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HUMAN RESOURCE PLANNING INTRODUCTION Human resource is considered as the most valuable, yet the most volatile and potentially unpredictable resource, which an organisation utilizes (Doherty, 1994). If an organisation fails to place and direct human resources in the right areas of the business at the right time and at the right cost serious inefficiencies are likely to arise creating considerable operational difficulties and likely business failure (Bramhan, 1990, Smith, 1971). With an increasingly competitive environment, projected labour shortages in highly skilled and surpluses in unskilled category, changing demographics and increased pressure on government to protect employee rights, human resource planning is becoming a challenging task for the organisations. Now-a-days it has been increasingly acknowledged that human resource is a decision taking source. Even more importantly, human resource is pre-eminently an income-generating resource and must be treated as the greatest asset of the organisation. Human Resource Planning (HRP) therefore assumes a significant role in the future success or failure of an organisation. Human resource may be regarded as the quantitative and qualitative measurement of work force required in an organization and planning in relation to human resource may be regarded as establishing objectives to develop human resources in line with broad objectives of the organization. In the present scenario when we all confine our attention to downsizing or rightsizing of human resource to address the problem of an organization, HRP, per se, has assumed more importance. While employment practices differ from country to country, we find experience of industrially advanced nations also, by and, large converge on issues on HRP. Almost everyday newspapers and business magazines carry news items on Voluntary Retirement Scheme (VRS), job-cuts, downsizing or rightsizing, early retirement, retrenchment and human resource planning. And this is not limited to only those organizations that are operating on a smaller scale, even globally visible multinationals are also in the fray. Thus HRP issues are globally relevant, although their magnitude may differ from country to country at macro level and organization to organization at micro level. There are obvious benefits to a society, which can arrange for its people to be employed, in ways, which are socially profitable and personally rewarding. The importance of HRP can be over-emphasized. Human resource is one of the most critical & difficult resources to plan for several reasons. First, of all human resource have a far-reaching impact on the profitability of the enterprise. It has been frequently stated, and frequently ignored that a companys success or failure depends more in the effectiveness of its personnel than on any other single factor. HRP provides a strategic basis for taking human resource decisions, and anticipating change. It is not merely concerned with human resource demographics, turnover projections, succession planning, etc. Therefore, HRP helps to plan replacements and changes in competencies of human resource in a systematic manner. Of late HRP has become an important enterprise and wide strategic function not only to achieve goals and objectives but also to sustain the present level in organizations. NEED FOR PLANNING The need for planning arises mostly due to the fact that modern organisations have to survive, operate and grow in highly competitive market economics where change is the order of the day. The change may be
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either revolutionary (sudden) or evolutionary (slow). The different areas of change include: change in technology, change in population, change in economic structures and systems, change in policies of government, change in employee attitudes behaviour. etc. These changes create problems for the management through threats and challenges. Managers have to bear the problems caused due to the changes and act upon them tactfully in order to avoid or reduce the effects of these problems on the survival, operation and growth of the organisation. Efficient managers can foresee the problems likely to occur and try to prevent them. As pointed by Terry, successful managers deal with foreseen problems and unsuccessful managers struggle with unforeseen problems. The difference lies in planning. Managers have to foresee to make the future favourable to the organisation in order to achieve the goals effectively. They introduce action, overcome current problems, prevent future uncertainties, adjust the goals with the unforeseen environmental conditions and exert all their resources to achieve their goals. According to Megginson, et al to have an organisation that looks forward to the future and tries to stay alive and prosper in a changing world, there must be active, vigorous, continuous and creative planning. Thus, there is a greater need for planning in order to keep the organisation dynamic in a changing situation of uncertainty. More specifically, HRP is required to meet following objectives: 1. Forecast HR requirement. 2. Cope-up with the change in market conditions, technologies, products, government regulations and policies, etc. 3. Use existing HR productivity. 4. Promote employees in a systematic manner. If used properly, it offers a number of benefits: 1. Create reservoir of talent. 2. Prepares people for future. 3. Expand or contract. 4. Cut cost. 5. Succession planning. EXAMINING EXTERNAL AND INTERNAL ISSUES External and internal issues are the forces that drive human resource planning. An issue is any event or trend that has the potential to affect human resource outcomes, such as employee motivation, turnover, absenteeism, the number and types of employees needed and so forth. External issues are events or trends outside of the organisation, such as work force demographics and technology. Internal issues refer to events or trends within the organisation, such as business strategy, organizations structure and company profitability. Work Force Demographics: Potentially important external issue is the composition of the national workforce. Specifically, there are likely to be changes in the social, gender and age composition of the workforce. Asians will
