The B2B SaaS Benchmark Report is here — see how your KPIs measure up to industry benchmarks.
See How You Rank

Enrique Esclusa, Co-Founder of Assemble — A Complete Guide to Headcount Planning

Enrique Esclusa, a co-founder at Assemble, discusses headcount planning and compensation strategies, the disadvantages of using spreadsheets, and the key pain points of workforce planning.

Subscribe to the podcast


Episode Summary

For SaaS companies, headcount amounts to 70% of operating expenses. If finance dives straight into the numbers without keeping the company’s short- and long-term goals in mind when headcount planning, it spells imminent disaster with misforecasts and errors that can take months, if not years, to resolve. 

In this episode of The Role Forward, our host Joe Michalowski welcomes Enrique Esclusa, co-founder of Assemble. Enrique and Joe get into examples of workforce planning and compensation strategies, diving deep into the disadvantages of using spreadsheets and key pain points of workforce planning.

Watch the Full Video

Featured Guest

Enrique Esclusa

Co-Founder, Assemble

Enrique was born in Venezuela, raised in Miami, Florida, and has been living between NYC and SF for the past 12+ years. After a 10-year career in finance, spanning investment banking and private equity, Enrique delved into his passion of making pay equity a reality by co-founding Assemble.

Key Themes from the Episode
  • Spreadsheets are not suitable for collaboration. While spreadsheets are flexible, their strong suit is not in tracking changes over time and integrating with other systems. The most valuable businesses are tech-forward and driven by knowledge workers, which will continue to trend and impact finance functions.
  • In headcount planning, start at the end. Headcount planning best practices ensure that your organization has the right number of people with the right skills to meet organizational needs in the short and long term. You need to think about the company’s goals for the end of the year and in a three-year timeframe, then work backward to understand your constraints and fill any gaps.
  • Price times volume over time. A straightforward formula like “price times volume over time” allows you to think about specific jobs over specific people to focus on the human capital required to implement critical growth strategies within a company’s budget. Volume then becomes the amount of heads, time is specific start and end dates, and price is compensation.

Episode Highlights from Enrique Esclusa

06:56 — Pain Points of Workforce Planning

“The biggest one is the misalignment and lack of collaboration. And I think a big reason for this is that when you’re living in a spreadsheet, there’s one owner and not everybody can access the real-time version; not everybody wants to. […]

The second one is what I like to call entropy, which is that headcount plans, just by definition, change all the time, and if you’re not tending to them, they just dissolve into pure chaos. And so this idea of having one plan and that’s the panacea; that’s just not how it works. […]

The third one is that, a lot of times, people can ignore things like ratios or time to hire or racism promotions — these things that do add up and change the shape of a headcount plan. […]

The last two are what I think make headcount planning really tough, and that is tracking changes is so hard, especially if you’re doing it on spreadsheets. People often want to go back to a previous plan and say, ‘Wait, where were you a month ago? What changed?’ And if you can’t answer that, then all of a sudden, people lose trust in the headcount plan. And if this wasn’t all super difficult and painful, most companies have, or should have, multiple scenarios. So you’re keeping track of a universe of chaos with parallel universes at the same time.”

29:52 — Planning Cannot Be an Annual Affair

“There’s always a big annual lift, and generally, it’s towards the end of your fiscal year. So for us (at Expanse), it was at the end of a calendar year; at Assemble, it’s actually at the end of January. And so that’s always a big lift, and it’ll take multiple weeks, and in some cases, it can take more than a month to do all the work that you need. However, boards want at least quarterly updates, and so you’re presenting to the board, at least four times a year, on how the plan is going and how you’re tracking against the plan, and if you need to revisit the plan. But operators and executives can’t rely on the same information the board sees; they need something much more current and much more consistent. And so, we actually find ourselves revisiting the plans monthly. […]

You can’t skip the annual process, and you must always expect that you’re going to have quarterly plans, but if you’re keeping track of things on a monthly basis, it does allow you to iterate and change the plan as needed so that you maximize the chances of hitting your goals.”

32:23 — Three Types of New Hires

There are velocity heads, which are those heads that are helping with sales. So, literally, I can tie productivity on the sales side to those heads, namely, AEs, SDRs, et cetera.

Then there are productivity or metrics driven heads — recruiting, managers, et cetera. 

And then there are what they call infrastructure heads or step-up heads. Finance is a good example. Like, there’s no metric to tell me when I need a finance analyst for the first time.

But this is more of a department leader or somebody knowing like, ‘Hey, we’ve reached the point where the work is enough for us to staff ahead. Otherwise, things will break.”

41:46 — Software vs. Spreadsheets

“There are three things that come to mind. The first one is consistency. If you’re building things in spreadsheets, that’s definitely going to create a lot of issues. And so, by having consistency in its format and providing a place that everyone goes to as this single source of truth, technology is a huge component in a headcount planning process.

The second one is going to be collaboration. You can just collaborate on a system much more effectively if it’s designed for collaboration than you ever could on a spreadsheet. If you’ve tried commenting on a Google Sheet and kind of keeping track of that, you know how painful that process is, or worse, you’re passing around different versions of the document, and you can’t find information, or somebody deleted a sheet. 

The third one is just interconnectivity. A spreadsheet is not good at connecting with other systems, but technology can do so.”

Full Transcript