The role of management within any business model has recently undergone some drastic changes in terms of approaches to success and productivity measures. Previously, hard skills were the major demand for the employee, and the manager’s role, thus, was to track the workers’ productivity considering the company’s goals. Nowadays, the notion of hard skills is being undermined by soft skills, i.e., one’s ability to establish proper communication within a team along with other interpersonal characteristics. At the beginning of the millennium, researchers were also trying to predict the possible effects the Internet would have on the labor market (Autor, 2001). However, the changes that came with the online labor market are difficult to analyze properly even today, when the whole world already seems digitalized.
Sociologists have now come up with a variety of theories and practices aimed at optimizing managerial workforce planning. In order to claim one’s position in the market, a manager should be quite aware of all the factors that influence workforce planning. According to the NIH Management office, workforce planning is ‘the process of analyzing, forecasting, and planning workforce supply and demand, assessing gaps, and determining target talent management interventions to ensure that an organization has the right people…to fulfill its mandate and strategic objectives’ (n.d.). The major factors representing an impact on the management process fall into organizational and environmental ones. Hence, the former include strategy, company characteristics, corporate culture, and employee concerns, whereas the latter refer to labor force trends, technology, globalization, and ethics. The primary goal of this paper is to critically analyze both organizational and environmental demands in order to determine their benefits for the managerial workforce planning, along with their areas for improvement.
Organizational Demands
Strategy
Every company has a series of demands and major goals to be achieved within the shortest time. In order to fulfill such requirements, a manager has to provide a full-scale strategy that will organize the workforce in the most efficient way possible. HR management is one of the key constituents of a company’s organizational value and performance rates (Kuipers and Giurge, 2017). With an intention to remain on the track with the company’s ambitions, one may suggest that the employees’ competence is one of the most crucial for the workforce planning, referring to a resource-based theory. The resource-based theory is based on the principle that human capital is one of the main competitive advantages for employers (Brymer, Molloy, & Gilbert, 2014). Furthermore, the level of competitiveness has become reasonably higher once the model of contingent work has been elaborated by the market.
As a major consequence, the talent pool is now replete with valuable candidates who are of significant importance for the management. The investment of talent as a resource, encompassing the notions of competence, commitment, and contribution, is now considered to be a key to the successful performance (Schiemann, 2013). Once a valuable employee becomes a part of the team, it is then crucial to secure efficient team collaboration so that job satisfaction could lead to better performance. The idea of estimating such symbiosis is introduced in the concept of total quality management (TQM), which is aimed at satisfying both stakeholders’ and employees’ requirements in the most efficient way possible (Kiran, 2016). Taking these ideas into consideration, one may realize that resource-based theory is one of the most relevant in today’s market due to the global trend of social equity and mutual respect within a productive workplace. Thus, the demand of strategy is quite closely correlated with the notion of the managerial workforce planning, as human resource is now a true asset for the overall organizational aspect.
Company Characteristics
Global business market is now replete with companies that fail to succeed because of the lack of proper evaluation of their abilities as a business unit. When cooperating with businesses, the first thing they tend to pay attention to is the characteristics of a company one is working with (Kotler, Manrai, Lascu, and Manrai, 2019). These characteristics mostly deal with the major tasks and values of a company, along with its global expansion rate. These basic notions, in some perspective, usually shape the staff’s culture vision of the company, which then is used as a tool for collaboration for a manager.
Besides studying the external factors that build a company’s image, it is of crucial importance to thoroughly examine the patterns of its internal labor market. In the course of this research, a manager has a chance to estimate which of the characteristics are the most important for an employee, thus predicting the team’s behavioral patterns and level of commitment. For instance, some companies’ characteristics in the labor market include benefits for non work-related issues (Lucifora, Meurs, and Villar, 2017). While it might be of higher importance for some workers, it is important to keep the production to such an extent that the staff is interested in the work’s outcome in the first place.
