Workforce planning and analysis is crucial to staying on top of changing job roles and requirements as your industry, technology, and work environment shifts.
Once you’ve determined current needs and gaps, you have to closely integrate each phase of workforce analysis with strategic planning to ensure that future workforce capabilities continue to meet the companies needs and budget. This means timing your analysis in such a way as to ensure that it is able to keep up with and meet changing company needs.
3 Ways to analyze your workforce
Supply analysis evaluates current company workforce resources. This process is typically the easiest, simply because you likely already have the data and can easily collect and manage the analysis during regular cycles of workforce review. This kind of analysis answers questions like:
- Where are jobs
- How many people are performing jobs
- What is the employee-to-supervisor ratio? Is it working?
- What are the pay rates? Are they fair?
- Termination data (how many people, why, where did they go, leaving impressions?)
- Likely rate of termination/retirement
- How well do current employees fill current skills
- How much does it cost to recruit new employees?
- How long did it take to recruit new employees?
Performing a supply analysis as part of a quarterly review gives you an easy way to stay on top of your workforce, even as people leave, retire, and are promoted.
Needs or demand analysis centers around identifying changing trends such as technology, new employees, changing job roles, and changing market demands. Here, you focus on identifying trends to ensure that you are prepared to keep your workforce efficient and functional.
- How essential is each job?
- How many people will be needed in X time to fill this job?
- Can this job be consolidated with another job?
- How will new technology impact this job role?
- What technology can be integrated to make this job more efficient
- What skills/competencies/abilities will make this job most efficient?
- How does this job contribute to the company’s strategic objectives?
- How does this role contribute to the customer?
This type of planning is more about workforce evolution and changing your team and department to meet demand. If you expect that new technology will make certain aspects of some jobs irrelevant, you can plan to consolidate those jobs, and start training high performers to take on both.
However, because this type of workforce analysis takes the long-view, you can typically perform needs analysis once per year during end-of-year review. However, the more often technology changes inside your company, the more often needs analysis must be performed.
Gap analysis attempts to determine what is being produced and what is needed. It’s a simple process of comparing supply and demand. It’s fairly simple to determine where there’s a surplus or an unmet need, which you can tackle by hiring or restructuring. Gap analysis allows you to take steps to train employees with (soon to be) obsolete skills so that they can continue to contribute, offer new opportunities, and work to help your existing workforce remain with the company.
- Which technical or software skills are lacking?
- Is there too much output? Not enough?
- Which areas have decreased demand? Which have increased?
- Where do you expect to see vacancies in the near future?
- Which processes or methods require special skills? Are those being met?
Like Needs Analysis, Gap Analysis can typically be performed every 12-18 months to align with the strategic planning cycle.
Workforce analysis can help you plan hiring and recruitment, internal training, and company restructuring to reduce costs, optimize your workforce, and ensure that every internal need is met by a qualified individual.