Human Resource PlanningHuman Resource Planning

HUMAN RESOURCE HUMAN RESOURCE MANAGEMENTMANAGEMENT

SL HR 502

SEMESTER II

PRODUCTIVITY

ECONOMICDEVELOPMENT

GROWTH

EFFECTIVE

UTILIZATION

OF

HUMANCAPABILITY

Human Resource Human Resource PlanningPlanning

Effective planning of HR is Effective planning of HR is essential to match the requirements essential to match the requirements of the job with the individualof the job with the individual Right resources at the right time Right resources at the right time to meet the future organizational to meet the future organizational needs is criticalneeds is critical A comprehensive and meticulous A comprehensive and meticulous HRP process can ensure sustained HRP process can ensure sustained growth of an organizationgrowth of an organization

Human Resource Human Resource PlanningPlanning

Diversification or expansion, employee Diversification or expansion, employee promotion or changes in human resource promotion or changes in human resource necessitates effective HRPnecessitates effective HRP Organizational plans, goals, and Organizational plans, goals, and strategies also needs effective HRPstrategies also needs effective HRP Success in business is dependent on Success in business is dependent on being able to react quickly to being able to react quickly to opportunitiesopportunities Organizations must have accurate, Organizations must have accurate, rapid access to information about both rapid access to information about both supply of and demand for HR supply of and demand for HR

Organizational Life-Cycle Stages Organizational Life-Cycle Stages HR ActivitiesHR Activities

LIFE-CYCLE LIFE-CYCLE STAGESTAGE STAFFINGSTAFFING COMPENSATIONCOMPENSATION

TRAINING AND TRAINING AND DEVELOPMENTDEVELOPMENT

LABOR / LABOR / EMPLOYEE EMPLOYEE RELATIONSRELATIONS

Introduction Attract best Attract best technical technical and and professional professional talenttalent

Meet or exceed Meet or exceed labor market labor market rates to attract rates to attract needed talentneeded talent

Define future Define future skill skill requirements requirements and begin and begin establishing establishing career ladderscareer ladders

Set basic Set basic employee-employee-relations relations philosophy philosophy of of organizationorganization

Growth Recruit Recruit adequate adequate numbers and numbers and mix of mix of qualifies qualifies workers. Plan workers. Plan management management succession. succession. Mange rapid Mange rapid internal labor internal labor market market movementsmovements

Meet external Meet external market but market but consider consider internal equity internal equity effects. effects. Establish Establish formal formal compensation compensation structuresstructures

Mold effective Mold effective management management team through team through management management development development and and organizational organizational developmentdevelopment

Maintain Maintain labor labor peace, peace, employee employee motivation motivation & morale& morale

Organizational Life-Cycle Stages and Organizational Life-Cycle Stages and HR ActivitiesHR Activities

LIFE-LIFE-CYCLE CYCLE STAGESTAGE

STAFFINGSTAFFING COMPENSATIONCOMPENSATIONTRAINING AND TRAINING AND DEVELOPMENTDEVELOPMENT

LABOR / LABOR / EMPLOYEE EMPLOYEE RELATIONSRELATIONS

Maturity Encourage Encourage sufficient sufficient turnover to turnover to minimize layoffs minimize layoffs and provide new and provide new openings. openings. Encourage Encourage mobility as mobility as reorganizations reorganizations shift jobs aroundshift jobs around

Control Control compensacompensation coststion costs

Maintain Maintain flexibility flexibility and skills and skills of an of an aging aging workforceworkforce

Control Control labor costs labor costs & maintain & maintain labor peace. labor peace. Improve Improve productivityproductivity

Decline Plan and Plan and implement implement workforce workforce reductions and reductions and reallocations, reallocations, downsizing and downsizing and outplacement outplacement may occur may occur during this during this stagestage

Implement Implement tighter cost tighter cost controlcontrol

Implement Implement retraining retraining and career and career consulting consulting servicesservices

Improve Improve productivity productivity and achieve and achieve flexibility in flexibility in work rules. work rules. Negotiate job Negotiate job security and security and employment-employment-adjustment adjustment policiespolicies

Human Resource Human Resource PlanningPlanning

HRP is both a process and a set of HRP is both a process and a set of plansplans

– a process by which management of an a process by which management of an organization determines its future HR organization determines its future HR requirementsrequirements– a plan to fill the future HR requirements a plan to fill the future HR requirements from internal and external sources from internal and external sources

Assessment of human resource Assessment of human resource requirements in advance vis a vis requirements in advance vis a vis organizational objectives, production organizational objectives, production schedules, and demand fluctuations schedules, and demand fluctuations

Human Resource Human Resource PlanningPlanning

‘ ‘The process of determining human The process of determining human resource requirements and the means of resource requirements and the means of meeting those requirements in order to meeting those requirements in order to carry out the integrated plan of the carry out the integrated plan of the organization’ – Colemanorganization’ – Coleman Relates to Relates to

