HUMAN RESOURCE PLANNING

Throughout history it is the quality of the countrys manpower that has distinguished or disgraced it in the comity of nations. Anonymous

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Definitions
HRP is the process by which an org ensures that it has the right number and kind of people, at the right place, at the right time, capable of effectively and efficiently completing those tasks that will help the org achieve its overall obj. HRP translates the orgs objectives and plans of workers needed to meet those objectives. Without a clear-cut planning, estimation of an orgs human resource need is reduced to mere guess work.

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AIM OF HRP
Attract and retain people with appropriate skills, expertise and competencies Anticipate the problems of potential surpluses and deficits of people Develop a well trained and flexible work force Have an appropriate retention policy
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Potential benefits
Upper management better aware of the HR current configuration. Personnel cost is controlled. More time provided to locate talent. Affirmative Action Plan implemented Time to develop employees

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Sequencing-Human resource planning

Planning Process related to Strategy Resourcing strategy as employer of choice. Scenario planning-Trends Demand/ Supply forecasting-Techniques. Advertisement Recruiting Documentation
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HUMAN RESOURCE PLANNING PROCESS Forecast of labour demands Forecasts of labour supply

Forecasts of labour surplus or shortage

Goal setting and strategic planning Program implementation and evaluation

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A procedure for estimating Human Resource shortage or surplus for a job or Occupation category
Start with Current Census The number of people now in the group being studied Expected Losses The number of people expected to leave the group between now and the planning horizon due to retirements, quits, promotions, and deaths
To the remaining number add

Expected promotions. In light of human resource objective.

Replacement Needs

To the resulting number add

The resulting number is

Growth Needs As determined by organizational objectives.

The resulting number is

Replacement Needs

Surplus Shortage Predicted Demands

To be met by external supply

1. Number currently employed 70 2. Annual wastage rate based on past records percent 3. Expected losses during the year 4. Balance at end year 63 5. Number required at end year 75 6. Number to be obtained during year (5-4) 12

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Human Resourse Management

FACTORS AFFECTING HRP

1. 2. 3. 4. 5. 6. 7. Strategy to be followed. Growth cycle of firm. Environmental Uncertainties. Time Horizons Type and Quality of Forecasting. Nature of Jobs to be filled. Off-Loading of Jobs.
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REASONS FOR DEMAND FORCASTING:

1. Quantify the jobs necessary for producing goods. 2. Determine staff-mix desirable in the future. 3. Assess appropriate staffing levels in different parts organisation to avoid unnecessary costs.

4. Prevent shortage of people when they are needed most.

5. Monitor compliance with legal requirements.

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ENVIRONMENTAL SCAN
Tight Labor Market Recession Skill shortage High Turnovers High Tech Positions Stable Environs Expanding Environs
Employee choice wide Employer choice wide Employee choice wide Buy not make

Buy not Make Attrition made up Aggressive Recruiting

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Self-employment Peripheral group I Secondary labour markets Flexibility through quantitative adjustment

Core group
Primary labour markets Flexibility through utilization Short term contracts Part timers

Peripheral group II Job Public sharing Delayed subsidy recruitment trainees Out-sourcing

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OPTIONS
Category A- Directly employed Full time Part time workers Job sharers Flexitime Annual hour contracts Category B - Self employed - Free lance Category C - Agency workers - Subcontracts
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HUMAN RESOURCING:Planning and performance

Fluctuations in demand High Average core combined with Category A overtime and Category B own-pool temporaries Low Labour costs Large core combined with Category A part-time Small core workforce (inc. Category A home workers and parttimers) and Category C workers

High

Low Risk assessment model of flexible working patterns

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Average core combined with Category A parttimers, shift workers, home workers and Category C agency and/or subcontracts
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FORECASTING METHODS
QUALITATIVE Managerial Judgment QUANTITATIVE Extrapolation/ Trend OTHERS Budget Analysis

Delphi Technique Nominal Group Technique Expert Survey

Indexation Markov Analysis Regression

Transitional Analysis Computerized

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PROGRAMME PLANNING OPTIONS

Hire new full-time employees Offer incentives for postponing retirement Re-hire retired employees on part-time basis Attempt to reduce turnover Bring in overtime for present staff Subcontract work to another company Hire temporary employees Re-engineer to reduce needs.

