Strategic Workforce Planning in Dutch Healthcare organizations

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1 Strategic Workforce Planning in Dutch Healthcare organizations Name: Romy Marell ANR: Address: Arendhorst 45, 6043RR Roermond Supervisor: dr. M. Verhagen 2 nd Reader: dr. C. Freese Project Period: Jan-Jan Project Theme: HR Metrics

2 Index 1. Introduction Theoretical framework Strategic Workforce Planning Strategic Workforce Planning process Workforce segmentation Workforce segmentation implemented in the Strategic workforce planning process Contingency factors in the Healthcare sector External factors Internal factors Methodology Research design Research Sample Instruments Document analysis Interviews Procedure Data Analysis Results Description of the cases Strategic workforce planning process Workforce segmentation Workforce segmentation implemented in the Strategic workforce planning process Contextual factors External factors Internal factors Conclusion Discussion Discussion The perceived need for implementing SWP Limitations Theoretical implications and future research Practical implications References Appendix A Interview Questions Appendix B Example Transcript

3 Abstract According to labor market predictions (AZW, 2013) labor shortages in the Dutch healthcare sector will occur. Organizations need to determine their current personnel demands and their future personnel needs. HR tools that can contribute are strategic workforce planning and workforce segmentation implemented in strategic workforce planning. The goal of this research is to investigate which contingency factors influence the strategic workforce planning process in the Dutch healthcare sector and whether workforce segmentation is used in the strategic workforce planning process. In order to investigate these relationships semi structured interviews were held with seven Dutch healthcare organizations. The interviews were aimed at gaining a deeper insight in the strategic workforce planning process and the process of workforce segmentation, In addition, the interviews tried to reveal which contingency factors have an influence on the strategic workforce planning process. Eventually 21 interviews were conducted with Senior Managers, HR managers and Line Managers in seven organizations. It became apparent that only one healthcare organization implemented an actual strategic workforce planning process and none of the organizations used workforce segmentation in the strategic workforce planning process. Several organizations mentioned that they are currently implementing strategic workforce planning and some of the organizations do not recognize the necessity. Therefore, continuous research about these topics in the next few years will probably provide a deeper understanding of these practices. In addition, the results show that four of the contextual factors; available resources, collective bargaining agreements, segmentation of the healthcare sector and size might have an influence on the strategic workforce planning process. However, the organizations mentioned and research shows that the underpinning principle of strategic workforce planning is universally applicable. Therefore, although research confirms these propositions, future research should investigate the influence of these contextual factors in practice. Keywords: Strategic workforce planning, Workforce Segmentation, Contingency Theory, Best-fit Approach, Dutch healthcare sector 3

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5 1. Introduction Since the economic crisis, the unemployment rate in the Dutch labor market has increased each year (CPB, 2013). However, in last decade there is one sector that was characterized by an increase in employment, namely the healthcare sector. In this sector, the total amount of employment showed a growth of jobs in the past ten years (CBS, 2011). In the nearby future, nevertheless, the healthcare sector will have to deal with shortages of suitable personnel. These future shortages in the healthcare sector are caused by the ageing of the Dutch workforce, resulting in a higher outflow of skilled personnel. In addition, there is an increasing scarcity of qualified personnel supply and fewer people will enter the labor market. Furthermore, research indicates that the demand for personnel in the next few years will increase with minimal 140 thousand extra jobs (AZW, 2013). This all, will lead to a discrepancy between the increasing demand for care and qualified personnel supply in the healthcare sector. Therefore, for healthcare organizations it is important to make optimal use of the current personnel and retain the personnel in the organization. In this context, of future personnel shortages, organizations need to determine the current workforce and the future personnel needs. A tool that can contribute is strategic workforce planning, since it is a data driven process that maps current workforce demands and future personnel needs (Giehl & Moss, 2009). In essence, workforce planning is preparing, designing and implementing of strategic policy in terms of inflow, through-flow and outflow of personnel (Evers & Verhoeven, 1999 p.15). Operationally this means, achieving the business objectives in the most efficient way by getting the right people with the right skills, in the right job at the right time (Anderson, 2004; Cotton, 2007). Scientific literature identified that the basic of every strategic workforce planning model is closing the gap between current demand and future supply of labor (Evers & Verhoeven, 1999; Anderson, 2004; Cotton, 2007). During this gap analysis phase in the SWP model, workforce segmentation can play an important role (Lavelle, 2007). Workforce segmentation is described as a way in which organizations differentiate between roles and skill sets and to determine how essential they are to meet business objectives (Lavelle, 2007). 5

