Strategic Workforce Planning: The number one challenge for CHROs in 2025
Strategic workforce planning is top of mind for CHROs in 2025.
Chief Human Resources Officers (CHROs) in 2025 face a complex talent landscape where strategic workforce planning has emerged as the number-one challenge and priority. In an era defined by rapid technological change, skills shortages, and economic uncertainty, HR leaders are under pressure to align talent with business needs more precisely than ever. Recent research underscores this urgency – for example, Gartner’s 2024 survey of HR priorities found that only 29% of HR leaders believe they can deliver on their workforce planning goals . Likewise, a Deloitte study reports 80% of organizations are investing in workforce planning initiatives to address these gaps . CHROs are no longer just managing HR operations; they are strategic partners expected to forecast and fulfill the talent needs that drive business outcomes. As PwC noted in a 2024 Pulse Survey, 60% of CEOs now view CHROs as highly effective business partners in driving company strategy , reflecting the heightened expectations on HR leadership.
“Workforce planning is like solving world hunger. It’s a universal problem that never goes away.”
— CHRO of a global health company
The above perspective from a Fortune 500 CHRO encapsulates the scale of the challenge. Workforce planning is a continuous, ever-evolving effort – a “universal problem” that demands constant attention . In 2025, this challenge is amplified by external disruptions and internal pressures. Organizations must plan for an unpredictable future of work (including hybrid work models and AI-driven job transformation) while grappling with immediate issues like high turnover and wage inflation. It’s no surprise that CHROs overwhelmingly rank strategic workforce planning at the top of their agenda. Yet few feel fully prepared to excel in this area. Due to persistent changes in the market, 61% of CHROs say their workforce planning horizon is now restricted to just one year – a striking indicator of how difficult long-term talent planning has become. Many HR leaders acknowledge that traditional headcount planning is insufficient for today’s needs. In fact, Gartner research finds 66% of HR leaders admit their current workforce planning is limited to basic headcount planning , rather than the strategic, skill-based planning needed to future-proof the organization.
Against this backdrop, leading CHROs are seeking new approaches to workforce planning. They recognize that effective planning goes beyond filling positions – it’s about ensuring the right skills, in the right places, at the right times to execute business strategy. As Dermot O’Brien (former CHRO of ADP) observes, a solid plan can reduce organizational friction and improve agility. “Strategic workforce planning removes unnecessary friction… The better you can plan, the faster you can deploy people to the business needs, and the faster you can solve customer or client issues,” O’Brien explains . In other words, investing in robust workforce planning capabilities can make the difference between a reactive HR function and a proactive, strategic one.
Confronting the Skills Gap and Talent Shortages
One of the core drivers making workforce planning so urgent is the widening skills gap across industries. As businesses evolve, many are finding that the skills of their current workforce do not fully match the skills needed for the future. Research by McKinsey & Company (2023) reported that 87% of companies worldwide either face skill gaps now or expect to within a few years . Similarly, the ManpowerGroup Talent Shortage survey (2023) shows 75% of employers report difficulty finding the talent with the right skills . This skills mismatch threatens to constrain growth and innovation. In fact, global estimates suggest the talent deficit could cost organizations up to $8.5 trillion in unrealized annual revenues by 2030 if not addressed . Little wonder that workforce planning in 2025 is inseparable from aggressive skills development and talent acquisition strategies.
CHROs are responding to these shortages by making skills-based talent strategy a centerpiece of workforce planning. In PwC’s 2024 Future of Work analysis, 86% of HR leaders said they are increasing investments in skills-based talent architecture – essentially redesigning jobs and career paths around skills rather than static roles . The logic is clear: by understanding what skills the organization already has and what it will need, companies can more effectively close talent gaps through targeted upskilling, reskilling, and internal mobility. CHROs are shifting from a mindset of “buying” talent (external hiring) to “building” talent from within. Nearly 9 out of 10 CHROs now report having a plan to upskill their workforce for new technologies like AI, ensuring their people can step into evolving roles rather than relying solely on hiring from the outside .
“This year, we’ve become quite prescriptive. We’ve said for certain types of jobs, we will not hire externally because we’ve got skills adjacencies within our business that we can reskill and redeploy. So good for our business, but also massively great for our employees.”
— Tanuj Kapilashrami, CHRO, Standard Chartered Bank
The quote above from Standard Chartered’s CHRO highlights a best-in-class approach to closing skill gaps. By identifying “skills adjacencies” – capabilities in the existing workforce that can be developed to meet new needs – the company chose to redeploy and reskill internal talent instead of defaulting to external hires . This not only fills critical roles faster but also boosts employee morale and retention by investing in people’s growth. Many large organizations are following suit, using internal talent marketplaces and AI-driven skill assessments to match employees with new opportunities. CHROs recognize that tapping into underutilized internal skills can be a win-win, addressing talent shortages while engaging employees in their own career development.
