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Strategic Workforce Planning Aligning Talent and Strategy Presented by: Jill Lackey Allegacy Consulting Group Carolina Credit Union League HR and Professional.

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Presentation on theme: "Strategic Workforce Planning Aligning Talent and Strategy Presented by: Jill Lackey Allegacy Consulting Group Carolina Credit Union League HR and Professional."— Presentation transcript:

1 Strategic Workforce Planning Aligning Talent and Strategy Presented by: Jill Lackey Allegacy Consulting Group Carolina Credit Union League HR and Professional Development Conference October 23, 2014

2 What is Strategic Workforce Planning? Strategic workforce planning (SWP) is the analytic, forecasting, and planning process that connects and directs talent management activities to ensure an organization has the right people in the right places at the right time and at the right price to execute its business strategy Strategic workforce planning (SWP) is a critical business initiative and not a human resources activity Strategic (or long-range) planning = long-range planning for the business Strategic workforce planning = long-range planning for talent

3 Organizational Development: Strategic Workforce Planning Organizational Development Change Management Strategic Workforce Planning (SWP) Organizational Design and Structure Performance Management High Potential Employees (HIPO) Succession Planning Leadership & Career Development Cultural Initiatives

4 Two Types of Workforce Planning Operational workforce planning – focuses on skills and capabilities needed within the next 6 to 18 months. Strategic workforce planning – looks 3 – 5 years in the future and anticipates new skills, roles and situations that might not exist today. Deals with variables that cannot be predicted but can be prepared for.

5 The Business Case for Strategic Workforce Planning Each year, The Conference Board conducts a survey of CEOs, presidents, and chairmen from more than 1,000 companies around the world. The executives are asked to identify and rank the most pressing challenges they face. For the second year in a row, Human Capital — how best to develop, engage, manage, and retain talent — was named the leading challenge among ten choices.

6 The Business Case for Strategic Workforce Planning The strategies these CEOs plan to implement to address their concerns include: – Provide employee training and development. – Raise employee engagement. – Improve performance management processes and accountability. – Increase efforts to retain critical talent. – Improve leadership development programs. – Focus on internally developed talent to fill key roles. – Enhance effectiveness of the senior management team. – Improve effectiveness of front-line supervisors and managers. – Improve corporate brand and employee value propositions to attract talent. – Improve succession planning for current and future need

7 The Business Case for Strategic Workforce Planning A 2014 survey conducted by pwc states “As US companies return to growth mode, anxiety over skills needs intensifies: 70% of US business leaders are concerned about the availability of key skills, a sharp increase over 54% that said so in Demand for highly valued skills is strong; the “war for talent” is as fierce as ever. Thus addressing the skills shortage is about much more than hiring fresh talent. It means taking a fresh look at the talent within. Businesses that have been able to build up intellectual capital by continuously cultivating the next generation can experience a distinct advantage”.

8 The Business Case for Strategic Workforce Planning Aging workforce and approaching retirement wave – By 2020, 25% of the labor force will be age 55+, up from 12% in – In 2014, the annual growth rate of the overall labor force will shift 55-and-older = 4.1 % (4 times the rate of growth of the overall labor force) 25-to-54-year = 0.3 percent 16-to-24-year-olds - essentially flat Projected labor shortages – By 2018, with no change in current labor force participation rate or immigration rates and an expected return to healthy economic growth, we will have more jobs than people to fill them. Anywhere from 5.0 million to 5.7 million potential jobs vacant – If the full employment gap is not filled, using Congressional Budget Office data, estimate the loss in total output as high as $3 trillion across a 5-year period beginning in 2018

9 The Business Case for Strategic Workforce Planning Projected Leadership Shortage In numerous surveys, senior executives are expressing concerns that stiffening competition for exceptional individuals is curtailing plans for progress. – The Corporate Executive Board reports that 60% of organizations feel constrained by the leadership shortage – The Bersin Deloitte Advisory Board cites the need to develop organizational leadership capacity as one of the three biggest business challenges companies face today. – Bloomberg also rated leadership development among the top issues confronting HR professionals – Industry Week Magazine called the lack of potential leaders the most pressing human capital problem of our time

