Your 5 Step Checklist for Successful Headcount Planning

Feb 6, 2023
Reading time: 15 min

Headcount planning: It’s not just about the numbers. It’s about building a winning team that drives your business forward. Whether you’re a start-up just just beginning to build your workforce or an established company looking to expand, creating a strategic headcount plan is essential for success.

But before you start clearing off space on your trophy shelf, you need to build out the foundations of your headcount planning process. By having strategic steps in place, you can create and manage plans to help achieve your goals (like becoming the MVP of headcount planning) and build a strong organization.

What is Headcount Planning?

Headcount planning is the strategic process of creating and implementing growth initiatives for your employee headcount to achieve short and long-term goals . Simply put, it’s planning to hire people to meet your company’s needs.

Why is headcount planning so important? Because without a plan, companies have no means to sustain expansion or scale successfully.

Know the difference between workforce planning and headcount planning?

Learn the difference here

Potential Issues for Headcount Planning and Forecasting

Let's face it. Headcount planning can be a real pain. Not having up-to-date information makes the process complex, time-consuming, and more often than not, fall short of our expectations. In fact, according to a recent study, more than half of corporate executives don’t believe their business has strong headcount planning capabilities.

But why does this happen? The reason varies, but headcount plans often fail because leaders simply don’t have enough context to inform their decisions. To plan effectively, they need a full understanding of their current business, their people, and their goals. Without this knowledge and clarity, missteps happen, such as:

  • Ineffective forecasting. Leaders overshoot or underestimate how their company will grow. No “shoot for the moon and you’ll land in the stars” inspirational poster here – ineffective forecasting leads to budgeting issues, potential layoffs, or scrambling to find new hires.
  • Lack of agility. Leaders don’t account for uncertainty, like a recession or succession plans you needed yesterday.
  • Failed recruitment initiatives. Limited talent pools might hinder recruitment, or worse, lead you to hire the wrong people.
  • Attrition and turnover. People leave, especially if they’re hired for the wrong roles. You want your people to leave for the right reasons, like moving on to rule the world, instead of hiring issues.
  • Misalignment to business goals. New budgets, timelines, and product roadmaps can all throw a headcount plan off course without effective collaboration and clarity.

Don’t let the above pitfalls scare you. Instead, familiarize yourself with them so you know what to avoid moving forward. Combined with the five steps below, you’ll have everything you need to create a successful headcount plan of your own.

Your 5 Step Checklist for Successful Headcount Planning

Implementing the five steps below not only ensures a more successful headcount plan, but also creates a solid foundation for headcount planning for years to come.

1. Talk to Current Employees

To understand your business and its headcount needs, you need to talk to your employees. And that means everyone, not just department leaders and hiring managers.

However, it’s unrealistic to sit down and have 1:1 conversations with every single person, especially at the enterprise level. Instead, use surveys and other forums to collect feedback on aspects like employee experience, work-life balance, and workplace culture.

One simple way to gather employee feedback is through eNPS surveys. Like the standard net promoter score (NPS) survey used to gauge brand loyalty, eNPS surveys gauge employee engagement and satisfaction. Normally, these surveys ask employees to rank and describe their experiences on a scale from 1-10.

To inform headcount planning specifically, send out eNPS surveys that includes follow-up questions around hiring needs and work performance. For example:

  • On a scale from 1-10, do you feel like you have enough bandwidth to successfully do your job?
  • On a scale from 1-10, do you have the resources you need to be effective in your role?
  • On a scale from 1-10, do you have a clear sense of what your direct reports are owning?
  • On a scale from 1-10, as a manager, do you feel like you have enough people on your team to successfully meet your goals?
eNPS survey in ChartHop

Choose a platform that not only allows you to send out surveys, but also creates data reports to inform your decisions moving forward.

Pro tip: These questions should be different for individual contributors and managers. Managers are often at the frontlines of an organization. If they have consistent 1:1s with their team, give them a means to explicitly communicate how their team really feels. That way, executives have deeper insights into what employee sentiment might be and, in turn, will help them strategically consider adding headcount where it’s needed.

2. Identify Hiring Gaps

A sure-fire way to help ensure the success of your headcount plans is understanding your organization holistically – we’re talking total compensation to job openings to team structures. Specifically, knowing your current workforce inside and out can help you identify gaps so you know exactly who to hire down the line.

With a platform that houses your people data in one place, you can quickly access an up-to-date visualization of your people, reporting structures, and company goals to better understand your business and its headcount needs.

With this knowledge, you can take note of your workforce’s current skills, talents, and backgrounds to identify hiring gaps. For example, maybe your marketing department wants to prioritize SEO in the upcoming year, but the current team is composed of a public relations specialist, a content writer, and a graphic designer. The skills gap on the team would indicate that hiring someone with explicit SEO knowledge should be included in upcoming headcount plans.

ats integration gif

ChartHop collects and centralizes all of your people data in one place so the right people have the right information to make the right decisions.

