HR PLANNING PROCESS:
HR PLANNING PROCESS:
HR planning process begins with considering the
organizational objectives and strategies. The HR plan is guided by larger term
organizational plan. For example, in planning for HR, an organization must consider
the allocation of people to job over larger period of time, not just for the
next month or even the next year. This
level of planning requires knowledge of strategic expansion or reduction in
operation and any technological change that may affect the organization.
On the basis of such analyses plans can be made for
shifting employees within the organization, laying off or
otherwise cutting back the number of employees, retraining
present employees or
increasing the number of employees
in certain areas. Factors to consider include the current employees’ knowledge,
skills and abilities in the organization and the expected vacancies resulting from
retirement, promotions, transfer or discharge.
HR plan provides a road map for the future, identifying
where employees are likely to be obtained, when employees will be needed and what
training and development of employees must occur.
The various activities involved in the process of HR planning
are as follow.
- Analyzing
organizational plans and objectives. The process of HR planning begins with
analyzing the overall plans and objectives of organization. It stems from
business plan. Analysis of business plan into sub sectional and functional
plans such as technology, production finance, marketing, expansion and
diversification provides for assessing the HR requirements for each
activity in each section and department.
- Analyzing
Objectives of HR Planning: The main purpose of HR planning is matching
employee’s abilities to enterprise requirements, with emphasis on future, instead
of present arrangement. The ultimate purpose of HR planning is to relate
future human resource to future enterprise
need so as to maximize the
future return on investment in human resources. For this
managers need to
specify the HR planning with regard to the utilization of HR in
the organization. While
developing specific objectives of HR planning certain questions need to be addressed.
- Whether the vacancies, as and when these arise will be
filled in by promotions , transfer or from external sources?
- What
will be the selection procedure?
- How
will provisions be made for training and development employees?
How to restructure
job positions i.e. how to abolish the
old or boring jobs and replace these by
challenging ones?
How to downsize the organization I the light of changing
business and industrial environment?
- Fore
casting demand for HR: The demand
for the HR in an
organization is subject to vary from time to time, depending upon both external and
internal factors.
EXTERNAL ORGANIZATIONAL WORKFORCE
Economics Strategic Plans Retirement
SSocio-ploitical legal Budgets Resignation
Technology Sales
and production forecasts Termination
Competitors New Ventures deaths
Organization
and job design leaves of absence.
SCANNING GOVERNMENT
INFLUENCES:
A major element that
affect labor supply and therefore HR
planning is the government. Today HR
managers are confronted with many
government regulations. As a
result HR planning must be done
by individuals who understand the legal requirements of
various government regulations
especially firms operating globally.
Tax legislation at local, state and federal levels also affects HR planning. Pension provision
and social security legislation may change retirement patterns and funding
options.
ECONOMIC CONDITIONS:
The general business
cycle of recession and economic booms also affects HR planning. Factors such
as interest rates, inflation and
economic growth affect the availability of workers and should figure into organizational and HR plans and
objectives. Decisions on wages, overtime and hiring or laying off workers may
be affected by economic conditions. E.g. economic conditions lead to decrease in the unemployment rate. There is a considerable difference
between finding qualified applicants in a 3% unemployment market and in a 7%
unemployment market. In the 3% unemployment market , significantly fewer
qualified applicants are likely to be available for any kind
of position. Applicant still available may be less employable
because they are less educated , less
skilled or unwilling to work.
GEOGRAPHIC AND COMPETITIVE CONCERNS:
Employer must consider the following geographic and
competitive concerns in marking the
HR plan, including other employers in the area , employee
resistance to geographic relocation,
direct competition in the industry
and the impact of international
competition . the net migration into a
particular region is important also.
Other employer in a geographic region can greatly expand or
diminish the labor supply.
Direct competitors
are another important external
force in HR planning. Failure to consider the competitive labor market and to offer pay
scales and benefits competitive in the same general industry and
geographic location may cost a company
dearly in the long run.
Finally, impact of international competition as well as
numerous other factors must be considered as a part of scanning environment. Global
competition for labor intensifies as global competitors shift workers and jobs
around the world.
TECHNOLOGY:
Changes are difficult to predict and assess but may
radically alter strategic and therefore HR plans. Many thought the computer
would cause mass unemployment. Today the
computer field is a large one, employing millions of people directly or
indirectly. Technology complicates HR planning
because it tends to reduce employment in one department while increasing it
another.
