BAHR 211 | HUMAN RESOURCE MANAGEMENT

MS. PRINCESS G. COLE, MBA

Lesson 2 | The Process of Human Resource Planning

Essential Terms:

1. Human Resource Planning Process – It involves creating and maintaining a plan that talks
about meeting the needs of business in human resource activity. The HR plan must align in
an organizational strategic plan to enable support and attain business goals.
2. Skills Inventory – HR staff uses to assess and record current employees' soft and hard skills,
education, and experiences. These are usually used to guide good decision making on
performance appraisal, training and development, promotion, career management, and
separation.
3. Labor Market – The place where the supply and demand for jobs meet together. For
instanced job fair, this is where HR recruitment specialists and applicants meet in attaining
job placement.
4. HR Demand Forecast – The process of projecting, estimating the quantity and quality of
people required to meet the company's future needs.
5. HR Supply Forecast – It determines whether the HR Department will be able to procure the
required number of personnel. Specifically, the supply forecast measures the number of
people likely to be available from within and outside in the organizations.
6. Job Posting – The business publishes job openings on bulletin boards, electronic media,
and similar outlets.
7. Transfer – An internal movement within the same grade, from one job to another.
8. Promotion – Involves an employee's movement from a lower-level position to a higher level
position accompanied by changes in duties, status, and value.
9. Demotion – To reduce into a lower grade, rank, or position within a company's
organizational hierarchy.
10. Retrenched employees – An act of dismissing employees because of losses in a business's
operation and considerable reduction in the volume of the company.
11. Telecasting – It is a program that is broadcast on television about job hiring.
12. Employment exchanges – Refers to an office of the central or state government, which
collects and furnishes information on the prospective employers, available vacancies and
job seekers, thereby facilitating job seekers to find a suitable job and for the industry to find
the appropriate manpower.
13. Job Fair – Known as a job fair or career expo. A recruiting event in which employers and
recruiters meet with potential employees and where job seekers find more about job
openings at potential employers.

ASPECT OF HUMAN RESOURCE PLANNING PROCESS

Human Resource Planning is a process by which a company decides how an organization should
move from its current manpower position to its desired manpower position

It requires an assessment of the availability of the qualified resources that will be needed. Human
resources planning should be a key component of nearly every corporation’s strategic business
planning. To ensure their competitive advantage in the marketplace, organizations must
implement innovative strategies designed to enhance their employee retention rate and recruit
fresh talent into their companies.

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Adequate human resources planning strategies include having sufficient staff, the right mixture of
talent, and who are in the appropriate locations, performing their jobs when needed. It moves
beyond the traditional role of human resources as primarily an administrative control function. It
is viewed as a valuable component for adding value to an organization in today's corporate
environment. Both employees and the company will often realize many benefits of planning over
the long-run.

It means forecasting or anticipation of manpower and identifying the future human resources
needs to ensure the healthy operation of the organization and avoid interruption of work activities.
Specifically, it seeks to determine the following:

1. What kind of employees needed?

2. How many employees needed?
3. What are the positions, salary, job description, and job specification, and status of
employees?

STEPS IN HUMAN RESOURCES PLANNING

1. Prepare a forecast. This is where you anticipate how many employees you'll need in the future.
The longer you've been in business, the more accurate your number will be because you can look
at your past growth and forecast based on those numbers. For example, if your company has
grown by 25% in the past three years, there's a good chance that you'll need at least one
employee in the very near future. However, if your industry experience suggests that this could be
a quiet year, you may include that in your planning, too. So, your business's history and industry
experience will be your guide in Step One as you consider your product's supply and demand.

2. Develop an HR inventory. This is relatively easy for most small businesses: there's just one of you!
But if you're a growing business with a couple of employees already, that should figure into your
planning, too. Do you forecast a need for ten employees but currently have 2? Simple math
suggests that you need eight additional employees. As you grow, this step becomes more critical
as you factor employee turnover into the equation.

3. Develop a job analysis. This could be the hardest part of the process; you'll need to figure out
what each person will do even though you haven't hired them yet. Of course, this level of planning
isn't going to be airtight and may change over time. Still, it will give you an idea about what you'll
be getting people to do, and it can help you train your current employees if their job description
doesn't currently match the job description that they'll have when you have more employees.
Don't forget that any current employees will be managing the ones hired after them, so be sure
to include some management-level tasks in your job analysis.

4. Prepare a comprehensive plan. This will be the most time consuming of the steps, but it is the
most critical. This step will give you the path you'll take to integrate new employees into your
business successfully. It should include budgeting for future wages, and it should include training
techniques to bring current employees up to the skill level you want them to be at. For employees
that you have yet to hire, prioritize to determine whom you'll hire first. For every anticipated
position, include goal dates in which you'd like to have people hired by and work backward by 3
to 6 months (or more, depending on the employment situation in your area) to start advertising
and interviewing. Write down where you'll advertise and the skill set you are going to need.

