2.1.

Functions and Evolutions of

Human Resource Planning
 Workforce/human resource planning
 Process of anticipating current and future demand for workers in both the
short and long term
 Lessens hiring mistakes at the cost of time and money
 A workforce plan includes
 Careful consideration of current abilities and what will be needed in the
future (short-term or long-term)
 Identifying gaps and considering ways of addressing these
 Noting any training needs
 Developing training, recruitment and other personnel policies (e.g.
appraisals, employee welfare)
 Considers labour demand of an organization, which depends on:
 Historical data: average length of service, labor turnover rate, etc.
 Workload, specializations and flexibility of workforce
 e.g. flexible workforce can deal with sudden shortage of staff
 Capital Intensity (i.e. use of machinery)
 Work study (time and motion study or efficiency studies)
 Best number of people to complete a job efficiently
 Derived demand (from forecast output)
 Demand for labor depends on demand for product
 Natural wastage (aging/retirement)

 Staff/labor turnover
 Percentage of workforce that leaves the company in a time period
 (Number of leavers / Total number of staff) x 100
 Low turnover suggests good workforce planning and recruitment
 High turnover suggests incompetent employees and poor job satisfaction
 Reason why people leave their jobs
 CLAMPS (M.J. Yates)
 Challenge, Location, Advancement, Money, Pride, (Job) Security
 Poor morale, which is seen in:
 Militant workforce
 Frequent union representation to management
 Low suggestion rates
 Widespread rumors
 Factors affecting workforce plan
 Supply of labor
 Demographic changes
 Net birth rate
 Net migration rate
 Life expectancy and retirement age
 Workforce flexibility, skills, and education
 Women in workforce
 Mobility of labor (geographic and occupational)
  Flexibility of  internal workforce
 Cost of living
 Cost and availability of transportation
 Rate of unemployment
 Government
 Finances
 Structure of business
 Effectiveness of communication
 Morale of workforce
 Leadership style of managers
 Need for change/reaction to change
 Recruitment process
 Job analysis
 Skill and training required for the job
 Qualifications and personal qualities needed
 Rewards needed to recruit and retain the job holder
 Job description
 Outlines the details of the job (i.e. duties and responsibilities)
 Element of flexibility – not incredibly specific
 “Any other reasonable job assigned by employer”
 Person specification
 Profiles ideal candidate
 e.g. type of engineer, experience, skills
 Job advertisement
 Internal (w/in company)
 Advantages
 Cost effective
 Less time needed to acclimate to company culture
 Less risk
 Motivational
  Disadvantages
 Fewer applicants
 Time consuming
 No new ideas
 Internal politics
 External (outside the company)
 Advantages
 New blood (wide range of experiences)
 Larger pool of applicants
 Disadvantages
 Even more time consuming
 Expensive
 Uncertainty
 Need for TRAPS – truthful, relevant, accurate, positive, short
 Application process (resume, cover letter, application form)
 Selection process
 Screen applications and shortlist suitable candidates
 Interview the shortlisted candidates
 Perform testing (if applicable)
 Check each shortlisted candidate’s references
  Offer job to best candidate
 Sign the contract of employment
 Carry out induction of new recruit
 Monitor (paper trail)

