Importance of Human Resource Planning Show
Human Resource Planning is a set of activities undertaken to forecast an organization’s labor demand or requirements and internal labor supply, to compare these projections to determine employment gaps and to develop action plans for addressing these gaps. It aims at fulfilling the objectives of manpower requirement. It helps to mobilize the recruited resources for the productive activities. The human resource planning is and important process aiming to link business strategy and its operation. It is a task that identifies present and future human resources need for a company to achieve their goals. The importance of human resource planning are as follows:
Human resource planning measures that the organization acquires and utilizes the manpower effectively to achieve objectives. Human resource planning helps in assessing and recruiting skilled human resource. It focuses on the optimum utilization of human resource to minimize the overall cost of production.
Human resource planning ensures that people are available to provide the continued smooth operation of an organization. It means, human resource planning is regarded as a tool to assure the future availability of manpower to carry on the organizational activities. It determines the future needs of manpower in terms of number and kind.
Another purpose of HR planning is to recruit and select the most capable personnel to fill job vacancies. It determines human resource needs, assesses the available HR inventory level and finally recruits the personnel needed to perform the job.
Human resource planning is important to cope with the change associated with the external environmental factors. It helps to assess the current human resources through HR inventory and adapts it to changing technological, political, socio-cultural, and economic forces.
Human resource planning identifies the skill requirements for various levels of jobs. Then it organizes various training and development campaigns to impart the required skill and ability in employees to perform the task efficiently and effectively.
This is associated with reducing the impact of uncertainty which is brought about by unsudden changes in processes and procedures of human resource management in the organization. Information Source:
The Human Resource Planning Process describes how management determines how to move the organization from its current manpower position to its desired manpower position. By planning, management aims to improve both the organization and the individual’s long-term success, by putting in place the right actions at the right time. HRP simply refers to forecasting an organization’s future demand for and supply of the right type and number of people. The HRP process is therefore concerned with identifying manpower needs and formulating a plan to meet them. Phases of Human Resource Planning
Nature of Human Resource PlanningHuman resource planning analyzes and identifies the available and necessary human resources in order for an organization to accomplish its objectives. A key objective of HR planning is to ensure that the organization has the appropriate number of human resources, with the appropriate skills, at the appropriate time, and in the right place. A human resource planning process must examine the availability and allocation of people to jobs over a long period of time, which does not just apply to the next month or to the next year. Human resource planning is an integral part of an organization’s overall planning. There are a variety of ways to reduce employee numbers, including shifting employees to other jobs within the organization, laying off employees, developing current employees, or increasing the number of employees in certain areas. There should be a consideration of the knowledge, skills, and abilities of the current employees, as well as the anticipated vacancies resulting from retirements, promotions, transfers, and discharges. HR professionals working with managers and executives must work together to accomplish HR planning. Objectives of Human Resource Planning1) To ensure optimal utilization of existing human resources in the organization.
