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Master of Business Administration-MBA Semester 3 MU0010 – Manpower Planning and Resourcing Assignment Set- 1 Q.1 What are the five steps in Manpower Planning? Ans:- The employment process begins with manpower planning i.e. the forecasting and determination of the exact personnel requirements and a company and the specification of the strategies and tactics for the acquisition, utilization, improvement and preservation of its human resources. The aim of manpower planning is to avoid shortfalls and surpluses of labour. Shortages lead to over utilization while surpluses lead to redundancy and underutilization of manpower. With manpower planning, a firm does not react to each new set of circumstances on the basis of the short-term personnel needs which they present. Rather, the systematic steps that are taken provide overall co-ordination, direction, and logic for its personnel decisions. Man power planning is defined by Vetter as:“the process by which management determines how the organization should move from its current manpower position to its desired manpower position.” Through planning, the management strives to have the right number and right kind of people , at right places, at the right time, doing things which result in both the organization and the individual receiving maximum long run benefit. According to Gordon MacBeath, manpower planning involves two stages. The first stage is concerned with the detailed “ planning of manpower requirement for all types and levels of employees throughout the period of plan.,” and the second stage is concerned with “ the planning of manpower supplies to provide the

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Master of Business Administration-MBA Semester 3MU0010 – Manpower Planning and Resourcing

Assignment Set- 1

Q.1 What are the five steps in Manpower Planning?

Ans:- The employment process begins with manpower planning i.e. the forecasting and determination of the exact personnel requirements and a company and the specification of the strategies and tactics for the acquisition, utilization, improvement and preservation of its human resources.  The aim of manpower planning is to avoid shortfalls and surpluses of labour.  Shortages lead to over utilization while surpluses lead to redundancy and underutilization of manpower.  With manpower planning, a firm does not react to each new set of circumstances on the basis of the short-term personnel needs which they present.  Rather, the systematic steps that are taken provide overall co-ordination, direction, and logic for its personnel decisions.

Man power planning is defined by Vetter as:“the process by which management determines how the organization should move from its current manpower position to its desired manpower position.”

Through planning, the management strives to have the right number and right kind of people , at right places, at the right time, doing things which result in both the organization and the individual receiving maximum long run benefit.

According to Gordon MacBeath, manpower planning involves two stages. The first stage is concerned with the detailed “ planning of manpower requirement for all types and levels of employees throughout the period of plan.,” and the second stage is concerned with “ the planning of manpower supplies to provide the organization with the right type of people from all sources to meet the planned requirements.”

The main steps involved in manpower planning are as follows:1.         Ascertain objectives and operating plans:  The first step in manpower planning is to ascertain the objectives and operating plans of the company.  This is because it is the company’s plans and anticipated levels of production and activity that will determine the specific quantity and quality of manpower that will be required.

 2.        State the manpower implications of projected operations:  The second step is to specify the manpower implication of the company’s projected operations and plans.  This exercise which is an assessment of manpower demand might show the need for more labour in certain areas while showing the need for reduction of labour in others.

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3.         Make an inventory of the firm’s manpower:  The third step is to take an inventory of the manpower resources within the firm.  This involves the physical counting of employees (a form of census) to know the number of workers that are available in each occupational category.  If the numbers of workers available are not enough to cope with the planned future operations, then more staff will be needed.  If there is going to be an excess of employees, then plans have to be made to reduce the present staff strength.

4.         Match resources with requirements: The fourth and final step is to match resources with requirements.  If there is going to be a shortage of particular categories of personnel in future then arrangements have to be made to recruit more of such workers from the external labour market.  Some workers in the company may of course be trained and upgraded to fill some of the expected vacancies.

5.         Design training programmes: These will be based upon extent of diversification, expansion

plans, development programmes,etc. Training programmes depend upon the extent of improvement in

technology and advancement to take place. It is also done to improve upon the skills, capabilities,

knowledge of the workers.

 Activities involved in Manpower Planning:

Identifying and designing current and planned organization structure of the organization. Estimating current and future workload for different functions and organizational units in

the organization, and, based on that, estimating the current and future total requirement of people to fill the various positions of different types and at different levels.

Developing profile or specifications for people to fill the various positions identified. Taking an inventory of existing employees in the company, and their capabilities. Comparing the manpower requirements and availability to determine the additional

people required in the organization at different times. While working out this requirement, suitable provision is made for likely attribution of some of the existing employees. Similarly while examining capability requirements of employees consideration is given to on the development of skill and capability of people with work experience. This activity results in identification of the total additional manpower requirements to be fulfilled by various means.

Determining, the means of acquiring the additional required manpower through various means such as external recruitment, internal transfers and promotions, and training.

Preparing recruitment plan. Preparing training plan.

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Manpower planning plays a vital role in Human Resource activity of an organization.  Human Resource is an asset to every organization. Manpower planning mainly involves determining the needs and supply of human resource and the available sources.

The organization should make Manpower Planning in such away that it should satisfy both organization and employer at a higher level.  It result in creating working environment and maintain better employee and employer relationship. 

Q.2 Explain Supply forecasting.

Ans:- Forecasting a company’s future demand in human resources is a necessary procedure in

light of organizational objectives and strategies. Forecasting is based on information from the

past and the present to identify expected future conditions. Such information may come from

external environmental scanning and/or the assessment of internal strengths and weaknesses.

There are different methods for forecasting human resources demand that range from a

manager’s best guess to a complex computer simulation. While simple assumptions may be

sufficient in small-sized companies, complex models that combine subjective judgment and

quantitative data are usually necessary for larger organizations. The future demand for

employees is calculated on an organization-wide basis; the needs of individual units in the

organization are taken into consideration. The HR expert or an experienced manager who

handles the forecasting process needs to consider specific openings that are likely to occur and to

use such data as the basis for planning. Openings are created when employees leave a position

because of promotions, transfers, and terminations. Forecasting leads to projections for the

future. Depending on the forecasting method used, the projections may be more or less subject to

error. Once human resources needs have been identified, the availability must be checked. The

forecast of the availability of human resources is considering both internal and external supplies.

