How FP&A Solutions Can Help with Workforce Planning
By Stacy Brown, Vice President of FP&A Solutions, Marcum Technology
Did you know that labor costs can account for 70% of a business total cost, which includes employee wages, benefits, and taxes? It’s needless to say that workforce planning is an essential part of any successful business. However, many organizations are faced with the challenge of having to create and manage their workforce planning manually. Fortunately, financial planning and analysis (FP&A) solutions can help streamline and automate many aspects of workforce planning.
When a business is evaluating FP&A solutions they should keep in mind their specific requirements for workforce planning; allowing them to select a suitable solution for the organization. If you’re looking for an effective way to manage your company’s staff resources, read on to discover how FP&A solutions can make a difference.
WHAT IS WORKFORCE PLANNING?
Workforce planning is the process of planning and forecasting human capital. It involves analyzing current and future trends to determine a workforce’s optimal size, structure, and skillset.
This helps businesses optimize their resources, identify areas for improvement, reduce staff costs, and ensure they have sufficient staffing levels to meet their goals. In addition, it can help organizations keep up with changing market conditions and customer demands by enabling them to scale up or down as needed.
Workforce planning helps businesses align their strategic goals with current employees and identify the talent gap and need for future staffing. By taking a strategic approach to workforce planning, companies can ensure they have the best possible team for long-term success.
CREATING A WORKFORCE PLANNING STRATEGY
Before an organization implements an FP&A solution, it must consider the business’s requirements. It’s paramount to ask questions like:
- How often do we forecast or re-forecast workforce planning?
- What are our priority requirements for workforce planning?
- How granular do we want to get in our benefits and taxes?
- What kind of reporting do we want?
- Do we want to compare actuals vs. plans at the employee level?
An important thing to note is that when you’re doing workforce planning and budgeting, it can help drive other costs within your organization—for example, office supplies. Maybe you budget office supplies based on the number of people in an office or department. So, while you may be budgeting for workforce planning, it can be a driver for additional fixed or variable costs within your organization.
At Marcum Technology, we can help configure the workforce planning module your business needs, address how you budget workforce planning, and elucidate the best approaches within your chosen application.
HOW CAN FP&A SOLUTIONS HELP WITH WORKFORCE PLANNING?
Many companies rely on Excel for workforce planning, estimating expenses based on headcount by division, department, and location. However, FP&A solutions revolutionize this process. By uploading an employee roster from the HRIS/payroll system, an FP&A tool expedites 90% of workforce planning tasks, offering benefits like:
- Employee Named Level actuals vs. budget reporting.
- Merit increases at individual and group levels for fair compensation management.
- Handling complex calculations: granular tax (e.g., State Unemployment tax) and benefit calculations (e.g., healthcare plans).
- Calculating new employee costs during onboarding (e.g., computer equipment).
- Efficient management of complex employee allocations across projects, departments, and units.
Embracing FP&A solutions enhances accuracy, efficiency, and strategic impact, driving growth and success in today’s competitive business landscape.
SELECTING AN FP&A SOLUTION FOR WORKFORCE PLANNING
When selecting an FP&A solution, like Planful or Vena, businesses should consider the application’s ability to provide real-time insights and analytics tailored to their specific goals. It should also be able to integrate with existing systems and support multiple departments to streamline processes and improve collaboration between finance, sales, and other teams.
Furthermore, businesses must ensure that the chosen solution can handle complex calculations, such as scenario planning and predictive analytics, to assess future market conditions accurately. Lastly, it’s essential for the selected solution to offer an intuitive user interface that simplifies data entry and encourages user adoption.
While FP&A applications have their own implementation teams, companies should seek guidance and support from an expert familiar with their industry to ensure the application integrates well into their system.
At Marcum Technology, we ask the critical ‘why’ questions to ensure that the appropriate application is selected and integrates seamlessly. This can save organizations a lot of time and money. Through our accumulated experience, we provide the support companies need to create powerful, long-term FP&A solutions.