bbap 322 human resource planning

8/12/2019 Bbap 322 Human Resource Planning

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HUMAN

RESOURCE

PLANNING

BBAP 322LECTURERNAT FIIFI AMISSAH-AIDOO

[email protected]


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Objectives:

At the end of this session students are

expected to to be able to:define Human Resource Planning

from different dimensions

Explain the what goes in into the HRplanning process


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HUMAN RESOURCE

PLANNING - Introduction

HR Planning is like any other form of planning

It is a means to an end. The END In this case is to secure the Human

Resource of the organisation in order to achieve itscorporate objectives.

It encompasses the HR activities to secure the RightEmployees at the Right Place at the Right Time.

It is the first step in the recruiting and selection

process ..


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DEFNITIONS

A rational approach to the effective, recruitment, retentionand development of people within an organisation, including,when necessary, arrangements for dismissing staff(Management Theory and PracticeGerald A Cole 6thEd pg169)

HR Planning is concerned with the flow of people throughandsometimes outof the Organisation

Effective HR Planning is not just the right number of people butconcerned with the optimum deployment of peoplesknowledge and skills.

I.e Quality is even more than the quantity.

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DEFNITIONS

The systematic and continuing process of analysing anorganisations human resource needs under changingconditions to ensure that the right number of people and theright types (skills, knowledge and behaviours) of people areavailable at the right time for the organisation. (HumanResource Management Dessler et al 1999 pg41)

To be worthwhile, HR planning has to be integrated both into

the organisations internal process and externally, into markets ofthe wider environment.

Human resource plans (Like any good plans) are built onpremises- basic assumptions abut the future.

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DEFNITIONS Human Resource Planning is the Process an organisation uses to

ensure that it has theright amount and the right kind of peopleto deliver a particular level of output or services in the future.(Managing Human Resource 5thEd.- Gomez-Mejia et al:(2007)pg. 147)

Firms that do not conduct HRP may not be able to meet theirfuture labour needs (a labour shortage) or may have to resort to

layoffs (in case of labour surplus)

Failure to plan could lead to significant financial cost.

Elsewhere Lay offshigh taxes

OvertimePremium wage

Legal requirement

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Key Questions to answer in

HR planning What kind of people does the organisation require and in

what numbers?

Over what time-span are these people needed?

How many of them are currently employed by theorganisation?

What is the age profile, by department of the existing

employees?

How many employees, on the average leave theorganisation every year?

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Key Questions to answer in

HR planning Which department of the organisation do we tend to lose more

employees?

How can the organisation meet the shortfall in requirement frominternal sources?

How can the organisation meet the shortfall from externalsources?

What changes are taking place in the external labour marketwhich might affect the supply of human resources?

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Aims & Importance of HR

Planning HRP aims to ensure that the organisation has the number of right

people, the right skills needed to meet forecast requirements.(Armstrong 2009 p487)

Research conducted by the Institute for employment studies(Reilly, 1999) established that there are a number of reasons whyorganizations choose to engage in some form of HRP.

1. Optimizing the use of resources

2. Process benefits (understanding the present in order toconfront the future.)

3. Linking HR plans to Business Plans.

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Planning

A key goal of HRP is to get the right number of people with the rightskills, experience, and competencies in the right jobs at the righttime and at the right cost.

This ensures that the business production requirements are met in anefficient and effective manner.

Having too many employees is problematic due to the risk of highlabour expenses,

downsizing, or layoffs. Having too few employees is also

problematic due to high overtime costs, Reduces the risk of unmet production requirements, and the

challenge of finding the instant human resources needed to get thejob done.

(Bulmash et al, 2010)

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Planning It evolved when big companies which employed many workers

began to go through shocks and disturbances in crucial times inrelation to man power, creating instabilityand in the long run

financial lost.

To maintain numerically stable employment over time,management requires data on when, where and howemployees need to be recruited.

HR planning is a crucial managerial function that providesmanagement with information on resource flows which is usedto calculate amongst other things, recruitment needs andsuccession and development plans.

(Beardwell, 1995)

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Planning- Summary 1. Current and Future Manpower Needs

2. Coping With technological, political, socio-cultural, and

economic Change

maintain numerically stability

3. Recruitment Of Talented Personnel

4.Development Of Human Resources

5. Proper Utilization Of Human Resources

6. Uncertainty Reduction

7. many others: find out

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HR forecasting

human resource planning links people management to theorganizations mission, vision, goals and objectives, as well as itsstrategic plan and budgetary resources. A critical component

of an effective HR plan is the method of forecasting.

1. FORECATING is the process of formulating plans to fill futureopenings based on the analysis of the positions that areexpected to be open and whether these will be filled byinside or outside candidates.Dessler & Lloyds-Walker (1999)

2. Human resource forecasting is a process that helps anorganization determine how many employees it will need inthe future to meet its strategic goals.


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HR forecasting HR forecasting involves establishing:

A. what jobs the company will need to fill,

B. what types of skills employees must have to do those jobs and

C. what challenges the company will face as it works to meet itsstaffing needs.


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HR Supply and Demand Labour Supply : is the availability of workers who

possess the required skills that an employer mightneed.