6 Even though workforce segmentation is not often implemented in the SWP model, Lavelle (2007) argues that segmentation is destined to play an important role in workforce planning. The aim of SWP as mentioned earlier is putting the right people in the right job at the right time. Workforce segmentation can contribute by identifying strategic positions, support positions and eliminate jobs that do not add value (Huselid, Beatty & Becker, 2005). Segmentation provides organizations insight in their entire workforce and creates an overview of which type of employees organizations need to attract, retain and develop in order to achieve business objectives (Evers & Verhoeven, 1999). Although several researches argue that there are general success factors that determine strategic workforce planning (Anderson, 2004; Cotton, 2007), Evers and Verhoeven (1999) state that the strategic workforce planning process differs in every organization and that no one best way is applicable. In addition, organizations are influenced by several internal and external factors that might cause differentiation in the SWP process. This statement assumes a contingency-based approach; which argues that organizations are influenced by contextual factors. Organizations need to adjust to these factors in order to perform (Donaldson, 2001). Thus, this theory suggest that it might be, that the applicability of a SWP model in the healthcare sector is different, due to contextual factors, than in other sectors in the Dutch labor market. With regard to these developments the following research question is formulated: Which contingency factors influence the strategic workforce planning process in the Dutch healthcare sector and does workforce segmentation play a role in the strategic workforce planning process? This paper contributes to the scientific research in this area in the following ways. First of all, this study provides new insights about the possible contribution of workforce segmentation in the strategic workforce planning process. Secondly, this study provides scientific insight about the application of strategic workforce planning process in the Dutch healthcare sector and provides insight in which contingency factors influence this process. Organizations might benefit from these findings, because this study might provide them a practical guideline for implementing the strategic workforce planning process and/or workforce segmentation in the healthcare sector. Furthermore this study provides organizations with a more 6

7 planned and focused approach to attracting, developing and retaining employees, which will lead to more organizational efficiency. Because SWP is a long-term oriented and ongoing process, healthcare organizations will be able to anticipate on future labor shortages or surpluses. In addition, new insights in which contingency factors influence the strategic workforce planning process will lead to the development of more customized applications. In other words, the SWP process can be better aligned with organizational needs in their specific context. This paper will continue with the theoretical framework, methods, results and finally the conclusion and discussion. 7

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9 2. Theoretical framework This part of the research discusses the central concepts, Strategic Workforce Planning, Workforce Segmentation and the Contingency Factors, and investigates their relationship with each other. 2.1 Strategic Workforce Planning In the literature about Strategic workforce planning, different definitions are used (Evers & Verhoeven, 1999; Anderson, 2004: Freyens, 2010). In the early 90 s, workforce planning was defined as the assessment of future human capital needs and determining and implementing actions necessary to meet the required demands (Ripley, 1995). Since then, there has been a shift from the purely technical aspects of workforce planning towards the inclusion of strategic management, evaluation processes and turnover management (Idris and Eldrigde, 1998). In the past decade, the definition of strategic workforce planning is further elaborated and Cotton (2007) argues that nowadays most definitions include the same general elements. Firstly, strategic workforce planning needs to be aligned with the business objectives of the organization. Secondly, the identification of which people and what kind of skills are needed to achieve goals. Thirdly, the human capital of the organization needs to be aligned with the business direction. Lastly, the required human capital will be continuously available and the strategic workforce planning process will be adapted when needed. However, there is one important issue that has to be added, namely that SWP is not a static system but an ongoing process (IPMA, 2002). This is essential because implementing strategic workforce planning and interpreting the results are essential parts of the business operations. SWP is not effective when managers only use the strategic workforce planning process at one moment in time (IPMA, 2002). To have an overall definition of strategic workforce planning in this research that refers to all elements described above, several definitions are combined which results in the following definition: Strategic workforce planning is an ongoing process of human capital planning, which is aligned with the overall business strategy of the organization. It is a data driven process, which analyzes the current workforce and identifies future workforce needs. Based on this information, organizations are able to identify gaps and develop and implement gap-closing strategies in order 9

