PRESENTATION ON
HUMAN RESOURCE PLANNING
GROUP I
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BETTY MATHEW
SHRADHA GARG
VISHAL VATS
PREMLATA TUTI
DAKSH AGRAWAL
ASHUTOSH SHARMA
NEHA MARWAH
MANSI SHARMA
RAVI ROSHAN DUNGDUNG
JUDE SINGH
PREETI ABHILASHA MINZ
ANKITA KEVIN NATAL
PARIMAL PARAG
Human Resource Planning is the process of forecasting a
firm’s future demand for, and supply of, the right type of
people in the right number.
HRP is the process by which management determines how
the organization should move from its current manpower
position to its desired manpower position.
ACTIVITIES REQUIRED FOR HRP
Manpower planning consists of a series of
activities:
• Forecasting future manpower requirements
• Preparing an inventory of present manpower
• Anticipating problems of manpower
• Meeting manpower requirements
FACTORS AFFECTING HRP
Organizational
growth cycles
and planning.
Type and
strategy of
organization
Time horizons
Environmental
uncertainties
HRP
Outsourcing
Labor
market
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Prevent Overstaffing and Understaffing
Ensure the organization has the right employees with the right
skills in the right place at the right times.
Ensure the organization is responsive to changes in its
environment.
Provide direction and coherence to all HR activities and
systems.
Unite the perspectives of line and staff managers
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To forecast economic and business
environment
To estimate future demand of
numbers and types of skills by
various industries
To ensure more effective
utilization of HR
To make labor supply projections
for the future
To ensure effective labor supply to
different industries through
activities such as interacting with
educational institutions.
MACRO HRP
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To prevent overstaffing and
understaffing
To ensure employee availability
To ensure that the firm is
responsive to the environment
To provide direction to al HR
activities
To build line and staff
partnerships
MICRO HRP
It Assists
Human Resource Managers to
Strategies Development Plans.
Its
Importance.
It
captures different talent
pools.
It
captures career plans and
grooms right number of
individuals.
Competitive
Business
Environment
Government
Legislations
and
Regulations
Growth of
services
economy
Significance
of HRP
Labour
Market
changes
Increase in
Productivity
Technological
Advancement
Knowledge
economy
and
knowledge
workers
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Pressure to increase revenue and cut down costs.
Firms starting to become lean.
Poaching increasingly challenges employee retention.
Increased attrition and employee turnover in industries.
E.g. Increased contractual or part time hiring.
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Jobs increasing in service sector than in manufacturing.
For e.g. shifting focus from production, chemical or civil
industry to IT, Telecom or banking.
Shift of focus from Employee skills to employee competency
and talent.
Occupational shift from manufacturing sector to knowledge
sector.
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Technologies are rapidly changing and so are their production
processes and other supporting functions.
Result is changing job specifications and descriptions.
Increased need to recruit suitable human resource at the right
time.
Several industrial sectors including manufacturing , are
becoming knowledge and skill intensive, with new
innovation resulting in quality improvements and cost
reductions.
• The numbers of jobs in manual and skilled categories are
going down in the knowledge economy.
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Competition has contributed to rising productivity. Labour
productivity in Indian industries has increased steadily since
the mid –nineties and number of workers has been declining
steadily.
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The transformation of the labour market in recent years is
another factor that has implications for HRP.
A labour market is a geographical region where the supply
and demand of labour interact.
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Government policies and regulations relating to employment
influence HRP.
Affirmative action requires firms to hire women, members of
minority groups, and disabled people. The reservation of jobs
and seats in educational institutions limits both supply and
demand.
External Environment
Internal Environment
Strategic Planning
Human Resource Planning
Forecasting
Human Resource
Requirements
Comparing
Requirements
and Availability
Forecasting
Human Resource
Availability
Demand = Supply
Surplus of
workers
Shortage
of workers
No Action
Restricted hiring,
Reduced hours,
Early retirement,
layoff,
downsizing
Recruitment
Selection
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Estimating the future quantity & quality of people required.
