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 GroupCarolina Credit Union League HR and Professional Development ConferenceOctober 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 strategyStrategic workforce planning (SWP) is a critical business initiative and not a human resources activityStrategic (or long-range) planning = long-range planning for the businessStrategic workforce planning = long-range planning for talent
3 Organizational Development: Strategic Workforce Planning ChangeManagementStrategic Workforce Planning(SWP)DesignandStructurePerformanceHigh PotentialEmployees(HIPO)SuccessionPlanningLeadership & CareerCultural InitiativesNarrow the focus from Talent Development to Strategic Workforce Planning
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 waveBy 2020, 25% of the labor force will be age 55+, up from 12% in 1990.In 2014, the annual growth rate of the overall labor force will shift55-and-older = 4.1 % (4 times the rate of growth of the overall labor force)25-to-54-year = 0.3 percent16-to-24-year-olds - essentially flatProjected labor shortagesBy 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 vacantIf 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 ShortageIn 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 shortageThe 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 professionalsIndustry Week Magazine called the lack of potential leaders the most pressing human capital problem of our time
10 Strategic Workforce Planning Model Business StrategySegment RolesEnvironmental ScanFuture State AnalysisCurrent State AnalysisGap AnalysisAction PlanningMonitor and ReportingBusiness Strategy - The business strategy must drive the workforce strategy, and the two must be closely aligned. A strategy of cost leadership, for example, will have different workforce implications from a strategy of customer intimacy.Segment Roles - It is the people in the roles that are most vital to implementing the strategy of the organization that provide the greatest value. While all roles are important — that is why salaries are paid to people in those roles —some add more strategic value than others. the name impliesEnvironmental Scan - this is done through a combination of analyzing the LRP to identify key business issues that could impact talent (changes in strategic direction, product, geography, delivery mechanisms, technology uses), report analysis and researchExternal – 2 types of external environmental analysis. First are things like government , regulatory, population demographics, cost of living, competitors. The second is labor market issues like external supply of talent, employment brand, contingent staffing capabilities, etc.Internal – strategy, resource allocation, budget, culture,
11 Current State Analysis - Detailed analysis of current capability and capacity. Gather employee data by function:Employment status LocationDemographics Competencies and skillsDiversity criteria Compensation dataTenure Retirement eligibilityPerformance ratings PotentialEngagement scores Status of successorsFuture State Analysis - a framework for having a strategic discussion about future possibilities in order to identify future talent needs. The impact of a strong or weak economy, member and employee demographics and expectations, impact of technologyGap analysis - compare current state to future state for EACH roleAction Planning – what are you going to do about itMonitor and Reporting - establish metrics; create quarterly reporting and accountability procedures
12 Align to Business Strategy Analyze the long-range plan to identify impact to talentWhat 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 stabilityDo 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 choiceCriteria for top 100 workplaces is based on trust and cultureHow 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?Criteria for Fortune’s Best Companies to Work For:Two thirds of the company’s score is based on the institute’s score on the Trust Index Survey, which is sent to a random sample of the employee’s each year. The survey asks questions about their attitudes towards management’s credibility, job satisfaction and camaraderie. The other third is based on responses to the institutes Culture Audit, which includes detailed questions about pay and benefits programs, and a series of open-ended questions about hiring practices, methods of internal communication, training, recognition programs and diversity efforts. After evaluations are complete if any news comes to light that might damage employees’ faith in management, we exclude it from the list.Culture AuditAre employees at company X compensated fairly?Is salary on par with competitive companies?Are benefits comparable to those of a company’s competitors?Does the company have programs in place that demonstrate they value your work? This can range from awards to bonuses, and even be as basic as regular performance appraisals.Does the company invest in training to ensure employee success?Does management have an open door policy?Is there a good stream of employee communications in the company?Are employees challenged?Do your values match those of the company?
15 Role Segmentation Impact Talent Segment Investments Over Time Roles that drive the strategyStrategicCritical to driving long-term competitive advantage, with specialized skills or knowledgeStrengthen, retain and ensure succession plans are in place.10 – 15%Roles that support the strategyCoreThe “Engine of the Enterprise,” unique to the company and core to delivering on its products and/or servicesProtect and Develop20 – 30%RequisiteCannot do without, but whose value could be delivered through alternative staffing strategies (other than full-time headcount)Streamline, Outsource and Maintain60 – 70%Roles impacted by the strategyMisalignedTalent whose skill sets no longer align with the company’s strategic directionRedeploy or retrainAs 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).The environmental scan is completed through a combination of analyzing the LRP to identify key business issues that could impact talent (changes in strategic direction, product, geography, delivery mechanisms, technology uses), internal and external report analysis and research
17 Economic and regulatory Environmental ScanExternalEconomic and regulatoryWhat regulatory changes are anticipated between now and 2018? Do we have the right skills and competencies to respond?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)What are the impacts to talent from the “disrupters” in technology?
