The HR Planning Process 1.Situation analysis or Enviromental Scanning 2.Forecasting Demand for human Resources 3.Analysis of the supply of human resources. 4.Development of plans for action.

1. HUMAN RESOURCE PLANNING IN
CHANGING CONTEXT
PRESENTEDBY:SWATI NIGAM

2. The HR Planning Process
 1.Situation analysis or Enviromental Scanning
 2.Forecasting Demand for human Resources
 3.Analysis of the supply of human resources.
 4.Development of plans for action.

3. Situation Analysis and
Enviromental Scanning
 The first stage of HR planning is the point at
which HRM and strategic planning initially
interact.
 The strategic plan must adapt to enviromental
circumstances,and HRM is one of the primary
mechanisms that an organization can use during
the adaptation process.
 For example,rapid technological changes in
theenviroment can force an organization to
quikly identify and hire employees with new
skills that previously weren’t needed by the
organization.

4. Forecasting Demand for
Employees
 The next phase of an effective HR planning
process is estimating not only how many but
also what kinds of employees will be needed.
 Forecasting yields advance estimates or
calculation’s of the organization’s staffing
requirements.
 Although many quantitative tools can help in
forecasting,it involves a great deal of human
judgement.

5. The Expert Estimates
 The least mathematically sophisticated
approach to employement forecasting is for an
“expert” or group of experts to provide the
organization with demand estimates based on
expierience,guesses,intuation,and subjective
assesments of availabl economic and labor force
indicators.
 Concerns over a single individual’s ability to
provide accurate estimates of such complex
issues led to the development of the dElphi
Technique.

6. Nominal Group Technique
 Another group-based judgement forecasting
method is called the nominal group
technique(NGT).
 Individual generation of estimates is followed
by group brainstorming sessions in the hope
of generating one group decision that is
preferred over any of the individual decisions.
 NGT can be an effective forecasting tool for
enviroments and problems more complex
than an individual can master.

7. Trend Projection
 The second top down technique develops a
forecast based on a past relationship
between a factor related to employment and
employment itself.
 For example,in many businesses ,sales levels
are related to employment needs.The planner
can develop a table or graph showing a past
relationship between sales and employment.

8. Modelling and Multiple –
Predictive Techniques
 Analytical formula such as regression
analysis.
 Markov Chain Analysis
 The more advanced approaches relate many
factors to employment such as sales,gross
national product,and discretional income.Or
they mathematically model the organization
and use simulations with methods such as
Markov models and analytical formulations
such as regression analysis.

9.  The use of the Markov chain analysis involves
developing a matrix to show the probability of
an employee’s moving from one position to
another or leaving the organization.
 Markov analysis begins with an analysis of
staffing levels from one period to
another.Suppose that proffesional nursing
employees have shifted from hospital I,II,and III
in the Houston Medical Center Complex.That is
,they quit working in one hospital and went to
work for another in the medical center.

10.  An HR specialist in hospital I is interested in
analysing the human resource shifts that are
occuring between her hospital and hospitals
II and III.
 Exhibit 5-4 illustrates the movement of
nurses.

11. PROBABILITIES OF TRANSITION
HOSPITAL
Hospital I
Hospital II
Hospital III
2003
200
500
300
NURSES LOST
40
50
45
Nurses Retained
160
450
255
PROBABILTY OF RETENTION
160/200=.80
450/500=.90
255/300=.85

12.  The data in Exhibit 5-5 indicate that hospital I
has a probability of .80 of reatining its
nurses,while hospital II has a probabilty of .90
and hospital III has a probability of .85.Both
hospitals II and III have a higher probabilty of
retaining their nursing staff.Therefore,,the HR
specialist in Hospital I needs to study further
the issue why her hospital has lower
probabilty of lower retention .Is this because
of some HRM program ?

13.  Markov analysis can help identify the probabilty
of lower retention,but it does not suggest any
particular solution to the potential problem.
 Regression analysis is a mathematical procedure
that predicts the dependent variable on the
basis of knowledge of factors
 Known as independent variables.When only one
dependent variable on the basis of knowledge of
factors known as independent variables.
 When only one dependent and one independent
variable are studied ,the process is known as
simple linear regression.

