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According to Stone, Workforce planning is the process of systematically reviewing human resource requirements to ensure that the required number of people with the required knowledge, skills and abilities, are available when needed. The definition provided by Development in State of Alaska Executive
Branch Departments Website (2009) "Workforce planning is creating an integrated and ongoing strategy for ensuring an organisation is prepared with the appropriate human capital to meet current and future needs."
It ensures that "the right people with the right set of skills are in the right place at the right time all the time." S.A. Hassan and I.A. Al-Darrab described the WFP "â€¦is a fundamental planning tool, critical to quality performance that will contribute to the achievement of program objectives by providing a basis for justifying budget allocation and workload staffing levels. It provides managers with a framework for making human resource decisions based on the organisation's mission, strategic plan, budgetary resources, and the set of desired work force competencies".
The successful workforce plan should always tie to the organisation's strategic plan, strategic plan shows where the organisation is now and where it wants to be in the future, as well as how to plan to achieve it, and the workforce planning is to turn the strategic plan into specific objectives and actions that needs to take to meet that goal in the HR workforce planning and training areas.
The workforce planning helps organisation to meet the skills, qualifications needs, determines the areas that need to be developed and strengthened. It helps management creating a high quality workforce while the company grow, develop and change. The appropriate workforce planning will allow the organisation forecast the changes and been prepared rather than only action on the coming changes, such as retirement and the lost skills and knowledge. The results of workforce planning assist management to identify if the company need to change their strategies such as outsourcing, reorganising or providing more training for the existing employees to meet the skill and qualification that organisation required.
In this report I'm going to explore three important aspects of workforce: the demand predictions in the future, the current supply of the organisation, and realise the gap between them so that the management can find out a solution to eliminate the gaps.
Three main aspects
Demand will change as a result of changes to the organisation's direction, mission or strategy, new technologies and economic conditions. Those changes will affect the structure of the organisation, number of employees, the skill set, and workload.
The demand analysis helps the organisation to identify current and future workforce needs and workload, not only the numbers of employees needed, but also the right mix of competencies that are critical to successful job performance. It is very important to analyse not only what work organisation will do in the future but also how to do it.
Connie from CPS HR service stated, "The focus of the Demand Analysis is identifying the functions that an agency must perform, not just the people needed to carry out the functions." Organisation needs to make sure that the individual competencies are in accord with the competencies that needed by organisation to reach their goals and objectives.
NSW Council mentioned on their annual report (2000, P13), "Organisations need to analyse the needs for new or existing employees caused by the ageing population, high turnover or geographic population shifts; the industry and labour market trends; the new technology and new service delivery methods, and the new government legislations and new policies, those factors have the huge impact on the future workforce demand."
For instance the new technologies have changed the workforce demand in manufactory industries dramatically. With the advanced technologies, organisation needs less and less process workers and has more demands on those who have the skills to operate the high- tech equipments.
Take my current company HPM Legrand as example; we are going to introduce new technologies in R&D area from France in the next 18 months time, this will have impact on the our organisation's labour demand, the demand for those engineers who have the knowledge for the new technology will increase, not only the labour demand for R&D, it also influence the other areas such as manufactory and technical service support team. And the demand for employee work on the current technology will decrease.
The example of changing of legislation that influenced the workforce demand is the new Fair Work Act, in the FWA maternity and paternity leaves period have been increased up to two years, so that the organisation will have to take that into account when conducting the demand analysis, job share, succession plan or contractor can be used to cover the extra period of time.Page
Global Financial Crisis caused reduction of the labour demand globally is an excellent example of how external factor such as economic impact the local labour demand, as economic growth falls, the demand for labour decreases as well, The November 2008 Consensus Economics survey suggests the highest among market economists at present is an unemployment rate of 6.3% in 2009 (Consensus Economics, 2008).
As the economy becomes increasingly uncertain, organisations are more likely to use the part-time and casual employment instead of the full-time positions to reduce the manage risk.
The globalization has the potential to provide cost reduction, lowering the trade barriers, provide cheaper labour overseas, the local labour demand will decrease especially for the manufactory industry, lots of local factories closing down like Bonds, million's of workers have been made redundancy.
To conduct the supply analysis, the organisation will need to identify the current workforce reviewing tend data and to project the future workforce supply .
Organisation will need to start with accessing the current labour supply. As shown in HR Tech Consulting P/L for NSW environment protection Authority (2003), it is a snapshot of the number, characteristics, jobs, skills and abilities of employees in the organisation. By accessing the Job characteristics such as Salary rate, working hours, overtime hours leave liabilities, agreements/awards, employment status, qualifications and Job location; headcount and employee location; and demographics like age, gender, other EEO factors profile, length of service, classification /grades and recruitment and retention rates.
Stone (2008, P60), suggested that quantitative approach can be used for analyse current and future workforce and competencies such as workforce profile, hiring patterns, turnover rate as well as the retirement patterns.
The laour market will affect the workforce supply. Due to the globalisation, the world has become smaller, while we enjoy the beneficial from the globalisation, we also experience the downsides of it; skilled labour is being drawn from Australia by the high salaries being offered overseas. The internet opened the door for skilled individuals to apply for positions in almost any country in the world. The countries like US or UK, their salary level usually more than double that which they currently receive. The supply for those jobs such as nurse, teacher and trade man are way less than the demand.
The definition of gap analysis was provided by OPS (NC Office of State Personnel), 2008, "Gap analysis is the process of comparing the workforce supply analysis to the demand analysis to identify the difference or 'gap' and surpluses in staffing levels and skill sets or competencies needed for the future." The demand analysis shows what organisation need in the future and the supply analysis gives you an idea about what are available in the market. So the gap analysis will combine these two elements and develop a strategy plan to minimise the difference between what organisations need and what's available.
When the demand is higher than the supply, organisation can use succession plans, redesign the job, migrating skilled labour, traineeship, job share, retention plan provide relevant training or provide flexible working hours.
If I return to the HPM Legrand example, to overcome the skill shortage for the new technologies that are going to be introduced, the organisation decided to import the skilled engineers as well as those key positions that been effected by the new technology from France, by providing 457 visa, they will also provide training for the local employees while they working in Australia.
When the supply exceeds the demand, organisation can consider offering voluntary redundancy, in-voluntary redundancy or early retirement to reduce surplus. Or maybe can be transferred to other departments.
The workforce planning doesn't end here; it also involves the implementation and ongoing evaluation, because any of the upcoming internal or external factors may affect the plan. WFP cannot work solo, and it won't work without the business or strategy plan or without the support from the top management.
An effective workforce planning process is not only what the organisation will need in the future. The organisations that do WFP regularly will be able to response the sudden changes or the market shifts much quicker than those who do not have WFP.