Internally, succession plans developed to identify potential personnel changes, due to promotion,

retirement, resignation, etc for each department in an organization are examined. By the end of

this analysis, the organization is able to know if there are employees to cover future demand

from within its resources. Externally, there are many factors, such as the labor-force population

estimates, trends in the industry, technological developments and shirts. The organization must

take such factors into consideration to be able to know if ideal candidates can be located.

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HR  SUPPLY  FORECASTING  --  CONSIDER  THE  FOLLOWING

1.EXPERT

Informal  internal  surveys.

managers  prepare  their  own estimates based  on  workload.

Formal  external  surveys.

planners  survey  managers, using  questionnaires  or   focused  discussion.

Delphi  techniques

solicit  estimates from  a  group  of  managers, until  the estimates   converge.

2.TREND  PROJECTIONS

Extrapolations

extending  past rates  of  change  into  the  future.

Indexation

matching  employment  growth with , say,  sales.

Statistical  analysis

OTHERS

Planning  and  budgeting  systems  

based  on  strategic  and  corporate  plannings/ budgeting.

New  venture  analysis

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making  comparisons  with similar  operations.

Computer  models

using  multiple  variables.

Q.3 What is the cost approach of HR ACCOUNTING?

Ans:- HRA is the art of valuing, recording and presenting systematically the work of human resources in the books of accounts of an organisation. Thus, it is primarily an information system, which informs the management about the changes that are taking place in the human resource of an organisation.

 DEFINITIONS

“Human Resource Accounting is the process of identifying and measuring data about human resources and communicating this information to interested parties.”

                                                                              - American Accounting Society Committee on HRA

 “Human Resource Accounting is an attempt to identify and report investments made in human resources of an organisation that are presently not accounted for in conventional accounting practice. Basically it is an information system that tells the management what changes over time are occurring to the human resource in the business.”

-     Woodruff

 “A term used to describe a variety of proposals that seek to report and emphasize the importance of human resources – knowledgeable, trained and loyal employees in a company earning process and total assets.”

  - Davidson and Roman L Weel

 “Human resource accounting is the measurement of the cost and value of the people for the organisation.”

                          - Eric Flamholtz of university of California, Los Angeles

 

Objectives of HR Accounting

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The objective of HRA is not merely the recognition of the value of all resources used by the organisation, but it also includes the management of human resource which will ultimately enhance the quantity and quality of goods and services. The main objectives of HR Accounting system are as follows:

1. To furnish cost value information for making proper and effective management decisions about acquiring, allocating, developing and maintaining human resources in order to achieve cost effective organisational objectives.

2. To monitor effectively the use of human resources by the management. 3. To have an analysis of the human assets i.e. whether such assets are conserved, depleted

or appreciated.4. To aid in the development of management principles. and proper decision making for the

future by classifying financial consequences of various practices.5. In all, it facilitates valuation of human resources recording the valuation in the books of

account and disclosure of the  information in the financial statement.6. It helps the organisation in decision making in the following areas:

Direct Recruitment vs. promotion, transfer vs. retention, retrenchment vs. retention, impact on budgetary controls of human relations and organisational behaviour, decision on reallocation of plants closing down existing units and developing overseas subsidiaries etc.

 

Advantages of HR Accounting

Human Resource Planning anticipates not only the required kind and number of employees but also determines the action plan. The major benefits of HR accounting are:

a)     It checks the corporate plan of the organisation. The corporate plan aiming for expansion, diversification, changes in             technological growth etc. has to be worked out with the availability of human resources for such placements or key             positions. If such manpower is not likely to be available, HR accounting suggests modification of the entire corporate             plan.

b)      It offsets uncertainty and change, as it enables the organisation to have the right person for the right job at the right time      and place.

c)         It provides scope for advancement and development of employees by effective training and development.

d)         It helps individual employee to aspire for promotion and better benefits.

e)         It aims to see that the human involvement in the organisation is not wasted and brings high returns to the organisation.

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f)           it helps to take steps to improve employee contribution in the form of increased  productivity.

g)         It provides different methods of testing to be used, interview techniques to be adopted in the selection process based on        the level of skill, qualifications and experience of future human resources.

h)        It can foresee the change in value, aptitude and attitude of human resources and accordingly change the techniques of           interpersonal management

  Methods of valuation of human resource management

1.  Historical Cost Approach – This approach was developed by William C. Pyle (and assisted by R. Lee Brummet & Eric G. Flamholtz) and R.G. Barry corporation, a leisure footwear manufacturer based on Columbus, Ohio (USA) in 1967. In this approach, actual cost incurred on recruiting, hiring, training and development the human resources of the organisation are capitalised and amortised over the expected useful life of the human resources. Thus a proper recording of the expenditure made on hiring, selecting, training and developing the employees is maintained and a proportion of it is written off to the income of the next few years during which human resources will provide service. If the human assets are liquidated prematurely the whole of the amount not written off is charged to the income of the year in which such liquidation takes place. If the useful life is recongnised to be longer than originally expected, revisions are effected in the amortisation schedule. The historical cost of human resources is very similar to the book value of the other physical assets. When an employee is recruited by a firm, he is employed with the obvious expectation that the returns from him will far exceed the cost involved in selecting, developing and training in the same manner as the value of fixed assets is increased by making additions to them. Such additional costs incurred in training and developing is also capitalised and are amortised over the remaining life. The unexpired value is investment in human assets.

This method is simple to understand and easy to work out. It meets the traditional accounting concept of matching cost with revenue. It can provide a basis of evaluating a company’s return on its investment in human resources.

But it suffers from the following limitations:

It takes into account a part of the employees acquisition costs and thus ignores the aggregate value of their potential services.

It is difficult to estimate the number of years over which the capitalised expenditure is to be amortised.

It is difficult to determine the rate of amortisation. Should it be increasing, constant or decreasing one?

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The economic value of human resources increases over time as the people gain experience. But in this approach, the capital cost decreases through amortisation.

 

2.   Replacement Cost Approach – This approach was first suggested by Rensis Likert, and was developed by Eric G. Flamholtz on the basis of concept of replacement cost. Human resources of an organisation are to be valued on the assumption that a new similar organisation has to be created from scratch and what would be the cost to the firm if the existing resources were required to be replaced with other persons of equivalent talents and experience. It takes into consideration all cost involved in recruiting, hiring, training and developing the replacement to the present level of proficiency and familiarity with the organisation.