If a shortage of employees is expected .

If a surplus of employees is expected .

Do not replace employees who leave Offer incentives for early retirement Transfer or re-assign excess employees Use slack time for employees training or equipment maintenance Reduce work hours Lay-off employees
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OPTIONS FOR REDUCING AN EXPECTED LABOR SURPLUS

Option
Downsizing Pay reductions Demotions Transfers Work sharing Retirement Natural attrition Retraining
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Speed
Fast Fast Fast Fast Fast Slow Slow Slow

Human Suffering
High High High Moderate Moderate Low Low Low
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OPTIONS FOR AVOIDING AN EXPECTED LABOR SHORTAGE

Option Overtime Temporary employees Speed Fast Fast Human Suffering High High

Outsourcing
Retrained Transfers Turnover reductions New external hires Technological innovation
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Fast
Slow Slow Slow Slow

High
High Moderate Low Low
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DOWNSIZING
Planned elimination of large number of personnel with goal of enhancing the organisationals competitiveness Does this option destroy the firms reputation in the labor market?

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DOWNSIZING
Reducing costs Replacing Labor by Tech Mergers & Acquisitions Moving to more economical locations Loss of talent Social network effected Drop of motivation Hurt image building Only as a last resort Improve forecasting

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TELE WORKING TRADE OFFS

ADVANTAGES
Gains in productivity Reduction of overhead Retention of rare skills Penetration of unusual labor markets

DISADVANTAGES
Lack of commitment Problems in communication Problems in supervision

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RETENTION PLANS
Compensation plans made attractive. Fair Appraisal management Advancement opportunities Congenial working climate. Compatibility job and person HR Audit.

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BARRIERS TO HRP
Principle of Employment at Will HR taking a back seat on Strat partner role. Financial forecasting takes precedence. Conflict between short and long term goals. Conflict between Qualitative and Quantitative methods of forecasting. Mis-coord between operations and HR

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Cost of Labor Turnover

Leaving cost Direct costs: Ad, Selection cost/time, Orientation/training costs

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The Labour turnover index

Number of leavers in a specified period (usually 1 year) X 100 Average number of employees during the same period

Stability index
Number 1 years service or more X 100 Number employed 1 year ago

Human Resourse Management

A HYPOTHETICAL TRANSITIONAL MATRIX FOR AN AUTO PARTS MANUFACTURER

2005 1. Sales manager 2. Sales representative 3. Sales apprentice 4. Assistant plant manager 5. Production manager 6. Production assembler 7. Clerical 8..Not in organization
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2009 (1) .95 .05

(2)

(3)

(4)

(5)

(6)

(7)

(8) .05

.60 .20 .50 .90 .10 .05 .75 .10 .80 .70

.35 .30 .05 .15 .10 .30

.00

.20

.50

.00

.10

.20

.30
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IBP PRESENTATION

Survival rate analysis

Entry Cohort A B C Original Strength 40 32 48 Number surviving to end of year after engagement Year 1 35 25 39 Year 2 28 24 33 Year 3 26 19 30 Year 4 22 18 25 Year 5 20 17 23

D
E Total Average survival rate

38
42 200

32
36 167

27
30 142

24
26 125

22
23 110

19
21 100

100 %

83 %

71%

62%

55%

50%

Human Resourse Management

Leavers by length of service

Leavers by length of service

Occupation

A B C Totals

Less than 3-6 6 1-2 3 months months month years s 5 4 3 3

15 8 28 12 6 22 10 5 18 6 4 13

3-5 years
2 3 3 8

5 or more years 3
4 4 11

Total Average Index of number number labour leaving employed turnover % 20 50 30 100 220 250 100 550 10 20 30 18

Human Resourse Management