify skills gaps that need addressing. This can help you build a plan for training existing employees, sourcing relevant talent and redeploying resources to address any imbalances across your workforce.
What are the advantages of workforce planning?
Workforce planning has many potential advantages:
• Helping you hire and train people with the skills needed to advance your business goals
• Optimising the costs of recruitment by reducing turnover and enhancing talent management
• Addressing skills gaps and ensuring your teams are properly staffed
• Enhancing the operational needs of your organisation and boosting agility
What are the different types of workforce planning?
There are two important forms of workforce planning: strategic workforce planning, which takes a long-term approach to anticipating evolving workforce needs; and operational workforce planning, which aims to align your operational needs with your overarching business strategy.
Strategic workforce planning
As the strategic objectives of your business evolve over time, different skill sets and capabilities are required to deliver sustainable growth. Strategic workforce planning helps you identify the training and development needs of existing employees as well as hire new talent to support your long-term goals.
Operational workforce planning
Operational workforce planning focusses on aligning your short-term operational goals with your talent capabilities to attract, retain and deploy resources to meet immediate business priorities. This requires streamlining the allocation of resources across your business while boosting productivity and adapting to evolving market demands without neglecting your long-term objectives.
What are the principles of workforce planning?
Here are five key principles that may support effective workforce planning strategies.
- Understanding the current makeup of your workforce and the skills and knowledge within your business, and what changes are needed to achieve your strategic goals.
- Developing insights into supply and demand trends in the wider business environment and developing your plans accordingly.
- Using scenario planning to help you understand how a range of different future operating environments might impact your workforce needs.
- Using gap analysis to understand which skills and capabilities need procuring to meet your commercial goals.
- Creating an action plan for implementing your workforce planning strategy that can adapt to the shifting demands of your industry.
Steps to implementing workforce planning
- Strategic planning
Creating a strategic plan for aligning your workforce strategy with your business objectives. This requires setting key performance indicators (KPIs) to track progress and setting targets for enhancing your talent base, filling recruitment gaps, improving retention and support succession planning. - Assessing workforce supply and demand
Understanding the current talent profile within your business by breaking down who is working for you and their current level of skills and training. You may need to recruit or develop more senior staff, redeploy talent to other areas of your business or improve your recruitment practices. - Identifying skill gaps using gap analysis
Gap analysis is a powerful tool for identifying skills and capabilities that are missing from your organisation and creating priorities for meeting workforce demand. Perhaps you require more executive-level talent to implement operational change or need to boost recruitment among other specialists. - Anticipating future needs with demand analysis
Demand analysis helps you understand your current and future workforce requirements based on a range of factors such as product development, consumer trends and changing labour markets. It helps you understand how your employee headcount needs to adapt over time, the talent you need to acquire on both a short and long-term basis, and the priorities of management teams. - Strategic implementation
Once you have a detailed understanding of your existing capabilities and areas for improvement it is important to outline the steps required to address your workforce needs according to your strategic priorities. This may involve adjusting your reward and incentives processes, enhancing renumeration packages, or overhauling training and development processes. - Analysing outcomes and refining strategies
Setting KPIs will help you accurately measure the results of your workforce planning process. This requires analysing workforce data, refining reporting processes and adjusting your business strategy to meet your commercial objectives. It is also important to establish processes for reporting to senior teams to ensure stakeholder alignment.
Are there tools to help with workforce planning?
There are a wide range of workforce planning tools which can help support your workforce planning efforts. Many businesses use workforce planning software to help them collect and analyse HR data, model the demographic and talent profiles of their people, forecast supply and demand challenges, engage in scenario planning and create customisable performance reports to keep senior decision-makers informed.
Workforce management tools can help leaders understand what their teams are working on, how they are performing, and track metrics such as productivity and revenue-per-employee. AI-powered forecasting tools can help project the staffing levels required to meet future workforce needs while streamlining recruitment processes.


How do you measure the success of workforce planning efforts?
To measure the success of your workforce planning strategies it is important to monitor the outcomes of the KPIs you established at the planning stage. Here are some key metrics to consider:
Time-to-fill
A measure of how long it takes to fill key roles once they become vacant. Reduced time-to-fill metrics indicate effective recruitment processes and are important for efficient resource management.
Cost per hire
Recruiting new staff can be expensive and high levels of cost per hire might require a review of your recruitment processes.
Retention rates
Keeping hold of valuable employees not only ensures your business can maintain continuity of service but also maximises revenue-generation potential and supports a positive workplace culture.
Employee performance and development
Ensuring your employees are productive and developing their skills helps you meet the evolving needs of your business in a competitive commercial landscape.