HUMAN RESOURCES IN THE STRATEGIC PLANNING PROCESS

The Process of Human Resource Planning

Organizations need to do human resource planning so they can meet business

objectives and gain a competitive advantage over competitors.

Human resource planning compares the present state of the organization with its goals
for the future.

Then identifies what changes it must make in its human resources to meet those goals.

Human Resources

– Are the people who make up the workforce of an organization, business sector or
economy.

Human Resource Planning

– Is a process that identifies current and future human resources needs for an
organization to achieve its goals.

Human Resource strategy

– Is a designation for long-term plan created to achieve objectives in the field of

human resource and human capital management and development in the
organization.

The strategic HR planning process

The strategic HR planning process has four steps:

• Assessing the current HR capacity

• Forecasting HR requirements
• Gap analysis
• Developing HR strategies to support organizational strategies

First step: Assessing current HR capacity

The first step in the strategic HR planning process is to assess the current HR capacity
of the organization.

The knowledge, skills and abilities of your current staff need to be identified. This can be
done by developing a skills inventory for each employee.

The skills inventory should go beyond the skills needed for the particular position. List
all skills each employee has demonstrated.

For example, recreational or volunteer activities may involve special skills that could be
relevant to the organization. Education levels and certificates or additional training
should also be included.

An employee's performance assessment form can be reviewed to determine if the

person is ready and willing to take on more responsibility and to look at the employee's
current development plans.
Second step: Forecasting HR requirements

The next step is to forecast HR needs for the future based on the strategic goals of the
organization.

HR Forecasting attempts to determine the supply and demand for various types of
human resources, and to predict areas within the organization where there will be labor
shortages or surpluses.

There are three major steps to forecasting:

1. Forecasting the demand for labor

2. Determining labor supply

3. Determining labor surpluses and shortages

1. Forecasting the demand for labor

- How many people need to be working and in what jobs to implement

organizational strategies and attain organizational objectives.
- Usually an organization forecasts demand for specific job categories or skill
areas.
- After identifying the relevant job categories or skills, the planner investigates the
likely demand for each.
- The planner must forecast whether the need for people with the necessary skills
and experience will increase or decrease.
- Constructing and applying statistical models that predict labor demand for the
next year, given relatively objective statistics from the previous year.

2. Determining labor supply Predicting Worker Flows and Availabilities

- Succession or Replacement Charts

- Who has been developed and is ready for promotion right now?
- Human Resource Information Systems (HRIS)
- An employee database that can be searched when vacancies occur.
- Transition Matrices (Markov Analysis)
- A chart that lists job categories held in one period and shows the proportion of
employees in each of those job categories in a future period.
- It answers two questions:
- “Where did people in each job category go?”
- “Where did people now in each job category come from?
- Personnel / Yield Ratios
- How much work will it take to recruit one new accountant?

3. Determining Labor Surplus or Shortage

- Based on the forecasts for labor demand and supply, the planner can compare
the figures to determine whether there will be a shortage or surplus of labor for
each job category.
- Determining expected shortages and surpluses allows the organization to plan
how to address these challenges.
- When forecasting demands for HR, you must also assess the challenges that
you will have in meeting your staffing need based on the external environment.

To determine external impacts, you may want to consider some of the following factors:
 - How does the current economy affect our work and our ability to attract new
employees?
- How do current technological or cultural shifts impact the way we work and the
skilled labor we require?
- How is our community changing or expected to change in the near future?

Third step: Gap analysis

The next step is to determine the gap between where your organization wants to be in
the future and where you are now.

The gap analysis includes identifying the number of staff and the skills and abilities
required in the future in comparison to the current situation.

You should also look at all your organization's HR management practices to identify
practices that could be improved or new practices needed to support the organization's
capacity to move forward.

Fourth step: Developing HR strategies to support organizational strategies

There are many HR strategies for meeting the labor surplus or shortage in the future.

Surplus

• Restructuring strategies
• Hiring freeze
• Layoffs
• Transfer
• Reduce work time
• Reduce part-time

Shortage

• New Hires
• Transfer
• Training/Retrain
• Overtime
• Part-time

Changing Nature of Human Resource Management

Human Resource (HR) management

– The design of formal systems in an organization to ensure the effective and

efficient use of human talent to accomplish the organizational goals.

Who is an HR Manager?

– In the course carrying out their duties, every operating manager is, in essence an
HR manager.

HR specialist design processes and systems that operating managers help implement.

As human resources have become viewed as more critical to organizational success,

many organizations have realized that it is the people in an organization that can
provide a competitive advantage.
It deals with the design of formal systems in an organization to ensure the effective and
efficient use of human talent to accomplish organizational goals. In an organization, the
management of human resources means that they must be recruited, compensated,
trained, and developed.

HR Activities:

• Strategic HR Management
• Equal Employment Opportunity
• Staffing
• HR Development
• Compensation and benefits
• Health, safety and security
• Employee and labor relation
• Cooperation of HR with Operating Managers

HR Unit:

• Develops legal, effective interviewing techniques

• Train managers in conducting selection interviews
• Conduct interview and testing
• Sends top three applicants to managers for the review
• Checks references
• Does final interviewing and hiring for certain job classification
• Managers
• Advise HR of Job opening
• Decide whether to do own final interviewing
• Receive interview training from HR unit
• Do final interview and hiring where appropriate
• Review reference information
• Provide feedback to HR unit on hiring/rejection decisions
• HR Management Challenges

Economic and Technology Changes

Shift in jobs for manufacturing and agriculture to service industries and

telecommunications.

