Human Resource Planning

Satellite Tutorial – Week 5

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 The Process of Human Resource
Planning
The process through which organisational goals are
translated into human resource goals, concerned with
staffing levels and allocation.
Human resource planning involves forecasting human
resource needs for an organisation, and planning the
necessary steps to meet these needs
The human resource planning process has an emphasis
on the organisational ‘bottom line’, as the human
resources are considered to be a part of the overall
budgeting and management processes of the organisation.

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 Overview of the HRP process

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 Forecasting
Forecasting: attempts to determine the supply and
demand for various types of human resources to
predict areas within the organization where there will
be labor shortages or surpluses
There are three major steps to forecasting:
1. Forecasting the demand for labor
2. Determining labor supply
3. Determining labor surplus or shortage

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 External Labour Supply
For promotion purposes organisations should also
consider external sources of labour supply to
consolidate the strength and availability of its internal
manpower
 Planners should keep abreast of labour market
forecasts including the size of the labour market, the
unemployment rate and the types of people who will
be joining the labour market in due course.
Merits and demerits of external recruitment will be
looked in more detail in our next unit of Recruitment
and Retaining employees

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 Goal Setting and Strategic Planning
The purpose of setting specific numerical goals is to
focus attention on the problem and provide a basis
for measuring the organization’s success in
addressing labor shortages and surpluses.
The goals should come directly from the analysis of
supply and demand.
For each goal, the organization must choose one or
more human resource strategies.
Organizations should retain and attract employees
who provide a core competency (what makes it better
than competitors)
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 Options for Reducing a Labour
Surplus
Options
1 Downsizing
2 Pay reductions
3 Demotions
4 Transfers
5 Work sharing
6 Retirement
7 Natural attrition
8 Retraining

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 Options for Avoiding a Shortage
Option
1 Overtime
2 Temporary employees
3 Outsourcing
4 Retrained transfers
5 Turnover reductions
6 New external recruits
7 Technological innovation

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 Downsizing
The planned elimination of large numbers of personnel
designed to enhance organisational effectiveness.
Workforce reduction
 A type of downsizing strategy, using a cost-cutting approach
emphasising short-term results and redundancies.
Organisational redesign
 Restructuring or delayering of the organisation, with elimination
of functions, layers and work processes.
Systemic change
 A program of organisational cultural change involving all staff.

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 Employing Temporary and Contract
Workers
The most widespread methods for eliminating a labor shortage
are hiring temporary workers and outsourcing work.
 Temporary Workers: Temporary employment is popular with
employers because it gives them flexibility and lowers costs.
Temporary workers may offer benefits not available from
permanent workers such as bringing an objective point of view
to the organization’s problems and procedures and providing a
great deal of experience gained while working in other
organizations.

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 Employing Temporary and Contract
Workers
To benefit from using contract or temporary workers,
organizations must overcome the disadvantages
associated with this type of labor force. One drawback
is that tension often exists between temporary and
permanent employees.
Ways in which organizations can better manage the
situation of contract or temporary workers include:
 Complete downsizing efforts prior to bringing in
temporary workers
• Avoid treating temporary workers as second-class
citizens
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 Program implementation and
Evaluation
Accountability

Authority and resources available to accomplish the

stated goals
Regular progress reports on implementation

Evaluation of results

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