You are on page 1of 16

Human Resource

Planning
Chapter 5 (Dipak Kumars Book)
Human Resource Planning Process
HRM - 411 (Human Resource Planning)
Sec-02 & 3, Fall-2014
MARS

HRP Process
HRP process is a strategy for the
acquisition, utilization and retention of an
enterprise's human resources. It seeks to
link policy and practice in day to day
decision making. HRP process cannot be
applicable universally. It varies from
organization to organization.

HRP Process Outline


We can broadly outline the HRP process into four
different stages as under:

Stage 1: Investigation

It is the primary stage of HRP in any organization.


In this stage, organizations try to develop their
awareness about the detailed manpower scenario
by looking at their current manpower.
A SWOT analysis can reveal a better picture with
due consideration of the external environment,
performance, productivity trends, working
practices, operational and strategic plans.

Stage 2:Forecasting

After adequate investigation, in the next phase of


HRP process, analysis of demand and supply of
manpower is done.
There are different models of demand forecasting.
Manpower supply analysis is done considering both
internal and external supply. While doing internal
supply analysis, career planning and development,
training and succession plan aspects are
considered along with corporate policies and
procedures. Like in case of promotional policy- will
it be done on merit basis or seniority basis.
External supply analysis is done considering macro
level issues to understand their availability. It helps
to identify the status of employment (permanent,
contracting, sub-contracting)

Forecasting as a Part of Human Resource


Planning
Choose human
resource programs

DEMAND
FORECASTING

Determine
organizational
objectives

Internal programs

External programs

Promotion

Recruiting

Transfer

External selection

Career planning

Demand
forecast for
each objective
Aggregate
demand
forecast

SUPPLY
FORECASTING

Executive
exchange

Training

Turnover control
Internal supply forecast

Does aggregate
supply meet
aggregate
No
demand?
Yes

Go to feasibility analysis steps

External supply forecast

Aggregate supply
forecast

Stage 3: Planning and Control of Manpower

At this stage, forecasts of manpower are translated


into HR policies, which encompass all HRP related
issues like recruitment, training, and development.
While going for recruitment, it is necessary to
understand the job descriptions and job roles. To
address the problem of knowledge and skill
obsolescence in the context of changing
technology, training and development policies of
the organizations should be made accordingly.
While doing HRP, flexibility and inter-relationship
of all other policies also need to be considered.
Control must be there to correct any observed
deficiency in such plans.

Stage 4: Utilization
In this final stage of HRP process, success is
measured in terms of achievement trend, both in
quantitatively and qualitatively.
While quantitative achievement is visible from
productivity trend, manpower cost, etc.

Qualitative achievement is a subjective appraisal


on achievement of organizational objectives.
Reflection of qualitative achievement can also be
studied in the context of prevailing industrial
relations, level of motivation and morale,
grievance pattern etc.

Forecasting of Demand
(Quantitative Tools)
Time Scale of HRP Forecasts- Determining time scale of
human resource forecast is very important to decide about
their availability and chart the possible action to meet the
requirement. Depending on time frame , which again depends
on the basis of requirement, nature of analysis of externalinternal source , keeps on changing.

Analysis of Workload Factors

To forecast the manpower requirements at different points


of time.
Analysis of present and future workload depends on the
possibility of quantifying the work content in every area of
an organizational activity.

Steps of workload analysis:


1. Classification of Work

Classification of work is done by identifying the work or


job content and time requirement for such job or work
unit. It helps in breaking jobs in different components,
which together completes an operation.
2. Forecasting the Number of Jobs

After classification of jobs and work content and its time


requirement, in the next phase, job forecasting in
quantitative terms for a number of jobs is done for a time
period.
3. Converting the Projected Jobs in Man-hours

Multiplying the time requirement of each job with the


number of projected jobs, man-hours for jobs are
computed.
4. Converting the Man-hours into Manpower Requirement

In the final phase of workload analysis, aggregate manhours are converted into manpower requirements.

Time Series Analysis


Employment data over a time period (time series) are
used under this method as the basis for manpower
forecast. It has five distinct elementsTrend: Fluctuations in level of employment over a
time period.
Cyclical Effects: Change in employment in relation to
some particular event.
Seasonality: Seasonal fluctuations occur more than
once in a given time period.
Step: This is a sudden change in employment level
due to economic environment or increased market
share or procurement of some new machines, etc.
Random Fluctuations: These are fluctuations in
employment level which are random in nature, i.e.,
such fluctuations do not follow any obvious pattern.

Time Series Analysis

Moving Average Method


Weighted Moving Average Method
Exponential Smoothing

Managerial Judgment
A manager has to make a judgment
about the future employment levels.
Such judgmental decision is based on
his past experience, which he relates to
past occurrences of some events and its
effects on manpower plans. Combining
quantitative tools with judgment yield
better results.

Analysis of Manpower Supply


Wastage Analysis
Manpower wastage is an element of labour turnover.
It is not labour turnover by itself. It includesvoluntary retirement, normal retirement,
resignations, deaths and dismissals.

Wastage Analysis Curve identifies three different


phases
During induction phase, marginal employees
leave.

During differential transit period, an employee


learns about the organization and identifies his
role in it.

During the period of settled connection, an


employee settles down and decides to stay long.

Analysis of Manpower Supply


Wastage Analysis
Wastage decreases with the increase of length of
service.
Wastage also decreases with the increased skill
exercises and age of employees.
Characteristically wastage of manpower is more in
female than male employees.
It varies with the level of employment and also
exhibits seasonal variations.
Working conditions and size of the firm are also
important variables of manpower wastage.

Different Methods of Wastage Analysis


Labour Turnover Index

Indicates the number of leavers as


percentage of average number of employees.
Average number of employees employed in a
given time period is decided by adding the
employees at the beginning and end then
dividing the same with two.

Stability Index

Indicates stable workforce percentage for a


given period.

Different Methods of Wastage Analysis


Cohort analysis
Cohort analysis takes into account the
length of service, which is an important
variable of wastage analysis. It is more
accurate for a small homogenous group.
But changing social and economic
conditions can invalidate this analysis.