Lecture 5

Strategic resourcing and

Workforce planning
Part 1 – Strategic resourcing
 1.1. The objective of strategic
resourcing

• Strategic resourcing aims to ensure that

the organization has the people it needs to
achieve its business goals

Slide 3
 1.2. The strategic HRM approach to
resourcing

The integration of business and resourcing strategies is based on an

understanding of the direction in which the organization is going and the
determination of:
 the numbers of people required to meet business needs;

 the skills and behavior required;

 the impact of organizational restructuring;

 plans for changing the culture of the organization

Slide 4
 1.3. The components of strategic employee
resourcing

Developing the
organization’s
employee
Workforce value Resourcing Retention Flexibility Talent
planning proposition plans plans plans management
and its
employer
brand

Slide 5
Part 2 – Workforce Planning
HR planning Recruitment Selection

• How do • How do • How do

we know we get we
what them choose
employee interested the best
resources in us and person
we need? the job? for the
job?

International HRM © Bex Hewett 2014 Slide 7

 2.1. Impact of poor resourcing
• High levels of turnover
• Poor individual
• High recruitment costs performance
– Poor organisational
performance
• Poor interpersonal – Negative impact on
relations customer service or
product quality

• Negative impact onSlide 8

International HRM © Bex Hewett 2014
individual wellbeing
 2.2. Why HR planning is
important

• Clear links between organisation and HR plans = better competitive

advantage

• Better control over staffing costs and ensuring appropriate numbers

employed to meet current and future needs

• Enables better judgements to be made about the skills and attitude mix
in the organisation

• To maintain an appropriate profile of staff (e.g. diversity)

HR planning
International HRM © Bex Hewett 2014 Slide 9
 2.3. Aspects of HR
planning

• Identifying which jobs are needed to achieve

organisational aims (right jobs at the right time)

• Forecasting demand and supply:

– future HR needs
– internal supply
– external supply
HR planning
International HRM © Bex Hewett 2014 Slide 10
 2.4. Assessing demand

In order to have adequate future HR needs forecast, following points should be

taken into account:
1. Organization, behaviour and culture
HR implications checklist
- New tasks?
- For whom?
- What competencies needed?
- Relative importance of team/individual behaviour
- Deleted tasks?
- How will managers need to manage?

Slide 11
 2.4. Assessing demand

In order to have adequate future HR needs forecast, following points should be

taken into account:
1. Organization, behaviour and culture
Strategic brainstorming exercise: managers write a corporate goal in the
centre and brainstorm changes that need to take place in each of the four
areas, one area at a time

Organization

Culture Corporate goal Formal and

informal system

People Slide 12
 2.4. Assessing demand

In order to have adequate future HR needs forecast, following points should be

taken into account:

2. Employee numbers and skills (demand forecasting)

 It’s the traditional area of forecasting employee number demand based on
the organization’s strategic objectives.
 Both objective and subjective approached can be employed

Slide 13
 2.4. Assessing demand

• Objective methods
– Using information about past labour requirements to plan for the
future and
– Taking into account changing requirements influenced by
organisational goals, technology, growth/decline etc.
• Subjective methods
– ‘Top-down’ – senior management make judgement based on the
organisational direction/strategy
– ‘Bottom up’ – dept. managers make bids for resources based on
their experiences on the ‘front line’
International HRM © Bex Hewett 2014 Slide 14
 2.5. Assessing supply

• Internal
– High labour turnover may be a problem for supply (HR need to ask who is leaving
and why – push and pull factors)
– Are the right skills and attributes available internally? (linked to learning &
development strategy)

• External
– When unemployment is high, the potential pool of candidates is bigger.
– But is there a large enough pool of candidates with the right skills and attributes?
– Globalisation provides a potentially larger pool but immigration laws may restrict
movement for certain jobs

International HRM © Bex Hewett 2014 Slide 15

 2.5. Assessing Internal
supply

Analysing the current situation and projecting forward

1. Organization, behaviour and culture
- Employee engagement
- Motivation of employees
- Job satisfaction
- Organizational culture
- The way that people are managed
- Attitude to minority groups and equality of opportunity
- Commitment to organization and reasons for this
- ….

Slide 16
 2.5. Assessing Internal
supply

Analysing the current situation and projecting forward

2. Current and projected employee numbers and skills (employee supply)
Current employee supply can be analysed in both individual and overall statistical
terms. Factors need to be considered such as:
- Number of employees classified by function, department, occupation, job title,
competencies, skills, qualifications, training, age, length of service,
performance assessment results
- How the internal supply of employees will change and primarily how many will
leave
- Current level of employee turnover rate with segmented groups.
- Behavioural aspects: why people leave

Slide 17
 2.5. The PESTEL framework for external
analysis (1)

The PESTEL framework categorises

environmental influences into six main types:
political, economic,
social, technological,
environmental legal

Thus PESTEL provides a comprehensive list of

influences on the possible success or failure of
particular strategies.
18
 The PESTEL framework (2)

• Political Factors: For example, Government

policies, taxation changes, foreign trade
regulations, political risk in foreign markets,
changes in trade blocks (EU).

