3-1 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. CHAPTER THREE Planning Screen graphics created by: Jana F. Kuzmicki, PhD Troy State University-Florida and Western Region

3-2 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Organization Strategy HR and Staffing Strategy Staffing Policies and Programs Staffing System and Retention Management Support Activities Legal compliance Planning Job analysis Core Staffing Activities Recruitment: External, internal Selection: Measurement, external, internal Employment: Decision making, final match Organization Vision and Mission Goals and Objectives Staffing Organizations Model

3-3 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Chapter Outline External Influences  Economic Conditions  Labor Markets  Labor Unions Human Resource Planning  Process and Example  Initial Decisions  Forecasting HR Requirements  Forecasting HR Availabilities  External and Internal Environmental Scanning  Reconciliation and Gaps  Action Planning Staffing Planning  Staffing Planning Process  Core Workforce  Flexible Workforce Legal Issues  AAPs  Legality of AAPs  Diversity Programs  EEO and Temporary Workers

3-4 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.1: Examples of External Influences on Staffing Economic expansion and contraction Job growth and job opportunities Internal labor market mobility Turnover rates Economic Conditions Labor demand: Employment patterns, KSAOs sought Labor supply: Labor force, demographic trends, KSAOs available Labor shortages and surpluses Employment arrangements Labor Markets Negotiations Labor contracts: Staffing levels, staffing quality, internal movement Grievance systems Labor Unions

3-5 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. General Economic Conditions, Job Growth, HR Movement Impacts HR Movement Impacts New labor force entrants Current labor force Unemployed Employed Promotion Transfer Demotion New hiresInternal labor marketExit Out of labor force Unemployed To new job General Economic Conditions Product markets Labor markets Inflation Interest rates Foreign exchange rates Government regulations Job Growth Positive = Expansion Neutral = Stagnation Negative = Contraction

3-6 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Labor Markets: Demand for Labor Employment patterns  Demand for labor is a derived demand  Job growth projections  Employment growth projections KSAOs sought  KSAO requirements  Education levels  Exh. 3.2: Employer Opinions About Needed Skills Enhancement  Manufacturing sector - Survey of skill deficiencies  Managerial skills - Critically required skills

3-7 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.2: Employer Opinions About Needed Skills Enhancement

3-8 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Important Management Skills for the Future 1. Rapid Response 2. Sharp Focus 3. Stress Busting 4. Strategic Empowerment 5. Staff Empowerment 6. Team Building

3-9 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Labor Markets: Supply of Labor Trends in supply of labor  Quantity of labor - Exh. 3.3: Labor Force Statistics  Labor force trends relevant to staffing  Growth  KSAOs  Demographics  Other trends ??? KSAOs available  Educational attainment  Literacy  Motivation

3-10 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Labor Markets: Other Issues Labor shortages and surpluses  “Tight” labor markets  “Loose” labor markets Employment arrangements  Full-time vs. part-time  Regular or shift work  Alternative employment arrangements  Exh. 3.4: Usage of Alternative Employment Arrangements and Contingent Workers

3-11 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Labor Unions Trends in union membership  Percentage of labor force unionized  Private sector unionization rate  Public sector unionization rate Contract clauses affecting staffing Impacts on staffing  “Spillover effects”

3-12 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Labor Unions: Contract Clauses Affecting Staffing Management rights Jobs and job structure External staffing Internal staffing  Job posting  Lines of movement  Seniority Grievance procedure Guarantees against discrimination

3-13 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. What is Human Resource Planning (HRP)? Involves activities to  Forecast an organization’s  Labor demand -- Requirements  Internal labor supply -- Availabilities  Compare projections to determine employment gaps  Develop action plans to addressing the gaps  Staffing planning

3-14 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Overview: Human Resource Planning Process and example Initial decisions Forecast HR requirements Forecast HR availabilities External and internal environmental scanning Reconciliation and gaps Action planning

