CH-5 Human Resource Planning

Chapter
Human Resource Planning

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Introduction
Human Resource Planning (also called employment or personnel planning)

is essentially the process of getting the right number of qualified people into
the right job at the right time so that an organisation can meet its objectives.

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Five Keys Questions in Human Resource Planning

How many employees do we needin terms of numbers?

What are we looking for in terms of skills, knowledge, experience, abilities etc.in terms of quality?

Where do we need the employeesthe location, the division, the

department?

When do we need the employeesimmediately, in the next three

months, six months etc.?

How long do we need themfor a limited period or for a long period?
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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Features
Forward looking In sync with organisational needs In tune with corporate plan

Proactive

Get qualified people at a right time

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Objectives
HR planning is required to meet the following objectives: (Reilly; Overman) Forecast personnel requirements Cope with changes Use existing manpower productively

Promote employees in a systematic manner

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Importance
Reservoir of talent

Prepare people for future

Expand or contract Cut costs

Succession planning

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

The Process of Human Resource Planning

Forecasting the Demand for Human Resources 1. External challenges i. Economic developments(Liberalization, banking sector, online trading ii. iii. 2. 3. 4. Political, legal, social and technical changes Competition (thin margin of profit; reduce workforce)

Organizational decisions (strategic plans, sales and production forecasts, new ventures) Workforce factors (retirement, termination, resignation, death) Forecasting techniques i. ii. Judgmental Methods Trend Analysis Mathematical Model Computer model
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Human resource

Management (3rd Edition)

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CH-5 Human Resource Planning

Preparing Manpower Inventory (Supply Forecasting) 1. Internal labour supply i. ii. iii. 2.Forecasting Techniques

Staffing table (age, sex, position, experience, qualification) Markov analysis on the basis of past probabilities..predict future) Skills inventory (knowledge, skills, abilities, experience, career

aspirations of every employee)

iv. Replacement chart (shows a profile of job holders department

wise and offers a snapshot of who will replace whom if there is a job

opening)
Cont.

3. External labour supply

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Copyright 2010, VSP Rao

Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Formulating HR Plans jobs Recruitment plan Redeployment plan(transferring or retaining existing employees for new

Redundancy plan(who is redundent when and where, plan for re training,

golden handshake, layoffs) Training plan

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Productivity plan (reasons for increase in productivity, job redesign)

Retention plan
Copyright 2010, VSP Rao

Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Responsibility for HRP

Assist and counsel operating managers to plan and set objectives.

Collect and summarize manpower data keeping long-run objectives and

broad organisational interests in mind.

Monitor and measure performance against the plan and keep top management informed about it.

Provide proper research base for effective manpower and organisational planning.
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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

Effective Human Resource Planning

1. 2. 3. Objectives Top management support Employee skills inventory

4.

Human Resource information system

5.

Coordination

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Human resource

Management (3rd Edition)

V S P Rao

Excel Books

CH-5 Human Resource Planning

How Companies should Deal with imbalances in labour Supply

When faced with a shortage

Recruit new full time employees Offer incentives for postponing retirement Rehire retired employees part time Attempt to reduce turnover Work Present staff overtime Subtract work to another firm Hire temporary hands Re-engineer to reduces needs Out source an entire function Use technology to improve productivity Re-allocate people from elsewhere in the organisation Re-allocate work tasks among current employees

When Faced with a surplus

Do not replace employees who leaves Offer incentives for early retirement Transfer or re-assign excess staff Use slack time for employees training or equipment maintenance Reduce work hours Lay off employees Freeze hiring

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Human resource

Management (3rd Edition)

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