Assignment for the

class

Prepare a write-up on:-

HRM- Concept, evolution,

importance, role and functions.

in 1000 words
HUMAN
RESOURCE
PLANNING
Strategic Planning

Procedures for making decisions about the

organization’s long term goals and strategies
Human Resources Planning
(HRP)

The process of anticipating and providing for

the movement of people into, within, and out
of an organization.
Strategic HRM
SHRM combines strategic planning and HR
Planning

The pattern of human resources deployments

and activities that enable an organization to
achieve its strategic goals.

HR strategy is designed in tune with business

strategy.
The first part of HR Strategy is Human
Resource Planning.

All other HR activities such as employee

hiring, training and development,
remuneration, appraisal and labour relations
are derived from HRP
There is generally shortage of suitable persons in
any organization

The organization determines its manpower

needs and then finds out the sources from
which the requirements will be met.
 Human Resource Planning

Process by which management determines how an

organization should move from its current manpower
position to the desired manpower position

Management strives to have

1. the right number
2. the right kinds of people
3. at the right places
4. at the right time
HRP is understood as the process of
forecasting an organization’s future demand for
and supply of the right type of people in the
right number.

It is only after this that HRM department can

initiate the recruitment and selection process.

Human Resource Planning is a sub-system in

the total organizational planning
 Importance/ Need for HRP

1. Planning for Future Personnel Needs

Surplus or deficiency in staff strength is the result of

absence of or defective planning
 2. Replacement of persons

Large no. of persons are replaced due to

1. Retirement

2. Old age

3. Death

Need to prepare persons for taking up new

positions in such contingencies
3. Labour turnover

The rate at which employees in an organization

leave their position in a designated time period,
usually over an year, is called labour turnover

The degree of labour turnover may vary from

concern to concern

Need to recruit new persons to take up the

positions of those who have left the organization
4. Expansion Plans

When there is a plan to expand or diversify

the concern then more persons are required
5. Technological Changes

Need to give fresh training to personnel.

In addition, need to infuse fresh blood into the

organization
 6. Assessing Needs

Whether there is any shortage or surplus of

persons in the organization?

If there are less persons than required, it will

adversely affect the work.

On the other hand, if more persons are

employed than requirement then it will increase
labour cost.
 Process of HRP

HRP essentially involves forecasting personnel

needs, assessing personnel supply and matching
demand-supply factors through personnel related
programmes.

Recruitment and selection process starts with

employment/ personnel planning
Process of deciding what positions the firm will
have to fill and how to fill them

Personnel planning embraces all future positions

from maintenance clerk to CEO
Organizational Objectives and
Policies
HR plans needs to be based on
organizational objectives.
Specific requirements in terms of number
and characteristics of employees should be
derived from organizational objectives.
Once the organizational objectives are
specified, communicated and understood
by all concerned, the HR department must
specify its objectives
The following questions have to be
addressed :
1. Are vacancies to be filled by promotions
from within or hiring from outside?
2. How to enrich jobs? Should routine and
boring jobs continue or be eliminated?
3. How to ensure continuous availability of
adaptive and flexible workforce?
4. To what extent production and operations
be automated and what can be done
about those displaced?
Environmental Scanning
Refers to systematic monitoring of external
forces influencing the organization like:
1. Economic factors, general and regional
conditions
2. Technological changes, automation and
robotics
3. Demographic changes, age, composition
and literacy
4. Political and legislative issues
5. Social concerns, educational facilities
etc….
HR Demand Forecasting
Process of estimating the future quantity and
quality of people required.
It helps in:
1. Quantifying jobs
2. Determining what staff mix is desirable in the
future
3. Assessing appropriate staff levels in different
departments so as to avoid unnecessary
costs
4. Prevent shortages of people
5. Monitor compliance with legal requirements
Forecasting Techniques

Managerial Judgement

Managers sit together, discuss and arrive at a figure

which would be the future demand for labour.

Technique may involve ‘bottom up’ and ‘top down’

approach

In ‘Bottom up’ line managers submit their

departmental proposals to top managers who arrive
at the company’s forecast.
‘Top down’ approach involves top managers who
prepare company and departmental forecasts.

These forecasts are reviewed with the departmental

heads and agreed upon.

Neither of these approaches is accurate.

A committee comprising departmental mangers and

HR managers will review the two sets of forecasts,
arrive at consensus which in turn can be presented
to the top managers for their approval.
Ratio –trend analysis

Involves studying the past ratios and

forecasting future ratios making some
allowances for changes in the organization
or its methods
Regression analysis

It is based on the relationship between sales

volume and employee size.

However, it is more statistical.

