Hrm-human Resource Planning
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Transcript of Hrm-human Resource Planning
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HUMAN RESOURCEPLANNING
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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
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Introduction
The types of people employed and thetasks they perform determine the kind of
planning 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 an
organizations overall strategy
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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 these
requirements and monitoring their overall
effectiveness
(Beardwell and Claydon, 2007, p159)
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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
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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
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ORGANISATIONAL STRATEGY
AND HRP
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The HR Planning Process
The four phases or stages of HRplanning:
Situation analysis or
environmental scanning
Forecasting demand
Analysis of the supply
Development of action plans
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Technological forecasts
Economic forecasts
Market forecastsOrganizational Planning
Annual operating plans
Annual Employment
Requirements
Numbers
SkillsOccupation
categories
Existing employment
Inventory after
application of
Expected lossAnd attrition rate
Strategic Planning H R Demand HR Supply
Compared
with
Variances
If surplus
EndEnd
If shortage
End
Decisions
Overtime
Recruitment
Decisions
Layoffs
Retirements
Ifnone
Human Resource Planning Process
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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 environmental
circumstances
HRM is one of the primary mechanisms an organizationcan use during the adaptation process
Without a plan to support recruitment and selection, it is
impossible to stay competitive
The problems associated with changing environments are
greater today than ever before
Success now depends on being a global scanner
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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
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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
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The Expert Estimate
One or more experts provide the organization with demand
estimates based on:
Experience
Guesses
Intuition
Subjective assessments ofavailable economic and
labor force indicators
This is the least mathematically sophisticated
approach
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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 on
knowledge of the other individuals estimates
With the nominal group technique (NGT), individual
estimates are followed by group brainstorming
The goal is to generate a group decision that is preferred
over any individual decision
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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 related
to employment needs
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Modeling & Multiple-Predictive Techniques
This top-down approach uses the most
sophisticated forecasting and modeling
techniques
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
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Modeling & Multiple-Predictive Techniques
Markov chain analysis involves:
Developing a matrix to show the probability of an
employees 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 of
lower employee retention
It does not suggest a solution to the problem
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Modeling & Multiple-Predictive
Techniques Regression analysis is a mathematical
procedure:
It predicts the dependent variableon the basis of
factors (independent variables)
With simple l inear regression, one dependent andone independent variable are studied
With multiple regression, more than one
independent variable is studied
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Unit Demand Forecasting
This is a bottom-up approach
Unit managers analyze current and
future needs person-by-person
and 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
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Analyzing the Current Supply of Employees
This phase of HR planning should answer the
question:
How many and what kinds of employees do I
currently have, in terms of the skills and training
necessary for the future?
This involves more than simply counting current
employees
The smaller and more centralized the
organization, the easier it is to conduct a skillsinventory
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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
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The Skills Inventory
Both a skills inventory and a management
inventory:
Identify the skills, abilities, experiences, and
training 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
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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
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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, a
course 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
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Action Decisions in HR Planning
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
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Action Decisions in HR Planning
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Formulating HR Plans
Once supply and demand for labour is known adjustments can bemade formulating requisite HR plans
A variety of HR plans
Recruitment plan Redeployment plan
Redundancy plan
Training plan
Productivity plan
Retention plan
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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.