10 to achieve organizational missions, goals and objectives (Evers & Verhoeven, 1999; IPMA, 2002, Cotton, 2007; Bechet, 2008) Strategic Workforce Planning process According to several researchers (Evers & Verhoeven, 1999; Choudhury, 2007; Giehl & Moss, 2009) there is no one best way of strategic workforce planning due to contextual factors that influences this process. However several researchers state that every SWP process is based on the same overall starting framework (Nkomo, 1988; Anderson, 2004; Cotton, 2007; Freyens, 2010). In other words, the strategic workforce planning models developed over time are almost all extensions of the basic workforce-planning model of Anderson (2004). This research will outline the basic model of Anderson (2004) and, in addition, will include adaptations made by other authors. First of all, the workforce planning process begins by defining the organizations strategic direction (Cotton, 2007). An inevitable part of defining the business strategy means identifying the core strategic skills and competencies that are needed to achieved the business objectives (Cotton, 2007; Nkomo, 1988; Young, 2006). Secondly, a scan of the internal and external environment must be executed. Information about technological, economic, sociocultural factors and the labor market should be collected and analyzed in order to achieve alignment between the goals, policies, procedures or operations of the workforce planning model and the external changes (Nkomo, 1988; Cotton, 2007). For example the environmental changes (the ageing workforce, labor shortages) in the healthcare sector have a major influence on the design of the workforce planning process. Besides an external environmental analysis focus should also lie on analyzing the internal environment. Factors that should be included are workforce trends (attraction and retention statistics, age and distribution of the workforce), organizational structure, organizational culture and current levels of performance (Cotton, 2007). The third step in the strategic workforce planning process is a supply analysis, which focuses on identifying and analyzing the current supply for labor in the organization based on qualitative and quantitative data (Anderson, 2004; Cotton, 2007). On the one hand qualitative data is important for mapping current skills and competencies of employees and eventually mapping 10

11 strengths and weaknesses of the workforce (Nkomo, 1988). On the other hand quantitative data is necessary to conduct information and trends about developments in the workforce that will have an influence on the organization when no action is taken (Anderson, 2004; Evers, 2011). After the supply analysis, organizations need to identify the future workforce demands through a demand analysis. This step provides an estimation of future personnel needs in terms of required numbers of employees as well as future needed skills (Anderson, 2004; Cotton, 2007). While identifying these workforce demands, organizations have to take in to account the overall strategy of the organization, changing work boundaries and environmental factors influencing the workforce (technology, labor market developments) (Anderson, 2004; Cotton, 2007). Based on the two earlier phases, organizations should be able to match the current supply with future needed demands (Anderson, 2004; Freyens, 2010). The gap analysis phase reveals the differences between current labor supply and future labor demand. There are three different situations that can occur: expected skill/labor shortages (demand exceeds supply), surpluses of labor (supply exceeds demand) and that current demand and future supply are in balance (Anderson, 2004). In this phase of closing the gap, emphasis must lie on both short-term solutions as long-term strategies. HR practices that contribute to executing strategies are training and development and compensation and benefits. (Cotton, 2007). After developing a gap-closing strategy the final step of the strategic workforce planning process is the implementation and evaluation of the developed strategy (Anderson, 2004). For successfully implementing workforce strategies several aspects are critical such as leadership, communication between workforce team members and other employees/managers and lastly resources that facilitate the implementation phase (Cotton 2007). After implementation, the strategic workforce process needs to be evaluated and revised were needed (Anderson, 2004). Figure 1 shows the strategic workforce planning process as described in the above sections. 11

12 Evaluation And ongoing process Define strategic direction Implementati on External and internal scan Gap Analysis Supply analysis Demand Analysis Figure 1: Strategic workforce planning process Although almost 70 % of the costs made in the healthcare sector are personnel costs, according to the Dutch research institute for healthcare NIVEL (2011), a strategic workforce planning process, such a described above, is missing in many healthcare organizations. In addition, with the ageing workforce coming up and the increasing workload in the healthcare sector, a SWP process is now more important than ever. This is because the aim of SWP is to identify current workforce demands, determine future personnel needs, execute a gap analysis and develop and implement gap-closing strategies. Therefore, this study investigates to what extent healthcare organizations have applied a strategic workforce planning process based on the earlier mentioned SWP process steps. Therefore the following sub-question is raised: To what extent have Dutch Healthcare organizations implemented a strategic workforce planning process? 12

