PEOPLE RESOURCING
Chapter Six
Human Resource Planning:
Relevance and Debates
The use of HR planning in practice
Few employers actually give the function a high profile.
In a 1990 CIPD study, only three planning activities were
found to be undertaken formally and regularly by most
employers: identification of future training needs;
analysis of labour costs and productivity; and
assessment of the need for structural change resulting
from business plans.
Fewer than half carried out formal forecasts of supply
and demand of labour, and less than 20 per cent formally
monitored HR planning practices
A variety of reasons have been put forward to explain the
apparent abandonment of HR planning techniques:
•
Hostility to the use of statistical techniques in place of
managerial judgement
•
The view that while desirable, HR planning is not essential to
organisational effectiveness – with funding therefore being
diverted elsewhere
•
The prevalence of a short-termist outlook in UK industry. Longterm planning is often neglected because it is unlikely to
enhance individual management careers
•
Practical problems associated with inadequate historical data on
which to base forecasts
•
Ignorance of the existence of HR planning techniques, and of
mathematical methods in general
•
Traditional planning no longer ‘fits’ the modern approach to
management – shorter time horizons and a focus on flexibility.
The case against HR planning
•
The main problem with forecasting is its reliance on past
experience to predict future developments. This means
that one-off events which fundamentally alter the
environment cannot be included in the forecasts.
•
Although relevant in the 1960s and 1970s in the context of
a relatively stable business environment, it is no longer
applicable in the increasingly unpredictable world of the
twenty-first century.
•
Competitive advantage today, according to HR planning
critics, comes from generating responses to fast-changing
circumstances that are swifter, more creative, and more
flexible than those of competitors – qualities that are stifled
by the characteristics of the planning process.
The case for HR planning
•
The need to view plans as adaptable.
•
Turbulence requires more attention to planning. It is both
possible and desirable to plan for uncertainty. The
emphasis in HR planning will be on maximum future
flexibility.
•
The objectives of HRP all play a useful role in the
management of organisations:
-
recruitment
training and development
staff costing
redundancy (allowing remedial action and mitigating the
extent)
collective bargaining
accommodation (office space, car parking, etc).
Adapting traditional HR planning
•
Micro-planning: concentrating on defined staff groups
•
Contingency planning: preparing possible responses to a
variety of potential environmental developments
•
Succession planning: focusing on the recruitment and
development of individuals to fill the top few posts in an
organisation as they become vacant
•
Skills planning: predicting what competencies will be
needed one to five years from now, leaving open the
question of the form in which these will be obtained (which
may include temporary staff, contractors and consultants)
•
Soft human resource planning: forecasting the likely
supply of and demand for particular attitudes and
behaviours rather than people and skills.
HR planning in an international context
The globalisation of organisations has a number of direct
implications for the HR planning function:
•
the requirement for language skills
•
the need to move skilled employees and managers from country
to country
•
inherent instability associated with international business activity
•
varying labour market conditions and cultural norms.
To be effective in an international company, there should
be an HR planning function in every region/country,
each focusing on developments in its own labour
market and reporting to a central coordinating
department.
Evaluating HR planning processes
Three criteria for evaluation:
•
The extent to which the outputs of HR planning programmes
continue to meet changing circumstances
•
The extent to which programmes achieve their cost and
productivity objectives
•
The extent to which strategies and programmes are re-planned
to meet changing circumstances.
It is hard to effectively evaluate HR planning because
activities are not one-off affairs – planning is an
ongoing activity in which forecasts are continually
reviewed.
It is the effectiveness of strategies developed on the
back of the HR planning process that provides the
most meaningful evaluation criteria.