The 10 Biggest Benefits of Strategic Workforce Planning

Have you ever left a company meeting excited about a new set of projects and priorities, yet concerned that your team doesn’t have the skill sets or capacity to execute? This common situation can be frustrating.

The good news? The chance of a mismatch between to-dos and resources can be minimized or eliminated by investing in strategic workforce planning. Strategic workforce planning, simply put, means that an organization has closely aligned its people strategy with its business strategy.

Attracting and retaining talent is a priority and concern for CEOs in 2024, with 31% saying it's difficult to find qualified workers. Effective strategic workforce planning ensures a company can be proactive in finding quality candidates, closely matching candidates with need.

The model ensures the right people with the right skills are in the right roles at the right time to successfully complete priority objectives. Consider the top 10 benefits of strategic workforce planning:

• Improved alignment of human resources with business goals
• Enhanced talent acquisition
• Better risk management
• Increased operational efficiency
• Cost management
• Greater agility in response to market changes
• Improved employee retention
• Succession planning and leadership development
• Enhanced regulatory compliance
• Long-term sustainability and growth
  

By applying sound strategic workforce planning strategies and fully leveraging the tools available to you, you’ll reap the benefits within your organization.

1. Improved alignment of human resources with business goals

Work innovator companies wishing to apply workforce transformation models that utilize freelance talent as a core part of their strategies must place human resources (HR) at the center of their efforts. A majority of CEOs (70%) expect their chief human resources officer (CHRO) to step into this key role, with only 55% saying their CHRO meets this expectation. One benefit of strategic workforce planning is that, in this model, HR is handed the method and the tools to align early and often with organizational business objectives to ensure every decision supports the broader business agenda.

Smooth coordination between HR and broader strategic initiatives means that HR is included when executive-level decisions are made. HR then offers input and builds talent plans and strategies to support and facilitate execution of the projects and outcomes. As a new set of projects and priorities are communicated, for example, the talent plan that accompanies it is also communicated.

This is what happened at Chargebee when it adopted this talent sourcing model during a period of unprecedented growth. The HR department at Chargebee, a software as a service (SaaS) platform, met with every department, assessed the talent that was needed, and quickly procured it through Upwork’s talent marketplace.

2. Enhanced talent acquisition

The pool of talent your company needs for a particular project or time period often varies. This is why it’s important to think about talent acquisition rather than talent recruitment. Talent acquisition focuses on strategic workforce planning. Talent recruitment focuses on filling immediate job openings.

A benefit of strategic workforce planning is that you may use data to anticipate your hiring needs and tailor hiring strategies for that time period. Workforce analytics help identify the current state of play for your business—the skills and abilities available within your existing talent roster—as well as gaps in talent.

From here, you can predict the type of talent you’ll need and when. You can also identify if there are gaps or mismatches that need to be rectified.You may then restructure and redistribute talent at a later time to fit your changing needs.

Let’s look at an example of how this could work. Your company may be focusing on a software product to be launched in Q3 and need UX/UI (user experience and user interface) design support to achieve the outcome. Once the product is launched, the UX/UI talent could then be reapplied to meet new objectives. Next, you may need a different pool of talent to market the product and begin to work with a group of marketers who have come to you fresh off other projects.

3. Better risk management

Having the right talent on hand to get the job done reduces risk for your organization: risk of falling behind on achieving strategic goals, risk of exhausting the existing team, and ultimately, risk of losing revenue, competitive momentum, and clients.

The benefit of strategic workforce planning is that you can mitigate these risks by proactively addressing potential challenges before they become critical issues. Forecasting and planning using strategic workforce planning tools can mitigate risks such as:

• Talent shortages
• Skills gaps
• Related financial contingencies

4. Increased operational efficiency

Aligning workforce capabilities and business needs leads to more efficient operations and resource allocation. Strategic workforce planning helps you analyze, anticipate, and plan for change. Workforce planning tools can help you with:

• Time tracking
• Attendance management
• Scheduling
• Labor forecasting and planning
• Compliance management
• Cost controls
• Resource allocation
• Payroll and benefits

Use automation whenever possible. Examples of standardized processes to develop to navigate the varying staff levels and workflows include:

• Time-off processes and protocols
• Time clock reports, access, and sharing
• Benefits portal updates
• Worker data input, storage, and protection

Train managers and talent, when applicable, so they can use the tools. These tracking tools will provide data that shows what’s working and what’s not to increase operational efficiency.

5. Cost management

Strategic workforce planning helps people managers create accurate budgets and significantly reduce cost by hiring the correct number of people needed at any given time. Tracking your talent staffing needs with accuracy prevents costly overstaffing and understaffing. On-demand talent models are a great example of how to scale your team up and down affordably.

This is how a small internal production team at Microsoft managed cost when it found itself understaffed for a hot minute. A request came in for the team to produce nine videos in 10 days, a pace well beyond their bandwidth at the time.

Rather than scramble to hire new team members, they rethought their process, creating cost savings and efficiencies by hiring on-demand video production talent. Now, this is their go-to model and they’ve received recognition within their company for responding innovatively to a talent shortage issue.

