Course Code HRM 406

Course Title Human Resource Planning & Policy

Impact of Human Resource Planning & Policy on
Assignment Topic
Organizational Performance

Exam’s Name Midterm Examination

Student’s ID 2001101217

Student’s Name Mst. Habiba khanam

Semester’s Name and Summer 2020

Year
Course Teacher’s Monowara Begum Memy
Name and Designation
Department’s Name Business Administration

Date of Submission July 23, 2020

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This assignment is my own original work. No part of this work has been copied from any
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 Impact of HR Planning & Policy on Organizational Performance

Introduction:
The human resources of an organization consist of all people who perform its activities.
Human resource management is concerned with the personnel policies and managerial
practices and systems that influence the workforce. In broader terms, all decisions that affect
the workforce of the organization concern the HRM function.

Major HRM responsibilities include work design and job analysis, training and development,
recruiting, compensation, team-building, performance management and appraisal, worker
health and safety issues, as well as identifying or developing valid methods for selecting staff.
HRM department provides the tools, data and processes that are used by line managers in
their human resource management component of their job.

The Department of Human Resource Management (DHRM) strives to keep the policies on
this web site current. From time-to-time policies are revised to keep pace with generally
accepted business practices and to comply with changes in state or federal law. Policies under
review will be indicated as such in the index with an asterisk. If the policy you are seeking is
noted as “under review,” you should contact your agency Human Resources Officer or
DHRM’s Agency Human Resource Services (AHRS)Workface management has become
increasingly complex.

The heritage and growth of the human resource management profession is closely linked to
people’s attitudes about work, the evolution of employment-related laws and sociological
trends. The HR field today recognizes the dynamic relationship between strategy, people,
technology and the processes that drive organizations. Although this dynamic relationship
appears obvious now, the evolution of the profession has often been slow. One could argue
that the HR field dates back to the first working arrangements between master craftspeople
and their apprentices.

Before the industrial Revolution, working arrangements involved close relationships between
mentors and apprentices dedicated to learning a particular trade. Apprentices were often
required to live in the shop or home of the master craftsperson. If an apprentice was injured
or sick, the master’s family was responsible for restoring the young worker’s health and
welfare. Master and apprentice shared in good times and bad, in profit and in loss.

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 Impact of HR Planning & Policy on Organizational Performance

The usefulness of this age-old relationship came to an abrupt end with the advent of the
Industrial Age. In one powerful stroke, the notion of work moved from guilds and home
shops to steam-driven factories. The introduction of the assembly line brought a need for
low-skilled employees capable of performing repetitive tasks.

Why adopt HR Policies?

Every organization should have human resource policies as they ensure the following
benefits.

1. The work involved in formulating human resource policies requires that the management
give deep thought to the basic needs of both the organization and the employees the
management must examine its basic convictions as well as give full consideration to the
prevailing practices in other organizations.
2. Established human resource policies ensure consistent treatment of all human resource
throughout the organization. Therefore, favoritism and discrimination are minimized.
3. Continuity of action issued even though top management human resource change. The
manager of a company may possess a very sound human resource management philosophy.
The tenure of office of any manger is finite. But the organization continues. Policies promote
stability.
4. Sound human resource polices help resolve intrapersonal, interpersonal and inters group
conflicts.
5. Human resource polices serve as a standard of performance. Actual results can be
compared with the policy to determine how well the members of the organization are living
up to the professed intentions.

Benefits of Human Resource Planning:

By formulating a well-conceived HRP, some benefits can be accrued by the organization as
well as by the human resource management. These benefits can be summarized in the
following points:

1. Better view of business decision: Upper management has a better view of the human
resource dimensions of business decisions.

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 Impact of HR Planning & Policy on Organizational Performance

2. Minimum cost: HR costs may be lower because management can anticipate imbalances
before they become unmanageable and expensive.

