Lecture 5

Strategic resourcing and

Workforce planning
Part 1 – Strategic
resourcing
Slide 3

1.1. The objective of strategic

resourcing

• Strategic resourcing aims to ensure that

the organization has the people it needs to
achieve its business goals
Slide 4

1.2. The strategic HRM approach to

resourcing

The integration of business and resourcing strategies is based on an

understanding of the direction in which the organization is going and
the determination of:
v the numbers of people required to meet business needs;
v the skills and behavior required;
v the impact of organizational restructuring;
v plans for changing the culture of the organization
Slide 5

1.3. The components of strategic employee

resourcing

Developing the
organization’s
Workforce employee value Resourcing
Retention plans Flexibility plan
planning proposition and plans
its employer
brand
Part 2 – Workforce
Planning
International
Slide 7 HRM © Bex Hewett 2014

HR planning Recruitment Selection

•How do •How do •How do

we know we get we choose
what them the best
employee interested person for
resources in us and the job?
we need? the job?
International
Slide 8 HRM © Bex Hewett 2014

2.1. Impact of poor resourcing

• High levels of turnover

• High recruitment costs
• Poor interpersonal relations
• Poor individual performance ->
– Poor organisational performance
– Negative impact on customer service or
product quality
• Negative impact on individual wellbeing
International
Slide 9 HRM © Bex Hewett 2014

2.2. Why HR planning is

important

• Clear links between organisation and HR plans =

better competitive advantage
• Better control over staffing costs and ensuring
appropriate numbers employed to meet current and
future needs
• Enables better judgements to be made about the
skills and attitude mix in the organisation
• To maintain an appropriate profile of staff (e.g.
diversity)
HR planning
International
Slide 10 HRM © Bex Hewett 2014

2.3. Aspects of HR
planning

• Identifying which jobs are needed to

achieve organisational aims (right jobs at
the right time)

• Forecasting demand and supply:

– future HR needs
– internal supply
– external supply
HR planning
Slide 11

2.4. Assessing
demand
In order to have adequate future HR needs forecast, following points should be
taken into account:
1. Organization, behaviour and culture
HR implications checklist
- New tasks?
- For whom?
- What competencies needed?
- Relative importance of team/individual behaviour
- Deleted tasks?
- How will managers need to manage?
Slide 12

2.4. Assessing
demand

In order to have adequate future HR needs forecast, following points should be

taken into account:
1. Organization, behaviour and culture
Strategic brainstorming exercise: managers write a corporate goal in the
centre and brainstorm changes that need to take place in each of the four
areas, one area at a time

Organization

Culture Corporate goal Formal and

informal system

People
Slide 13

2.4. Assessing
demand

In order to have adequate future HR needs forecast, following points should be

taken into account:
2. Employee numbers and skills (demand forecasting)
ü It’s the traditional area of forecasting employee number demand based on
the organization’s strategic objectives.
ü Both objective and subjective approached can be employed
International
Slide 14 HRM © Bex Hewett 2014

2.4. Assessing
demand

• Objective methods
– Using information about past labour requirements to plan
for the future and
– Taking into account changing requirements influenced by
organisational goals, technology, growth/decline etc.
• Subjective methods
– ‘Top-down’ – senior management make judgement based
on the organisational direction/strategy
– ‘Bottom up’ – dept. managers make bids for resources
based on their experiences on the ‘front line’
International
Slide 15 HRM © Bex Hewett 2014

2.5. Assessing
supply

• Internal
– High labour turnover may be a problem for supply (HR need to ask who
is leaving and why – push and pull factors)
– Are the right skills and attributes available internally? (linked to learning
& development strategy)

• External
– When unemployment is high, the potential pool of candidates is bigger.
– But is there a large enough pool of candidates with the right skills and
attributes?
– Globalisation provides a potentially larger pool but immigration laws may
restrict movement for certain jobs
Slide 16

2.5. Assessing
Internal supply

Analysing the current situation and projecting forward

1. Organization, behaviour and culture
- Employee engagement
- Motivation of employees
- Job satisfaction
- Organizational culture
- The way that people are managed
- Attitude to minority groups and equality of opportunity
- Commitment to organization and reasons for this
- ….
Slide 17

2.5. Assessing
Internal supply

Analysing the current situation and projecting forward

2. Current and projected employee numbers and skills (employee supply)
Current employee supply can be analysed in both individual and overall statistical
terms. Factors need to be considered such as:
- Number of employees classified by function, department, occupation, job title,
competencies, skills, qualifications, training, age, length of service,
performance assessment results
- How the internal supply of employees will change and primarily how many will
leave
- Current level of employee turnover rate with segmented groups.
- Behavioural aspects: why people leave
18

