Ch. 16
Workforce Management
Workforce management involves HR practices and initiatives that let the organization meet its talent needs and close critical gaps in competencies.
Workforce planning
Workforce planning is the strategic process by which an organization analyzes its current workforce and decides what steps it needs to take to prepare for future needs.
The process:
- Understand the business strategy and its talent implications.
- Analyze supply: the current workforce profile (headcount, skills, demographics, retirement eligibility), attrition, and internal mobility.
- Forecast demand: the number and type of people needed in the future.
- Gap analysis: compare supply with demand to find surpluses and shortages.
- Develop solutions: build, buy, borrow, bridge, or redesign or automate.
- Implement, monitor and adjust.
Forecasting techniques:
| Type | Technique | Description |
|---|---|---|
| Quantitative | Trend analysis | Uses past staffing patterns over time to project future needs |
| Quantitative | Ratio analysis | Uses ratios between a business driver and staffing, such as 1 nurse per 4 patients, to project needs |
| Quantitative | Regression analysis | Statistical relationships between multiple variables and staffing |
| Quantitative | Simulation / scenario modeling | "What-if" models of several possible futures |
| Supply | Markov analysis (transition matrix) | Uses historical rates of movement between jobs (promotions, transfers, exits) to predict internal supply |
| Supply | Skills inventory | A database of employees' skills, education and experience |
| Supply | Replacement charts | Show potential replacements for key positions and how ready they are |
| Qualitative | Delphi technique | Anonymous expert input over several rounds |
| Qualitative | Nominal group technique | Structured group judgment |
| Qualitative | Management forecasts | Managers' estimates of their future needs |
The "B" talent strategies
| Strategy | Meaning | Best when… |
|---|---|---|
| Build | Develop current employees through training, upskilling and reskilling | There is time, and the skills are core and firm-specific |
| Buy | Hire externally | Speed is needed, or the skills don't exist internally |
| Borrow | Use contractors, consultants, gig workers or temporary staff | The need is short-term or specialized |
| Bridge | Move people internally into new roles (internal mobility, redeployment) | Adjacent skills exist and can be redirected |
Some frameworks add bind (retain key talent), bounce (remove low performers) and bot (automate).
- Upskilling improves skills for the current role.
- Reskilling trains people for a different role.
Organizational gap analysis techniques
Examining HR records, interviews, focus groups, surveys, exit interviews and digital skills assessments.
Nontraditional staffing
Gig workers, remote workers, seasonal workers, contract workers and interns. Others include temporary agency workers, part-time workers, job sharing and retirees rehired as consultants.
★ Watch for misclassification of employees as contractors, and for joint employment liability.
Knowledge management, retention and transfer
Benchmarking, thought leadership, documentation, communities of practice, mentoring and shadowing. These are especially important when retirements are approaching ("brain drain") and for tacit knowledge.
Succession planning
Succession planning is a talent management process that identifies high-potential employees and develops them so that, over time, they can move into leadership positions with more responsibility.
- Replacement planning: naming backups for specific positions. It is narrower and short-term.
- Succession planning: developing a pipeline of ready talent for critical roles over the long term.
The 9-box grid
The 9-box grid plots performance (current results) on one axis and potential (future capacity) on the other, each rated low, moderate or high.
| Low performance | Moderate performance | High performance | |
|---|---|---|---|
| High potential | "Enigma" / rough diamond: develop or find the cause | Growth employee / future star: develop | Star / top talent: ready for promotion, retain |
| Moderate potential | Inconsistent player | Core player: the backbone | High performer: develop and retain |
| Low potential | Underperformer: performance plan or exit | Effective employee | Trusted professional: reward and keep in role |
Development methods for successors: mentoring, cross-training, stretch assignments, job rotation, coaching and leadership programs.
Restructuring and downsizing
| Action | Description |
|---|---|
| Merger / acquisition | Combining organizations (as relative equals) or one buying another |
| Divestiture | Selling off part of the business |
| Reduction in force (RIF) | Permanently eliminating positions |
| Layoff | Technically a temporary separation with possible recall, though the term is often used for permanent cuts |
| Furlough | Temporary, unpaid leave or reduced hours. Employees keep their jobs. |
★ FLSA caution: exempt employees who do any work in a week generally must receive their full salary for that week.
HR's role in M&A:
- Due diligence: review the target's workforce, liabilities (pending lawsuits, ULP charges, unfunded pensions, misclassification), collective bargaining agreements, compensation and benefits, culture and key talent.
- Integration: harmonize benefits and pay, align policies and systems, retain key talent (retention bonuses), and manage cultural integration.
Conducting a RIF fairly and legally:
- Define the business rationale.
- Set objective selection criteria, such as skills, performance or seniority.
- Conduct an adverse impact analysis before finalizing the list.
- Check WARN Act notice requirements.
- For severance agreements with employees aged 40+, follow OWBPA rules: 21 days to consider an individual offer, 45 days for a group program, and 7 days to revoke after signing.
- Communicate in person with dignity, and provide outplacement and EAP support.
- Address survivor syndrome (guilt, anxiety, lower morale and productivity among the employees who remain) through communication and re-engagement.
Finished reading?