Labour Demand: is the number of skilled workersan organisation needs to execute its businessobjectives.

Estimating future supply and demand and takingsteps to balance the two require PLANNING


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Objectives of this Lecture Define HR forecasting

Explain Forecasting Demand and supply

Appreciate the process of forecasting

Explain generally the HR Planning process


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Demand Forecasting

Ratnam & Srivastava (1991) Demand forecasting refers to the process estimating the future

need of manpower(Human resource) in the context ofcorporate and functional plans and forecasts of future activity

levels of the organisation.

Demand for human resource should be based on corporateplans and annual budget translated into activity levels foreach function and department.


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Forecasting HR needs

Demand Aspect Managers should consider several factors when

forecasting HR needs.

In reality, demand for product and services isparamount

In a manufacturing firm sales are projected first

Then the volume production required to meet

these sales requirements is determined

Finally the needed to to maintain this volume ofoutput is estimated


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Demand Aspect In addition to production and sales demand planners will also have

to consider several factors:

Projected turnover of employees (as a result of resignations and

terminations)

Quality and nature of employees ( in the light of changing needs ofthe organisation)

Decisions to upgrade the quality of products or services or to enterinto new markets.

Technological and administrative changes resulting in increasedproductivity.

The financial resources available to HR dept.


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Supply Aspect The HR Demand forecast answers the question: how many

employees will we need?

Next, Supply must be forecast.

Before determining how many OUTSIDE candidates to hire, Theplanner must forecast how many candidates for the projectedopening will come from within the organisations existing ranks.

A qualification inventory can facilitate forecasting the supply ofinside candidates.

What is qualification inventory?

It contains summary of data such as each employees

Performance record

Educational background and promotability

Compiled either manually or computerized.


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THE FORECASTING PROCESS EXAMINE THE CURRENT JOB MARKET

One of the primary steps in forecasting workforce availability is to seriouslyconsider the economicand populationissues that affect employment.

Manpower forecasting can be more difficult when there is uncertainty inthe labor market.

Human resource professionals must consider issues such as the currentdemographics and unemployment rate of the local job market.

E.g. Substantial number of young graduates entering the workforce at thesame time increases the possibility of filling some job vacancies at acheaper salary or wage rate.

Age, training and level of education are other factors that affect the talentavailable in the job market.


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THE FORECASTING PROCESS EVALUATE ORGANIZATIONAL NEEDS

HR planners must consider the type and size of their

organizations and examine their own human resource needs. Data collection from all departments.

Assessment of the existing job positions within the organization.

HR managers should consider the kinds of jobs and number ofworkforce performing in each department.

Forecast should help to determine if employees have thequalifications and expertise to satisfy the companys futureneeds.


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THE FORECASTING PROCESS ANTICIPATE EMPLOYEE TURNOVER

HR must not be unaware of their staff replacement rate i.e. the numbers and therate at which employees leave and get replaced in the organisation.

HR must appreciate the organizations existing and future objectives in order toefficiently forecast workforce demand that will support organizational strategies.

In addition, human resources must anticipate the need for creating new positionsand modifying current positions.

Employee turnover rates place demands on organizations to improve employee

retention and recruitment strategies.

Knowing available labour force in the job market is vital when it comes to fillingavailable positions when workers retire; some are promoted to higher positions;and others poached to go elsewhere.


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THE FORECASTING PROCESS ESTIMATE FUTURE HR NEEDS

Once organizational needs has been defined and available resources in theworkforce identified, it can plan for future labor needs.

Factors to consider include evaluating

current employee potential,

determining training needs and

putting succession plans in place.

Matching the right number of employees skills to an organizations goals atthe relevant time helps a company to achieve its strategic objectives and

improves employee job satisfaction as well

The HR Planning Process


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The diagram above looks at the human resources planningprocess.

The firm must deal with demand sideissues of labour and theexpected demand for labour from the firm.

They must also deal with supply side issues. In other words arethere enough staff, internally or externally to meet the expecteddemand of staff from the company?

Lets quickly look at supply side issues.



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Internal Supply of Labour

The organisation needs to examine if they have enough staff to meet the demandof labour. Is training available within the firm to meet future labour needs? Whatpercentage of workers are about to retire and are they going to be replaced? Doterms and conditions of services currently keep staff motivated?

When examining internal labour needs, these issues need to be taken intoaccount.

External Supply of Labour

If the supply of labour is not available internally, then the firm may need to recruitnew staff. Are the staff then available within the local market? Do they have therequired skill? If they are not available within the local market, how do we findthem? Advertise in the next town? Or even overseas?

Human resources planning is an important part of running a business. If a businesswishes to expand and do well, it must take into account current and future needsof its labour workforce.



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HRP- steps in recruitment &

Selection process

Employment

planning &forecasting

Recruiting:

Build a poolofcandidates

ApplicantsComplete

Applicationforms

Use selectiontools like

Tests to screen

outMost applicants

Managers & Supvrsinterview final

Candidates to makeFinal choice

Candidate

becomesemployee

The Recruitment and selection process is a series of hurdlesaimed at selecting the best candidate for the job.

Human Resource Mgt. Gary Dessler 2005 pg152


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bbap 322 human resource planning

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