• Economic Factors: For example, business

cycles, interest rates, personal disposable income,
exchange rates, unemployment rates, GDP trends.

• Socio-cultural Factors: For example, population

changes, income distribution, lifestyle changes,
consumerism, changes in culture and fashion. 19
 The PESTEL framework (3)

• Technological Factors: For example,

new discoveries and technology
developments, ICT innovations, rates of
obsolescence, increased spending on
R&D.
• Environmental (‘Green’) Factors: For
example, environmental protection 20

regulations, energy consumption, global

warming, waste disposal and re-cycling.
 2.5. Assessing External Labor Market

• External supply pool from which employers attract

employees
• Components of labor market
– Labor force population: All individuals who are available for
selection if all possible recruitment strategies are used
– Applicant population: Subset of the labor force population
that is available for selection using a particular recruiting
approach
 2.5. Labor Market Components

– Applicant pool: All persons who are actually evaluated for

selection
• Applicant tracking system - Makes the recruiting process more effective
– Individuals selected for a job - When the candidates reject the
offer:
• HR staff members must move back up the funnel to the applicant pool
for other candidates
• HR staff, in extreme cases, may need to reopen the recruiting process
 2.5. Unemployment Rates and Labor
Markets

• Unemployment rates vary with business cycles

– Strict hiring adopted by companies due to
recessionary conditions
• Decreased customer spending
• Increased business competition
• Decreased need for new employees due to developments
in technology
 2.5. Different Labor Markets and
Recruiting
Industry and Occupational Labor Markets
These jobs represent the health care, retail,
and education industries

Educational and Technical Labor Markets

Considering the educational and technical
qualifications that define the people being recruited
Labor Markets

Geographic Labor Markets

Markets can be local, area or regional, national, or
international

Global Labor Markets

Firms expand by exporting work to overseas labor markets when
doing so is advantageous
 2.6. Recruiting Presence and Image

• Employment brand: Image of the organization that is

held by both employees and outsiders
– Company brand can help generate more recruits through
applicant self-selection
 2.7. Organization-Based
versus Outsourced Recruiting

• Recruitment process outsourcing (RPO)

–Improves the number and quality of recruiting
candidates
–Reduces recruiting costs
• Professional Employer Organizations (PEO) and
employee leasing
–Employer signs an agreement with the PEO
 2.7. Organization-Based
versus Outsourced Recruiting

– Staff is hired by the leasing firm and leased back to the company
for a fee
–Leasing firm:
• Writes the paychecks
• Pays taxes
• Prepares and implements HR policies
• Keeps all the required records for the employer
 2.8. Regular versus Flexible Staffing

• Employers are hesitant to hire full-time employees due to:

–Increased cost
–Economic conditions
–Excessive competition
–Government considerations
 2.8. Regular versus Flexible Staffing

• Temporary workers - Employers can hire their own staff

members or make use of agencies on a rate-per-day/week
basis
–Purpose of hiring temporary workers
• Match the firm’s needs with the right workers
• Avoid costs associated with benefits
• Enhance staffing flexibility
 2.8. Regular versus Flexible Staffing

• Independent contractors - Workers who perform specific

services on a contract basis
– Advantageous for the employer as they do not have to pay benefits
– Done by individuals who are:
• Highly skilled
• Highly experienced
• Not affected by familial responsibilities
 Staff on
Staff on permanent
permanent contract. ‘Functional
contract.
HR planning ‘Functional
flexibility’ == applying
flexibility’ applying skills
skills across
across aa wide
wide
range of
range of tasks.
tasks. Both:
Both:
-- ‘Horizontal
‘Horizontal flex.’
flex.’ == tasks
tasks outside
outside of
of
The flexible firm Self-employment
immediate job
immediate job
1: Secondary -- ‘Vertical
‘Vertical flex.’
flex.’ == taking
taking onon more
more senior
senior or
or
workers, internal, junior jobs
junior jobs
numerical and
functional flex.
Core group:
Primary workers Sub-
Agency
Internal labour contractin
workers
market g
Functional flexibility

2: Secondary
Two sets
Two sets of
of secondary
secondary workers:
workers:
workers, external, 1. Semi-permanent, numerically
1. Semi-permanent, numerically flex. flex. so
so
numerical flex. contracts can
contracts can be
be terminated
terminated easily.
easily.
Periphery workers,
Periphery workers, e.g.
e.g. self-employed,
self-employed, Also functionally
functionally flex.
flex.
Also
or employed
or employed by
by another
another organisation.
organisation. 2. Little
2. Little employment
employment security
security (so
(so
Out-sourcing
Highly numerically
Highly numerically flex.
flex. numerical flex.)
numerical flex.) Employed
Employed to to do
do
specific job (no functional flex.)
specific job (no functional flex.)
Atkinson (1984) – see Marchington and Wilkinson, 2012