The basis of forecast depends upon the sales plan & the annual
budget.
HR demand forecasting considers 2 factors:
◦ Internal
◦ external
o
a)
b)
c)
d)
e)
Demand forecasting helps in :
Quantifying the jobs necessary for producing a given number
of goods & providing necessary services.
It helps to determine what staff mix is desirable in future.
Assess appropriate staffing levels to avoid unnecessary cost.
Prevent shortages of people where & when they are needed
most.
Helps the company to monitor legal compliance with regard
to reservation of jobs.
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Qualitative methods
Estimation-people in position estimate the number of people the firm
will require in the next year.
b)
Expert opinion-panel of experts forecast HR requirements for
particular future business scenarios.
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Delphi-experts go through several rounds of estimates. No face-face
meetings.
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Group brain storming-face-to-face discussion based on multiple
assumptions about future business direction.
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Nominal group technique-face-to-face discussion
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Simple averaging-simple averaging of viewpoints
c) Sales force estimates-used when new products are introduced by a
firm. Sales personnel estimates the number of employees needed based
on their estimate of demand of product.
a)
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a)
b)
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Quantitative methods.
Trend analysis and projection-based on past relationship between
a business factor related to employment and employment level itself
Simple long run trend analysis-extrapolates past relationship
between volume of business activity and the employment levels into the
future.
Regression analysis-regresses employment needs onto key variables.
Simulation models-uses probabilities of future events to estimate
future employment levels
Workload analysis-based on actual content of work
Markov analysis-probabilistic based on past relationship between
business factor related to employment and employment level itself.
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Supply forecasting – measures the number of people likely to
be available from within & outside the organization.
Reasons for supply forecasting:
Helps to quantify number of people & positions expected to be
available in future to help the organization realize its plans
Helps to clarify staff mixes that will exist in the future.
Prevents shortage of people where & when they are most needed.
Assess existing staffing levels in different parts of the organization.
Monitors expected future compliance with legal requirements of
job reservations.
Supply forecasting can be done through :
 Existing human resources
 Internal sources
 External sources
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Present employees- Analysis is facilitated by HR Audits.
The audits of non managers are called skill inventories &
those of the management are called management inventories.
With technological advancements HR inventories have
become computerized. The Human Resource Information
System(HRIS) is a computerized inventory.
N a m e : A .K . S e n
D a te p rinted :
N u m be r : 4 2 9
D e p a r tm e n t :
K e y w o rd s
1 -4 -2 00 4
41
W o rk e x p e rie n c e
W ord
D e s c r i p ti o n
A c tiv ity
F ro m
To
A c c o u n tin g
Ta x
S u pe r v is io n
1998
2 0 00
Tax c le rk
A B C C om p an y
XYZ Co.
a nd an a ly s is
B o ok K e ep in g
Ledger
S u p e rv is io n
2000
2002
A c c o u n ta n t
A u d itin g
C om pu te r
A n alys is
2002
2003
C hie f A c c o un ts T T B an k
re c o rd s
O ff i c e r
E du ca tio n
S p ec ia l Q ua lific ation s
M e m b e rs h ip s
D e gre e
M ajor
Ye a r
C ourse
D ate
1. A IM A
M BA
F in an c e
1 9 98
DBF
1 99 6
2 . IS T D
B.C om
A c c o u n ts
1995
R isk M an ag e m en t
1 9 99
3 . IC A
C o m p u te r
Languages
L i te r a c y

Ta lly

B a n k in g
F re nc h
S o ftw a re
P o s i t io n
L oc a tion
p re fe re n ce
c h o ic e
H o b b ie s
A c c o u n tin g
K o lk ata
C h es s
A ud itin g
D e lh i
F o otba ll
B a ng alor e
B o atin g
E m ploy ee s S ign atu re _ __ __ __ __ _
H R D e pa rtm en t__ __ __ __
D a te _ __ __ __ __ _ __ __ __ __ _ __ __
D ate _ __ __ __ _ __ __ __ __
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Turnover rate- number of separations during the year/
average number of employees during the year*100
Condition of work & absenteeismNumber of persons – days lost
* 100
avg no. of persons * no. of working days
Productivity level
Movement among jobs
Inflows & outflows- Determination of the number of losses &
gains is made.