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comprise a large percentage of the workforce in the future. Women are also expected to comprise a large segment of the workforce than in the past. The number of married women who are employed has doubled since 1970. The increased participation of women will have a pressure on organisations to provide pro-family policies, such as flexi time, and child care to support working mothers. Increased representation of minorities will result in more emphasis on diversity programmes to ensure harmonious relations between workers from different racial and ethnic groups. Technology: Organisation are investing so much amount on information technology during the 1980s. Given the size of the investment, a variety of changes in the human resource area have occured. Human resource requirements have come down drastically due to technological changes. There are many organisations who have announced plans to reduce its workforce around 50 per cent employees as a result of technological changes. Now that you have read about some of the external issues that affect human resource planning, you will learn about some important internal issues. Organisational Structure: Many businesses today are changing their organisational structure. Organisational structure refers to how work tasks are assigned, who reports to whom, how communications and decisions are made? As part of their restructuring during some companies are creating teams to perform the work. Business Strategy: The approach that a company adopts in conducting business is referred to as its business strategy. For example, a particular compnay may adopt strategy on quality enhancement, cost reduction and so on and so forth. It is important for organisations to monitor both the internal and external environment to anticipate and understand the issues that will affect human resources in the future. DETERMINING FUTURE ORGANISATIONAL CAPABILITIES The second step of the human resource planning process involves an analysis of future organisational or personal capabilities. Capabilities include the skill level of employees, productivity rates and number of employees, etc. In the past, more emphasis was on predicting the number of employees of human resource supply the company was likely to have in the future. Organisations may use varieties of procedures to estimate the supply. These procedures are generally categories as either quantitative which use mathematical or statistical procedures or qualitative which use subjective judgement approaches. The quantitative procedure generally use past information about job categories and the number of people retiring, being terminated, leaving the organisation voluntarily and being promoted. One of the most well known quantitative procedures is the Markov analysis. This technique uses historical rates of promotion, transfer and turnover to estimate future availabilities in the workforce. Based on the past abilities, one can estimate the number of employees who will be in various positions within the organisation in the future. Qualitative or judgemental approaches are much more popular in forecasting human resource supplies. Among the most frequent used methods are replacement planning, succession planning and vacancy analysis. Replacement planning evolves an assessment of potential candidates to replace existing executives and other top level managers as they retire or leave for other organisations. Succession planning is similar to
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replacement planning, except that it is more long term and developmentally oriented. Finally, vacancy analysis is much like the Markov analysis, except that it is based on managerial judgements of the probabilities. If knowledgeable experts provide estimates, vacancy analysis may be quite accurate. In recent years, organisations have become concerned with a broader range of issues of future capabilities. For example, organisations have begun to estimate their future productivity levels. Towards this end, bench marking is a technique that has become popular. Bench marking involves comprising an organisations human resource practices and programmes to other organisations. Although bench marking often focuses on an organisations competitors, best practices bench marking focuses on the programmes and policies used by outstanding organisation. For example, Federal express, leadership evaluation system, employee survey programme and total quality management efforts are frequently studied by other organisations because of their reputations. DETERMINING FUTURE ORGANISATIONAL NEEDS In this step, the organisation must determine what is human resource needs will be in the future. This includes the number of employees that will be needed, the types of skills that will be required. Productivity rates needed to complete successfully. There are methods for examining the future number of employees, also several procedures are there for predicting the number of employees needed in the future. This is referred to as the human resource demand two basic approaches or estimating human resource demand are qualitative and quantitative methods. Two quantitative techniques for estimating human resource demand are ratio analysis and regression analysis. Ratio analysis involves comparing the number of employees to some index of work load. If your organisation was planning its future training and development (T&D) staffing demand in five years, you could estimate the number of employees likely to be employed by the company in five years. And then use this ratio to determine the number of T&D employees needed in given years. For example, if your company was expecting to have 5,000 employees in five years, this ratio would suggest that around 21 T&D employees would be needed. Regression analysis relies on factors or predictors that determine the demand for employees, such as revenues, degree of automation, and so forth. Information on these predictors from past years, as well as the number of workers employees in each of these years is used to produce an equation or formula. The organisation can then enter expected figures for the predictors, such as revenues and degree of automation into the formula to obtain an estimated number of employees needed in future years. Regression analysis is more sophisticated than ratio analysis and should lead to more accurate predictions of employee demand. Although both procedures are widely used, they have their weaknesses. A major weakness is the factors that were related to workforce size may not be relevant factors in future years. Turning now to qualitative tools for estimating the demand for employees, the most common tool is the bottom-up forecast where department managers make estimates of future human resource demands based on issues, such as new positions needed, positions to be eliminated or not filled, expected overtime hours to be worked by temporary, part-time or independent contractor employees and expected changes in workload by

