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Nat|ona| Inst|tute of 8us|ness Management

Module name Puman 8esource ManagemenL Module 1lLle Adbm 204


Ca[aba ereraCunawardenaManagemenL ConsulLanL
lnLroducLlon Lo Puman 8esource lannlng
Introduct|on
Puman resources managemenL ls a crlLlcally lmporLanL and challenglng area of managemenL
1he lmporLance lles ln Lhe facL LhaL lL ls concerned wlLh Lhe human dlmenslon ln an
organlzaLlon lL ls an area whlch grew along wlLh Lhe evoluLlon of Lhe early sLages Modern
ManagemenL known as 'Classlcal ManagemenL approach' lnlLlally Lhe eople ulmenslon"
was noL recognlzed ln facL eople ulmenslon" was noL ln Lhe managemenL parlance slnce
'people' or workers' were consldered as [usL anoLher one ln Lhe facLors of producLlon
perspecLlve uurlng Lhe SclenLlflc ManagemenL era more emphasls was placed ln Lhe
Lechnologlcal aspecLs of an organlzaLlon roducLlvlLy was consldered a funcLlon 1echnology ln
whlch Lhe worker was only a cog ln Lhe' Machlne' Powever wlLh Lhe emergence of Lhe Puman
8elaLlons School credlLed Lo LlLon Mayo as Lhe chlef proponenL Lhe managerlal aLLlLude
Lowards Lhe employee" changed across many more guldlng phllosophles wlLnessed durlng Lhe
LranslLlon from Classlcal ManagemenL Lo Modern ManagemenL ln Lhe MeLamorphosls of Lhe
managemenL Lheory Lhe mosL lmpelllng force had been Lhe growlng focus and recognlLlon of
Lhe crlLlcal lmporLance of Lhe people ulmenslon" ln CrganlzaLlon SLraLegy 1hls ls known as
SLraLeglc 8esource ManagemenL
Human Resource Management (HRM) is the term used to describe Iormal systems devised Ior
the management oI people within an organization. These human resources responsibilities are
generally divided into three major areas oI management: staIIing, employee compensation, and
deIining/designing work. Essentially, the purpose oI HRM is to optimize the productivity oI an
organization by optimizing the eIIectiveness oI its employees. This mandate is unlikely to
change in any Iundamental way, despite the ever-increasing pace oI change in the business
world. As Edward L. Gubman observed in the Journal of Business Strategy, "the basic mission
of human resources will always be to acquire, develop, and retain talent; align the
workforce with the business; and be an excellent contributor to the business. Those three
challenges will never change."
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&ntil Iairly recently, an organization's human resources department was oIten relegated to lower
rungs oI the corporate hierarchy, despite the Iact that its mandate is to replenish and nourish the
company's work Iorce, which is oIten cited, legitimately, as an organization's greatest resource.
However, in recent years recognition oI the importance oI human resources management to a
company's overall health has grown dramatically. This recognition oI the importance oI HRM
extends to small businesses. Though they do not generally have the same volume oI human
resources requirements as do larger organizations, they too Iace personnel management issues
that can have a decisive impact on business health. As Irving Burstiner commented in %e Small
Business Handbook, "Hiring the right people and training them well can oIten mean the
diIIerence between scratching out the barest oI livelihoods and steady business growth..
Personnel problems do not discriminate between small and big business. You Iind them in all
businesses, regardless oI size."
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Human Resource Planning

If the main objective of human resource management is to acquire, develop, and retain
talent; align the workforce with the business; and be an excellent contributor to the
business, HR Planning is 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 9o ensure 9e bes9 fi9 be9een employees and jobs, ile
avoiding manpoer sor9ages or surpluses. The three key elements of the HR planning
process are forecas9ing labor demand, analyzing presen9 labor supply, and
balancing projec9ed labor demand and supply.
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Human resource planning is the process of anticipating and carrying out the movement of
people into, within, and out of the organization. The main purpose of human resources
planning is to achieve the optimum use of human resources and to have the correct number
and types of employees needed to meet organizational goals.

It can also be defined as the task of assessing and anticipating the skill, knowledge and
labor time requirements of the organization, and initiating action to fulfill or `source
(outsource) those requirements.

'Manpower planning has maintained its imperatives Ior several reasons: i) a growing awareness oI
the need to look into the Iuture, ii) a desire to exercise control over as many variables as possible
which inIluence business success or Iailure, iii) the development oI techniques which make such
planning possible.'


