Talent Planning: Essentials Guide With Strategies

Talent Planning: Essentials Guide With Strategies

Given today’s competitive hiring market and evolving in-demand skills, retaining and developing your existing team members can be much more efficient and cost-effective than recruiting external workers. Strategic talent planning can help your organization keep top performing workers engaged and support a culture of ongoing learning and development.

Talent planning is an ongoing, iterative process. In this guide, learn about what talent planning is, key benefits and components, effective talent planning strategies, and how to overcome common challenges.  

If your organization needs to immediately create a formal talent planning strategy or update an existing plan, skilled independent talent management professionals are available on Upwork to help. Experienced professionals can share their talent planning expertise to help you effectively retain and develop talent.

Table of contents:

What is talent planning?

Talent planning is a strategic process that focuses on developing and retaining existing workers at an organization to align with skills needs and drive business outcomes. Unlike recruiting, which involves identifying and attracting external talent for immediate business needs, talent planning places an emphasis on building long-term relationships with internal team members and offering high performers advancement opportunities.

The terms talent planning and workforce planning are often used interchangeably. While they share similarities, they also have some differences. While talent planning focuses primarily on internal workers, workforce planning analyzes an organization’s entire workforce, including both current employees and external talent sources. The goal of workforce planning is to ensure the organization has the right mix of skills, competencies, and resources to achieve strategic business goals. The key components of talent planning are essential to effective workforce planning.

Importance of talent planning

When implemented effectively and with broader business objectives in mind, talent planning offers a range of advantages to businesses.

Benefits of talent planning include:

  • Performance optimization. By evaluating performance and skills gaps and providing targeted talent development opportunities to team members, talent planning can improve individual and organizational performance and productivity.
  • Improved employee engagement and retention. Part of the talent planning process focuses on identifying development and advancement opportunities for existing team members. Offering current workers opportunities to build new skills and grow in their careers can drive improved engagement and retention.
  • Increased workforce agility. Talent planning enables organizations to build agile and adaptable workforces and quickly respond to changing market conditions, in-demand skills, technological advancements, and industry trends. As a result, this can foster a culture of innovation and drive competitive advantage.
  • Cost savings. The costs associated with recruiting, onboarding, and training new employees can be significant. Effective talent planning helps minimize these costs by focusing on recruiting talent with the right skills and proactively developing internal talent for future needs.

Key components

Comprehensive talent planning includes several HR and talent management strategies to support the retention and development of existing talent to align with critical business goals.

Talent needs assessment

Fully understanding your talent needs can help ensure you have the right team members in the right roles with the right skills. Focusing on both your current and future talent needs is important as in-demand skills continue to evolve. According to an edX survey of 800 executives and 800 knowledge workers, the executives surveyed feel 47% of their workforce is unprepared for the future of work.

As you assess your talent needs, consider the following questions:

  • What are your organization’s short- and long-term business objectives?
  • Which soft and hard skills does your organization need to achieve key business outcomes?
  • Do your organizational chart and existing workforce align with your current talent needs?
  • How may your talent needs and necessary skills evolve as your business scales, adds new offerings, or incorporates new technology?
  • Does your organization complete regular talent reviews to measure workers’ skills and potential?
  • How can you develop existing talent to learn new skills and transition internally as business needs shift?
  • Which talent development resources do you currently have available and how can you improve internal training opportunities?
  • Do you have a formal succession planning strategy in place to backfill roles when workers leave or transition internally?
  • What’s your process for recruiting external workers when skills needs can’t be met by existing team members?
  • Can certain skills gaps be filled by remote or independent talent?
  • What’s currently going well with your recruiting and talent acquisition strategy and what can be improved?

Talent development

Talent development is the process of developing existing team members’ skills and competencies. Proactive, ongoing talent development strategies can help team members develop new skills that align with shifting business priorities and evolving in-demand skills.

No two individuals have the exact same learning style, so offering a diverse set of talent development resources is important. Some examples include:

  • Structured, standardized onboarding for new hires
  • Online learning sites, such as Skillshare, MasterClass, and General Assembly
  • Skill and talent assessments
  • Tuition reimbursements for relevant certifications, degrees, and upskilling courses
  • Stipends for training, professional development events, and educational resources including books or media subscriptions
  • Stretch assignments and experiential learning
  • Job rotation or shadowing programs to learn more about other roles and departments
  • Scheduled or blocked time during the work day to focus on development initiatives
  • Department or company-wide training sessions
  • Peer learning groups
  • Mentoring and coaching

Performance management

In addition to encouraging team members to build skills through talent development, performance management is a more formal process focused on setting expectations for workers and aligning individual goals, competencies, and accomplishments with organizational objectives.

The cadence for formal employee performance reviews varies by organization. While some organizations conduct reviews annually, in today’s ever-evolving business landscape, checking in on individuals’ performance more frequently can be beneficial. However, a Workhuman survey of 1,000 full-time U.S. workers found that only 38% of respondents said their companies conduct performance evaluations quarterly or monthly.

