HRM 302: Human

Resource Management
Faculty: Most. Monowara Begum Mamy
Semester: Spring 2021
CHAPTER: 02 ( HR Planning)
Human Resource Planning

 According to Leon C. Megginson human resource planning is “an integrated approach

to performing the planning aspects of the personnel function in order to have a
sufficient supply of adequately developed and motivated people to perform the
duties and tasks required to meet organisational objectives and satisfy the individual
needs and goals of organisational members.”

 Human resource planning may be viewed as foreseeing the human resource

requirements of an organisation and the future supply of human resources and- (i)
making necessary adjustments between these two and organisational plans; and (ii)
foreseeing the possibility of developing the supply of human resources in order to
match it with requirements by introducing necessary changes in the functions of
human resource management. In this definition, human resource means skill,
knowledge, values, ability, commitment, motivation, etc., in addition to the
number/of employees.
Importance of HR planning

 I. Assessing Future Personnel Needs:

Whether it is surplus labour or labour shortage, it gives a picture of defective planning or absence of
planning in an organization. A number of organizations, especially public sector units (PSUs) in India are
facing the problem of surplus labour.It is the result of surplus labour that the companies later on offer
schemes like Voluntary Retirement Scheme (VRS) to eliminate surplus staff. Thus, it is better to plan well
about employees in advance. Through HRP, one can ensure the employment of proper number and type
of personnel.

II. Foundation for Other HRM Functions:

HRP is the first step in all HRM functions. So, HRP provides the essential information needed for the other
HRM functions like recruitment, selection, training and development, promotion, etc.
III. Coping with Change:
Changes in the business environment like competition, technology, government guidelines, global market,
etc. bring changes in the nature of the job. This means changes in the demand of personnel, content of
job, qualification and experience needed. HRP helps the organization in adjusting to new changes.
Contd…..

IV. Investment Perspective:

As a result of change in the mindset of management, investment in human resources is viewed as a
better concept in the long run success of the enterprise. Human assets can increase in value as
opposed to physical assets. Thus, HRP is considered important for the proper planning of future
employees.

V. Expansion and Diversification Plans:

During the expansion and diversification drives, more employees at various levels are needed.
Through proper HRP, an organization comes to know about the exact requirement of personnel in
future plans.
VI. Employee Turnover:
Every organization suffers from the small turnover of labour, sometime or the other. This is high
among young graduates in the private sector. This necessitates again doing manpower planning for
further recruiting and hiring.
HR Planning Process

Step 1: Assess your current human resource capacity

Start by looking at your current human resources state of play. This will involve analyzing the HR strength of
your organization across factors including employee numbers, skills, qualifications, experience, age, contracts,
performance ratings, titles, and compensations. During this phase, it’s a good idea to gather insight from your
managers who can provide real-world feedback on the human resource issues they face, as well as areas in
which they think changes are necessary.

Step 2: Forecast future HR requirements

You will then need to look at the future HR needs of your organization and how human resources will be applied
to meet these organizational goals. HR managers will typically look at the market or sectoral trends, new
technologies that could automate certain processes, as well as industry analysis in order to gauge future
requirements. Of course, there are a number of factors affecting human resource planning such as natural
employee attrition, layoffs, likely vacancies, retirements, promotions and end of contract terms. Above all of
this, you will need to understand the goals of the organization: are you entering a new market, launching new
products or services, expanding into new areas. Forecasting HR demand is a complex task based on several
dynamics. Being informed and having a seat, or at least an ear, at boardroom level is essential if you are to
make accurate HR projections.
Step 3: Identify HR gaps
An effective human resource plan walks the fine line between supply and demand. By assessing the
current HR capacity and projecting future requirements you should have a clear picture of any gaps that
exist. Using your HR forecast you can better judge if there will be a skills gap, for example. Should you
upskill existing employees or recruit employees who are already qualified in specific areas? Are all
current employees being utilized in the right areas or would their skills be better suited to different
roles?

Step 4: Integrate the plan with your organization’s overall strategy

After you’ve assessed your current human resources capacity, projected future HR demands and
identified the gaps, the final step is to integrate your human resources plan with your organizational
strategy. On a practical level, you will need a dedicated budget for human resources recruiting, training
or redundancies, and you will also need management buy-in across the business. You will need
cooperation and the necessary finances in order to implement the plan and a collaborative approach from
all departments to put it into practice. Learn about the benefits of strategic human resource
management.
Principles of Effective HR Planning

All human resource planning has to be centered around a certain set of principles and actions.
Usually, a third party human resource consultant or employment agency plays a vital role in
planning the fundamental necessities for human resource.

