Human Resource Planning

Human Resource (HR) Planning is the practice of determining and analysing the requirement for

and supply of workforce in order to achieve the organisation’s goals and objectives, fulfil its

mission and reach its vision (Mathis & Jackson, 2000). HR planning predicts forces that will

affect the availability and requirement of employees in the future. This process will result in top

executives having superior analysis of human resource measurement for its decision making; HR

expenditure being decreased due to the fact that management can forecast imbalances prior to

them becoming costly; additional time will be available to place skills since requirements are

predicted and analysed before staffing is done; excellent opportunities are present to comprise

female and ethnic groups in upcoming developments; training of new managers can be

improved. The outcomes of these can be calculated and can be used for the evaluation of the

accomplishments of HR planning (Mathis & Jackson, 2000).

Human resource planning is a course of action that will aim to facilitate the organisation’s plan

in recruiting, improvement and training, substitution, cross-functional development and

management of programs for benefits and rewards. Subsequently to guarantee in building the

best valuable human resource plan, the organisation should analyse the necessity of a strategic

business plan, work proficiency plan, workforce planning, training and improvement planning,

career development planning and planning for right-sizing (Macaleer & Shannon, 2003).

Undeniably because of this analysis in HR planning, it is essential to have a sufficient Human

Resource Information System (HRIS). The purpose of this is providing accurate, balance and on

time information for the process. Now a computer-based system should provide a form of

information about human resources necessary for strategic business decision making. This

system reflects the relationship between work requirements, employee’s individual skills and

levels of performance. In this instance, the information system serves as simple reflections of

reality which will help develop better and effective business decisions which are known results

in the codification of knowledge (Liff, 1997).

In HR planning, external environmental forces should be considered such as present technology,

political climate, economic situation, legal issues, social responsibility and cultural differences.

Besides these external considerations are extremely important to HR activities especially, if HR

planning is globally implemented. The serious pressures that are involve in a business are

scarcity of talents, fast shifting technology, government regulations, environment, health, safety

and changes in the market. In this situation, the human resource planning innovations of the

company are affected. This will make sure that the organisation has the right work force with the

right skills in the right jobs at the right moment. There is no argument that human resource

planning should be associated with the strategic goals of the company. Hence, human resource

planning is an important factor in managing an organisation competently and successfully.

Accordingly, HR planning positively improves organisation performance if the HR plan is

strategy-based and human resource is a convincing strategic collaborator (Macaleer & Shannon,

2003).

Most parts of the world may be in recession and economies are in disorder will result in

worldwide effects on organisations and businesses. Any type of HR planning is presented with a

surmountable differences of opinion connected with unpredictable and uncertain times. In this

case, if the planning is done by HR professionals who have superior knowledge of magnitude

and quality of essential resources needed for revitalization, there is optimism of future positive

outcomes. According to Robert A. Simpkins (2009), an organisational adviser and educator,

there are two types of plans. One is designed to guarantee ‘business continuity’ in the appearance

of manmade or natural catastrophe. Second is a plan that is framed for the ‘uncertainty’ of the

business environment. HR planning is the most critical part of the organisation’s strategic plans

for the reason that observing and adjusting for environmental changes will make the success of

the process. All the drivers of the company’s internal and external environment are altering at an

accelerating speed including advancements in technology with respect to hardware, software and

connectivity, globalization, shifting of sources and consumers, changing competition, changes in

markets, the alteration of demographics, change of population lifestyle, the macro and micro

changes in economics and the progressively more bewildering government and international

regulations (Simpkins 2009). Businesses have the desire to stay significant in the face of

consumers and stakeholders. Mostly, the organisations that maintained their importance have

built remarkable HR plans that are continually reviewed and modernized. Regrettably, other

businesses build better folders that compose overall strategic human resources plans that are

short of any back-up planning, and these stay behind on the shelf gathering dust for years,

inappropriate to a present shifting business climate. Finally, Simpkins (2009) concludes that an

organisation needs to design a communicable HR plan that is not detailed enough to slow down

operation. Since HR professionals are with higher-level of understanding, the group will have the

elasticity to adjust what will take place in the future. The solution to a positive result is to keep

HR plan flexible (Simpkins, 2009).