P8 ls Lhe process by whlch an organlzaLlon ensures LhaL lL has Lhe rlghL number and klnds of people aL
Lhe rlghL places aL Lhe rlghL Llme and LhaL Lhese people are capable of performlng Lhelr Lasks effecLlvely
and efflclenLly 1hls helps Lhe organlzaLlon Lo achleve lLs overall ob[ecLlves 1wo ma[or ways ln whlch
socleLal Lrends affecL employmenL ls Lhrough consumer markeLs whlch affecL Lhe demand for goods and
servlces and labor markeLs whlch affecL Lhe supply of people needed Lo produce goods and servlces

1 Cubman Ldward L 1he CaunLleL ls uown !ournal of 8uslness SLraLegy novemberuecember
1996
2 8ursLlner lrvlng 1he Small 8uslness Pandbook renLlce Pall 1988
ead more http]]www|nvestoped|acom]terms]h]humanresource
p|ann|ngasp#|xzz1a[y12bSy


P8 ls Lhe process by whlch an organlzaLlon ensures LhaL lL has Lhe rlghL number and klnds of people aL
Lhe rlghL places aL Lhe rlghL Llme and LhaL Lhese people are capable of performlng Lhelr Lasks effecLlvely
and efflclenLly
1hls helps Lhe organlzaLlon Lo achleve lLs overall ob[ecLlves 1wo ma[or ways ln whlch socleLal Lrends
affecL employmenL ls Lhrough consumer markeLs whlch affecL Lhe demand for goods and servlces and
labor markeLs whlch affecL Lhe supply of people needed Lo produce goods and servlces

@he strateg|c n p|ann|ng process has four steps
O Assesslng Lhe currenL P8 capaclLy
O orecasLlng P8 requlremenLs
O Cap analysls
O ueveloplng P8 sLraLegles Lo supporL organlzaLlonal sLraLegles
Assesslng currenL P8 capaclLy
8ased on Lhe organlzaLlons strateg|c p|an Lhe flrsL sLep ln Lhe sLraLeglc P8 plannlng process ls Lo assess
Lhe currenL P8 capaclLy of Lhe organlzaLlon 1he knowledge skllls and ablllLles of your currenL sLaff need
Lo be ldenLlfled 1hls can be done by developlng a ski//s inventory for each employee
1he ski//s inventory should go beyond Lhe skllls needed for Lhe parLlcular poslLlon LlsL all skllls each
employee has demonsLraLed or example recreaLlonal or volunLeer acLlvlLles may lnvolve speclal skllls
LhaL could be relevanL Lo Lhe organlzaLlon LducaLlon levels and cerLlflcaLes or addlLlonal Lralnlng should
also be lncluded
An employees performance assessmenL form can be revlewed Lo deLermlne lf Lhe person ls ready and
wllllng Lo Lake on more responslblllLy and Lo look aL Lhe employees currenL developmenL plans
orecast|ng n requ|rements
1he nexL sLep ls Lo forecasL P8 needs for Lhe fuLure based on Lhe sLraLeglc goals of Lhe organlzaLlon
8eallsLlc forecasLlng of human resources lnvolves esLlmaLlng boLh demand and supply CuesLlons Lo be
answered lnclude
-Pow many sLaff wlll be requlred Lo achleve Lhe sLraLeglc goals of Lhe organlzaLlon?
-WhaL [obs wlll need Lo be fllled?
-WhaL sklll seLs wlll people need?
When forecasLlng demand for P8 care should be Laken assess Lhe challenges arlslng from exLernal
envlronmenL ln meeLlng your sLafflng needs
-Pow wlll Lhe exLernal envlronmenL lmpacL on our P8 needs?

Cap analysls
1he nexL sLep ls Lo deLermlne Lhe gap beLween where your organlzaLlon wanLs Lo be ln Lhe fuLure and
where you are now 1he gap analysls lncludes ldenLlfylng Lhe number of sLaff and Lhe skllls and ablllLles
requlred ln Lhe fuLure ln comparlson Lo Lhe currenL slLuaLlon ?ou should also look aL all your
organlzaLlons P8 managemenL pracLlces ln order Lo ldenLlfy pracLlces LhaL could be lmproved or new
pracLlces needed Lo supporL Lhe organlzaLlons capaclLy Lo move forward
CuesLlons Lo be answered lnclude
-WhaL new [obs wlll be needed?
-WhaL new skllls wlll be requlred?
-uo our presenL employees have Lhe requlred skllls?
-Are employees currenLly ln poslLlons LhaL use Lhelr sLrengLhs?
-uo we have enough managers/supervlsors?
-Are currenL P8 managemenL pracLlces adequaLe for fuLure needs?


