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EMBA, LECTURE-3 HUMAN RESOURCE PLANNING

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Presentation on theme: "EMBA, LECTURE-3 HUMAN RESOURCE PLANNING"— Presentation transcript:

1 EMBA, LECTURE-3 HUMAN RESOURCE PLANNING
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3 Introduction Human Resource Planning is concerned with the flow of people into, through, and out of an organisation. HR planning necessarily involves a focus on employees, changing skill levels and the way in which those skills match organisational needs

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5 Definition: The systematic and continuing process of analysing an organisation's human resource needs under changing conditions and developing personnel policies appropriate to the long term effectiveness of the organisation. It is an integral part of corporate planning and budgeting procedures since HR costs and forecasts both affect and affected by long-term corporate plans

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7 ROLE OF HUMAN RESOURCE PLANNING
To determine and facilitate the levels and types of recruitment that may be required To assess current levels and attributes of staffing and determine whether reductions are necessary To assess whether redeployment can be used as an alternative to downsizing To identify the need for training and development To assess current employment costs in relation to other organisational costs.

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9 HARD AND SOFT HR PLANNING
HARD HRP SOFT HRP Forecasting Define where the company is now Analysis Monitoring and review Define where it wants to be in the future Analysing the external environment, influences and trends Formulating plans to implement necessary changes

10 HUMAN RESOURCE PLANNING
Right number of people with right skills at right place at right time to implement organizational strategies in order to achieve organizational objectives In light of the organization’s objectives, corporate and business level strategies, HRP is the process of analyzing an organization’s human resource needs and developing plans, policies, and systems to satisfy those needs

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12 HUMAN RESOURCE PLANNING
Setting human resource objectives and deciding how to meet them Ensuring HR resource supply meets human resource demands

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14 HRP Process Interfacing with strategic planning and scanning the environment Taking an inventory of the company’s current human resources Forecasting demand for human resources Forecasting the supply of HR from within the organization and in the external labor market

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16 HRP Process Cont. Comparing forecasts of demand and supply
Planning the actions needed to deal with anticipated shortage or overages Feeding back such information into the strategic planning process.

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18 THE PROCESS OF HRP COLLECT INFORMATION & ANALYSIS OF EXISTING RESOURCES FORECAST DEMAND FOR HUMAN RESOURCES -SHORT AND LONG TERM -AGGREGATE OR INDIVIDUAL POSITIONS FORECAST SUPPLY OF HUMAN RESOURCES -INTERNAL SUPPLY -EXTERNAL SUPPLY PLAN AND CONDUCT NEEDED PROGRAMS -Increase or reduce workforce size -change skill mix -develop managerial succession plans -develop career plans MONITORING THE IMPLEMENTATION OF THE PLAN -Where the forecasts accurate? -Did the programs meet the needs?

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20 1. ANALYSIS OF THE WORKFORCE
INVENTORIES OF THE EXISTING WORKFORCE SUCCESSION PLANS-to determine the type and calibre of managers available to succeed senior or middle managers who retire or leave MOVEMENT OF EMPLOYEES-promotions and transfers USE OF STAFF-overtime working, Absenteeism, ineffective or wasted time or efficiency in the use of labour LABOUR TURNOVER-an analysis of the rates at which staff are leaving employment 7 of trends of such turnover COSTS-to know at which point recruitment becomes most cost-effective than increased overtime working.

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22 2. FORECASTING THE DEMAND FOR HR
Demand forecasting methods can be divided into two categories JUDGEMENTAL METHOD MATHMATICAL METHODS JUDGEMENTAL METHODS -Bottom up or Unit Forecasting -Top down Forecasting -Delphi technique MATHEMATICAL METHODS -Productivity ratio: -Direct to Indirect staffing ratio

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24 3.FORECAST SUPPLY OF HR THE INTERNAL SUPPLY OF LABOUR
THE EXTERNAL SUPPLY OF LABOUR -The external labour market -demographic change -labour immobility -early retirement -Changing employment patterns(e.g robotics in car manufacture, computer aided design/manufacture,JIT, e-commerce) -Changing patterns of work (e.g part-time workers, flexible workforce etc)

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26 Staff/skill shortages
4. PLANNINH HR PROGRAMS Staff/skill shortages -promoting existing staff, Redeployment of staff, training -getting more from existing staff, Job design -External recruitment Staff surpluses -stopping recruitment -Natural wastage, transfer, early retirements, Reducing overtime -Short-time working, redundancy, reducing subcontracted work 3. Managerial succession planning Career planning Organisation and structure plans Performance planning

