ACQUIRING HUMAN
UNIT – 2
RESOURCES
HUMAN RESOURCE
PLANNING
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Human Resource Planning
“An effort to anticipate future business
and environmental demands upon
and organization and to provide
personnel to fulfill that business and
satisfy that demand”
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HUMAN RESOURCE PLANNING
Definition: It is the process by which management
determines how an organisation should move from its
current manpower position to its desired manpower
position. Through it management strives to have the
right number and the right kind of people at the right
places, at the right time, doing things which result in
both the organisation, and the individual receiving,
maximum long-rang benefit”
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Purpose of HR Planning
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Strategic Planning
The process by which top
management determines
overall organizational
purposes and objectives and
how they are to be
achieved.
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Strategic Importance
Human resources management (HRM): the
philosophies, policies, and practices that an
organization uses to affect the behaviors of
people who work for the organization
Strategic use of HRM activities can improve
organizational effectiveness
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Objectives of HRP
To ensure optimum use of To estimate cost of Hr and
existing HR Housing needs of Employees
To forecast future To provide a basis for MDP
requirements for HR To facilitate productivity
Bargaining
To provide control
To meet the needs of
measures Expansion and
To link HRP with Diversification programmes
Organizational Planning To assess shortage and
To determine levels of surplus of Hr
Recruitment and Training
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Need and Importance of HRP
To carry on its work and HRP is useful in
to achieve its objectives anticipating Cost of HR
HRP identifies gaps which facilitates
There is need to replace budgeting easier
employees HRP facilitates Career
HRP facilitates expansion and succession
and growth planning
HRP helpful in effective HRP helps in planning
utilization of for physical facilities like
HR and Technology canteen staff quarters
etc
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Why HRP gained so much
focus in recent times…
Employment situation Lead time
Technological Changes Hiring costs
Organizational Changes Increased Mobility
Demographic Changes
Shortage of Skills
Legislative Controls
Pressure Groups
Systems Concepts
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Human Resource
Planning
Assessing Future
Assessing Current
Human Resource
Human Resources
Needs
Developing a
Program to Meet
Needs
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Human Resource Planning
Strategic
Strategic
Formulation
Implementation
SWOT tells us Deploying
how well our human
workforce is capital is one of
deployed ‘musts’ of
strategic
implementation
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HR PLANNING PROCESS
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Scanning the External
Environment
Environmental Scanning
The process of studying the environment of the
organization to pinpoint opportunities and threats.
Environment Changes Impacting HR
Governmental regulations
Economic conditions
Geographic and competitive concerns
Workforce composition
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Internal Assessment of the
Organizational Workforce
Auditing Jobs and Skills
What jobs exist now?
How many individuals are performing each
job?
How essential is each job?
What jobs will be needed to implement
future organizational strategies?
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Process of HRP
1. Analyzing Organizational Plans
2. Forecasting Demand for HR
3. Forecasting supply of HR
4. Estimating Manpower Gaps
5. Action Planning
6. Monitoring and Control
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The HRP Process
How many?
Strategic plans &
What
Organizational design
quality?
Where?
Resultant
Labor Demand Forecasti
ng
1. Current
Current supply (internal) supply
2. Surplus / shortage?
situation
(internal & external)
Staffing plans Implementati
on 17
HRP Process
Organizational
Objectives
HR Needs HR Supply
Forecast Forecast
HR Programming
HRP
Implementation
Control &
Evaluation
Surplus - Restricted Shortage - Recruitment
Hiring, Lay Off, VRS, & Selection
Reduced Hours
Human Resource Planning Process
External Environment
Internal Environment
Strategic Planning
Human Resource Planning
Forecasting Comparing Forecasting
Human Requirements Human Resource
Resource Availability
Requirements and Availability
Demand = Surplus of Shortage of
Supply Workers Workers
No Action Restricted Hiring, Recruitment
Reduced Hours,
Early Retirement, Selection
Layoff, Downsizing
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Demand for Labor
Strategy / Design
Primary demand for labor
Demand for X number of employees,
of certain types / quality, in
particular parts of organisation
Short term Long term
(static) (fluid)
demand demand
Forecasting
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Labour Supply
Current supply
Assess internal supply against
demand
Forecasted supply
Based on current supply,
is there a shortage / surplus?
