Are You Hiring Well? You Need a Workforce and a Headcount Plan

August 13, 2021

When it comes to hiring, can you answer the following questions?

  • Do you know WHO to hire and by WHEN?
  • Do you know the TALENT GAPS that will derail your goals?
  • How does your company decide physically WHERE to hire the best talent?

If your answers to the above questions did not flow easily or did not inspire confidence, do not worry. Many companies are in the same position, thinking about hiring in a reactive way.

But you can create value for your company by incorporating a workforce and a headcount plan into your broader business strategy.

Workforce Planning

A workforce plan takes into account company goals and the talent needed to achieve those goals. Different goals will require people with a variety of skills and experiences.

Workforce planning asks leaders to look at their current teams, identify skill gaps and then make a plan for how to close those gaps. Closing the talent gaps typically include a combination of of the following talent strategies:

  • Buying – hiring employees
  • Borrowing – hiring contractors or consultants on an as needed basis
  • Building – succession planning and on the job training

You also need to consider how remote work can benefit your workforce plans and build in new geo-diverse approaches to hiring, benefits, compensation, engagement, development, and retention.

This type of planning should not happen in a silo, nor should it be considered a static plan. The best workforce plans are grounded in corporate goals and values, but agile enough to shift with talent, market, political, and social changes.

It’s best to include a diverse set of stakeholders in your workforce planning team including, human resources, recruiting, finance, executive management and trusted advisors from outside your organization who have deep industry knowledge.

Example WFP scenario:

  • Acme, Inc.’s current workforce is vendor heavy.
  • They are concerned about the security of their intellectual property (IP) given the higher percentage of vendors.
  • They decide that the best course of action is to shift the balance to 75% full-time employee (FTE) and 25% vendor in a two year timeframe.
  • They are currently headquartered in San Francisco, CA and have offices in Atlanta, Chicago, and Houston.
  • The majority of the vendor roles they plan to convert to FTEs are mid-level technical roles.
  • Based on market availability, they decide to split the hiring between San Francisco and Atlanta.
  • As a result, Acme starts to work on office plans, getting people managers hired, ensuring they have the right compensation guidelines available for each market, etc.

As you can tell from the above example, after you create your workforce plan there are a lot of next steps/downstream activities needed to ensure your new workforce will be successful and able to work on day one. Acme could have decided to move some or all of their engineers to 100% remote teams, which would have required a different set of next steps from team design, what each team works on, how they will stay connected, and more.

Headcount Planning

While workforce planning is about long-term planning and strategy, headcount planning focuses on a segment of the WFP. HCP takes into account:

  • Direction from the workforce planning process (who are we hiring?)
  • The finance team’s approved budget (how many people can we afford to hire and by when?)
  • Employee movement trends (attrition, transfers, acquisitions, re-orgs)
  • The recruiting team’s capacity to hire (what will it take to hire those people in that timeframe?)

The headcount plan is part crystal ball, part precise forecast – bear with me.

Crystal ball because you don’t know for sure how many people are going to leave your company, or how many people are going to transfer from one team to another leaving unaccounted for vacancies to fill on top of your budget net new positions. You also don’t know exactly how many offers will be accepted each month of recruiting activity because we are talking about humans, not machines. Humans are complex and each situation is unique.

That said, you can increase the precision of your headcount plan if you have access to the information such as:

  • Attrition rate
  • Transfer rate
  • Net new investment
  • Geographic disbursement
  • Offer accepts per recruiter
  • Time to offer accept
  • Time from offer accept to start date
  • Recruiting activities/channels and anticipated performance
  • Average onboarding/ramp time

*Bonus points for breaking out the above information by job role (ie sales vs software engineering), level, geography, etc.

Why you need both

Having both a workforce plan and a headcount plan ensures that you are being intentional about your company’s growth and ability to achieve key milestones and retain top talent.

A headcount plan without a workforce strategy is like setting out on a road trip without a destination in mind. It is exciting and fun, but you might not end up where you want.

A workforce strategy without a headcount plan l is like starting a roadtrip with a destination in mind but no idea how you’ll get there.

While road trips are fun, and I’m a big fan of hitting the open road, that’s not the best approach for growing a business and retaining your people.

Do you need help defining a workforce strategy and/or headcount plan? I can help create clarity for your teams.

Lauren Springer Consulting can help you evolve your workforce and/or headcount planning practices to deliver on your goals. Reach out to schedule a free discovery session with us today.




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© lauren springer consulting 2021


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