S o u rce s o f In flo w s
The Firm
P ro je cte d O u tflo w s
 P ro m otion s

Tr a n s fe rs

C u rren t S ta ffing
L e ve l
 P rom o tions
 Term ina tion s
E m ploye es O ut
E m ployees In
 N e w R ecruits
 R e tire m en ts
 R e ca lls
C u rre nt
s ta ffin g
le vel
–
P ro je cted
o u tflo w s
th is yea r
Q uits
+
P ro je cted
in f lo w s
th is yea r
=

D e ath s

L ayoffs
Firm ’s in tern al
sup ply for this
tim e n ext yea r
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External hires need to be contacted when suitable internal
replacements are not available. A growing number of firms
are now using computerized Human Resource Information
Systems to track the qualifications of hundreds or thousands
of employees.
Several agencies make projections of external labor market
conditions & estimates of the supply of labor to be available
in different skill categories.
The Institute of Applied Manpower Research(IAMR)
publishes the Manpower Profile- India Yearbook.
 Why
80- 90% organizations fail to achieve their organizational long
term objectives ?
Ans. Wrong implementation of strategies.
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Recruit new permanent
employees
Rehire retirees part time
Work current staff overtime
Subcontract work out
Hire temporary employees
Redesign Job processes so that
fewer employees are needed.
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MANAGING SHORTAGES
Hiring Freezes
Do not replace those who
leave
Offer early retirement
incentives
Reduce work hours layoffs
Reduce outsourced work
Employee Training
Expand Operations
MANAGING SURPLUS
Business Strategy is the determination of the long term goals and
objectives of an organization, and allocation of resources necessary
for carrying out these goals.
 HR strategy should be aligned to business strategy to bring about
competitive advantage for the firm. The attributes, motivation,
development, priorities and performance should directly support
the company’s strategic goals. It can be done by:
 People recognized as critical to business
 Strategic Human Capital Management such as innovative
approaches to every link in the HR Value Chain- Recruitment,
Development, Motivation, Performance Management and Reward.
 Prepare business and its people to meet future demand for talent
and competition for best human resource.
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Classification by Porter(1985)
Business Strategy
Focus
HR Strategy
HRP Activities
Cost Leadership
• Job and Employee
specializations
• Employee efficiency
• Long HR planning
horizon
• Internal Promotions
• Emphasis on
Training
• Hiring and Training
for specific
capabilities
Differentiation
• Shorter HR Planning • External Staffing
Horizon
• Hire and Train for
• Hire the HR
broad competencies
capabilities required
• Flexible jobs and
employees
• Cost Control
• Stable Business
Environment
• Efficiency and
Quality
• Long term focus
• Growth
• Creative Job
behavior
• Decentralization
Classification by Miles and Snow (1984)
Business Strategy
HR Strategy
HRP
Defender
• Bureaucratic Approach
• Planned and regularly
maintained policies to
provide for lean HR
• Build HR
• Likely to emphasize
Training Programs and
Promotion
Prospector
• Creative and flexible
management style
• Have high quality HR
• Emphasize
redeployment and
flexibility of HR
• Little opportunity for
long term HRP
• Acquire HR
• Likely to emphasize
recruitment, selection
and performance based
compensation
Analyser
• Emphasize HR planning
• ‘Buy’ as well as ‘make’
key human resources
• Finds change
threatening
• Favors strategies which
encourage continuity and
security
• Thrives on change
• Favors Strategies of
product and/or market
development
• Seeks to match new
ventures with the present
business set-up
• Launches ventures new
to the firm but not new
to the market
Involves identifying key management positions that the organization
cannot afford to have vacant.