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department. Like any other technique, bottom-up forecasting has its shortcomings. For instance, line managers may overestimate the demand in order to ensure that they dont find themselves understaffed. TYPES OF PLANS There are nine types of plans, such as, philosophy, purpose, objectives, strategies, policies, procedures and rules, programmes and budgets. Now we shall discuss in brief each of these types of plans. 1. Philosophy: The organisations role that they wish to play in society in terms of philosophy. The philosophy of the company should have clarity of thought and action in the accomplishment of economic objectives of a country. The philosophy bridges the gap between society and the company. 2. Purpose: Every kind of organized group activities or operations has a purpose. For example, the purpose of a bank is to accept deposits and grant loans and advances. 3. Objectives: Objectives are the ends towards which organisational activity is aimed. Every department has its own objectives which may not be completely same as of the other department or organisation. 4. Strategies: Strategy is determination of the basic long term objectives of an enterprise and the adoption of courses of action and allocation of resources necessary to achieve these goals. 5. Policies: Policies are general statements or understandings which guide or direct thinking and action in decision making. However, all policies are not statements. 6. Procedure and Rules: Procedures are plans that establish a desired method of handling future activities. They detail the exact manner in which a certain activity must be accomplished. 7. Programmes: These are complexes of goals, policies, procedures, task assigment rules, steps to be taken, or sources to be employed and other elements necessary to carry out a given course of action. 8. Budget: A budget is a statement of expected results in terms of members. It may be referred to as a numerical programme. Cash budget, sales budget, capital expenditure budget are some of the examples of budget. DEFINING HRP Human resources are considered as the most valuable and important as they can become the counter productive liability in comparison to other material resources which at best can become Non performing asset. Human resource planning is mainly concerned with crystallizing from where the right type of people in right number can be secured for future anticipated vacancies. Human resource planning attempts to recruit, retain and efficiently distribute and channel employees both laterally and hierarchically through an organization. By maintaining control over the quantitative and qualitative flows and stocks of manpower the organisation functions smoothly by having the right human resource at the right place, at the right time and cost. Human resource is a primary resource without which other resources, physical and financial, cannot be put into use. Even a fully automatic unit requires human resource to run it and also to plan for further improvement.
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To achieve any goal, human resource requirement needs to be assessed, located and harnessed. HRP is not a mere assessment of the number of men required. An organization has to categorize men as per their knowledge and skills and also ensure their balanced allocation. Improper human resource planning may lead to overstaffing increasing direct cost (viz., salary), cost of training, amenities, apart from the cost of production. Under staffing also affects production, morale and productivity. Optimum human resource planning, therefore, aims at balancing demand, supply, distribution and allocation of human resource, controlling cost of human resources, formulating policies on transfer, succession, and relocation of human resource. As De Paula puts it: A company is merely a dusty legal framework. All its assets, open or hidden, are mostly inanimate, even intangible objects. Only people can breathe life into business and bring about the profitable exploration of the firms assets. (Paula, 1967). The national accounts show that for all firms taken together as annual expense human resource is more than twice as great as capital investment. Even in a capital-intensive company (e.g. a petroleum company) human resource expense to annual capital expenditure can be expected to be in the ratio 2:3. Human resource planning means different things to different organizations. To some companies, human resource planning means management development. It involves helping executives to make better decisions, communicate more effectively, and know more about the firm. The purpose is qualitative to make men and women better managers. The emphasis is on having current managers who are skilled in their function and reasonably qualified for promotions. Too frequently the acquisition and development of the skills and knowledge needed for the future are lacking. The goal is often only to make the manager- a better manager today. In other firms, the approach to human resource planning is reversed. Here the problem is defined as estimating future human resource needs. The goal is to hire persons today to meet future requirements. The qualitative aspect of development is somehow to be met by a natural development process, even though future knowledge and skill requirements are ignored in the planning efforts. The guiding principle is to ensure that enough bodies are available when needed. This quantitative approach is supported by a belief that the organization has never suffered because people were not capable, that human resource hardships can only result from a numerical human resources shortage. Unfortunately, this type of thinking may exist because the organization does not evaluate the quality of its human resource carefully. The purpose of Human resource planning is to ensure that policies for each activity link together so that ideally no one offends the direction of another; indeed, each should help the achievements of the others so that the business and ethical objectives of the firm can be met (Bramham, 1990). HRP attempts a more strategic planning of employees within the organization and states that human resuorce department should be an integral part and member of the business strategy-making body (Doherty, 1994). It attempts more radically to address the potential and developmental needs of employees in order to foster quality commitment and productivity in the workforce (Doherty, 1994). HRP reconciles the individual and organizational goals. HRP is a process by which management determines how the organization should move from the current manpower position to its desired manpower position. Through planning, management strives to have the right

