Human resource planning is essentially planning for people in the organisation which basically involves trying to obtain:
- the right people (assess future recruitment needs)
- the right numbers (anticipate and, where possible, avoid redundancies)
- with the right knowledge, skills and experience (formulate training programmes)
- in the right jobs (develop promotion and career development policies)
- in the right place (develop a flexible workforce to meet changing requirements)
- at the right time (assess future requirements for capital equipment, technology and premises)
- at the right cost (control staff costs while ensuring salaries remain competitive)
All these factors are obtained in the key stages of Human resource planning. The first stage is the analysis of current staff in the organisation. This requires an effective system of personnel records and a staffing inventory including, details of gender, age, sex, ethnic origin, disability, job type, title or department, length of service, skill or educational level. Statistical techniques can also be used in the analysis such as: labour turnover; working hours lost due to sickness and absence; rate at which people are promoted; productivity per person; regression analysis; time series analysis; markov analysis of labour flows and rates etc. This first stage of analysis is very important as it defines the "world" in which the organization is planning for its manpower - both externally and internally. It can show ‘gaps’ in capabilities; lack of sufficient skills, people, knowledge etc. It can also show surpluses in capabilities that may provide opportunities for efficiencies and responsiveness – skills, people and knowledge that may be underused, so the organization could consider new opportunities and ventures that would capitalize on these human resources. By doing an analysis on current staff, organizations are able to see if their work force is being utilized efficiently, with knowledge of any known future changes and further availability of key staff.
The second stage of Human resource planning is the analysis of the organization’s future plans. This includes consideration of changes and losses to the organization – replacements for retirements, leavers, transfers and promotions; incremental improvements in staff performance and current programmes of staff development – possible improvements in production, redeployment of existing manpower, planned changes in output levels; and external environmental factors such as the likely availability of labour, areas of potential new developments or markets, and changes in legislation – planned introduction of new methods and equipment, planned reorganization of work, the impact of changes in employment law or collective agreements. Analysis of the organization’s future plans is done in the form of ratio-trend analysis – identifies areas where performance has improved or deteriorated over time; work-study or organization and methods (O&M) techniques - time-study and thorough analysis of the work done to establish the person-hours needed per unit of output; managerial judgment – managers make estimates of labour needs, flows and availabilities, executive reviews, succession planning, vacancy analysis. The second stage shows managers any future emerging trends; the sort of workforce envisaged, the pros and cons of the different routes to get there; projections of numbers of staff required in the future, the utility of retraining, redeployment and transfers, what the appropriate recruitment levels might be. Such an analysis is important to any organization as it shows where the organization wants to be in the future.
The third stage is the analysis of the matches or mismatches between Human resource supply and demand forecasts. This is basically a forecast of staffing requirements, aided by the results of the previous two stages, necessary to achieve corporate objectives by the target date. Forecasting of employee supply is concerned with predicting how the current supply of manpower will change over time, primarily in respect of how many will leave, but also how many will be internally promoted or transferred. These changes are forecast by analyzing what has happened in the past, in terms of staff retention and/or movement, and projecting this into the future to see what would happen if the same trends continued. This stage is very important in the Human resource planning process as it identifies critical shortfalls – organization’s can then recruit to meet a shortage of those with senior management potential; allow faster promotion to fill immediate gaps; develop cross functional transfers for high flyers; hire on fixed-term contracts to meet short-term skills/experience deficits. It also shows any surplus of labour – allowing organizations to reduce staff numbers to remove blockages or forthcoming surpluses.
The fourth stage is evaluating options if there were to be too many staff or to few staff in a given work area. If there were too many staff managers would have to consider natural wastage, redundancy (voluntary and compulsory), redeployment (including training, if needed), early retirement, dismissal, a freeze on future recruitment, part-time working or job sharing, elimination of overtime, move to more labour intensive methods or products, search for additional or new work. If there were too few staff managers would have to consider recruitment, redeployment, promotion or demotion, extension of the contracts of those about to retire, use of freelance, agency or temporary staff, overtime, productivity bargaining, automation or elimination of jobs, increase capital investment to increase productivity e.g. by introduction of new technology. This stage lets managers know what to expect in the future if these situations arise.
The fifth and final stage is the selection of best alternatives and implementation of the human resource plan with monitoring and review procedures. Each plan developed by each organization will be unique because it will address and be dependent upon different issues. The implementation of the plan should be assessed regularly as part of the overall review of objectives. It serves as a tool to direct, manage and reinforce actions within the organization to address key management issues. Once prepared, its implementation and the subsequent monitoring of results are essential to addressing the issues effectively.
Most organizations want Human resource planning systems which are responsive to change with assumptions being easily modified, that allow flexibility in supply and are simple to understand and use and not too time demanding. However to operate such systems, organizations need appropriate demand models, good monitoring and corrective action processes and an understanding on how resourcing works in the organization. If HRP techniques are ignored, decisions will still be taken, but without the benefit of understanding their implications.
BIBLIOGRAPHY
Management and Organizational Behaviour, Laurie J. Mullins, 7th edition
Human Resource Management, Derek Torrington, Laura Hall & Stephen Taylor
College Handouts
www.manpowerplanning.co.uk
