Definition of Human Resource Planning Human Resource Planning: the right number of employees with the right level

of talent and skills in the right jobs at the right time performing the right activities to achieve the right objectives to fulfill the Corporate Vision. As defined by Bulla and Scott (1994), it is the process for ensuring that the human resource requirements of an organization are identified and plans are made for satisfying those requirements. Human resource planning is based on the belief that people are an organizations most important strategic resource. It is generally concerned with matching resources to business needs in the longer term, although it will sometimes address shorter term requirements. Human resource planning should be an integral part of business planning. The strategic planning process defines projected changes in the types of activities carried out by the organization and the scale of those activities. It identifies the core competences the organization needs to achieve its goals and therefore its resources and skill requirements. Human resource planning interprets these plans in terms of people requirements. As Quinn Mills indicates, human resource planning is a decision-making process that combines three important activities: 1. Identifying and acquiring the right number of people with the proper skills, 2. Motivating them to achieve high performance, and 3. Creating interactive links between business objectives and people-planning activities. However, it must be recognized that although the notion of human resource planning is well established in the HRM vocabulary it does not seem to be established as a key HR activity. As Rothwell (1995) suggests: Apart from isolated examples, there has been little research evidence of increased use or of its success. She explains the gap between theory and practice as arising from: the impact of change and the difficulty of predicting the future the need for planning may be the inverse proportion to its feasibility: the shifting kaleidoscope of policy priorities and strategies within organizations;

the distrust displayed by many managers of theory or planning - they often prefer pragmatic adaptation to conceptualization; the lack of evidence that human resource planning really works.

Aims of Human Resource Planning The aims of human resource planning are to ensure that the organization: obtains and retains the number of people it needs with the skills, expertise and competences required; makes the best use of its human resources; is able to anticipate the problems of potential surpluses or deficits of people; can develop a well-trained and flexible workforce, thus contributing to the organizations ability to adapt to an uncertain and changing environment; reduces its dependence on external recruitment when key skills are in short reply- this means formulating retention, as well as employee development, strategies. Achieving the aims HRP is usually assumed to consist of four clear steps: forecasting future needs; analysing the availability and supply of people; drawing up plans to match supply to demand; monitoring the implementation of the plan

As Casson (1978) pointed out, this conventional wisdom represents human resource planning as an all-embracing, policy-making activity producing, on a rolling basis, precise forecasts using technically sophisticated and highly integrated planning systems. But he suggests that it is better as:

a regular monitoring activity, through which human resource stocks and flows and either relationship to business needs can be better understood, assessed and controlled, problems highlighted and a base established from which to respond to unforeseen events.

An investigatory activity by which the human resource implications of particular problems and change situations can be explored and the effects of alternative policies and actions investigated.

The aims of HRM can be achieved through the following activities: Resource Strategy Turning broad strategies into actions plans Demand forecasting Supply forecasting- analyzing existing resources, employee turnover and wastage, analyzing the effect of promotions and transfers, analyzing changes in conditions of work and absenteeism, analyzing sources of supply etc.

Implementation Strategies These consist of: acquisition strategies, which define how the resources required to meet forecast needs will be obtained; retention strategies, which indicate how the organization intends to keep the people it wants; development strategies, which describe what needs to be done to extend and increase skills (multi-skilling) to fit people for greater responsibility, and also define the outputs required from training programs; utilization strategies, which indicate intentions to improve productivity and cost effectiveness;

flexibility strategies, which show how the organization can develop more flexible work arrangements; downsizing strategies, which define what needs to be done to reduce the numbers employed.

The basis of employee resourcing strategies The basis for employee resourcing strategies is provided by longer-term business plans and shorter-term budgets and programmes. These indicate further activity levels, new demands for skills and competences and intentions to take cost out of business by reducing the size of the workforce, delayering, subcontracting work or relying more on outworkers, or part-timers. The business strategies, plans and budgets define demand requirements. But the strategy must also deal with the supply side, from within and outside the organization. Internal supply-side planning means forecasting the output of training schemes and losses through employee turnover. The impact of absenteeism also has to be considered. External supply-side planning means looking at demographics- the likely supply of school leavers, professionally qualified staff and university graduates entering the local and national labour market.

Demand Forecasting Demand forecasting is the process of estimating the future numbers of people required and the likely skills and competences they will need. The basis of the forecasting is the annual budget and longer-term business plan, translated into activity levels for each function and department or decisions on downsizing. Details are required of any organization plans that would results in increased or decreased demands for employees.

Demand forecasting methods

There are four basic demand forecasting methods for estimating the numbers of people required: Managerial judgment Ratio-trend analysis Work study techniques Modeling

Managerial Judgment The most typical method of forecasting used is managerial judgment. This simply requires managers to sit down, think about their future workloads, and decide how many people they need. It might be done on a bottom-up basis, with line managers submitting proposals for agreement by senior management. Alternatively, a top-down approach can be used, in which company and department forecasts are prepared by top management, possibly acting on advice from the personnel departments. These forecasts are reviewed and agreed with department managers. A less directive approach is for top management to prepare planning guidelines for departmental managers, setting out the planning assumptions and the targets they should try to meet.

Modeling Mathematical modeling techniques using computers and spreadsheets can help in the preparation of demand and supply forecasts.

Forecasting skills and competence requirements Forecasting skill and competence requirements is largely a matter of managerial judgment. This judgment should, however, be exercised on the basis of a careful analysis of the impact of

projected, product-market developments and the introduction of new technology, either information technology, computerized production methods such as manufacturing requirements planning (MRP2) or computer integrated manufacturing (CIM), or some form of automation or robotics.

Supply Forecasting Human resources comprise the total effective effort that can be put to work as shown by the number of people and hours of work available, the capacity of employees to do the work and their productivity. Supply forecasting measures the number of people likely to be available from within and outside the organization, having allowed for absenteeism, internal movements and promotions, wastage and changes in hours and other conditions of work. The supply analysis covers: Existing human resources; Potential losses to existing resources through employee wastage; Potential changes to existing resources through internal promotions; Effect of changing conditions of work and absenteeism; Sources of supply within the organization; Sources of supply from outside the organization in the national and local labour markets.