HUMAN RESOURCE

PLANNING PROCESS

CHAPTER 2
Slide editing by : mursyida mahshar
 HRP (Definition)
Process of analyzing and identifying the need
for and availability of HR so that the org. can
meet its objectives or
Process that helps to provide adequate HR to
achieve future organisational objective.
It will include ; forecasting future needs for
employees of various type, compare these
needs with the present workforce and
determine the no. or types of employees to
be recruited into or phased out.
 Small Business and HR Planning Issues
Attracting and retaining qualified outsiders
Management succession between generations
of owners
Evolution of HR activities as business grows
Family relationships and HR policies
Issues in forecasting HR
requirements:
Increasingly of service oriented
Increasingly economy based on technology
Teams becoming more widely used
Needs for fewer managers with increasing
technology
Issues in HR availability:
Management inventories
Succession planning
Skill inventory
External labor supply
Purpose of HR Planning
 Benefits of HR Planning
Better view of the HR dimensions of
business decisions
Lower HR costs through better HR
management.
More timely recruitment for anticipate HR
needs
More inclusion of protected groups through
planned increases in workforce diversity.
Better development of managerial talent
 Linking HRP & Strategy for
Competitive advantage
Strategy of Culture of Competitive / Current
organizatio organizati Fin. organization
n on Advantage structure

Need for HR Qty Available Financial

& Skill Levels Resources

HR Plans and Policies for:

Performance mgmt Recruiting
Selection Staffing
mgmt
HR Development
 HR Strategies
Cost Leadership Differentiation
Competition on the Competition on the basis of
basis of low price either offering distinctively
and high quality of different products or
product or service services or establishing an
Relies on building exclusive image for quality
employees to fit products and services
specialized needs Relies on hiring needed
skills.
Requires a longer HR
planning horizon Needs a shorter planning
approach time frame in order to be
responsive to dynamic
environments.
 HR Strategies
Organizatio Strategic HR Strategy HR Activities
nal Focus
Strategies
Cost Efficiency Long HR planning Promote from
Leadership Stability horizon within
Cost control Build skills in Extensive
existing employee training
Job & employee Hire & train for
specialization specific
efficiency capabilities
Differentiati Growth Shorter HRP External staffing
on Innovation horizon Less training
Decentralizati Hire the HR Hire & train for
on capabilities needed broad
Broader, more competency
flexible jobs &
 HR Responsibilities

Top HR executive and subordinates

gather information from other
managers to use in the development of
HR projections for top management to
use in strategic planning and setting
organizational goals
 HR Unit Managers
- Participates in -Identify supply and
strategic planning demand needs for
process. each department.
- Identifies HR -Review / discuss
strategies. HRP info. With HR
- Designs HRP data specialists.
systems. -Integrate HR plan
-Compiles and with departmental
analyzes data on plans.
staffing needs. -Monitor HR plan to
SP The process of determining what
identify org.s
changes
mission and plan to achieve organisational goals.
needed.
HR Planning Process
HRP Process

ENVIRONMENTAL SCANNING
& SITUATIONAL ANALYSIS

FORECASTING THE DEMAND

AND SUPPLY OF HR

DEVELOPMENT OF PLANS
FOR ACTION
 Scanning the External
Environment
Environmental Scanning
The process of studying the environment of the
organization to pinpoint opportunities and threats.
Situational Analysis
HRM compares needed and available skills for
training, promotion, transfer, productivity
improvement and succession planning.
Environmental Changes Impacting HR
Governmental Influences
Economic conditions
Geographic and competitive concerns
Workforce composition
 Assessing the Internal
Workforce
Jobs and Skills Audit
What jobs exist now?
How many individuals are performing each job?
What are the reporting relationships of jobs?
How essential is each job?
What jobs will be needed to implement future
organizational strategies?
What are the characteristics of anticipated jobs?
 Assessing the Internal Workforce
(contd)
Organizational Capabilities Inventory
HRIS databasessources of information
about employees knowledge, skills, and
abilities (KSAs)
Components of an organizational capabilities
inventory
Individual employee demographics
Individual employee career progression
Individual job performance data
 Forecasting HR Supply and
Demand
Forecasting
The use of information from the past and
present to identify expected future conditions.
Forecasting Methods
Judgmental
Estimatesasking managers opinions, top-
down or bottom-up
Rules of thumbusing general guidelines
Delphi techniqueasking a group of experts
Nominal groupsreaching a group consensus
in open discussion
 Forecasting HR Supply and
Demand (contd)
Forecasting Methods (contd)
Mathematical
Statistical regression analysis (statistic compares the
past r/ships among various factors)
Simulation models (representation of real situations in
abstract form)
Productivity ratiosunits produced per employee
Staffing ratiosestimates of indirect labor needs
Forecasting Periods
Short-termless than one year
Intermediateup to five years
Long-rangemore than five years
HR Forecasting
 Forecasting the Demand for
HR
To develop a forecast of the needs for
HR by number and type for the
forecasted period
Estimate no. and type of employees
for future
a) External Supply
b) Internal Supply

Demand = Supply
 Forecasting supply for HR

Forecast the availability of HR internal

and external supplies.
Use skill inventory :
to assess the current supply of employees
(past and present skills), used for future,
and maintained through interview and
questionnaires.
Estimating Internal Labor Supply
for a Given Unit
 Managing HR Surplus / Shortage
Action when Surplus of employees
i) Layoff - Suspension or termination of employment (with or without
notice) by the employer due to management problems. (merit &
seniority)
ii) Early retirement encourage employees to leave org. early.
iii) Restrict Attrition & freeze hiring not replace the jobs been left out
(quit @ retire), and those remain in the co. will be given more tasks.
iv) Reduced Hours of work
Suggestion to deal with downsizing
Investigate alternatives to downsizing
Involve those people necessary for success in the planning for
downsizing
Develop comprehensive communicate plans
Nurture the survivors
Outplacement pays off
Action When Shortage of
Employees
Promote Overtime - ask the workers to
work after the standard working hours
Hiring New employees
Hire contingent worker subcontract,
contract, part time

Outplacement services
A group of services provided to the displaced
employee to give them support and
assistance.
E.g. personal career counseling, resume
preparation, interviewing workshops and
referral assistance.
 HRIS?
Find information about HRIS