Corporate Culture
As long as it always the measurable outcome of the business process that matters the most, staff employees are quite frequently the main resource behind the result. Although it may sound disturbing, the company’s administration is not always interested in the HR flow in the company as long as the employee is not a true asset to the business. The competitive advantage of the company allows it to be easily differentiated from other competitors on the market due to its unique approach to business. Such an advantage may be represented through innovative technology or an advanced HR system. However, researchers now claim that one of the most significant ways to gain a competitive advantage is to secure a proper form of engagement (Kumar and Pansari, 2016). In such a way, both customers and employees are equally involved in the project, establishing a positive dynamics of the company’s income rates.
In order to analyze these dynamics, a dynamic theory, along with the dynamic aging chain model, was introduced. The major idea behind the theory is that human resource management directly influences the company’s competitive advantage, and this relationship can be measured through system dynamics (Gobler and Zock, 2010). The statistics developed from the system then help managers launch a strategic planning model, where they can calculate the required number of potentially hired employees and trainees.
Still, however, workers have to be able to feel the company’s spirit and why the culture is so important in the workplace. In order for them not to be perceived as a plain tool for doing an assignment, the corporate culture was introduced, putting a deeper and sophisticated sense in what people are doing for the company. Hence, it is manager’s concern to convey this culture to the employees, building a team out of isolated specialists.
Employee Concerns
Once an employee applies for a certain position in a company, one have to make sure that a person did not enter the staff without proper counselling. In the situation of ambiguity, on a subconscious level, a person may create a list of certain expectations for the job that will not be met and hence, would create a wrong impression from the start. When planning a managerial work frame, one has to take into consideration the peculiarities of the worker-employer interaction. The work itself implies the execution of some tasks in exchange for a determined compensation. Often, such a relationship is based on psychological and behavioral interactions know as psychological contracts. Rousseau defined a psychological contract as ‘the actions employees believe are expected from them and what response they expect in return from the employer’ (Wellin, 2016, p. 2). These contracts are, in their turn, divided into two types: transactional and relational (De Cuyper and De Witte, 2006). The relational aspect covers the peculiarities of socio-emotional interactions, where an employer can expect his/her employees to be dedicated by promising job security.
While the aforementioned aspect is rather subjective, the transactional aspect deals with exact timeframes and expectations like economic exchanges. The psychological contract theory, hence, presents the idea of job security to be the actual driving force of the managerial relationship. As it was mentioned earlier, job security is one of the expectations employees are to meet in the context of the relational psychological contract. This provides scholars with a hypothesis that the relational aspect is, thereby, one of the main mediators between job security and, hence, job and life satisfaction (De Cuyper and De Witte, 2006). Regarding the issue, one may note that although this theory makes sense, the matter is highly individual. Many Millennial and Generation Z employees are eager to experience different kinds of challenges, and job security is not as important for them as learning and gaining valuable experience.
Environmental Demands
Labor Force Trends
Today’s labor market is extremely concerned with handling the rapid increase in the number of workers who are not likely to dedicate themselves to a particular workplace. In order to understand the matter, the notion of contingent and non-contingent workplaces should be explained. According to Polivka and Nardone, contingent employment can be defined as a job in which a worker is not dedicated to a certain workplace due to an implicit or explicit contract (Coyle-Shapiro and Kessler, 2002). The non-contingent model, hence, presupposes a long-term commitment to an employer with an established minimum of working hours and payment.
Although each of these job types has its benefits for the employer, part-time workers are often interested exclusively in the economic benefit, while full-time employees have a certain kind of attachment to the workplace. Social exchange theory presupposes that besides working relationship, both workers and employers have some social agreements that are not fixated officially (Schmidt, Willness, Jones, and Bourdage, 2018). The potential benefits of maintaining a good relationship with an employer make full-time employees invest not only their cognitive but also behavioral resources in order to fulfill their career. Taking these factors into consideration, it may be concluded that social exchange theory presupposes the perks of having a full-time commitment to a certain business unit. However, the major threat of such a relationship is focus shift from the maximum dedication to work productivity toward improving one’s relations with the management. It may be recommended to either encourage part-time workers to take more initiative in social benefit or make full-time employees more concentrated on their actual activity output. In such a way, a balance could be established within both contingencies.
