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HUMAN RESOURCES PLANNING DEFINITIONS: Rigorous HR planning links people management to the organization's mission, vision, goals and

objectives, as well as its strategic plan and budgetary resources. A key goal of HR planning is to get the right number of people with the right skills, experience and competencies in the right jobs at the right time at the right cost The process by which management ensures that it has the right personnel, who are capable of completing those tasks that help the organization reach its objectives.
The ongoing process of systematic planning to achieve optimum use of an organization's most valuable asset - its human resources. The objective of human resource (HR) planning is to ensure the best fit between employees and jobs, while avoiding manpower shortages or surpluses. The three key elements of the HR planning process are forecasting labor demand, analyzing present labor supply, and balancing projected labor demand and supply

Definition According to R. Wayne Mondy's in "Human Resource Management," human resource planning is the systematic process of matching the internal and external supply of candidates with job openings that a company anticipates over a certain period of time. Put simply, human resource planning is keeping an up -to-date compilation of candidates inside and outside the company for future positions. Why human resource planning? Human Resource Planning: an Introduction was written to draw these issues to the attention of HR or line managers. We address such questions as: 1. what is human resource planning? 2. how do organisations undertake this sort of exercise? 3. what specific uses does it have?
In dealing with the last point we need to be able to say to hard pressed managers: why spend time on this activity rather than the other issues bulging your in tray? The report tries to meet this need by illustrating how human resource planning techniques can be applied to four key problems. It then concludes by considering the circumstances are which human resourcing can be used.

1. Determining the numbers to be employed at a new location If organisations overdo the size of their workforce it will carry surplus or underutilised staff. Alternatively, if the opposite misjudgement is made, staff may be overstretched, making it hard or impossible to meet production or service deadlines at the quality level expected. So the questions we ask are: How can output be improved your through understanding the interrelation between productivity, work organisation and technological development? What does this mean for staff numbers? What techniques can be used to establish workforce requirements? Have more flexible work arrangements been considered? How are the staff you need to be acquired? The principles can be applied to any exercise to define workforce requirements, whether it be a business start-up, a relocation, or the opening of new factory or office. 2. Retaining your highly skilled staff Issues about retention may not have been to the fore in recent years, but all it needs is for organisations to lose key staff to realise that an understanding of the pattern of resignation is needed. Thus organisations should: 1. monitor the extent of resignation 2. discover the reasons for it 3. establish what it is costing the organisation


compare loss rates with other similar organisations.

Without this understanding, management may be unaware of how many good quality staff are being lost. This will cost the organisation directly through the bill for separation, recruitment and induction, but also through a loss of long -term capability. Having understood the nature and extent of resignation steps can be taken to rectify the situation. These may be relatively cheap and simple solutions once the reasons for the departure of employees have been identified. But it will depend on whether the p roblem is peculiar to your own organisation, and whether it is concentrated in particular groups (eg by age, gender, grade or skill).

3. Managing an effective downsizing programme This is an all too common issue for managers. How is the workforce to be cut painlessly, while at the same time protecting the long-term interests of the organisation? A question made all the harder by the time pressures management is under, both because of business necessities and employee anxieties. HRP helps by considering: 1. the sort of workforce envisaged at the end of the exercise 2. the pros and cons of the different routes to get there 3. how the nature and extent of wastage will change during the run -down 4. the utility of retraining, redeployment and transfers 5. what the appropriate recruitment levels might be. Such an analysis can be presented to senior managers so that the cost benefit of various methods of reduction can be assessed, and the time taken to meet targets established. If instead the CEO announces on day one tha t there will be no compulsory redundancies and voluntary severance is open to all staff, the danger is that an unbalanced workforce will result, reflecting the take-up of the severance offer. It is often difficult and expensive to replace lost quality and experience. 4. Where will the next generation of managers come from? Many senior managers are troubled by this issue. They have seen traditional career paths disappear. They have had to bring in senior staff from elsewhere. But they recognise that while this may have dealt with a short-term skills shortage, it has not solved the longer term question of managerial supply: what sort, how many, and where will they come from? To address these questions you need to understand: 6. the present career system (including patterns of promotion and movement, of recruitment and wastage) 7. the characteristics of those who currently occupy senior positions 8. the organisations future supply of talent.
This then can be compared with future requirements, in number and type. These will of course be affected by internal structural changes and external business or political changes. Comparing your current supply to this revised demand will show surpluses and shortages which will allow you to take corrective action such as: 9. recruiting to meet a shortage of those with senior management potential 10. allowing faster promotion to fill immediate gaps 11. developing cross functional transfers for high fliers 12. hiring on fixed-term contracts to meet short-term skills/experience deficits reducing staff numbers to remove blockages or forthcoming surpluses. Thus appropriate recruitment, deployment and severance policies can be pursued to meet business needs. Otherwise processes are likely to be haphazard and inconsistent. The wrong sort of staff are engaged at the wrong time on the wrong contract. It is expensive and embarrassing to put such matters right.

