Human Resource Planning

“Human resource planning (HRP) is the continuous

process of systematic planning ahead to achieve optimum
use of an organization's most valuable asset—quality
employees. “

“Human resources planning ensures the best fit between

employees and jobs while avoiding manpower shortages or
surpluses.”
There are four key steps to the HRP process.
✓ analyzing present labor supply,
✓ forecasting labor demand,
✓ balancing projected labor demand with supply,
✓ supporting organizational goals.

HRP is an important investment for any business as it

allows companies to remain both productive and
profitable.

VIDEO
 Challenges of Human Resource Planning
The challenges to HRP include forces that are always changing, such
as employees getting sick, getting promoted, or going on vacation.
HRP ensures there is the best fit between workers and jobs, avoiding
shortages and surpluses in the employee pool.
To satisfy their objectives, HR managers have to make plans to do
the following:

✓Find and attract skilled employees.

✓Select, train, and reward the best candidates.
✓Cope with absences and deal with conflicts.
✓Promote employees or let some of them go.
 Human Resource Planning Process

VIDEO
 Human Resource Planning Process
Environment
1) Economic factors
2) Technological Changes
3) Labor market scenario
4) Political and legislative issues
5) Social concerns

Organizational objectives and policies

HR plans need to be based on
organizational objectives.
Eg:
✓Are vacancies to be filled from
promotions from within or hiring from
outside?
✓How to enrich employees job? Should
the routine and boring jobs continue or be
eliminated?
✓How to downsize the organization to
make it more competitive?
 Human Resource Planning Process
HR need or demand forecast
✓ The process of estimating the future
quantity and quality of people required.
✓ The basis of forecast will be annual
budget and long term corporate plans.
✓ Demand forecasting must consider
several factors like ;
Internal
(Budget constraints, employee
separations, production level etc.)
External
(Competition, laws, change in
technology).
Forecasting Techniques
✓Managerial judgment
✓Ratio analysis
✓Work study techniques
✓Delphi technique
✓Trend analysis
✓Group Brainstorming
✓Expert opinion
✓Nominal group technique
 Now Question is….
If Shortage of employees do…?
✓Hire new full-time employees
✓Offer incentives for postponing retirement
✓Re-hire retired employees on part-time basis
✓Attempt to reduce turnover
✓Bring in over-time for present employees
✓Subcontract work to another company
✓Hire temporary employees
 Now Question is….
If surplus of employees is expected do…?
✓Do not replace employees who leave
✓Offer incentives for early retirement
✓Transfer or reassign excess employees
✓Use slack time for employees training or equipment
maintenance
✓Reduce work hours
✓Lay off employee

Continue in Next chapter 2.2…