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Business Factors That Underpin Human Resources Planning in An Organization
Business Factors That Underpin Human Resources Planning in An Organization
Human resource planning has traditionally been used by organizations to ensure that the right
person is in the right job at the right time. Under past conditions of relative environmental
certainty and stability, human resource planning focused on the short term and was dictated
largely by line management concerns. Increasing environmental instability, demographic shifts,
changes in technology, and heightened international competition are changing the need for and
the nature of human resource planning in leading organizations. In order to adequately address
human resource related concerns, one must develop long-term as well as short term solutions
(Michael McConnell, 2004).
Human resource planning is the process of anticipating and carrying out the movement of
people into, within, and out of the organization. Human resources planning is done to achieve
the optimum use of human resources and to have the correct number and types of employees
needed to meet organizational goals. Human resource planning is the process of systematically
reviewing HR requirements in an organization to ensure that the required numbers of employees
with the required skills are available when and where they are needed (Michael McConnell,
2004).
Human resource planning includes four factors such as a) how many employees do we needed b)
which skills, knowledge and abilities are needed c) where does we need the employees and d)
when do we need the employees and how long do we need them. Accordingly, human resource
planning can be defined as the task of assessing and anticipating the skill, knowledge and labor
time requirements of the organization, and initiating action to fulfill those requirements. Thus, if
the organization as a whole or one of its subsystems is not performing to the benchmark, it may
need to plan redeploys its existing labour force. On the other hand, if it is growing or
diversifying, it might need to find and tap into a source of suitably skilled labour.
In case Yash Limited, the owner-manager has very aggressive plans for the next five years and
the business is expected to grow 100% in case of taxi business, 200% in cash of tyre fitting
business and 300% in case of wheel alignment business. Accordingly, in line with the business
strategy and forecast placing right people in right place at the right time is very critical. In doing
so figure out the man power requirement in next one year on a shot term basis, figure out the
projected customer base based on the historical data and market feed back, figure out the
expenses, figure out the best staffing structure for the business needs and be realistic and not be
overambitious keeping in mind that the company is only one year old and relatively new.
Initiate implementing a system for taxi drivers controls since the biggest staff strength is going to
be taxi drivers. Prior to starting the duty on every shift the drivers to be log-in to the system
which needs to be online connected to office and will have an update that how many of them are
in duty at a given point in time. As the organization is growing leveraging on IT would be a
critical factor. From the cost control point of view keep a track on which drivers are making
more accidents/other issues and find out the exact reason and arrange for the proper training not
to recur the incident.
Tyre fitting business and wheel alignment business can be looked in to from the business volume
point of view and the staff strength need not to be doubled at this point and instead can be
worked on shift basis for the first three months and view and revise the strategy accordingly. It is
important in this area to eliminate the duplication of work to maximum utilize the man power
with limited cost. Once the long term strategy for the three year is finalized the same split down
further in to yearly plans and implementation process for the plan on yearly basis can be done.
The company being in the initial growth path with aggressive growth plans it is pertinent to have
the cost control in all possible areas and the jobs related to logistics etc can be outsourced to
reduce the costs and increase the profitability. At the end of the day having right people at the
right place is most critical and need to be reviewed on a regular basis.
In case of Yash, with the projected growth in all the three line of business, need to find out what
kind of people we want during the first year. The maximum man power requirement would be in
taxi business. However, we need not double the existing strength of drivers from 14 to 28 with
immediate affect and instead can see the possibility of increasing the efficiency level by
increasing the staff by 50% in the initial stage and see the impact. Also can be done on shift basis
and can be implement some encouraging overtime plans to promote drivers to work some
overtime as well than hiring new employees on a full time basis with doubling the strength in
one go.
In line with the plan in addition to hiring new taxi drivers, we should look at the areas like
mechanics, fitters, receptionist, taxi controller, accountant, cashiers, computer operator, logistics
executive etc. It is pertinent to note that it is advisable not to hire all the required field specialists
immediately and non critical areas like cashier, receptionist etc were we don’t have to go for a
specialist like mechanics, fitters etc can go for a two-in-one plan in the initial stage. However, on
a later stage based on the improved business performance the staff strength can be slowly
segregated as volume increases. Look at the possibilities of outsourcing as well in the initial
stage for the jobs like logistics etc.
During the first year the staff strength of remaining two lines of businesses (except tax drivers)
can increase only 25% and can arrange with a shift plan and can hire some part time workers if
required at a cheaper price. Review the business performance on a quarterly basis and increase
the staff strength of other two line of business slowly and steadily. It is important that employees
being hired on a permanent basis are experienced and go on board immediately to take maximum
advantage in line with the aggressive business growth plans.
However, in the other two line of business it is pertinent that either you hire experienced worker
at a higher cost to get them on board immediately or ensure necessary training is provided to
them till they get on board and fully aware about the job for smooth operations and less
complaints. Being relatively new entity instead of setting up a dedicated training centre with
advanced technology it is advisable to conduct basic trainings internally and for the advanced
training, like tyre alignment and fittings etc. to be conducted externally to further sharpen the
skills of the workers and maximize the productivity.