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IMPORTANCE OF HUMAN RESOURCE PLANNING

1. To carry on work
2. People need to be replaced
3. People leave the organization
4. Companies expand
5. Changing needs that cannot be met by old labor force
6. To right-size the company

FACTORS AFFECTING HUMAN RESOURCE PLANNING

1. Type and strategy of the organization.

2. Organizational growth cycle and planning
3. Environmental Uncertainties
4. Time horizons
5. Type and quality of forecasting information
6. Nature of jobs being filled
7. Outsourcing issues

LABOR MARKET

1. EXTERNAL LABOR MARKET

In this aspect, HR personnel tends to find an applicant outside of the company to seek
greater opportunities. They believed that it is more practical and effective if they can pool
manpower externally.

2. INTERNAL LABOR MARKET

Workers are hired within the company, either entry-level and higher-level jobs. It is used as
a company strategy to ensure investment in developing company-specific knowledge
and retain their workforces effectively.

SOURCES OF RECRUITMENT

Internal Sources External Sources

Transfer Recruitment at the factory gate
Promotion Casual Callers
Upgrading Advertisement
Demotion Employment Agencies
Retired Employees Management Consultants
Retrenched Employees Educational Institutions
Dependent & Relatives Recommendations
8. Deceased Employees Labor Contactors
Telecasting
Employment exchanges
Unsolicited applicants
School Campus
Job Fair
Online advertisement

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 Recruiting Advantages Disadvantages
Source
Internal • The moral of the promotion is • “Inbreeding” results.
usually high. • Those not promoted may
• The firm can better assess a experience moral problems.
candidate’s abilities. • Employees may engage in
• Recruiting costs are lower for “political’ infighting for
some jobs. promotions.
• The process causes a succession • A management development
of promotions. program is needed.
• The firm has to hire only at entry-
level.

External • New “blood” brings new
perspectives.
• Training new hires are cheaper
and faster because of prior
external experience.
• The new hire has no group of
“political supporters” in the
organization.
• The new hire may bring new
industry insights.
• The firm may not select
someone who will fit the job or
the organization.
• The process may cause morale
problems for internal candidates
not selected.
• The new employee may require
a longer adjustment or
orientation time.

Source: R. Mathis and J. Hackson, 2005. Recruiting in Labor Markets

Business is doing a practical way to lessen the risk in looking the right person, for the right job, at
the right time, and the place. Choosing the right source for pooling manpower depends on the
nature, strategy, and objectives of the business organization.

ROLE OF HR DEPARTMENT

The roles and responsibilities of the HR Department cannot be described easily it is because they
are not only concerned in their department but the entire organization as well, where people exist
either vertical or horizontal level. Furthermore, they are committed to giving an organization a
reliable, competitive manpower, and harmonious environment.

Specifically, there are two separate functions in managing human resources; these are:

A. Human Resource Generalist. A person who devotes a majority of working time to human
resources issues, but does not specialize in any specific areas.

B. Human Resource Specialist. They are specially trained in one or more human resource
management areas, including responsible as labor relation specialist, wage, and salary
specialist.

In addition, they are responsible for maintaining positive employee relations and ensuring people's
unity and involvement in the organization. Hence, HR provides quality services to satisfy the
business organization's internal customers by preparing and distributing information employee's
handbooks, company publications, and newsletters. At the same time, they are dealing with and
responding to communications from employees about questions on benefits and company
policy, questions regarding the possible occurrence of discrimination, safety hazards, and possible

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harassment. In terms of labor relations, they participate collaboratively with the employees on
collective bargaining activity, and contract administration enables them to hear the employee's
opinions and suggestions for improving the organization.

HR FUNCTION AND RESPONSIBILITIES

FUNCTION
Analysis and Design of Work
Recruitment and Selection
Training and Development
Performance Management
Compensation and Benefits
Employee Relations
Personnel Policies
Compliance with Laws
Support for Strategy
RESPONSIBILITIES
Work Analysis; Job Design; Job Descriptions
Recruiting; Job Postings; Interviewing; Testing; Coordinating Use of
Temporary Labor
Orientation, Skills Training; Career Development Programs
Performance Measures; Preparation and Administration of
Performance Appraisals; Discipline
Wage and Salary Administration; Incentive Pay; Insurance; Vacation
Leave Administration; Retirement Plans; Profit Sharing; Stock Plans
Attitude Surveys; Labor Relations; Employee Handbooks; Company
Publications; Labor Law Compliance; Relocation and Outplacement
Services
Policy Creation; Policy Communication; Record Keeping; HR
Information Systems
Policies to ensure lawful behavior; reporting; posting information; safety
inspections; accessibility accommodations
Human Resource Planning and Forecasting; Change Management