HUMAN RESOURCE PLANNING
(HRP)
UNIT 10 SHRM
Ms Shabnam
LEARNING OBJECTIVES
 Define Human Resource Planning (HRP)
 Understand the nature and importance of HRP
 Analyse and evaluate the factors affecting HRP
 Critically evaluate the HRP process
Ms Shabnam
HUMAN RESOURCE PLANNING (HRP)
 Human Resource Planning (HRP) refers to the
process of evaluation and identification of HR
requirements for meeting organisational goals to
ensure competitive advantage in the marketplace.
 HRP should be a key component of nearly every
corporation’s strategic business planning.
 HRP translates the organisation’s objectives and
plans in to the number of workers needed to meet
those objectives.
Ms Shabnam
HUMAN RESOURCE PLANNING (HRP)
HRP planning approach addresses the following
questions
 How many employees do we have/need?
 How are they distributed? –Their department/
branch locations
 What is the age profile?
 How many will leave in each of the next five years?
 How many will be required in one, five, ten years?
Ms Shabnam
Characteristics of Strategic HRP
 Having adequate number of employees
 Having the right mixture of talent
 Moves beyond the traditional role of HR as primarily
an administrative control function
 Adds value to the organisation
Ms Shabnam
The Importance of Strategic HRP
 Provides a road map for future staffing requirements-provides
future personnel needs
 Business competition- to consider optimal solutions for the long-
term and under challenging economic conditions-enables to cope
with business changes
 Employee Development-documents the talents and skills of
people who are in place and creates a highly talented workforce
 Can anticipate resistance to change and re-location
Ms Shabnam
Factors that Affect HRP
 The stage of business- business growth, business
change and business decline
 Labour cost control- labour budgeting
 Impact of Technology
 Labour market trends and regulations
 Demographic trends
Ms Shabnam
Factors that Affect HRP
 Human Resources are unpredictable-they can easily
upset plans through resigning, being sick, refusing to
take up certain roles
 Surpluses and deficits are more difficult to manage
 Human Resources need careful and sensitive to
handling, which requires substantial thought and
care on the part of HR managers
Ms Shabnam
Human Resource Planning Process
The HRP process has to take account of the
organisation’s likely future demand for labour and of
the potential supply of labour
 Demand forecasting
 Supply forecasting
Ms Shabnam
Human Resource Planning Process
Demand Forecasting: This entails estimating the
organisation’s future staffing requirement in terms of
numbers and skills, by reference to its aims and
objectives and taking account of changes in working
practices and activity levels.
Supply Forecasting: This entails estimating the
likely future labour supply, both from and within the
organisation taking account of employee wastage,
current skills mix, performance, etc. and from outside
the organisation taking account of the potential pool of
staff with the right levels of knowledge and skill.
Ms Shabnam
STEPS FOR EFFECTIVE HR PLANNING
 Demand Forecasting
 Inventory Analysis and Supply Forecasting
 Audit
 Reconciliation
 Control
Ms Shabnam
STEPS FOR EFFECTIVE HR PLANNING
Inventory analysis is keeping track of the current
employees in the organisation to determine the extent
to which this meets the forecast
The HR Inventory Analysis Entails
 Skills inventory or keeping track of the number of
employees and the age, locations, qualifications, and
skills of each employee to determine the specific role
each employee would fill in the short term and in the
long term
Ms Shabnam
STEPS FOR EFFECTIVE HR PLANNING
 Forecasting resignations and recruitment and
understanding their impact on the skills inventory
levels
 Forecasting leaves, transfers, dismissals, sabbaticals,
prolonged illness
Internal supply of HR include methods such as
replacement schedules, succession planning
Ms Shabnam
AUDIT
Audit is the process of reconciling inventory with
forecast through a systematic analysis of demand and
supply forecasting and identifying areas where
shortages and surpluses exist
Ms Shabnam
AUDIT
The audit phase also involves
 Identifying reasons for resignations, the cost of such
resignations such resignations such as recruitment
and training costs of new hires, cost of lost
experience, skills and knowledge of the departing
employee and devise retention plans to retain key
talent
 Review the effectiveness of the recruitment activities,
training and development initiatives, career planning
exercises,
succession
planning
and
other
interventions
Ms Shabnam
RECONCILIATION
Action plans to bridge the gap between forecast and supply
The various alternatives include:
 Strategy to recruit new employees
 Adopting retrenchment or downsizing strategy to shed
excess workforce
 Training and development plans to right-size the
workforce
 Career planning and succession planning to identify key
personnel
 Changes in work regulation such as timings, overtime
policy etc
Ms Shabnam
CONTROL
 Monitoring and controlling the implementation of
the HR plan
This entails ensuring implementation proceeds in
accordance with the plan and also taking timely course
corrections
Ms Shabnam