Need for HRP in Organizations1) Employment-Unemployment SituationAlthough the number of educated unemployed is on the rise, there is an acute shortage for a variety of skills. Therefore, recruitment and retention efforts must become more effective. 2) Technological ChangeThere has been an extensive and rapid change in manufacturing technologies, marketing methods, and management methods. These changes have profoundly affected job content and context. There have been problems with redundancy, retention, and redeployment as a result of these changes. These factors suggest that manpower needs should be planned intensively and systematically. 3) Demographic ChangeHRP is affected by the changing profile of the work force in terms of age, gender, literacy, technical inputs, and social background. 4) Skill ShortageIn the absence of unemployment, the labour market does not become a buyer’s market. The complexity and scarcity of specialist skills in organizations tend to increase as organizations become more complex. Leaving employees with such specialized skills creates a problem for an organization. 5) Governmental InfluencesOrganizations have become involved in systematic HRP as the result of government control and regulatory changes addressing affirmative action for disadvantageous groups, working conditions and hours, child labor restrictions, causal employment, etc. 6) Legislative Control“Hire and fire” policies have been abolished. In the present day, legislation makes it difficult for an organization to reduce its size quickly and cheaply. As a result of recent changes in labour law relating to layoffs and closures, it is easy to increase but difficult to decrease the number of employees. The person responsible for managing manpower must look ahead and try to anticipate manpower problems. 7) Impact of the Pressure GroupIn recent years, pressure groups such as unions, politicians, and displaced persons have raised opposing demands on enterprise management, such as internal recruitment and promotion, preference to personnel’s children, displaced persons, and sons of soil. 8) Systems ApproachIt has been noted that the dissemination of system thinking and the advent of the macro computer are part of the ongoing revolution in information technology that emphasizes planning and newer ways of handling voluminous personnel records. 9) Lead TimeIn order for the employee to successfully handle new knowledge and skills, the log lead time is needed in the selection process, training, and deployment. Importance of Human Resource PlanningHuman resource planning is a subsystem of organizational planning. The purpose of organizational planning is to establish the company’s goals for the future and determine the appropriate means by which to reach those goals. On the basis of the key roles HRP plays in the organization, we examine the importance of HRP within the organization. 1. Future Personnel NeedsAn organization’s future personnel needs can be determined through human resource planning. Whenever an organization is experiencing either a surplus or deficit of staff strength, it is the result of an ineffective human resource plan. Due to the fact that the public sector enterprises never planned their staffing requirement and went on a hiring spree until the late 1980’s, all public sector enterprises are now overstaffed. Many companies in the private sector are resorting to VRS ‘voluntary retirement scheme’ because of excess staff. There would have been an excess of labor problem if the organization had a good HRP system. A good HRP system will also enable the organization to plan its succession. 2. Part of Strategic PlanningThe Human Resource Planning process has become a key component of the strategic planning process. When formulating a strategic plan, HRP gives input into whether the organization has the appropriate human resources to execute the strategy. Human resources are also necessary during the implementation stage in order to determine how to allocate resources based on organizational structure, process, and human resources. A substantial role is played by HRP in some organizations, and HR issues are seen as an inherent part of business management. 3. Creating Highly Talented PersonnelAlthough India has a significant number of educated unemployed, it is the HR manager’s discretion that will allow the organization to hire the right person with the right skills. Even existing employees hope for the job so frequently that the organization frequently faces manpower shortages. In order to cope with this shortage of skilled manpower, skilled manpower planning in the form of skill development is required. 4. International StrategiesHuman resources planning plays a key role in facilitating an organization’s international expansion strategy. Recruiting foreign nationals to fill key positions and reassigning employees within or across borders is a major challenge that international business faces. Due to the trend towards globalization, the need for HRP will increase as well as the need to better integrate HRP with a company’s strategic plans. With the growing competition for foreign executives, there may be costly and strategic turnover among key decision makers without an effective HRP and subsequent attention to recruitment, selection, placement, training, and career planning. 5. Foundation for Personnel FunctionsHRPs provide valuable information about designing, selecting, training and developing personnel, transferring, promoting, and laying off employees. 6. Increasing Investments in Human ResourcesHRP is becoming increasingly important as organizations invest more in human resources development. The value of human assets can increase more than that of physical assets, organizations are realizing. Employees who develop their skills and abilities gradually become valuable assets to the organization. A trained, flexible, motivated, and productive workforce is difficult to value in terms of rupees due to the fact that it can be acquired either directly or through job assignments. There has been a growing recognition that the quality of the workforce is responsible for both short- and long-term organizational performance. 