Certificate in Industrial Relations
Manpower Planning versus Human Resource
Need for Human Resource Planning
Steps involved in Human Resource Planning
Manpower Planning is quite an old term used in the HR jargon. John Abraham, views
manpower planning as quantitative, involving forecasting of demand and supply of
labour. By definition Manpower Planning is:
“a process through which management determines how an organisation
moves from its current manpower position to its desired manpower position”
However, manpower planning would also mean “putting the right people in the
right place at the right time at the right price”, and has been mainly concerned with
the forecasting, control and matching supply and demand of human resources involving
Manpower Planning has generally been thought as tactical rather than a long term
strategic activity, requiring rational, utilitarian approach (Legge 1995), where people tend
to be regarded as costs to the organisation. It was basically involved in reconciling an
organisation’s need for labour with the available supply in the local and national labour
However, with changing organisational and market conditions, the term
Manpower Planning shifted to a more complex term involving lots of other issues than
mere reconciliation of demand and supply of labour. Through the evolution of Personnel
Management to Human Resource Management, labour was not looked upon as being a
cost, rather, a valuable asset to the organisation which, in a way should be nurtured and
became popular as ‘human resources’
Human resources have thus been defined as being:
“The efforts, skills or capabilities that people contribute to an employing
organisation to enable it to continue in existence”
Although Marchington and Wilkinson argue that the adoption of new style human
resource management led to merely an expansion of the scope of what was previously
called the Manpower Planning , Bramham claims that manpower planning should not be
confused with Human Resource Planning. According to him, HR Planning is a strategic
activity that emphasises employee commitment, creativity, motivation and development.
HR specialists have defined HR Planning as:
“ the creation of explicit proposals by HR specialists, corporate and line
managers (an sometimes other employees) using specific technologies to enable the
supply or dispensation of human resources necessary for the acceptable
performance and long term survival of an organisation” .
The Human Resourcing task would thus comprise of
“acquiring , selecting , supplying , shaping and sometimes dispensing with human
resources in order to enable an organisation to survive and succeed in the long term”.
Marchington and Wilkinson, having said that HR Planning is a mere expansion of
Human Resource planning, have however demarcated between ‘soft’ and ‘hard’ Human
Resource Planning. The table below gives a summary of their views:
HARD HUMAN RESOURCE SOFT HUMAN RESOURCE
Direct control of employees- regarded as Indirect control of employees- they should
factors which should be managed tightly. be increasingly involved in how tasks
should be carried out.
Akin to manpower planning : Meeting the Widened focus, shaping the culture of the
demand of labour by identifying organisation, fostering a clear integration
appropriate supplies of same in the market. between corporate goals and employee
values, beliefs and behaviours.
Undertaken by personnel specialist in Involves HR specialists and line managers
consultation with line management and also sometimes other employees
Related to HR strategies, aiming at Emphasises strategies and plans by gaining
improving utilisation of human resources. commitment through communication of
Getting employees accept that their company mission, vision, values, plans etc
interests coincide with those of the
Need for Human Resource Planning
Human Resource Planning is deemed necessary for all organisations for one or
the other of the following reasons:
To carry on its work, each organisation needs personnel with the
necessary qualifications, skills, knowledge, work experience and aptitude for work. These
are provided through effective manpower planning.
Since a large number of persons have to be replaced who have grown
old, or who retire, die or become incapacitated because of physical or mental ailments,
there is a constant need for replacing such personnel. Otherwise, the work would suffer.
It is also essential because frequent labour turnover which is
unavoidable and even beneficial because it arises from factors which are socially and
economically sound such as voluntary quits, discharges, marriage , promotions; or factors
such as seasonal and cyclical fluctuation sin business which cause a constant ebb and
flow in the work force in many organisations.
In order to meet the needs of expansion programmes (which become
necessary because of increase in the demand for goods and services by a growing
population , a rising standard of living, which calls for larger quantities of the same
goods and services as also for new goods; the competitive position of a firm which brings
it more business arising from improvements effected in the slump period ; and the rate of
growth of the organisation , human resource planning is unavoidable.
The nature of the present work force in relation to its changing needs
also necessitates the recruitment of new labour. To meet the challenge of a new and
changing technology and new techniques of production , existing employees need to be
trained or new blood injected in an organisation .
Manpower planning is also needed in order to identify areas of surplus
personnel or areas in which there is a shortage of personnel. If there is a surplus, it can be
redeployed, and if there is a shortage, it may be adjusted.
The major objective of human resource planning thus, is to maintain and improve the
organisation’s ability to achieve its goal by developing strategies that will result in
optimum contribution of human resources.
