Human resource planning

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Information about Human resource planning

Published on April 20, 2010

Author: achaldoshi


Slide 1: 1 Human Resource Planning Introduction : Introduction 2 Success in business is dependent on: Reacting quickly to opportunities Rapid access to accurate information Human resource planning (HR planning): How organizations assess the future supply of, and demand for, human resources Provides mechanisms to eliminate gaps that may exist between supply and demand Requires readjustment as labor market conditions change Introduction : Introduction 3 If effective utilization of human resources is not a significant goal for the organization: Employment planning is likely to be informal and slipshod If top management values stable growth: HR planning will be less important than if the goals include rapid expansion or diversification Introduction : Introduction 4 The types of people employed and the tasks they perform determine the kind of planning necessary HR planning is critical for implementation of the organization’s strategic plan HR policies have direct effects on profitability Strategic human resource management (SHRM) means acknowledging that HR policies/practices have critical links to an organization’s overall strategy The HR Planning Process : The HR Planning Process 5 The four phases or stages of HR planning: Situation analysis or environmental scanning Forecasting demand Analysis of the supply Development of action plans Situation Analysis & Environmental Scanning : Situation Analysis & Environmental Scanning 6 The first stage of HR planning is the point at which HRM and strategic planning first interact The strategic plan must adapt to environmental circumstances HRM is one of the primary mechanisms an organization can use during the adaptation process Without a plan to support recruitment and selection, it is impossible to stay competitive The problems associated with changing environments are greater today than ever before Success now depends on being a “global scanner” Forecasting Demand for Employees : Forecasting Demand for Employees 7 This phase of the process involves estimating: How many employees will be needed What kinds of employees will be needed Quantitative tools can help with forecasting, but it involves a great deal of human judgment The demand for employees is closely tied to the strategic direction that the organization has chosen Growth Reengineering Reorganization Forecasting Demand for Employees : Forecasting Demand for Employees 8 Techniques to help reduce the uncertainty inherent in HR planning: Expert estimates Trend projections Statistical modeling Unit-demand forecasting Key to effective planning is accurately and freely sharing information The Expert Estimate : The Expert Estimate 9 One or more “experts” provide the organization with demand estimates based on: Experience Guesses Intuition Subjective assessments of available economic and labor force indicators This is the least mathematically sophisticated approach Trend Projection : Trend Projection 10 This top-down technique: Develops a forecast based on a past relationship between a factor related to employment and employment itself Example: Sales levels are related to employment needs Modeling & Multiple-Predictive Techniques : Modeling & Multiple-Predictive Techniques 11 This top-down approach uses the most sophisticated forecasting and modeling techniques Trend projections relate a single factor, such as sales, to employment Environmental factors could be gross national product or discretionary income Or, the organization may be mathematically modeled so that simulations can be run Modeling & Multiple-Predictive Techniques : Modeling & Multiple-Predictive Techniques 12 Regression analysis is a mathematical procedure: It predicts the dependent variable on the basis of factors (independent variables)‏ With simple linear regression, one dependent and one independent variable are studied With multiple regression, more than one independent variable is studied Unit Demand Forecasting : Unit Demand Forecasting 13 This is a bottom-up approach Unit managers analyze current and future needs person-by-person and job-by-job Headquarters totals the unit forecasts The sum is the corporate employment forecast If both bottom-up and top-down approaches are used, the forecasts may conflict This can be resolved by averaging the variances The Delphi technique or NGT could also be used Analyzing the Current Supply of Employees : Analyzing the Current Supply of Employees 14 This phase of HR planning should answer the question: “How many and what kinds of employees do I currently have, in terms of the skills and training necessary for the future?” This involves more than simply counting current employees The smaller and more centralized the organization, the easier it is to conduct a skills inventory The Skills Inventory : The Skills Inventory 15 Both a skills inventory and a management inventory: Identify the skills, abilities, experiences, and training employees currently have Are useful for career planning, management development, and related activities In its simplest form, a skills inventory is a list of: Names Characteristics Skills The Skills Inventory : The Skills Inventory 16 Skills inventories vary