– establishing job specificationsestablishing job specifications– determining the number of personnel determining the number of personnel requiredrequired– developing the sources of human resourcedeveloping the sources of human resource

Internal vs. ExternalInternal vs. External System of matching the available System of matching the available resources, either externally or resources, either externally or internally, with the expected internally, with the expected organizational demand over a period organizational demand over a period of timeof time Internal ResourcesInternal Resources

– employees who are already in the employees who are already in the organizationorganization

External ResourcesExternal Resources– personnel who have to be recruited personnel who have to be recruited from outsidefrom outside

Objectives of HRPObjectives of HRP Forecasting HR RequirementsForecasting HR Requirements

– maintain the required quantity & quality of HRmaintain the required quantity & quality of HR– turnover/attrition ratesturnover/attrition rates

Effective Management of ChangeEffective Management of Change– coping with changes in market conditions, coping with changes in market conditions, technology, govt. regulations et altechnology, govt. regulations et al

Realizing Organizational GoalsRealizing Organizational Goals– expansion, diversificationexpansion, diversification

Promoting EmployeesPromoting Employees– database on skill repertoiredatabase on skill repertoire

Effective Utilization of HREffective Utilization of HR– surplus/unutilized employees vis a vis downsizingsurplus/unutilized employees vis a vis downsizing

Emergence of HRPEmergence of HRPEarly HRP was top down, short Early HRP was top down, short

rangerange1970s: “manpower planning”1970s: “manpower planning”1990s: aligning HR strategy with 1990s: aligning HR strategy with

– corporate strategycorporate strategy– attention to individual career attention to individual career

planningplanning

Effective HRPEffective HRP An effective HRP An effective HRP

– closes the gap between the closes the gap between the current situation and a desired current situation and a desired situation in the context of an situation in the context of an organization’s strategyorganization’s strategy

– helps cope with change and helps cope with change and achieve organizational goalsachieve organizational goals

HR Planning LevelsHR Planning Levels HRP is carried out at different HRP is carried out at different

organizational levels to meet HR organizational levels to meet HR requirements at those levelsrequirements at those levels

Flow of communication in HRP is both Flow of communication in HRP is both waysways– Top to bottom Top to bottom – Bottom to topBottom to top

The levels areThe levels are– Corporate level planningCorporate level planning– Intermediate level planningIntermediate level planning– Operational level planningOperational level planning

HR Planning LevelsHR Planning Levels Corporate-level PlanningCorporate-level Planning

– Culture and mission of the organizationCulture and mission of the organization– Macro-level: changes in market conditions, Macro-level: changes in market conditions,

technology, strategic plan, etctechnology, strategic plan, etc– Identification of broad policy issues; employment, Identification of broad policy issues; employment,

welfare, development policieswelfare, development policies Intermediate-level PlanningIntermediate-level Planning

– SBU level, based on corporate-level HR PlanSBU level, based on corporate-level HR Plan– Determining recruitment, retaining, laying offDetermining recruitment, retaining, laying off

Operational-level PlanningOperational-level Planning– Operations level planOperations level plan– Training & development, recruitment etcTraining & development, recruitment etc

Planning Short-term ActivitiesPlanning Short-term Activities– Management of day-to-day activitiesManagement of day-to-day activities– Ensure success or failure of corporate plansEnsure success or failure of corporate plans– Grievance handling, etc Grievance handling, etc

Environmental Scanning

impact of strategy/goals on diff. units

Forecastingquantity & quality of personnel needed

Involving Line Managersdetermining HR needs of departments

Analysis of Supplymatching current HR supply & reqmnt

HRP

PROCESSPlan of Action

recruitment, selection, training, et al

Human Human Resource Resource PlanningPlanning

Predict demand

Forecast internal supply Forecast external supply

Assess trends in• External labor markets• Current employees• Future organizational plans• General economic trends

Compare future demandand internal supply

Plan for dealing with predict-ed shortfalls or overstaffing

Situation AnalysisSituation Analysis Interaction of HRM and strategic planningInteraction of HRM and strategic planning The strategic plan must adapt to The strategic plan must adapt to

environmental circumstancesenvironmental circumstances HRM is one of the mechanisms of HRM is one of the mechanisms of

adaptation processadaptation process Example: rapid technological changes can Example: rapid technological changes can

force an organization to quickly identify force an organization to quickly identify and hire employees with new skillsand hire employees with new skills

Without HR plan to support the Without HR plan to support the recruitment & selection functions it would recruitment & selection functions it would be impossible to move fast to stay be impossible to move fast to stay competitive competitive

ForecastingForecastingEstimating not only ‘how many’ but Estimating not only ‘how many’ but

also ‘what kinds’ of employees will also ‘what kinds’ of employees will be neededbe needed

Yields advance estimates or Yields advance estimates or calculations of the organization’s calculations of the organization’s staffing requirementsstaffing requirements

Apart from quantitative tools, a great Apart from quantitative tools, a great deal of human judgement is involveddeal of human judgement is involved

