The Basics on Headcount Planning

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Headcount planning is a strategic talent management exercise. It ensures organizations have the right people, the right skills, in the right roles. The process usually looks at reviewing your talent, hiring targets, succession plans, promotions and training.

A successful headcount planning process looks at internal and external changes and aligns talent strategies with organizational strategies and goals. You need to focus on

  • Identifying skills that the current workforce lacks.
  • Focus recruiting on the right candidates with the skills you need now and in the future.
  • Identify and mentor employees who can fill critical skills gaps.
  • Identify a budget for hiring new staff and developing employees.

Here are four steps to get started

1. Identify Your Business Challenges

Look at what you need to focus on as a company. Here are a few sample questions:

  • What is our goal for the year?
  • Are there challenges for your business and/or industry?
  • What opportunities do we have as an organization?

The more you understand and define your business goals, the more successful your headcount planning process will be.

2. Establish Metrics

You need to evaluate your existing talent and figure out your talent needs. Successful headcount plans must have defined metrics to make talent changes and plan accordingly. A few suggested metrics are performance ratings, position requirements, employee skill sets, retirement eligibility.

3. Evaluate Your Data

Now that you have the metrics defined how do you use them? Here are some questions to ask:

  • Which roles are critical now and which ones will be in the future?
  • Which positions (if any) can we do without to maximize the ROI of our workforce?
  • Where are we having problems with attrition and what can we do about it?
  • Are we growing or hiring succession-eligible employees?

4. Plan for the Year

Your headcount plan should be a living document and therefore you should be reaching out for insights from your departmental and business line leaders to evaluate needs.

Headcount planning can be very successful when planning and budgeting for talent needs. It takes planning into consideration versus always being reactive to employee changes. It looks at training, transitions, hiring and retiring and creates a road map for success while taking the guessing game out of workforce planning.