SWP and Strategic Priorities
In part three of our four-part series on Navigating Uncertainty and Emerging effectively, Alicia Roach, Chris Hare, and Ian Bailie discuss how strategic workforce planning delivers on the strategic priorities of an organization.
We took a quick poll of attendees and found that while organizations are focused across a broad spectrum of strategic priorities, the two that are currently receiving the most focus in today's economic climate are customer experience and retention and operational efficiency -- two areas where SWP play a key role in enabling an organization's success. In this article we'll cover the following topics: Strategic Priorities for Organizations The Role of HR in SWP Balance with SWP
SWP: The Intersection of Business Strategy, Finance, and HR
This transcript has been lightly edited for clarity.
Strategic Priorities for Organizations
Ian Bailie: I think something that that's come up constantly as we've been talking about strategic workforce planning has been that link back to strategy, right? The strategy component as the starting point is so important. So, let's have a look at the results here, as expected, I guess. Like quite a quite an interesting spread. A lot of these coming up as key priorities, that customer retention and experience and operational efficiency are the ones that are coming out high, which is interesting, particularly what we're talking about with that focus on efficiency earlier. So, I guess what I want to talk about a little bit with these strategic priorities is that all of these are areas where workforce planning can help.
When we think about strategic workforce planning, it does start with that strategy. It is all about the business, and it's about understanding how the business can really do what it needs to achieve that strategy with the talent that it has, or that it needs to go and get.
And we all know that. It feels intuitive, but we also know that it can often be incredibly hard for HR Professionals to get buy-in or to get support for activities, and this links quite nicely to the question around the role of HR VPs and CHROs in building the capability for strategic workforce planning.
The Role of HR in Strategic Workforce Planning
I would love to talk about this role of HR. How does HR work with the business? Get that buy-in from the business? Have you seen this kind of partnership become successful in some of the organizations that you've worked with?
Chris Hare: It's a particularly interesting topic, and it's one that frankly, we've evolved over time. Evolving this space hits the intersection of Strategy, Finance and HR. That said, who's the owner? And I think it’s quite a good way to put it in that the strategy part is a broader business planning kind of question.
While the P, the plan, often has a lot to do with determining the HR agenda and the people plan, there's other things that span out of that. But at its core, HR is a clear stakeholder.
The question is...are they the driver? For certain businesses, they aren't. But I think ultimately HR is the custodian of people, and ultimately they are the ones where it makes the most sense for them to be sponsoring this work.
But we have to really shift that conversation. We've been working on shifting the conversation as well, and I think it's going from talking about this shiny ball will strategic workforce planning and really moving into having a conversation about the business problems we're trying to solve. These problems have been around for a long, long time, and there's this mechanism called strategic workforce planning that we're using to solve them. And I think by talking about that mechanism we've all done a big disservice here, and business is not asking HR necessarily to solve its strategy problems. But, in fact, that's what SWP does.
So, we need to drive this focus that we're not here to talk about just your headcount forecast. We're here to talk about how our organization is going to achieve its purpose. For many organizations that's about customer value. So, what are the different things that are facing the disruption in the marketplace?
Uncertainty in the economy. Transformation initiatives that we're trying to enact. New products that we're trying to deliver. How are we changing as an organization?
Yes, we know that fundamentally that means that the workforce must change, but let's have that conversation first about the future and different scenarios that we may be facing. Ultimately, we then want to future-proof the organization. And that's by enabling the workforce. And so, I think it is really that shifting conversation, if HR is going to continue to sponsor this. It needs to be clear about the problems that it is seeking to solve, not the thing it wants to do to the business.
Balance with SWP
Alicia Roach: Yeah, I think that it's really interesting. In our poll earlier, 63% of people are looking at operating efficiency. And obviously part of that is this cost management and focus around that side of things. But then the same amount were really focusing on customer experience and that side of things. And that's a real challenge when you're trying to balance the operating efficiencies, and some of these decisions that are being made by organizations are actually counter to what they're trying to achieve with customers. And we have come in a few times over the Covid era with some customers who had cut too deeply and reacted too quickly in the wrong way, and that did damage the customer proposition and what they were trying to achieve. Those lost customers are very hard to get back. So what we're really trying to create with strategic workforce planning is balance. Not only how do we do both, but how do we do both effectively?
SWP: The Intersection of Business Strategy, Finance, and HR
And that's why SWP at the heart of it really is as Chris said, when it's done correctly, that intersection of the business strategy, finance, and HR Because we're bringing these all these different moving intentions together in a coherent way. Fundamentally, as HR Practitioners, we believe that SWP should be sitting with HR. They're the custodians of the workforce.
I've seen finance-led workforce planning, and it becomes very cost focused. Oh, is there a human actually attached to those numbers? That can kind of can get lost to the side of it. And certainly, this whole skills piece and employee lifecycle, well, that's just, not even really part of the equation. So, we fundamentally do believe that this is such a great opportunity for HR to have a seat at the table and evolve to a strategic function. This is solving the problems that the business cares about: customer, revenue, cost.
You know this is where it all comes together. It's such a powerful place for HR to play. The HR functions that are stepping up and kind of taking the lead and driving this conversation are starting to see other parties like our finance teams or transformation functions, or even operations, move in and start to do this and answer the questions. And for me, I think that's a real lost opportunity. It is a partnership. But I think this is the future of HR. For me, it really addresses all the things that we're talking about, the skills piece, the future of work, whatever buzz words are coming our way, whatever externalities are coming our way. This is where we really make sense of that and get that context. And, as I said, actionable insight.
The ROI of SWP
Chris Hare: . And to simplify for HR and Strategic Workforce Planning champions who are trying to drive this in in their organizations and get attention. We have to be really clear about the problems we solve, and we have to be really clear on the numbers and the business case for doing this. Organizations work based on the ROI of any initiative that they take. There are three core areas here that you can show numbers for an ROI case:
Assisting with a percentage of the total HR budget and making sure that's focused
Optimization of the workforce (the percentage of salary and wages that you get right)
Ultimately, it is about customer value, and therefore there's a percentage of revenue that's at play. If we don't have enough of the workforce to deliver to customers, we're going to have less revenue. So what is that play? How much does SWP help us focus leaders and solve for that? That component in particular is where people need to focus the conversation.
SWP helps you make money, and it helps you save money, and it's bringing those things together and driving a really strong conversation with our friends in finance and strategy to get this going.
Miss an earlier installment? Layoffs and Strategic Workforce Planning Skills, Skills, Skills