HUMAN RESOURCE PLANNING • Right number of people with right skills at right place at right time to implement organizational strategies in order to achieve organizational objectives • In light of the organization’s objectives, corporate and business level strategies, HRP is the process of analyzing an organization’s human resource needs and developing plans, policies, and systems to satisfy those needs
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HUMAN RESOURCE PLANNINGlibvolume8.xyz/textile/btech/semester7/retailmanagement/... · 2015-01-16 · HRP Process • Interfacing with strategic planning and scanning the environment
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HUMAN RESOURCE PLANNING
• Right number of people with right skills at
right place at right time to implement
organizational strategies in order to
achieve organizational objectives
• In light of the organization’s objectives, corporate and business level strategies, HRP is the process of analyzing an organization’s human resource needs and developing plans, policies, and systems to satisfy those needs
HUMAN RESOURCE PLANNING
• Setting human resource
objectives and deciding how to
meet them
• Ensuring HR resource supply
meets human resource
demands
HRP Process
• Interfacing with strategic planning and
scanning the environment
• Taking an inventory of the company’s
current human resources
• Forecasting demand for human
resources
• Forecasting the supply of HR from within
the organization and in the external
labor market
HRP Process Cont.
• Comparing forecasts of demand
and supply
• Planning the actions needed to
deal with anticipated shortage or
overages
• Feeding back such information
into the strategic planning
process.
Example of the Basic Human
Resources Planning Model
Organization
al Objectives
Human Resource
Requirements
Human Resource
Programs Feasibility
Analysis
HRP Model
• Strategic Human Resource Planning
– Links 1 & 5: HR objectives are linked to
organizational objectives and planning
• Designed to insure consistency between organization's strategic planning process and HRP.
– So objectives of strategic plan are feasible
and
– HR programs are designed around what
organizational objectives and strategies
require in terms of human resource goals
Example of the Basic
Human Resources Planning
Model
Organization
al Objectives Human Resource Requirements
Human Resource Programs
Feasibility
Analysis
1 2 3
4
5
HRP Model Cont.
• Operational Human Resource
Planning
–Steps 2,3, & 4
• Ensure HRP programs are
coordinated and allows the
organization to meet its human
resource requirements.
Example of the Basic Human
Resource Planning Model
Open new
product line
Open new
factory and
distribution
system
Develop staffing for
new installation
•Production
workers
•Supervisors
•Technical staff
•Other managers
Recruiting and
training
programs
feasible
Transfers
infeasible
because of lack
of managers
with right skills
Recruit skilled
workers
Develop technical
training programs
Transfer managers
from other facilities
Develop new objectives
and plans Recruit managers
from outside
Too costly to hire
from outside
1 2 3
4
5
6
Link 1: Determine Demand
(labor requirements)
• How many people need to be working and in
what jobs to implement organizational strategies
and attain organizational objectives.
• Involves forecasting HR needs based on organizational objectives
• Involves consideration of alternative ways of organizing jobs (job design, organizational design or staffing jobs)
• Example - Peak production could be handled by temporary workers or assigning overtime. Machine breakdowns assigned to maintenance department or handled by machine operators
Link 2: Determine HR Supply (availability)
• Choose HRM programs (supply)
• Involves forecasting or predicting effect of various HR programs on employee flowing into, through and out various job classifications.
• First determine how well existing programs are doing then forecast what additional programs or combination of programs will do
• Need to know capabilities of various programs
and program combinations
Determine Feasibility Links 3 & 4
• Capable of being done – Requires knowledge of programs, how programs fit together and external environmental constraints (e.g., labor force, labor unions, technology created skill shortages) and internal environmental constraints (skill shortages within the organization, financial resources, managerial attitudes, culture)
• Do the benefits outweigh the costs – Difficulty in quantifying costs and benefits
Revise Organizational Objectives and Strategies Link 5
If no feasible HR program can be devised, the organization must revise strategic plans.
Shortcomings of the model - HRP in Practice
• Oversimplification of planning process -Planning does not normally proceeds till find first acceptable plan
• More than one set of HR goals to satisfy link 1 and more that one acceptable plan to satisfy link 2 so:
• Typically choose the best HR goal for the strategic plan and the best program to satisfy that HR goal
Shortcomings of the model - HRP in Practice
• Oversimplification of the benefit of planning is the specific plans that result
– Planning process has value in and of itself
• HRP in practice is usually less rational and may omit one or more of the steps
– May lack knowledge required for forecasting
– Incorrect assumptions about effectiveness of HR programs
– Does not engage in strategic planning
– Resistance to change present HR systems
HRP should be :
• Done to guide and coordinate all HR activities so they work together to support the overall strategy
• Responsive to internal and external environment
• Planning - done in advance
• Strategic - linked with higher level planning
Human Resource Forecasting
• Process of projecting the organization’s future HR needs (demand) and how it will meet those needs (supply) under a given set of assumptions about the organization’s policies and the environmental conditions in which it operates.
• Without forecasting cannot assess the disparity between supply and demand nor how effective an HR program is in reducing the disparity.
Forecasting as a Part of HRP
DEMAND
FORECASTING
SUPPLY
FORECASTING
Determine
organizational
objectives
Demand
forecast for
each objective
Aggregate
demand
forecast Does aggregate
supply meet
aggregate
demand?
Go to feasibility analysis steps
Choose human resource programs
External programs
• Recruiting
• External selection
•Executive
exchange
Internal programs
•Promotion
•Transfer
•Career planning
•Training
•Turnover control
Internal supply forecast External supply forecast
Aggregate supply forecast
No
Yes
Internal Supply Forecasting Information
• Organizational features (e.g., staffing capabilities)
• Productivity - rates of productivity, productivity changes
• Rates of promotion, demotion, transfer and turnover
External Supply Forecasting Information
• External labor market factors
(retirements, mobility, education,
unemployment)
• Controllable company factors on
external factors (entry-level
openings, recruiting,
compensation)
Demand Forecasting
Information
• Organizational and unit strategic
plans
• Size of organization
• Staff and Managerial Support
• Organizational design
Considerations in Establishing
a Forecasting System
• How sophisticated
• Appropriate time frame
• Subjective versus objective
forecasting methods
System Sophistication
• Organizational size – large organizations require more complex forecasting systems and likely to have the required skilled staff
• Organizational complexity – complex career paths and diverse skill requirements lead to more complex forecasting systems
• Organizational objectives – the greater the gap between current HR situation and desired HR situation the more sophisticated the system
• Organizational plans and strategies – the complex the plans are the more complex the forecasting system
Forecasting Time Frame
Depends on degree of environmental uncertainty
Factors creating uncertainty (shortening time frame) – many new competitors, changes in technology, changes in social, political and economic climate, unstable product demand