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H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
H U M A N  R E S O U R C E  P L A N N I N G
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  • 1. Certificate in Industrial Relations  Manpower Planning versus Human Resource Planning  Need for Human Resource Planning  Steps involved in Human Resource Planning 1
  • 2. MANPOWER 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 various steps. 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 market. 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 2
  • 3. “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 PLANNING PLANNING 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 organisation. 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. 3
  • 4. 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 circumstances. 4
  • 5. 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 arrangements. 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 REQUIREMENTS 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 competition. Forecasting provides the basic premises on which manpower planning is built. Forecasting is important for a number of factors such as : coping with business 5
  • 6. 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 few years. 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 6
  • 7. 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 market. 7