PURPOSE
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Facilitates transition when an employee leaves.
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Identifies development needs of high potential employees and assists
with their career planning
Identify key positions and possible successors for each of these positions .
For Example :J. Smith
V.P Marketing
R.Jones
Sales Director
Ready now
C.Williams
Productions Manager
15 months
S. Anderson
Director Marketing
Research
1 year
1.
To ensure that key positions remain filled.
2.
To identify critical training and development needs of both
individual managers and the organization as a whole .
Disadvantages
Do not tell
Tell
Advantages
High performers may
leave the organization ,
unsure of their future.
Allows flexibility as
business needs change
Unrealistic expectations
and implied contracts
Retention Strategy
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It is a part of planning process which anticipate the need for
groups of employees in specific , usually lower level jobs( for
ex., number of customer service representatives needed) and
the general skills employees need to ensure sustained high
performance.
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i.
ii.
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Forecasting the demand for employees
Unit forecasting ( Bottom up planning)
Top down forecasting
Plan for an adequate supply of employees
to meet the current demand.
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In unit forecasting ,each individual unit, department, or branch of
the organization estimates its future needs of the employees. For
example, each branch of a bank might prepare its own forecast
based on the goals and objectives each branch manager has for the
particular office. These estimates are then presented to subsequent
layers of the management, who combine and sum the totals and
present them to senior management for approval. This technique
has the potential for being the most responsive to the needs of the
marketplace because it places responsibility for estimating
employees needs at the “point of contact” in service provision or
product production.
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This involves senior managers allocating a budgeted amount for
employees payroll expenditures and then dividing the pool at
subsequent levels down the hierarchy. Each manager receives
budget from her/his supervisor and then decides how to allocate
these funds down to the next group of managers, this technique is
similar to sales and profit plans in many organization whereby each
unit is assigned a budgeted amount and then required to make
decisions on developing those resources in the manner most
consistent with business objectives. Although this technique may be
efficient , as senior management allocates HR costs within a strict
organization wise budget, there is no guarantee that it will be
responsive to the needs of the market place, Allocations are based
solely on what organization can afford, without regard to input
concerning demand and market place.
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Markov Analysis – It describes the probability of employees
staying with the job category, moving to another job, or
leaving the organization over a given period usually one year.
It uses a transition probability matrix that is established based
on historical trends of mobility.
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For example, we will assume that there are three job
classifications in the restaurant: servers, hosts and buspersons.
Transition probability matrix for a restaurant
Servers
.80
Servers
Current year
One year from Now
Hosts
Buspersons
.10
0
Exits
.10
Hosts
.10
.70
0
.20
Buspersons
.15
.05
.40
.40
Analysis of Matrix
Retention levels
Servers
80%
Hosts
70%
Buspersons
40%
Incumbents
60
Servers
10
Hosts
20
Buspersons
Totals
Servers
48
1
3
Forecasting levels
Hosts
Buspersons
6
7
1
8
52
14
8
Exits
6
2
8
16
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OUTSOURCING – Serves as a source of HR for a firm.
Serves as a way for filling the gaps that exist in the HR plan,
or shortage in the workforce
Decision may be driven by business objectives
There are 4 stages of the outsourcing process
1. Analysis and Evaluation
2. Contracting and Negotiation
3. Initiation and Transition
4. Stabilization and maintenance of outsourced relationship
Stage 1 – Analysis and Evaluation
 Retain HR talent
 Do not outsource HRP
 Consider alternatives to outsourcing
 Stage 2 – Contracting and Negotiation
 Evaluate Vendor organization
 Design internal organization
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Stage 3 – Transition
Employ a phased approach to transition
Build a transition team
Stage 4 – Stabilization and Improvement
Build in continuous improvement and flexibility at the
vendor
THANK YOU