MANPOWER PLANNING

Swati A Vispute, PhD

 CONTENTS

• Objectives of Manpower Planning

• Estimating Manpower requirements
• Recruitment & selection
• Succession Planning
• Career Planning
• Downsizing & Restructuring
 MANPOWER PLANNING

• Manpower Planning is essentially the process of getting the number of

qualified employees and seeking to place the right employees in the right
job at the right time, so that an organisation can meet its objectives.
CASE STUDY SITUATION
The president has called a meeting to get your feedback on Jack, a department manager. Jack is what some people call “from the old
school” of management. He is gruff, bossy, and often shows an “it’s my way or the highway” attitude. Jack is about five years from
retirement. Jack has a high turnover rate in his department. There have been several complaints on company surveys about him from
his department and from outside his department.
People have commented on the fact that Jack is “rude” during meetings and doesn’t let others contribute. There are times when he has
belittled people in meetings and in the hallway. He also talks about his staff “critically” or “negatively” to other managers.
But Jack also is a brilliantly talented person who adds a vast amount of needed knowledge and experience to the company. He is
extremely dedicated to the company and lets people know this by his arrival each day at 6:30 a.m. and his departure at 6:00 p.m. He
has been with the company for 32 years and he reports directly to the president. Jack has gone to the HR department and complained
that the people his supervisors hire are not a good fit for the company. The new employees don’t listen and they have a poor work
ethic. Jack feels that HR do a better job screening people.
• What suggestions do you have for the president on how to coach Jack and develop a personal improvement plan?
• What areas would you suggest be first on Jack’s improvement plan?
• What kind of timetable would you put in place?
• How about milestones and consequences?
• How should Jack be coached and by whom?
• Is it worth the effort, since he might be retiring soon?
• After introductions, the president will ask you for your “How to Coach Jack” plan.
• Each member of the team (individual) should contribute to the plan details.
 OBJECTIVES OF MANPOWER PLANNING

• Forecast personnel requirements

• Cope with change
• Use existing manpower productively
• Promote employees in a systematic manner
 THE RECRUITMENT AND SELECTION
PROCESS

1. Decide what positions to fill through personnel planning and forecasting.

2. Build a candidate pool by recruiting internal or external candidates.
3. Have candidates complete application forms and undergo initial screening
interviews.
4. Use selection tools to identify viable candidates.
5. Decide who to make an offer to, by having the supervisor and others
interview the candidates.
 Steps in Recruitment and Selection Process

The recruitment and selection process is a series of hurdles aimed at selecting the best candidate for the job.
IBM has been transitioning from supplying mostly computers to supplying software
and consulting services. Therefore, in terms of IBMs strategic workforce needs, in
three years, 22 percent of our workforce will have obsolete skills. Of the 22 percent,
85 percent have fundamental competencies that we can build on to get them ready
for skills we’ll need years from now. The remaining 15% will either self-select out of
IBM or be let go. As at IBM, workforce and succession planning should entail thinking
through the skills and competencies the firm needs to execute its overall strategy. At
IBM, for instance, human resource executives review with finance and other
executives the personnel ramifications of their company’s strategic plans. In other
words, What sorts of skills and competencies will we need to execute our strategic
plans?
Linking Employer’s Strategy to Plans
 HUMAN RESOURCE PLANNING PROCESS

Plan of
Action
Demand
• External Forecast • Required • Surplus (VRS, restricted
• Internal • Quantitative • Available hiring, downsizing)
• Judgmental • Gap Analysis • Demand = Supply (No
action)
• Shortage of Manpower
Environmental RAG (Recruit, training etc.)
Scan Analysis
 FORECASTING PERSONNEL NEEDS
FORECASTING TOOLS
Quantitative Methods Judgemental Method

Ratios Managerial Judgement

• Bottom-up approach
• Top-down approach
Benchmarking / Thumb Delphi Technique
Rule
Scatter Plot Zero based forecasting
Trend Analysis
Computerised forecasts/
Simulation
Work Study
 QUANTITATIVE METHODS

• Ratios – two variables bear a direct relationship with each other.

• E.g. If it takes 30 employees to sell 300 units, so ratio is 1:10
• If u need to sell 600 units at 1:10 ration, 60 sales people required
• Benchmarking / Thumb Rule
• Many years of experience gives rise to benchmark
• International benchmark for HR in automated environment is 1:100
• So if employee strength is 5000 then 50 HR employees will be needed.
 Scatter Plot - Determining the Relationship Between
Hospital Size and Number of Nurses
Hospital Size Number of
(Number Registered
of Beds) Nurses
200 240

300 260

400 470

500 500

600 620

700 660

800 820

900 860

Note: After fitting the line,

you can project how many
employees are needed,
given your projected volume.
 QUANTITATIVE METHODS

• Trend Analysis
• Collecting information and spot a pattern or trend in information
• If every year number of employees increases by 5%, then next year also you hire 5%
more employees than previous year.
• Computerized Forecasts / Simulation
• Software that estimates future staffing needs by:
• Projecting sales, volume of production, and
personnel required to maintain different volumes of
output.
• Forecasting staffing levels for direct labor, indirect
staff, etc..
• Creating metrics for direct labor hours and three
sales projection scenarios—minimum, maximum,
and probable.
 QUANTITATIVE METHODS