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number and the right kinds of people, at the right places, at the right time, doing things, which result in both organization and the individual receiving maximum long run benefit. (Vetter, 1967)

HRP has been defined as a strategy for the acquisition, utilization, improvement, presentation and preservation of an enterprises human resources for achieving maximum long term benefits. HRP aims at maintaining and improving organisations objectives by making the workforce committed and satisfying the individual employees needs and societal goals. It is that activity of the management which is aimed at coordinating the requirements for and the availability of different types of employees. This involves ensuring that the firm has enough of the right kind of people at the right time and also adjusting the requirements to the available supply for achieving corporate objectives, through the development of strategies designed to enhance the contribution of human resources at all times in the foreseeable future. HRP is a component of corporate plan. The HRP assesses the corporate mission or objective before proceeding for preparation of human resource plan. Preparation of such a plan inevitably involves anticipating, inventorying, forecasting and programming future human resource requirement needs and arranging for an orderly procedure to meet these needs as and when they arise. Human Resource Planning System (HRPS) aims at better utilization of human resource existing in an organization. By identifying the deficiencies in each individual through analysis of human resource Inventory, it helps in identification of training need of an individual. By studying the job and the efficiency of the jobholder it not only helps in devising most ideal work practices but also helps in role clarity. Thus, without proper planning of human resource there is no development. HRP is the starting point of Human Resource Development System (HRDS). So concluding we can find that it is the process of forecasting, developing, controlling; by which a firm ensures that it has the right number of people and right kind of people at the right places at the right time doing the work for which they are economically most useful. It can also be expressed as the process by which an organization should move from its current manpower position to its desired man power position through planning. HRP may be viewed as foreseeing the HR requirements of an organization & the future supply of HR & Human resource or manpower is a primary resource without which other resources, physical and financial, cannot be put into use. Even a fully automatic unit requires manpower to run it and also to plan for further improvement. To achieve any goal, manpower requirement needs to be assessed, located and harnessed. HRP is not mere assessment of the number of men required. An organization has to categorize men as per their knowledge and skills and also ensure their balanced allocation. Improper manpower planning may lead to overstaffing increasing direct cost (viz., salary), cost of training, amenities, apart from the cost of production. Under-staffing also affects production, morale and productivity. Optimum manpower planning, therefore, aims at: Balancing demand, supply, distribution and allocation of manpower, Controlling cost of human resources, Formulating policies on transfer, succession, relocation of manpower.
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Making necessary adjustments between these two & organizational plans. Foreseeing the possibility of developing the supply of HR in order to match it with requirements by introducing necessary changes in the function of HRM.

