HUMAN

RESOURCE
PLANNING
Approaches To HRP
• Theoretically human resource planner has three
option to deal with human resource planning.
* Considering the social program like
education as consumption good and demand for
the such education will be an aggregate of
individual consumer demand and providing
facilities for education and training accordingly
*The second option is to view such programs
as investment and evaluate the return based on
investment made in such programs

* Considering Skilled manpower as basic input

to any production of goods and services with in the
economy and assess the skill requirements to
achieve predetermined economic growth system
and provide necessary education and training
Approaches To HRP

• Social Demand Approach

• Rate of Return Approach

• Manpower Requirement
Approach
Approaches To HRP

• Social Demand Approach

*The approach relies on the
assessment of society’s need for
the program.
* it is an aggregate of demand
for particular program in respect
of all individuals within the
society.
* It is not always possible,
particularly in large societies, to
assess individual demands for
program
Approaches To HRP

• Social Demand Approach

* Therefore, this approach
depends on the assessment of
trends and projection of social
demand for the program.
*Social demand approach is thus
capable of revealing the number
of demand for particular
program that may be expected
by a given target data, based on
past experience.
Approaches To HRP

• Social Demand Approach

* This approach is contingent upon certain
factor as well as suffer from problem related
to data used in the projection of demand
* For example projection of social demand for
education depends on the incomes of people,
direct costs of education, student grants,
existing standards of admissions and may
become wrong due to problems associated
with database on demographic aspects at
disaggregated levels such as district, block
and village data on wastage and stagnation in
education, and intensity of utilisation of
existing educational facilities
* Note :This approach suffer from problems
related to futurological approach
Approaches To HRP

• Rate of Return Approach

* Rate of return approach looks upon
education as a contributor to productivity and
in this sense, it is expected to facilitate
investment decisions in education.

* For example: investment in education

contributes towards expansion of facilities
and its return through direct monetary benefit
(like extra life time earnings received which
can be attributed to the investment).
Approaches To HRP

• Rate of Return Approach

* In this approach, HRP is seen as the
investment that yield benefits for the
organization.
* Estimation of rate of return
involves the calculation of internal
rate of return which equates the
present value of returns earned
throughout the future active life with
costs incurred soon after the
investment decision is made. There
are thus three parameters involved in
the estimation of rate of return.
Approaches To HRP
• Rate of Return Approach
*It will consider the
a)Cost associated with HRP
* Direct Cost
* Indirect Cost
b)Return associated with HRP
*Direct monetary
Benefits
*Indirect Monetary
Benefits
*Non Monetary
Benefits
c)Discount rate
*Rate of Loss due to
attrition
Approaches To HRP

• However, rate of return

approach is only indicative
of relative priorities. This
analysis does not take
cognizance of supply and
demand of skills in the labor
market. Therefore, it is
doubtful whether such an
approach is effective in
making investment decision.
Approaches To HRP
• Manpower Requirement Approach
*There is a definite link between
Human resource and economic
growth, and that lack of skilled
manpower in required numbers
impedes growth.
*Future manpower requirement is
forecasted based on the objectives to
be achieved .Then depending on the
forecast of requirement over a
specific period ,action plans or
direction to achieve is formulated
Approaches To HRP
• Manpower Requirement Approach
*The basic steps involved in this exercises
are -
-Anticipating the direction and
magnitude of the organization development
-Evolving norms for employing
manpower considering present and future
changes in the organization.
-Translating the objectives to be
achieved in terms of man power requirement
-Estimating the skills required from
manpower
-Analysing the implication of skill
estimated in achieving objective based on
availability, ease of accessibility and training
Approaches To HRP
• Manpower Requirement Approach
*The basic steps involved in this exercises
are -
-Anticipating the direction and
magnitude of the organization development
-Evolving norms for employing
manpower considering present and future
changes in the organization.
-Translating the objectives to be
achieved in terms of man power requirement
-Estimating the skills required from
manpower
-Analysing the implication of skill
estimated in achieving objective based on
availability, ease of accessibility and training
Approaches To HRP
Qualitative Approach

It is also known as bottom up

approach where the people at bottom
of the hierarchy are considered
/Involved in HRP process. When
such people are involved ,employees
concern will become the major
influencer in Human resource
planning activities rather than the
organizational objectives
Approaches To HRP
Quantitative Approach

*It is also known as Top down

approach where the people from the
top management draft the human
resource plan.
*This plan will be based on the
number (ie) as per the data available
in HRIS.
* It is management driven approach
Approaches To HRP

Mixed Approach

*It combines both the top down

and bottom up approach of HR
planning

*It is known as MBO of

HRP.

* It tends to create a balance

between employees and
management role in HRP