13 2.2 Workforce segmentation Lavelle (2007) argues that workforce segmentation is destined to play an important role in the workforce planning process. Workforce segmentation is defined as identifying different roles and skill sets in order to determine how essential they are to meet business objectives and align with the overall strategy of the organization (Lavelle, 2007). In addition, according to the resourcebased view of the firm, organizations consist, on the one hand out of core roles that create value and on the other hand out of peripheral roles that are value supporters (Lavelle, 2007; Boxall & Purcell, 2011). Furthermore, Lepak and Snell (1999) stated that segmentation between employment groups asks for different employment relationships. Thus, different groups of employees possess different skills, vary in their employment relationship and have different levels of importance while achieving competitive advantage (Lepak & Snell, 2002; Huselid, Beatty & Becker, 2005; Cascio & Boudreau, 2010). Several authors have developed different approaches of identifying and analyzing the strategic positions in the workforce (Lepak & Snell, 2002; Huselid, Beatty & Becker, 2005; Boudreau & Ramstad, 2007; Cascio & Boudreau, 2012). Huselid, Beatty and Becker (2005) made a distinction between three categories, namely A-, B-, and C-Positions. A-Positions are the key positions in an organization that have direct strategic impact. Positions that have indirect strategic impact by supporting A-positions are defined as B-Positions. The last groups are the so-called C- positions, these are needed in the organization but have little to no strategic impact. Boudreau and Ramstad (2007) also differentiated between employees groups whereby they made a distinction between pivotal roles in the organization, in other words the core employees, and the non-pivotal roles. Pivotal roles are the ones where differences in performance affect the strategic success of the organization the most (Cascio & Boudreau, 2012). Lepak and Snell (1999, 2007) distinguished different employees groups by means of the HR architectural framework, see figure 2. This architectural framework will be used in this study because of its clarity and the extensive research that has been done on this model. Lepak and Snell (1999) made a distinction between four types of employee groups, whereby the distinction has been made on the one hand to the uniqueness of the human capital and on the other hand to the strategic importance of human capital. Human capital in the first quadrant is both 13

14 unique and contributes to the strategic value of the organization and therefore these employees are considered as the core employees (Lepak & Snell, 1999). Organizations should invest in these employees in terms of training and development, participation and empowerment and compensation and benefits, this is called a commitment-oriented HR system Secondly, there are employee groups who have strategic value but their skills and competencies are not unique for the labor market. Thus, these employees are important in terms of achieving business objectives but have skills that are widely transferable in the sector. In this quadrant the focus lies more on a productivity-based relationship. In addition, organizations should not invest in training and developing these employees but should hire them and calculate the possibility that they might leave. Thirdly, Lepak and Snell (1999; 2007) identified that there is human capital that has low uniqueness and does not contribute to the strategic value of the organization. This compliance based HR relationship implies that organizations should outsource these employees or hire these employees through temporary work agencies. Employee groups that have on the one hand high uniqueness, but on the other hand have low strategic value are part of quadrant four. Lepak and Snell (1999) argue that this type of human capital needs to be managed via a collaborative HR approach. In addition organizations need to engage in alliances or partnerships with other organizations. The model of Lepak and Snell (1999), see figure 2, provides a guideline for identifying four types of employment. However, this will raise the question whether in practice healthcare organizations identify strategic positions? And in which way is this process designed? Thus, the following sub-question is raised: To what extent do healthcare organizations segment their workforce and if so, in which way is this process designed? 14

15 Figure 2: HR Architecture (Lepak and Snell, 1999) 2.3 Workforce segmentation implemented in the Strategic workforce planning process The strategic workforce planning process provides insight in the current workforce and identifies future workforce needs to meet business objectives. Thus, on the one hand this means executing a supply analysis in which the current supply for labor is identified and analyzed based on qualitative and quantitative data. On the other hand, future workforce demands needs to be estimated in terms of headcount and future needed skills. Based on the supply and demand analysis organizations have created an overview whereby the differences are revealed in terms of labor shortages or labor surpluses (Evers & Verhoeven (1999); Anderson, 2004; Cotton, 2007). Huselid, Beatty and Becker (2005) argue that especially in positions that have direct strategic impact, having the right people in the right job is important, due to the fact that in these strategic positions high performance variability will occur. In addition, this specific group is critical for executing the strategy of the organization (Boxall & Purcell, 2010). Thus, when an organization is going to implement or execute a strategic workforce planning process, it is important to lay emphasis on the jobs that are core for the organization. For this specific group of employees, who are unique and have high strategic value, organizations rely on a commitment-oriented HR system (Lepak & Snell, 1999). There are commitment-oriented HR practices that need to be taken into account while executing strategic workforce planning. When there are insufficient potentials available for closing the gap, external 15