10 Strategic Workforce Planning Model Business Strategy Segment Roles Environmental Scan Future State Analysis Current State Analysis Gap Analysis Action Planning Monitor and Reporting

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12 Align to Business Strategy Analyze the long-range plan to identify impact to talent – What new core competencies emerge? – What organizational structure will best meet your future needs? – What systems and tools will be needed? – What are the cultural implications? – How will staffing needs change?

13 Align to Business Strategy Strategic Imperative: Implement business intelligence tools that drive performance to ensure long-term stability – Do you have the right technology people to identify, implement, maximize and continually evolve the use of these tools? – What impact will this have on the need for skills or competencies for users of this new data?– (how to analyze, systemic thinking, flexibility, change readiness)

14 Align to Business Strategy Strategic Imperative: Become an employer of choice Criteria for top 100 workplaces is based on trust and culture How will this impact what you look for in leaders? How will you shift the mindset of current leadership? What training is needed? How does this impact your succession planning criteria for promotable potential? How will you measure and evaluate this?

15 Role Segmentation ImpactTalent SegmentInvestments Over Time Roles that drive the strategy Strategic Critical to driving long-term competitive advantage, with specialized skills or knowledge Strengthen, retain and ensure succession plans are in place. 10 – 15% Roles that support the strategy Core The “Engine of the Enterprise,” unique to the company and core to delivering on its products and/or services Protect and Develop 20 – 30% Requisite Cannot do without, but whose value could be delivered through alternative staffing strategies (other than full-time headcount) Streamline, Outsource and Maintain 60 – 70% Roles impacted by the strategy Misaligned Talent whose skill sets no longer align with the company’s strategic direction Redeploy or retrain As few as possible

16 Environmental Scan External – Economic and regulatory External – Labor market supply (external supply of candidates, employment brand, competition, recruiting sources like colleges, trade associations, etc.) Internal – Organizational factors (long-range strategy, business plans, resource allocation, budgetary constraints, culture).

17 Environmental Scan External Economic and regulatory 1.What regulatory changes are anticipated between now and 2018? Do we have the right skills and competencies to respond? 2.How will the economic forecast impact our staffing needs in terms of skills, numbers and timing (e.g. improving housing market = > need for mortgage lenders, increase in capital spending = > commercial lending) 3.What are the impacts to talent from the “disrupters” in technology?

18 18 External Environment Economic Forecast Source: WSJ January Consensus Forecast

19 19 External Environment ● Taxation ● Risk-Based Capital ● Secondary Capital ● Business Lending ● Data Breaches/”Target” Incident ● Mortgage Regulations (QM) ● CFPB ● Definition of ERM Key Regulatory Agenda Items for Credit Unions

20 Environmental Scan External Labor market supply (external supply of candidates, employment brand, Competition, recruiting sources like colleges, trade associations, etc.) 1.What is projected employment rate within footprint? How does this impact growth plans? 2.What colleges offer the skills you will need in the future and how can you start building relationships now? 3.What “employment brand” will attract millennials? How do you need to change to support that brand?

21 21 External Environment Unemployment Trends CountyUnemployment Rate Mecklenburg, NC6.7% Forsyth, NC6.1% Source: BLS.gov; Data reported for December 2013

22 Environmental Scan Internal Organizational factors (long-range strategy, business plans, resource allocation, budgetary constraints, culture). 1.What is projected membership growth ? how many employees will be needed? Where? How many Branches? What percentage of members will use FCs, mobile, CC, web? 2.What new technical skills are needed to support LRP? 3.What products or services will be used to drive projected growth each year and do we have the talent to support them? (e.g. lending growth – mortgage? Retail? Equal?) 4.What delivery channels anticipate the greatest growth, when and how? Do we have the talent to support? 5.What is the impact to organizational structure, and staffing gaps, and/or surplus? 6.What training will need to be provided, when and for whom in order to prepare staff?