Pro tip: Use your people data to drive meaningful change. When you look at your data in one place, you can determine areas of improvement. For example, organizations should make it a routine practice to slice-and-dice their current DEIB information by demographics like race, gender, ethnicity, and age, to then create a hiring plan according to their goals.

3. Examine Your Roadmap

Looking ahead also naturally provides businesses with a needs analysis. When creating a headcount plan, it's vital to examine your business roadmap to inform your hiring decisions.

To start, look at upcoming key milestones: What's coming down the pipe that might need additional headcount? Your answer could include a new product launch, the introduction of an entirely new department, or a new round of company fundraising.

Next, examine your internal goals and company mission with a keen eye. What did your company set out to do, and do you have the headcount to meet these objectives? For example, maybe your company's board wants you to expand your sales team by 30% in the next year. Do you have the sales headcount in place to do that? Do you have enough marketing staff to feed the sales pipeline and drive revenue?

Hiring is comprehensive, so consider how your organization works holistically to achieve KPIs when setting headcount. Remember, a strong team is the backbone of any successful business, so take the time to plan and strategize effectively.

easily filter through your people

ChartHop allows you to export and explore historic versions of your company.

Pro tip: Looking back on past headcount plans can be helpful for accurate headcount planning and forecasting. ChartHop uses a dynamic timeline feature to visualize how reporting structures have changed over time so you can iterate with intention.

4. Align Stakeholders

In headcount planning, transparency and context are key. Hiring is holistic and includes a variety of different people who need to be on the same page, like recruitment teams, Finance, HR, and individual hiring managers. Working off of disparate spreadsheets and data is a nightmare, but when all stakeholders are aligned, you’ll feel like Leo in Titanic (aka King of the World).

The preferred way to align the decision-makers is by housing all of your people data in one platform. By doing so, you’ll see numerous benefits, including:

  • Seamless collaboration. For accurate headcount planning and forecasting, everyone should work off the same data. And when it’s located in one place, you can easily open and close vacancies, merge teams, and see how other teams are restructuring to plan accordingly.
  • Effective communication. Your source of truth shouldn’t live in your inbox. When stakeholders can approve and comment on scenarios within your platform, your communication goes from “Where’s that email, again?” to a one-click action.
  • Streamlined workflows. Eliminate hiring bottlenecks and simplify processes between stakeholders. With modern permission controls, enable leaders to approve headcount plans, allocate budget, and create succession plans.

Joe Taranto, HR Generalist & Project Manager at Rémy Cointreau, has personally seen the benefits of stakeholder alignment and how it streamlined their planning process. He says of their people operations platform: “It’s not just for decision makers: ChartHop serves as a go-to resource for the entire company to leverage, so everyone can see finished headcount plans and know exactly where the business is headed.”

ChartHop align stakeholders to headcount plans

Streamline your headcount planning efforts by choosing a platform that connects stakeholders throughout your organization.

Pro tip: Create a personalized view within your platform to quickly access the data applicable to your role and responsibilities.

5. Support New Hires

In order for your headcount plan to be successful, you need to have the resources and training in place to support new hires when they join the team. Implement onboarding plans that prioritize tactical training so new employees can hit the ground running on their first day.

While tactical training is key, onboarding is also a time to familiarize new hires with the company culture, mission, and values. Have resources readily available for employees to learn about your organization. This could be a company intranet, Slack channel, or a Google Doc that simply outlines what your mission and values are. Also consider implementing a buddy program so new hires have a “go to” person as they navigate the first few weeks.

ChartHop About Me Profile

Encourage employees to fill out “About Me” profiles to create connections from Day One.

Pro tip: Collect metrics throughout your employee lifecycle, including the onboarding stage. Take a dive deep into your current onboarding initiatives – like time-to-fill, 30-60-90-day plans, and engagement – to see what’s working and what’s not. Taking the time to analyze this data makes it easy to improve on initiatives down the line.

The Bottom Line

Creating a successful headcount plan involves careful consideration of a number of different factors. It’s important to start by identifying the business goals and objectives that your headcount plan is intended to support, as well as the specific roles and skills that will be needed to achieve these goals. From there, assess your current workforce and identify any gaps or areas where additional resources may be needed. And remember, it's essential to collaborate with all stakeholders to ensure everyone is on the same page and working towards the same objectives.

But like all plans, you’ll want to regularly review and adjust it as needed to ensure that it remains aligned with the changing needs of your business. This may involve conducting regular workforce assessments, monitoring KPIs, and making changes to the plan as needed to support the ongoing success of the organization. By following the above checklist, you can create headcount plans that are effective in supporting business goals that drive organizational success.

Headcount planning doesn’t have to be a pain for Finance teams. Our CFO explains how to transform your forecasting from complicated to seamless, giving you a competitive advantage.

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