Strategic workforce planning also helps budget managers identify and assess how people are doing in their roles—essentially, not just hiring the correct number of people, but hiring people for roles in which they can excel. Strategic workforce planning tools can help track:

• Time and cost to hire
• Individual performance
• Employee engagement
• Efficiency
• Productivity

6. Greater agility in response to market changes

Companies need to maintain agile talent models to respond to market changes. A well-planned and executed workforce strategy gives organizations the flexibility to quickly adapt to market opportunities.

Agile talent solutions are the reason some companies are gaining a competitive edge by capitalizing on developments in artificial intelligence (AI), for example. While it would be difficult to upskill in-house tech experts, a team leveraging the strategic workforce planning model would be leading, not chasing, the potential of new technology with a plan to hire talent skilled in AI.

When the BISSELL Pet Foundation found itself needing to find localized talent during a period of high demand, it adapted its workforce strategy by seeking out the talent it needed on Upwork. The experience was so successful, the organization built a virtual bench of on-demand talent to source from.

With a strategic workforce planning model, an organization can anticipate change, respond nimbly, and prepare for the future.

7. Improved employee retention

Strategic workforce planning is a tool HR and hiring managers can use to support and retain employees. The top three reasons employees leave an organization are due to:

• Lack of career growth (37%)
• Low pay or overall compensation (28%)
• Feeling undervalued (27%)

Strategic workforce planning offers an elevated level of insight to help managers automate raises, bonuses, and promotions. Managers may also leverage analytics to identify top performers and predict those at risk of leaving.

Managers may develop and implement a retention strategy when needed to reduce employee turnover. Retention strategies can include salary incentives, a change in role, and opportunities to upskill.

8. Succession planning and leadership development

The retirement of the baby boomer generation, along with talent gaps that resulted from pandemic-related worker fatigue, has led to talent pipeline vulnerability. (Think the great resignation that occurred in 2021 and 2022, redefinition of the workforce, and a decreased interest in working for organizations that fail to offer a remote work option).

Strategic workforce planning can rebuild talent pipelines by identifying existing gaps in talent as well as predicting future gaps. It can also identify potential leaders—people who are excelling in their roles—to support development of leadership pipelines.

Effective succession planning and leadership development will ensure continuity in key positions. Consider these actions:

• Identify key roles that are important for the growth of the business
• Invest in training and development for employees who deliver the highest ROI for the business
• Outline areas where additional resources are needed to achieve optimum outcomes

9. Enhanced regulatory compliance

Strategic workforce planning and workforce planning management systems help organizations comply with labor laws and legal regulations. Management systems can ensure employee compliance—including with internal policies—by monitoring hours worked, breaks taken, and overtime.

Capabilities of strategic workforce planning tools that help with regulatory compliance include:

• Real-time compliance monitoring
• Automated time tracking
• Data collection and analysis

Get help knowing and complying with mandatory training and licensing requirements for certain roles. Know how to monitor and comply with employee contract compliance standards. Be prepared for contingent staffing arrangements in situations like leaves of absence, sudden departures or company growth periods.

For example, in the medical field, hospitals and outpatient clinics may need to have cross-trained nurses and a plan of action for specialized areas of care in the event of an absence. A school system may be required to maintain a specific student-teacher ratio, or a factory may be required to keep a minimum level of workers staffed during hours of operation.

The overarching idea is that strategic workforce planning incorporates both organizational needs as well as awareness of and compliance with any industry or local regulatory mandates around staffing levels, credentials, skills and more. This alignment ensures ongoing regulatory obligations are met.

10. Long-term sustainability and growth

A solid talent strategy is a core ingredient for long-term sustainability and growth. Integrating strategic workforce planning with business strategies ensures you have the necessary talent resources available to support organizational growth, strategic advantage, innovation, and sustainability.

Evolve your workforce to align with your stage of business growth by using strategic workforce planning. Keep an eye on the near term, and the long term. Assess which roles are important for the growth of the business over time. Invest in worker training and development. Take steps to protect them, create engagement, and minimize the risk of attrition.

Plan your workforce strategy with Upwork

Thanks to strategic workforce planning, you no longer need to worry about having the right talent with the right skills to execute on important company initiatives. Organizations with closely aligned talent and business strategies work swiftly and efficiently to achieve success while limiting risk and decreasing cost.

Many organizations come to Upwork to find support for their strategic workforce planning programs. Their reasons are simple: Upwork provides swift access to qualified people who can execute on their organizational objectives.  

Upwork makes it easy to sign up and find the talent you seek. Use the Job Post Generator powered by Uma, Upwork’s Mindful AI to submit a proposal. New clients who use the Job Post Generator post jobs 80% faster than clients who don’t. And the process is simple. Just describe what you’re looking for in a sentence or two and the Job Post Generator will create your draft job post.

Customize your post with job-specific details that help attract expert talent. Make your post your own by utilizing AI-generated customizations, such as giving it a more casual or formal tone.

Upwork is here to partner with your organization to support your strategic workforce planning needs. Learn more about Upwork and get started today.