Human Resource

Planning

Definition of HRP
Human resource planning can be defined
as the process of ensuring the right number
of qualified people,into the right job at the
right time to deliver the results in an
efficient and effective manner.

Human Resource Planning (HRP)

Is

the first component of HRM strategy

All

other functional HR activities are derived from and

flow out of the HRP process.

Has

its basis in considerations of future HR

requirements in light of present HR capabilities and
capacities.

Is

proactive in anticipating and preparing flexible

responses to changing HR requirements.

Has

both an internal and external focus.

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Vision: what do we want to create.

Mission: An enduring statement of
distinguishes one company from
companies.

purpose that
other similar

Objective: Accomplishment of mission of an organization

requires the formulation of a no. of objectives.
e.g.: The objective of Hero Honda is to enhance is to
enhance market share.
Goals: goals are derived from objectives. goals are precise,
clear & specific.
e.g.: Goal to achieve the obj. of Hero Honda is to inc.
sales by two lakhs .
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Strategy: Unified course of action to achieve goals.

e.g.: the goal can be achieved by reducing the price by
reducing the production cost.
Or
By improving the production design.
Or
By increasing the fuel efficiency.

HRP and Strategic Planning

Strategic

What human resources are needed and what are

available?

Strategic

Formulation

What is required and necessary in support of human

resources?

Strategic

Analysis

Implementation

How will the human resources be allocated?

Human
Human Resource
Resource
Planning
Planning

Strategic
Strategic
Planning
Planning
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Influence of Strategic Planning on HRP

Strategy

HRP requirement

Expansion: Additional HR of existing categories

Diversification: Additional HR of diff. categories
M&A: Reduction of HR of managerial positions.
Retrenchment: Reduction of HR of almost all the
categories through VRS and other means.

HR Planning Issues
Staffing Questions:
How

do we manage staffing in times of

recession or expansion?

What

impact does technology change, mergers

or relocation have on staffing issues?

Do

we always have the right people in the right

jobs at the right time?

How

do we get our human resources: buy

them or make them or both?
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Major Objectives of HRP

Preventing

understaffing and overstaffing

Ensure

the organisation has the right employees

with the right skills at the right place at the right
time

Ensure

the organisation
changes in its environment

is

responsive

to

Provide

direction and coherence to all HR

activities and systems
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HRP process
1)

Forecasting
Demands)

(future

requirements/

2)

Inventorying(present strength/ supply)

3)

Anticipating(comparison of present and

future requirements)

4)

Planning(necessary programme to meet

future requirements)

Human Resource Planning Model

FORECASTING
FORECASTINGDEMAND
DEMAND

Considerations
Considerations

Techniques
Techniques

Technology
Trend
Technology
Trendanalysis
analysis
Financial
Financialresources
resources Managerial
Managerial
estimates
Organizational
Organizationalgrowth
growth estimates
Delphi
Mgmt.
Delphitechnique
technique
Mgmt.philosophy
philosophy

Techniques
Techniques
HR
HRinventories
inventories

External
External
Considerations
Considerations

Wkforce
changes
Wkforce
changes
Replacement
charts
Replacement charts Mobility
Mobility
Succession
SuccessionPlanning
Planning Govt
Govtpolicies
policies
Unemployment
Unemployment
FORECASTING
FORECASTINGSUPPLY
SUPPLY

BALANCING
BALANCING
SUPPLY
SUPPLYAND
AND
DEMAND
DEMAND

(Shortage)
(Shortage)
Recruitment
Recruitment

Full-time
Full-time//Part-time
Part-time

(Surplus)
(Surplus)
Reductions
Reductions

Layoffs
Layoffs
Terminations
Terminations
Demotions
Demotions
Retirements
Retirements

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Quantitative Approach: Trend Analysis

Example of Trend Analysis of HR Demand
BUSINESS
FACTOR
YEAR

(SALES IN 000)

LABOR
PRODTY

(SALES/EMPLOYEE)

HR
DEMAND
(NO. OF EMPLOYEES)

2003 Rs. 3,613

11.12

325

2004 Rs. 3,748

11.12

337

2005 Rs. 3,880

12.52

310

2006 Rs. 4,095

12.52

327

2007 Rs. 4,283

12.52

342

2008 Rs. 4,446

12.52

355
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Qualitative Approaches to
Demand
Forecasting

Management Forecasts

The opinions (judgments) of supervisors, department

managers, experts, or others knowledgeable about the
organizations future employment needs.

Delphi

Technique

An attempt to decrease the subjectivity of forecasts by

soliciting and summarizing the judgments of a preselected
group of individuals.

The final forecast represents a composite group judgment.

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Forecasting Supply of Employees:

Internal Labor Supply
Staffing

Tables

Replacement
Succession

Charts

Planning

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Forecasting Internal Labor Supply

Staffing

Tables

Graphic representations of all organizational jobs, along

with the numbers of employees currently occupying those
jobs and future (monthly or yearly) employment
requirements.

Replacement

Charts

Listings of current jobholders and persons who are

potential replacements if an opening occurs.
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An Executive Replacement Chart

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Existing inventory at a future date is calculated as

follows:
Future supply of HR=present inventory as on today +
Potential additions Potential losses.
Note:
Potential additions: includes transfers, promotions in ,
demotion in & new hires.
Potential losses: includes VRS,death,dismissals,retirement.

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HRP Considerations
Balancing supply
and demand

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Dealing with surplus Manpower.

Retrenchment
Outplacement
Lay-Offs
Leave

of absence without pay

Loaning
Work Sharing
Reduced work hours
Early/ Voluntary retirement
Attrition
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Requisites for Successful HRP

HRP must be seen as equally vital as business planning

Top-management support

Periodic review and revision of the forecasting techniques and

the forecasts

Without long range planning concentration becomes focussed

on short-term needs resulting in crisis management reactions

An excellent and up-to-date HRIS

Active involvement of line managers and co-ordination between

line mgrs and HR function
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