18 Economic Forecast External Environment Source: WSJ January Consensus Forecast
19 Key Regulatory Agenda Items for Credit Unions TaxationRisk-Based CapitalSecondary CapitalBusiness LendingData Breaches/”Target” IncidentMortgage Regulations (QM)CFPBDefinition of ERMExternal Environment
20 Environmental Scan External Labor market supply (external supply of candidates, employment brand, Competition, recruiting sources like colleges, trade associations, etc.)What is projected employment rate within footprint? How does this impact growth plans?What colleges offer the skills you will need in the future and how can you start building relationships now?What “employment brand” will attract millennials? How do you need to change to support that brand?
21 Unemployment Trends County Unemployment Rate External Environment 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).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?What new technical skills are needed to support LRP?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?)What delivery channels anticipate the greatest growth, when and how? Do we have the talent to support?What is the impact to organizational structure, and staffing gaps, and/or surplus?What training will need to be provided, when and for whom in order to prepare staff?
23 Future State AnalysisFuture 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 supplyImpact – compensation pressures, buy vs grow, college recruitment, alternative sourcesMember demographics and expectationsImpact – technology skills, behavioral competenciesEmployee demographics and expectationsImpact – attraction, retention, development and engagementImpact 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 statusLocationDemographicsCompetencies and skillsDiversity criteriaCompensation dataTenureRetirement eligibilityPerformance ratingsPotentialEngagement scoresStatus of successorsAnalyze 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 segmentationHeadcount needsSkills and competenciesExperience and educationBehavioral characteristicsLevel of engagement
26 Gap Analysis Position: Gap Dimension Current State Future State Gap Role segmentationHeadcount requirementsVulnerable positions (retirements, transfers, resignations, performance issues)Engagement levelRetention risk (qualitative not quantitative)Bench strength or availabilityTechnical/business skillsBehavioral characteristics/other competenciesExperience and education
27 Action Planning Organizational structure design Job redesign Attraction and acquisition plan (recruitment strategies)Outsourcing optionsRedeployment needs or retooling planPerformance managementSuccession planningLearning and development plansTotal rewards strategyRetention and engagement strategy
28 Position: Branch Manager Gap DimensionCurrent StateFuture StateGapRole segmentationSupportingCoreNeed to be more strategic; increase impact to operating excellence and revenueHeadcount requirements15238Vulnerable positions (retirements, transfers, resignations, performance issues)3 Mgrs & 1 Asst. Mgr – 60 yrs. +; 2 open positions6 Mgrs & 2 Asst Mgr – 60 yrs. Be prepared for departure of up to 8 managers by 2018Engagement level(Based on Denison Organizational Culture Survey)Empowerment = 68%Vision = 88thCap Development = 37thEmpowerment > 75%Vision > 75thCap Development > 50th Increase scores by:Empowerment: 7 %ileCapability Development: 13%Retention risk (qualitative not quantitative)Competitive field for recruitment; average days to fill = 80Need to define a clear career path for Branch ManagersCreate formal Mgr. training Program for Asst Managers; Career Development coachingBench strength or availability0 AM ready for promotion wi next 12 mths2 or > AM ready for promotion within next 6 monthsHire Asst Mgrs with skills and potential for advancementTechnical/business skillsTwo plus years consumer lending exp.Data AnalyticsTechnologically savvyChange recruiting criteriaCreate technical trainingBehavioral characteristics/other competenciesSales focus, stronginterpersonal, leadership, oral and written communication skillsInspirational leaderSystems thinkingIntellectual curiosityRisk-takerCreate training modules on these topics;Provide mentorsIdentify developmental assignmentsExperience and educationThree or more years related experience in financial institution branchBachelor’s degree and/or equivalent experience in financial institution; customer service mgmt. experiencePromote education reimbursement program
29 Monitor and Report Establish metrics Create quarterly reporting and accountability proceduresSchedule quarterly SWP review meetings
30 Keys to Making Strategic Workforce Planning… Strategic Driven by business strategy and objectivesExecutive team’s commitment to making SWP a priority so it is proactive vs. reactiveAccurate and objective segmenting of the workforceConsistent and sustained process and approachReadily accessible analyticsExecutive team’s capability to lead change
31 Supporting Infrastructure Superior communication strategyEnterprise-wide project managementTechnologyTeamwork and collaboration