3. Anticipated talent: More time is available to locate talent because needs are anticipated and
identifies before the actual staffing is required.

4. Management development: Proper HRP can ensure the development of managers through
proper training programs.

5. Improved utilization: HRP improve the methods of Utilization of human resource of an

organization.

6. Economy in hiring: Effective HRP can set a system of hiring human resource for the
organization with minimum cost and efforts.

7. Information base: HRP helps in expanding the human resource management information
base to assist other human resource activities and other organization units.

8. Coordination: Coordination of different human resource management programs and

activities is possible with the help of a well-established human resource planning.

9. Technological change: Rapid technological changes make human resource planning more
important as the demand for new skills is increasing.

10. Reduction of wastage: Proper manpower policy will reduce wastage rate. There are two
of wastage – a. voluntary (marriage, pregnancy, immigration, early retirement) and b.
incidental (death, retirement and dismissal).

11. Corporate asset: Manpower planning stresses the value of human resource as corporate
assets.

12. Gradual growth: Interest in manpower planning is increasing because the size of the
organization is gradually increasing.

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 Impact of HR Planning & Policy on Organizational Performance

If human resource manager makes a good plan all activities are expected to be performed
timely and properly and then organization may be benefited in many wags.

Human Resource Planning Method:

There are four methods of formulating human resource planning. These methods are used to
determine the requirements of personnel. By using these methods, human resource planning
unit can formulate an effective human resource plan for the organization.

1. Annual estimate of expected vacancies: By using this method requirements of human

resource for the whole year can be estimated. Thus, organization can also make necessary
arrangement for procuring suitable human resources.

2. Long range estimate of expected vacancies: This method helps the human resource
manager to make a long-range estimate of human resources for the next few years (usually
for more than 3 years).

3. Man specification requirements: By resorting the third method of human resources

planning, human resources needs can be specified for the departments. Not only that human
resource with specific qualification can also be identified by this method.

4. Job requirements: Every job requires separate type of human resource for proper
functioning. This method helps HRP unit/manager in determining job requirement for the
organization.

Human resource manager will examine the organizational structure regularly to anticipate its
manpower requirements. A job analysis must be made to know the requirements of a
particular job.

Components of Human Resource Planning.

Human resource planning has several components. Anthony and his associates have
identified three components of HRP. These components can help the human resource planner
to know the nature of economic forces available in the business and industrial area, latest
position of demand and supply of labor in the market and lastly possibility of skills change

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 Impact of HR Planning & Policy on Organizational Performance

and shortage or surplus of human resources. In the following paragraphs these three
components are briefly discussed:

1. Economic forces: National employment and economic policy planning influence human
resource planning. National economic policy planning set the stage for national policy in
training and education and level of economic activity though monetary and fiscal policy.

2. The labor market: Labor market is the pool of qualified applicants from which a
company can line. The relationship between organizations goes requirements and the
available pool of skill and abilities is typically viewed by manager is as a sequential process
whereby the organization first establishes the best goes structure in terms of job content and
task assignments determine each goes worth in the production process and proceed to hire
develop is a resources that retch this requirement.

3. Skill change and personnel shortage: Change in the labor market have led in skill
shortages as well as oversupply. When the human resources educational skill min differ
significantly from one skill required by employers, personnel shortage develop. Employment
have to be open but cannot find people with the skill needed. Many people who want goes are
not hired because they do not have skill demanded.

Human Resource Planning Model:

Human resource planning model organizations are more or less formulated up to the mark.
They do not usually follow the model of process developed in the foreign countries. Human
resource planning model can be proposed for Bangladeshi organization, which can be
glanced in following diagram:

1.Mission: Every organization should set it mission to improve the Human resource to reach
the mission.

2. Objectives and Goal: After setting the mission objectives, goal must be established
reasonably to reach the mission.

3. Strategy: Some action steps for the fulfillment should be undertaken in order to make the
organization goal oriented.
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 Impact of HR Planning & Policy on Organizational Performance

4. Structure: A structure design showing the function relationship of executive and employees
in the organization should be made.