Human resources issues have been the first among all business issues to affect the outcome of a

business organisation. Human resources have risks and these risks are the challenges that

resulted from managing your employees, processes and procedures. Therefore by dealing with

these risks in HR and finance, one can make positive organisational outcomes. On the other

hand, if these issues are not addressed appropriately these possibly will cause major harm to the

business (Steffee, 2008).

Public personnel management research and practices increasingly focus on creative human resource management (HRM) strategies for recruiting individuals with Information Technology (IT) expertise and retaining employees with institutional knowledge, particularly in light of impending retirements. Some agencies face unique workforce demographic challenges, while others face shifts in missions or technologies. For these reasons, the U.S. Office of Personnel Management relaxed some regulations to allow federal agencies to meet their staffing needs (Mastracci, 2009, p. 19).

With regards to staffing needs, workforce planning is the course of action that companies utilize

to recognize and deal with the staffing implications of their strategic human resources plans or

change of business plans. Workforce planning has a sole objective, to develop a long term

perspective within which short term workforce decisions can be achieved efficiently. Staffing

strategy is a long term plan that makes sure that availability of employees matches its

requirement for employees. Staffing plans illustrate short term plans which an organisation will

make in the immediate future to deal with staffing gaps and excesses. By implementing this

procedure, the businesses can make certain it has the accurate quantity of people, with the

appropriate skill, in position at the right moment. Workforce planning can facilitate the execution

of business changes and innovations. The growth in organisations is anticipated overtime during

the workforce planning phases. This process is essential in determining the staffing that would be

required for growth that will make sure the needed skills will be obtainable to accomplish those

development goals. It also allows a business company to construct and implement downsizing

plans in the best efficient method. The absence of this strategy makes it hard to identify staffing

reductions that have a positive effect on the future of the organisation (Bechet, 2008).

Rightsizing or downsizing or organisational decimation is a persistent strategic human resource

practice for the last thirty years (Gandolfi, 2008). This refers to the planned removal of big

quantity of workforce intended to improve organisational efficiency. In fact, this process is a

commonly accepted company solution in times of financial difficulties of the organisation.

Although studies show enough indication that rightsizing companies is not generally a successful

method of reaching goals of optimum output and maximum profit. However, rightsizing

sometimes cannot be avoided; workforce reduction ought to be a management means of last

resort rather than first option. For the duration of an economic recession, an organisation should

think of all its options and examine the viability and applicability of cost-reduction alternatives

before considering rightsizing. In fact predicting a business decline can be very hard, therefore,

organisations have the immediate reaction rather than forecasting economic downturns

(Gandolfi, 2008).

Take the case of IBM, although the company planned to steer clear of downsizing its workforce

however, the company declared plans of workforce reduction and by the early 1990’s IBM right

sized its organisation by decreasing its employment by 40,000 at that time alone. However, IBM

made an effort to become reactive by changing products and attempted to acquire the promptness

and responsibility edges of fast reacting manufacturers (Greer, 2001).

On the other hand, back in the 1980’s a small number of organisations marked workforce

planning and marked as part of their human resource strategy. AT&T and some large oil firms

were the models of this. Due to the fact that having a large volume of employees, these

organisations called for some forms of workforce planning. AT&T made recognition for its

succession planning, evaluation and career advancement programs. Rightsizing and reorganising

achieved momentum for this time period. Strategic human resource was beginning to expand and

become increasingly strategic because of the fast growing economy and globalisation at the end

of the decade (Gubman, 2004).

In another case, similar to any big organisations, Eastman Kodak has tried with a variety of

human resource planning programs for the past decades. One of the successful programs centred

on workforce requirements. HR planning by that time was perceived as a method to make certain

that the right number and right kind of employees were at the right position at the right moments.

Skills assessments were believed to be the suitable base for HR planning. Similar to any firm,

Kodak discovered that there were no general definitions of HR planning. The company realised

that they ‘borrowed, adapted, discovered and created’ their way to an approach to HR planning

that was aligned to the market situation at that time and be reactive to its changes (Bennet &

Brush, 2007).

