Human Resource Planning

   
5-2

DEFINE

It is process by which an organisation

should move from its current manpower
position to its desired manpower
position. Though planning management
strives to have the right number and right
kind of people at the right place at the
right time.

   
 Define Strategy: It is unified , comprehensive
and integrated plan that relates the strategic
advantages of the firm to the challenges of
the environment

   
 Objective

The basic purpose of HRP is to decide what

positions the organisation will have to fill and
how to fill them.
Objectives of human resource planning
Forecast personnel requirements
Cope with changes
Use existing manpower productively
Promote employees in a systematic way

   
 Objectives of Human Resource Planning

To recruit and retain the HR of required
quantity and quality.


To foresee the employee turnover and make
the arrangement for minimising turnover and
filling up of consequent vacancies.

   
 To meet the needs of the programmes of


expansion, diversification etc.

To assess the surplus or shortage of HR



and take measures accordingly

Estimate the cost of human resource



   
 Importance

Organisations use HRP to meet future challenges, cut

costs, and achieve greater effectiveness

Importance of human resource planning


Create a talent pool

Prepare people for future

Cope with organisational changes

Cut costs

Help succession planning

   
 The Process Of HRP

The HRP is a four step process: demand

forecasting, supply forecasting, estimating manpower
gaps and formulating HR plans. The demand for
human resources is influenced by several factors
Forecasting the demand for human
resources

External challenges
Economic developments
Political, legal, social, technological changes
Competition

Organisational decisions
 

Workforce factors  
 The Process Of HRP

The HRP is a four step process:

demand forecasting,
supply forecasting,
estimating manpower gaps and
formulating HR plans.
The demand for human resources is influenced by
several factors

   
 FACTORS Of HRP

External Challenges: Liberalisation, privatisation

and globalisation (LPG era) have created huge
demand for people in software, finance marketing,
and manufacturing fields.
Organisational Decisions: Decisions such as
expansion, diversification, and relocation leading to
demand for people possessing requisite skills
Workforce Factors: Such as retirement, resignation,
and termination etc creating manpower gaps.

   
 Forecasting Techniques

HR forecasts are an attempt to find out an

organisation's future demand for employees

Forecasting techniques

Expert forecasts


Trend analysis


Workforce analysis


Workload analysis


   
 Forecasting techniques

Expert Forecasts: These are based on the judgements of those who

possess good knowledge of future human resource needs
Trend Analysis: This is based on the assumption that the future is
an extrapolation from the past. Human resource needs, as such, can
be estimated by examining past trends.
An example of trend analysis
2001-02 Production of Units : 5,000
2002-03 No. of Workers : 100
Ratio5000/100 : 50
2003-04 Estimated Production : 8,000
No. of Workers required : 8000 1/500 0 = 160
5 0 0 0
If supervisors have a span of 20 workers, 8 supervisorsare also needed in
2003-04.
   
 Forecasting techniques

Workforce Analysis: All relevant factors in planning

manpower flows in a firm such as transfers, promotions,
new recruitments, retirement, resignation, etc are taken
into account while estimating HR needs

   
 Manpower flows in a
bank

TRANSFER
TRANSFERS IN OUT/PROMOTION OUT

RETIREMENT

VRS
RECRUITMENT IN

TERMINATION

RESIGNATION
PROMOTION IN

   
 Forecasting techniques

Workload analysis: Based on the planned output, a

firm tires to calculate the number of persons required
for various jobs.
An example of workload analysis

Planned output for the year 10,000 pieces

Standard hours per piece 3 hours
Planned hours required 30,000 hours
Productive hours per person per year 1,000 hours (estimated on annual
basis)
(allowing for absenteeism, turnover, idle time etc.)
No. of workers required 30
If span of control in the unit is 10 per officer, then 3 officers are also required.
   
5-11

Supply Forecasting

A) Internal labour supply: a manpower inventory in

terms of the size and quality of personnel
available (their age, sex, education, training,
experience, job performance, etc) is usually
prepared by HR departments.

