Table of Contents

I. Introduction
II. What is workforce and succession planning?
III. Workforce Planning Model
a. Leadership buy-in
b. Considerations
c. Identify Scope
d. Demand Forecast
e. Supply Projection
f. Gap Analysis and Prioritization
g. Data Analysis
 h. Solutions
     i. Recruitment/Selection
     ii. Retention
     iii. Staff Development
     iv. Knowledge Transfer
i. Implementation, monitoring, evaluating, improving

I. Introduction

The State of Arizona, like many other public and private employers, has a history of significant workforce challenges in recruiting and retaining employees. Managers know too well the time it takes to fill positions and retain staff. This is particularly true in certain fields. Increasing turnover and increasing competition for a limited pool of quality candidates requires managers to take workforce and succession planning to the next level. Human Resources’ role is to assist managers in creating an individualized workforce and succession plan that fits the unique needs of the agency.

In 2006 National Association of State Personnel Executives reported that more than half the states were predicting that at least 20% of employees would be eligible to retire by 2011. The State of Arizona has its challenges with more than 50% of its employees at age 45 or older and with some agencies anticipating nearly 40% of its workforce eligible to retire. With certain industries already experiencing the highest separation rates, such as nursing, correctional and social services, this increase in retirement eligible employees will have an even greater impact.

To successfully compete with other employers for quality employees and retain our high-caliber employees the State of Arizona must act now. Rather than gathering data and summarizing it only to support a specific request or defend a position, the State must utilize this information to plan for the future.

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II. What is workforce and succession planning?

Workforce planning determines the human resources needs required to meet the goals of an organization. It is often summarized: the right people, in the right place at the right time. It is planning for a workforce that will be able to accomplish the strategic direction of the agency.

Succession planning is identifying successors for future vacancies. Some organizations concentrate on identifying and grooming replacements for only high-level positions. Other organizations identify key positions to preserve and enhance institutional knowledge, learned from experience. The level in the organization is not at issue.

Workforce and succession planning are linked and should be thought of as a continual process. Workforce planning, based on the strategic plan, involves setting the direction, obtaining data, and setting priorities. Succession planning, based on the established priorities, involves identifying the position(s), developing solutions, implementing solutions and monitoring and evaluating its impact on the workforce plan.

Workforce planning is a process that begins with an organization’s strategic direction.  Before developing a roadmap, managers must know where they are going.  The strategic direction sets the stage and takes into consideration customer expectations, new legislation, technology changes, and the external environment.  It requires managers to obtain data (current and future), and set priorities.

Succession planning is based on an organization’s priorities.  Once these priorities have been established human resources can assist management with gathering pertinent data.  What are the related issues?  It may be a recruitment issue or a retention issue.  The organization may have concerns with knowledge management or staff development.  One size does not fit all and needs to be tailored to the agency or unit.

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III. Workforce and Succession Planning Model

a. Leadership buy-in

Reviewing the State’s information regarding employee retirement eligibility, the disturbing high turnover in some of our most critical classifications, and the difficulty to fill certain positions supply ample ammunition when selling workforce and succession planning. However, getting managers excited about a career-long problem is difficult. Asking them to carve out time to strategize about potential vacancies may be a hard-sell, particularly when managers are so inundated with day-to-day transactions.

Obtaining leadership buy-in is the essential first step when developing workforce and succession plan. Human Resources, utilizing its data, must build the business case for workforce and succession planning. Providing leadership comparative, pertinent data brings focus to the problem-without the right people, in the right place, at the right time, our organizations will not perform effectively.

After leadership support is obtained, the next step is marketing the plan to the management team. Personalizing the data to a specific organization and communicating that each solution is unique are the keys to victory. This sales pitch can include organization specific data regarding such things as turnover, the aging workforce, retirement forecasting, labor market forecasting, retention statistics, economic indicators, etc.

Once managers are “sold” on the value of workforce and succession planning, they need to be introduced to the next steps in the model.

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b. Considerations

The strategic plan of the organization has the biggest impact on the direction of the workforce and succession planning initiative.  The strategic goals established guide the workforce needs.  Additionally, management must not ignore customer expectations, legislation, technology changes, and the external environment on its effort.

• Is technology changing?
• Will changes in the economy impact services?
• What are employee expectations? See historical statewide employee satisfaction results (Arizona State Government Employee Survey Historical Trends)
• How does my agency compare with other agencies?
  

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c. Identify Scope

Identifying the scope of the effort is critical.  What is the extent of this effort?  Will the organization focus on individual positions, certain classifications or a classification series.  Will it be geared to the entire organization, division, unit or position?

Scope may involve:

• Individual positions, certain classifications or classification series. Perhaps the agency continues to face problems with a particular classification. The focus is turned towards this particular classification, e.g., nurses.
• The entire organization, division, unit, or a specific office. Perhaps the agency begins with an office, learns from the initiative and then begins focusing on a classification throughout the organization.
• A special project as part of the strategic plan or operational plan. Attention may be focused on a special project. Without the right people on the project, goals will be difficult to meet.

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d. Demand Forecast

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e. Supply Projection

The demand forecast outlines the types of people – the competencies, knowledge, skill and abilities and/or titles that will be needed and the number of each type/title needed by function.  Supply projection involves the current workforce—the employees’ knowledge, skills, abilities and competencies—the current workload and the availability of candidates.  Comparing the current employees’ skills with the future needs allows management to identify what gaps exist. 

