Headcount planning is a common practice that helps organizations forecast and prepare for future staffing needs to sustain business growth. Effective headcount planning requires not only forecasting what roles may exist in the future but also understanding what skills are required to fill these roles. While it may not seem obvious on the surface, learning and development (L&D), with its focus on enhancing employee skills, plays an integral part in helping organizations effectively prepare for future headcount.
This article takes a closer look at headcount planning and the role L&D plays in delivering the right employees with the right skills, right when you need them.
What is headcount planning?
Headcount planning is a strategic process that HR professionals use to forecast talent needs to achieve business objectives. An effective headcount strategy takes a comprehensive approach to planning, addressing both immediate and future staffing requirements.
For forecasting accuracy, headcount planning should:
- Identify areas of opportunity for upskilling or reskilling employees to meet future staffing needs
- Consider key employee metrics including turnover, growth and average tenure to accurately predict staffing trends
- Recruit input from various departments and organizational levels to thoroughly understand staffing needs
- Operate within an established labor budget to ensure you have sufficient funding in place for annual reviews
Before you can make a reliable headcount forecast, you’ll need to conduct a headcount analysis by gathering data on employment trends and patterns. While it’s possible to do this manually, most modern businesses rely on software to automate the forecasting and analysis process.
5 key benefits of headcount planning
Your workforce is not static — it expands and contracts, and changes course based on market needs. Headcount planning allows for a proactive approach to HR and builds flexibility into your human strategy. Regular assessment of potential job openings helps you better plan for external recruitment as well as the L&D needed to fill roles from within. This vital exercise informs HR and L&D strategy for managing these market changes and hitting key business goals by:
- Enabling strategic alignment between talent and organizational goals
- Helping to manage labor costs by making sure that workforce plans are within budget and allocated appropriately to meet business goals
- Providing a cash flow roadmap, which is especially helpful for managing seasonal workers or bringing on temporary project-specific team members
- Supporting succession planning by identifying and planning for key roles that need to be filled, especially those in leadership that might require more advanced skill sets
- Identifying current and future staffing needs, which highlights skills gaps and provides L&D with clear direction for developing inside talent to fill these gaps
The intersection of headcount planning and L&D
Developing a plan is only powerful if you have the levers needed to execute it. That’s where learning and development (L&D) comes in. Having an L&D strategy in place ensures that your employees have the resources they need to succeed in their current roles, as well as to upskill and reskill into new positions. This is integral to the headcount planning process because it allows you to better understand the capabilities of your current workforce and how future openings can be potentially filled from within.
Let’s dive a bit deeper into three ways L&D and headcount planning go hand-in-hand:
- Identify skills gaps
Regular headcount planning allows HR and L&D professionals to examine the difference between current workforce representation and the skills they will need to meet future demand. This data should be used to inform L&D initiatives and ensure employees have all the resources they need to develop these skills now and in the future.
- Fill future job openings from within
Headcount planning can also shine a light on critical roles, such as those in leadership, that will need to be filled in the future. L&D plays an integral role in helping to supply an internal pipeline of high-potential talent that has the right skills to address these needs.
- Cross-train to improve workforce agility
Unforeseen disruptions can throw headcount predictions wildly off course. That’s why it’s important to incorporate cross-training practices into your L&D strategy so that employees can step into any number of roles if the need arises. While this may not be possible for areas of the business that require highly specialized expertise, there are likely job functions that rely on more general skill sets. With this strategy in hand, even greatly unanticipated circumstances can be addressed quickly.
Make headcount planning a priority
By itself, headcount planning is a powerful practice. But when supplemented with the power of L&D, your headcount planning strategy becomes even more effective — allowing you to stay ahead of the curve and strategize your workforce for greater business flexibility and preparedness.
Discover more L&D resources: Download this step-by-step guide for how to take quick action on skills development for your workforce and fast-track results.