This approach is more realistic as it incorporates the current value of company’s human resources in its financial statements prepared at the end of the year. It is more representative and logical. But it suffers from the following limitations:

a)       This method is at variance with the conventional accounting practice of valuing assets.

b)      There may be no similar replacement for a similar certain existing asset. It is really difficult to find identical replacement of the       existing human resource in actual practice.

c)       The determination of a replacement value is affected by the subjective considerations to a marked extent and therefore, the           value is likely to differ from man to man.

3.  Opportunity Cost – This method was first advocated by Hc Kiman and Jones for a company with several divisional heads bidding for the services of various people they need among themselves and then include the bid price in the investment cost. Opportunity cost is the value of an asset when there is an alternative use of it. There is no opportunity cost for those employees that are not scarce and also those at the top will not be available for auction. As such, only scarce people should comprise the value of human resources.

This method can work for some of the people at shop floor and middle order management. Moreover, the authors of this approach believe that a bidding process such as this is a promising approach towards more optional allocation or personnel and a quantitative base for planning, evaluating and developing human assets of the firm. But this approach suffers from the following limitations:

a)       It has specifically excluded from its preview the employees scarce or not being ‘bid’ by the other departments. This is likely to       result in lowering the morale and productivity of the employees who are not covered by the competitive process.

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b)      The total valuation of human resources on the competitive bid price may be misleading or inaccurate. It may be due to the          reason that a person may be an expert for one department and not so for the other department. He may be valuable person for       the department in which he is working and thus command a high value but may have a lower price in the bid by the other              department.

c)       Under this method, valuation on the basis of opportunity cost is restricted to alternative use within the organisation. In real life       such alternative use may not be identifiable on account of the constraints in an organisational environment. 

Q.4 Discuss talent engagement model

Ans:- Talent engagement is about employees going the extra mile and putting in discretionary efforts because their values and interests are aligned with that of the organisation..

According to David C. Forman, Chief Learning Officer of the Human Capital Institute“Talent Engagement represents the extent to which the workforce identifies with the company, is committed to it and provides discretionary effort so that it can be successful. Engagement is a key leading indicator for high performance workplaces, improved employee productivity and subsequent turnover.”

Most organizations today realize that a 'satisfied' talent is not necessarily the 'best' talent in terms of loyalty and productivity, but it is the 'engaged talent' who is intellectually and emotionally bound with the organization, who feels passionately about its goals and is committed to its values. The engaged talent goes the extra mile beyond the basic job responsibility and is associated with actions that drive the business and who puts in his maximum skill and talent in accomplishing the common goal. Therefore, it becomes mandatory for organizations to focus on talented talents, so that they can be utilized maximum in favor of the organization instead of focusing on talents who are unable to put in their maximum. This defines and explains the importance of "Talent Engagement" over and above "Employee Engagement". Development Dimensions International (2007) defines

According to Nitin Vazirani (2007), there are certain aspects of talent engagement, which are significant and should be managed both by the talents and the employer's efforts.

The three basic aspects of talent engagement :

(i) The talents and their own unique psychological makeup and experience

(ii) The employers and their ability to create the conditions that promote talent engagement

(iii) Interaction between talents at all levels.

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The above aspects are the organization's responsibility and they have to create an environment and culture conducive to this partnership, and a winwin equation.

People are the emotional and intellectual asset of your organisation. Business in the third millenium demands the natural talents of individuals be both recognised and unleashed.

It is the volume and intensity of discretionary effort freely offered by individuals, in alignment with natural strengths, that directly impacts corporate success and personal fulfillment.

Discretionary effort is ultimately harnessed through engagement.

Contemporary organisations are powered by an engine room of diversity. How to recognise, mine and polish the talents of individuals within such diversity (cultural, generational and profile) requires a deeper understanding of drivers and a dynamic map to follow.

The Glow International 5C Employee Engagement Model provides such a platform to:

Invigorate employee engagement

Increase business performance

Create a unique culture of success

Unleash talent

Harness discretionary and personal effort through this sparkling 6 pack of discovery; loaded with dynamic presentations, fun activities and powerful take away tools.

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The most appropriate work environment of engagement would lead to a heightened sense of employee motivation, which, in turn, would lead to enhanced or discretionary effort. Enhanced effort is not just putting in the extra time; it also refers to getting things done in the right manner. Talent engagement represents the extent to which the workforce identifies with the company, is committed to it and provides discretionary effort so that it can be successful. Engagement is a key leading indicator for high performance workplaces, improved employee productivity and minimized turnover.

Q.5 Write a note on internal sourcing

Ans:- Internal Sourcing teams definitely have a very important function in today’s market. They are relationship builders, trust earners and communicators of the company. They not only understand the subtle nuances of the hiring departments, but the competition as well. They know where their prospects hide and sniff them out with a dangling carrot; the wonderful opportunity he or she can’t afford not to hear. They acquire talent more for the win than for the money.

The term internal recruitment is defined as the practice of choosing amongst current companyworkers to fill a position that falls vacant over time. The vacancy could sometimes be advertised throughout a company; this could be on the company's monthly or quarterly job-sheet. Most institutions of higher learning use this practice. The practice is evoked occasionally when a company's employee has been rendered redundant in their current post, and oftentimes it's a way used to promote a certain company employee sideways other than up the firm. Internal recruitment is often resorted to as a way of saving money that could be spent through advertisements and also to cut on training costs that an outside employee would need to become familiar with the system.

Internal vacant positions are advertised in various ways, it could be done through an internal job sheet, the company's notice board or through the company's intranet - this is the type of website whose viewing is limited to the organizations members. Others companies have company magazines that they use for advertisement purposes while others may use staff meetings - this

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could be used when an organization wants to advertise the vacant position to a specific group of employees.

Advantages of internal recruitment are more than just cutting on advertisement costs because it offers wonderful opportunities for the current staff to further their careers. Internal recruitment could also be a great way of keeping workers who may have been considering a flight from the company, this is advantageous because the cost of training are at most best insignificant and to the worst much less than it would cost if the organization advertised outside. It's definitely faster and less costly than outside recruitment and it has the added merits because current employees are a familiar entity. Some organizations conduct external recruitment only to discover later that they have a member of staff who doesn't fit into the general environ and the mission and vision statement of the organization.