OBJECTIVES OF HRP HRP functions as a planning and controlling technique. It enables a manager to predict the manpower requirement of the organization as well as control the number of employees deployed. It helps in optimum utilization of human resources. It controls wage and salary costs. It accurately estimates the number of employees required with appropriate skill and experience. It enables the organisation to undertake a manpower audit by which the shortages or surpluses in manpower are identified. It helps in creating and maintaining an exhaustive inventory of existing human resources. It identifies the numbers to be recruited by forecasting the future requirement, matching that with the internal supply and knowing the gap and converting it into optimum recruitment levels thereby avoiding unexpected shortages. It also identifies the optimum training level of all employees of the organisation by identifying their training needs as a result of which shortages in skills can be avoided. The purpose of human resource planning is to ensure that policies for each activity link together so that ideally no one offends the direction of another; indeed each should help the achievement of the others so that the business and ethical objectives of the firm can be met (Bramham, 1990) Human Resource Planning attempts a more strategic planning of employees within the organisation and states that Human Resource department should be an integral part and member of the business strategy-making body (Doherty, 1994). It attempts more radically to address the potential and developmental needs of employees in order to foster quality, commitment and productivity in the workforce (Doherty, 1994). HRP reconciles the individual employees goals with organisational goals. Human resource planning involves forecasting, inventorying, anticipating and planning. Forecasting future manpower requirement either is terms of mathematical projections of trends in the economy and developments in the industry or of judgmental estimates based upon specific future plans of the organisation. Inventorying involves stock taking of present manpower resources and analyzing the degree to which these resources are employed optimally. Anticipating helps is foreseeing manpower problems by projecting present resources into the future and comparing them with the forecast of requirements to determine their adequacy both quantitatively and qualitatively. Finally the activity of planning helps in designing the necessary programmes of recruitment, selection, training and development, performance management, career management, motivation, compensation and management of separations so that future manpower requirements will be well met. The objectives of human resource planning are mainly to: 1. Integrate planning and control of human resource with organizational planning. 2. Ensure optimum use of human resource currently employed. 3. Avoid imbalances in distribution or allocation of human resources. 4. Forecast long-term manpower requirement. 5. Improve the efficiency and productivity. 6. Link HRP with organisational planning. 7. Coordinate human resource policies of the organization.
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8. Provide control measure to ensure that necessary resources are available as and when required. 9. Minimize overstaffing and understaffing. 10. Anticipate redundancies and avoid unnecessary dismissals. 11. Determine optimum recruitment levels, there by avoiding unexpected 12. Determine optimum training levels to avoid skill shortages. 13. Provide a basis for management development programmes. 14. Assess future accommodation requirements. 15. Achieve efficiency of work in all spheres of the corporate body. 16. Ensure cost minimization. 17. Eliminate all types of wastages including wastages of time. 18. Maintain required level of skill, experience & competency, matching present & future needs of the organization. 19. Control wage & salary costs. 20. Assist in productivity bargaining. 21. Enable the organization to undertake a human resource audit by which the shortage or surpluses in human resource are identified. 22. Fore see the employee turnover & make the arrangements for minimizing turnover & filling up of consequent vacancies. 23. Meet the needs of the programmes of expansion, diversification etc. 24. To fore see the impact of technology on work, existing employees & future human resource requirements. 25. Maintain congenial industrial relation by maintaining optimum level and structure of human resources. 26. Formulate transfer & promotion policies. Human resource planning involves forecasting, inventorying in vectoring, anticipating and planning. Forecasting future manpower requirement either in terms of mathematical projections of trends in the economy and developments in the industry or of judgmental estimates based upon specific future plans of the organisations. Inventorying involves stock taking of present manpower resources and analyzing the degree to which these resources are employed optimally. Anticipating helps is foreseeing manpower problems by projecting present resources into the future and comparing them with the forecast of requirements to determine their adequacy, both quantitatively and qualitatively. Finally the activity of planning helps in designing the necessary programmes of recruitment, selection, training and development, performance management, career management, motivation, compensation and management of separations so that future manpower requirements will be well met.
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IMPORTANCE OF HRP / WHY CURRENT INTERESTS? Various factors have contributed to the greater interest and concern for human resource planning in the modern context. Some of them are briefly summarized here. 1. The Growing Occupational Structure of the labour force in industrialized economies has shifted to meet changes in jobs. Occupations requiring the least skill and educational preparation show smaller growth and those that require more preparation are growing faster. This emphasizes the need for proper forecasting of future demand and sources of supply of different types of human resource. 2. Employment Unemployment Situation: Though in general the number of educated unemployed is on the rise there is an acute shortage for a variety of skills. This emphasizes the need for more effective recruitment and retraining people. 3. The Rising Job Requirements, within existing occupations make re-training a must for many current jobholders. This emphasizes continued retraining which makes alternative periods of work and refresher education a frequent pattern. 