Hrm-human Resource Planning 3

8/3/2019 Hrm-human Resource Planning 3

1/38

HUMAN RESOURCEPLANNING


2/38

Introduction

Success in business is dependent on: Reacting quickly to opportunities

Rapid access to accurate information

Human resource planning (HR planning): How organizations assess the future supply of,

and demand for, human resources

Provides mechanisms to eliminate gaps that may

exist between supply and demand Requires readjustment as labor market conditions

change


3/38

Introduction

The types of people employed and thetasks they perform determine the kind ofplanning necessary

HR planning is critical for implementation of the

organizations strategic plan HR policies have direct effects on profitability

Strategic human resource management

(SHRM) means acknowledging that HRpolicies/practices have critical links to anorganizations overall strategy


4/38

Definitions of HR Planning

strategy for the acquisition, utilisation,improvement and preservation of an

organisations human resources

(Department of Employment 1974)

(cited by Bratton and Gold, 2003, p194)

the process for identifying an organisations

current and future human resource requirements,developing and implementing plans to meet theserequirements and monitoring their overalleffectiveness

(Beardwell and Claydon, 2007, p159)


5/38

Objectives of human resource planning

Forecast personnel requirements

Cope with changes

Use existing manpower productively

Promote employees in a systematic way

Importance of human resource planning

Create a talent pool

Prepare people for future

Cope with organizational changes

Cut costs

Help succession planning


6/38

EFFECTIVE HR PLANNING

Effective HR Planning ensures that:

the available talent is correctly allocated

labour costs are controlled

employee numbers are appropriate

productivity is improved

talented employees are retained


7/38

ORGANISATIONAL STRATEGYAND HRP


8/38

3 Cs of HRD

Commitment

Tasks may

not be done

at all or done

at a slow

pace that

they loserelevance Culture

This is the

sustaining force

and spirit for the

organization to live

All 3 Cs are needed for the organization to succeed.

Competencies

Tasks to be

completed cost

effectively, with

optimal efficiency


9/38

The HR Planning Process

The four phases or stages of HRplanning:

Situation analysis orenvironmental scanning

Forecasting demand

Analysis of the supply

Development of action plans


10/38

Technological forecastsEconomic forecasts

Market forecastsOrganizational PlanningAnnual operating plans

Annual EmploymentRequirementsNumbers

SkillsOccupationcategories

Existing employmentInventory afterapplication of

Expected lossAnd attrition rate

Strategic Planning H R Demand HR Supply

Compared

with

Variances

If surplus

EndEnd

If shortage

End

DecisionsOvertime

Recruitment

DecisionsLayoffs

Retirements

Ifnone

Human Resource Planning Process


11/38

Situation Analysis & Environmental

Scanning

The first stage of HR planning is the point at which HRM andstrategic planning first interact

The strategic plan must adapt to environmentalcircumstances

HRM is one of the primary mechanisms an organizationcan use during the adaptation process

Without a plan to support recruitment and selection, it isimpossible to stay competitive

The problems associated with changing environments aregreater today than ever before

Success now depends on being a global scanner


12/38

Forecasting Demand for Employees

This phase of the process involves estimating: How manyemployees will be needed

What kindsof employees will be needed

Quantitative tools can help with forecasting, but it involves a

great deal of human judgment The demand for employees is closely tied to the strategic

direction that the organization has chosen

Growth

Reengineering Reorganization


13/38

Forecasting Demand for Employees

Techniques to help reduce the uncertaintyinherent in HR planning:

Expert estimates

Trend projections

Statistical modeling

Unit-demand forecasting

Key to effective planning is accurately and

freely sharing information


14/38

The Expert Estimate

One or more experts provide the organization with demand

estimates based on:

Experience

Guesses

Intuition

Subjective assessments ofavailable economic andlabor force indicators

This is the least mathematically sophisticated

approach


15/38

The Expert Estimate

The Delphi technique elicits expert estimates from a

number of individuals in an iterative manner

Developed by the Rand Corporation

Estimates are revised by each individual based onknowledge of the other individuals estimates

With the nominal group technique (NGT), individualestimates are followed by group brainstorming

The goal is to generate a group decision that is preferredover any individual decision


16/38

Trend Projection

This top-down technique:

Develops a forecast based on a

past relationship between a factor

related to employment andemployment itself

Example: Sales levels are relatedto employment needs


17/38

Modeling & Multiple-Predictive Techniques

This top-down approach uses the mostsophisticated forecasting and modelingtechniques

Trend projections relate a single factor, such as

sales, to employment Environmental factors could be gross national

product or discretionary income

Or, the organization may be mathematically

modeled so that simulations can be run


18/38

Modeling & Multiple-Predictive Techniques

Markov chain analysis involves:

Developing a matrix to show the probability of anemployees moving from one position to another

or leaving the organization

The process begins with an analysis of staffinglevels from one period to another

Markov analysis can identify the probability oflower employee retention

It does not suggest a solution to the problem


19/38

Modeling & Multiple-PredictiveTechniques

Regression analysis is a mathematicalprocedure:

It predicts the dependent variableon the basis offactors (independent variables)

With simple linear regression, one dependent andone independent variable are studied

With multiple regression, more than oneindependent variable is studied


20/38

Unit Demand Forecasting

This is a bottom-up approach

Unit managers analyze current and

future needs person-by-personand job-by-job

Headquarters totals the unit forecasts

The sum is the corporate employment forecast

If both bottom-up and top-down approaches are used,the forecasts may conflict

This can be resolved by averaging the variances

The Delphi technique or NGT could also be used


21/38

Analyzing the Current Supply of Employees

This phase of HR planning should answer thequestion:

How many and what kinds of employees do I

currently have, in terms of the skills and trainingnecessary for the future?