The disadvantage of internal recruitment is that the size of prospective applicants is considerably reduced. There is no doubt that outside recruitment provides the organization with a broader skill pool and wider experience than could be the case with internal recruitment. A staff member who responds to the internal advertised position and gets the job might discover that their workmates resent that promotion and that could prove very challenging for them in their newfound positions. If a company does its recruitment internally, It most probably faces the possibility of having another empty position to fill, and of how to do that. Organizations that heavily rely on inside recruitment might eventually find that they have to advertise outside the organization, the cost notwithstanding. Current staff may fill to be the best candidates for the position regardless of whether they have the necessary expertise and expertise required for the job.

Q.6 Write a note on performance management

Ans:- The field of performance management can comprise two separate types of management. In one aspect of performance management, an analyst may view the performance of a company as a whole, and also evaluate the effectiveness of the managers and heads of companies in reaching goals. In another sense, performance management may be a system of evaluating employees to help them reach reasonable goals and thus ensure that the company performs better. This discussion will focus on the latter definition.

Performance management of individual employees differs. It generally includes the following: planning work, setting goals, offering feedback and reviews, offering opportunities to learn more in one’s field, and rewarding employees who perform well.

Employee performance management works best when work is planned and goals are consistent. This may mean having a clear way to communicate regarding work expected at the moment and upcoming work. Planning also includes defining expectations of the employee so that he or she is not broadsided by evaluation criteria not included in planning.

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Planning and setting goals in performance management also creates a system of predictable rewards for good performance, and consequences for poor performance. This way the employee can reasonably assume the consequences of work performance, whether good or bad.

Performance management also involves giving feedback to employees on a more consistent basis than the average annual review. Instead, an employee’s ability to exceed or failure to meet goals may be monitored on a monthly basis. This provides the employee with either the opportunity to receive compliments and rewards fairly regularly, or to make behavior changes sooner if performance is not up to par.

Often employees feel that end of the year reviews contain criticisms of work in the past year that were never openly discussed with the employee. The employee benefits from a more consistent model of performance management evaluation, since this gives a person time to address issues and change problem issues.

In a performance management model, employees must also be given ways to grow and develop in their field. This means giving opportunities to work on harder projects, pairing less-skilled employees with expert employees, and offering team models where employees can direct and make decisions. Greater responsibility and opportunities to advance in one’s field are essential to maintaining happy and productive employees.

Rewards are also a huge part of performance management. The greatest part of this is rewards of monetary nature, either in bonuses or raises, when employees perform well. As well, employees who actually are now qualified to work in a high level of their field should be placed in positions of greater responsibility, and receive a greater share of pay. Performance analysis should focus as much or more on positive performance than it does on negative performance. Rewards for positive performance must be real and tangible, or else the company runs the risk of becoming a “negative action” company only.

Employee performance management may be taught to companies who have difficulty maintaining performance of employees or who have a long history of unhappy employees and turnaround. Companies may hire experts in performance management to learn how to model its concepts.

As review about key terms in performance management, key terms are below:

1. Review organizational goals to associate preferred organizational results in terms of units of performance, that is, quantity, quality, cost or timelinessOrganizational goals are often established during strategic planning. Performance management translates these goals to results, which typically are described in terms of quantity, quality, timeliness or cost. Results are the primary products or services desired from the focus of the performance process. Examples are a percentage increase in sales, extent of impact on a certain community, etc. Goals should be "SMART" (an acronym), that is, specific, measurable, acceptable, realistic to achieve and time-bound with a deadline. For example, an overall goal may be to increase the organization's profit by 30% by the end of the next fiscal year. An associated

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strategy (or sub-goal), among others, may be to increase profit of the Catalog Department by 50% over the next fiscal year.

2. Specify desired results for the domain -- as guidance, focus on results needed by other domains (e.g., to internal or external customers)For example, the operator's results are high-quality, printed images for the internal customer, the Catalog Department. This aspect of performance management is sometimes called "goal setting", particularly when the focus of the performance process is on employees. Goals should be "SMART" and challenging.

3. Ensure the domain's desired results directly contribute to the organization's resultsAligning results with organizational results is another unique aspect of performance management process. Do the employee's results directly contribute to the results of the organization? What organizational goals? How? For example, do the prints directly contribute to the desired profit increase of 50% of the Catalog Department? How? Is there anything else the operator could be doing that would be more productive for this goal? Should a job analysis be done to verify efficiency

4. Weight, or prioritize, the domain's desired resultsA weight, or prioritization, is often in the form of percentage-time-spent, or a numeric ranking with "1" as the highest. For example, the employee's results might be weighted as follows: a) 80% of his time over an 8-hour period, Monday through Friday over the next fiscal year, to be spent running the machineb)10% of this time in trainingc)10% of this time in a Quality Circle.

5. Identify first-level measures to evaluate if and how well the domain's desired results were achievedMeasures provide information to evaluate accomplishment of results. Measures are usually specified in terms of quantity, quality, timeliness or cost. For example, measures for the operator might be the number of prints over some time interval, a certain grade on a test during his training and attendance recorded on attendance sheets to his Quality Circle. Identifying which measures to take is often the toughest part of the performance management process. You have to look at the appropriate level or domain in the organization, its desired results, and consider what are the most valid, reliable and practical measurements to use. With complex and rapidly changing domains, it often helps to identify outcome and driver measures, and patterns of effects. More about these terms in Performance Measurement, which is also referenced back in Basic Overview of Performance Management.)

6. Identify more specific measures for each first-level measure if necessaryFor example, regarding the operator's measure for operating his machine, he may have to produce at least 500 high-quality prints an hour for eight hours, Monday through Friday during the fiscal year. High-quality means no smears or tears. The Director of the Catalog Department evaluates whether the operator made this goal or not.

7. Identify standards for evaluating how well the domain's desired results were achievedStandards specify how well a result should be achieved. For example, the operator "meets expectations" if the Director of the Catalog Department agrees that the operator produced 500 high-quality prints an hour for eight hours, Monday through Friday during the fiscal year. If he produces 600, he "exceeds expectations", 700 is "superior performance", 400 is "does not meet expectation", etc.