Technology
The impact technology has on the managerial workforce planning is difficult to overestimate. Being one of the most important constituents of the 21st century’s society, it creates an invaluable opportunity to connect workers all over the world. The number of vendors companies hire for an economical benefit is now steadily rising. However, aside from all the perks, managers have to put a tremendous effort in order to organize the work in a virtual dimension. Hence, in order to remain relevant, management’s major task is now to learn how to adapt to technology without losing the aspect of communication within the team.
Globalization
With the world community being brought together, innumerable opportunities have opened for the businesses, pushing them to appear in the bigger market. Such a responsibility means total shift in terms of workforce planning. Since the commence of industrialism, with people moving to urban areas and having better access to education, employers had been paying attention exclusively to the workers’ hard skills, i.e., their professional knowledge and competence. The human capital theory supports the idea by claiming that education determines both labor and productivity levels (Marginson, 2019). The theory seems to be beneficial for an obvious reason to be at an advantage in the labor market. Moreover, the educational system has been steadily improving over the years in order to turn graduates into full-scale professionals (Bills, Di Stasio, and Gërxhani, 2017). However, there has been a growing controversy on the subject, claiming that human capital is an asset that cannot be predetermined by a university degree. Soft skills that revolutionize the market today are the ones that are frequently obtained outside any educational establishment.
The issue especially concerns the US generalist education system, which is not closely related to the qualifications required by the employers. Instead, it rather giver an idea of the future occupation along with some theoretical basis, leaving everything else on the future working experience. Hence, it can be reasonable to believe that the human capital theory is quite limited in terms of today’s market that encourages learning through informal education and experience. The impact of globalization, in its turn, encourages employees of the future to have an empirical attitude towards life.
Ethics
In the context of the 21st century, the notion of ethics has acquired a completely new meaning, implying paying much attention to the ways people treat each other in a business unit. Within a business paradigm, ethics is divided into three major levels: intrapersonal, interpersonal, and organizational (De Cremer and Moore, 2019). When it comes to the organizational level, the manager’s primary aim is to make sure no one in the staff feels pressured, discriminated against either financially or emotionally, or harassed. Although it seems a default option, the tolerance policy may also interfere with the company’s productivity and the workforce planning decision.
Nowadays, many employees are likely to support the idea that each occupation within a unit has an equally significant role in the overall performance. Although this policy is efficient in terms of HR management, some roles still tend to expose more benefit to the company when examined individually. In order to analyze this performance significance, Jacobs used a contingency theory to juxtapose the overall company’s success with individual performance (Cappelli and Keller, 2014). As a result of the findings, he came to the conclusion that some occupations are of higher importance for the whole picture and, hence, require more investment and encouragement.
Although it may seem unfair from the human point of view, no personal characteristics of the employees were taken into consideration, the focus was placed exclusively on the work amount in the context of the company’s goals. Regarding this detail, it may be concluded that such a theory might be the case due to today’s quite competitive market. However, in terms of the current equality management trends, identifying someone’s work as more valuable may lead to major misunderstandings within a team. Hence, this approach should be applied only in cases when team members are able to deal with such treatment while remaining unbiased.
Conclusion
The following paper was aimed at analyzing the impact organizational and environmental demands have on the managerial workforce planning decision. Having observed the notions of strategy, company characteristics, corporate culture, employee concerns, labor force trends, technology, globalization, and ethics, it was estimated that all of them have a tremendous impact on the process of workforce planning. In order to prove the point, all the factors were critically compared with the theories now existing in the management practice. Hence, current approaches to the workforce planning are not exhaustively sustainable in terms of the modern world’s demand, so they require prompt actions to be taken in order to remain the practices relevant.
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