greatly in their sophistication Some are as simple as a file drawer of index cards Others involve expensive and complex computer databases Contents of the Skills Inventory : Contents of the Skills Inventory 17 The only data available to the organization for later use is what was designed into the system Contents of the Skills Inventory : Contents of the Skills Inventory 18 Often omitted, but increasingly important, are: Employees’ stated career goals Geographical preferences Intended retirement date The main categories within a skills inventory: Data summarizing the employee’s past Data summarizing present skills Data that focus on the future Today, many skills inventories are more complex Maintaining the Skills Inventory : Maintaining the Skills Inventory 19 The two principal methods for gathering data: the interview and the questionnaire The questionnaire is faster and cheaper, but can be inaccurate Some contend that a trained interviewer can complete questionnaires more quickly and accurately Plans for keeping files updated must be made The more often changes are made and the data is used, the more often updates should be performed Maintaining the Skills Inventory : Maintaining the Skills Inventory 20 Should data be stored in a manual system or on a computer? How much does the computer system cost? How frequently the data will be used? A computer allows comparative analysis over time Skills inventories are useful only if management uses the data to make significant decisions Before accessing the data, managers must be trained to avoid abuse of the system Action Decisions in HR Planning : Action Decisions in HR Planning 21 After the supply of and demand for workers has been analyzed, the two forecasts must be compared Whenever there is a gap between the two estimates, a course of action must be chosen Action Decisions in HR Planning : Action Decisions in HR Planning 22 If the supply of workers is less than the demand: It can be filled with present employees who are willing to work overtime If there is a shortage of skilled employees: Train and/or promote present employees Recruit less-skilled employees Recall employees who were previously laid off Action Decisions in HR Planning : Action Decisions in HR Planning 23 Organizations are using more: Part-time workers Subcontractors Independent professionals This is in response to: Intense global competition Rapid technological change Fears caused by recent workforce reductions Over 5 million U.S. citizens are contingent workers Action Decisions in HR Planning : Action Decisions in HR Planning 24 Possible solutions to an employee surplus: Attrition Early retirements Demotions Layoffs Terminations Employees who are considered surplus are seldom responsible for the conditions leading to the surplus Action Decisions in HR Planning : Action Decisions in HR Planning 25 Most organizations avoid layoffs by using attrition, early retirement, creation of work, and so on Attrition can be accelerated by encouraging employees to leave early Drawbacks to losing workers over the age of 50: They tend to be healthier than younger workers They have fewer work-related injuries They are less likely to change jobs They take critical skills and experience with them Action Decisions in HR Planning : Action Decisions in HR Planning 26 By 2010, the median age of the U.S. workforce will be 40.6 years Over half the workforce will be protected by the Age Discrimination in Employment Act Promises should not be made that can’t be kept Once promised, it may be illegal to change them Action Decisions in HR Planning : Action Decisions in HR Planning 27 If voluntary reductions don’t eliminate the gap between supply and demand, layoffs may be necessary Corporations too frequently and quickly turn to layoffs They fail to consider the consequences About one-third lay off too many workers Poorly designed workforce reductions can kill morale Human Resource Information Systems : Human Resource Information Systems 28 Information is the key to successful HR planning A human resource information system (HRIS) is an integrated way to acquire, store, analyze, and control information flow through an organization A highly developed HRIS can increase the efficiency and response times of: Tracking applicants Skills inventory Career planning Employee service programs Human Resource Information Systems : Human Resource Information Systems 29 Computer technology makes it possible to integrate multiple HR needs into a single system: Enrolling in benefits programs Processing employee transactions (pay increases)‏ Using learning modules An HRIS developed for use by upper-level executives is called an executive information system (EISs)‏ Computerized HRISs have allowed organizations to broaden their view of succession planning Human Resource Information Systems : Human Resource Information Systems 30 Factors that make succession planning for executive level positions more important than ever: Large numbers of aging executives Increasingly popular early retirement Fortune 500 companies anticipate 33 percent turnover among their executives over the next five years Many companies now realize the critical need for a comprehensive retention plan This plan may include consulting and part-time assignments

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