ORGANIZATIOANAL
DECISIONS:
As organizations
respond to these changes in their environment, decisions are made to modify the
strategic plan. The strategic plan commits the firm to long range objectives
such as growth rates and new products, markets or services. These objectives dictate the number and type
of employees needed in the future.
Budget increases or cut are the most significant short term influence
on HR needs.
New venture mean changing the HR demand. When a new venture
is begun internally, the lead time allows planners to develop short run and
long run employment plans. But new ventures begun through acquisition and
mergers cause an immediate revision of HR demands and can lead to a new
organization and job design.
WORKFORCE FACTORS:
Demand is modified by
employee actions such as retirements, resignations, terminations deaths and
leave of absence. Changes in the composition of work force combined with the
use of different work patterns have created workforce and organization that are
notable different from those of a decade ago. Many organizations face major
concerns about having sufficient workers with the necessary capabilities and
the flexibility to expand and contract the workforce as needed.
The use of part time employees can add flexibility through
temporary or more permanent arrangements. To address those concerns
organizations are implementing flexible staffing arrangements that include temporary
workers, job sharing, part time and outsourcing.
These arrangements are used to meet workload fluctuations, replace an absent
employee, and work on project with a definite end point and as a way to preview
whether an employee might work out well before formal hiring.
FORECASTING SUPPLY OF
HUMAN RESOURCES:
Having forecast HR demand,
the next task involved in HR planning is to forecast human resource supply.
There are two sources of supply; internal and external. The internal supply
consists of present employees who can be promoted, transferred or demoted to
fill expected openings. The external
supply consists of people who do not work for the organization.
Estimation of internal supply of HR involves more than
merely counting the number of employees. Planners audit the present workforce
to learn about their capabilities. This
information allows these planners to estimate tentatively which openings can be
filled by present employees. These tentative assignments usually are recorded
on a replacement chart.
Audits and replacement charts are also important additions
to the information base of the HR department. With greater knowledge of
employees, the department can plan recruiting, training and career planning activities
more effectively.
HUMAN RESOURCE AUDIT:
It summarizes each employee’s
skill, knowledge and abilities. Audits of non managers are skill inventories.
Audit of managers are known as management inventories.
A skill inventory form is divided into four parts.
Part 1 can be completed by Hr department from employee
records it identifies the employee’s job titles, experience, age and previous
job.
Part 2 seeks information about the skills, duties, responsibilities
and education of the worker. The employees’ future potential is briefly summarized
by the immediate superior in part 3. Performance, readiness for promotion, and
any deficiencies are noted here. The supervisor’s signature helps ensure that
the accuracy of form is reviewed by someone who knows the employee better than
the HR specialist.
Part 4 added as a final check for completeness and for the
addition of recent employee evaluation.
Replacement charts are a visual representation of who will replace
whom if there is a job opening. The chart much, like an organization chart, depicts
the various jobs in the organization and shows the status of likely candidates.
Replacement status consists of two variables. Present performance and promo
ability .present performance is determined largely from supervisory evaluation. The opinions of other managers, peers and
other subordinates may contribute to the appraisal of present performance. Future
promo ability is based primarily on present performance and estimates by
immediate superiors of future success in a new job.
SUCCESSION PLANNING:
It is a process of
identifying a larger term plan for orderly replacement of key employees. Given complexities
and time demands involve in developing these plans, succession planning is
usually limited to key employees and those identified as having long term
potential.
LABOR MARKET
ANALYSIS:
Success in finding
new employees depends on the labor market and the skills of managers and employment
specialist in the HR department. The relevant labor market is the market from which
the organization recruits; its size depends upon the skills being sought. For
highly skilled job, the relevant labor market may be the entire country. The
labor market for unskilled jobs is generally the local community.
MATCHING DEMANDS AND
SUPPLY:
Once demand for and
supply of HR of an organization is forecast, the two needs to be
reconciled. Such reconciliation will reveal
either shortage or surplus of HR in future. Accordingly action plans will be
prepared to meet the situation. In case of shortage of HR. This will be met through
recruitment, transfer, promotions training and development, retention.
In case of surplus of HR, it can be made through schemes
like redeployment. Voluntary retirement through golden hand shake.
MONITORING AND
CONTROL:
The final step
involved in HR planning is monitoring and control. Once the action plans are implemented
these needs to be reviewed, regulated, and monitored against set standards.
Monitoring of action plans and programs help reveal deficiency.