HUMAN RESOURCE PLANNING

Presented by, Subhash Kumar & Ajay Kumar Gupta

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Learning Objectives
Concept

of Human Resource Planning. of Human Resource Planning.

Objectives Need

and importance of Human Resource Planning.

Process Factors

of Human Resource Planning.

affecting Human Resource Planning. in Human Resource Planning. for effective Human Resource
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Problems

Guidelines

Planning.

Human Resource Planning

Human Resource (HR) Planning

The process of analyzing and identifying the need for and availability of human resources so that the organization can meet its objectives.

HR Planning Responsibilities
Top HR executive and subordinates gather information from other managers to use in the development of HR projections for top management to use in strategic planning and setting organizational goals

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Human Resource Planning

Human resources planning in the broadest sense includes both strategic and operational human resource planning as a continuous process rather than an activity limited to a fixed segment of the business planning process. It is also called as manpower planning.

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DEFINITIONS
HRP is a process by which manager ensure that they have the right number and kind of capable people in the right places and at the right times. - Robbins & Coulter Manpower planning is the strategy for acquisition, utilization, improvement and preservation of an organizations human resources. -G. Stainer
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HR PLANNING & STRATEGIC PLANNING

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Objectives of HR Planning.
To ensure optimum use of existing human resources. To forecast future requirements of human resources. To assess the shortage and surplus of human resources. To anticipate the impact of technology on jobs and human resources. To link human resources planning with organizational planning.

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Objectives of HR Planning.(contd.)
To provide control measures for human resources. To determine levels of recruitment and training. To meet the needs of expansion and diversification programmes. To estimate the cost of human resources.

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Importance of HR Planning
It ensures the adequacy of well trained persons for future needs. It identifies gaps in existing manpower in terms of their quantity and talent. It facilitates the expansion and diversification of an organization. It helps in effective utilization of technological progress. It is helpful in anticipating the cost of human resources which facilitates the budgeting process.

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HR planning Determine number and type of jobs to be filled. Match human resource availability with job openings. Human resource supply

Human resource demand

Human resource requirements: numbers skills qualifications occupation performance experience career goals

Human resource inventory: numbers skills qualifications occupation performance experience career goals

Variances

Nil

No action
If surplus Stop recruiting Reduce casual and part-time employment Start early retirements Start retirements Start retrenching Reduce working hours If shortage Increase overtime Increase casual and part-time employment Postpone retirements Start recruiting Accelerate training and development Use outsourcing

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Managers must ask:

1. 2. 3. 4. 5. 6.

What mix of knowledge, skills and abilities do we require now? What mix will we require in the future? Do we have the right number of qualified employees today? How will employee numbers change in the future? How do our labour costs and productivity compare with those of our competitors? Where will we find the people we need?
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Factors That Determine HR Plans

Figure 23
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HR Planning Process

Figure 26
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Scanning the External Environment

Environmental Scanning
The process of studying the environment of the organization to pinpoint opportunities and threats.

Environment Changes Impacting HR

Governmental regulations Economic conditions Geographic and competitive concerns Workforce composition

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Internal Assessment of the Organizational Workforce

Auditing Jobs and Skills

What jobs exist now? How many individuals are performing each job? How essential is each job? What jobs will be needed to implement future organizational strategies? What are the characteristics of anticipated jobs?

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Internal Assessment of the Organizational Workforce

Organizational Capabilities Inventory

HRIS databasessources of information about employees knowledge, skills, and abilities (KSAs) Components of an organizational capabilities inventory
Workforce and individual demographics Individual employee career progression Individual job performance data

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Forecasting HR Supply and Demand

Forecasting
The use of information from the past and present to identify expected future conditions.

Forecasting Methods
Judgmental
Estimatesasking managers opinions, top-down or bottom-up Rules of thumbusing general guidelines Delphi techniqueasking a group of experts Nominal groupsreaching a group consensus in open discussion

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Forecasting HR Supply and Demand

Forecasting Methods (contd)

Mathematical
Statistical regression analysis Simulation models Productivity ratiosunits produced per employee Staffing ratiosestimates of indirect labor needs

Forecasting Periods
Short-termless than one year Intermediateup to five years Long-rangemore than five years

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Forecasting Methods

Figure 28
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Forecasting HR Supply and Demand

Forecasting the Demand for Human Resources

Organization-wide estimate for total demand Unit breakdown for specific skill needs by number and type of employee
Develop decision rules (fill rates) for positions to be filled internally and externally. Develop additional decision rules for positions impacted by the chain effects of internal promotions and transfers.