Some best practices for effective performance management and reviews include:

  • Develop standardized performance review templates to evaluate all team members on a consistent, objective scale
  • Ask workers to complete self-evaluation forms
  • Schedule training sessions to brief managers on how to write employee evaluations and conduct performance review conversations
  • Leverage performance management software to centralize worker evaluation forms and discover performance trends across teams and the broader organization
  • Encourage workers and managers to collaboratively identify SMART goals (goals that are specific, measurable, attainable, relevant, and timebound) to achieve before the next performance review cycle
  • Align goals and performance feedback to business requirements and goals
  • Promote high-potential workers or offer stretch assignments and additional opportunities
  • Create tailored development and performance improvement plans for individuals who fall short of performance goals and expectations

Succession planning

Succession planning is an important talent management process that maps critical roles and skill sets, identifies a list of successors to take on key positions when workers transition out of the team, and develops potential successors to ensure they have the right skills. Organizations should take a proactive approach to developing succession plans so they can quickly backfill roles, whether a team member leaves the organization or transitions to a new role entirely.

Successful succession planning focuses on both supporting workers so they can advance in their careers and ensuring the organization prevents lost productivity when a team member leaves their role.

To effectively plan for succession, identify a list of critical roles within your organization and outline the following details for each role:

  • Job title
  • Team member name
  • Turnover risk for the existing team member in the role
  • Job description or a general overview of responsibilities
  • List of required skills to succeed in the role
  • Team members and direct reports (if applicable)
  • Shortlist of potential internal successors
  • Readiness score for each potential successor
  • Talent development and training options and timeline to improve each individual’s readiness score

Talent acquisition

While talent planning prioritizes driving engagement and development among existing talent, when critical skills gaps can’t be filled by your existing workforce, effective talent acquisition is essential to attracting external candidates. Talent acquisition is a proactive, strategic process of identifying and engaging external talent with the necessary skills to meet both current and long-term business goals.

Some best practices for successful talent acquisition include:

  • Identifying which skills and roles need to be filled by external candidates
  • Gaining internal alignment on external talent needs and your talent acquisition budget
  • Writing engaging job descriptions
  • Developing an engaging employer brand
  • Encouraging employee referrals from existing team members
  • Leveraging talent sourcing tools to identify and attract the right talent
  • Promoting open roles on diverse sourcing channels such as general job boards, industry-specific job boards, social media, and talent marketplaces to expand your talent pool
  • Building relationships with prospective candidates to develop a talent pipeline
  • Implementing AI recruiting tools to streamline talent acquisition steps
  • Training hiring managers on interview best practices
  • Supporting a positive, engaging candidate experience

Strategies for talent planning

Effective talent planning requires a thoughtful approach and continual updates to align with shifting business and talent needs. Implementing proven talent planning strategies can help drive success.

1. Leverage data and analytics

Data and analytics can help your team understand strengths and weaknesses in your talent planning strategies and make data-driven decisions to drive improvements over time. Continually measuring key data points can also enable your team to provide insight into talent planning efforts to other stakeholders across the organization and help pinpoint areas where you may need to bring in external talent to address skills gaps and shortages.

Despite the benefits, an HR.com and Crunchr survey of 268 professionals found that only 22% of respondents believe their organizations are effectively using people analytics. Additionally, only 23% said their organizations integrate business data and HR data.    

The following metrics can help support your talent planning efforts:  

  • Team member engagement and satisfaction scores
  • Worker productivity rate
  • Retention rate
  • Retention rate for key talent on your team
  • Total worker tenure
  • Turnover rate
  • Rate of internal promotions and other transitions
  • Time to fill internal roles with existing team members
  • Training program participation rate
  • Training and development costs and ROI
  • Utilization rate for training software and resources
  • Training and development satisfaction rate among team members
  • Skills gaps

2. Foster a positive work culture

Individuals spend a significant amount of their day-to-day lives at work and fostering a positive work culture can help drive team member engagement and retention. According to a Society for Human Resource Management (SHRM) survey of 11,000 employees from around the world, respondents who rate their organization’s culture as “good” or “excellent” versus “poor” or “terrible” are almost nine times more likely to feel satisfied at work and are 83% less likely to be actively looking for a new job.

Here are a few ways you can foster a positive work culture:

  • Hosting in-person and virtual team-building activities
  • Planning celebrations for individual, team, and company-wide accomplishments and milestones
  • Saying thank you to individual workers or an entire team in an email, direct message, or meeting to show your appreciation
  • Launching internal awards to recognize team members for embodying your organization's mission and core values
  • Driving cross-team collaboration by launching projects that require multiple departments
  • Implementing a buddy system by pairing each new worker with an existing team member to learn more about the company when they first join
  • Allowing time for team community service projects and volunteer days
  • Supporting workplace flexibility, including offering remote and hybrid work and encouraging flexible schedules
  • Communicating business updates openly and transparently with workers
  • Encouraging team member feedback to continually improve the employee experience

3. Embrace diversity and inclusion

Prioritizing diversity, equity, and inclusion (DEI) can have a positive impact on your overall talent planning efforts by increasing team member engagement and driving employee retention. In fact, a GoodHire survey of 3,000 workers found that 81% of respondents would consider leaving their job due to an employer’s lack of commitment regarding DEI.