4. The Skill Shortages in less developed countries are a major hindrance in their progress towards industrialization. Though in general the number of educated un-employed is on the rise there is acute shortage for a variety of skills. This emphasizes the need for more effective recruitment and retraining people. Organizations have generally become more complex and require a wide range of specialist skills that are rare. Problems arise when such employees leave. 5. Technological Changes: The myriad changes in production technologies, marketing methods and management techniques have been extensive and rapid. This effect has been profound on job contents and job contexts. These changes cause problems relating redundancies, retraining and redeployment. All these suggest the need to plan human resource needs intensively and systematically. 6. Organizational Change: In the turbulent environment marked by cyclical fluctuations and discontinuities, the nature and pace of changes in organizational environment activities and structures affect human resource requirements and require strategic considerations. 7. Demographic Changes: The changing profile of the work force in terms of age, sex, literacy, technical inputs and social background have implications for human resource planning. 8. Governmental Influence: Government control and changes in legislation with regard to alternative action for disadvantaged groups. Working conditions and hours of work, restriction on women and child employment, casual and contract labour etc. have stimulated the organizations to become involved in systematic human resource planning. 9. Legislative Control: The days of executive flat and hire and fire policies are gone. Now legislation makes it difficult to reduce the size of an organization quickly and cheaply. It is easy to increase but difficult to shed the fat in terms of the numbers employed because of recent changes in labour law relating to layoff and closures. Those responsible for managing human resource must look ahead and thus attempt to foresee human resource problems.
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10. Impact of Pressure Groups: Pressure groups such as unions, politicians and persons displaced from land by location of giant enterprises have been raising contradictory pressures on enterprise management such as internal recruitment, and promotions, preference to employees children, displaced persons, sons of the soil etc. 11. Changes In Mobility: Increased mobility of human resource has worked both to assist organizations and nations in meeting new job requirements and to complicate managers efforts to retain qualified employees by putting emphasis on human resource planning. 12. Systems Concept: The spread of system thinkers and the advent of the micro-computer as part of the on-going revolution in information technology which emphasizes planning and newer ways of handling voluminous personnel records. 13. Lead Time: The long lead-time is necessary in the selection process and for training and development of the employees to handle new knowledge and skills successfully. Finally the growing interest in the total process of management planning has stimulated attention to the need for human resource planning. USES OF HUMAN RESOURCE PLANNING Human resource planning is practically useful at different levels such as: National Level: It is generally done by the Government and covers items like population projections, programmes of economic development, educational facilities occupational distribution and growth, industrial and geographical mobility of personnel. As per example the mass literary adult literary programmes, the childrens vaccination programme, setting up of school and colleges in the block level depending on the number of population in those areas, Midday lunch to poor school children in rural and tribal areas are some of the HRP programme at the National level. Subsidies to farmers and entrepreneurs in the backward areas are some of the sectoral level HRPs. It may be done by Central or State Government and may cover human resource needs of agricultural, industrial and service sectors. Industry Level: It may cover human resource forecast for specific industries, such as engineering, heavy industries, consumer goods industries, public utility industries etc. Individual Unit Level: It may relate to the human resource needs of each individual organization for various departments and for various types of personnel. Planning the manpower requirement of RIL or NALCO for the future time period is an example of HRP at an individual unit level. TYPES OF HR PLAN Short range 1. It occurs normally for 0-2 yrs. 2. It is done when expansion occurs due to technological change or because of employee turnover. 3. Supply of labour in this case can be done through departments, divisions or through promotions internally.
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4. Externally labour supply can be done according to the area, employment levels etc. Intermediate Range 1. This short of planning is normally done for a period of 2-5 yrs. 2. It is done when there is need from budgets or plans or because of expansion or contraction. 3. Internal supply of labour is done through merger or acquisition. 4. External supply is done through labour market projection. Long range 1. It is a planning process, which is normally meant beyond 5yrs. 2. It is done when there is a change in the environment and technology. 3. Essentially it is judgmental. 4. Internal labour supply depends upon management expectations of employees and future available manpower. 5. External supply in this case depends upon future conditions affecting man power requirement. ACTIVITIES REQUIRED FOR HRP/MANPOWER PLANNING Manpower planning consists of a series of activities, which can be listed as follows: Forecasting future manpower requirements: This is done either in terms of mathematical projections or in terms of judgemental estimates. Mathematical projections are done depending on the specific future plans of a company by managerial discretion, which is based on past experience. Preparing an inventory of present manpower: Such inventory contains data about each employee's skills, abilities, work preferences and other items of information. Inventory of manpower resources helps in assessing the extent of deploying such resources optimally. Anticipating problems of manpower: This can be done by projecting present resources into the future and comparing the same with the forecast of manpower requirements. This helps in determining the quantitative and qualitative adequacy of manpower. Meeting manpower requirements: This can be achieved through planning, recruitment and selection, training and development, induction and placement, promotion and transfer, motivation and compensation to ensure that future manpower requirements are correctly met.