16 recruitment could be a solution (Collings & Mellahi, 2009). During this process of recruitment the focus will lie on skills, knowledge and abilities that are currently not obtainable within the organization (Ready and Conger, 2007). Moreover, organizations need to invest in extensive recruitment and selection for these positions in order to successfully align with the strategy of the organization (Lepak & Snell, 1999; 2002). Besides that, training of current employees will be another solution for preparing current employees for future work demands and filling in the strategic positions (Huselid, Beatty & Becker, 2005). Moreover, investing in the development of the core employees of the organization enhance the opportunity of retaining these employees (Lee & Bruvold, 2003). In addition, training and developing employees has a positive effect on performance (Aguinis & Kraiger, 2009). Concluding, the strategic workforce planning process can identify possible future labor shortages in an early phase and it is a process whereby organizations can cope with this issue. Furthermore, segmentation of the workforce can contribute to this process by identifying the different positions and employees in the organization. When the strategic positions are revealed, organizations need to lay emphasis on attracting, training and retaining employees in these positions. However, almost no research has investigated the relationship between workforce segmentation and strategic workforce planning. Thus, it is therefore important to investigate whether healthcare organizations use workforce segmentation in the strategic workforce planning process. This results in the following sub-question: To what extent do healthcare organizations use the process of workforce segmentation in strategic workforce planning? 2.4 Contingency factors in the Healthcare sector The previous sections provide an outline about the strategic workforce planning process and gave an overview of the concept workforce segmentation. However as earlier mentioned, there is a discrepancy in the literature whether the SWP process is a best practice (Nkomo, 1988; Anderson, 2004; Cotton, 2007; Freyens, 2010) or whether there is no one best way of strategic workforce planning (Evers & Verhoeven, 1999; Giehl & Moss, 2009; Boxal & Purcell, 2011). Although 16

17 researchers argue that the design and implementation of SWP depends on internal and external contextual variables, no study investigated which contingency factors matter in the Dutch Healthcare sector. The aim of this study is to explore which different contextual factors might effect or influence the strategic workforce planning process in healthcare sector organizations. In practice, this will lead to a more custom developed SWP process that aligns with the organizational objectives of the specific organizations. Therefore the following sub-question has been formulated: Which contextual factors influence the strategic workforce planning process in the healthcare sector? The following section will provide an overview of different potential factors that, according to research (Evers & Verhoeven, 1999; Paauwe, 2004; Datta, Guthrie, & Wright, 2005; Boxall & Purcell, 2010), have an effect on the strategic workforce planning process in organizations. However this list of contextual factors for the Dutch healthcare sector is not exhaustive and will be complemented during the explorative stage of the research. In addition, both possible internal and external contextual factors will be discussed in the upcoming section External factors According to several researchers (DiMaggio & Powell, 1983; Paauwe, 2004; Boxall and Purcell 2010), there are multiple external contingency factors that have an influence on SHRM practices and thus on strategic workforce planning. The factors that will be taken into account are part of the institutionalized context. The factors are intensity of competition, segmentation in the healthcare sector and collective bargaining agreements. Institutionalized context The external factor that will be discussed is the institutionalized context of the healthcare sector. The Contextually Based Human Resource Theory (Paauwe, 2004) states that organizations not only respond to institutional settings. Institutional mechanisms, such as legislation, the role of trade unions and the role of government influence the design of SHRM policies and practices (DiMaggio & Powell, 1983; Veld, 2012). Regarding the institutional mechanisms in the Dutch Healthcare sector, the sector is characterized by a specific institutional setting, namely the combination of market processes and government regulations (Veld, 2012). In addition the Dutch 17

