The workforce is changing at a faster rate than ever before. Dramatic changes in how the world works through artificial intelligence (AI), hybrid work models, and shifting employee expectations are redefining how organizations operate. For many companies, the challenge isn’t just finding people, but it’s about aligning them with business goals.
Building your workforce strategy? Leverage benchmarks
That’s where workforce strategy comes in. A well-crafted people strategy ensures that an organization has the right skills, structures, and people in place to deliver on its objectives. With so much disruption to the workforce, it’s well and truly become a core component of the overall business strategy.
A workforce strategy is the plan that aligns an organization’s people capabilities with its strategic objectives (set by the management team). It often involves hiring plans, employee development, retention, leadership, and succession planning.
A well thought out strategy is designed to ensure the workforce is prepared for both current and future needs of the business. Here is a simplified definition:
A workforce strategy is the plan that ensures an organization has the right people, with the right skills, in the right roles, at the right time, to achieve its current business goals.
The workforce strategy is not to be confused with workforce planning or HR strategy. We’ve outlined the differences between these three items below:
While all three are related, workforce strategy is distinct in its emphasis on making sure that the business has a plan to maintain and acquire the talent that it needs to succeed.
A strong workforce strategy typically involves a blend of data, foresight, and human insight. The following components often form its foundation:
This involves analyzing the current workforce, forecasting future needs, and identifying potential gaps. It helps organizations anticipate demand rather than react to turnover or skill shortages. This analysis must be performed before the strategy can be developed.
Recruitment is always critical and retention strategies, from career development to employee engagement, are equally important for maintaining institutional knowledge and reducing turnover costs. Do you recruit in-house or use outsourced agencies? Do you know the number of new hires per recruiter and average employee tenure?
Upskilling and reskilling programs are important to address the shifting demands of specific skills. A workforce that is continuously learning is one that is agile and ready for the future. The key thing to know here is the average L&D / training spend per employee.
A workforce strategy that prioritizes DEI ensures varied perspectives, fosters innovation, and reflects customer demographics. Inclusive hiring, fair pay, and equitable progression opportunities often make a significant difference.
Data enables smarter decision-making. Benchmarking against industry peers provides valuable insights into performance metrics like turnover rates, employee engagement, or internal mobility, helping organizations identify how they stack up. CompanySights has a wide range of workforce benchmarks to develop your strategy - Search here.
Building a leadership pipeline ensures business continuity. Effective succession planning prepares internal talent for future leadership roles, minimizing disruption from retirements or departures. This is especially important for the CEO, CFO and COO roles.
Technology from predictive analytics tools to AI-powered recruitment platforms is improving the workforce planning process. A modern workforce strategy will have this as a strategic priority, and integrate these HR tools to improve agility and insight.
Now that we have a good grasp of the components that make up a workforce strategy, let’s turn it into action. Here are five steps to follow:
Start by collecting data on your current workforce. This involves information about headcount, roles, demographics, performance, and skills. The key data source will be from your employee database, such as Workday or SAP. If you’re part of a larger organization, then you may need to collect data from multiple systems. Always check that the data is accurate and up to date before moving on to the next step.
Align with business leaders to anticipate what people capabilities are needed to achieve strategic goals over the next 3 to 5 years. Consider things like emerging technologies, plans to enter new markets, and evolving customer expectations. To craft an effective workforce strategy, you will need to have a solid grasp on what the future of your organization looks like.
Compare the current workforce capabilities to future needs. This step will help to identify shortages in skills, experience, or capacity. Another useful tool is to leverage benchmarking data, which can help to validate whether gaps exist in the current state.
Address the identified gaps through targeted interventions, such as hiring, reskilling, reorganization, or outsourcing. This step requires careful consideration, so make sure to be well prepared and communicate the chosen rationale clearly across teams.
The workforce strategy is not a “one and done” exercise. Regularly track outcomes and adjust plans as market conditions and business objectives evolve, which is usually between three and 12 months.
Benchmarking allows organizations to measure their workforce metrics against peer organizations or industry standards. It is a particularly useful tool when developing your workforce strategy, as it can reveal where you’re organization stands today and what it could look like tomorrow.