Staffing plans
Shortage:
Surplus:
•Overtime
•Downsizing
•Outsourcing
•Transfers
•Retrained transfers
•Work sharing
•New hires
•Retirement
•Technological innovation
•Natural attrition
•Retraining
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Forecasting HR Supply and Demand
Forecasting
The use of information
from the past and present
to identify expected
future conditions.
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Forecasting HR Supply and Demand …
Forecasting Methods
Judgmental
Estimates—asking managers’ opinions, top-down
or bottom-up
Rules of thumb—using general guidelines
Delphi technique—asking a group of experts
Nominal groups—reaching a group consensus in
open discussion
Ratio trend analysis
Regression analysis
Work study techniques
Delphi technique
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Forecasting HR Supply and Demand
Forecasting Periods
Short-term—less than one year
Intermediate—up to five years
Long-range—more than five years
Forecasting the Supply for Human Resources
External Supply
Internal Supply
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Forecasting HR Supply and
Demand
Forecasting the Demand for Human Resources
Organization-wide estimate for total demand
Unit breakdown for specific skill needs by number and
type of employee
Develop decision rules (“fill rates”) for positions to
be filled internally and externally.
Develop additional decision rules for positions
impacted by the chain effects of internal
promotions and transfers.
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Forecasting HR Supply and
Demand
Forecasting External HR Supply
Factors affecting external
Individuals entering and leaving the workforce
Individuals graduating from schools and colleges
Changing workforce composition and patterns
Economic forecasts
Technological developments and shifts
Actions of competing employers
Government regulations and pressures
Other factors affecting the workforce
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Managing Human Resource
Surplus or Shortage
Workforce Reductions and the WARN Act
Identifies employer requirements for layoff advance
notice.
60-day notice to employees and the local
community before a layoff or facility closing
involving more than 50 people.
Does not cover part-time or seasonal workers.
Imposes fines for not following notification
procedure.
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Managing Human Resource Surplus or Shortage
Workforce Realignment
“Downsizing”, “Rightsizing”, and “Reduction in
Force” (RIF) all mean reducing the number of
employees in an organization.
Causes
Economic - weak product demand, loss of market share to competitors
Structural - technological change, mergers and acquisitions
Positive consequences
Increase competitiveness
Increased productivity
Negative consequences
Loss of specialized skills and experience
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Loss of growth and innovation skills
Managing Human Resource Surplus or Shortage
Downsizing approaches
Attrition and hiring freezes
Not replacing departing employees and not hiring new employees.
Early retirement buyouts
Offering incentives that encourage senior employees to leave the
organization early.
Layoffs
Employees are placed on unpaid leave until called back to work
when business conditions improve.
Employees are selected for layoff on the basis of their seniority or
performance or a combination of both. 29
Assessing HR Effectiveness
Diagnostic Measures of HR Effectiveness
HR expense per employee
Compensation as a percent of expenses
HR department expense as a percent of total expenses
Cost of hires
Turnover rates
Absenteeism rates
Worker’s compensation per employee
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HR
Evaluation
Process
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Assessing HR Effectiveness
HR Audit
A formal research effort that evaluates the current state of HR management in an
organization
Audit areas:
Legal compliance (e.g., Legal Audits, ISO etc)
Current job specifications and descriptions
Valid recruiting and selection process
Formal wage and salary system • Benefits
Employee handbook
Absenteeism and turnover control
Grievance resolution process
Orientation program • Training and development
Performance management system
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Using HR Research for Assessment
HR Research
The analysis of data from HR records to determine the
effectiveness of past and present HR practices.