How can HRP be applied? The report details the sort of approach companies might wish to take. Most organisations are likely to want HRP systems:

13. 14. 15. 16. 17. 18.

which are responsive to change where assumptions can easily be modified that recognise organisational fluidity around skills that allow flexibility in supply to be included that are simple to understand and use which are not too time demanding.

To operate such systems organisations need: 19. appropriate demand models 20. good monitoring and corrective action processes 21. comprehensive data about current employees and the external labour market an understanding how resourcing works in the organisation. If HRP techniques are ignored, decisions will still be taken, but without the benefit of understanding their implications. Graduate recruitment numbers will be set in ignorance of demand, or management succession problems will develop unnoticed. As George Bernard Shaw said: to be in hell is to drift; to be in heaven is to steer. It is surely better if decision makers follow this maxim in the way they make and execute resourcing plans.

TYPES OF HUMAN RESOURCES PLANNING HRD at micro and macro levels The human is recognized as the most effective input for maximum output and efficiency of any organisation. Hence the development of competency of this human input is very necessary for the lasting growth and development of the organisation. Human resource development is process of helping people to acquire new competencies. In organizational context, it is continuous and planned way to acquiring news capabilities of employees and creating opportunities for them and developing a sound organizational cultur e. HRD is often taken as synonym of training but besides training, it is overall development of the employees. HRD applies to both micro as well as macro issues. HRD develops the newer capabilities in people to enable them to achieve organizational goals. It ensures the long-term growth and development of the organisation which helps the economy of the nation.
Micro level At micro level, human resource development is related with grass-root development in organisations. It is well received by companies management as they realized its importance and foresee its future contribution for the individual and organizational development. Generally, HRD at micro level talks about organisations human resource planning, selection, training, performance appraisal, development, potential appraisal, compensation, organizational development etc. HRD involvement in all these areas mainly aims at developing new capabilities in people so that they could meet the present job challenges and prepare to accept future job requirements. Macro level At micro level, HRD is related with development of people for the nations well being. At this level, it involves health, skills, capabilities and attitudes of people which are more useful in development of nation as a whole. While calculating the national income and economic growth, HRD examines the individuals potential, attitudes, skill, aspirations, knowledge etc; and develops a concrete base for economic planning. However, HRD at macro level is not yet popular as it is at micro level. HUMAN RESOURCES PROCESS: Human resource planning process is the foundation of an effective workforce. The development of an organization is attributable to its committed and dedicated workforce. The term human resource implies human capital that operates an organization. The word planning suggests, a course of action. And lastly, process is the method of operation. Thus, the human resource planning process is defined as, 'a course of action that the human capital

takes up for a methodical achievement of predetermined goals'. The definition of human resource does not end here. The term includes, its management, which primarily involves issues related to the workforce. Human resource management (HRM) is the strategic and coherent approach to the management of an organization's most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business. A company may have all the financial resources it may need. But what if the manpower employed to manage the finances isn't well trained? Well, nothing more than your finances going down the drain. The recent 'Satyam' fraud was due to poor control of the management board. Improper human capital may gain the output, but not the desired one in terms of quality. As the earlier mentioned definition suggests, the human resource management means managing your valued assets. The term human resource management has replaced personnel management. However, the meaning is still the same. It involves, employing, developing, utilizing, managing and understanding the staff in an organization.