RESPONSIBILITIES OF THE HR DEPARTMENT HR Department, as an internal agency, plays a crucial role in manpower planning its responsibilities in regard to manpower planning may be summed up as follows: The first responsibility is to put pressure on the operating management to plan and establish objectives. HR Department at this stage is required assist and to give counsel to the operating management groups from time to time.
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It has to collect data in total organisation terms and to ensure that manpower planning is carried out, keeping pace with the long range objectives and the total business plan of the organisation. It has to measure and monitor performance against the plan and provide feedback to the top management. It has to carry out research for effective manpower and organisational planning.

ROLE OF HRP PROFESSIONALS HRP professionals have to perform the following roles that may be divided into three categories: 1. Administrative role o Managing the organisational resources Employees welfare activities. 2. Strategic role o Formulating HR strategies o Managing relationships with managers. 3. Specialized role o Collecting and analyzing data o Designing and applying forecasting systems o Managaing career development. BARRIERS TO HRP Planners face significant barriers while formulating an HRP. The major ones are following: 1. HR practitioners are perceived as experts in handling personnel matters, but are not experts in managing business. 2. People question the importance or making HR practices future oriented and the role assigned to HR practitioners in formulation of organisational strategies. There are people when needed offer handsome packages of benefits to them to quit when you find them in surplus. When the task is so simple, where is the need for elaborate and time consuming planning for human resources. 3. HR information often is incompatible with other information used in strategy formulation. Strategic planning efforts have long been oriented towards financial forecasting, often to the exclusion of other types of information. Financial forecasting takes precedence over HRP. 4. Conflict may exist between short term and long term HR needs. For example, there arises a conflict between the pressure to get the work done on time and long term needs, such as preparing people for assuming greater responsibilities. Many managers are of the belief that HR needs can be met immediately because skills are available on the market as long as wages and salaries are competitive. Therefore, long time plays are not required, short planning are only needed. 5. There is conflict between quantitative and qualitative approaches to HRP. Some people view HRP as a
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number game designed to track the flow of people across the department. 6. Non-involvement of operating managers renders HRP ineffective. HRP is not strictly an HR department function. Successful planning needs a co-ordinated effort on the part of operating managers and HR personnel. Dimension of HRP Dimensions of HRP can be discussed under the following two headings 1. Quantitative Population: It is the totality of human beings in a country. The definition of population can be categorized into de facto & de jure. De facto or present in area concept involves complete count of all persons; residents and non residents alike, physically present in the country at the time of enumeration. De Jure concept makes the complete count of all persons considered to be normal residents of the country irrespective of where each person is located, at the time of census. Population Policies: In terms of state it is the intervention in population planning. It is useful to distinguish between population-influencing policies & population-responsive policies. Population Structure: It is a dynamic concept. Structure of population at any point of time revels two things; first it is the result of interaction in the past among factors causing population growth. Secondly it revels the potential for future growth in population. Sex Composition: -The principle measure of sex composition is the sex ratio defined as the number of males per 100 females. In other words Sex ratio=Number of males in the population Number of females in the population Age composition: Age composition is the distribution of population by age groups-usually 5 yr age groups. Age composition at any given point of time is the result of past trends in fertility and mortality and also the basis for establishing future trends. Migration: Movement from one region to other is known as migration. Movements from regions within the country are known as out-migration & movement to other regions within the country is known as inmigration. This is called internal migration. Movements across national boundaries are known as international migration. Labour force Participation: Labour force or economically active population is that segment of population whose function is to produce goods and services demanded by the whole population. This includes employers, employees, self employed persons, those engaged in family enterprises without pay irrespective of man woman. *100

2. Qualitative Education & Training: It is the most dominant dimensions affecting the quality of human resources in terms of knowledge and skill. It serves both individual and social ends.
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Health & Nutrition: It is one of the most important indicator of quality of human resource. There are three determinants of health status o Purchasing power of people. o Public sanitation, climate & availability of medical facilities. o Peoples knowledge and understanding of health hygiene and nutrition.