18 healthcare sector consist out of different segments. These different segments are: academic hospitals, other hospitals, GGZ, Disabled care, Nursing and home care, other care, well-being and social services, youth care, childcare (AZW, 2013). The segments are among other things characterized by different levels of competition and different collective bargaining agreements (Evers & Verhoeven, 1999). In the following section three factors will be taken into account namely, segmentation of the Healthcare sector, intensity of competition and collective bargaining agreements Segmentation of the Healthcare sector According to Boxall and Purcell (2011) it is essential for organizations to adapt to the industry context. However, industry is a broad concept that consists out of various levels in which differences in strategic workforce planning processes occur. These various levels are: differences between broad sectors, differences between industries within sectors and differences within industries across strategic groups (Boxall & Purcell, 2011). The different segments in the Dutch healthcare sector are: academic hospitals, other hospitals, GGZ, disabled care, nursing and home care, other care, well-being and social services, youth care, childcare (AZW, 2013). A labor market prediction from 2013 to 2017 of the healthcare sector showed major differences between the different segments (AZW, 2013). On the one hand there are segments that show a slight higher demand or the same demand of personnel needs in the future, such as hospitals and academic hospitals. On the other hand the AZW (2013) indicates that segments such as nursing and home care sector will have a future labor surplus. Moreover the nursing and home care sector is characterized by a low to moderate skilled workforce, since is mostly consist out of lower skilled nurses (AZW, 2013). While, the hospital sector consists out of a higher skilled workforce with high and specialized skills (higher skilled nurses, doctors) (AZW, 2013). Thus, this indicates that different sectors need to apply different strategic workforce planning strategies, because it is easier to attract low/moderate skilled workforce in comparison to a higher skilled workforce. Giehl and Moss (2009) argue that an organization which contains mostly lower skilled employees, such as nursing and care home sector, talent is viewed as replaceable and focus is on anticipating on turnover and acquire low-cost talent quickly. In other words, for the nursing and home care sector there is less need to implement strategic workforce planning, since short-term vacancy filling and anticipating on turnover should be sufficient. However, since the hospital 18

19 sector relies on a higher skilled workforce with high and specialized skills, there can be assumed that more hospitals have implemented strategic workforce planning. This will lead to the following proposition: Proposition 1: Labor market characteristics specific to different segments, might influence whether organizations have implemented a strategic workforce planning process. Intensity of competition Within each segment in the healthcare sector, or in the whole healthcare sector, organizations need to maintain their position in the competitive market (Boxall & Purcell, 2011). Competition in the industry can be fierce or weak. A competitive industry is, in contrast to a less competitive market characterized by striving for efficiency, effectiveness, flexibility, innovativeness and speed (Paauwe, 2004). In terms of strategic workforce planning this suggests that in markets with a high level of competition, attracting and retaining employees who have the right knowledge, skills and abilities is essential to adapt to the competitive market (Boxall & Purcell, 2011). Regarding to the Dutch healthcare sector there has been a shift made from a more supply oriented system towards a more competitive market whereby the emphasis lies on more demand an patient-oriented care (Veld, 2012). This shift is caused by Dutch policy, which is aimed at more marketization of the Dutch healthcare sector, with the underlying assumption of increasing the quality, the innovative capacity and a more client-oriented focus of this sector (Maarse, 2011). Marketization of the healthcare sector implies more competition and therefore more focus on attracting and retaining employees who have the right knowledge, skills and abilities to achieve competitive advantage (Boxall & Purcell, 2011). Therefore a strategic workforce planning strategy becomes more important in the Dutch healthcare sector. In addition, this raises the question whether organizations acknowledge this and therefore implement strategic workforce planning due to increased competition. This will lead to the following proposition: Proposition 2: The level of competition might influence whether Dutch Healthcare organizations have implemented a strategic workforce planning process. 19

20 Collective Bargaining Agreements Another part of the institutional mechanism is the presence of the Collective Bargaining Agreement (CBA), the Dutch healthcare sector consist out of different CBA s for the different segments. However, in all of these CBA s different HR practices (wages, employee benefits, equal treatment, diversity) are included and pre-determined (Veld, 2012). Therefore one CBA will be discussed in more detail, namely the CBA for general hospitals. The CBA for general hospitals specifically focuses on attracting and retaining employees and furthermore new agreements were made on equal treatment of employees, irrespective of their age. For example, the exception of night and weekend shifts increased to 59 years and employees with a pensionable age are allowed to continue work after reaching this age. These regulations are aimed at extending the amount of available human capital for preventing future labor shortages. This implies that institutionalization affects the composition of the workforce, which inevitably influences the strategic workforce planning process. Therefore the following proposition is formulated: Proposition 3: Collective Bargaining Agreements influence the design and implementation of strategic workforce planning process Internal factors Besides external contextual factors that might influence the design of the strategic workforce planning process, research argues that there are several internal factors that affect the SHRM policies and practices executed in organizations (Evers & Verhoeven, 1999; Cotton, 2007). After a review of the literature, several factors have been selected, which are: size, structure of the organization and available resources. Size The headcount differs among organizations and this has an influence on how organizations should adapt to future workforce needs (Jackson & Schuler, 1995; Evers & Verhoeven, 1999). Jackson and Schuler (1995), argue that large organizations rely less on temporary staff, use more sophisticated staffing, have better training and development and have a more highly developed internal labor markets. In addition, Choudhury (2007) showed in his study of strategic workforce 20

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