Importance of Human Resource Management Since the industrial revolution, the world has progressed tremendously. Be it the steel industry, IT, fashion houses or housing sectors, development in all of these is evident. However, over the ages man has indiscriminately used and abused the natural resources available to him. It has resulted in a global energy crises and depletion of resources in general.
In this backdrop, what remains is an abundance of human resource, or let's say human capital. To achieve any more goals, tapping the right kind of human resource is the key. You may have a business house worth millions of dollars. But what if there isn't the manpower that suits the nature of the business? Hence, developing the manpower is of utmost importance.

The Process of Human Resource Management Planning The human resource planning process, demands the HR manager to first understand the business requirement. Only if he comprehends the nature and scope of the business, will he be able to employ those who will deliver the required performance. When it comes to engaging the manpower, the manager should have a keen eye for spotting the talent. It ensures that the workforce is competent enough the meet the targets.
Additionally, the existing 'talent pool' in the workplace should be taken into consideration, so that people with complimentary skills can be employed. The functions of the HR manager are varied, he has to assess the currently employed workforce and their shortcomings. Identifying these shortcomings goes a long way in choosing an efficient workforce. While recruiting the new employees, the HR manager must calculate the expected workload. This way the HR department can design an accurate job profile and job expectations. Once you have the decided job descriptions, looking for candidates who fit the job will be easy. Don't be fooled by their qualifications, it is only t he relevant experience that matters more. A good HR manager is one who has the zeal and passion to motivate his prospective employees to perform to their potential. Human resource planning process, thus, can be considered as one of the strategic steps for building the strong foundation of an efficient workforce in an organization!

Human Resource Management: Evolution The early part of the century saw a concern for improved efficiency through careful design of work. During the middle part of the century emphasis shifted to the employee's productivity. Recent decades have focused on increased concern for the quality of w orking

life, total quality management and worker's participation in management. These three phases may be termed as welfare, development and empowerment.

Human Resource Management: Nature Human Resource Management is a process of bringing people and organ izations together so that the goals of each are met. The various features of HRM include: It is pervasive in nature as it is present in all enterprises. Its focus is on results rather than on rules. It tries to help employees develop their potential fully. It encourages employees to give their best to the organization. It is all about people at work, both as individuals and groups. It tries to put people on assigned jobs in order to produce good results. It helps an organization meet its goals in the future by providing for competent and well motivated employees. It tries to build and maintain cordial relations between people working at various levels in the organization. It is a multidisciplinary activity, utilizing knowledge and inputs dr awn from psychology, economics, etc. Human Resource Management: Scope The scope of HRM is very wide: 1. Personnel aspect-This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, layoff and retrenchment, remuneration, incentives, productivity etc. 2. Welfare aspect-It deals with working conditions and amenities such as canteens, crches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc. 3. Industrial relations aspect-This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc. Human Resource Management: Beliefs The Human Resource Management philosophy is based on the following beliefs: Human resource is the most important asset in the organization and can be developed and increased to an unlimited extent. A healthy climate with values of openness, enthusiasm, trust, mutuality and c ollaboration is essential for developing human resource. HRM can be planned and monitored in ways that are beneficial both to the individuals and the organization. Employees feel committed to their work and the organization, if the organization perpetuates a feeling of belongingness. Employees feel highly motivated if the organization provides for satisfaction of their basic and higher level needs. Employee commitment is increased with the opportunity to discover and use one's capabilities and potential in one's work. It is every manager's responsibility to ensure the development and utilisation of the capabilities of subordinates. Human Resource Management: Objectives
To help the organization reach its goals. To ensure effective utilization and maximum development of human resources. To ensure respect for human beings. To identify and satisfy the needs of individuals. To ensure reconciliation of individual goals with those of the organization. To achieve and maintain high morale among employees. To provide the organization with well-trained and well-motivated employees. To increase to the fullest the employee's job satisfaction and self-actualization. To develop and maintain a quality of work life. To be ethically and socially responsive to the needs of society.

To develop overall personality of each employee in its multidimensional aspect. To enhance employee's capabilities to perform the present job. To equip the employees with precision and clarity in transaction of bus iness. To inculcate the sense of team spirit, team work and inter-team collaboration.