8. Document a performance plan -- including desired results, measures and standardsThe performance plan describes the domain's preferred results, how results tie back to the organization's results, weighting of results, how results will be measured and what standards are used to evaluate results. Developing the plan is often the responsibility of the head of the domain (in this example, the employee's supervisor). However, the plan should be developed as much as

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possible with participants in the domain. (Note that a performance plan is not the same as a "performance development plan", which is mentioned later below.)

NOTE: Now is the best time to take stock of overall performance plans. Does the domain have the necessary resources to achieve preferred results, e.g., necessary funding, training, input from other subsystems, etc? Are the standards realistic? Can the domain realistically achieve the results within the preferred time frame? Does everyone involved in the measures really understand how to recognize the measures? Do they know their role in the performance management process?

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Master of Business Administration-MBA Semester 3MU0010 – Manpower Planning and Resourcing

Assignment Set- 2

Q.1 Explain different types of tests used for selection.

Ans:- Tests play an important part in the selection process of new employees. Tests are of different types but their main goal is to measure an applicant's skills, check their personalities and find out if they match the positions available in a certain company or organization. The use of software in providing skill testing has become popular these days. This is said to be more cost-effective compared to hiring the wrong employee for the job.

Organisations typically use several different methods to assess job applicants: you will usually be asked to complete an application form, send in a copy of your resume and attend at least one interview. One method that is becoming increasingly used is employee selection tests. These tests aim to provide a potential employer with an insight into whether you will be able to cope with the intellectual demands of the job and how well you work with other people.

 

  Employee selection tests can be split into personality tests and aptitude/ability tests.

Employee Selection Tests - Aptitude and Ability Aptitude and ability tests consist of multiple choice questions and are administered under exam conditions. These types of test can be broadly classified onto the groups shown and you may be asked to sit a test which consists only of ‘numerical’ questions or these may form part of a test which consists of questions of different types.   

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 This will depend very much on the job you are applying for. For example, jobs that require you to handle figures on a day to day basis may have a higher proportion of numerical reasoning questions, whereas tests used for information technology jobs tend to have a higher proportion of abstract reasoning questions.

Verbal Ability Tests  – Includes spelling, grammar, ability to understand analogies and follow detailed written instructions.

Numeric Ability Tests  - Includes basic arithmetic, number sequences and simple mathematics. In more complex numerical critical reasoning questions, blocks of information are provided that require interpretation.

Abstract Reasoning Tests - Measures your ability to identify the underlying logic of a pattern and then determine the solution. They are deliberately designed so that the visual problem-solving strategy will work better than any other approach.

Spatial Ability Tests - Measures your ability to manipulate shapes in two dimensions or to visualize three-dimensional objects presented as two-dimensional pictures.

Mechanical Aptitude Tests - Designed to assess your knowledge of physical and mechanical principles.

Data Checking Tests - Measure how quickly and accurately errors can be detected in data and is used to select candidates for clerical and data input jobs.

Work Sample Tests – Involves a sample of the work that you will be expected do. These types of test can be very broad ranging. They may involve exercises using a word processor or spreadsheet if the job is administrative or they may include giving a presentation or in-tray exercises if the job is management or supervisory level.

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Employee Selection Tests – Personality Personality has a significant role to play in deciding whether you have the enthusiasm and motivation that the employer is looking for and whether you going to fit in to the organization.

The principle behind personality questionnaires is that it is possible to measure your personality by asking you about your behavior and feelings. You will be presented with statements describing various ways of feeling or acting and asked to respond to them as either ‘true’ or ‘false’ or on a scale. For example: 

1. I enjoy noisy parties ?A) True B) False 2. I always trust my intuition?A) strongly disagree

B) disagree C) neutrals D) agree E) strongly agree

These tests can help prospective employers to find the best match of individual to occupation and working environment. As a recruitment and selection tool, they can be applied in a straightforward way at the early stages of selection to screen-out candidates who are likely to be unsuitable for the job or, using a more sophisticated approach, to provide guidance on career progression to existing employees

Q.2 Describe the designing of an induction program

Ans:- An induction program is the process used within many businesses to welcome new employees into the firm or organization and prepare them for their new role. An induction is planned to provide the new employee with the information he/she requires to settle comfortably and efficiently into the firm. Some of the organizations do not lay emphasis on this function.

An induction often starts by a meeting with the HR manager. In the meeting information is shared about the work environment, the new job description, benefits, organization culture, the safety of the individual, company history and anything else relevant to working in the new organization. Induction includes an introduction to each department in the organization.

Induction primarily allows the employee to get familiarized with the basics of the organization, its policies and procedures, its processes, it goals, vision, mission, values, compensation payout methods, reimbursement payout methods and the nature of business the organization is involved

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in. These basics focuses more on the information or knowledge that is immediately required for the employee to feel comfortable. It is also the beginning of the employees experiencing the organizations work culture.

When the employee needs to know much more about the functioning of the organization, an orientation session may be conducted in addition to an induction program in which the new employee spends time doing the jobs in each department to understand the product or service through the organization. Or the employee may spend time meeting different people in the organization to understand a little bit more about the working of the organization. The orientation program for different groups of employees could be tailored differently to achieve their orientation program goals in specific. The best new employee orientation programs:

Have targeted goals and objectives to meet them Makes the first day a celebration and memorable

Involves family as well as colleagues

Makes new hires productive on the very first day

Are not boring, rushed or inefficient

Uses feedback for continuous improvement.

Induction Program Outline

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Q.3 Elaborate the role of training managers

Ans:- Whether or not you're the person who actually conducts the training for your staff, as their manager, your role in training is a crucial one. Your employees will take their lead from you when it comes to the part training plays in the success of the team. It's essential for you to be a strong advocate and a vigorous champion of training.

It's no wonder so many employees, in contact centers and elsewhere, dread training. It's often poorly planned and even more poorly executed. But training doesn't have to be dry and monotonous. In fact, effective training - whether it's centered around skills, product knowledge, or anything else-is active, informative, and fun. Yes, fun!

