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HUMAN RESOURCE PLANNING
MBA I YR
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HR Planning
What is HR Planning?
Why is it done?
What is the connection between a firms strategic
orientation and HR planning? Impact ?
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Organizational Life-Cycle Stages and HRActivities
LIFE-CYCLE
STAGE STAFFING COMPENSATION
TRAINING AND
DEVELOPMENT
LABOR /
EMPLOYEE
RELATIONS
Introduction Attract best technical
and professionaltalent.
Meet or exceed labor
market rates to attractneeded talent.
Define future skill
requirements andbegin establishing
career ladders.
Set basic
employee-relations
philosophy of
organization.
Growth Recruit adequate
numbers and mix of
qualifies workers.Plan management
succession. Manage
rapid internal labor
market movements
Meet external market
but consider internal
equity effects. Establishformal compensation
structures.
Mold effective
management team
throughmanagement
development and
organizational
development.
Maintain labor
peace,
employeemotivation, and
morale.
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Organizational Life-Cycle Stagesand HR Activities (contd)
LIFE-CYCLE
STAGE STAFFING COMPENSATION
TRAINING AND
DEVELOPMENT
LABOR /
EMPLOYEE
RELATIONS
Maturity Encourage sufficient
turnover to minimize
layoffs and provide new
openings. Encourage
mobility as
reorganizations shift
jobs around.
Control
compensation costs.
Maintain flexibility and
skills of an aging
workforce.
Control labor costs
and maintain labor
peace. Improve
productivity.
Decline Plan and implement
workforce reductions
and reallocations,
downsizing and
outplacement may
occur during this stage.
Implement tighter
cost control.
Implement retraining
and career consulting
services.
Improve productivity
and achieve flexibility
in work rules.
Negotiate job
security and
employment-
adjustment policies
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FORECASTING DEMAND
Human Resource Planning Model
Considerations
Product/service demand
Technology
Financial resources
Absenteeism/turnover
Organizational growth
Management philosophy
Techniques
Trend analysis
Managerial estimates
Delphi technique
Techniques
Staffing tables
Markov analysis
Skills inventories
Management inventories
Replacement charts
Succession Planning
External Considerations
Demographic changes
Education of the workforce
Labor Mobility
Government policies
Unemployment rate
FORECASTING SUPPLY
BALANCING
SUPPLY AND
DEMAND
(Shortage)
Recruitment Full-time
Part-time
Recalls
(Surplus)
Reductions
Layoffs
Terminations
Demotions
Retirements
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Forecasting Demand for Employees
Quantitative Methods
Qualitative Methods
Forecasting Demand
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How does HR Planning occur?
1. What does the environment look like?
2. What are our future personnel needs?
(forecast demand)
a. Judgmental/Qualitative
Estimates
Rule of Thumb Delphi Technique
NGT
Brainstorming
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Qualitative Approaches to DemandForecasting
Management Forecasts
The opinions (judgments) of supervisors, department
managers, experts, or others knowledgeable about the
organizations future employment needs. Delphi Technique
An attempt to decrease the subjectivity of forecasts by
soliciting and summarizing the judgments of a preselected
group of individuals.The final forecast represents a composite group judgment.
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Forecasting Demand for Employees
Quantitative Methods
Qualitative Methods
Forecasting Demand
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Quantitative Approach: Trend Analysis
Forecasting labor demand based on an organizationalindex such as sales:
Select a business factor that best predicts human resources
needs.
Plot the business factor in relation to the number of
employees to determine the labor productivity ratio.
Compute the productivity ratio for the past five years.
Calculate human resources demand by multiplying the
business factor by the productivity ratio.
Project human resources demand out to the target year(s).
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Quantitative Methods Ratio Analysis
Trend Analysis
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Example of Trend Analysis of HR Demand
2005 2,351 14.33 164
2006 2,613 11.12 235
2007 2,935 8.34 352
2008 3,306 10.02 330
2009 3,613 11.12 325
2010 3,748 11.12 337
2011 3,880 12.52 310
2012* 4,095 12.52 327
2013* 4,283 12.52 342
2014* 4,446 12.52 355
BUSINESS
LABOR = HUMAN RESOURCESFACTOR PRODUCTIVITY DEMANDYEAR (SALES IN THOUSANDS) (SALES/EMPLOYEE) (NUMBER OF EMPLOYEES)
*Projected figures
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Forecasting Supply of Employees: InternalLabor Supply
Staffing Tables
Markov Analysis
Skill Inventories Replacement Charts
Succession Planning
Are resources availableinternally or externally
to fill those needs?
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Employee Replacement Chart forSuccession Planning
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How does HR Planning occur?
3. Are resources availableinternally or externallyto
fill those needs?
a. Internal
Replacement charts
Promotability
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How does HR Planning occur?
3. Are resources availableinternally or externallyto
fill those needs?
a. Internal
Replacement charts
Promotability
Succession planning
Skills inventory
Transition (Markov) matrix
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Forecasting Internal Labor Supply
Staffing TablesGraphic representations of all organizational jobs, along
with the numbers of employees currently occupying those
jobs and future (monthly or yearly) employment
requirements.
Markov Analysis
A method for tracking the pattern of employee movements
through various jobs.
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Hypothetical Markov Analysis for a Retail Company
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Internal Demand Forecasting Tools
Skill InventoriesFiles of personnel education, experience, interests, skills,
etc., that allow managers to quickly match job openings
with employee backgrounds.
Replacement ChartsListings of current jobholders and persons who are
potential replacements if an opening occurs.
Succession Planning
The process of identifying, developing, and tracking key
individuals for executive positions.
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An ExecutiveReplacement
Chart
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How does HR Planning occur?
3. Are resources availableinternally or externallyto
fill those needs?
b. Externalwhat do you look at?
- try to determine availability of qualified
labor; Surplus? Shortage?
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How does HR Planning occur?
4. What should we do?
- create plan of action to reconcile supply and deman
a. Set objectives
b. Generate alternatives
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Staffing Alternatives to Deal with EmployeeSurpluses
Source: Compliments of Dan Ward, GTE Corporation
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Staffing Alternatives to Deal with EmployeeShortages
Source: Compliments of Dan Ward, GTE Corporation
l h d l
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Alternative Scheduling Options
Alternative
Percent Using
(N = 427 companies)
The following definitions were used in this survey
for alternative scheduling strategies:
Part-time: A regular employee who works fewer than 35 hours per
week.
Flextime: A system than enables employees to vary their schedules:
Usually, the flexibility applies to starting and finishing times.
Compressed workweek: A full-week schedule (usually 40 hours) than
occurs in fewer than five days, such as four 10-hour days.Job sharing: Two or more employees split a full-time position, diving
the responsibilities, and, to some degree, the compensation.
Work-at-home: A program that enables employees to complete work at
home (or at a remote office closer to home) on a regular basis. It is often
referred to as flexplace or telecommuting.
84%
40%
23%
18%
13%
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How does HR Planning occur?
5. How did we do?
a. Did company avoid surplus/shortage?
b. Evaluate usefulness of methods used
c. Goals v. Production Levels, etc.
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