Many companies have already made difficult decisions, some are making them now, and we will all have more to make in the future. In such an uncertain economic environment, hiring and workforce needs are difficult to understand and impossible to pin down. This is why workforce planning is your most important HR tool right now.
What Does Workforce Planning Do?
While always a helpful and necessary activity, workforce planning can help create a roadmap for how to navigate the COVID-19 landscape. Companies are always thinking about their future workforce needs, but as the curve of confirmed cases rises and falls region-by-region, the immediate concern is how to plan for immediate needs, sudden changes, new regulations, and evolving revenue projections.Crisis readiness requires a plan for a number of scenarios. @ClearCompany has some tips to tackle your #WorkforcePlanning that work with the unpredictability of the COVID-19 landscape:
While a 1, 3, or 5-year workforce plan may look at things future product launches, venture capital funding, or department expansion, the current landscape requires planning for scenarios such as what happens if clients are quickly lost or gained, essential employees need to resign or take time off to fill a childcare gap, and what to do when things start to ramp back up to normal.
For our business earlier this year, we created simple stages for protocols given different scenarios of spread that serve immediate needs. And while that serves an important purpose in the workplace so that all employees know what to expect and what to do, action is still required to ensure that the company is able to sustain itself through the duration of the crisis.
Bonus Content: View the ClearCompany Business Continuity Plan!
Longevity Through a Crisis
The simple answer is that the key to survival is maintaining enough cash to stay afloat until the economy begins to recover along with an executable plan for how to grow again when the time is right. Of course, that’s easier said than done, and it will require a strategic and tactful workforce planning strategy to make it happen. While contractions are never a fun solution, having a plan that is clear, objective, and strategic can make the process as painless as possible during a delicate time.
A Careful Strategy for both Hiring and Reductions
An effective workforce planning strategy during a downturn requires the following considerations:
- A re-forecasted business model or projection of the impact you think the new climate will have on you. For example, today, a company in the virtual learning or online event industry needs a very different plan than a local restaurant chain.
- How many people in each role do you need to accomplish these re-forecasted goals?
- What impact does that have on overall human capital expenses?
- If you need to gear up for growth:
- What is your expected time to hire?
- What are your expected ramp or training times for new hires?
- Will growth in your industry impact employee turnover? If so, when do you expect to need backfills?
- If you are facing a reduction:
- Can it be achieved by reducing salaries?
- Will some employees need to be furloughed, and for how long is that sustainable?
- How many employees would need to be laid off?
- What does your revenue stream need to look like before you can begin paying full salary again?
- What does your revenue stream need to look like before you can bring back furloughs?
- What does your revenue stream need to look like before you can start hiring again?
Before making any moves, it’s important to have a clear picture of your revenue stream and your expenses. Are you seeing or anticipating recovery to happen quickly? Do you need to find more expenses to cut in order to alleviate layoffs? Were you able to secure funding? Factors like these can be added to a tiered or phased system so as to keep employees at their jobs as long as possible or bring people back to work quickly without risking the longevity of the company.
Additionally, communication and delicacy will be needed. Most employees will not be surprised by these actions, but doing so with grace, transparency, and respect will help in retaining relationships and reputation for when you’re ready to hire again.
And as your business recovers, careful planning, and consideration are necessary. Those who have taken pay cuts, for example, will expect full salaries again before new hires are added, and hiring must be done with consideration for those who were let go. Will they be asked to come back? Why or why not? How will you communicate that decision to their former coworkers who saw them dismissed?Are you ready for whatever COVID-19 throws at your business? @ClearCompany shows you how #WorkforcePlanning can help you account for multiple scenarios and unforeseen circumstances:
Anticipating an Unwieldy Economy
It’s important to remember during COVID-19 that the curve is not a perfect bell curve. While it may look like today you’re ready to increase salaries and bring back furloughs, there has to be a consideration for sudden spikes in community spread of the virus and sudden pitfalls in the economic curve to match. Have contingency plans in place, and be thorough about what signals you can ramp up hiring sustainably, and what may just be a moment of good fortune. There is no roadmap for a crisis like this, so plan for every last scenario, and act only when you’re confident.
How ClearCompany Makes it Happen
Effective workforce planning should always be an ongoing, strategic collaboration between Finance, HR, and impacted departments. However, only 28% of companies indicate they have a shared reporting or modeling system for headcount planning across departments. This makes even a standardized annual planning process burdensome and laden with static spreadsheets that don’t flex easily to updates. In today’s constantly evolving environment, a nimble planning tool is essential to both effectively plan and reduce the heavy administrative burden that can come with changing goals and models.
Whether you are planning for scarcity or abundance, ClearCompany talent planning tools provide unparalleled insights into your people, performance, and future needs. HR can align with finance on budgets, see where your A Players are, what their defining qualities are, and how to hire based on your limitations while serving your business initiatives.
Continuous and collaborative talent planning allows HR teams to instantly map out different scenarios and see how both layoffs and hiring would make an impact given a number of situations, making it easier to understand how workforce decisions will impact the business now and later.
For more information on our Workforce Planning and People Analytics solution, reach out to our experts today and schedule a free demo.