14.  Regression analysis is a mathematical
procedure that predicts the dependent
variable on the basis of knowledge of factors
 Known as independent variables.When only
one dependent variable on the basis of
knowledge of factors known as independent
variables.
 When only one dependent and one
independent variable are studied ,the process
is known as simple linear regression.

15.  When there is more than one independent
variable being considered,the technique is
referred to as multiple regression.

16. Unit Demand Forecasting
 The unit(which can be an entire department,a
project team,or some other group of
employees)forecast is a bottom-up approach
to forecasting demand.Headquarters sums
these unit forecasts,and the result becomes
the employment forecast.The unit manager
analyzes the person by person,job by job
needs in the present as well as the future.

17.  In larger organizations,an HR executive at
headquarters who is responsible for the
employment forecast will improve the
forecast will improve the estimates by
checking with the managers in the field.If the
units forecasts their own needs,the HR
executive would sum sum their estimates to
arrive at the forecast.

18. Human Resource Supply
estimates
 The third phase of HR planning is designed to
answer the question,”How many and what
kinds of employees do I currently have in
terms of the skills and training necessary for
the future?”

19. The Skills Inventory
 The major tool used to asses the current supply
of employees is the skills inventory.
 In some organizations,there will be also a
separate inventory just for the managers called a
management inventory.
 Both of these serve the same purpose:to note
what kind of skills,abilities,expieriences,and
training of employees currently have.By keeping
track of these, the organizations can quikly
determine whether a particular skill is available
when it is needed.

20.  Skills inventories are also useful in career
planning ,management development,and
related activities.
 A skills inventory are also useful in career
planning,management development and
related activities.
 A skills inventory is the simplest form is list
of names,characteristics and skills of the
people working in the organization.

21. Contents of the skill
Inventory
 The list of data might be coded
into skills inventories is almost
endless,it must be tailored to the
needs of the organization.

22.  Some of the more common items
include name,employee
number,present location,date of
birth,date of employment,job
clasification,specific skills and
knowledge,education,field of
education(formal education and
courses

23.  taken since leaving
school),knowledge of a foreign
language,personal
qualifications,publications,license
s,patents,hobbies,a supervisory
evaluation of the employees
capabilities,and salary range.

24. Maintaining the Skill
Inventory
 While designing the system is the most difficult
part of developing a skills inventory,planning for
the gathering,maintaining,handling,and
updating of the data is also important.
 The two principal methods for gathering the
data are the interview and the questionnaire.The
questionnaire is faster and less expensive when
many employees are involved, but inaccuracies
often prevail. People often do not spend enough
time on a questionnaire.

25. Actions Decisions in Human
Resource Planning
 After the HR planning system has analysed
both the supply of the demand for future
workers,these two forecasts are compared
to determine what,if any,action should be
taken.Whenever thee is dicrepency
between two estimates,the organization
needs to choose a couse of action to
eliminate the gap.

26. Action decisions with a
shortage of employees
 When employment specialists
comparing demand with supply find that
the supply of workers is less than the
demand, several possibilities are open to
the organization. If the shortage is small
and employees are willing to work
overtime, it can be filled with present

27.  employees.If there is a shortage
of highly skilled
employees,training and
promotions of present
employees,together with the
recruitment of less skilled
employees,are possibilities,are
possibilities.

28.  Intense global competition, rapid
technological change, and fears
caused by recent workforce
reductions have also led many
organizations to increase their use of
part time workers,sub contractors and
independent professionals in
response to the changing demands.

29. Action Decision in Surplus
conditions
 When comparision of demand for and supply
of employees indicates asurplus,the
alternative solutions include attrition,early
retirements,demotions,layoffs,and
terminations.

30.  A shortage of raw material such as
fuel or a poorly marketed product can
cause an organization to surplus of
employees.
 As a first approach to dealing with
surplus,most organizations avoid
layoffs by relying on atrrition,early
retirement,and creation of work,and
the like.

31.  Simplest method of reduction of work force is
 Early retirement of the employees and
attrition .
 Attrition is leaving the organization.
 Sometimes this approach is accelarated by
encouraging employees close to retirement
to leave early,but there are drawbacks to this
approach if the early retirement plan is not
carefully planned.

32.  Also,large amount of retirements are
expected to lead to skill shortages that will
negatively effect companies ability to
compete in the global marketplace.