Hr Planning

Planning for Human Resources

HR Planning 

HR planning 

Defined as the “process of identifying and responding to organizational needs . . . and charting new policies, systems, and programs that will assure effective human resource management under changing conditions.”

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Objectives of HR planning 

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Enable organizations to anticipate their future HRM needs Identify practices that will help them meet those needs

HR Planning - Benefits 

Benefits of human resource planning    

Aids in the planning of job assignments Helps cope with fluctuations in staffing requirements Identifies recruiting needs Provides other useful information regarding human resource needs

Consequences of failure to plan 

Employers are forced to respond to events after they occur, rather than before; that is, they become reactive, rather than proactive.

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An organization may be unable to correctly anticipate an increase in its future demand for employees. 

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At best, such a company would be forced to recruit employees at the last minute and may thus fail to find the best candidate. At worst, the company may become seriously understaffed.

Strategic Planning 

Through the strategic planning process, organizations determine where they are going. 

The process typically consists of the following activities: 1. 2. 3. 4.

Determine the organizational mission. Scan the organizational environment. Set strategic goals. Formulate a strategic plan, part of which addresses human resource needs.

Strategic Planning (cont.) 

Step 1: Determine the organizational mission 

Mission statement  

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A declaration of the organization’s overall purpose Defines the basic business scope and operations that distinguish the organization from others of a similar nature Answers the questions:  

“Why does our organization exist?” “What unique contributions can it make?

Strategic Planning (cont.) 

Step 2: Scan the organizational environment 

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The firm’s external and internal environments must be scanned to identify threats and opportunities. External environment 

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Challenges posed by political, legal, economic, social, and technological issues Planners must also scan their industry environment.

Internal environment 

Assess the firm’s strengths and weaknesses in order to form strategic goals that take advantage of strengths

Strategic Planning (cont.) 

Step 3: Set strategic goals 

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Specify the desired outcomes that must be reached if the firm is to accomplish its mission Strategic goals should be:   

Specific Challenging Measurable

Strategic Planning (cont.) 

Step 4: Formulate a strategic plan 

Specifies the courses of action a firm must take in order to meet its strategic goals

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Formulated by: 1.

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Translating organizational goals into more narrow functional or departmental goals Devising strategies for meeting these goals

Human Resource Planning 

Demand forecasting 

Involves predicting the number and types of people the organization will need at some future point in time

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Two general approaches are:  

Statistical Judgmental

Statistical Approaches 

Trend analysis 

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Ratio analysis 

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The future demand for human resources is projected on the basis of past business trends regarding a business factor. The process of determining future HR demand by computing an exact ratio between the specific business factor and the number of employees needed.

Regression analysis  

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Is similar to both trend and ratio analyses Forecasts are based on the relationship between a business factor and workforce size. This method is more statistically sophisticated.

Precaution regarding the use of statistical methods 

Statistical methods of demand forecasting assume that the relationship between workforce size and the business factor remains constant over time.

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If this relationship were to change unexpectedly, the forecast would become inaccurate.

Judgmental Approaches 

Involves the use of human judgment, rather than a manipulation of numbers

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Two most common techniques:  

Group brainstorming Sales force estimates

Supply Forecasting 

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The process used to estimate which positions will be filled at a particular point in time Steps to supply forecasting 

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Step 1: Organization groups its positions by title, function, and level of responsibility. Step 2: Estimate within each job group, how many of its current employees will:   

Remain in their positions during the planning period How many will move to another position How many will leave the organization

Oversupply of Employees 

The current trend toward organizational restructuring usually results in a smaller workforce. 

Downsizing 

Because of the negative outcomes that are often associated with layoffs, employers are encouraged to seek alternatives.

Undersupply of Employees 

Hiring additional workers

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Alternatives to additional hiring 

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Improve productivity of existing workforce through additional training Overtime Additional shifts Job reassignments Temporary workers Improve retention rates