PURPOSE AND ROLE OF HUMAN RESOURCES PLANNING In simple terms, an organization's human resource management strategy should maximize return on investment in the organization's human capital and minimize financial risk. Human resource managers seek to achieve this by aligning the supply of skilled and qualified individuals and the capabilities of the current workforce, with the organization's ongoing and future business plans and requirements to maximize return on investment and secure future survival and success. In ensuring such objectives are achieved, the human resource function is to implement an organization's human resource requirements effectively, taking into account federal, state and local labor laws and regulations; ethical business practices; and net cost, in a manner that maximizes, as far as possible, employee motivation, commitment and productivity.

Human Resource Management: Functions In order to achieve the above objectives, Human Resource Management undertakes the following activities: 1. Human resource or manpower planning. 2. Recruitment, selection and placement of personnel. 3. Training and development of employees. 4. Appraisal of performance of employees.

5. Taking corrective steps such as transfer from one job to another. 6. Remuneration of employees. 7. Social security and welfare of employees. 8. Setting general and specific management policy for organizational relationship. 9. Collective bargaining, contract negotiation and grievance handling. 10. Staffing the organization. 11. Aiding in the self-development of employees at all levels. 12. Developing and maintaining motivation for workers by providing incentives. 13. Reviewing and auditing manpower management in the organization 14. Potential Appraisal. Feedback Counseling. 15. Role Analysis for job occupants. 16. Job Rotation. 17. Quality Circle, Organization development and Quality of Working Life.
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Maintaining awareness of and compliance with local, state and federal labor laws Recruitment, selection, and on boarding (resourcing) Employee record-keeping and confidentiality Organizational design and development Business transformation and change management Performance, conduct and behavior management Industrial and employee relations Human resources (workforce) analysis and workforce personnel data management Compensation and employee benefit management Training and development (learning management) Employee motivation and morale-building (employee retention and loyalty)

Human Resource Management: Major Influencing Factors In the 21st century HRM will be influenced by following factors, which wil l work as various issues affecting its strategy: Size of the workforce. Rising employees' expectations Drastic changes in the technology as well as Life-style changes. Composition of workforce. New skills required. Environmental challenges. Lean and mean organizations. Impact of new economic policy. Political ideology of the Government. Downsizing and rightsizing of the organizations. Culture prevailing in the organization etc. Human Resource Management: Futuristic Vision On the basis of the various issues and challenges the following suggestions will be of much help to the philosophy of HRM with regard to its futuristic vision: 1. There should be a properly defined recruitment policy in the organization that should give its focus on professional aspect and merit based selection. 2. In every decision-making process there should be given proper weightage to the aspect that employees are involved wherever possible. It will ultimately lead to sense of team spirit, team-work and inter-team collaboration. 3. Opportunity and comprehensive framework should be provided for full expression of employees' talents and manifest potentialities. 4. Networking skills of the organizations should be developed internally and externally as well as horizontally and vertically. 5. For performance appraisal of the employees emphasis should be given to 360 degree feedback which is based on the review by superiors, peers, subordinates as well as selfreview. 6. 360 degree feedback will further lead to increased focus on customer services, creating of highly involved workforce, decreased hierarchies, avoiding discrimination and biases and identifying performance threshold.

7. More emphasis should be given to Total Quality Management. TQM will cover all employees at all levels; it will conform to customer's needs and expectations; it will ensure effective utilization of resources and will lead towards continuous improvement in all spheres and activities of the organization. 8. There should be focus on job rotation so that vision and knowledge of the employees are broadened as well as potentialities of the employees are increased for future job prospects. 9. For proper utilization of manpower in the organization the concept of six sigma of improving productivity should b e intermingled in the HRM strategy. 10. The capacities of the employees should be assessed through potential appraisal for performing new roles and responsibilities. It should not be confined to organizational aspects only but the environmental changes of political, economic and social considerations should also be taken into account. 11. The career of the employees should be planned in such a way that individualizing process and socializing process come together for fusion process and career planning should constitute the part of human resource planning.
To conclude Human Resource Management should be linked with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility. All the above futuristic visions coupled with strategic goals and objectives should be based on 3 H's of Heart, Head and Hand i.e., we should feel by Heart, think by Head and implement by Hand.