• Work study technique

• Apply work measurement to calculate how long operations should take
and the number of people required for the same.
• Time and motion study by Frederick Taylor and Frank and Lillian
Gilbreth
 JUDGEMENTAL METHODS

• Managerial Judgement – seeks opinions of manager, functional,

departmental heads, subject matter experts etc.
• Bottom-up approach
• Top-down approach
• Delphi Technique
• Experts take turns at presenting their forecast and assumptions to the
others, who then make revisions in their own forecasts.
• Zero based budgeting
• Managers build a budget from the ground up, building case for their
manpower requirements as if no baseline existed.
 DRAWBACKS TO TRADITIONAL FOREC ASTING
TECHNIQUES

• They focus on projections and historical relationships.

• They do not consider the impact of strategic initiatives on future staffing levels.
• They support compensation plans that reward managers for managing ever-larger staffs.
• They “bake in” the idea that staff increases are inevitable.
• They validate and institutionalize present planning processes and the usual ways of
doing things.
• Best Buy used talent analytics to determine that a 0.1% increase in
employee engagement led to a more than $100,000 rise in a Best Buy
store annual operating income.
• By monitoring employee satisfaction levels, Cisco was able to improve its
employee retention rate from 65% to 85%, saving the company nearly
$50 million in recruitment, selection, and training costs.
• Dow Chemical uses a computerized model that predicts future required
headcount for each business unit based on predictions for things like
industry trends.
 SUPPLY FORECAST

• Estimating likely supply of both inside and outside organization

• determining which current employees might be qualified for the projected
openings
• Methods (Internal Supply):
• Markov Analysis
• Replacement Charts
• Skills Inventories
 FOREC ASTING THE SUPPLY OF INSIDE C ANDIDATES

• Markov Analysis
• Helps to predict internal employee movement from one year to another by identifying percentages of
employees who remain in their jobs, get promoted or demoted, transfer, and exit out of the organization.
2019 Programme Assistant Shift Team CSRs Exit
2018 Manager Manager Supervisor Leader
Programme Manager 90% 10%
(n = 12) 11 1
Assistant Manager 11% 83% 6%
(n = 36) 4 30 2
Shift Supervisor 11% 66% 8% 15%
(n = 96) 11 63 8 14
Team Leader 10% 72% 2% 16%
(n = 288) 23 207 6 46
CSRs 6% 74% 20%
(n = 1440) 86 1066 288
Forecasted Supply 15 41 92 301 1072 351
 REPLACEMENT CHART

• Replacement chart
identifies possible
replacement for
positions which may
be rendered vacant
or open
 SKILL INVENTORIES

• Skill inventory is a compilation of the skills, education and experiences of current

employees
• Obtained from HRIS
• Helps in recruiting, training, and succession planning
• Example
 EXTERNAL LABOUR SUPPLY

Depends on :
• Economic conditions
• Unemployment rates
• College and high school graduation rates in the relevant labor market
• Net migration in or out of the area
• Relative skill levels of potential candidates in the labor market
• Competition for labor in the labor market
• Changes in the skill requirements of the organization’s potential job openings
 ACTIONS AFTER DEMAND AND SUPPLY
FORECASTING

• Recruitment
• Succession Planning
• Career Planning
• Downsizing / Restructuring
 SUCCESSION PLANNING

• Succession planning is a systematic approach to:

• Building a leadership pipeline/ talent pool to ensure leadership
opportunity
• Develop potential successions in ways that best fit their strengths
• Identifying the best candidates for categories of positions
• Concentrating resources on the talent development process.
• Succession Vs. Replacement Planning
 CAREER PLANNING

• Career planning is a process by which one selects career goals and

the path to these goals.
• Career development is those personal improvements one
undertakes to achieve a personal career plan.
 NEED OF CAREER PLANNING

• To attract or retain competent employee

• To provide suitable promotional opportunities
• To enable employees to take future challenges
COMPONENTS OF CAREER PLANNING
 CAREER ANCHORS

• Career Anchors – include talents, motives, values and

attitudes which give stability and direction to a person’s
career – it is the ‘motivator’ or ‘driver’ of that person.
• Know your career anchors

Edgar Schein
 DOWNSIZING / RESTRUCTURING

• Downsizing is the action of permanently reducing the number of employees

and/or divisions and department in the company in order to increase profit
• Restructuring is the act of changing the whole organizational structure of the
whole company.
 QUESTIONS

• What is manpower planning? Explain manpower planning process in detail.

• Explain objectives / need of human resource planning in any organization.
• What the quantitative tools used for demand forecasting of personnel requirements? Explain briefly.
• Briefly explain judgemental methods of personnel demand forecasting.
• Write a note on
• Markov Analysis
• Replacement charts
• Skills Inventory
• What are the actions taken by organization after manpower planning process? Explain.
• Write a note on Career anchors.
• Differentiate between Downsizing and Restructuring.