4 Workforce Planning Techniques to Navigate an Unpredictable Economy
Posted on November 4th, 2019 Read time: 4 minutes
More than two millennia ago, Greek philosopher Heraclitus observed that change “is the only constant.” It’s a sentiment that no human resources professional would argue with.
The economic landscape has undergone tremendous upheavals over the past 20 years, much of it due to the tech-driven Fourth Industrial Revolution. Consequently, businesses owe it to their organizations to use proven methods to maintain operational flexibility while keeping costs under control.
One way to remain adaptable and fiscally viable is by adding contingent workers to the staffing mix. Many companies already use gig workers to maintain flexibility, according to the “Workforce Solutions Buyer Survey” from Staffing Industry Analysts. In fact, 15% of survey participants noted that they were prioritizing the international development of their freelance and contract workers. And around a fifth of respondents’ workforces included gig workers, indicating that their leaders already understand the benefits of a contingent workforce.
Indeed, attracting and retaining contingent talent makes sense in an unpredictable economy because it allows companies to vet workers before considering them for full-time employment. Additionally, managers can scale up or down according to economic changes without downsizing full-time staffers. Such advantages allow businesses the chance to remain competitive and nimble without chipping away at the bottom line.
Bringing in the Right Mix of Contingent Workers
Implementing a workforce strategy that adds or expands the number of gig workers requires effective planning in today’s dynamic environment. Below are four steps to beef up the use of contingent workers while simultaneously minimizing brand risk and optimizing cash flow.
1. Flesh out a strategic workforce planning map.
Seeing the big picture is essential to knowing how to best navigate change with the help of contingent workers. A workforce planning map allows everyone on your team to get on the same page, providing a snapshot based on market trends and what your company and its competitors are doing and producing. After creating your snapshot, you can overlay your organizational plans for the future.
Your next step in mapping your workforce involves laying out a talent acquisition and retention strategy that dovetails with your corporate ambitions. For instance, your workforce planning map may indicate that your brand strategy is weak in key areas. You can plug those holes by finding suitable contract workers or by changing your ratio of full-time and contingent workers.
2. Rank employees based on performance and potential.
Who is best-suited to help you bridge the gaps between where you are and where you plan to be tomorrow? You can figure that out with the help from a nine-box grid performance-potential matrix, with one axis representing performance and the other potential. The nine boxes in the matrix describe different types of team members. The upper-right-hand box represents employees who are high performers and have high potential. The middle boxes are for moderate performers, and the bottom left corner of the matrix represents risky personnel who are poor performers with limited potential.
Divide your current full-time and contingent team members into the nine boxes to illustrate how your workforce matches up. You don’t need everyone to be a superstar, though. Having people in the middle in terms of ability and potential is fine. But this exercise may reveal some truths about lower performers that you might not have noticed without seeing it on paper.
3. Generate forward-looking workforce scenarios.
After constructing a map of workforce planning techniques and a nine-box grid matrix, you can see where contingent workers will keep your workforce steady no matter what happens economically. To help you do this, you’ll need to identify some of the biggest economic uncertainties facing your company.
First, brainstorm the top change drivers pushing your business in certain directions. They could be anything from political movements to environmental concerns. Rank the drivers according to importance (those most likely to affect the workforce) and uncertainty (depending on what happens, you could need more or fewer workers). With your challenges in hand, you can build scenarios based on what you know today. Be innovative in your thinking, but remain grounded in reality. With your results, you can weigh whether contingent workers could contribute to your overall agility if scenarios come to fruition.
4. Prune your workforce if needed.
As a final step to remain pragmatic amid change, consider implementing a forced ranking performance appraisal method. The forced ranking system grades employees into A-level, B-level, or C-level players. Not surprisingly, A-level players have the most promise and charisma.
Forced ranking takes the nine-box grid matrix to the next level. Generally speaking, you want mostly A’s and B’s on your team. Otherwise, you might not be able to pivot as needed. C-level players hold back companies, so be prepared to remove undependable employees. You can replace them with gig economy workers who may end up becoming part of your full-time workforce later.
You can never stop change, but you can set up your organization to lead in a dynamic environment. The key is to strategically arrange your employees and contingent workers to meet current and future demands without disrupting the flow of operations or revenue.
Written By: Peter Limone, Chief Financial Officer (CFO) at IES
Peter Limone is the chief financial officer of Innovative Employee Solutions (IES), a leading global Employer of Record in more than 150 countries that specializes in contingent workforce solutions such as outsourced payrolling, independent contractor compliance, and contractor management services. Founded in 1974, IES has grown into one of San Diego’s largest women-owned businesses and has been named one of the city’s “Best Places to Work” for 10 years in a row.