The Strategic Planning Process

In the 1970's, many large firms adopted a formalized top-down strategic planning model. Under this model, strategic planning became a deliberate process in which top executives periodically would formulate the firm's strategy, then communicate it down the organization for implementation. The following is a flowchart model of this process:

The Strategic Planning Process


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Situation Analysis
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Strategy Formulation
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This process is most applicable to strategic management at the business unit level of the organization. For large corporations, strategy at the corporate level is more concerned with managing a portfolio of businesses. For example, corporate level strategy involves decisions about which business units to grow, resource allocation among the business units, taking advantage of synergies among the business units, and mergers and acquisitions. In the process outlined here, "company" or "firm" will be used to denote a single-business firm or a single business unit of a diversified firm.

A company's mission is its reason for being. The mission often is expressed in the form of a mission statement, which conveys a sense of purpose to employees and projects a company image to customers. In the strategy formulation process, the mission statement sets the mood of where the company should go.

Objectives are concrete goals that the organization seeks to reach, for example, an earnings growth target. The objectives should b e challenging but achievable. They also should be measurable so that the company can monitor its progress and make corrections as needed.

Situation Analysis
Once the firm has specified its objectives, it begins with its current situation to devise a strategic plan to reach those objectives. Changes in the external environment often present new opportunities and new ways to reach the objectives. An environmental scan is

performed to identify the available opportunities. The firm also must know its own capabilities and limitations in order to select the opportunities that it can pursue with a higher probability of success. The situation analysis therefore involves an analysis of both the external and internal environment. The external environment has two aspects: the macro-environment that affects all firms and a micro-environment that affects only the firms in a particular industry. The macroenvironmental analysis includes political, economic, social, and technological factors and sometimes is referred to as a PEST analysis. An important aspect of the micro-environmental analysis is the industry in which the firm operates or is considering operating. Michael Porter devised a five forces framework that is useful for industry analysis. Porter's 5 forces include barriers to entry, customers, suppliers, substitute products, and rivalry among competing firms. The internal analysis considers the situation within the firm itself, such as:
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Company culture Company image Organizational structure Key staff Access to natural resources Position on the experience curve Operational efficiency Operational capacity Brand awareness Market share Financial resources Exclusive contracts Patents and trade secrets

A situation analysis can generate a large amount of information, much of which is not particularly relevant to strategy formulation. To make the information more manageable, it sometimes is useful to categorize the internal factors of the firm as strengths and weaknesses, and the external environmental factors as opportunities and threats. Such an analysis often is referred to as a SWOT analysis.

Strategy Formulation
Once a clear picture of the firm and its environment is in hand, specific strategic alternatives can be developed. While different firms have different alternatives depending on their situation, there also exist generic strategies that can be applied across a wide range of firms. Michael Porter identified cost leadership, differentiation, and focus as three generic strategies that may be considered when defining strategic alternatives. Porter advised against implementing a combination of these strategies for a given product; rather, he argued that only one of the generic strategy alternatives should be pursued.

The strategy likely will be expressed in high -level conceptual terms and priorities. For effective implementation, it needs to be translated into more detailed policies that can be understood at the functional level of the organization. The expression of the strategy in terms of functional policies also serves to highlight any practical issues that might not have been visible at a higher level. The strategy should be translate d into specific policies for functional areas such as:
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Marketing Research and development

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Procurement Production Human resources Information systems

In addition to developing functional policies, the implementation phase involves identifying the required resources and putting into place the necessary organizational changes.

Once implemented, the results of the strategy need to be measured and evaluated, with changes made as required to keep the plan on track. Control systems should be developed and implemented to facilitate this monitoring. Standards of performance are set, the actual performance measured, and appropriate action taken to ensure success.

Dynamic and Continuous Process

The strategic management process is dynamic and continuous. A change in one component can necessitate a change in the entire strategy. As such, the process must be repeated frequently in order to adapt the strategy to environmental changes. Throughout the process the firm may need to cycle back to a previous stage and make adjustments.

Drawbacks of this Process

The strategic planning process outlined above is only one approach to strategic management. It is best suited for stable environments. A drawback of this top -down approach is that it may not be responsive enough for rapidly changing competitive environments. In times of change, some of the more successful strategies emerge informally from lower levels of the organization, where managers are closer to customers on a day-today basis. Another drawback is that this strategic planning model assumes fairly accurate forecasting and does not take into account unexpected events. In an uncertain world, long -term forecasts cannot be relied upon with a high level of confidence. In this respect, many firms have turned to scenario planning as a tool for dealing with multiple contingencies.