How to Position Training

A lot of "the buzz" about training happens in the days and weeks prior to the actual sessions. Following are some tips for accomplishing this:

Training Design Duties : The HRD manager analyzes the training needs of the corporation, identifies areas requiring improvement, and assesses the company's learning environment along with the characteristics of the employees that will be trained. The HRD manager sets goals and objectives for the training programs and meets with company executives to gain their support of

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the strategic training plan. Once the parameters of the training courses are agreed upon, the HRD manager designs the necessary training course content and selects the most effective delivery method.

Training Course Development Duties: The HRD manager develops the training material using a variety of media including web-on-demand videos, print or electronic textbooks, instructional databases, or facilitated on-site classes. Production of the training material is supervised by the HRD manager to ensure the identified training goals and objectives are met. In most cases, the training classes are facilitated by training and development staff members. Once the classes have been completed, the HRD manager evaluates the training results and makes any adjustments needed to increase the effectiveness of the training.

Employee Development Duties : Further developing the skill level of employees is another important task of the HRD Manager. Classes are created to assist company personnel with effective time management, organizational strategies, resume writing and interview skill building, effective leadership strategies, stress management and career planning. She often plans and implements leadership development programs for employees interested in moving to managerial roles.

Team Management Duties : In addition to creating the training courses for the organization, the HRD manages the training and development staff. He is responsible for recruiting, hiring, training and developing high quality employees for the team. Setting and maintaining the training budget are also duties of the HRD manager as well as managing the team's resources effectively in regards to assigning tasks to team members, scheduling training classes and ordering necessary supplies for training functions.

Other Duties: HRD managers regularly serve as consultants to the company's executive management team for a variety of needs including identifying training solutions for under-performing departments of the company, and developing effective change management strategies when the organization is going through a merger or company re-organization. In large corporations, the HRD manager is called upon to develop succession planning training and development strategies for executive personnel.

Q.4 Discuss talent engagement model.

Ans:- Engaged talents feel inspired, energized and motivated to give their best and hence talent engagement is central to retaining key talent and securing sustained high levels of individual, team and organizational performance. But the way organizations lead, organize and manage talents frequently results in disengaged, frustrated and demotivated employees whose potential is underutilized and whose performance is sub optimal. Too often the organization adopts a rigid, mechanistic approach to people and organizations, particularly in times of uncertainty and change. Therefore a Talent Engagement Model is suggested as shown in fig. 4 for the organizations, who really want to engage their talents and want to leverage their skills to

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accomplish both the organizational and individual goals.The first and the most critical aspect are the, "engagement drivers". These are the levers that organizations can use to build a more engaging work environment.

Organizations must hire employees who fit the job requirements, develop leaders with the right skills, and provide support through strong systems and strategies of engagement and convert them into actually engaged talents. Employees expect to be valued and involved, good quality line management, two way communications, career development, clear company values and image and atlast they want efficient and effective use of their skills and talents which help them to convert into an engaged talent Together, working on drivers lead to the formation of an engaging work environment. Once created, the engaging work environment has a positive impact on employee behaviors and attitudes. In particular, an engaging environment builds the feeling of psychological ownership in the minds of talents by meeting their personal and practical needs, thus encouraging them to put redundant efforts for maximum performance and stay with the organization. In addition, an engaging work environment taps into talents' motivation to try harder and put forth the extra effort that differentiates organizations from their competitors. Finally, when organizations have engaged talents, the long-term benefits appear in the bottom line. Organizations have more satisfied and loyal customers, increased profits, better-quality products or services, and greater growth potential. Organizations drive engagement by proactively leveraging three sources of influence for change: employees, leaders, and organizational systems and strategies. These three sources work in unison to build an engaging work environment. Although engagement has multiple drivers, the ultimate ownership of engagement rests within the individual employee. Organizations hoping to drive engagement must tap into employees' passion, commitment, and feeling of ownership with the organization. This is accomplished by implementing the critical engagement drivers as mentioned in the previous section.The engagement drivers initiate more and more engaged talents and tries to develop an emotional connection between the talent and the organization, the first phase of "Cognitive Think". The second important component of the model is generation of the possessive feeling among talents regarding their organization known as "Psychological Ownership", which leads to the positive attitude of "Organizational Commitment" and the positive behavior of "Job Satisfaction" among employees which is the second phase of "Affective

 Feel".

The outcome of the engaged talent can be seen in the "Behavioral Act", the last phase of talents intention to stay and redundant efforts which leads to Talent Retention and Increased Performance respectively

The most appropriate work environment of engagement would lead to a heightened sense of employee motivation, which, in turn, would lead to enhanced or discretionary effort. Enhanced effort is not just putting in the extra time; it also refers to getting things done in the right manner. Talent engagement represents the extent to which the workforce identifies with the company, is committed to it and provides discretionary effort so that it can be successful. Engagement is a

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key leading indicator for high performance workplaces, improved employee productivity and minimized turnover.

Q.5 Explain career planning process.

Ans:- Career planning is a lifelong process, which includes choosing an occupation, getting a job, growing in our job, possibly changing careers, and eventually retiring. The Career Planning Site offers coverage of all these areas. This article will focus on career choice and the process one goes through in selecting an occupation. This may happen once in our lifetimes, but it is more likely to happen several times as we first define and then redefine ourselves and our goals.

Career Planning: A Four Step Process

The career planning process is comprised of four steps. One might seek the services of a career development professional to help facilitate his or her journey through this process. Whether or not you choose to work with a professional, or work through the process on your own is less important than the amount of thought and energy you put into choosing a career.

Self

Gather information about yourself (self assessment)

Interests

Values

Roles

Skills/Aptitudes

Preferred Environments

Developmental Needs

Your realities

Options

Explore the occupations in which you are interested

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Research the industries in which you would like to work

Research the Labor Market

Get more specific information after you narrow down your options by:

Job Shadowing

Part time work, internships, or volunteer opportunities

Written materials

Informational interviews

Match

During this phase of the process, you will:

Identify possible occupations Evaluate these occupations Explore alternatives

Choose both a short term and a long term option

Action

You will develop the steps you need to take in order to reach your goal, for example:

Investigating sources of additional training and education, if needed Developing a job search strategy Writing your resume Gathering company information Composing cover letters Preparing for job interviews

First of all, you do not totally know yourself. At some point, some people would know you more than you do. Therefore, if you are confused about the decision that you are making, ask close friends. They might give you some career planning advice or insight about where you truly excel.