Incredibly difficult tasks, especially in Incredibly difficult tasks, especially in rapidly changing environmentrapidly changing environment

Forecasting TechniquesForecasting TechniquesQualitative TechniquesQualitative Techniques

– Expert estimateExpert estimate– Nominal Group Technique (NGT)Nominal Group Technique (NGT)– Delphi TechniqueDelphi Technique

Quantitative TechniquesQuantitative Techniques– Regression AnalysisRegression Analysis– Productivity RatiosProductivity Ratios– Personnel RatiosPersonnel Ratios– Time Series AnalysisTime Series Analysis

The Nominal Group The Nominal Group TechniqueTechnique

A small group of 4-5 people gathers around a table. Leader identifies judgment issue and gives participants procedural instructions

Participants write down all ideas that occur to them, keeping their lists private at this point. Creativity is encouraged during this phase

Leader asks each participant to present ideas and writes them on a blackboard or flipchart, continuing until all ideas have been recorded

Participants discuss each other’s ideas, clarifying, expanding, and evaluating them as a group

Participants rank ideas privately in their own personal order and preference

The idea that ranks highest among the participants is adopted as the group’s judgment

The Delphi TechniqueThe Delphi TechniqueLeader identifies judgment issues and develops questionnaire

Prospective participants are identified and asked to cooperate

Leaders send questionnaire to willing participants, who record their judgments and recommendations and return the questionnaire

Leaders compiles summaries and reproduces participants’ responses

Leader sends the compiled list of judgment to all participants

Participants comment on each other’s ideas and propose a final judgment

Leader looksfor consensus

Leader accepts consensus judgment as group’s choice

Statistical TechniquesStatistical Techniques NameNameRegression analysis

Productivity ratios

DescriptionDescription

Past levels of various work load indicators, such as sales, production levels, are examined for statistical relationships with staffing levels. Where sufficiently strong relationships are found, a regression (or multiple regression) model is derived. Forecasted levels of the retained indicator(s) are entered into the resulting model and used to calculate the associated level of human resource requirements.

Historical data are used to examine past levels of a productivity index (P):

P = Work load / Number of People

Where constant, or systematic, relationships are found, human resource requirements can be computed by diving predicted work loads by P.

Statistical TechniquesStatistical Techniques

NameName

Personnel ratios

Time series analysis

DescriptionDescription

Past personnel data are examined to determine historical relationships among the employees in various jobs or job categories. Regression analysis or productivity ratios are then used to project either total or key-group human resource requirements, and personnel ratios are used to allocated total requirements to various job categories or to estimate for non-key groups.

Past staffing levels (instead of work load indicators) are used to project future human resource requirements. Past staffing levels are examined to isolate and cyclical variation, long-tem terms, and random movement. Long-term trends are then extrapolated or projected using a moving average, exponential smoothing, or regression technique.

Analysing Current SupplyAnalysing Current Supply ““How many and what kinds of employees How many and what kinds of employees

do I currently have in terms of the skills do I currently have in terms of the skills and training necessary for the future?”and training necessary for the future?”

Are resources available – internally or Are resources available – internally or externally – to fill those needs?externally – to fill those needs?

InternalInternal– skills inventoryskills inventory– succession planningsuccession planning– promotabilitypromotability

ExternalExternal– availability of qualified labor; surplus? availability of qualified labor; surplus?

shortage?shortage?

Analysing Current SupplyAnalysing Current Supply The Skills InventoryThe Skills Inventory: tool to assess : tool to assess

current supply of employees in terms ofcurrent supply of employees in terms of– skillsskills– abilitiesabilities– experiencesexperiences– training training

If the current inventory exceeds the If the current inventory exceeds the future requirements and natural future requirements and natural attrition cannot bring down the attrition cannot bring down the resources to match the future resources to match the future requirements?requirements?

Employee Replacement Chart Employee Replacement Chart for Succession Planningfor Succession Planning

Managing Employee Managing Employee SurplusesSurpluses

Source: Compliments of Dan Ward, GTE Corporation

Managing Employee Managing Employee ShortagesShortages

Source: Compliments of Dan Ward, GTE Corporation

HRISHRISHuman Resource Information Human Resource Information

SystemSystem is more than just a is more than just a computerized skills inventorycomputerized skills inventory

An HRIS is an integrated approach An HRIS is an integrated approach toto– acquiringacquiring– storingstoring– analysinganalysing– controllingcontrolling the flow of information the flow of information

throughout an organizationthroughout an organization

HRISHRIS Highly developed HRIS systems can Highly developed HRIS systems can

increase efficiency and response increase efficiency and response time of HRM activitiestime of HRM activities

The system might contain a The system might contain a programme for tracking applicants, a programme for tracking applicants, a skills inventory, a career planning skills inventory, a career planning programme, employee service programme, employee service programmesprogrammes

One of the most common uses of an One of the most common uses of an HRIS is in recruitment and tracking of HRIS is in recruitment and tracking of applicantsapplicants