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f. Gap Analysis and Prioritization

Gap analysis requires management to compare the workforce demands to the workforce supply projection.  Based on this analysis, gaps and surpluses in staffing levels and competencies needed for the continued effective performance of the organization should be identified.  If gaps are identified, management must determine which gaps have the biggest impact on the organization’s ability to achieve its goals and determine what solutions will be implemented.  If a surplus is identified, management must review the employee skill sets that will no longer be needed and develop strategies to address the situation, e.g., transfers, retraining or natural attrition, etc.

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g. Data Analysis

Depending on the situation, data analysis of the specific challenges must be conducted.  If there is a gap, reviewing recruitment data, retention data, turnover, length of service, retirements, etc. will allow management to make informed decisions and individualized solutions.  See the ADOA Human Resources Division’s 2007 Advisory Recommendation @ http://www.hr.state.az.us/Homepagelinks/2007_Advisory_Recommendation.pdf for information regarding turnover and salary data. 

Also, see the ADOA Human Resources Division’s 2007 Workforce Report @ http://www.hr.state.az.us/Homepagelinks/2007_Workforce_Report.pdf for information regarding various employment statistics.

ADOA Human Resources Division’s Employment offers a wide variety of survey services.  For a complete listing, please see http://www.hr.az.gov/HR_Professional/HRP_SurveysAnalysis.asp.

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h. Solutions

Key to resolving issues is the individualized assessment conducted during the data analysis phase.

Potential solutions may include recruitment, retention, staff development and knowledge transfer. After completing data analysis, one solution may stand out above all others. For example, one organization’s issues may require it to concentrate on a specific solution, such as retention. Another may face challenges in the area of recruitment or knowledge transfer. Still yet other organizations with a surplus of employees may be challenged with re-training employees. There is no one right solution. And although there may be a specific challenge, no organization can focus on one area while ignoring others.

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                i. Recruitment/Selection

Recruiters must be creative in the search for qualified candidates.  Increased participation in job fairs, college fairs, and recruitment at professional associations are common practices.   Some untapped resources may include local religious organizations or school parent associations.  Even prior to looking for employment, individuals relocating to a new area may first establish religious connections and register children in school.  Other standard recruitment tools include advertising and marketing.  The State of Arizona has developed its brand and web page www.azstatejobs.gov and shared resources to optimize its advertising efforts. 

• What strategies have you considered to fit agency unique needs?
• Refining selection utilizing Hiring Gateway screening tools.
• Utilizing the ADOA job fair, job boards and Hiring Gateway.
• Consider underfills to develop employees’ skills.
• “Growing Your Own” through the use of internships, both paid and non-paid.
• What have other agencies established to address similar recruitment challenges?
• Detailing an employee to a position prior to the employee obtaining the full complement of required skills.
• Mobility assignments allow state service employees to be placed in exempt positions, allowing them to maintain rights back to a covered state service position.
• Developing partnerships with community college training programs.
• Another source for “new” hires is rehiring retirees.
  • Retirees, whether from State Service or another employer offer an employer a large population to choose from.  With the growing number of boomers approaching retirement, employers can not ignore this potential recruitment source.

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              ii. Retention
Retaining our knowledgeable employees is going to become more difficult.  Retention is influenced greatly by salary and career growth.  Challenges occur because salary and career opportunities are not always under management’s control.  However, these challenges can be mitigated by making employees happy in other ways.

• Alternate work schedules
• Telecommuting
• Enhanced employee services
• Other work-life quality initiatives
• Career ladders
• Orientation
• Salary adjustments
• Reassigning staff
• Reorganizing
• Restructure work
• The Golden Rule
  • Communication, job satisfaction, leadership

All these retention tools are under management’s control, particularly, “the golden rule.”

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             iii. Staff Development

Developing employees involves more than training.  A critical development tool is the performance evaluation when it provides constructive feedback on a regular basis.  The formal annual review is not the only opportunity to provide feedback and should not be the only feedback received by employees. 

Included in feedback sessions, employees should also have an opportunity to plan for their development.

To learn more about preparing a performance appraisal, See “How to Prepare a PASE” at http://www.hr.az.gov/HR_Professional/HRP_PASE.asp

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             iv. Knowledge Sharing

Knowledge transfer is one tool an employer can use to assist in the area of succession planning.  Knowledge transfer is an effort to share knowledge possessed by experienced employees.  In fact, knowledge sharing is a better description of this effort - knowledgeable employees sharing their experience with less experienced employees.  Although knowledge sharing/transfer is usually associated with succession planning, it can also be viewed as a retention tool.  Knowledge sharing helps the new employee become more comfortable in her knew position sooner.  This in turn helps all employees in the unit. (See Knowledge Transfer/Sharing – Developing Employee Transition Tools)

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i. Implementation, monitoring, evaluating, improving

Human Resources’ role is to guide the organization toward an individualized workforce and succession planning initiative.  Every effort should be made for organizations to get started.  Efforts should be tailored to meet the organization’s needs.  Continued effective performance is reliant upon competent, knowledgeable staff.  If organizations do not begin to take proactive measures to meet the staffing challenges on the horizon, performance will suffer.

The key is to begin.  Start small.  Focus on a key area for the organization.  Obtain benchmark data, monitor the solutions implemented, evaluate the success and make necessary changes to improve the process.

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