Forecasting the Supply for Human Resources

External Supply Internal Supply
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Forecasting HR Supply and Demand

Forecasting External HR Supply

Factors affecting external
Net migration for an area Individuals entering and leaving the workforce Individuals graduating from schools and colleges Changing workforce composition and patterns Economic forecasts Technological developments and shifts Actions of competing employers Government regulations and pressures Other factors affecting the workforce

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Estimating Internal Labor Supply for a Given Unit

Figure 29
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Managing Human Resource Surplus or Shortage

Workforce Reductions and the WARN Act

Identifies employer requirements for layoff advance notice.
60-day notice to employees and the local community before a layoff or facility closing involving more than 50 people. Does not cover part-time or seasonal workers. Imposes fines for not following notification procedure. Has hardship clauses for unanticipated closures or lack of business continuance capabilities.

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Managing Human Resource Surplus or Shortage

Workforce Realignment
Downsizing, Rightsizing, and Reduction in Force (RIF) all mean reducing the number of employees in an organization. Causes
Economicweak product demand, loss of market share to competitors Structuraltechnological change, mergers and acquisitions

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Managing Human Resource Surplus or Shortage

Workforce Realignment (contd)

Positive consequences
Increase competitiveness Increased productivity

Negative consequences
Cannibalization of HR resources Loss of specialized skills and experience Loss of growth and innovation skills

Managing survivors
Provide explanations for actions and the future Involve survivors in transition/regrouping activities

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Managing Human Resource Surplus or Shortage

Downsizing approaches
Attrition and hiring freezes
Not replacing departing employees and not hiring new employees/

Early retirement buyouts

Offering incentives that encourage senior employees to leave the organization early.

Layoffs
Employees are placed on unpaid leave until called back to work when business conditions improve. Employees are selected for layoff on the basis of their seniority or performance or a combination of both.

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Managing Human Resource Surplus or Shortage

Downsizing approaches (contd)

Outplacement services provided to displaced employees to give them support and assistance:
Personal career counseling Resume preparation and typing services Interviewing workshops Referral assistance Severance payments Continuance of medical benefits Job retraining

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Factors affecting Human Resource Planning

Scarcity of talent Increasingly, what concerns managers is the scarcity of talent. One of the most significant factors contributing to the companys outstanding performance is the quality of its people. Attracting talent and retaining talent has now become a major driver of corporate strategy. A companys talent, moreover, is increasing in importance as a determinant of its price share.
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Factors affecting HR Planning (contd.)

The major problems facing Sydney, Hong Kong, Singapore in their quest to be the business hub of the Asia Pacific region are their lack of skilled people and a talent brain drain. Australia, for e.g., has a persistent shortage of medical, nursing, teaching, accounting, engineering and technical employees and people with trade skills.

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Factors affecting HR Planning (contd.)

Environmental factors As part of the strategic process, HR planning considers both the internal and external environmental influences on an organization, its objectives, culture, structure, systems and HRM policies and procedures
This

is because HR planning must reflect the environmental trends and issues that affect an organization's management of its human resources, including:
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Factors affecting HR Planning (contd.)

Economic

factors - (for e.g., Australias high income tax rates make it difficult and expensive to attract international executives) factors (for e.g., jobs shunned by Americans as being too hard, too dirty or too menial are done by illegal workers)

Social

Demographic

factors (for example, one in six Hong Kong residents will be 65 or older by 2015)
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Factors affecting HR Planning (contd.)

Technological

factors for e.g., the internet has made geographical location irrelevant, giving organizations the power to transfer jobs from rich countries with expensive labour to poor countries with cheap labour Microsoft is shifting US-based jobs to India in an effort to reduce technical support and development costs.

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Factors affecting HR Planning (contd.)

Globalization Globalization is allowing skilled labour to move like capital across the world to locations that offer the best compensation and the best future. The United States attracts more educated immigrants than the rest of the world combined.
Australia

is losing more than 80 000 residents per year - the majority being academics, managers and professionals primarily to Britain, Hong Kong, Singapore and the US.

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Factors affecting HR Planning (contd.)

China, India and Japan are also suffering brain drains. Up to 50 percent of Indias top engineering and science graduates and 20 per cent of its medical graduates leave each year for jobs overseas. All these factors affect the type and availability of labour.

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HR PLANNING FAILURE

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Problems in Human Resource Planning

Possibility

of inaccuracy, because it is based on forecasting. Employees & Employers resistance. Uncertainties in environment. Lack of top management support. Expensive and Time consuming. Lack of adequate database of human resources.

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Effective HR Planning
The

HR Plan needs to be fully integrated to the organisations business plan. There should be a special cell within the HR department to provide adequate focus. It should be within the limits of the budget along with support from top management. There should be a balance between the quality and quantity of human resources. There should be adequate database for human resources.
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References

Human Resource Management:- C.B. Gupta Wikipedia.com

Google.com

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?
Any Query
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Thank You
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