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The current unemployment numbers paint a grim picture–but not every organization is cutting back. Amazon, for example, is going through a hiring boom. Other businesses are simultaneously experiencing both an increase and a decrease in demand for different types of talent.
As organizations grapple with the new reality, we are seeing a focus on operational workforce planning (looking three to 12 months ahead). This is very different from strategic workforce planning, which typically looks anywhere from three to 10 years into the future. Aligning headcount supply with a longer term business vision is complex–but so is the kind of here and now planning that is going on these days.
To start, there is the human dimension to think about: putting people first takes on a whole new meaning during these extraordinary times. Because we are in the midst of a public health crisis that impacts absolutely everyone, leaders want to ensure they are doing the right thing for their employees, their families, and their communities. Avoiding job cuts whenever possible requires thoughtful risk-taking tactics.
And secondly, “right-sizing” (making sure you have the right people in the organization and balancing cost constraints with the need for more, less, or different talent) is particularly challenging when the future is so uncertain.
Responsible Right-Sizing: The Role of People Data
Now, more than ever, HR leaders need the right people data so that they can quantify where the organization sits in terms of skills, roles, and operational requirements. It may seem counterintuitive, but a precise understanding of cost constraints and talent capacity can actually lead to more creative thinking.
Below are some specific best practices that we are seeing emerge as organizations move out of the reactive phase of the crisis (for a full definition of the three phases of crisis management–React, Respond, and Recover–read this earlier post). These best practices have been woven into a series of steps that organizations typically follow in the workforce planning process:
Step 1: Determine the business impacts
Getting to the point where you can say that your organization needs to pull back, expand, or even stay the same size but restructure is the output of a lot of work. It all starts with an in-depth understanding of how COVID-19 is impacting your business.
Right now, proactive HR professionals are having critical conversations with their business leaders. They are determining how the bottom line is being impacted, and looking at what this means from a people perspective. Here are just a few of the questions they are asking:
What are the immediate and longer term impacts on demand?
You could be experiencing both reductions and increases in demand. For example, projected revenues from your storefront operations may be virtually non-existent, meaning you do not need staff in this area. However, you may be ramping up your e-commerce lines of business, which requires you to move existing people into new roles or even hire.
Another factor to consider is the shelf-life of your product. Gourmet food items are probably not selling like hotcakes right now. But on the other hand, you want to be prepared for when buying patterns change again. This means you will need people in different production facilities at different times to ensure that employees are trained and properly prepared to quickly start-up production cycles once the consumer market has returned to normal. You may have to determine if a furlough is a better solution vs. a layoff. Paying for benefits continuance may be a better option given that terminating and hiring people is also very costly.
Are we temporarily shifting business focus? How?
Ford and GM have moved from making cars to ventilators. Breweries are making hand sanitizer. Restaurants are catering, delivering and preparing meals for take out instead of dine-in service, creating a need for more culinary staff and perhaps drivers in place of servers. In each of these cases, leaders need to understand quickly what types of new skills (and at what volume) are needed to make the new products or delivery processes that are in demand. By understanding how your business focus is changing, you will be in a better position to adjust your workforce accordingly.
Step 2: Identify who is in a critical role
For all organizations, this is a fundamental step, not only to help you determine who you need to keep, but also valuable when trying to assess where you need to shift resources.
One consumer health division of a large multinational organization, for example, is using data analytics to source the best matched talent from a global talent pool to support production of medical devices in aid of the COVID-19 response. Another health organization is using their data to identify staff members who can operate ventilators so they deploy them to hospitals that need them. By gaining visibility into employee profiles and talent data, they can make better decisions to shift resources to new areas of the organization.