Engaging in in-depth workforce scenario planning allows HR to approach developments and curveballs with greater confidence.

In a volatile labour market, HR needs to be proactive in planning for the future.

Over the past few decades, we’ve witnessed drastic changes to the world of work, from the rise of hybrid work to the impact of generative AI. As the pace of change continues to pick up, the coming years are poised to bring even greater disruption. 

This raises a difficult question for HR practitioners: how can we prepare workforces to succeed when we don’t know what tomorrow will bring?

While HR practitioners can never eliminate the elements of uncertainty involved in workforce planning, they can prepare businesses to better anticipate and respond to change by conducting regular and effective scenario planning. 

“Scenario planning is like a dress rehearsal of what the future could look like,” says Tanya Hammond FCPHR, Founder and Chief Collaborator at Tailored HR Solutions.

“We can’t solve every problem, but we can get a greater level of certainty in this turbulent environment we’re living and working in every day.”

Often, what holds HR back from embracing scenario planning is the sheer volume of possibilities to consider. To avoid feeling intimidated by the process or wasting time planning for unlikely scenarios, a thoughtful and structured approach is critical. 

To help guide HR practitioners in structuring their workforce planning, Hammond and her colleague Jaye Matheson, Chief Insights and Transformation Expert at Tailored HR Solutions, are facilitating AHRI’s new short courses in Workforce Planning, both foundational and advanced.

Below, Hammond and Matheson offer three ways HR can elevate their scenario planning to help build a resilient and future-ready workforce.

1. Use the PESTLE acronym for environmental scanning

Effective scenario planning requires HR to develop a deep understanding of the forces at play within the business that could impact the workforce, such as future skills needs and the organisation’s growth agenda. 

However, it’s important that HR practitioners don’t stop there.

“What we have often found is that there has been too much focus on, ‘Here’s our organisation, here’s our workforce, here are the trends within our workforce’ – so things like turnover and difficulty to recruit,” says Matheson. 

“What we really encourage at the beginning of these processes is thinking about, ‘What’s happening outside the organisation that could impact us on the inside? What’s happening in the context around us?’”

To gain a well-rounded understanding of internal and external factors that could impact the workforce, Matheson and Hammond recommend using the PESTLE model, which prompts HR to consider political, economic, social, technological, legal and environmental factors. 

See some examples below:

This model not only helps HR practitioners consider a wider range of trends, but also allows them to present the information back to the business in a more digestible way. 

During the process, it’s often useful to start by looking at observable trends within the business and then ‘zooming out’ to identify external trends that could be contributing to them. 

“For example, within an organisation, they might have pain points and say, ‘We know these roles are really critical, but they’re hard for us to recruit,’” says Matheson. “If we zoom out and we look at that across Australia, and across industries, there may be widespread skill shortages and shortages in the number of people being educated in those occupations. Zoom out again, and there’s Asia Pacific shortages. 

“Oftentimes, bringing those insights to leaders will help them gain the perspective that these issues are bigger than us – so we really do need to start to do something differently.”

When it comes to gathering data corresponding to each of these areas, they recommend the Australian government’s Jobs and Skills website as an invaluable resource to inform workforce scenario planning. The site includes an ‘atlas’ of live labour market data, as well as acting as a hub for market news and research. 

The CSIRO also offers research and resources to support workforce planning, and can be a great ‘zooming out’ tool, since it offers detailed context for trends both in Australia and globally.

2. Use the bookends method to map scenarios

In conjunction with environmental scanning, HR should also be assessing the level of impact each identified trend could have on the workforce.

One of the tools Matheson and Hammond use to help HR practitioners do this is the ‘bookends’ method. 

This approach involves taking a trend, such as the proliferation of AI, and mapping a range of possible futures it could create for the organisation, from the most extreme to the most conservative. This creates a visual ‘scale’ of possibilities, allowing HR to decide where on that scale their organisation might sit.

Using the example of AI, on the higher end of the spectrum, HR might look at how leading organisations are leveraging cutting-edge iterations of this technology to completely reshape their business model, or consider emerging AI trends such as digital assistants and how these could develop over time.

“We can’t solve every problem, but we can get a greater level of certainty in this turbulent environment we’re living and working in every day.” – Tanya Hammond FCPHR, Founder and Chief Collaborator at Tailored HR Solutions

On the lower end of the scale, HR might consider the legal and regulatory frameworks that could come into play in the coming years, potentially holding employers back from AI and digitisation.

AI’s impact on any organisation will almost certainly fall between these two extremes; by assessing the individual business context to estimate where on the scale you might land, you can plan for this scenario while still having visibility over more extreme possibilities.

“Then, you can say, ‘Alright, if this is the scenario that we’ve landed on as the most plausible, what is that going to mean from a capability perspective?’” says Hammond.

“You might then build some assumptions that say, ‘We will be adopting artificial intelligence at X rate,’ and decide what that means for your workforce.”

3. Find your workforce ‘mavens’

Large-scale collection and analysis of workforce data is a critical component of workforce planning.

Gathering accurate information to assess internal and external business contexts is more complex than pulling data from an HRIS; it requires HR to actively build connections with the right people. It’s essential to tap into the insights of people who have a deep understanding of the internal workings of all aspects of your business. 

Matheson and Hammond refer to these individuals as your ‘mavens’. These are stakeholders who have a wealth of knowledge about the workforce and – crucially – are willing to share it and participate in workforce planning. 

“For example, who are the people that are really curious about social change? Who in your networks and in your workplace is really interested in technology? Who’s a bit of a nerd around legislation and politics? Start to build relationships and conversations with those people,” says Hammond.

“It’s developing those networks with the right people who have curiosity around these things that really sincerely helps us. Surrounding yourself with people who are curious is a really healthy tactic.”

Don’t go into these conversations blind, she says. Do your homework first and decide what insights you can bring to the table to create a two-way dialogue. This will not only make the conversation more productive, but also position HR as a knowledgeable, trusted partner to the business. 

When gathering input from different parts of the business, it’s also important to assemble groups with diverse backgrounds and thinking styles to conduct workforce planning.

Hammond cites Edward de Bono’s concept of ‘Six Thinking Hats’ to illustrate an optimal mix of minds and perspectives. The idea is for different people to enter a discussion with a specific area that they intend to focus on and advocate for – in other words, a specific ‘hat’ to wear. De Bono’s six hats include the ‘process’ hat (blue), the ‘creativity’ hat (green) and the ‘cautions’ hat (black).

These hats don’t necessarily need to correspond to a person’s role or personality. Those wearing the black hat are not chosen because they’re a negative or pessimistic person, but because they understand the risks and limitations of the concept being discussed and have been nominated to advocate for them.

“You can assume different characters. So the black hat person says, ‘This might not work,’ and the green hats think really expansively and creatively, and you’ve got all of the different thinking styles in between.

“You don’t want a bunch of only innovative or creative people, because we always need to do a bit of reality checking.”

These discussions should never be seen as ‘one-and-done’, adds Matheson; particularly in a volatile world, scenario planning should be a dynamic and active process.

“If practitioners get into a cadence of making that a regular practice, it builds business acumen and the confidence to have conversations with leaders and understand what workforce issues mean in their context,” she says. 

By turning scenario planning into a collaborative effort, HR can ensure all functions of the business will be able to approach future advancements and unexpected shifts with more curiosity and confidence.

Learn more tools and frameworks to conduct workforce scenario planning by joining Tanya Hammond and Jaye Matheson for AHRI’s Foundational and/or Advanced Workforce Planning short courses. Discover practical approaches to environmental scanning, demand forecasting, labour market analysis, stakeholder communication and more.