Of course, not all skill needs can be met internally, and strategic workforce plans still account for external recruiting when necessary – especially for entirely new capabilities. But even in recruiting, the focus is shifting to skills over traditional job titles. Some firms have removed formal degree requirements from a majority of job descriptions, focusing on skill proficiency instead . This broadens talent pools and acknowledges that critical skills can be developed through nontraditional paths. In short, the skills-first ethos is redefining talent strategy. CHROs in 2025 must continually map the skills their organization has versus the skills it needs, and then decide whether to build (train existing staff), buy (hire new employees or contractors), or “borrow” (leverage gig workers or automation) to fill the gap. This dynamic skills management is now at the heart of workforce planning.
Leveraging Data and Technology for Workforce Insight
Strategic workforce planning in 2025 is heavily data-driven. With thousands of employees and an explosion of people-related data (from HRIS, learning systems, performance tools, etc.), organizations have more workforce data than ever – yet making sense of it remains a challenge. As KPMG’s recent CHRO forum concluded, every major company now sits on vast amounts of workforce data that could inform planning . The key is turning that raw data into insight about future talent needs. According to Gloat’s analysis of CHRO priorities, 85% of CHROs say that data and analytics are key parts of their HR strategy . CHROs are increasingly expected to forecast talent supply and demand with the same rigor as financial forecasts, using evidence and predictive models rather than intuition alone.
Advanced technology is playing a pivotal role in this transformation. Progressive HR leaders are partnering closely with their CIOs and data teams to implement people analytics platforms, AI forecasting tools, and scenario modeling for workforce planning. Gartner researchers note that many companies are adopting more agile planning cycles and using AI to project skill needs under multiple scenarios . For example, one pharmaceutical industry CHRO describes leveraging AI in collaboration with IT: “By partnering with our CIO, we’re able to leverage AI tools to better predict what skills are going to be replaced by automation… We can also apply an AI lens to better understand skills needed in the future.” . This kind of data-informed approach allows HR to anticipate changes (like certain job roles becoming obsolete or new skills emerging) and proactively retrain or recruit staff well ahead of time. It shifts workforce planning from a reactive exercise to a continuous, forward-looking discipline.
Yet, embracing data comes with its own hurdles for HR leaders. Many organizations still struggle with data silos and inconsistent data quality in HR systems. Even when data is available, extracting actionable insights can be difficult without the right analytics talent and tools in HR. A recent PwC study found that while companies are collecting more employee performance and skills data than ever, only 36% of CHROs say they have a platform in place to effectively gather two-way feedback and input from employees (a missed opportunity to enrich workforce data) . Moreover, simply having data isn’t enough – HR teams need governance and frameworks to interpret it. One CHRO from a global pharma company put it bluntly: “What keeps me up at night is the management of ever-evolving skills taxonomy.” . In other words, the challenge isn’t just collecting data on employee skills and roles, but continually updating and structuring that information (a skills taxonomy) so that it’s usable for strategic planning. This is an area where many HR organizations are investing in new systems and expertise.
“What keeps me up at night is the management of ever-evolving skills taxonomy.”
— CHRO for a global pharmaceutical company
Despite these challenges, the trend is clear: data and technology are indispensable for modern workforce planning. CHROs are increasingly leveraging tools like predictive analytics, dashboards, and AI assistants to map out various workforce scenarios (e.g. the impact of automation on staffing needs, or how retirement waves will create skill vacuums). The goal is to enable evidence-based decision making in real time. For instance, 52% of companies are now using new technologies to collect and analyze employee performance data to inform talent decisions . With the right analytics, HR can identify early warning signs of talent risks – such as declining engagement in a critical role or an emerging high-demand skill that is in short supply internally. Such insights allow for preemptive action (like launching a reskilling program or adjusting recruiting pipelines) as part of the workforce plan. In summary, data-savvy CHROs who harness these technologies gain a strategic advantage in planning for an uncertain future.
Aligning Talent Strategy with Business Goals
Perhaps the most important aspect of workforce planning – and the reason it has C-suite attention – is its direct connection to business strategy. In 2025, organizations cannot achieve their growth and transformation objectives without the right human capital in place. CHROs therefore must ensure that their talent strategy is in lockstep with the overall business strategy. This means deeply understanding the company’s direction (new markets, new product lines, digital initiatives, etc.) and translating that into talent requirements. As one healthcare sector CHRO described, workforce planning has to be conducted unit by unit in alignment with strategic goals: “With six unique business units, what strategies, talent, and workforce planning does each unit need? Serving those needs entails a build or buy strategy. It requires that you be in lockstep with your business strategy.” . In other words, HR leaders must partner with each business segment to decide whether to develop talent internally or hire from the market (“build or buy”) for the skills that unit needs to execute its strategy. This close linkage between HR and business planning ensures that talent investments are targeted where the business most needs them.
