How Do You Define Strategic Workforce Planning?

ADP Research Institute®

How Do You Define Strategic Workforce Planning?

This insight is from: "Strategic Drift: How HR Plans for Change "



Companies across the U.S. are struggling to fill talent shortages of individuals with specific skills at a time when technological developments, quickly evolving workplace norms, and the continuing fallout from the 2008-09 global financial crisis have caused dramatic changes to the workforce of today. An overwhelming number of senior executives from all regions of the country say the market for skilled talent will only become tighter. These findings are part of a study conducted by The Economist Intelligence Unit (EIU) and supported by the ADP Research Institute® to survey more than 500 C-suite respondents about where they are experiencing skills and labor shortages and what they are doing to improve it.

SWP Is Critical, But What Is It?

Survey respondents overwhelmingly agree that SWP is critical to their organization. However, there is little consensus over what strategic workforce planning (SWP) actually means.

Roughly one-third of respondents say the main objectives of their companies’ SWP is to retain key people to avoid skills gaps (36%); another one-third say SWP is understanding and finding the talent they will need in the future (33%); and another one-third believe SWP is recruiting new people to plug skills gaps (33%).

Though survey respondents are unable to agree on a definition of what SWP is, they most certainly agree that it has become a core issue for their company. Some three-quarters of respondents say it will be the leading strategic challenge for their companies in the future, rising to 87% in the construction sector and 91% in manufacturing.

So, Who’s In Charge of SWP?

Similar to their inability to find a common definition of SWP, C-suite survey respondents could not find consensus about who should be in charge of SWP. The highest number of respondents—42 percent—believes that primary ownership lies with the CEO or board of directors. The next highest answer, at 28 percent, says it resides with HR. Only 3 percent of respondents believe that primary ownership of the organization’s workforce planning strategy lies with the heads of individual business units. These results may reflect a difference of perception between the strategic and the HR elements of SWP: If it’s strategic, it belongs to top management, not HR, say our respondents.

Strategic Workforce Planning—Essential for the Long Term

Few doubt that SWP is important; many agree that it is critical. From the EIU survey results, however, we find that top-level executives from all across the U.S. cannot agree on exactly what SWP is or who should be in charge of it. While many companies have had a myopic focus on recent talent shortages, research suggests that HR departments may benefit from pulling back to view the problems systemically in order to determine what the best solutions to those problems might be for the long term.

Read the full white paper “Strategic Drift: How HR Plans for Change” to gain deeper insight into how HR is identifying and addressing skills shortages in the workforce—today and in the future.

About this report: Strategic Drift: How HR Plans for Change is an Economist Intelligence Unit report, supported by the ADP Research Institute. The Economist Intelligence Unit bears sole responsibility for the content of this report. The findings do not necessarily reflect the views of the sponsor. The report draws on two main sources for its research and findings:

  • A survey that included responses from 502 C-suite respondents in the U.S., evenly distributed across four geographic regions: the Northeast, the Midwest, the South and the West. Some 11% of respondents came from companies with fewer than 20 employees, 23% had 20-49 employees, 34% had 50-499 employees, 21% had 500-999 employees and 13% had more than 1,000 employees. Respondents came from four functional areas: 10% finance, 41% general management, 39% HR and 10% IT. They held a variety of C-level positions: 40% were CEOs; 10% were CFOs, treasurers or heads of finance; 40% were CHROs or heads of HR; and 10% were CIOs, CTOs or heads of technology.
  • A series of in-depth interviews conducted with senior executives.

Keywords: Human Capital Management, Talent Management

Business Types: Research for Midsized Organizations, Research for Large Organizations

Roles: Research for Human Resources Professionals

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