7. Resistance to ChangeWhen employees hear about change or even job rotation, they are always reluctant to accept it. It is impossible for organizations to transfer employees from one department to another without prior planning. The planning of job rotation (moving an employee from one department to another) involves matching the skills required and the existing skills of the employees. 8. Uniting the Viewpoint of Line and Staff ManagersLine and staff managers can work together through HRP. The HRP is initiated and executed by the organization’s staff, but everyone within an organization is expected to participate and cooperate. Managers are the most knowledgeable about the challenges their departments face. The success of HR Planning and Development depends on effective communication between HR staff and line managers. 9. Succession PlanningPeople are prepared for future challenges through Human Resource Planning. Employees are identified, trained, assessed, and assisted continuously so they can quickly assume the responsibilities and positions of their boss or seniors as and when the need arises. 10. Other Benefits:
Factors Affecting HRPHRP is influenced by several factors. The most important of the factors that affect HRP are (1) type and strategy of organization 1. Type and Strategy of the OrganizationOrganization type determines what production processes are involved, how many and what type of employees are needed, and what supervisory and managerial personnel are required. Human resources are also determined by the organization’s strategic plan. The organization would require additional employees if it is planning organic growth. Alternatively, if the company is planning on merging and acquiring, they must prepare for layoffs. Mergers can create, duplicate or overlap positions that are more efficiently handled with fewer people. It is up to the organization to decide whether it will be reactive or proactive in HRP. Either organizations anticipate the needs in advance and plan to fill them systematically (proactive), or they react to the needs as they arise (reactive). HR plans must similarly be designed to meet the needs of the organization. It is possible for an organization to select one or two HR areas like recruitment and selection to plan for, or it can plan for all HR functions including training and compensation. The formality of the HR plan is also determined by the nature of the HR plan. A company can choose to have a formal HR plan that is written down or to have an informal HR plan that is created by the managers and human resources staff. The type of HR plan also depends upon how flexible the company is. It should be able to anticipate and deal with unforeseen events. HRPs are designed so that they can be flexible and adaptable to many circumstances, ensuring that the plan is flexible and adaptable. 2. Organizational Growth Cycles and PlanningEvery organization goes through different stages of growth from the day it is founded. Organizational growth determines the nature and extent of human resources planning. The personnel planning in smaller organizations may not be well defined in the early stages of growth. Yet the organization feels the need to plan its human resources as it enters its growth stage. It emphasizes employee development at this stage. However, as the organization reaches the mature stage, it experiences less flexibility and variability, which results in a low growth rate. As HR planning becomes more formalized and less flexible, and as issues such as retirement and retrenchment become more problematic, it becomes less innovative. During the declining stage of the organization, HRP focuses on planning layoffs, retrenchments, and retirement. Whenever a company is experiencing financial or sales distress, the planning process becomes reactive in nature. 3. Environmental UncertaintiesChanges in political, social, and economic environments impact all organizations greatly, and the fluctuations that happen in these environments have a drastic effect on organizations. Recruitment, selection, training, and development policies and programmes are formulated carefully by personnel planners in order to deal with such environmental uncertainties. We achieve balance in our organization through succession planning, promotions, layoffs, flexitime, job sharing, retirement, VRS, and other arrangements pertaining to personnel. 4. Time HorizonsThere are short-term and long-term HR plans. Generally, short term plans last six months to a year, whereas long term plans last between three and twenty years. Depending on the level of uncertainty in an organization’s environment, the period of time required may vary. In general, longer time horizons are required for more uncertain circumstances. 5. Type and Quality of informationVarious sources of information are used to forecast personnel requirements. Personnel planners depend to a large extent on the quality and type of information they have available to them. Information quality and accuracy are directly related to the clarity with which the decision makers in the organization have defined their strategy, structure, budgets, and production schedules. 6. Nature of Jobs Being FilledA person in charge of staffing within an organization should be very particular about the types of positions being filled. Employees at lower levels who need very limited skills can be hired quickly. However, when it comes to hiring employees for higher positions, discretion is needed. It is necessary that organizations anticipate vacancies as far in advance as possible, in order to provide sufficient time to recruit suitable candidates. 7. OutsourcingSubcontracting is a practice in which organizations outsource a part of their work to outside parties. It is common in both the public and private sectors to outsource services and activities. There are many companies that have surplus labor, so instead of hiring more people, they outsource. Companies typically outsource noncritical tasks. HRP is determined by outsourcing non-critical activities through subcontracting. Human Resource Planning ProcessHuman Resource Planning involves forecasting human needs, assessing human supply, and matching demand with supply factors through personnel management programmes. Organizational objectives and the business environment influence the HR planning process. 1) Environmental ScanningThe term refers to the systematic monitoring of the external forces influencing the organization. Organizations can
