People are the single largest business cost in 95 per cent of organisations. This outgoing is not just impacted by headcount but by salary, recruitment rates, automation, departmental structures and retention. Given the significant cost of personnel to a company’s bottom line, it’s therefore crucial that the HR function is equipped to optimise its workforce planning and do so based on contextual evidence.
A new report by CIPD and Omni found that only 46 per cent of employers use data to identify skills gaps in their organisation, leaving businesses more exposed to outside risk factors as well as potentially missing out on opportunities for improvement.
The value of workforce planning
Workforce planning is a data-driven method of hiring and planning for the future and it helps HR to deliver its capability in an organisational context. With the application of workforce planning the HR function is able to:
- Predict future workforce needs
- Understand gaps in the workforce
- Reduce costs
- Improve productivity and quality of work
- Create employee reward initiatives
- Strike the right balance between different types of employees – e.g. full-time, remote and contractors
- Recruit with confidence
- Easily adapt to change
Where does business partnering come in?
A HR team may well be carrying out these activities as part of their everyday workforce planning processes. But if they are doing so in silo to other strands of the business, they will likely miss out on valuable context that can feed into improving the way they operate.
Business partnering is when a dedicated ‘business partner’ from a specific function – for example finance – builds meaningful relationships with key members of certain leadership teams in the organisation. The business partner will regularly consult with them, making sure that outside factors (business strategy, policy changes, economic events) are factored into their planning. It’s a form not only of risk management, but of ensuring that the business unit is aware of all opportunities to position itself for success.
When Financial Planning and Analysis joins forces with HR
Today, the Financial Planning and Analysis (FP&A) department has more opportunity than ever to go beyond the core financials and strategically partner with HR to develop a workforce strategy that drives better business results.
The dedicated FP&A business partner will ask themselves: “What can I find in this data that will help the business make better decisions?” In theory, every part of the value chain of an organisation carries opportunities for a FP&A business partner to use the insights they have gained to drive tangible results.
How can a finance business partner add value to your workforce planning process?
A Financial Planning and Analysis or finance business partner is able to deliver a multitude of benefits to the HR function’s workforce planning, helping it to:
- Align strategic planning with head count and talent planning
- Create a view of talent supply and demand issues by expense area, reporting relationship, and location
- Provide managers with reports and tools to determine the impact of their talent decisions and prioritise future workforce investments
- Provide leaders with the right metrics: identify talent risk before it impacts business objectives
- Control unplanned talent costs and highlight issues that limit employee productivity
- Build competitive advantage through planned versus reactive talent management
- Give leaders consistent reporting of results to measure and quantify outcomes
- Develop a strategic roadmap that’s aligned to and has the potential to shape the overall strategy
- Determine what investment will be required to implement the workforce plan
- Understand the impact of changes in employee numbers on operating expenses
- Define critical roles and the organisational structure
- Recognise the impact of various workforce scenarios on product and service margins
What are the key traits of a successful business partner?
An effective business partner understands the business model in depth: how it operates, how it creates value, its strategic drivers and its purpose. They are someone who is able to make connections between people and issues. During decision-making meetings they will be sitting at the table brokering and linking up points, adding their overview.
Influencing, emotional intelligence and communication skills are particularly important for business partners when it comes to building relationships with department leadership teams. An effective business partner is able to challenge managers and hold a mirror up to the business, spark discussion and question assumptions, sometimes needing to recognise and overcome resistance from areas of the business.
An important aspect of their work is in generating insight from data: using and applying evidence to support business cases or strategies. A good business partner will examine the right questions, identifying opportunities to create the most value. The business’ leaders and other key stakeholders need to be engaged and consulted so that they understand the value and opportunity of the business partner model.
Business partnering in your organisation
In building out your business partnering staff and strategy, efficiencies and capabilities should be critically assessed to decide how the BP model can be applied within your organisation’s unique setup. Once in operation, it’s vital to carry out ongoing evaluation of the business partnering model to ensure that your HR services are maximising opportunity for the business.
How Morgan Law can support your team through the hiring process
At Morgan Law we understand the importance of planning for the future. Speak to one of our specialist recruitment team to learn more about how we can support with your talent acquisition strategy.