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Workforce planning can be successful without being complicated


The process is the same for any size business in any industry. Workforce planning can be effective without sophisticated metrics or HR systems. There are generally people in the business who have capability and capacity  to undertake workforce planning. If needed, there is often external support available through your industry or in your region.

Start with the end in mind. Be clear about what you are trying to achieve by undertaking workforce planning. Articulating this will help you develop a tailored process and also provides the measure of success for the workforce planning initiative.

Building workforce planning into business planning helps to successfully retain staff and compete for workforce. Businesses that align strategic, business and workforce plans are better placed to identify current and future workforce requirements.  Aligning these processes also allows workforce decisions which respond to business or industry changes and opportunities as well as to identify business risks.

Engagement of key stakeholders is critical. Consultation with key business advisors or managers is part of effective workforce planning. Managers generally have the answers to workforce planning. Other key stakeholders can include employees and employee representative groups, such as unions.

Workforce planning supports the right workforce development initiatives. Workforce planning enables an evidence base for decisions about workforce requirements, in particular workforce development strategies.

A workforce plan is not a static document. It should be a live, active process supported with regular workforce insights and annual reviews in alignment with your normal business planning activities.

Workforce planning involves planning for the people who will help your business deliver its products and services to your customers. Similar to business planning, it is a continuous process of identifying the existing skills of your workforce (where you are now), desired future skills (where you are going), workforce gaps, and strategies and actions to close those gaps (how
you will get there). These strategies and actions can include training and development, recruitment and improving workforce performance.

Workforce planning involves five simple steps:

  1. Define your business goals and its operating environment for the desired timeframe.
  2. Know your current workforce — who they are, what skills they have, where they are located and what their plans are.
  3. Consider your future workforce requirements.
  4. Analyse and develop strategies and actions to fill any identified workforce gaps.
  5. Implement, monitor and review your workforce plan to make sure it is achieving what it was meant to.

The purpose of workforce planning is not to decide what you will do in the future, it is about determining what you can do now to be best prepared for the future. To maximise the benefits of workforce planning, it should be integrated into your business
planning. This will help to have the right people, at the right time and place, doing the right things to achieve your business goals.

These goals can range from growing or selling your business to simply achieving another successful year of operation.

Along with your business plan, your workforce plan will get you and your workforce ready to respond to any changes in your business environment.

Your workforce plan should be regularly reviewed as changes and challenges occur.

Fact Sheet 1 (PDF, 72KB) provides an overview of the four stages of workforce planning.

A good workforce plan will give you a solid understanding of your current workforce and how to prepare your workforce for the future.

Small business often relies on the knowledge and skills of key employees. The departure of any one of these employees (through resignation or retirement) can be costly and result in the loss of important business knowledge. New opportunities can also emerge for your business that require your workforce to change.

Workforce planning is important for small business as it can help position your business to be more resilient to economic, environmental, social and technological change. It also allows businesses to compete better for employees and skills, now and in the future.

Workforce planning that is integrated with business planning can help your business:

  • respond quickly and strategically to change, as business managers can recognise emerging challenges in the market, workforce and business
  • improve efficiency, effectiveness and productivity (your workforce possesses the right skills
    and are a good fit for the job)
  • plan for future workforce requirements (identify staffing needs in a timely manner, monitor
    turnover and ensure replacements are available to fill key vacancies)
  • engage your workforce, increase job satisfaction and foster goodwill through improved employee relations
  • build workforce skills to support business activities and achieve business goals
  • identify and manage people with the knowledge critical for effective and efficient business operations
  • plan for new and emerging skills or roles through specific recruitment, training activities or collaborating with other businesses
  • know who is in your workforce, what they do, the skills they have and the skills they need to develop or improve
  • identify where you are most at risk of productivity and continuity losses, and where you need to train employees to ensure you have a consistent supply of talent
  • identify whether or not you need to improve your retention strategies. If key skilled people are regularly leaving, how you can prevent this from continuing to occur?
  • link your workforce initiatives to your finance and business planning to ensure they are
    aligned to plans and budgets.

Your workforce plan should be regularly reviewed to ensure your business is well positioned to achieve its goals.

Undertaking workforce planning for the first time can feel like a daunting process. It doesn’t have to be. Workforce planning has proven to be successful in supporting businesses, regardless of size.

Things you will need to consider include:

  • What is your current strategy? The strategy of a business will provide guidance on its key functions and activities, including products and services to be delivered. This will be very important in developing your workforce plan as it will provide insights into your business goals.
  • Who will be doing this? Will this be the business owner, a manager or an external person?
  • Regardless of the size of your workforce, segmenting your workforce into different types of roles, functions and skills will help you best understand and focus in on the most important workforce aspects to your business.
  • What workforce information do you already have?
  • What workforce information can you collect relatively easily?
  • What is the best way to communicate to your workforce and stakeholders?

It is important to remember that workforce planning does not need to be complicated, but it does require thought and engagement with your staff.

It is important that you consider who should be involved in workforce planning for your business. Your workforce planning team is a core group who will be involved in the design, implementation, monitoring and evaluation of your workforce plan.

It is important to have commitment and support from your senior business leaders/owners to ensure that there is alignment between the workforce plan and the business direction. It is beneficial to include line managers and employees to capture their knowledge and input.

The key is to clearly define roles and responsibilities for workforce planning activities and to set realistic deadlines.

When bringing a team together, clarify how you are going to reach your end goal, as well as who is committed to making this goal happen.

Things to consider:

  • Who are your stakeholders, based on the scope and scale of your workforce planning?
  • What is their role in relation to workforce planning?
  • Who are the key decision-makers?
  • How can they be best involved and what time can they commit?


Suggestions on who to involve:

  • a diverse mix of management and employees that represent various business levels, functional areas and locations
  • line managers who oversee areas with critical hiring needs
  • line staff, including both new hires and those employees with more experience
  • a mix of age (including youth and mature age), gender, cultural background and declared disability
  • dedicated and knowledgeable staff
  • those staff with specific expertise needed to implement workforce plan – HR, IT, finance etc.
  • union representatives.

  Template 1 (DOCX, 47KB) will assist you to identify who you should include in your workforce planning activities.

Get started checklist

I understand:

what workforce planning is


why workforce planning is important to small business


who I should include when undertaking workforce planning


key workforce planning terminology


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