Vice President, Recruitment Process Outsourcing (RPO) , EMEA
Workforce planning gets smart
Our experts discuss how predictive analytics is changing workforce planning, from talent acquisition to development and retention.
Workforce planning gets smart
Experts today are predicting that smarter workforce planning may lead to a slowdown in hiring in 2023. Companies will have the ability to make more calculated decisions as more data and a greater emphasis on strategy become the norm.
Elliot Clark, CEO of HRO Today, recently spoke with Iktimal Daneshvar and Richard Shea to understand how companies can use AI and predictive analytics to better forecast the skills, roles and geographies they need to focus on for talent acquisition, development and retention — linking this planning to business outcomes.
Shea started the conversation by summarizing the current hiring climate: “It's too competitive to be reactive or to rely on luck and hope that supply will meet demand at the time your organization is going to market.”
Previous barriers to planning success — it's too hard, we don't have the right data, hiring managers aren't on board —no longer hold water. The current market has forced companies to tackle the “elephant in the room” — workforce planning — and they’re embracing various approaches.
So how can companies get started? Shea says most companies begin by dividing workforce planning into smaller chunks to achieve bite-sized wins: “Examples of that would be focusing purely on special planning, or demand planning, or building skills taxonomies.”
“After that, companies may push to an operational workforce plan with a one-year projection. And when they've nailed those things, then they jump a little bit more into strategic initiatives and fully align those with the business strategy.”
Shea says the transition to a comprehensive workforce planning mindset truly occurs when HR takes ownership and links it to business needs. “That leads to the use of AI and predictive analytics that will help them make those decisions.”
Clark next asked Daneshvar, who focuses on talent acquisition in the Middle East, to share how data analytics is helping companies make smarter hiring choices. Daneshvar began by sharing a high-level look at hiring in the Middle East and one of the region’s biggest talent challenges: retention.
“Historically, you would post a job and people would come. That's not the case now. Organizations that are launching today need a plan. In Saudi Arabia, for example, there's dozens of new companies that are being launched monthly. Once we get people through the door, how do we actually retain them?”
Daneshvar says the key to acquisition and retention is correctly analyzing the right data. “It's not pivot tables in Excel, where we're putting some numbers against different projects and praying that the numbers meet. We're looking at predictive analytics, we're looking at cleaner data hygiene. This tells us when people are coming into the organization, where are they coming from, how long are they staying, their job type, and using those predictive analytics to estimate how long they'll be in the organization.”
A Korn Ferry report found that 40% of employee turnover is due to burnout, and the average cost of replacing these workers is 120% to 200% of their original salary.
Shea and Daneshvar say that smart workforce planning needs to account for the entire employee lifecycle, including internal factors, like burnout, that can drive employees to an early departure. For Daneshvar, this starts by ensuring employee voices are truly heard.
“There are the 360 surveys and the pulse surveys; are they being used effectively? Not by many organizations that I come across — employee voices are still not being heard. If we want to change how we engage our employees, they need a seat at the table.”
Shea concurs, adding, “You get burnouts from being understaffed and you get burnout from not having anywhere to take people into their next role. Upskilling and reskilling are important for professional development and can help minimize burnout.”
What’s the ideal formula for predictive workforce planning that integrates hiring and turnover? Talent managers must approach planning with a collaborative mindset that removes silos and partners with business leaders across functions to forecast the right roles and skills. When information is shared across functions, HR leaders can combine data, smart analytics and the voice of the employee.
To listen to the complete conversation, access the full podcast with HRO Today here.