5. People: A group of people should be deployed for implementing the strategy and achieving
the goal.

6. Follow Up: This is the last stage of Human resource planning system in Bangladesh. In this
stage manpower activities should be properly supervised and following up in accordance with
the mission established. This stage can further help in re-designing the organization mission.

Focus of HRM Department:

“The HRM focus should always be maintaining and, ideally, expanding the customer base
while maintaining, and ideally, maximizing profit. HRM has a whole lot to do with this focus
regardless of the size of the business, or the products or services you are trying to sell.” (Dr.
James Spine, former head of Executive Development at the Tribune Company). HRM is
involved in managing the human resources with a focus on expanding customer base that
gives profit to the company. The bottom line of the company is the focus of the HRM
department as well as the function.

The Activities of Human Resources Management:

The activities performed by HRM professionals fall under five major domains:
(1) Organizational design,
(2) Staffing,
(3) Performance Management and Appraisal,
(4) Employee and Organizational Development, and
(5) Reward Systems, Benefits and Compliance

Acquiring human resource capability should begin with organizational design and analysis.
Organizational design involves the arrangement of work tasks based on the interaction of
people, technology and the tasks to be performed in the context of the objectives, goals and
the strategic plan of the organization.

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 Impact of HR Planning & Policy on Organizational Performance

HRM activities such as human resources planning, job and work analysis, organizational
restructuring, job design, team building, computerization, and worker-machine interfaces fall
under this domain. Recruitment, employee orientation, selection, promotion, and
termination are among the activities that fit into the staffing domain.
The performance management domain includes assessments of individuals and teams to
measure, and to improve work performance. Employee training and development programs
are concerned with establishing, fostering, and maintaining employee skills based on
organizational and employee needs, reward systems, benefits and compliance have to do with
any type of reward or benefit that may be available to employees. Labor law, health and
safety issues and unemployment policy fall under compliance component.

Major Trend Affecting HRM

The following trends have an effect on human resource management function and
department. The importance of HRM increases due to some of them and the practices of
HRM are affected to some extent due to some of them.

1. Increased globalization of the economy.

2. Technological changes and environmental changes.
3. The need to be flexible in response to business changes.
4. Increase in litigation related to HRM.
5. Changing characteristics of the workforce.

Basic Principles of HRM:

✓ Treat people with respect & dignity.
✓ Treat people as adults
✓ Deal with people as complete individuals.
✓ Treat all employees with justice
✓ Rewards should be earned, not given
✓ Provide people with all relevant information.
✓ Make people feel that they are most valuable asset for the organization

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 Impact of HR Planning & Policy on Organizational Performance

Impact of HR Planning & Policies on Organizational Performance:

Organizational performance can be measured through financial stability and productivity, but
when we have to relate human resource planning with the organizational performance,
than we consider some of other variables like efficiency and effectiveness, employee
motivation, job satisfaction, trust on employees (cho, Woods, & Mayer, 2005) Human
resource planning is surrounded by three basic level practices which can increase the
organizational performance:

1) To increase the knowledge, skills and abilities among employees.

2) To enhance their empowerment like giving them employment security and organize some
participation programs for employees.
3) To give them motivation through each incentive means like giving them compensation and
benefits, and also through internal promotion like promoting them with their job status.

The link between HRP and organizational performance:

It is clear from information gathered through interviews and questionnaires that human
resource planning has a positive link with organizational performance. In analyzing the link
between HRP and organizational performance, the researcher interpreted that management
and employees indicated that there was a link between these variables. Respondents indicated
that retention programs which were meant to attract and retain employees played a significant
role in improving organizational performance in the sense that through implementing HRP
methods at the organization such as succession planning, training and development, retention
programs jus to mention a few. The organization was able to attract and retain key employees
due to retention programs.