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28 5. IMPLEMENTATION OF THE PLAN
ACQUISITION STRATEGIES: Which define how the resources required to meet forecast needs will be obtained RETANTION STRATEGIES: Which indicate how the organisation intends to keep the people it wants. DEVELOPMENT STRATEGIES:Training and development programmes UTILISATION STRATEGIES: which indicate intentions to improve productivity and cost-effectiveness. FLEXIBILITY STRATEGIES: How the organisation can develop more flexible work arrangements. DOWNSIZING STRATEGIES: Which define what needs to be done to reduce the numbers employed

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30 Example of the Basic Human Resource Planning Model
Open new product line Open new factory and distribution system Develop staffing for new installation Production workers Supervisors Technical staff Other managers Recruiting and training programs feasible Transfers infeasible because of lack of managers with right skills Recruit skilled workers Develop technical training programs Transfer managers from other facilities 2 3 1 4 Develop new objectives and plans Recruit managers from outside 3 Too costly to hire from outside 5

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32 Link 1: Determine Demand (labor requirements)
How many people need to be working and in what jobs to implement organizational strategies and attain organizational objectives. Involves forecasting HR needs based on organizational objectives Involves consideration of alternative ways of organizing jobs (job design, organizational design or staffing jobs) Example - Peak production could be handled by temporary workers or assigning overtime. Machine breakdowns assigned to maintenance department or handled by machine operators

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34 Link 2: Determine HR Supply (availability)
Choose HRM programs (supply) Involves forecasting or predicting effect of various HR programs on employee flowing into, through and out various job classifications. First determine how well existing programs are doing then forecast what additional programs or combination of programs will do Need to know capabilities of various programs and program combinations

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36 Determine Feasibility Links 3 & 4
Capable of being done Requires knowledge of programs, how programs fit together and external environmental constraints (e.g., labor force, labor unions, technology created skill shortages) and internal environmental constraints (skill shortages within the organization, financial resources, managerial attitudes, culture) Do the benefits outweigh the costs Difficulty in quantifying costs and benefits

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38 Revise Organizational Objectives and Strategies Link 5
If no feasible HR program can be devised, the organization must revise strategic plans.

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40 Human Resource Forecasting
Process of projecting the organization’s future HR needs (demand) and how it will meet those needs (supply) under a given set of assumptions about the organization’s policies and the environmental conditions in which it operates. Without forecasting cannot assess the disparity between supply and demand nor how effective an HR program is in reducing the disparity.

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42 Shortcomings of the model - HRP in Practice
Oversimplification of the benefit of planning is the specific plans that result Planning process has value in and of itself HRP in practice is usually less rational and may omit one or more of the steps May lack knowledge required for forecasting Incorrect assumptions about effectiveness of HR programs Does not engage in strategic planning Resistance to change present HR systems

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44 HRP should be: Done to guide and coordinate all HR activities so they work together to support the overall strategy Responsive to internal and external environment Planning - done in advance Strategic - linked with higher level planning

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46 Human Resource Forecasting
Process of projecting the organization’s future HR needs (demand) and how it will meet those needs (supply) under a given set of assumptions about the organization’s policies and the environmental conditions in which it operates. Without forecasting cannot assess the disparity between supply and demand nor how effective an HR program is in reducing the disparity.

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48 Forecasting as a Part of Human Resource Planning
Choose human resource programs SUPPLY FORECASTING DEMAND FORECASTING Determine organizational objectives Internal programs Promotion Transfer Career planning Training Turnover control External programs Recruiting External selection Executive exchange Demand forecast for each objective Aggregate demand forecast Internal supply forecast External supply forecast Does aggregate supply meet aggregate demand? Aggregate supply forecast No Yes Go to feasibility analysis steps

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50 Internal Supply Forecasting Information
Organizational features (e.g., staffing capabilities) Productivity - rates of productivity, productivity changes Rates of promotion, demotion, transfer and turnover

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52 External Supply Forecasting Information
External labor market factors (retirements, mobility, education, unemployment) Controllable company factors on external factors (entry-level openings, recruiting, compensation)

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54 Demand Forecasting Information
Organizational and unit strategic plans Size of organization Staff and Managerial Support Organizational design

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56 Considerations in Establishing a Forecasting System
How sophisticated Appropriate time frame Subjective versus objective forecasting methods

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58 System Sophistication
Organizational size large organizations require more complex forecasting systems and likely to have the required skilled staff Organizational complexity complex career paths and diverse skill requirements lead to more complex forecasting systems Organizational objectives the greater the gap between current HR situation and desired HR situation the more sophisticated the system Organizational plans and strategies the complex the plans are the more complex the forecasting system

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60 Forecasting Time Frame
Depends on degree of environmental uncertainty Factors creating uncertainty (shortening time frame) many new competitors, changes in technology, changes in social, political and economic climate, unstable product demand Factors promoting stability (longer time frame) strong competitive position, slowly developing technology, stable product demand.

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62 Supply Forecasting Methods
Skills Inventory Replacement Charts Succession Planning Computer Simulations

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