anticipate and adjust to the impact of changes by scanning the environment for those that will impact them. The following forces are essential for pertinent HRP. 2) Organizational Objectives and PoliciesAn HR plan typically derives from organizational objectives. From organizational objectives, specific requirements about the number and characteristics of employees can be derived. All stakeholders must agree on the organizational objectives, communicate them and understand them before the HR department can specify its objectives with regards to HR utilization in the organization. 3) HR Demand ForecastA demand forecast estimates the amount and quality of people that will be necessary to meet future organizational needs. HR forecasts are derived from the annual budget and long-term corporate plan, which are translated into activity into activity. For example, When a company manufactures products, the sales budget is used
as the basis for putting together the production plan that shows the number and type of products to be produced in each period. The organization will use this to determine the number of hours each skilled category of worker will be required to work. A company can determine the quality and quantity of personnel required for a particular task based on the number of hours needed. 1. Quantify the jobs, necessary for producing a given number of goods. Organizations employ methods such as managerial judgment, ratio-trend analysis, regression analysis, work study techniques, and Delphi techniques to forecast demand. 4) HR Supply ForecastThe supply forecast determines whether or not the HR department will be able to procure the required number of workers. After allowing for absences, internal movements and promotions, waste and changes in hours, as well as other work conditions, the supply forecast measures the number of people estimated to be available within and outside an organization. Supply forecast is required because it is needed as it
Supply analysis covers the existing human resources, internal sources of supply and external sources of supply. 5) HR ProgrammingIn order for vacancies to be filled by the right employees at the right time, an organization’s personnel demand and supply must be forecasted and balanced. 6) HR Plan ImplementationA HR plan must be turned into action in order to be implemented. Implementation of HR plans involves a series of actions. When an HR plan is formulated, programs such as recruitment, selection, training, and placement, retraining, and redeployment, retention, and succession plans are all used. 7) Control and EvaluationEvaluation and control are the final phases of the HRP process. HR plans include budgets, targets, and standards. Performance will be evaluated and monitored against the plan. The organizations will evaluate the number of people they employ (both those currently employed and those on the pipeline) and the number recruited against their recruitment targets. The employment cost of employees is also assessed against the budget and wastage accrued in order to take corrective action in the future. Read More…….. Requisites for Successful HRP1. Human resource planning should be integrated into corporate planning. Barriers to Human Resource Planning (HRP)When formulating an HRP, Human Resource Planners face significant challenges. Following are some of the key obstacles:
Human Resource Planning Quiz/ MCQsHuman resource planning is the term used to describe how companies(A) ensure that their staff is the right staff to carry out the jobs Human Resource Planning consists of the following activities.(A)
Planning the necessary programmes of requirement, selection, training, development, utilization, transfer, promotion, motivation and compensation The following can affect the Manpower Planning(A) Seasonal trends in demands The correct order of steps in HR Planning is(A) Investigation – Forecasting – Inventory – Audit – HR Resource Plan –
Action of Plan – Utilization In ___ analysis of demand and supply of manpower is done(A) Investigation Human resources planning should serve as a link between human resources management and the overall ___ of an organization.(A) budget Supply forecasting measures the number of people likely to be available from within and outside the organization, after making allowance for(A) promotion Supply analysis covers(A) External source of supply The audits of non-managers are called(A) skill inventories Turnover rate =(A) Number of separations during one year / Average number of employees during the year Following is (are) the requisites for successful Human Resource Planning(A) Support from employees The 3C principle consists of(A) clarity, classification, and coherence The correct order which the human resource professionals generally follow, is(A) Workforce Analysis – Work load Analysis – Job Analysis Job analysis includes two things:(A) Job design and job specification The HR Planning process, should be tuned to(A) organizational objectives Similarly, You May Also Like:
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