Win with Advanced Business Analytics: Creating Business Value from Your Data

PLANNING SHIFT

Once our operating model is spinning out business-related data, one of our first tasks is workforce planning. This topic has been given a great deal of attention in the last couple of years. The brighter minds in the business see that there are two fundamental changes taking place in planning. The first is recognition that strategic workforce planning is basically risk management. Some now call it human capital risk management (HCR). As such, it is part of enterprise risk management (ERM). Therefore, HR should have a voice in corporate planning. After all, very few corporate plans do not to some extent depend on human capabilities to carry them through.

The good news is that surveys are showing an increased appreciation for human capital risk (HCR). Yet when assessed against other forms of risk management, the people issues fall far down the urgency list. Typically, risk surveys show that HCR is effectively assessed in less than one-third of the responding companies. Effective HCR requires that factors such as labor availability, incoming skill levels, willingness to engage, and attrition rates must be translated into various types of business impact. The application of predictive analytics can be extremely useful in managing HCR.

My observations and experiences tell me that the industrial era, supply-demand, gap-filling model of planning is rapidly becoming obsolescent. Until recently, HR planners would be handed the business plan for the coming year and told to ...