In simple words, HRP is understood as the process of forecasting an organizations future demand for, and supply of, the right type of people in the right number. After this only the HRM department can initiate the recruitment and selection process Its called by manpower planning, personal planning or employment planning
• It includes the estimation of how many qualified people are necessary to carry out the assigned activities, how many people will be available, and what, if anything, must be done to ensure that personal supply equals personnel demand at the appropriate point in the future.• Basically it’s the process by which an organization ensures that it has the right number & kind of people, at the right place, at the right time, capable of effectively & efficiently completeing those tasks that will help the organisation achieve its overall objectives.
1. FUTURE PERSONNEL NEEDS • Surplus or deficiency in staff strength • Results in the anomaly of surplus labour with the lack of top executives1. COPING WITH CHANGE • Enables an enterprise to cope with changes in competitive forces, markets, technology, products & government regulations1. CREATING HIGHLY TALENTED PERSONNEL • HR manager must use his/her ingenuity to attract & retain qualified & skilled personnel • Succession planning1. PROTECTION OF WEAKER SECTIONS • SC/ST candidates, physically handicapped, children of the socially disabled & physically oppressed and backward class citizens.
5. INTERNATIONAL STRATEGIES • Fill key jobs with foreign nationals and re- assignment of employees from within or across national borders6. FOUNDATION FOR PERSONNEL FUNCTIONS • Provides information for designing & implementing recruiting, selection, personnel movement(transfers, promotions, layoffs) & training & development7. INCREASING INVESTMENTS IN HUMAN RESOURCES • Human assets increase in value8. RESISTANCE TO CHANGE AND MOVE • Proper planning is required to do this
9. OTHER BENEFITS • Upper management has a better view of the HR dimensions of business decision • More time is provided to locate talent • Better opportunities exist to include women & minority groups in future growth plans • Better planning of assignments to develop managers can be done
I. TYPE & STRATEGY OF ORGANISATION Internal growth Growth through M & A Informal Formal Reactive Proactive Inflexible Flexible
II. ORGANIZATIONAL GROWTH CYCLES & PLANNING • Embryonic stage – No personnel planning • Growth stage – HR forecasting is essential • Maturity stage – Planning more formalized & less flexible • Declining stage – Planning for layoff, retrenchment & retirementIII. ENVIRONMENTAL UNCERTAINITIES • Political, social & economic changes • Balancing programmes are built into the HRM programme through succession planning, promotion channels, layoffs, flexi time, job sharing, retirement, VRS, etc….
IV. TIME HORIZONS • Short-term & Long-term plansV. TYPE & QUALITY OF FORECASTING INFORMATION • Type of information which should be used in making forecastsVI. NATURE OF JOBS BEING FILLED • Difference in employing a shop-floor worker & a managerial personnelVII. OFF-LOADING THE WORK
ENVIRONMENT ORGANISATIONAL OBJECTIVES AND POLICIES HR NEEDS FORECAST HR SUPPLY FORECAST HR PROGRAMMING HRP IMPLEMENTATATION CONTROL AND EVALUATION OF PROGRAMME SURPLUS SHORTAGERESTRICTED HIRING RECRUITMENT REDUCED HOURS AND SELECTIONVRS, LAY OFF, etc THE HRP PROCESS
HR plans need to be based on Organizational Objectives. The role of HRP is to subserve the overall objectives by ensuring availability and utilization of Human Resources. In developing these objectives, specific policies need to be formulated to address the following questions: Are vacancies to be filled from promotions from within or hiring from outside? How do training and development objectives interfere with the HRP objectives? What union constraints are encountered in HRP and what policies are needed to handle these constraints? How to enrich employees job? Should the routine and boring jobs continue or be eliminated? How to downsize the organization to make it more competitive?
Demand forecasting is the process of estimating the future quantity and quality of people required. The basis of the forecast must be the annual budget and long-term corporate plan, translated into activity levels for each function and department
Demand forecasting must consider several factors both internal and external. Among external factors are competition(foreign and domestic), economic climate, laws and regulatory bodies, changes in technology and social factors. Internal factors include budget constraints, production levels, new products and services, organizational structure and employee separation.