2.5. The PESTEL framework for external

analysis (1)

The PESTEL framework categorises

environmental influences into six main types:
political, economic,
social, technological,
environmental legal

Thus PESTEL provides a comprehensive list

of influences on the possible success or
failure of particular strategies.
19

The PESTEL
framework (2)
• Political Factors: For example, Government
policies, taxation changes, foreign trade
regulations, political risk in foreign markets,
changes in trade blocks (EU).
• Economic Factors: For example, business
cycles, interest rates, personal disposable
income, exchange rates, unemployment rates,
GDP trends.
• Socio-cultural Factors: For example,
population changes, income distribution,
lifestyle changes, consumerism, changes in
culture and fashion.
20

The PESTEL
framework (3)

• Technological Factors: For example,

new discoveries and technology
developments, ICT innovations, rates of
obsolescence, increased spending on
R&D.
• Environmental (‘Green’) Factors: For
example, environmental protection
regulations, energy consumption, global
warming, waste disposal and re-cycling.
 2.5. Assessing External Labor Market

• External supply pool from which employers attract

employees
• Components of labor market
– Labor force population: All individuals who are
available for selection if all possible recruitment
strategies are used
– Applicant population: Subset of the labor force
population that is available for selection using a
particular recruiting approach
 2.5. Labor Market
Components
– Applicant pool: All persons who are actually evaluated
for selection
• Applicant tracking system - Makes the recruiting process more
effective
– Individuals selected for a job - When the candidates
reject the offer:
• HR staff members must move back up the funnel to the
applicant pool for other candidates
• HR staff, in extreme cases, may need to reopen the recruiting
process
 2.5. Unemployment Rates and Labor
Markets

• Unemployment rates vary with business

cycles
– Strict hiring adopted by companies due to
recessionary conditions
• Decreased customer spending
• Increased business competition
• Decreased need for new employees due to
developments in technology
 2.5. Different Labor Markets and
Recruiting
Industry and Occupational Labor Markets
These jobs represent the health care, retail, and education
industries

Educational and Technical Labor Markets

Considering the educational and technical qualifications that
define the people being recruited

Labor Markets

Geographic Labor Markets

Markets can be local, area or regional, national, or
international

Global Labor Markets

Firms expand by exporting work to overseas labor markets when
doing so is advantageous
 2.6. Recruiting Presence and
Image

• Employment brand: Image of the organization

that is held by both employees and outsiders
– Company brand can help generate more recruits
through applicant self-selection
 2.7. Organization-Based
versus Outsourced Recruiting

• Recruitment process outsourcing (RPO)

–Improves the number and quality of recruiting
candidates
–Reduces recruiting costs
• Professional Employer Organizations (PEO)
and employee leasing
–Employer signs an agreement with the PEO
 2.7. Organization-Based
versus Outsourced Recruiting

– Staff is hired by the leasing firm and leased back to

the company for a fee
– Leasing firm:
• Writes the paychecks
• Pays taxes
• Prepares and implements HR policies
• Keeps all the required records for the employer
 2.8. Regular versus Flexible
Staffing

• Employers are hesitant to hire full-time employees due to:

– Increased cost
– Economic conditions
– Excessive competition
– Government considerations
 2.8. Regular versus Flexible Staffing

• Temporary workers - Employers can hire their own

staff members or make use of agencies on a rate-
per-day/week basis
– Purpose of hiring temporary workers
• Match the firm’s needs with the right workers
• Avoid costs associated with benefits
• Enhance staffing flexibility
 2.8. Regular versus Flexible
Staffing

• Independent contractors - Workers who perform

specific services on a contract basis
– Advantageous for the employer as they do not have to pay
benefits
– Done by individuals who are:
• Highly skilled
• Highly experienced
• Not affected by familial responsibilities
 Staff on permanent contract. ‘Functional
HR planning
flexibility’ = applying skills across a wide
range of tasks. Both:
- ‘Horizontal flex.’ = tasks outside of
The flexible firm Self-employment
immediate job
1: Secondary
- ‘Vertical flex.’ = taking on more senior or
workers, internal, junior jobs
numerical and
functional flex.
Core group:
Primary workers Sub-
Agency
Internal labour contractin
workers
market g
Functional flexibility

2: Secondary Two sets of secondary workers:

workers, external, 1. Semi-permanent, numerically flex. so
numerical flex. contracts can be terminated easily.
Periphery workers, e.g. self-employed, Also functionally flex.
or employed by another organisation. 2. Little employment security (so
Out-sourcing
Highly numerically flex. numerical flex.) Employed to do
specific job (no functional flex.)
Atkinson (1984) – see Marchington and Wilkinson, 2012