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Unit 2

Learning outcome
• Manpower Planning which is also called as
Human Resource Planning consists of putting
right number of people, right kind of people at
the right place, right time, doing the right things
for which they are suited for the achievement of
goals of the organization.
• Human Resource Planning has got an important
place in the arena of industrialization. Human
Resource Planning has to be a systems approach
and is carried out in a set procedure. The
procedure is as follows:
• Analysing the current manpower inventory
• Making future manpower forecasts
• Developing employment programmes
• Design training programmes
Steps in Manpower Planning

• Analysing the current manpower inventory-

Before a manager makes forecast of future
manpower, the current manpower status has to
be analysed. For this the following things have to
be noted-
– Type of organization
– Number of departments
– Number and quantity of such departments
– Employees in these work units
• Once these factors are registered by a manager,
he goes for the future forecasting
• Making future manpower forecasts- Once the
factors affecting the future manpower
forecasts are known, planning can be done for
the future manpower requirements in several
work units.
• The Manpower forecasting techniques commonly
employed by the organizations are as follows:
– Expert Forecasts: This includes informal decisions,
formal expert surveys and Delphi technique.
– Trend Analysis: Manpower needs can be projected
through (projecting past trends), indexation (using
base year as basis), and statistical analysis (central
tendency measure).
– Work Load Analysis: It is dependent upon the nature
of work load in a department, in a branch or in a
• Work Force Analysis: Whenever production and
time period has to be analysed, due allowances
have to be made for getting net manpower
• Other methods: Several Mathematical
models, with the aid of computers are used to
forecast manpower needs, like budget and
planning analysis, regression, new venture
• Developing employment programmes- Once
the current inventory is compared with future
forecasts, the employment programmes can
be framed and developed accordingly, which
will include recruitment, selection procedures
and placement plans
• Design training programmes- These will be
based upon extent of diversification,
expansion plans, development
programmes,etc. Training programmes
depend upon the extent of improvement in
technology and advancement to take place. It
is also done to improve upon the skills,
capabilities, knowledge of the workers.
Importance of Manpower Planning

• Key to managerial functions- The four

managerial functions, i.e., planning,
organizing, directing and controlling are based
upon the manpower. Human resources help in
the implementation of all these managerial
activities. Therefore, staffing becomes a key to
all managerial functions
• Efficient utilization- Efficient management of
personnels becomes an important function in
the industrialization world of today. Seting of
large scale enterprises require management of
large scale manpower. It can be effectively
done through staffing function.
• Motivation- Staffing function not only
includes putting right men on right job, but it
also comprises of motivational programmes,
i.e., incentive plans to be framed for further
participation and employment of employees
in a concern. Therefore, all types of incentive
plans becomes an integral part of staffing
• Better human relations- A concern can
stabilize itself if human relations develop and
are strong. Human relations become strong
trough effective control, clear communication,
effective supervision and leadership in a
concern. Staffing function also looks after
training and development of the work force
which leads to co-operation and better human
• Higher productivity- Productivity level
increases when resources are utilized in best
possible manner. higher productivity is a result
of minimum wastage of time, money, efforts
and energies. This is possible through the
staffing and it's related activities (
Performance appraisal, training and
development, remuneration)
Need of Manpower Planning

• Manpower Planning is a two-phased process

because manpower planning not only
analyses the current human resources but also
makes manpower forecasts and thereby draw
employment programmes.
• Manpower Planning is advantageous to firm
in following manner
• Shortages and surpluses can be identified so
that quick action can be taken wherever
• All the recruitment and selection programmes
are based on manpower planning.
• It also helps to reduce the labour cost as
excess staff can be identified and thereby
overstaffing can be avoided
• It also helps to identify the available talents in
a concern and accordingly training
programmes can be chalked out to develop
those talents.
• It helps in growth and diversification of
business. Through manpower planning,
human resources can be readily available and
they can be utilized in best manner.
• It helps the organization to realize the
importance of manpower management which
ultimately helps in the stability of a concern.
• Types of Manpower planning
Types of manpower planning can be
distinguished:On the basis of the level at
which it is done.On the basis of the period for
which it is done.Manpower PlanningOn the
basis of levelOn period basisMacro-
tional level)(IndustrialUnit level)
• Macro-level HRP
• HRP takes place at both the macro and micro
levels. At the macro level, HRP focuses on aligning
human resources administration with the
organization’s mission and overall strategic plan.
• Often called HR strategic planning or
organizational design and development, macro HRP
examines employee management policies and
procedures and their effect on human resources
• Objectives may affect employee recruitment,
performance evaluation, compensation and
benefits, employment law compliance, labor
relations and workplace safety.
• Micro-level HRP
• Macro-level HRP drives micro-level HRP, which
develops and implements the tactics needed
to help the organization achieve its strategic
objectives. Micro HRP tactics ensure that the
business has the appropriate number of
employees with the appropriate mix of
knowledge, skills and abilities in the proper
areas or departments.
• Need for HRP at Macro Level
• Major reasons for the emphasis on HRP at macro
level include:
• Employment-Unemployment Situation: Though in
general the number of educated unemployed is on
the rise, there is acute shortage for a variety of skills.
This emphasises the need for more effective
recruitment and retaining people.
• Technological Changes: The myriad changes in
production technologies, marketing methods and
management techniques have been extensive
and rapid. Their effect has been profound on job
contents and job contexts. These changes cause
problems relating to redundancies, retraining and
redeployment. All these suggest the need to plan
manpower needs intensively and systematically.
• Organizational Changes: In the turbulent
environment marked by cyclical fluctuations and
discontinuities, the nature and pace of changes in
organizational environment, activities and
structures affect manpower requirements and
require strategic considerations
• Demographic Changes: The changing profile of the
work force in terms of age, sex, literacy , technical
inputs and social background have implications for
• Skill Shortages: Unemployment does not mean that
the labour market is a buyer’s market. Organizations
have generally become more complex and require a
wide range of specialist skills that are rare and scarce.
Problems arise when such employees leave.
• Governmental Influences: Government control and
changes in legislation with regard to affirmative action
for disadvantaged groups, working conditions and
hours of work, restrictions on women and child
employment, casual and contract labour , etc. have
stimulated the organizations to become involved in
systematic HRP.
• Legislative Controls: The days of executive
fiat and ‘hire and fire’ policies are gone. Now
legislation makes it difficult to reduce the
size of an organization quickly and cheaply.
• It is easy to increase but difficult to shed the
fat in terms of the numbers employed
because of recent changes in labour law
relating to lay-offs and closures.
• Those responsible for managing manpower
must look far ahead and thus attempt to
foresee manpower problems.
• Impact of Pressure Groups: Pressure groups such as
unions, politicians and persons displaced from land by
location of giant enterprises have been raising
contradictory pressures on enterprise management such as
internal recruitment and promotions, preference to
employees’ children, displace persons, sons of the soil etc.
• Systems Concept: The spread of systems thinking and the
advent of the macro computer as part of the on-going
revolution in information technology which emphasises
planning and newer ways of handling voluminous
personnel records.
• Lead Time: The long lead time is necessary in the selection
process and for training and deployment of the employee
to handle new knowledge and skills successfully.