We have developed a framework and process for thinking about and doing HR planning, which I’ve labelled: “HR planning in “3D.” The three dimensional environment at Eastman Kodak – diversity, decentralisation, and dynamism – has significantly affected the character and objectives of the HR planning process (Bennet & Brush, 2007, p. 46).

In this concept, the human resource function at Eastman Kodak Company was restricted with the

goals on magnifying the strategic dimensions of human resource management. In this situation,

HR is reshaped as a foundation of market competitive edge and new HR planning procedures

were built to strengthen this edge. In the 1990’s, the implementation of this procedures required

new HR abilities. The company’s made efforts to utilize HR planning to create a tougher and

more aggressive corporation (Bennet & Brush, 2007).

We have found several key integrative elements which, from an HR standpoint, seem to make sense in a “3D” environment. These elements are: corporate management themes; HR planning processes; and HR competencies. Working together, in an ensemble of influence and activity, these elements help to create, sustains, and reinforces strategic business unity (Bennet & Brush, 2007, pp. 48-49).

Corporate management themes facilitate in building a focus for a united business environment to

achieve its objectives. As of HR planning processes, planning is staged at the corporate and

business points. In this process, Eastman Kodak Company is creating efficient HR staff and on

this level, this will make the company’s HR planning a ‘competitive weapon in our business

arsenal’ (Bennet & Brush, 2007). In the belief that the existing process of uniting and

sharpening the corporation’s HR goals will result in considerable outcomes over the decades by

concentrating our efforts and finances and giving to the corporation’s evolution. In HR

competencies, HR planning is designed to support the Kodak Company by developing its ability

to face the future and having the objective for improvement of Corporate Relations. An efficient

production HR team, a competent HR planning process and the corporate themes put together

will create unity of goals and objectives and create production’s capability to implement strategy.

On the whole, the Kodak Company started to distinguish the advancement and positive results as

the outcome of knowledge acquired on this process. As Kodak Company has started to achieve

its goals, there is an opportunity for transformation of HR functions. The corporation anticipate

that successful HR planning, in a ‘3D environment’, will be Kodak’s ‘vehicle for landing safely

in the 21’st century’ (Boroski, 1990).

The point of view on the Annual HR Strategic Planning Process of Corning Incorporated is that

the HR staff employs to make HR investments and services the main concern in support with

business needs. Overtime, this procedure has contributions from Human Capital Planning

process, HR objectives and other organisation innovations. To efficiently attached HR strategy

with business strategy a Human Capital Planning process was created in Corning Incorporated.

The outcome gave managers tools and skills for ability development and gave HR a method of

determining requirements over the organisation. To allow the determination of the skill that will

affect the positive outcome of business strategy, HR planning should find out the quantity of

employees needed and determine talent gaps. Incorporating both the workforce planning and

operating plan process have facilitated to create a more aligned global HR function for Corning

Incorporated. Important components of a good HR planning process are composed of different

methods for collecting information; corporate strategy input from top executives; direction from

top managers and business participation from each business facilitated by HR function.

Furthermore, placement of the HR planning process with the business strategy procedures

enhances HR’s capacity to support the functions it presents with the requirements for its market

(Bennet & Brush, 2007).

In the early 1990’s, in order to meet Colgate-Palmolive Company’s objective of ‘becoming the

best truly global consumer products company’ (Khanna & Randolph, n.d.) it human resources

made the building of its human resources strategy. The corporation is continually dedicated to

developing the human resources for sustainable competitive edge in the global market. The HR

strategy team was grouped into Geographic Excellence, Category Excellence and Functional

Excellence. The Global Human Resources Business Plans is nothing until it is put into action.

Colgate should consider consumer’s needs in order to accomplish the innovations of HR

planning. HR plays an important part to assist Colgate employees to continually improve. HR

makes an effort with management to build training, career planning, performance development,

communications and reward systems. The process will make sure that Colgate employees have

the chance for advancement, empowerment and continually improve its abilities (Smith, Boroski

& Davis, 1992).