23 Future State Analysis Future State Analysis – a framework for having a strategic discussion about future possibilities in order to identify future talent needs. Strong economy – adequate talent supply vs. inadequate talent supply Impact – compensation pressures, buy vs grow, college recruitment, alternative sources Member demographics and expectations Impact – technology skills, behavioral competencies Employee demographics and expectations Impact – attraction, retention, development and engagement Impact of technologyImpact – Resources, skills, alternative sources, organizational structure – centralized or decentralized?

24 Current State Analysis Current State Analysis – Detailed analysis of current capability and capacity. Gather employee data by function:  Employment status  Location  Demographics  Competencies and skills  Diversity criteria  Compensation data  Tenure  Retirement eligibility  Performance ratings  Potential  Engagement scores  Status of successors Analyze employee reports for gaps, vulnerabilities, opportunities and engagement level. What is the impact?

25 Gap Analysis Compare current state to future state for EACH role – Role segmentation – Headcount needs – Skills and competencies – Experience and education – Behavioral characteristics – Level of engagement

26 Gap Analysis Position: Gap DimensionCurrent StateFuture State Gap Role segmentation Headcount requirements Vulnerable positions (retirements, transfers, resignations, performance issues) Engagement level Retention risk (qualitative not quantitative) Bench strength or availability Technical/business skills Behavioral characteristics/other competencies Experience and education

27 Action Planning Organizational structure design Job redesign Attraction and acquisition plan (recruitment strategies) Outsourcing options Redeployment needs or retooling plan Performance management Succession planning Learning and development plans Total rewards strategy Retention and engagement strategy

28 Position: Branch Manager Gap DimensionCurrent StateFuture State Gap Role segmentation SupportingCore Need to be more strategic; increase impact to operating excellence and revenue Headcount requirements Vulnerable positions (retirements, transfers, resignations, performance issues) 3 Mgrs & 1 Asst. Mgr – 60 yrs. +; 2 open positions 6 Mgrs & 2 Asst Mgr – 60 yrs. Be prepared for departure of up to 8 managers by 2018 Engagement level (Based on Denison Organizational Culture Survey) Empowerment = 68% Vision = 88 th Cap Development = 37 th Empowerment > 75% Vision > 75 th Cap Development > 50 th Increase scores by: Empowerment: 7 %ile Capability Development: 13% Retention risk (qualitative not quantitative) Competitive field for recruitment; average days to fill = 80 Need to define a clear career path for Branch Managers Create formal Mgr. training Program for Asst Managers; Career Development coaching Bench strength or availability 0 AM ready for promotion wi next 12 mths 2 or > AM ready for promotion within next 6 months Hire Asst Mgrs with skills and potential for advancement Technical/business skills Two plus years consumer lending exp. Data Analytics Technologically savvy Change recruiting criteria Create technical training Behavioral characteristics/other competencies Sales focus, strong interpersonal, leadership, oral and written communication skills Inspirational leader Systems thinking Intellectual curiosity Risk-taker Change recruiting criteria Create training modules on these topics; Provide mentors Identify developmental assignments Experience and education Three or more years related experience in financial institution branch Bachelor’s degree and/or equivalent experience in financial institution; customer service mgmt. experience Change recruiting criteria Promote education reimbursement program

29 Monitor and Report Establish metrics Create quarterly reporting and accountability procedures Schedule quarterly SWP review meetings

30 Keys to Making Strategic Workforce Planning… Strategic Driven by business strategy and objectives Executive team’s commitment to making SWP a priority so it is proactive vs. reactive Accurate and objective segmenting of the workforce Consistent and sustained process and approach Readily accessible analytics Executive team’s capability to lead change

31 Supporting Infrastructure Superior communication strategy Enterprise-wide project management Technology Teamwork and collaboration


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