Pressures of global competition causing firms to adapt lowering costs and increasing
productivity.

Growth of information technology (Internet).

Workforce Availability and Quality

– Inadequate supply or workers with needed skills for knowledge jobs.

In the last several years news reports have regularly described tight labor markets with
unemployment rates in some locales below 3%. Also, continuously there are reports by
industries and companies facing shortages of qualified, information systems
technicians, physical therapists, plumbers, air conditioning repair technicians, and many
others. Consequently, HR professionals have faced greater pressures to recruit and
train workers.

Growth in Contingent Workforce

– Increase in temporary workers, independent contractors, lease employees, and

part-timers.
In the past, temporary workers were used for vacation relief, maternity leave, or
workload peaks. Today “contingent workers” (temporary workers, independent
contractors, leased employees, and part timers) represent over 20% of the workforce.
Many employers operate with a core group of regular employees with critical skills and
then expand and contract the workforce through the use of contingent workers.

Administrative Role

– Clerical and administrative support operations (e.g., payroll and benefits work).

The administrative role of HR management is heavily oriented to processing and record

keeping. Maintaining employee files and HR-related databases, processing employee
benefits claims, answering questions about tuition and/or sick leave policies, and
compiling and submitting required state and federal government reports are all
examples of the administrative nature of HR management. These activities must be
performed efficiently and promptly.

Employee Advocate Role

– “Champion” for employee concerns

- Employee crisis management

- Responding to employee complaints

Operation Role

– Identification and implementation of HR programs and policies, hiring, training

and other activities that support the organization.

Operational activities are tactical in nature. Compliance with equal employment

opportunity and other laws must be ensured, employment applications must be
processed, current openings must be filled through interviews, supervisors must be
trained, safety problems must be resolved, and wages and salaries must be
administered.

Strategic Role for HR

• Focusing on developing HR programs that enhance organizational performance.

• Involving HR in strategic Planning at the onset.
• Participating in decision making on mergers, acquisitions and downsizing.
• Redesigning organizations and work processes.
• Accounting and documenting the financial results of HR activities.

Organizational human resources have grown as a strategic emphasis because effective

use of people in the organization can provide a competitive advantage, both
domestically and abroad. The strategic role of HR management emphasizes that the
people in an organization are valuable resources representing significant organizational
investments. For HR to play a strategic role it must focus on the longer-term
implications of HR issues.15 How changing workforce demographics and workforce
shortages will affect the organization, and what means will be used to address the
shortages over time, are illustrations of the strategic role. The importance of this role
has been the subject of extensive discussion recently in the field, and those discussions
have emphasized the need for HR management to become a greater strategic
contributor to the success of organizations.
 UNIVERSIDAD DE ZAMBOANGA

SCHOOL OF BUSINESS AND MANAGEMENT

Pre-Final PRESENTATION
IN

MANAGEMENT 3
(Production and Operation Management)

PRESENTED TO:

NURHANEE E. ALIAKBAR
Instructor

PRESENTED BY:

NILDA S. BACLAYAN
BSAT-3A
 Management – 3

Question and Answer

Identification:

1) Operation Role Identification and implementation of HR programs and policies,

hiring, training and other activities that support the organization.

2) Gap analysis the next step is to determine the gap between where your
organization wants to be in the future and where you are now.

3) Human Resource Planning Is a process that identifies current and future

human resources needs for an organization to achieve its goals.

4) Growth in Contingent Workforce Increase in temporary workers, independent

contractors, lease employees, and part-timers.

5) Administrative Role Clerical and administrative support operations (e.g., payroll

and benefits work).

6) Human Resource Management The design of formal systems in an

organization to ensure the effective and efficient use of human talent to
accomplish the organizational goals.

7) Human Resources Are the people who make up the workforce of an

organization, business sector or economy.

8) Workforce Availability and Quality Inadequate supply or workers with needed

skills for knowledge jobs.

9) Strategic Role for HR Focusing on developing HR programs that enhance

organizational performance.

10) Forecasting HR requirements to determine the supply and demand for various
types of human resources, and to predict areas within the organization where
there will be labor shortages or surpluses.
 Quiz

Management - 3

Name: ___________________ Date: __________

Identification:

____________________ 1). Identification and implementation of HR programs and

policies, hiring, training and other activities that support the organization.

____________________ 2). The next step is to determine the gap between where your
organization wants to be in the future and where you are now.

____________________ 3). Is a process that identifies current and future human

resources needs for an organization to achieve its goals.

____________________ 4). Increase in temporary workers, independent contractors,

lease employees, and part-timers.

____________________ 5). Clerical and administrative support operations (e.g., payroll

and benefits work).

____________________ 6). The design of formal systems in an organization to ensure

the effective and efficient use of human talent to accomplish the organizational goals.

____________________ 7). Are the people who make up the workforce of an

organization, business sector or economy.

____________________ 8). Inadequate supply or workers with needed skills for

knowledge jobs.

____________________ 9). Focusing on developing HR programs that enhance

organizational performance.

____________________ 10). To determine the supply and demand for various types of
human resources, and to predict areas within the organization where there will be labor
shortages or surpluses.