On other respects, the organisation that is considering outsourcing, HR planning staff should be

active partners of workforce planning processes. In the present economic situation, active human

resource planning processes integrating flexible workforce preparations are adapted to a much

greater degree. Outsourcing is not only part of workforce planning besides it is also a tool in

human resource planning. HR planners should be part of the organisational change: evaluation,

contract negotiation, transition and stabilisation as these control decisions of the process. HR

planning should have the control of the decisions and as the effect of its absence of this practices

may result in failures (Khanna & Randolph, 2005).

The social responsibility of business encompasses the economic, legal, ethical and discretionary expectations that society has of organisations at a given point in time. The social responsibilities of a business include to produce goods or services, to make a profit, to obey the laws and regulations, to act ethically, to consider the public good in every decision that is made and to place ethics above personal gains. To be socially responsible a person or business must consider all aspects of society when making a decision. (Clark & Seward, 2000, p. 52)

In human resource planning the process should incorporate the highest level of social

responsibility. As Milton Friedman maintains that a business organisation has no social

responsibilities other than to get the highest possible profits (Ramlall, 2009). In spite of this

belief, now there is a general awareness among business organisations that sustainable

achievement and stockholders share value cannot be materialised by maximising production but

rather by having social responsible attitude (Ramlall, 2009).

In another case, human resource should consider employee participation for good governance

and corporate social responsibility. As an evidence of its importance is that, it is the basis as a

legal tool in composing international institutions to regulate global corporations. In spite of this,

business corporations make a general view in making HR procedures regarding the

implementation of corporate social responsibility policies and personal views on employee

relations that will affect the overall view of labour relations (Daugareilh, 2008).

For multinational corporations like Enron, WorldCom and Citigroup, ethics are the most

important aspect as an organisation. Everyday all kinds of organisations have to face some kind

of moral issue that has the making of a scandal that sometimes will end up in the multimedia

business sections. In today’s era, it is a challenge to confront moral dilemmas such as workforce

retention, attracting people, promotion, pay, sexual harassment and other HR practices. How a

business corporation will respond to these moral issues will affect organisational environment

and will also incite legal actions and will result a negative perception from investors and

consumers. Human resource planning practises call for not only reaching organisational

objectives besides it will also institute and sustain these processes around ethical grounds (Kubal,

Baker & Coleman, 2006).

HR staff should have the foresight and the character to incorporate in its practises the various

value systems in a business corporation. Although this is not just idealism, global competitions

compel HR orientation to focus on profit. HR planning practices must consider decisions that

are driven by the business or driven for the business. HR should lead as the guardians of the

organisation’s strategic ability. Likewise HR practises must also be the guardians of the whole

organisation’s ethical and moral integrity (Wright & Snell, 2005).

Unquestionably, in having human resource management program it must recognize laws and

regulations in dealing with its people. This will make the legal environment of human resources.

Due to the fact that this is a complicated aspect of the organisation, this increasingly involves

Human Resource Management. Persistent labour laws must be taken into consideration in

overall Human Resource Planning formulation because in practising legal compliance is usually

the source of strategic edge in the human resource management point of view (Greer, 2001).

Human resource management policies and practices are designed to decide employee’s

disagreements and make workplace justice. Similarly, an ethical decision to arrive at a solution

to this dilemma is the innate character of human resource management practices and has brought

about changes to Australian labour laws. Human Resource management role as a ‘strategic

partner’ and also the one who will look after employees’ welfare cannot be seen as a neutral

overseer of workplace disputes. That is why a development of a code of ethics should be

considered when creating human resources planning processes (Van Gramberg &Teicher, 2006).

Take the case in workforce resizing under human resource planning processes, there are legal

implications in this situation. With regards to employing and terminating people in an

organisation, there is training involved that covers different fair employment and

antidiscrimination laws. A typical case in this matter was the case of United Steelworkers of

America v. Weber (1979). Brian Weber sued Kaiser Aluminum and his union for racial

discrimination (Clardy, 2003).

On the whole, Human Resource (HR) planning is the process of combining human resource

procedural plans with strategic business plans. HR planning is integrated along the whole of the

business planning process. After identifying business goals and objectives, HR planning

practices deal with building the workforce, capabilities and management needed to implement

the strategic plans. HR planning is created to make sure that the organisation has the important

ability to compete in the business world considering the unpredictability of today’s economy.