From the findings it is apparent that HRP has a link with organizational performance because
through human resource planning methods the organization was always prepared for its
future in terms of skills, number of employees and competent people to occupy positions.
Hence problems associated with lack of human resources were curtailed and the organization
was always guaranteed of staff to execute duties. Respondents highlighted that HRP had a
strong connection with organizational performance because through HRP, they were able to
identify training needs and came up with training programs to train and develop employees
on areas that lacked proficiency and improve their capacity to perform and enhance their

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skills, abilities and knowledge. This is important because it improves organizational

performance because employee performance would have improved and as result improves
organizational performance. This on the other hand improved organizational performance
because costs were reduced because there were no accidents, time lost to production etc. and
the organization produced efficiently and effectively meeting production targets.

The successful management of an organization to a larger extent revolves around the way
people in an organization are managed. Human resource planning is a good investment for an
organization and organizational success depends on people, as they are responsible for
driving other resources. Delaney and Huselid (1996:952) argued that HRP methods lead to
improved firm performance by “affecting employee skills, employee motivation, and the
structure of work.” Furthermore, Delery and Shaw (2001) argued that workforce
characteristics mediate the relationship between HRP, HR productivity and organizational
performance. Wright, McMahan, and McWilliams (1994) proposed a model of the
relationship between human resource planning methods, human resource characteristics, and
organizational performance.
The model elaborates that HRP methods, individually and systematically, lead to Skills,
Knowledge, abilities development, human resource motivated, and empowered to do the jobs.
In this model it is proposed that HRP have the most direct influence on the SKAs, motivation,
and empowerment of the human resources. Wright et al, (1994) argues that the relationship
between HRP and organizational performance is not HR planning per se that provide
competitive advantage or effect organizational performance, but rather HR planning affects
characteristics of HR, which in turn affect organizational performance.

Conclusion:
Human resource management is the process of acquiring, training, appraising, and
compensating employees, and attending to their labor relations, health and safety, and
fairness concerns. It’s true that any individual who works in Human Resources must be a
“people person.” Since anyone in this department deals with a number of employees, as well
as outside individuals, on any given day, a pleasant demeanor is a must.

Human resources management is very much important for every business organization.
Human Resources may be the most misunderstood of all corporate departments, but it’s also

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the most necessary. Those who work in Human Resources are not only responsible for hiring
and firing; they also handle contacting job references and administering employee benefits.
Actually, these departments do that work. This department of the organization works with the
employee and the staff and worker. This department deals with their job planning and design,
recruitment, selection, measure their job performance and target their compensation.

References:
Yongmei Liu, James G. Combs, David J. Ketchen Jr., R. Duane Ireland, (2007), “The value
of human resource management for organizational performance”, Business Horizons 50, 503-
511.

Steven J. Mayer, PhD, (2008), “Strategic Human Resource Management practices of high-
performance organizations”, Innovative Human Dynamics.
Ed van Sluijs and Frits Kluytmans, “Business Strategy and Human Resource Management:
Setting the Scene”.

Seonghee Cho, Robert H. Woods, (2005), “Examining the impact of Human Resource
Managements on organizational performances”, Academy of Management.
Intternational Journal of Human Resource Management, 16(5), 633-659

E.E. Lawler, S.A. Mohrman, (2003), “HR as a strategic partner: what does it take to make it
happen?”, Human Resource Planning 26 (3), 15-29.

Javier Martinez and Liz Collins, (2005), “A review of Human Resource issues in the Health
sector”, DFID Health System Resource Centre.

Huselid, M. A. (1995), “The impact of human resource management practices on turnover,

productivity and corporate financial performance”. Academy of Management Journal, 38,
635–670.

Wright, P. M. and Gardner, T. (2003), “The human resource-firm performance relationship:

Methodological and theoretical challenges”. In The new workplace: A guide to the human
impact of modern working practices, (eds) D.

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