Human Capital Planning Can be a Workforce Optimization Tool

Often referred to as Workforce or People Planning, Human Capital Planning (HCP) is seen by many as purely a budgeting process. However, it can be a strategic tool.

Nearly all organizations can substantially improve how they measure and monitor workforce-related risks as part of HCP.

In most organizations, there is an opportunity to increase collaboration between Finance and HR to elevate the value of the HCP process. A collaborative HCP process involving finance, HR, and the business can be a staff retention, development, and succession planning strategy considering turnover risk, performance, career progression, and succession metrics.

Optimizing the process involves determining the ideal blend of planning at the named employee level for key positions and at the headcount level for entry-level or high-turnover positions.

Adding to the complexity, organizations are relying more on external talent like professional firms, contractors,
and interns to achieve strategic objectives.