The evolving role of the CHRO is very much about cross-functional collaboration to achieve this alignment. Successful workforce planning requires input and support from the CFO (for budgeting and ROI analysis), the COO (for operational implications), and other executives. CHROs are increasingly convening workforce planning as a strategic exercise that involves finance and strategy teams, not just HR. According to KPMG’s 2025 CHRO Outlook, many HR leaders are partnering with their CIO on analytics and with their CFO on “buy vs. build” decisions to present an integrated plan to the CEO . This integrated approach yields better insights and greater acceptance of the plan across the leadership team . It also helps HR to speak the language of business outcomes, using metrics like productivity, innovation capacity, or time-to-market, which resonate with other leaders. Notably, 49% of CHROs in a recent survey said that making HR a more strategic partner to the CEO is a high priority for them . By leading the workforce planning conversation in concrete business terms, CHROs solidify their role as strategic advisors.
“With six unique business units, what strategies, talent, and workforce planning does each unit need? … It requires that you be in lockstep with your business strategy.”
— CHRO of a diversified healthcare company
Moreover, workforce planning now extends beyond full-time employees to encompass the extended workforce(contractors, freelancers, gig workers) as part of talent strategy. Deloitte’s research indicates that 65% of organizations expect to rely more on contingent or extended workers in the next two years . CHROs must plan for this total talent mix, deciding which roles can be flexibly filled by external talent versus which are mission-critical to develop in-house. This flexibility can be a strategic lever – for example, using contractors to quickly scale up in areas that are rapidly changing or where permanent headcount is risky. However, managing an extended workforce adds complexity to planning, since HR may not have direct oversight of those workers. Forward-thinking CHROs are implementing “total talent workforce planning” that integrates all worker types into a single view . By doing so, they gain a true sense of the organization’s capacity and can optimize work allocation (e.g., deciding that certain projects will use contract talent so that employees can focus on core activities). The outcome is a more holistic talent strategy that supports business goals with agility – whether through employees, partners, or technology solutions.
Navigating the Road Ahead
Workforce planning will likely remain a daunting challenge, but it is also a domain where HR can deliver tremendous strategic value. As we head further into 2025, CHROs are proving that tackling this challenge is possible through a combination of data-driven insight, skills-focused strategy, and cross-functional leadership. The mindset is shifting from simply filling vacancies to continuously forecasting and developing the workforce the business will need next. In practical terms, this means CHROs must keep asking: Where is our organization going, and do we have the human capabilities to get there? By addressing that question proactively – and by investing in the tools and culture to support strategic workforce intelligence – companies can turn workforce planning into a competitive advantage.
Encouragingly, there is a growing toolkit of solutions to assist HR leaders on this journey. Advanced analytics and AI can illuminate talent trends that were previously opaque. Modern HR technology platforms (like those offered by firms such as Exera) enable integrated planning, letting leaders model different scenarios and see the impact on skills and costs in real time. These innovations, combined with the collective learnings of the HR community, are helping to professionalize workforce planning as a core business process.
Ultimately, winning the workforce planning battle comes down to foresight and adaptability. The organizations that thrive will be those whose HR leaders can anticipate change and mobilize talent in response – all while keeping employees engaged and growing. As one CHRO succinctly noted, workforce planning may never be easy, but rising to this challenge is essential for any business that wants to prosper in the face of uncertainty. By viewing people as a strategic asset and planning for their development and deployment with the same rigor as financial capital, CHROs cement their position as stewards of the company’s future. In the words of a seasoned HR executive, strategic workforce planning is not about predicting the future perfectly; it’s about preparing the organization for whatever the future might hold . And in 2025, there is no worthier challenge for HR leaders to embrace.
Sources:
Gartner (2024). CHRO Priorities Survey – HR leaders’ confidence in workforce planning ; strategic focus on one-year planning ; headcount vs. strategic planning stats .
KPMG (2025). Voice of the CHRO Forum – CHRO quotes on workforce planning challenges and strategies .
McKinsey & Company (2023). Future of Work Research – Data on global skill gaps and talent shortages .
PwC (2024). Pulse Survey (CHRO Insights) – CHRO partnership with CEOs ; upskilling for AI and skills investment figures ; performance feedback and data usage stats .
Deloitte (2025). Human Capital Trends and Workforce Planning – Statistics on workforce planning investments and extended workforce usage .
Quotes from Fortune 500 CHROs: Dermot O’Brien (former CHRO, ADP) on reducing friction in talent deployment ; Tanuj Kapilashrami (Standard Chartered) on internal reskilling vs hiring ; other anonymous CHRO insights on aligning with business strategy and managing skills data .