Deve|op|ng n strateg|es to support organ|zat|ona| strateg|es
- Lnsures opLlmum use of Lhe workforce and caplLallze on Lhe sLrengLh of P8 1he organlzaLlon can have
a reservolr of LalenL aL any polnL of Llme eople skllls are readlly avallable Lo carry ouL Lhe asslgned
Lasks lf Lhe lnformaLlon ls collecLed and arranged beforehand
- orecasL fuLure requlremenLs
- Pelp deLermlne recrulLmenL/lnducLlon levels
- 1o anLlclpaLe redundancles/ surpluses/obsolescence
- 1o deLermlne Lralnlng levels and works as a foundaLlon for managemenL developmenL programs
1ralnlng and developmenL needs can be meL ln a varleLy of ways Cne approach ls for Lhe employer Lo
pay for employees Lo upgrade Lhelr skllls 1hls may lnvolve sendlng Lhe employee Lo Lake courses or
cerLlflcaLes or lL may be accompllshed Lhrough onLhe[ob Lralnlng
8ecrulLmenL sLraLegles 1hls sLraLegy lncludes
-8ecrulLlng new sLaff wlLh Lhe skllls and ablllLles LhaL your organlzaLlon wlll need ln Lhe fuLure
-Conslderlng all Lhe avallable opLlons for sLraLeglcally promoLlng [ob openlngs and encouraglng
sulLable candldaLes Lo apply
Some organlzaLlons ouLsource P8 acLlvlLles pro[ecL work or bookkeeplng or example payroll may be
done by an exLernal organlzaLlon raLher Lhan a sLaff person a shorL Lerm pro[ecL may be done uslng a
consulLanL or speclflc experLlse such as legal advlce may be purchased from an ouLslde source
Lach ouLsourclng declslon has lmpllcaLlons for meeLlng Lhe organlzaLlons goals and should Lherefore be
carefully assessed
osslble P8 plannlng sLraLegles Lo meeL organlzaLlonal sLraLegy are
-uevelop a recrulLmenL and reLenLlon sLraLegy and provlde professlonal developmenL opporLunlLles
LhaL glve Lhem lncreased skllls for deallng wlLh Lhe lssues Lhelr cllenLs face
-ueclde Lhe unlque sLraLegles LhaL you wlll use Lo poslLlon yourself as an employer of cholce based on
needs of your employees and poLenLlal candldaLes
Issues re|at|ng to Sr| Lankan Crgan|zat|ons
1he maln and Lhe mosL slgnlflcanL lssue ln ma[orlLy of CrganlzaLlons boLh ln Lhe publlc and prlvaLe
secLors ls LhaL appllcaLlon of P8M pracLlces ls done aL a superflclal level wlLhouL much recognlLlon and
commlLmenL
MosL of Lhe P8 racLlces are applled ln a fragmenLed manner 1here ls a wlde gap beLween Lhe P8
pracLlces and Lhe sLraLeglc plan of Lhe CrganlzaLlon
1he leasL used P8 racLlce ls P8 lannlng even ln Lhe CrganlzaLlons where SLraLeglc lannlng ls used
Cha||enges
Srl Lankan CrganlzaLlons boLh ln Lhe ubllc and rlvaLe secLors should serlously revlew Lhelr P8
racLlces and recognlze lLs lmperaLlve conLrlbuLlon Lo CrganlzaLlon success Lhrough lmproved
producLlvlLy and compeLlLlveness
ln vlew of Lhe above and Lhe rapld lncrease ln economlc and soclal developmenL experlenced ln Lhe posL
confllcL era Lop managemenL ln Lhe Srl Lankan CrganlzaLlons ln Lhe ubllc and rlvaLe secLors should
serlously revlew Lhelr managemenL pracLlces and recognlze Lhe lnseparable llnk beLween Lhe P8M
funcLlon and racLlces for Lhe success of Lhelr CrganlzaLlon SLraLeglc lan and Lhe plannlng process
1he corporaLe leadershlp should be consclous of Lhe need Lo orlenL ourselves Lo Lhe lnLernaLlonal
markeL parLlcularly ln vlew of Lhe fallure of Lhe lnLernaLlonal markeLs and Lhe lmpendlng recesslon
1he vasL opporLunlLles avallable ln Lhe shorL run could only be explolLed by lmprovlng organlzaLlon
efflclency and compeLlLlveness