Subject Name: Human Resource

Management
Topic Name(s): HRP Process
Lecture No: 7
Sakshi Arora,
ISBM

11/05/2022 Lecture Number, Unit Number 1

Human Resources Planning

BASICS

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 HRP(Human Resource Planning)
HRP is a process of analyzing & identifying the
need for & availability of human resources (HR)
so that organization can meet its objectives

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 Features of HRP
• It is future oriented: Human Resource Planning is forward-looking. It involves
forecasting the manpower needs for a future period so that adequate and
timely provisions may be made to meet the needs.
• It is a continuous process: Human Resource Planning is a continuous process
because the demand and supply of Human Resource keeps fluctuating
throughout the year. Human Resource Planning has to be reviewed
according to the needs of the organization and changing environment.
• Integral part of Corporate Planning: Manpower planning is an integral part
of corporate planning because without a corporate plan there can be no
manpower planning.
• Optimum utilization of resources: The basic purpose of Human Resource
Planning is to make optimum utilization of organisazion’s current and future
human resources.

11/05/2022 Lecture Number, Unit Number 4

• Both Qualitative and Quantitative aspect: Human Resource
Planning considers both the qualitative and quantitative aspects
of Human Resource Management, ‘Quantitative’ meaning the
right number of people and ‘Qualitative’ implying the right
quality of manpower required in the organization.
• Long term and Short term: Human Resource Planning is both
Long-term and short-term in nature. Just like planning which is
long-term and short-term depending on the need of the hour,
Human Resource Planning keeps long-term goals and short-
term goals in view while predicting and forecasting the
demand and supply of Human Resource.

11/05/2022 Lecture Number, Unit Number 5

 Need for Human Resource Planning

An organization must plan out its human resource  requirements

well in advance so that it could complete effectively with its
competitors in the market. A well  thought-out-human
resource plan provides adequate lead time for recruitment,
selection and training of personnel.

11/05/2022 Lecture Number, Unit Number 6

• Shortage of Skills: These days we find shortage of skills in
people. So it is necessary to plan for such skilled people
much in advance than when we actually need them. Non-
availability of skilled people when and where they are
needed is an important factor which prompts sound Human
Resource Planning.
• Frequent Labor Turnover: Human Resource Planning is
essential because of frequent labor turnover which is
unavoidable by all means. Labor turnover arises because of
discharges, marriages, promotion, transfer etc which causes
a constant ebb and flow in the workforce in the organization.

11/05/2022 Lecture Number, Unit Number 7

• Changing needs of technology: Due to changes in technology
and new techniques of production, existing employees need
to be trained or new blood injected into an organization.
• Identify areas of surplus or shortage of personnel:  
Manpower planning is needed in order to identify areas with
a surplus of personnel or areas in which there is a shortage
of personnel. If there is a surplus, it can be re-deployed, or if
there is a shortage new employees can be procured.
• Changes in organization design and structure: Due to
changes in organisation structure and design we need to
plan the required human resources right from the beginning.

11/05/2022 Lecture Number, Unit Number 8

 HRP Process
• HRP PROCESS:

1. Environmental scanning
2. Forecasting & analyzing demand for HR
3. Forecasting & analyzing supply of HR
4. Developing action plans to match HR demand &
supply

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 Environmental Scanning
Environment scanning refers to the systematic
monitoring of the external forces influencing the
organization.
Managers monitor several forces but the following
are pertinent for HRP :
• Economic factors
• Technological factors
• Demographic factors
• Political factors
By scanning the environment for changes, managers
can anticipate their impact & adjustment early.

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Organizational objectives and policies
In developing these objectives ,specific policies need to
be formulated to address the following aspects.
1. Are vacancies to be filled through promotions?
2. How to implement downsizing plan?

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 Forecasting HR Demand
• FORECASTING ‘makes use of information from the
past & present to identify expected future
conditions’.

• Forecasts are not perfectly accurate & as the

planning scope becomes shorter the accuracy of
forecasts increases

• HR demand forecasts may be internal / external

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 Causes of Demand

WORKFORCE FACTORS :
– Demand is modified by employee actions such as
– retirements,
– resignations,
– terminations,
– death, &
– leaves of absence

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 Forecasting Techniques
1. Managerial Judgement: In this all managers sit together,
discuss and arrive at a figure which would be the future
demand for labour. This is very easy technique.
2. Ratio Trend Analysis: This is the quickest forecasting
technique. This technique involves studying past ratios, say,
between the number of workers and sales in an organization
and forecasting future ratios, making some allowance for
changes in the organization or its method.
3. Delphi Technique: This technique is the method of
forecasting personnel needs. It forecasting of personnel needs
from a group of experts, usually managers.

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 Forecasting & Analyzing HR Supply

– Internal supply forecasts relate to conditions inside

the org. such as age distribution of workforce,
terminations, retirements, etc.
– External supply forecasts relate to external labour
market conditions & estimates of supply of labour
to be available to the firm in the future in different
categories

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 Supply Analysis
• Existing human resources
• Internal sources of supply
• External sources of supply

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 Existing human resources
• Skill inventories – info about non-managers.
• 1. Personal data
• 2. Skills
• 3. Special qualifications
• 4. Salary and job history
• 5. Company data
• 6. Capacity of individual

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 Uses Of Human Resource System
• HR planning and analysis
• Equal employment
• Staffing
• HR development
• Compensation and benefits
• Health, Safety and security
• Employee and labor relations

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 Management inventories

1. Promotion potential
2. Career goals
3. Strength
4. Weakness
5. Total budget managed
6. Previous management duties.

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 Internal sources of supply
• Inflows and outflows
• IS= current supply – outflow + inflow Turnover rate
No of separations during one year × 100 Average no
of employees during the year

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 External sources of supply

• New blood and new experience

• To replenish old personnel
• Organizational growth

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 HR Programming
• After personal demand and supply are forecast the
vacancies should be filled at right time with right
employee

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 HR Plan Implementation
Converting HR plan into action.
Action programmes are..
• Recruitment
• Selection & placement
• Training and development
• Retraining
• The succession plan

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 Control and Evaluation
• Establish the reporting procedures
• It should report employment costs against budget
and trends in wastage and employment ratios

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