   
5-12

Estimated internal labour supply for a

given firm
S o u r c e s o f I n f l o w s T h e F ir m P r o j e c t e d O u

 P r o m o t io n s

 T r a n s f e r s  Q u i t s
C u r r e n t S t a f f i n g
 P r o m o t io n s L e v e l  T e r m i n a t i o n
E m p lo y e e s I n E m p l o y e e s O u t
 N e w R e c r u i t s  R e t ir e m e n t

 R e c a ll s  D e a t h s

 L a y o f f s

C u r r e n t P r o je c t e d P r o je c t e d F i r m ’s in t e r n a l
s t a f f i n–g o u t f l o w s i n f l o w s + s u p p l y f o r t h i s
le v e l t h is y e a r t h is y e a r t i m e n e x t y e a r

   
5-15

Supply Forecasting

Skills inventory: It is a summary of the skills

and abilities of non managerial employees used
in forecasting supply.

   
 Skills inventory: an example

N a m Ae . K: . S e n D a t e p r i n1 t -e 4 d - 2 : 0 0 4
N u m b 4e 2r 9 : D e p a r t m 4e1n t :

K e y w o r d s W o r k e x p
W o r d D e s c r i p At i oc nt i v i t y F r o m T o
A c c o u n t i n g TS a u x p e r v i s i o n 1 9 9 c 8l e r k 2 0 0 0 A T B a Cx C o m p
a n d a n a ly s is
B o o k K e Le ep di n g g e r S u p e r v i sA i oc nc o u n 2 t 0aX 0nY 0t Z C o2. 0 0 2
A u d i t i n g C o m p u teAr n a l y s i 2s 0 0 2 2 0 0 3 C Bh i a e n f k A c c o u n t s T
r e c o r d s O

E d u c a t io n S p Me c e i a m l Qb eu ar sl i fh i c i pa t s i o n

D e g r e Me a jo r CY eo au r s e D a t e A I M A 1 .

M B A F i n a n c e D B F 1 9 9 8 I 1S 9 T 9 D 6
B . C o m A 1 c 9 c 9o 5 u n t sR i s k M a n a g e m e n t 1 9 9 9

C o m p u t e Lr a n g u a g e s P o s i t i o n L o c a t i o n
L i t e r a c y p r e f e r e n c ec h o i c e

 T a ll y F r e n c h A c c o u n t i n g K o lk a t a C h e s s
 B a n k in g D e lh i A uF d o i ot i nt b g a l l
S o f t w a r e B a n g a l o r e B o a t in g

E m p l o y e e s S i g n a t u r e _ _ _ _ _ _ _ _ _ _
D a t e _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
   
 Supply Forecasting

Replacement chart: It is a visual

representation of who will replace whom in
the event of a job opening.

   
5-18

Replacement chart

G e n e r a l M a n a g e r K e y
V . K . G a r g N a m e s g i v e n a r e r e p la
A / 2 c a n d i d a t e s
P A t o A . P r o m o t a b le n o w
G e n e r a l M a n a g e r B . N e e d in g d e v e l o p m
L . M a t h e w s C . N o t s u it a b l e t o p o s
B / 1 1 . S u p e r i o r p e r f o r m a
2 . A b o v e A v e r a g e p e
A s s is t a n t G e n e r a 3l . M A a cn c a e g e r
p t a b l e p e r f o r m
R . K . A r o r a 4 . P o o r p Ae /r 2f o r m a n c e
B . K . N e h r u B / 3

D iv i s i o n : D iv is io n : D iv is io n :
H R M a n a g e rA c c o u n t i n g & P la n n i n g M a n T ea gc he nr i c a l A d v
C . P . T h a k u r T a x a At i o/ 1 n M a n a g e Ar . N . G u p t a N . RA ./ 1 M u r t h y
A . T . R o y K C . /P 2 . R a o B / 1

No r t h e r n R e gC i oe n t r a l R eS g o i uo tn h e r n R e g i o n E M a a s n t ea r g n e Rr e g
M a n a g e r M a n a g e r A . S u b r a m a n y a M m a n Ba g/ 2 e r
L . C . S r i v a t s a v S . PA . / K2 u m a r B A . K/ 1 . M e n o n R . K B r / i 1s h n a
A . T h a p a r R . C P / 4a n d e y B / 3

   
 Formulating HR Plans

Once supply and demand for labour is known

adjustments can be made formulating requisite HR
plans
A variety of HR plans
 Recruitment plan
 Redeployment plan
 Redundancy plan
 Training plan
 Productivity plan
 Retention plan
   
 Limitations Of Human Resource
Planning

HR professionals are basically confronted with

three problems while preparing and
administering HR plans:
accuracy,
inadequate top management support,
lopsided focus on quantitative aspects.