Primary Research
Research method in which data are gathered first-hand for the
specific project being conducted.
Secondary Research
Research method using data already gathered by others and
reported in books, articles in professional journals, or other
sources.
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HR Performance and
Benchmarking
Benchmarking
Comparing specific measures of
performance against data on those
measures in other “best practice”
organizations
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JOB ANALYSIS
&
HUMAN RESOURCE
PLANNING
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Definitions
Job - Consists of a group of tasks that must
be performed for an organization to achieve
its goals.
Position - Collection of tasks and
responsibilities performed by one person;
there is a position for every individual in an
organization.
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Job Analysis
A Basic Human Resource Management
Tool
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Human Resource
Tasks Responsibilities Duties Planning
Recruitment
Selection
Training and
Job
Development
Descriptions
Job Performance Appraisal
Analysis Compensation and
Job
Specifications Benefits
Safety and Health
Employee and Labor
Relations
Knowledge Skills Abilities Legal Considerations
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Definitions
Job analysis - Systematic process of
determining the skills, duties, and
knowledge required for performing jobs in
an organization.
Job description – document providing
information regarding tasks, duties, and
responsibilities of job.
Job specification – minimum qualifications
to perform a particular job.
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Job Analysis
Job analysis is a formal and detailed study of jobs
It refers to a scientific and systematic analysis of a job in
order to obtain all pertinent facts about the job
It is essentially a process of collecting and analyzing all
pertinent data relating to a job
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Objectives of Job Analysis
Job Redesign
Work Standards
Recruitment
Selection
Training
Performance appraisal
Job evaluation
Safety
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Benefits of Job
Analysis
1. Organizational Design
7. Career Path planning
2. Human Resource Planning
3. Recruitment and Selection 8. Job Design
4. Placement and Orientation 9. Job Evaluation
5. Training and Development 10 Labor Relation
6. Performance Appraisal 11. Employee Counseling
12. Health and Safety
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The process of Job Analysis
1. Organisational Analysis
2. Organising Job Analysis Programme
3. Deciding the uses of Job Analysis Information
4. Selecting Representative Jobs for analysis
5. Understand Job Design
6. Collection of Data
7. Developing a Job Description
8. Preparing a Job Specification
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Differentiate between
Job Description Job Specification
Job Description is a Job specification is a
functional description of statement of the minimum
what the job entails. And acceptable human qualities
define the purpose and required for the proper
scope of a job. It is a performance of a job.
written record it contains
title, location, duties,
responsibilities, working It includes physical,
conditions, hazards and mental, social,
relationship with other psychological and
jobs. behavioral characteristics
of a person
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Job Evaluation
Job evaluation is “the process of analysis and
assessment of jobs to ascertain reliably their
relative worth using the assessment as the
basis for a balanced wage structure.”
Job evaluation begins with job analysis and
ends up with the classification of jobs
according to their worth. A job cannot be
evaluated unless and until it is analyzed.
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Job evaluation is aimed at determining a job’s
relative worth. It is a formal and systematic
comparison of jobs to determine the worth of one
job relative to another, and eventually result in a
wage or salary structure or hierarchy.
The basic principle of job evaluation is that:- Jobs
that require greater qualifications, more
responsibilities, and more complex job duties
should be paid more highly than jobs with lesser
requirements.
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Objectives of Job evaluation
1. To Determine equitable wage differentials between
different jobs in the organization
2. To eliminate wage inequities
[Link] develop a consistent wage policy
4. To provide a framework for periodic review and
revision of wages
5. To provide a basis for wage negotiations
6. To enable management to gauge and control the payroll
costs
7. To minimize wage descriptions on the basis of age, sex,
caste, region, religion , creed etc 47
Preparing for the job evaluation
Identify the need for job evaluation should
not be difficult
Getting employees to cooperate in the
evaluation of their jobs.
Choose a job evaluation committee.
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End of this chapter …
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