According to Wickstrom , human resource planning consists of a series of
activities . These are:
Forecasting future man power requirements either in terms of
mathematical projections or trends in the economic environment and development in
industry, or in terms of judgemental estimates based upon the future plans of a company.
Making an inventory of present manpower resources and assessing the
extent to which these resources are employed optimally;
Anticipating manpower problems by projecting present resources into
the future and comparing then with the forecast of requirements to determine their
adequacy, both quantitatively and qualitatively.
Planning the necessary programmes or requirement, selection, training
and development, utilisation, transfer, promotion, motivation and compensation to ensure
that future manpower requirements are properly met.
Thus it can be noted that manpower planning consists in projecting future
manpower requirements and developing man power plans for the implementation of the
projections. This planning cannot be rigid or static; it is amenable to modification, review
and adjustments in accordance with the needs of an organisation or the changing
Human resource planning is a doubled edged weapon. If used properly, it leads to
the maximum utilisation of human resources, reduces excessive labour turnover and high
absenteeism; improves productivity and aids in achieving the objectives of an
organisation. If badly used, it leads to disruption in the flow of work, lower production,
less job satisfaction, high cost of production and constant headaches for the management
personnel. Therefore for the success of an enterprise, human resource planning is a very
important function, which can be neglected at its own peril. It is as necessary as planning
for production, marketing or capital investment.
Process of Human Resource Planning
The process of human resource planning is one of the most crucial , complex and
continuing managerial functions which embraces organization development ,
management development , career planning and succession planning .The process has
gained importance with the increase in the size of business enterprises, complex
production technology, and the adoption of professional management techniques. It may
be rightly regarded as a multi step process, including various issues, such as:
DECIDING GOALS OR OBJECTIVES
Human resource planning fulfils individual, organizational, and national goals;
but according to Sikula , “the ultimate mission or purpose is to relate future human
resources to future enterprise needs so as to maximize the future return on investment in
human resources.” In fact, the main purpose is one of matching or fitting employee
abilities to enterprise requirements, with an emphasis on future instead of present
Objectives may be laid down for both short term and/ or long term basis. For
example short term objective may be to hire 25 persons for training. Long term objective
may be to start a new industry, expand market, develop a new product.
ESTIMATING FUTURE ORGANISATIONAL STRUCTURE AND MANPOWER
Management must estimate the structure of the organization at a given point in
time. For this estimate, the number and type of employees needed need to be determined.
Many environmental factors affect same. They include business forecast, expansion and
growth, design and structural changes, management philosophy, government policy , and
Forecasting provides the basic premises on which manpower planning is built.
Forecasting is important for a number of factors such as : coping with business
eventualities ( e.g inflation, wages, prices, costs etc) , expansion and growth of both
business and markets, changing management philosophies as well as technology etc.
Once that the future organisational structures have been established, the next step
is to draw up the requirements of human resources, both for the existing departments
and / or new vacancies. For this purpose a forecast of labour force is needed. Such
information should be gathered from different departments with respect to functional
category, amount needed, hierarchy needed etc. In turn, the personnel department will
help in establishing different required criterias for the structure with respect to
qualification, experience etc.
In determining the requirements of human resources , the expected losses which
are likely to occur through labour turnover due to retirements, dismissals, transfers,
promotion etc should be taken into consideration.
It should be noted that for the purpose of man power planning, the main
dimensions to take into consideration are all employee details i.e. age , experience ,
qualifications, salary details and also job details i.e. job descriptions, number of jobs in
each department etc.
AUDITING HUMAN RESOURCES
Once the human resource needs are estimated, the next step is to determine the
present supply of manpower resources. This is known as skills inventory. A skill
inventory form contains details about each employee’s abilities, work preferences and
other information which indicate his overall value to the company.
Once the present manpower resources are established, the human resource department
can estimate what changes are expected to occur in the present labour force in the next
PLANNING JOB REQUIREMENTS AND JOB DESCRIPTIONS
After having decided how many persons would be needed , it is necessary to
prepare a job analysis, which records details of training , skills, qualifications, abilities,
experience and responsibilities, etc, which are needed for a job. Job analysis includes the
preparation of job descriptions and job specifications.
DEVELOPING HUMAN RESOURCE PLAN
This step refers to the development and implementation of the human resource
plan, which consists in finding out the sources of labour supply with a view to making an
effective use of these sources. The first thing, therefore is to decide on the policy – should
the personnel be hired from within through promotional channels or should it be obtained
from an outside source. The best policy which is followed by most organizations is to fill
up vacancies by promotion and lower level promotions by recruitment from the labour