Some ways you can embrace DEI include creating a formal DEI policy, facilitating diversity training sessions for workers, acknowledging and celebrating holidays of all cultures, and supporting employee resource groups (ERGs) to foster connections between workers of shared interests or identities.

To continually improve your DEI efforts, consider distributing DEI-specific surveys to team members or including DEI-related questions in broader employee engagement surveys.

Questions to consider asking include:

  • How would you rate our organization’s commitment to DEI?
  • Do you believe company leaders show a commitment to DEI initiatives?
  • Do you feel comfortable voicing concerns or feedback related to diversity and inclusion with your manager or the HR team?
  • Do you believe the company’s recruiting process is fair and unbiased?
  • How can we improve the recruitment process to support DEI?
  • Do you feel a sense of belonging and inclusion at our organization?
  • What can we do to improve and ensure every team member feels included?
  • Do you believe that all team members have equal access to training, development, and advancement opportunities?
  • What additional steps or initiatives do you believe the company could implement to better embrace DEI?

4. Invest in technology

The latest technology solutions can enable HR and talent teams to work more strategically, drive workforce efficiencies, spend more time building relationships with team members, and maximize the effectiveness of talent planning efforts.

According to an HR.com and Eightfold.ai survey of 275 HR professionals, technology remains the highest-growing proportion of the HR budget in 2024, with 78% of respondents indicating their HR technology spending recently increased.  

Available HR and workforce technology solutions include:

5. Encourage continual learning and development

According to a global research report published by the World Economic Forum, an estimated 44% of workers’ core skills are expected to change in the next five years. As in-demand skills and competencies continue to rapidly shift, having an always-learning mindset is beneficial to both organizations and individual workers.  

In addition to offering diverse talent development resources as highlighted earlier in this piece, here are some ways to support continual learning and development:

  • Asking workers to set SMART goals related to learning and skills development
  • Developing learning tracking or career paths that highlight the skills and competencies needed for internal advancement
  • Regularly assess employee skills using talent assessment tools to measure competencies and identify areas of improvement
  • Encourage workers to experiment with new learning and development tools
  • Schedule knowledge sharing sessions for team members to discuss new skills and helpful learning solutions
  • Asking team members for feedback on your organization’s learning and development resources

Common challenges and solutions

Talent planning is an ongoing, strategic process and is increasingly challenging in today’s dynamic business landscape and labor market. According to a World Employment Confederation survey of 715 senior executives from around the world, 80% of respondents say planning for future talent needs has never been so hard.

Common challenges include:

  • Skills gaps. Identifying and addressing skills gaps within your organization can be challenging, especially as in-demand skills continue to rapidly evolve. One way to address this is by maintaining a skills inventory, in which you track existing skills, in-demand skills, emerging skills, and skills gaps. When you do have skills gaps, identify next steps to fill them, whether this means transitioning or developing internal talent or recruiting external candidates.
  • Turnover and retention. Employee turnover can throw a wrench in your talent planning efforts, as turnover can lead to lost productivity and decreased morale. When team members leave the organization, you’ll also have to backfill their roles, either with internal workers as part of your succession planning efforts or external talent. Consider distributing feedback surveys to understand employee satisfaction levels and identify ways to improve worker engagement and retention strategies.  
  • Business and workforce disruptors. Between widespread adoption of remote and hybrid work, increased workplace flexibility, technological advancements such as AI, and economic fluctuations, HR professionals have had to navigate several disruptors that impact talent planning in recent years. Take a proactive approach to regularly reviewing and refreshing your talent planning strategies to address potential shifting priorities.

Leverage Upwork for your talent planning needs

Adopting a strategic, proactive approach to talent planning can help your organization retain and develop top performers to support critical business objectives. Rather than handling the process on your own, consider engaging experienced professionals on Upwork to support your talent planning initiatives.

Through Project Catalog™, search one-on-one consultations and fixed-price projects based on your talent planning needs and get started right away. Browse available HR consulting, performance management, and employee learning and development projects now.


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Author Spotlight

Talent Planning: Essentials Guide With Strategies
Beth Kempton
Content Writer

Beth Kempton is a B2B writer with a passion for storytelling and more than a decade of content marketing experience. She specializes in writing engaging long-form content, including blog posts, thought leadership pieces, SEO articles, case studies, ebooks and guides, for HR technology and B2B SaaS companies. In her free time, you can find Beth reading or running.

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