The Unknowable Headcount Plan

Our headcount plan is in the same box as Schrodinger’s cat - so…good luck.

Headcount plans (for me) have included: a whiteboard in my office tracking requests, post it notes dropped off on my desk, departmental budget spreadsheets (engineer 1, engineer 2, engineer 3), over-designed “scenario” tools, a 3 or 4 digit number from a CFO via Slack - and a tangled, indecipherable web of req numbers in Workday.

Founders have balked at putting anything on paper - just be agile with the business, you don’t need a plan, it will change. I’ve had a CFO tell me I must be lying when I delivered a year-end forecast. I’ve encountered hiring manager’s shadow headcount plans where they would change role priorities daily while demanding their recruiter keep up.

The general sentiment has always been: we can’t commit to a plan because it will only hold us back…but I know for a fact that recruiting is behind.

And they’re all wrong. You need a plan and the cat is definitely alive.

I love a plan - plans are my favorite. My headcount plans are beautiful things. So, maybe I’m biased. But - I know based on my success in this particular corner of talent in quickly evolving organizations - a plan is needed, wanted, and oh so appreciated.

Let’s dig in…

Sticking with the cat theme, here are the three common attitudes of folks that aren’t into having a plan that anyone is accountable for or to. I’m firmly in the “ask forgiveness, not permission” camp when it comes to talent-owned hiring plans - or more accurately “build it and they will come,” so let’s assume you’ve built or are building a plan when you encounter one of these leaders.

Stay Agile

“We need to stay flexible! We’re an agile company!”

(often also the “do more with less” crowd)

Not documenting your work leaves massive risk for runaway headcount budgets, rogue hiring managers, and losing the ability to track recruiting activity (e.g. capacity planning data, attainment to plan, etc.). Headcount plans are made in spreadsheets, not carved in marble.

For these leaders: drive at hiring costs, transparency, and fiscal responsibility (remember all headcount budgets pass through talent at some point).

Non-Committal

“There’s too much uncertainty right now for a plan…”

(avoids talent, avoids everyone…may be debating a layoff or locked in analysis paralysis)

Present data (courtesy of said plan) showing what roles you have open now, what is coming up in the near future (requests), and estimate your recruiting capacity with different options & scenarios. (e.g. If attrition stays the same, here’s how many backfills we’ll need in addition to current and planned requests).

Hesitation often means someone doesn't have enough data or context to give you answers - start by providing insights in order to arrive at an answer together. This is the “strategic business partner” part of the job.

Go Wild

“Approved.”

Approves every headcount request…relying on talent’s capacity to limit growth.

(they just want to see the world burn, also allergic to saying “no”)

You’re being set up for failure. Start by telling hiring leaders (based on your capacity and their outsized plan) what roles won't get filled. Include forecasted attrition. This will get everyone’s attention quickly. In parallel, build options and cost estimates for staffing or augmenting your existing capacity to hit different % attainment goals on the wild plan.

Then go make friends in Finance because “unlimited budget” isn’t in their vocabulary and you’ll need help to wrangle together a more feasible plan, win hearts and minds, then put out fires.

Tip: Track hiring plan expansion in your plan to show original versus re-plans.

Some of the questions, demands, and commentary you can answer with a plan:

• How many laptops do you think we’ll need next quarter?

• We’re running low on desks - how many more new hires are we anticipating in SF?

• You’re saying we hired only 15 net new employees? What was TA doing last quarter?

• James left so I should get a Senior Engineer backfill and then Jackie transferred so I need her backfill too - why aren’t you opening reqs?

• I need numbers for the BOD deck - is this forecast even right?

• Why do you need 1 more sales recruiter? I thought you had capacity?

This list goes on and on. Even when your plan changes month over month from that first 3 digit EOY headcount goal from your CFO - the details, volume, and speed can be measured. Not only that - but you can track how much it changes and where headcount is coming and going from.

Your headcount plan will become the most sought after artifact for finance, chiefs of staff, and your operations teams* to understand headcount (past, current, future). And in the chaos of any good “agile” startup environment you can capture the unknowable** - like:

• Laptops, desks, or happy hour budgets: I have 35 new hires starting next quarter based in the US with an additional 20 to hire in quarter - and ~50% will be in engineering.

• What did talent do for me: Yes, we only hired 15 net new roles last quarter because the team was filling 32 high priority backfill reqs! You’ll get more detail in our QBR next week.

• Musical chairs: James left, but you ran out of net new headcount so an in process candidate filled his spot 2 weeks ago. Jackie transferred, but because she moved to a team without an open headcount her budget moved along with her and you don’t have any additional heads to hire for.

Internal mobility and transfers, backfills, headcount re-forecasts, out of process hires - which all at times escape your systems, reports, and processes now have a place to get captured. The unknowable is known. And in leaner times when we’re all doing more with less - your plan provides the data you need to back up your own team’s staffing. Less feelings, more data.

*Operations teams = your besties. Establish friendships early, often, and continuously with: people ops, HRIS admins, IT team (yes the whole team), L&D or onboarding folks, facilities, etc. These are the folks that take your excited, hopeful, newly signed candidate and bring them into the company!

**The unknowables all = $. Talent acquisition is the #1 revenue driving team in the organization - but headcount, benefits, support staff, events, office space all make up the #1 expense to the organization. So be smart about it.

This is the first in a series of posts I’m writing about headcount plans: what goes into building a headcount plan, how to build reports and analytics from your plans, creating capacity models and hiring scenarios, advising business units on designing their own plans, digital downloads, and more.

If you’d like to chat about your headcount plan plans let me know!

Turns out the box was just mostly full of cats.