Why long-term human resource planning is becoming ever more important

The global coronavirus pandemic is creating extreme unease in many companies. Ultimately, it’s about naked financial survival in many cases. From one day to the next, the focus shifted to different priorities: employees’ health, new or redrafted statutory requirements and the most efficient, cost-optimized return possible to some kind of new normal after the lockdown. But the unease continues. There is the likelihood of a second wave and a renewed setback for the economy as long as the pandemic has not been effectively brought under control. Companies must therefore be able to respond in a highly flexible manner to sudden adjustments in order to maintain orderly business operations – even in tough times. But how is it possible to plan flexibly when we are constantly beset by uncertainty and unpredictability?

The focus of personnel planning must change

The answer can be easily summarized. The focus of workforce scheduling must be changed. Rigid shift models and schedules with unwavering requirements are no longer contemporary or appropriate. This has nothing to do with the pandemic but with the evolution of markets in general. Volatile order books, rapid economic cycles and short product life-cycles are the reality and require digitized, strategic planning. And this is called for across all sectors, whether production, retailing, logistics, service providers or the health sector. All too often, companies only act on an operational level – long-term personnel deployment planning doesn't get a look in. But in fact, this can deliver enormous competitive advantages.

Strategic capacity planning creates flexibility

The last few years have seen a lot of changes. Paper slips, pens and blackboards have been replaced in many cases. But is this enough? Particularly in volatile times, it's important not to lose sight of the long-term perspective in personnel planning. Although planning for a few weeks or months ahead is much more specific and less abstract than a complex plan for the year, some important factors may be ignored. Strategic capacity planning creates significantly greater flexibility. Overstaffing and understaffing can be recognized well in advance and appropriate measures proactively initiated such as an adjustment to the holiday quota or cross-departmental employee deployment. Order peaks or troughs can be well cushioned, and sudden, expensive responses such as the deployment of temporary staff can be dispensed with.

Demand and capacity must be matched

Let’s go through the whole process in a specific example. How do I know whether there is overstaffing or understaffing in my planning period? One necessary prerequisite for answering this question is to compare my demand and my existing capacity. Demand can either be extrapolated from the past, imported from existing systems such as the production planning, inventory control or order management system or actively determined with a software application such as the ATOSS Staff Efficiency Suite. I then compare my requirements with the available capacity. Specifically: the available employees.

Strategic planning requires maximum data transparency

If we examine these two sets of data, we can detect the first mismatches. Additionally, employees are not always available as desired. They may be on holiday, sick, taking part in further training, etc. We therefore take account of the absence rate to enable us to predict a realistic supply of capacity for the future. Ideally, we will be using realistic figures such as an existing sickness rate or further training quotas from the past. Now we should have a well-founded basis for our data on final overstaffing or understaffing.

This transparency creates the platform for taking early, strategic action. We can encourage cross-departmental deployment, give staff further training at an early stage, adjust the annual planning by raising or lowering the holiday quota, change the personnel structure or match weekly hours flexibly with demand. As a result, demand, personnel deployment and also costs will be well balanced over the longer term. And ultimately, we achieve something that is of enormous importance today for companies and employees whether in good times or bad: maximum flexibility in the area of working time.