3-15 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.5: The Basic Elements of Human Resource Planning (5) Develop Action Plans Compare (1) Forecast Labor Requirements (2) Forecast Labor Availabilities (3) Conduct Environmental Scans (4) Determine Gaps

3-16 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Process and Example 1. Determine future HR requirements 2. Determine future HR availabilities 3. Conduct external and internal environmental scanning 4. Reconcile requirements and availabilities - determine gaps 5. Develop action plans to close projected gaps  Exh. 3.6: Operational Format and Example for HRP

3-17 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Initial Decisions Comprehensiveness of planning  Plan-based HRP  Special projects HRP  Population-based HRP Planning time frame Job categories and levels Head count - current workforce  Ignores scheduled time worked by each employee relative to a full workweek - FTEs  Ignores vacancies Roles and responsibilities

3-18 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Forecasting HR Requirements Statistical techniques  Exh. 3.7: Examples of Statistical Techniques to Forecast HR Requirements Judgmental techniques  “Top-down” approach  “Bottom-up” approach

3-19 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Forecasting HR Availabilities Approach  Determine head count data for current workforce and their availability in each job category/level  See Exh. 3.6 Statistical techniques  Exh. 3.8: A Forecast of Future HR Availabilities  Markov analysis  Exh. 3.9: Use of Markov Analysis to Forecast Availabilities  Limitations of Markov analysis

3-20 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Forecasting HR Availabilities (continued) Judgmental techniques  Executive reviews  Succession planning  Exh. 3.10: Employee Replacement Chart for Succession Planning  Vacancy Analysis  Exh. 3.11: Vacancy Analysis for Sales and Customer Service Unit

3-21 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.10: Employee Replacement Chart for Succession Planning

3-22 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: External Environmental Scanning External scanning involves  Tracking trends and developments in external environment,  Documenting implications for management of human resources, and  Ensuring implications receive attention  Exh. 3.12: Example of Environmental Scan

3-23 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Internal Environmental Scanning Internal scanning involves  Informal discussions with key managers  Conducting employee attitude surveys  Monitoring key indicators  Employee performance  Absenteeism  Turnover  Accidents  Identifying nagging personnel problems  Assessing managerial attitudes regarding HR

3-24 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Reconciliation and Gaps Phase involves  Coming to grips with projected gaps  Likely reasons for gaps  Assessing future implications Exhibit 3.13: Format and Example for Human Resource Planning (HRP)

3-25 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. HRP: Action Planning Set objectives Generate alternative activities Assess alternative activities Choose alternative activities

3-26 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Staffing Planning Process Staffing objectives  Quantitative objectives  Exh. 3.14: Setting Numerical Staffing Objectives  Qualitative objectives Generate alternative staffing activities  Exh. 3.15: Staffing Alternatives to Deal with Employee Shortages and Surpluses Assess and choose alternatives  Exh. 3.16: Organizations’ Responses to Staffing Strategies Survey

3-27 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.15: Staffing Alternatives to Deal with Employee Shortages and Surpluses

3-28 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.16: Organizations’ Responses to Staffing Strategies Survey

3-29 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Staffing Planning: Core Workforce Advantages Disadvantages Staffing philosophy  Internal vs. external staffing  Exh. 3.17: Internal vs. External Staffing  EEO / AA practices  Applicant reactions Staffing flows  Organization staffing flowchart  Exh. 3.18: Staffing Flowchart for Medium-Sized Printing Company

3-30 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.17: Internal vs. External Staffing

3-31 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Exh. 3.18: Staffing Flowchart for Medium-Sized Printing Company

3-32 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Staffing Planning: Flexible Workforce Advantages Disadvantages Two categories  Temporary employees  Staffing firms  Exh. 3.19: Factors to Consider When Choosing a Staffing Firm  Independent contractors

3-33 McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. Legal Issues Affirmative Action Plans (AAPs)  Exh. 3.20: Example of AAP: Essential Components  Affirmative Action Programs Regulations Legality of AAPs  Guidelines for AAPs Diversity programs EEO and temporary workers