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Try to also ask your former mentors. They have assessed your strengths and weaknesses at one time, so they might give you lots of help now.

Ask your parents too. In the end, your career directions would be a consolidated effort that are accomplished by you as well as of the people who helped mentor you - including your parents.

Indeed, having to decide career choices are difficult, sometimes mind-boggling.

You have to take a stand. You may encounter several career planning advice tips or get some career planning tools, but in the end the decision boils down to you.

Whatever it is that other people would say can only help you make a decision, but must definitely not dictate your decision.

Q.6 Write a detailed note on Retirement

Ans:- Retirement is the point where a person stops employment completely (or decides to leave the labor force if he or she is unemployed). A person may also semi-retire by reducing work hours.

Many people choose to retire when they are eligible for private or public pension benefits, although some are forced to retire when physical conditions don't allow the person to work any more (by illness or accident) or as a result of legislation concerning their position. In most countries, the idea of retirement is of recent origin, being introduced during the 19th and 20th centuries. Previously, low life expectancy and the absence of pension arrangements meant that most workers continued to work until death. Germany was the first country to introduce retirement in the 1880s.

Nowadays most developed countries have systems to provide pensions on retirement in old age, which may be sponsored by employers and/or the state. In many poorer countries, support for the old is still mainly provided through the family. Today, retirement with a pension is considered a right of the worker in many societies, and hard ideological, social, cultural and political battles have been fought over whether this is a right. In many western countries this right is mentioned in national constitutions.

Retirement in specific countries

A person may retire at whatever age they please. However, a country's tax laws and/or state old-age pension rules usually mean that in a given country a certain age is thought of as the "standard" retirement age.

The "standard" retirement age varies from country to country but it is generally between 55 and 70. In some countries this age is different for males and females, although this has recently been challenged in some countries (e.g., Austria), and in some countries the ages are being brought into line. The table below shows the variation in eligibility ages for public old-age benefits in the United States and many European countries.

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CountryEarly

retirement age

Normal retirement

age

Employed, 55–59

Employed, 60–64

Employed, 65–69

Employed, 70+

Austria 60 (57) 65 (60) 39% 7% 1% 0%Belgium 60 65 45% 12% 1% 0%Denmark none 65 77% 35% 9% 1%France 62* 65* 51% 12% 1% 0%Germany 65 67 64% 23% 3% 0%Greece 57 65 51% 31% 8% 1%Italy 57 65 (60) 34% 12% 1% 0%Netherlands 60 65 53% 22% 3% 0%Norway 62 67 ? ? ? ?Spain 60 65 46% 22% 0% 0%Sweden 61 65 78% 58% 5% 1%Switzerland 63 (61), [58] 65 (64) 77% 46% 7% 2%United Kingdom

none 65 69% 40% 10% 2%

United States 62 67 66% 43% 20% 5%

Notes: Parentheses indicate eligibility age for women when different. Sources: Cols. 1–2: OECD Pensions at a Glance (2005), Cols. 3–6: Tabulations from HRS, ELSA and SHARE. Square brackets indicate early retirement for some public employees.

In the United States, while the normal retirement age for Social Security, or Old Age Survivors Insurance (OASI), historically has been age 65 to receive unreduced benefits, it is gradually increasing to age 67. For those turning 65 in 2008, full benefits will be payable beginning at age 66.

Public servants are often not covered by Social Security but have their own pension programs. Police officers in the United States are typically allowed to retire at half pay after only 20 years of service or three-quarter pay after 30 years, allowing people to retire in their early forties or fifties. Military members of the US Armed Forces may elect to retire after 20 years of active duty. Their retirement pay (not a pension since they can be involuntarily called back to active duty at any time) is calculated on total number of years on active duty, their final pay grade and the retirement system in place when they entered service. Allowances such as housing and subsistence are not used to calculate a member's retired pay. Members awarded the Medal of Honor qualify for a separate stipend, regardless of the years of service. Military members in the reserve and US National Guard have their retirement based on a point system.

Factors affecting retirement decisions

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Many factors affect people's retirement decisions. Social Security clearly plays an important role. In countries around the world, people are much more likely to retire at the early and normal retirement ages of the public pension system (e.g., ages 62 and 65 in the U.S.). This pattern cannot be explained by different financial incentives to retire at these ages since typically retirement benefits at these ages are approximately actuarially fair; that is, the present value of lifetime pension benefits (pension wealth) conditional on retiring at age a is approximately the same as pension wealth conditional on retiring one year later at age a+1. Nevertheless a large literature has found that individuals respond significantly to financial incentives relating to retirement (e.g., to discontinuities stemming from the Social Security earnings test or the tax system).

Greater wealth tends to lead to earlier retirement, since wealthier individuals can essentially "purchase" additional leisure. Generally the effect of wealth on retirement is difficult to estimate empirically since observing greater wealth at older ages may be the result of increased saving over the working life in anticipation of earlier retirement. However, a number of economists have found creative ways to estimate wealth effects on retirement and typically find that they are small. For example, one paper exploits the receipt of an inheritance to measure the effect of wealth shocks on retirement using data from the HRS. The authors find that receiving an inheritance increases the probability of retiring earlier than expected by 4.4 percentage points, or 12 percent relative to the baseline retirement rate, over an eight-year period.

A great deal of attention has surrounded how the financial crisis is affecting retirement decisions, with the conventional wisdom saying that fewer people will retire since their savings have been depleted; however recent research suggests that the opposite may happen. Using data from the HRS, researchers examined trends in defined benefit (DB) vs. defined contribution (DC) pension plans and found that those nearing retirement had only limited exposure to the recent stock market decline and thus are not likely to substantially delay their retirement. At the same time, using data from the Current Population Survey (CPS), another study estimates that mass layoffs are likely to lead to an increase in retirement almost 50% larger than the decrease brought about by the stock market crash, so that on net retirements are likely to increase in response to the crisis.More information tells of how many who retire will continue to work, but not in the career they have had for the majority of their life. Job openings will increase in the next 5 years due to retirements of the baby boomer generation. The Over 50 population is actually the fastest growing labor groups in the US. This might have something to do with the economy, or the fact that this generation is outliving any previous generation and needs a job to entertain them!