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Posted on November 4th, 2019 Read time: 4 minutes
More than two millennia ago, Greek philosopher Heraclitus observed that change “is the only constant.” It’s a sentiment that no human resources professional would argue with.
The economic landscape has undergone tremendous upheavals over the past 20 years, much of it due to the tech-driven Fourth Industrial Revolution. Consequently, businesses owe it to their organizations to use proven methods to maintain operational flexibility while keeping costs under control.
One way to remain adaptable and fiscally viable is by adding contingent workers to the staffing mix. Many companies already use gig workers to maintain flexibility, according to the “Workforce Solutions Buyer Survey” from Staffing Industry Analysts. In fact, 15% of survey participants noted that they were prioritizing the international development of their freelance and contract workers. And around a fifth of respondents’ workforces included gig workers, indicating that their leaders already understand the benefits of a contingent workforce.
Indeed, attracting and retaining contingent talent makes sense in an unpredictable economy because it allows companies to vet workers before considering them for full-time employment. Additionally, managers can scale up or down according to economic changes without downsizing full-time staffers. Such advantages allow businesses the chance to remain competitive and nimble without chipping away at the bottom line.
Bringing in the Right Mix of Contingent Workers
Implementing a workforce strategy that adds or expands the number of gig workers requires effective planning in today’s dynamic environment. Below are four steps to beef up the use of contingent workers while simultaneously minimizing brand risk and optimizing cash flow.
1. Flesh out a strategic workforce planning map.
Seeing the big picture is essential to knowing how to best navigate change with the help of contingent workers. A workforce planning map allows everyone on your team to get on the same page, providing a snapshot based on market trends and what your company and its competitors are doing and producing. After creating your snapshot, you can overlay your organizational plans for the future.
Your next step in mapping your workforce involves laying out a talent acquisition and retention strategy that dovetails with your corporate ambitions. For instance, your workforce planning map may indicate that your brand strategy is weak in key areas. You can plug those holes by finding suitable contract workers or by changing your ratio of full-time and contingent workers.
2. Rank employees based on performance and potential.
Who is best-suited to help you bridge the gaps between where you are and where you plan to be tomorrow? You can figure that out with the help from a nine-box grid performance-potential matrix, with one axis representing performance and the other potential. The nine boxes in the matrix describe different types of team members. The upper-right-hand box represents employees who are high performers and have high potential. The middle boxes are for moderate performers, and the bottom left corner of the matrix represents risky personnel who are poor performers with limited potential.
Divide your current full-time and contingent team members into the nine boxes to illustrate how your workforce matches up. You don’t need everyone to be a superstar, though. Having people in the middle in terms of ability and potential is fine. But this exercise may reveal some truths about lower performers that you might not have noticed without seeing it on paper.
3. Generate forward-looking workforce scenarios.
After constructing a map of workforce planning techniques and a nine-box grid matrix, you can see where contingent workers will keep your workforce steady no matter what happens economically. To help you do this, you’ll need to identify some of the biggest economic uncertainties facing your company.
First, brainstorm the top change drivers pushing your business in certain directions. They could be anything from political movements to environmental concerns. Rank the drivers according to importance (those most likely to affect the workforce) and uncertainty (depending on what happens, you could need more or fewer workers). With your challenges in hand, you can build scenarios based on what you know today. Be innovative in your thinking, but remain grounded in reality. With your results, you can weigh whether contingent workers could contribute to your overall agility if scenarios come to fruition.
4. Prune your workforce if needed.
As a final step to remain pragmatic amid change, consider implementing a forced ranking performance appraisal method. The forced ranking system grades employees into A-level, B-level, or C-level players. Not surprisingly, A-level players have the most promise and charisma.
Forced ranking takes the nine-box grid matrix to the next level. Generally speaking, you want mostly A’s and B’s on your team. Otherwise, you might not be able to pivot as needed. C-level players hold back companies, so be prepared to remove undependable employees. You can replace them with gig economy workers who may end up becoming part of your full-time workforce later.
You can never stop change, but you can set up your organization to lead in a dynamic environment. The key is to strategically arrange your employees and contingent workers to meet current and future demands without disrupting the flow of operations or revenue.
Written By: Peter Limone, Chief Financial Officer (CFO) at IES
Peter Limone is the chief financial officer of Innovative Employee Solutions (IES), a leading global Employer of Record in more than 150 countries that specializes in contingent workforce solutions such as outsourced payrolling, independent contractor compliance, and contractor management services. Founded in 1974, IES has grown into one of San Diego’s largest women-owned businesses and has been named one of the city’s “Best Places to Work” for 10 years in a row.
