Anticipating the Future

Some forward-thinking companies use strategic workforce planning to identify and prepare for future workforce needs.


In the early 1990s, when much media attention to work/life flexibility was lauding the advantages of on-site day care, Johnna Torsone, senior vice president and chief human resources officer at Pitney Bowes, was surprised to find that most members of her workforce didn’t want it.

“In 1993, you had to have on-site day care to be a best workplace for working mothers,” said Torsone. So Pitney Bowes, a manufacturer of mail and document management products and services, decided to ask its 25,000 U.S. employees which work/life issues were important to them. “Only 15 percent said that on-site day care was important,” says Torsone. “A higher percentage wanted flexible scheduling for elder care. So we decided that in five years the need for elder care would be dominant. And we needed to make sure that leaders could manage around that.”

Torsone’s anecdote illustrates one principle of strategic workforce planning: forecasting the best tools to retain and attract the employees you want. But the concept of strategic workforce planning stretches beyond that into almost every aspect of the employment process.

“It means identifying and planning for your future workforce needs,” says Keith Greene, SPHR, director of organizational programs at the Society for Human Resource Management. “It encompasses recruitment, retention, training and development, downsizing, outsourcing and succession planning.”

Despite its seemingly amorphous and huge dimensions, however, some companies have strategic workforce planning down to a science—and are willing to talk about their best practices.

Here are the steps they use in developing a strategic workforce plan:

Look at current workforce capabilities. At Hitchcock Chair in New Hartford, Conn., where 120 employees work in manufacturing and retail, HR Manager Tracy Michaud used the software program Excel to inventory the skills of all manufacturing employees, from millwork through finishing. Hitchcock was running lean, and management wanted more employees to have a spectrum of skills.

“A few years ago everyone was specialized, so if one of our two table assemblers was on leave, and we had a lot of orders for dining room tables, it could be very hard,” says Michaud. She created a spreadsheet listing all the skills required at Hitchcock’s manufacturing facility and those possessed by each employee. Michaud then asked employees to correct the matrix to reflect any skills that may have been overlooked. Once the updated version was posted, Hitchcock put in a training program to develop everyone’s skills.

“Now everyone is a generalist,” Michaud continues. “So when a need arises, we can look at the matrix and say, ‘Oh, so-and-so knows how to do that—let’s get her over here.’ ”

Identify future workforce needs. This means determining where you want your organization to go, looking at demographic and industry trends, and deciding on the people your organization will need. At Pitney Bowes, company leaders foresaw a new computer age.

“About 10 years ago, we knew that our product mix would go from mechanical-driven to software-driven,” says Torsone. “We knew we would have to transition the workforce, so we looked at the customer service area and saw that we had to shift employees’ knowledge and skills from mechanical to software-driven. We told our customer service employees they would have to be certified in new, software-related skills, and then we funded the training.”

At Hitchcock, Michaud says, company leaders saw that retail furniture sales were going from a merchandise-driven to a customer-driven environment.

“We decided that our success was going to come from offering our customers design services, so we became a design-oriented retailer,” says Michaud. To move Hitchcock’s sales staff into design, the company offered a certification in home interior design through the Interior Design Society and conducted targeted training in design skills. “Some of our sales staff grabbed it and ran with it,” she reflects. “Other employees still saw themselves as sellers, so we grandfathered them in. But for our new hires, we’re focusing our selection on design skills.”

Look at demographic trends. The Bureau of Labor Statistics is forecasting a coming wave of baby boomer retirements, but at the same time, there’s also strong evidence that more older workers will want to keep working. These data suggest both that there will be a dearth of skilled workers in the years to come, and that employers will have to learn what it takes to retain older, skilled workers.

“So the question is, what do companies do?” Torsone asks. “How do we take advantage of the knowledge and experience of older workers and keep them refreshed?”

At Ann Arbor, Mich.-based Borders Group, Dan Smith, senior vice president of human resources, sees the coming wave of baby boomer retirements as a huge opportunity for the company.

“There are more baby boomers than 20- and 30-year-olds out there, so the question is, how do we attract the boomers?” he asks. “We’ve been building some benefit offerings to attract them. As everyone else is retreating from part-time benefits, we’re rolling them out—medical, dental, vision, optional long-term care—many of the things older people would need,” he comments.

At Hitchcock, Michaud has figured out how to challenge incumbent employees and keep them interested. “In our support departments—HR, accounting, marketing, customer service—we have only one person per department, with no career ladders,” says Michaud. “We knew we had to take a different approach to help people feel they’re growing. So we created something called a job addendum.”

A job addendum is a new set of responsibilities, voluntarily agreed on, that sends an employee in a new direction. One example, Michaud says, is a customer service employee who was doing a terrific job but was bored. “So we came up with the idea of sourcing independent interior designers to come into the store and help customers. This employee came up with a way to fit this new responsibility into his daily routine, and under his job addendum, we compensated him for the additional responsibilities.”

Michaud says Hitchcock currently has four such addenda active. “They’re an opportunity to help a person grow rather than lose them,” she concludes.

Compare present and future needs. At TJX, the nation’s largest off-price retailer, Assistant Vice President of Executive Development Sandy Pipitone says the company regularly conducts a sample talent gap analysis.

“This type of analysis asks for the head count for each position, forecasting those who will probably retire, move laterally and so forth,” says Pipitone. “From there, we get the total number of openings, and we factor in more because the company is growing. We discuss future business challenges and necessary skill sets to define success, and we ask who we have that meets those skills.

“We ask managers about high potentials in the creation of a development plan,” Pipitone continues. “We make sure that the individual understands and accepts the plan, and we identify clear, specific action steps for each area that are motivating to the individual. We agree on metrics and accountabilities and on a process to follow up and monitor progress against the plan.”

Borders invests heavily in its internship program as a way of growing managers. “We go to the three top-tier business schools in our region—Michigan, Indiana and Northwestern—and hire MBAs and BBAs,” says Smith, “and we tend to hire people who have been prior interns. The internship program gives us a chance to see people at work.”

Establish a permanent system. Make sure the organization continually monitors its needs, abilities, gaps and imbalances. Borders has a system of “talent relationship management,” which Smith defines as the management of talent into the company and throughout the organization. The system extends throughout the span of an employment relationship, from having the right web site to attract the right people; to identifying the right candidates; to assessing them, engaging them, identifying leaders and measuring retention.

“Our strategic planning for the company leads to our HR strategy, which in turn drives our hiring, performance assessment, engagement efforts and retention,” says Smith. At Pitney Bowes, Torsone says, company leaders have four operating reviews per year. “Each department regularly forecasts its coming skill gaps—it’s a joint project between the line management and HR,” she comments.

Use technology. Borders uses technology throughout its strategic planning process, from tracking demographics to identifying the right applicants.

“Our real estate and development department has software tools to analyze the demography of the ZIP codes around the stores,” says Smith. For example, within a five mile radius of some of Borders’ Los Angeles stores, the population is 90 percent Hispanic; in some stores in the District of Columbia, black; in places like Phoenix, it’s all retirees. “Our recruitment mirrors the community, and we use technology for that.

“Getting the right person is impossible without technology,” Smith continues. For hourly jobs, Borders uses an online application and applicant tracking system called Unicru, which assesses applicant skills; for management positions, a system called Psimax, which also provides online assessments. This technology enables Borders managers to search by candidate, by region—in short, to keep track of the process.

“There are lots of tools out there for narrowing down the candidate pool—that will make selection easier and better,” says Smith. “In a nutshell, we have no paper.”

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