Work-study technique
Can be used where the volume of work is easily
measureable. Total production and activities in terms of
clear units are estimated in a year. Man hours required to
produce each unit is calculated. Work ability of each
employee is estimated and due weightage is given to
absenteeism, rest etc. then required no. of employees is
calculated.
e.g.,
planned output for next year 20,000 units
standard hours per unit 5
planned hours for the year 1,00,000
productive hours per worker/ year 2000
number of direct workers required 50
Delphi technique

It estimates personnel needs from a group

of experts, usually managers.

HRP experts act as intermediaries,

summarize the various responses and report
the findings back to the experts.

The experts are surveyed again after they

receive this feedback
Summaries and surveys are repeated until
the expert’s opinion begin to agree.

The agreement reached is the forecast of

the personnel needs.

Distinguishing feature is there is no

interaction among experts.
Flow models
Simplest flow model is called Markov Model
 In this technique, forecasters will:
1. Determine the time that should be covered.
Shorter lengths of time are generally more
accurate than longer ones.

2. Establish categories, called ‘states’, to which

employees can be assigned.

3. These categories must not overlap and must take

into account every possible category to which an
individual can be assigned.
3. Count annual movements called ‘flows’ among
states for several time periods. These states are
defined as ‘absorbing’ (gains or losses to the
company) or ‘non absorbing’ (change in position
levels or employment status).

4. Losses include death or disability, absences,

resignations, and retirements. Gains include hiring,
rehiring, transfer and movement by position level.
New venture analysis
Technique requires planners to estimate
HR needs in line with companies that
perform similar operations

E.g., a petroleum company that plans to

open coal mine can estimate its future
employment needs by determining
employment levels of other coal mines.
The next logical step for the management
is to determine it will be able to procure the
required number of personnel and the
sources of such procurement.
HR Supply Forecast
Determines whether the HR department will
be able to procure the required number of
personnel.

Specifically, supply forecast measures the

number of people likely to be available from
within and outside an organization.
Supply analysis covers:

1. Existing human resources

2. Internal sources of supply
3. External sources of supply
Present employees

 Analysis of present employees is greatly facilitated

by HR audits.
 HR audits summarize each employee’s skills and
abilities.
 Audits of non-managers are called ‘skill
inventories’ and those of the management are
called ‘management inventories’.
 This summary gives planners a comprehensive
understanding of the capabilities found in the
organization’s workforce.
Skill Inventories
Skill inventories consolidate information
about non-managers in the organization.

The information from skill inventories is

used as input into transfer and promotion
decisions, they should contain information
about each employee’s current job.
Seven broad categories of information are
included in each skill inventory:

1. Personal data—age, gender, marital status

2. Skills—education, job experience, training
3. Special qualification—membership in professional
bodies, special achievements
4. Salary and job history—present and past salary,
dates of pay raises, various jobs held
5. Company data—benefit plan data, retirement
information, seniority
6. Capacity of individual—scores on psychological and
other tests, health information
7. Special preference of individual—geographic
location, type of job
The popularity of skill inventories has
increased with use of computers.

Use of computers for collecting, storing,

maintaining, retrieving and validating data is
popularly called Human Resource
Information System (HRIS)
Human Resource Information System
A systematic procedure for collecting,
storing, maintaining, retrieving and validating
data needed by an organization about its
human resources.

HRIS is usually a part of the organization’s

larger Management Information System
(MIS).
Management Inventories
 Work history
 Strengths
 Weaknesses
 Promotion potential
 Career goals
 Personal data
 Number and types of employees supervised
 Total budget managed
 Previous management duties

Inventories of human resource is computerized and

updated periodically
Managerial Succession
Planning
Includes training programmes and series of job
assignments leading to top positions.

Methods of succession planning may vary.

Most programmes would include top

management’s involvement and commitment,
high level review of succession plans, formal
assessment of performance and potential of
candidates, and written development plans for
individual candidates.
Most managerial succession planning
systems rely on committees of higher level
managers to identify high potential
candidates and plan development activities
for them.

Development plans include formal training

programmes and series of job assignments
leading to top positions.
A typical succession planning
involves following activities:
1. Analysis of demand for managers and
professionals at company level, function and skill
2. Audit of existing executives and projection of
likely future supply from internal and external
sources
3. Planning of individual career paths based on
objective estimates of future needs and drawing
on reliable performance appraisal and
assessment of potential.
 Career counselling
 Accelerated promotions, with development
targeted against the future needs of the firm, as
well as those of individual
 Performance related training and development, to
prepare individuals for future roles as well as
current responsibilities
 Planned strategic recruitment, not only to fill short
term needs but also to provide people for
development to meet future needs
 The actual activities by which openings are filled