A great deal of research has examined the effects of health status and health shocks on retirement. It is widely found that individuals in poor health generally retire earlier than those in better health. This does not necessarily imply that poor health status leads people to retire earlier, since in surveys retirees may be more likely to exaggerate their poor health status to justify their earlier decision to retire. This justification bias, however, is likely to be small. In general, declining health over time, as well as the onset of new health conditions, have been found to be positively related to earlier retirement. Most people are married when they reach retirement age;

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thus, spouse's employment status may affect one's decision to retire. On average, husbands are three years older than their wives in the U.S., and spouses often coordinate their retirement decisions. Thus, men are more likely to retire if their wives are also retired than if they are still in the labor force, and vice versa

Saving for retirement

Retired workers then support themselves either through pensions or savings. In most cases the money is provided by the government, but sometimes granted only by private subscriptions to mutual funds. In this latter case, subscriptions might be compulsory or voluntary. In some countries an additional "bonus" is granted una tantum (once only) in proportion to the years of work and the average wages; this is usually provided by the employer.

The financial weight of provision of pensions on a government's budget is often heavy and is the reason for political debates about the retirement age. The state might be interested in a later retirement age for economic reasons.

The cost of health care in retirement is large, because people tend to be ill more frequently in later life. Most countries provide universal health insurance coverage for seniors, although in the United States many people retire before they become eligible for Medicare at age 65. In 2006, Medicare Part D went into effect, expanding benefits to include prescription drug coverage.

Retirement calculation

For most people, employer pensions, government pensions and the tax situation in their country are important factors, typically taken account of in calculations by actuaries. Ignoring those significant nation-specific factors but not necessarily assuming zero real interest rates, a 'not to be relied upon' calculation of required personal savings rate zprop can be made using a little mathematics. It helps to have a dimly-remembered acquaintance with geometric series, maybe in the form

1 + r + r2 + r3 + ... + rn−1 = (1 − rn)/(1 − r)

You work for w years, saving a proportion zprop of pay at the end of each year. So the after-savings purchasing power is (1-zprop) of pay while you are working. You need a pension for p years. Let's say that at retirement you are earning S per year and require to replace a ratio R repl of your pre-retirement living standard. So you need a pension of (1 – zprop ) Rrepl S, indexed to price inflation.

Let's assume that the investments, after price inflation fprice, earn a real rate ireal in real terms where

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(1+ ireal ) = ((1+inominal))/((1+fprice ) ) (Ret-01)

Let's assume that the investments, after wage inflation fpay, earn a real rate i rel to pay where

(1+ i rel to pay ) = ((1+inominal))/((1+fpay ) ) (Ret-02)

Size of lump sum required

To pay for your pension, assumed for simplicity to be received at the end of each year, and taking discounted values in the manner of a net present value calculation, you need a lump sum available at retirement of:

(1 – zprop ) R repl S {(1+ ireal ) −1+(1+ ireal ) −2 +… ….+ (1+ ireal ) -p}

= (1-zprop ) R repl S {(1 – (1+ireal)-p )/ireal}

Above we have used the standard mathematical formula for the sum of a geometric series. (Or if ireal =0 then the series in braces sums to p since it then has p equal terms). As an example, assume that S=60,000 per year and that it is desired to replace Rrepl=0.80, or 80%, of pre-retirement living standard for p=30 years. Assume for current purposes that a proportion z prop=0.25 (25%) of pay was being saved. Using ireal=0.02, or 2% per year real return on investments, the necessary lump sum is given by the formula as (1-0.25)*0.80*60,000*annuity-series-sum(30)=36,000*22.396=806,272 in the nation's currency in 2008–2010 terms. To allow for inflation in a straighforward way, it is best to talk of the 806,272 as being '13.43 years of retirement age salary'. It may be appropriate to regard this as being the necessary lump sum to fund 36,000 of annual supplements to any employer or government pensions that are available. It is common to not include any house value in the calculation of this necessary lump sum, so for a homeowner the lump sum pays primarily for non-housing living costs.

Size of lump sum saved

Will you have saved enough at retirement? Use our necessary but unrealistic assumption of a constant after-pay-rises rate of interest. At retirement you have accumulated

zprop S {(1+ i rel to pay )w-1+(1+ i rel to pay )w-2 +… ….+ (1+ i rel to pay )+ 1 }

= zprop S ((1+i rel to pay)w- 1)/i rel to pay

Equate and derive necessary saving proportion

To make the accumulation match with the lump sum needed to pay your pension:

zprop S (((1+i rel to pay )) w - 1)/i rel to pay = (1-zprop ) R repl S (1 – ((1+i real)) -p )/i real

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Bring zprop to the left hand side to give our answer, under this rough and unguaranteed method, for the proportion of pay that we should be saving:

zprop = R repl (1 – ((1+i real )) -p )/i real / [(((1+i rel to pay )) w - 1)/i rel to pay + R repl (1 – ((1+i real )) -p )/i real ] (Ret-03)

You are encouraged to download the use-at-your-own-financial-risk spreadsheet. The results in the spreadsheet can be seen to make sense. For example, working for 5 years and drawing a pension for 5 years requires you to save almost half your pay, with interest helping only a little.

Note that the special case i rel to pay =0 = i real means that we instead sum the geometric series by noting that we have p or w identical terms and hence z prop = p/(w+p). This corresponds to our graph above with the straight line real-terms accumulation.

Life after retirement

Retirement might coincide with important life changes; a retired worker might move to a new location, for example a retirement community, thereby having less frequent contact with their previous social context and adopting a new lifestyle. Often retirees volunteer for charities and other community organizations. Tourism is a common marker of retirement and for some becomes a way of life, such as for so called grey nomads.

Often retirees are called upon to care for grandchildren and occasionally aged parents. For many it gives them more time to devote to a hobby or sport such as golf or sailing. On the other hand, many retirees feel restless and suffer from depression as a result of their new situation. Either because of the sudden increase in free time, or because of a decline in their personal health, the newly retired are one of the most vulnerable societal groups when it comes to depression.

Many people in the later years of their lives, due to failing health, require assistance, the highest degree of assistance – in some countries – being provided in a nursing home. Those who need care, but are not in need of constant assistance, may choose to live in a retirement home.