This involves more than simply counting currentemployees

The smaller and more centralized the

organization, the easier it is to conduct a skillsinventory


22/38

Important barometers of labour supply1. Net migration into and out of the area

2. Education levels of workforce

3. Demographic changes in population

4. Technological developments and shifts

5. Population Mobility

6. Demand for specific skills

7. National, regional unemployment rates

8. Actions of competing employers

9. Government policies, regulations, pressures

10. Economic Forecasts for the next few years

11. The attractiveness of an area

12. The attractiveness of an industry in a particular place


23/38

The Skills Inventory

Both a skills inventory and a managementinventory:

Identify the skills, abilities, experiences, andtraining employees currently have

Are useful for career planning, managementdevelopment, and related activities

In its simplest form, a skills inventory is a list of:

Names

Characteristics

Skills


24/38

Contents of the Skills Inventory

The only data available to the organization for

later use is what was designed into the system

Name Employee number

Present location Date of birth

Date of employment Job classification

Skills, knowledge, education Foreign language skill

Professional qualifications Publications

Licenses and patents Hobbies

Supervisory evaluations Salary range


25/38

Maintaining the Skills Inventory

The two principal methods for gatheringdata:the interview and the questionnaire The questionnaire is faster and cheaper, but can be

inaccurate

Some contend that a trained interviewer can completequestionnaires more quickly and accurately

Plans for keeping files updated must bemade

The more often changes are made and the data is used, themore often updates should be performed


26/38

Action Decisions in HR Planning

After the supply of and demand for workers has beenanalyzed, the two forecasts must be compared

Whenever there is a gap between the two estimates, acourse of action must be chosen

If the supply of workers is less than the demand:

It can be filled with present employees who are willing towork overtime

If there is a shortage of skilled employees:

Train and/or promote present employees

Recruit less-skilled employees

Recall employees who were previously laid off


27/38


Organizations are using more: Part-time workers

Subcontractors

Independent professionals

This is in response to: Intense global competition

Rapid technological change Fears caused by recent workforce reductions

Over 5 million U.S. citizens are contingentworkers


28/38


Possible solutions to an employee surplus:

Attrition

Early retirements

Demotions

Layoffs Terminations

Employees who are considered surplus are

seldom responsible for the conditions leading tothe surplus


29/38


Most organizations avoid layoffs by usingattrition, early retirement, creation of work,and so on Attrition can be accelerated by encouraging employees to leave

early

Drawbacks to losing workers over the age of50: They tend to be healthier than younger workers They have fewer work-related injuries They are less likely to change jobs They take critical skills and experience with them


30/38


In coming years

Over half the workforce will beprotected by the Age Discrimination

in Employment Act

Promises should not be made that cant bekept

Once promised, it may be illegal to change them

A i D i i i HR Pl i


31/38



32/38


If voluntary reductions dont eliminate thegap between supply and demand, layoffsmay be necessary Corporations too frequently and quickly turn to layoffs

They fail to consider the consequences

About one-third lay off too many workers

Poorly designed workforce reductions can kill morale


33/38

Human Resource Information Systems

Information is the key to successful HRplanning A human resource information system (HRIS) is an

integrated way to acquire, store, analyze,and controlinformation flow through an organization

A highly developed HRIS can increase theefficiency and response times of:

Tracking applicants Skills inventory

Career planning

Employee service programs


34/38


Computer technology makes it possible tointegrate multiple HR needs into a singlesystem:

Enrolling in benefits programs

Processing employee transactions (pay increases)

Using learning modules

An HRIS developed for use by upper-levelexecutives is called an executiveinformation system (EISs)

Computerized HRISs have allowed organizations to broaden

their view of succession planning


35/38


Factors that make succession planning forexecutive level positions more importantthan ever: Large numbers of aging executives

Increasingly popular early retirement

Fortune 500 companies anticipate 33 percent turnover amongtheir executives over the next five years

Many companies now realize the criticalneed fora comprehensive retention plan

This plan may include consulting and part-time assignments


36/38

Formulating HR Plans

Once supply and demand for labour is known adjustments can be

made formulating requisite HR plans

A variety of HR plans

Recruitment plan

Redeployment plan

Redundancy plan

Training plan

Productivity plan

Retention plan


37/38

Effective Human Resource Planning

HR plans must fit in with overall objectives of a firm. They

must get consistent support from top management.

Computerized human resource information systems must

be used for applicant tracking, succession planning,

building skills inventories etc. The whole exercise must be

carried out in coordination with operating managers.


38/38

Thank You

Questions Please???

Hrm-human Resource Planning 3

Documents

Transcript of Hrm-human Resource Planning 3