 There needs to be a defined time span for the plan. A general human resource plan is often
produced to cover a period of several years in order to mitigate the problems of forecasting
variables that are imponderable. An example of a rolling plan is where a four year period of
general forecasting is conducted and then in the first year of the next plan, human resources
reviews and makes revisions for the next three years.
 Details need to be established for the strategy. For bigger organizations, it may be necessary
to have individual human resource plans and predictions for subsidiary units and functions.
However, a smaller organization could get away with having only one human resource plan
for their employees. Also, if there is a need, special provisions for recruitment or training in
the future will be necessary in human resource planning if there is a need for a certain set of
skills or jobs.
Contd….

 Human resource planning has to be in line with the most in-depth and precise information that’s
possible. Such private information is important in any case for the effective management of the
business. Details of format and contents will naturally change, but they’ll typically should include
details of age, sex, qualifications and experience and of tendencies likely to effect future forecasts,
such as job wastage, costs in occupations, salaries, etc. Independent of the routine set of data for
employees records, special analyses may occasionally be essential to provide particular information.
 Human Resource Planning has to be integrated into the other aspects of the organizations strategy
and preparation.
 Senior management must provide a lead in stressing its value throughout the organization.
 In larger organizations a central human resource planning unit accountable to senior management
must be established. The main goals of this are to co ordinate and accommodate the demands for
human resources from different departments, to standardize and supervise departmental
assessments of requirements and also to produce a complete organizational strategy. In practice, the
Human Resource and Development department would normally play a leading part in the task. In
smaller organizations these obligations would probably be completed by a senior supervisor or even
the managing director.
Factors which determine the quality of
human resources are:
1. Education and Training:
The quantity and quality of education and training received by human resources
impacts their knowledge and skills. Education and training are important for the
upliftment of both individual and society. It can be of two types, formal and informal.
Formal education is imparted through schools and colleges while informal education
and training takes place through on-the-job training methods. Formal education
stresses the transfer of theoretical knowledge, while informal education emphasizes
on practical application of knowledge.
2. Health and Nutrition:
Health and nutrition along with education are vital for Human Resource Development.
Health and nutrition impact the quality of life, productivity of labour and the average
life expectancy.
Contd….

3. Equality of Opportunity:
Not all segments of people comprising human resources get equal employment
opportunities. There is bound to be some discrimination.
The most common forms of discrimination are:
(i) Social discrimination – Discrimination on basis of gender, religion or social
standing.
(ii) Economic discrimination – Discrimination based on financial positions or
possession of wealth by the sections of workforce.
(iii) Regional discrimination – These are in form of discrimination between rural
and urban population or between people belonging to different regions/ states.
Problems of HR planning

 The main problems in the process of human resource planning are as follows:
1. Inaccuracy:
Human resource planning involves forecasting the demand for and supply of human resources. Projecting
manpower needs over a period of time is risky.It is not possible to track the current and future trends correctly
and convert the same into meaningful action guidelines.Longer the time horizon, greater is the possibility of
inaccuracy. Inaccuracy increases when departmental forecasts are merely aggregated without critical
review.Factors such as absenteeism, labour turnover, seasonal trends in demand, competitive pressures,
technological changes and a host of other factors may turn the rest of manpower plans into fashionable,
decorative pieces.
2. Uncertainties:
Technological changes and market fluctuations are uncertainties, which serve as constraints to human resource
planning. It is risky to depend upon general estimates of manpower in the face of rapid changes in environment.
3. Lack of support:
Planning is generally undertaken to improve overall efficiency. In the name of cost cutting, this may ultimately
help management weed out unwanted labour at various levels.The few efficient ones that survive such frequent
onslaughts complain about increased workload. Support from management is equally missing.
 4. Numbers’ game:
 In some companies, human resource planning is used as a numbers game. There is too much focus on
the quantitative aspect to ensure the flow of people in and out of the organisation. Such an exclusive
focus overtakes the more important dimension, i.e., the quality of human resources.

 HR planning, in the final analysis, may suffer due to an excessive focus on the quantitative aspects.

 The quality side of the coin (consisting of employee motivation, morale, career prospects, training
avenues etc.) may be discounted thoroughly.

 5. Employees Resistance:
 Employees and trade unions feel that due to widespread unemployment, people will be available for
jobs as and when required. Moreover they feel that human resource planning increases their workload
and regulates them through productivity bargaining.
6. Employers Resistance:
Employers may also resist human resource planning feeling that it increases the
cost of manpower.

7. Lack of Purpose:
Managers and human resource specialists do not fully understand human planning
process and lack a strong sense of purpose.
8. Time and Expenses:
Manpower planning is a time-consuming and expensive exercise. A good deal of
time and cost are involved in data collection and forecasting.
Requisites for Successful HRP
 i. There should be a proper linkage between HR plan and organizational plan.

 ii. Top management support is essential.

 iii. Proper balance should be kept between the qualitative and quantitative approaches to HRP.

 iv. Involvement of operating managers is necessary.

 v. Proper alignment between short-term HR plans and long-term HR plans should be there.

 vi. HR plan should have in-built flexibility in order to adopt environmental uncertainties.

 vii. Time period of HR plan should be appropriate to needs and circumstances of the
organization.