Demand forecasting helps to : Quantify the jobs necessary for producing a given number of goods Prevent shortage of people where and when they are needed most Determine what staff-mix is desirable in the future Monitor compliance with legal requirements with regard to reservation of jobs Asses appropriate staffing levels in different parts of the organization so as to avoid unnecessary costs
Managerial judgement Ratio-trend analysis Work study techniques Delphi technique Flow models Other techniques
In this all managers sit together, discuss and arrive at a figure which would be the future demand for labour. This technique may involve a ‘bottom-up’ or ‘top-down’ approach. A combination of both could yield positive results.
This is the quickest forecasting technique. This technique involves studying past ratios, say, between the number of workers and sales in an organization and forecasting future ratios, making some allowance for changes in the organization or its method.
Work study techniques can be used when it is possible to apply work measurement to calculate the length of operations and the amount of labour required.
• This technique is the method of forecasting personnel needs.• It solicits estimates of personnel needs from a group of experts, usually managers.• The HRP experts act as intermediaries, summarize the various responses and report the findings back to the experts.• Summaries and surveys are repeated until the experts opinion begin to agree.
Supply forecasting measures the no ofpeople likely to be available from within andoutside an organisation,after makingallowance for absenteeism, internalmovements and promotions, wastage andchanges in hours and other conditions ofwork.
Quantify no of people and positions expected in near future. Clarify the staff mixes. Prevent shortage of people Asses present staffing levels in different parts of organization.
Existing human resources Internal sources of supply External sources of supply
• Skill inventories – info about non-managers. 1. Personal data 2. Skills 3. Special qualifications 4. Salary and job history 5. Company data 6. Capacity of individual 7. Special preference of individual
• Management inventories 1. Work history 2. Strengths 3. Weakness 4. Promotion potential 5. Career goals 6. Personal data 7. Number and types of employees supervised 8. Total budget managed 9. Previous management duties.
HR planning and analysis Equal employment Staffing HR development Compensation and benefits Health,saftey and security Employee and labor relations
Inflows and outflows IS= current supply – outflow + inflow Turnover rate No of seperations during one year × 100 Avg no of employees during the year
Conditions of work and absenteeism. Absenteeism is given by no of persons – days lost ×100 Avg no of persons × no of working days Productivity level Movement among jobs
New blood and new experience To replenish old personnel Organizational growth and diversification
After personal demand and supply are forecast the vacancies should be filled at right time with right employees.
Converting HR plan into action. Action programmes are.. Recruitment Selection & placement Training and development Retraining & redeployment The retention plan The redundance plan The succession plan
Recruitment Selection & placement IfShortage of employees - Do-Hire new full-time employeesOffer incentives for postponing retirementRe-hire retired employees on part-time basisAttempt to reduce turnoverBring in over-time for present employeesSubcontract work to another companyHire temporary employeesRe-engineer to reduce needs
If surplus of employees is expected -Do-Do not replace employees who leaveOffer incentives for early retirementTransfer or reassign excess employeesUse slack time for employees training or equipment maintenanceReduce work hoursPay off employee
It covers no. of trainees required It necessary for existing staff Identification of resource personal for conducting development programmes Frequency of training and development programmes Budget allocation
Retraining and redeployment: New skill should be imported to existing employee Retention plan: Compensation plan Performance appraisal Employees leaving in search of green pastures The induction criss Shortages Unstable recruits
Who is to be redundant and where and when Plans for re-development or re-training Steps to be taken to help redundant employees finding new jobs Policy for declaring redundancies Programme for consulting with unions or staff associations
Analysis of demand Audit of existing executives Planning of individual career path Career counseling Accelerated promotions Performance related training and development Planned strategic recruitment Filling the openings
Establish the reporting procedures Identifying who are in post and those who are in pipe line It should report employment costs against budget and trends in wastage and employment ratios
Institute of Applied Manpower Research Requisites for successful HRP Recognize of corporate planning Backing of top management for HRP HRP responsibilities should be centralized Personnel record must be complete, up-date and readily available The time horizon of plan should be long for remedial action The techniques of planning should be best suit Plans should be prepared by skill level Data collection, analysis, techniques of planning should be constantly revised
People question the importance of making HR practices future oriented and role assigned to HR practitioners in formulation of organizational strategies HR practitioners are perceived as expert in handling personnel matters, but are not experts in managing business. HR information often is incompatible with the information used in strategy formulation. Conflicts may exist between short term and long term HR needs. Conflicts between quantitative and qualitative approaches to HRP. Non-involvement of operating managers renders HRP ineffective.