chapter 4 hrm

HRM NIFT - Rajyalakshmi 1

HR Planning


Contents • Definition & objectives • The process of Human Resource

Planning • Assessing current human resource &

making inventory • Forecasting • Matching the inventory with future

requirements • Managing the forecasted

demand/surplus • Dealing with surplus manpower • Current trends.


Quote

“At the end of every day, the assets of most companies walk out the door. The challenge facing those companies is to provide an environment that will encourage their assets to want to return the next morning.”


Definition Right number of people with right

skills at right place at right time to implement organizational strategies in order to achieve organizational objectives

In light of the organization’s objectives, corporate and business level strategies, HRP is the process of analyzing an organization’s human resource needs and developing plans, policies, and systems to satisfy those needs


Objectives Enable organizations to

anticipate their future HRM needs

Identify practices that will help them meet those needs.

Prevent overstaffing & understaffing

Ensure organization is responsive to changes in its environment.

Provide direction & coherence to all HR activities & systems


Benefits of HR Planning Better view of the HR dimensions of

business decisions Lower HR costs through better HR

management. More timely recruitment by

anticipating HR needs More inclusion of protected groups

through planned increases in workforce diversity.

Better development of managerial talent


Long range Objective & plans

Overall requirements for HR

Inventory present HR

New HR requirement

Action for Recruiting & Selecting

Procedures evaluating effectiveness of HRP

Short term Goals ,Plans , Programs & Budget

Work force requirement by occupational categories,

skills, demographic basis

Inventory by occupational categories, skills, demographic basis

Needed replacements or additions

Plans for developing, upgrading ,

transferring in recruiting & selecting

Pro

cess

of

HR

Pl

anni

ng


Assessing current Human Resources It begins by developing a profile of

the current Status of human resources.

It is an internal analysis that includes an inventory of the workers & skills already available within the organization & a comprehensive Job analysis.


Human Resource Inventory The inputs to this report are derived from forms completed by employees , checked by supervisors & the personal department.

These reports include details names, education, etc. for every employee in the organization. – HRIS (Human Resource Information System):

•Computerized employee information system•Uses

– transaction processing– employee self-service– decision support

– Succession Planning/Replacement Charts: •Some organizations also generate a separate

executive inventory report i.e. succession planning.

•These are organization charts indicating positions that may become vacant in the near future


ForecastingDEMAND FORECASTING

SUPPLY FORECASTING

Determine organizatio

nal objectives

Demand forecast for

each objective

Aggregate demand forecast

Does aggregate

supply meetaggregatedemand?

Go to feasibility analysis steps

Choose HR programs

External programs

•Recruiting•External selection

•Executive exchange

Internal programs•Promotion•Transfer•Career planning•Training•Turnover control

Internal supply forecast External supply forecast

Aggregate supply

forecastNo

Yes


Forecasting The use of information from the past and

present to identify expected future conditions.

Estimating not only ‘how many’ but also ‘what kinds’ of employees will be needed

Yields advance estimates or calculations of the organization’s staffing requirements

Apart from quantitative tools, a great deal of human judgement is involved

Incredibly difficult tasks, especially in rapidly changing environment


Fo

reca

stin

g M

etho

ds


Forecasting HR Supply and Demand

• Forecasting the Demand for Human Resources– Organization-wide estimate for total

demand– Unit breakdown for specific skill needs by

number and type of employee•Develop decision rules (“fill rates”) for

positions to be filled internally and externally.

•Develop additional decision rules for positions impacted by the chain effects of internal promotions and transfers.


Forecasting the Supply for HR

Forecasting External HR Supply Net migration for an area Individuals entering and leaving the workforce Individuals graduating from schools and

colleges Changing workforce composition and patterns Economic forecasts Technological developments and shifts Actions of competing employers Government regulations and pressures Other factors affecting the workforce

External Supply Internal Supply


Forecasting Internal HR Supply

Effects of promotions, lateral moves, and terminations

Succession analysis•Replacement charts•Transition matrix (Markov matrix)

ExitManager Supervisor Line WorkerManager .15 .85 .00 .00.Supervisor.10 .15 .70 .05Line Worker .20 .00 .15.65


Estimating Internal Labor Supply for a Given Unit


Matching the inventory with future requirements

Surplus Shortage


Shortage

Recruitment

Training

Succession planning– The process of identifying a long-

term plan for the orderly replacement of key employees


Surplus Manpower


Workforce ReductionsIdentifies employer requirements for layoff

advance notice. 60-day notice to employees and the local

community before a layoff or facility closing involving more than 50 people.

Does not cover part-time or seasonal workers. Imposes fines for not following notification

procedure. Has hardship clauses for unanticipated

closures or lack of business continuance capabilities.


Workforce Realignment“Downsizing”, “Rightsizing”, and

“Reduction in Force” (RIF) all mean reducing the number of employees in an organization.

– Causes Economic—weak product demand, loss of

market share to competitors

Structural—technological change, mergers and acquisitions


Workforce Realignment Positive consequences

Increase competitiveness Increased productivity

Negative consequences Cannibalization of HR resources Loss of specialized skills and experience Loss of growth and innovation skills

Managing survivors• Provide explanations for actions and the

future• Involve survivors in

transition/regrouping activities


Downsizing approaches Attrition and hiring freezes

Not replacing departing employees and not hiring new employees/

Early retirement buyouts Offering incentives that encourage senior

employees to leave the organization early. Layoffs

Employees are placed on unpaid leave until called back to work when business conditions improve.

Employees are selected for layoff on the basis of their seniority or performance or a combination of both.


Downsizing approaches (cont’d)

Outplacement services provided to displaced employees to give them support & assistance:

Personal career counseling Resume preparation and typing services Interviewing workshops Referral assistance Severance payments Continuance of medical benefits Job retraining


Dealing with Downsizing

Investigate alternatives to downsizing Involve those people necessary for

success in the planning for downsizing Develop comprehensive

communications plans Nurture the survivors Outplacement pays off


Role of HR Professionals

The Past The Future• Operational

• Monitor• Short term• Administrative• Reactive• Activity focus

• StrategicStrategic• PartnerPartner• Long termLong term• ConsultativeConsultative• ProactiveProactive• Solution Solution

focusfocus


Emerging Roles for HR Professionals

Human Capital Developer

Functional Expert

Employee Advocate

Strategic PartnerHR Leader


Thank you

chapter 4 hrm

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