Equality of opportunity: For the complete development there should be equality but it is affected by three discriminations o Social discrimination o Economic discrimination o Regional discrimination

APPROACHES TO HRP Approaches to HRP can be of 3 types 1. SOCIAL-DEMAND APPROACH It relies on an assessment of societys requirement for education It is an aggregate of individuals demand for education in respect of all individuals within the society. It relies on the past projection, projection depends upon the following things o Incomes of educated people o Tastes & preferences of house holds for education o Demographic features such as fertility & morality o Direct costs of education o Student grants o Existing standards of admission to various levels of education Social demand approach thus is capable of reveling the no of students within different types of professional preparation basing upon the past experience. Thus social demand approach suffers from the difficulty associated with any futurological exercise. 2. MANPOWER REQUIREMENT APPROACH In this approach an attempt is made to forecast future requirements of educated manpower to fulfill a future target of gross national product. The fundamental axiom of manpower requirement approach is that there is a definite link between education and economic growth. And lack of skilled personnels in required numbers reduces the growth. Basing upon the forecasts of educated manpower requirements over a specific period the planners would then indicate the directions of development of the educational sector over the same specific period. Steps Involved
Prof Amaresh C Nayak RCMA 15

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Anticipating the directions and magnitudes of development of each individual sectors of economy. Evolving norms for employing manpower in each individual sector. Translating the physical targets for the development into manpower requirements. Estimating the educational equivalents of the manpower requirement. Analyzing the implication of estimates of educated manpower requirements for educational development.

Limitations This approach assumes that educated manpower of different types are used in fixed proportion and that there are no substitution possibilities among the various categories. It postulates a definite link between an industrial task and an educational level.

3. RATE OF RETURN APPROACH RRA looks upon education as a contributor to productivity and in this sense it is expected to facilitate investment decisions. Three parameters are used to estimate the rate of return Cost of education It is again divided into two categories o Direct cost Private expenditure Public expenditure o Indirect cost

DIRECT COST Private Expenditure: -Private expenditure on education is the expenditure incurred by the individuals pursuing education, which includes items such as tuition fees, cost of books, extra room and board expenses and out of pocket expenses. It is relatively easier to estimate expenditure on these items. Public Expenditure: -Public expenditure on education is what the government spends on creating, expanding and maintaining educational facilities. Public expenditure may be divided into recurring and nonrecurring items of expenditure. Recurring expenditure consists of items such as salaries of teaching and non-teaching staff, maintenance expenditure, office expenditure including expenditure on students welfare. Non recurring expenditure comprises of cost of building, plant and equipment, library and sports complex.

INDIRECT COST There are no standard procedures in the estimation of social indirect costs. It may be viewed from both private and social angle. From private angle it is the earning forgone by individual students while attending school. From social view point indirect cost involves estimation of opportunity cost of public expenditure on education. There are no standard procedures in the estimation of social indirect costs. Returns to Education: It can be categorized into three types; Direct monetary benefits, Indirect monetary benefits, Non monetary benefits.
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Prof Amaresh C Nayak

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Direct Monetary Benefits-Direct monetary benefits to education are the extra lifetime earnings received that can be attributed to schooling. Earnings differential of any education programme say college education, can at best constitute a first approximation to the true earning. As per the experience increases so the income capability increases. But the base is from the prior education that a person has received. Indirect Monetary Benefits: Education influences earnings from the first job. Subsequently earning increases as experience grows but primarily it is dependant on the first education. For example an educated worker may improve production techniques and Office procedures which may improve the efficiency of all other workers and lead to an increase in the overall productivity. Indirect monetary benefits includes all the facilities that the family members of the workers receive such as Child care services during the period the child is at school the parents have free time to further their economic interests, and Generational transmission of education educated parents facilitate inherited aptitude for schooling among their children and effective home instruction, which saves expenditure on private tuition.

Non Monetary Benefit: These are the benefits that a person acquire because of educational awareness. It is qualitative in nature. Education alters and modifies tastes, preferences and outlook leading to cultural up gradation. Like wise education may facilitate individuals to take up more satisfying job with higher prestige and greater independence, and less of stress and strain. Many other non-monetary benefits of education are not captured by the educated individual rather they benefit the society. These benefits are categorized as externalities. The educated mind is trained to enquire and question, and not to accept any thing blindly. This aspect of education gives strength to the democratic principle. Education also causes quality improvement in labour.

Discount Rate: While the cost of education is incurred at the beginning, returns to education accrue over lifetime. In the computation of internal rate of return, which is a criterion for making investment decision on education, There is a need to discount future returns to arrive at their present value. Rate of return to education thus crucially depends upon the discount rate used for discounting future returns. In the case of private returns the discount rate could be o Either the rate of interest at which an individual borrows for financing education o Or the rate of return from the best possible alternative to invest in education. Limitations o It is only indicative of relative priorities. o It does not facilitate value judgment. o It is difficult to decide how much to invest on education.

Prof Amaresh C Nayak

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