Accordingly, the man power requirement for the first year can be reviewed on a quarterly basis
and upon completion of first year the full year review to be conducted and based on the business
performance and requirement necessary amendment can be done for the next two years as a long
term plan.
The overall purpose of strategic HR planning is to ensure adequate human resources to meet the
strategic goals and operational plans of your organization - the right people with the right skills
at the right time. Keep up with social, economic, legislative and technological trends that impact
on human resources in your area and in the sector. Remain flexible so that the organization can
manage change if the future is different than anticipated.
In line with the aggressive growth plan of the company it is pertinent that HR plan is also
contributed in the performance of the company with the same pace to be in line and to meet
common objective. After reviewing the requirement for the next three years make the plan for
recruitment, compensation and retention plan of employees. In case of taxi drivers make
necessary assessment and look at the experience on hand prior to hiring and decide the
compensation accordingly. The pay scale can be divided in to three based on the experience and
based on the work history in case of taxi drivers. The training required in their case will be very
limited however cannot be eliminated and can be conducted internally through the most
experienced drivers.
However, in case of tyre fitting and wheel alignment business it is important to hire experienced
workers to have a trouble free operation. Since huge investment was made in case of wheel
alignment it is important to ensure that the workers operating is well experienced to make use of
the machine at maximum to get the best possible output. In case of new hiring in wheel
alignment business, external training can be conducted, though expensive can be beneficial on a
long term basis.
Upon completion of one year few well experienced fitters can be chosen and send for a full
fledged training for one-two months to gain knowledge in mechanical side, and fresh fitters can
be hired during this period to replace them to ensure that the operation is not affected. Upon their
return from training they can directly deployed to a small garage opened by the owner manager
to do the maintenance of taxis. Hence external dependence on maintenance can be avoided and
can cater internally to reduce the cost.
Find out the route cause of 20% resignation in each year from the taxi drivers. Ensure to conduct
the exit interview with each outgoing employees to figure out the exact reason for leaving the
organization. Find out which level of drivers are leaving, are they experienced or newly joined or
over aged etc. If the pattern continued make the newly joined drivers locked for first two years
through a bond signed with the company to ensure that they continue at least the first two years.
Through a market survey ensure that the compensation is in line with the market and the working
hours are reasonable and compensated appropriately if they work overtime. The other issues like
work-life balance, work culture, attitude of boss (taxi controller) towards drivers etc need to be
reviewed in details to find our the route cause of 20% resignation of every year and see the
possibility of eliminating this to a nil level or to reduce to an acceptable level of 5-10% from
next year onwards.
Performance objectives to be set for each division and should be applicable for all employees at
all level and HR should have a close watch on this. In view of the highly ambitioned growth plan
it is pertinent to note that the performance of entire staff is formally reviewed on a quarterly
basis and related issues/deficiencies are addressed to owner manager for necessary amendments
and improvement to achieve the common goal. To improve performance the yearly performance
bonus reward plans can be formally announced to ensure that the employees are giving their best
to get the maximum out put to achieve the target results on an overall basis.
Having a HR policy in place and implemented successfully ensure consistency in dealing various
issues in the company internally and externally. It gives fairness in dealing employee related
issues at all levels no matter what position he or she is in to. It helps to build a trustworthy
relationship between the employee and the employer as if the employee is treated well it will
definitely reflect in his/her performance resulting building a rapport with the employer. Having a
policy in place clearly indicate the benefits of employees at all levels in addition to monthly
remunerations like, at what level one can get transportation allowance and at which level one can
get a car provided by the company etc leading less disputes between employees and
management.
It is pertinent to have an HR policy in place as it clearly indicates what is acceptable and non
acceptable behavior in an organization. There will be an vagueness in all the areas directly or
indirectly related to HR in an organization if the HR policy and procedure is not in place and
implemented well hence it is one of most critical factor in an organization to have the same in
place and implemented appropriately.
It is pertinent that HR is fully aware about the regulatory norms and requirements on federal as
well as on state level and ensure that the same is included in HR policies. Minimum wages,
number of working hours, leave policy, overtime payments if any etc stated in the HR policy
should be in line with the requirement of local regulatory and should not be conflicting.
Necessary amendments in line with the amendments in regulatory requirements need to be done
on an ongoing basis to avoid any possible conflict between the employee and employer.
Conclusion:
Developing a successful Human Resources Development plan for an organization is one of the
critical factors in any organization and to implement a well written HR policy and guidelines is
necessary to achieve the common goal in an organization. The HR function is a high-value-
added part of the organization and plays a key role in developing and implementing corporate
strategy mainly due to growing importance of human capital in organizational success. The HR
function needs to be more effective as a strategic partner in the organization rather than a purely
administrative function. Such an HR function will drive and deliver change rather than just react
to it. In order to achieve this highly desired prize, the HR function must develop its ability to
measure how HR decisions affect the organization and how the decisions taken by the
organization affect human capital.