Here are some common benchmarks that can help to prepare the workforce strategy:
These metrics, when compared over time and across industries, help organizations identify patterns and prioritize strategic initiatives. Benchmarks are very useful for forecasting workforce requirements in future years based on expected growth.
For example, if an organization expects to increase revenue by 50% over three years, they could source benchmarks for organizations already at that larger scale to understand what they will likely look like when it comes to functional headcount. The question then becomes how you are going to get there from where you are today.
Explore benchmarks to develop your workforce strategy
Let’s look at how different organizations apply workforce strategy principles in the real world. Please note that these three examples are only for a subset of the workforce.
A global tech firm identified a growing need for AI and machine learning expertise. Instead of hiring externally (at high cost), it launched an internal reskilling program that trained its software engineers in data science and machine learning. Benchmarking data showed that its upskilling investment per employee exceeded industry norms, but resulted in higher internal mobility and lower attrition among technical roles.
A healthcare provider that marketed itself heavily on providing superior care faced a shortage of qualified nurses. By analyzing benchmark data, it found its nurse to patient ratio actually lagged behind industry standards. The organization used workforce analytics to redesign staffing models, introduced flexible schedules, and improved retention by introducing new benefits. The result was a reduction in overtime costs and improved patient satisfaction scores.
Facing an aging workforce, a manufacturing company implemented a succession planning strategy supported by benchmarking data. By comparing leadership readiness metrics with peer organizations, it accelerated talent development programs and filled 85% of leadership vacancies within two years with younger employees in the company.
These examples illustrate how workforce strategy isn’t a theoretical concept, but is a practical framework for addressing real-world challenges.
Even the best workforce strategies face obstacles. Here are some common obstacles and ways to address them:
Many organizations struggle with fragmented data across HR systems. The solution lies in integrating data sources and adopting unified dashboards that combine internal and benchmark data for a full view of workforce performance. The scale of this issue often increases with the size and complexity of an organization.
If workforce planning is done in isolation, it will be disconnected from business operations and unlikely to deliver value. Embedding HR leaders in strategic business discussions is the best way to ensure the workforce strategy supports revenue, innovation, and growth targets. This is usually in the form of HR Business Partners.
Without credible external benchmarks, it’s difficult to gauge performance accurately. Partnering with a trusted benchmarking data provider allows organizations to compare metrics across industries and regions, ensuring data-driven decision-making.
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Technological change and shifting labor markets can make headcount forecasting difficult. Scenario planning (which is where you test multiple possible futures), can make workforce strategies more resilient in an increasingly unpredictable world.
A workforce strategy requires sustained commitment. Engaging senior leaders early, linking workforce metrics to financial outcomes, and communicating clear benefits will help to secure “buy in” and maintain momentum during the strategic planning process.
The future of workforce strategy will be heavily influenced by emerging technologies, which will in turn effect other areas of the workforce. Here are the key trends to watch:
Artificial intelligence is transforming how work is being done and how workforce needs are being forecasted. Predictive analytics can now identify attrition risks, skills gaps, and future hiring needs with unprecedented accuracy. This has become the single biggest disruptor, and lever to increasing workforce efficiency in a competitive world.
Many companies are shifting from role-based to skills-based workforce planning. Instead of hiring for titles, they’re focusing on skill portfolios that enable greater agility in how work is assigned and talent is developed.
Advanced analytics and benchmarking are central to future-ready workforce strategies. Organizations that leverage data for continuous improvement will outpace those relying solely on experience or intuition.
Workforce strategy is increasingly tied to employee experience. Factors like culture, flexibility, and well-being are now key levers in attracting and retaining talent.
Digital talent platforms within organizations help employees to find growth opportunities internally, often improving retention and maximizing the value of existing skills.
A strong workforce strategy bridges the gap between business ambition and talent reality. It ensures the organization can grow, adapt, and innovate, no matter how the market evolves.
When powered by benchmarking data, workforce strategy becomes a measurable, data-driven function that drives business performance. Organizations that continuously align their workforce to strategic priorities are likely to have a superior workforce.
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