 Training
 Process of providing opportunities for workers to acquire skills and
knowledge
 Training is the improvement of task-specific skills
 Development involves enhancing personal skills that improve workforce
flexibility
 Benefits
 Improve efficiency and effectivity
 Less wastage
 Higher morale
 Adapt to change easily
 Flexible workforce
 Drawbacks
 Cost
 Employees may leave since they are qualified for better jobs
 Types of training
 Induction
 Introduction to company policies, general info
 May involve meeting other personnel, touring the premises, etc.
 Advantages
 Establishes expectations
 Understand company culture
 Morale booster
 Disadvantages
 Time consuming
 Personnel have to be freed to work on the induction
 Info overload
 On the job
 Learn from coworkers by experience
 May involve being mentored by or shadowing senior managers
 Advantages
 Relatively cheap
 Relevant job-specific skills are learned
 Fewer disruptions to work
 Establish team relationships
 Disadvantages
 Possibility of learning bad working habits
 Trainers may lack the best training skills
 Trainers may not be able to work properly
 Off the job
 Learn from specialists from third party (e.g. university, speakers)
 Advantages
 Expert expertise
 Wide range of training
 No distractions
  Networking
 Disadvantages
 Expensive
 Loss of output
 Skills may be irrelevant
 Cognitive
 Theoretical training in the hopes of improving overall intelligence
 Advantages
 Improves brain function (memory, reasoning, etc.)
 Knowledge may apply to a wide variety of situations
 Disadvantages
 Costly
 May not be immediately practical/applicable
 Behavioral
 Practical training in order to improve employee attitudes/behaviors
 Advantages
 May make for more competent and assertive employees
 Improves customer and intra-company relations
 Disadvantages
 Costly
 Difficult to track progress
 Appraisals
 Annual formal assessment of performance judged against pre-set criteria
 Reasons
 Assess performance in line with job description and targets
 Identify hindrances
 Identify training needed
 Reflect on performance (areas for improvement)
 Praise good performance
 Set new goals/targets
 May be costly and time consuming (thus isn’t done often), subjective,
offensive, and biased (especially when appraising someone higher up)
 Appraisal Methods
 Essay
 Written appraisal on employee’s strengths and weaknesses
 Flexible and more applicable when employees are put in different
situations
 Open-ended, subjective and takes a lot of time to train appraisers,
and to appraise each employee
 Rating system
 Highly structured scale of employee performance
 Faster to carry out, structured, equal treatment
 Some traits assessed may not be relevant, perceived meaning of
scale descriptors may not be universal
 Peer
 Same level employees on the business hierarchy appraises you
 Appraiser and appraisee are familiar with requirements for job
 Might be reluctant to criticize peers
 Upwards
 Employee appraises seniors
  Subjective, appraiser afraid of appraisees
 MBO (Management by Objectives)
 Base all appraisal on how well employee has met his own objectives
as determined by employer and appraiser
 Objectives must be realistic
 Formative
 Appraisal during a specific job process
 Used to get feedback to guide improvement
 Summative
 Appraisal after a specific job process
 Compares the performance of an employee to a benchmark
 360 degree
 Appraisal from many different sources (managers, peers,
subordinates, customers, etc.)
 Comprehensive – many perspectives
 Subjective, influenced by group norms, time consuming
 Self-Appraisal
 Need for employees to set targets for improvement
 Steps
 Look at staff records and reports
 Appraisal meeting
 Appraiser writes a report
 Appraiser and the appraisee sign the final report
 Countersignature of a senior manager
 Dismissals and redundancies
 If employee performance is below par:
 Issue advisory letter
 Counselling – strategies for improvement
 Dialogue concerning consequences
 Dismissal and Redundancies
 Monitor (paper trail)
 Dismissal (by the business)
 Must have valid reason which is included in the contract
 Otherwise, unfair dismissal – company may be sued
 Valid reasons include:
 Employee incompetence or misconduct
 Breach of legal requirements/contract
 Redundancy
 Occurs when there is a change in company structure, downsizing, etc.
 Company cannot afford to pay employee or job stops existing
 Voluntary – employee volunteers to be made redundant in exchange
for a redundancy package (compensation)
 Involuntary – may be done through LIFO or retention by merit
 Changing employment patterns and practices
 Factors
 Employment sector (primary, secondary, tertiary)
 Aging population
 Labor supply
 Flexible work structures
 Teleworking/home working
  Portfolio/Project based/Contractual working
 Part time employment
 Flexitime
 Advantages
 Increased flexibility for both
 Work from afar
 Flexible and extended work hours
 Company needs only to train core employees
 Employees exercise more autonomy
 Less office overhead expense
 Disadvantages:
 Requires investment in ICT, which may be unreliable
 Employees are harder to control
 Less job security for employees
 Outsourcing, offshoring, and reshoring
 Outsourcing/subcontracting
 Transferring the internal business activities to an external firm
 e.g. business outsources bookkeeping duties to accounting firms
 Reasons
 Activities are not the core function of the business
 Business lacks the specific skills
 Cost reduction
 Advantages
 Better focus on core activities
 Helps reduce production and labor costs
 Ensures high quality standards
 Disadvantages
 Requires effective two-way communication, coordination and mutual
trust
 Subcontractors need to be monitored and managed properly
 Quality inconsistency
 Possibility of unethical practices
 Offshoring
 Transferring of internal business activities overseas
 Usually done in countries with low minimum wage
 Reasons
 Cut down labor costs
 Enter new markets in growing countries
 Overcome political limitations and regulations
 Advantages
 Reduce labor cost
 Help the business expand and gain exposure
 Business has access to large talent pool
 Stimulate host country’s economy (job opportunities, trade, etc.)
 Disadvantages
 Language and cultural barrier
 Time difference
 Communication
 Reshoring
  Bringing back offshore/outsourced personnel and services back to the
original location
 Reasons
 Foreign labor costs are increasing
 Problems with delivery/logistics
 Advantages
 Greater control
 Increased proximity to customers/shorter supply chain
 Product quality may increase
 Disadvantages
 May still be more costly
 Local country may lack the labor supply
 Innovation, cultural differences, and ethical considerations
 Innovation
 “Culture of innovation”
 Company must hire innovative people and foster the environment for
innovation
 Involves training and development costs
 Innovation also affects HR itself
 Outsourcing, offshoring, Shamrock organization (see below)
 Cultural differences
 HR must manage cultural diversity within the company
 Productivity may be affected due to conflicts arising from culture
 Need to raise awareness on cultural differences between employees
 May imply behavioral training is needed
 Ethical considerations
 Need to follow anti-discrimination laws
 e.g. racial, sex, disability, etc.
 Equal pay
 Health and safety at work
 Costs for training employees and ensuring a safe environment
 May benefit from lower absenteeism, better image, and fewer
compensation claims