External environment considerations such as economic, social, legal, cultural, political, ethics

and technology should be taken into account since this will influence HR planning. The concept

of HR planning of Eastman Kodak, Corning and Colgate Palmolive is to develop organisational

capability that both will facilitate the innovation of human resource management strategy and

integrating this with the companies’ business strategy.

Reference:

Bechet, T 2008, Strategic Staffing 2nd ed., Amacom, New York.

Bennett, D & Brush, M 2007, ‘The annual HR strategic planning process: design and facilitation lessons from Corning Incorporated human resources’, Organization Development Journal, vol. 25 issue 3, pp. P87-P93, (online EBSCOhost).

Borski, J 1990, ‘Putting it together: HR planning in “3D” at Eastman Kodak’, Human Resource Planning, vol. 13 issue 1, pp .45-57, (online EBSCOhost).

Clardy, A 2003, ‘The legal framework of human resources development, part II: fair employment, negligence, and implications for scholars and practitioners’, Human Resources Development Review, vol. 2, no. 2, pp. 130-154, (online Sage Journals).

Clark, R & Seward, J 2000, Australian Human Resources Management Framework & Practice 3rd ed., McGraw-Hill, Roseville.

Daugareilh, I 2008, ‘Employee participation, ethics and corporate social responsibility’, Transfer: European Review of Labour and Research, vol. 14, pp. 93-110. (online Sage Journals).

Gandolfi, F 2008, ‘Cost reductions, downsizing-related layoffs, and HR practices’ SAM Advanced Management Journal, vol. 73, issue 3, pp. 52-58, (online EBSCOhost).

Gubman, E 2004, ‘HR strategy and planning: from birth to business results’, Human Resource Planning, vol. 27 issue 1, pp. 13-23, (online EBSCOhost).

Greer, C 2001, Strategic Human Resource Management A General Managerial Approach 2nd ed., Prentice-Hall, Inc., New Jersey.

Khanna, S & Randolph, J 2005, ‘An HR planning model for outsourcing’, Human Resource Planning, vol. 28 issue 4, pp. 37-43, (online EBSCOhost).

Kubal, D, Baker, M & Coleman, K 2006, ‘Doing the right thing: how today’s leading companies are becoming more ethical’, Performance Improvement, vol. 45 issue 3, pp. 5-8, (online EBSCOhost).

Liff, S 1997, ‘Constructing HR information systems’, Human Resource Management Journal, vol. 7, no. 2, pp. 18-31, (online Moodle).

Macaleer, B & Shannon, J 2003, ‘Does HR planning improve business performance?’, Industrial Management, vol. 45, issue 1, p. 15, (online EBSCOhost).

Mastracci, S 2009, ‘Evaluating HR management strategies for recruiting and retaining IT professionals in the U.S. federal government’, Public Personnel Management, vol. 38, issue 2, pp. 19-34, (online EBSCOhost).

Mathis, R & Jackson, J 2000, Human Resource Management 9ed, South-Western College Publishing, Cincinnati.

Ramlall, S 2009 ‘Continuing the HR evolution: building resilience in turbulent economic times’, International Journal of Global Management Studies, vol. 1, issue 3, pp. 19-28, (online EBSCOhost).

Simpkins, R 2009, ‘HR’s critical role in contingency planning’, Employment Relations Today, vol. 36, issue 2, pp. 21-27, (online EBSCOhost).

Smith, B, Boroski, J & Davis, G 1992, ‘Human resource planning’, Human Resource Management, vol. 31, no. 1-2, pp. 81-93, (online EBSCOhost).

Stefee, S 2008, ‘HR risks are largely ignored’, Internal Auditor, vol. 65, issue 6, pp. 14-15, (online EBSCOhost).

Van Gramberg, B & Teicher, J 2006, ‘Managing neutrality and impartiality in workplace conflict resolution: the dilemma of the HR manager’, Asia Pacific Journal of Human Resources, vol. 44,  2, pp. 197-210, (online Sage Journals).

Wright, P & Snell, S 2005, ‘Partner or guardian? HR’s challenge in balancing value and values’, Human Resource Management, vol. 44, issue 2, pp. 177-182, (online EBSCOhost).