Professional Documents
Culture Documents
Prof. B D Singh
IMT, Ghaziabad
Andrew
Carnegie
• Strategic planning: the systematic determination of goals
and the
plans to achieve them
2. Labour market
- Global Labour market
- Diverse one
- Out sourcing
- Flexible work arrangement
3. Political And Legislative Factors
- Pay equity
- Work force rights
4. Technology
E – Commerce
- Convergence of work
5. Social
12.Stakeholders
- Union
- Public
- Customer
- Supplier
- Top Management
Environmental Scanning Sources and Methods
Trend Analysis
Delphi Technique
Environmental Factors
7. Economic Climate
8. From the industrial Revolution to the Knowledge
Revolution
9. Globalization
10.The Labour Market
11.Political and Legislative Factors
12.Technological Factors
13.Demographic Factors
14.Social and Cultural Factors
15.Stakeholders
Stakeholders
Stakeholder groups of people who have vested interests in an
organization’s decisions
7. Cut Cost
8. Succession planning
RESPONSIBILITY FOR HUMAN RESOUCE PLANING
Formulation of human resource plans is a shared task
between top management line managers and HR
department
Top management is involved in HRP process because
ultimately, it approves various plans of the organisation
as a whole.
Functional managers under whom people work.
The responsibilities of HR department in regard to HRP
process have been described by Geisler as follows:
– To assists, counsel and pressurize the operating management
to plan and establish objectives;
– To collect and summaries data in total organizational terms and
to ensure consistency with tong-term objectives and other
elements of the total elements of the total business plan;
– To monitor and measure performance against the plan and
keep the top management informed about it
– To provide research necessary for effective manpower and
organisational planning
– Responsibility for HRP at Hindustan Lever- Top Managers, Line
Human resource planning process
HRP is a process and it proceeds through various
interrelated activities.
Forecasting future manpower requirements,
either in terms of mathematical projection of
trends in the economy and developments in the
industry or of judgmental estimates based upon
specific future plans of the company.
Inventorying present manpower resources and
analyzing the degree to which these resources
are employed optimally;
Anticipating manpower problems by projecting
present resources into the future and comparing
them with the forecast of the requirements, to
determine their adequacy, both quantitatively
and qualitatively and
Planning the necessary programmes of
recruitment, selection, training deployment,
utilization, transfer, promotion, development.
Motivation and compensation so that future
Human Resource
. Planning
Organizational objectives
Human
resource
planning Forecasting
Forecasting needs
supply of human
for Human
Identification resources
resources
of human
resource gap
Surplus human Shortage of human
resources resources
Action plans
for bridging
Monitoring &
control
Review Process
– HR Audit
Organizational Objectives, Plans and Policies :
Objectives generate various plans an policies which
provide direction for future course of action. Out of
this direction, various subsystems of the organization
devise their own plans and programmes. While going
through the process of HRP, organizational policies
with regard to effective utilization of human resources
should be identified and incorporated in planning
process. Specifically, following questions are important
in this regard:
1. Are vacancies to be filed by promotions form within or by
hiring form outside?
2. How do the training and development objectives interface with
the HRP objectives?
3. What union constraints are encountered in HRP and what
policies are needed to handled these constraints?
4. How to enrich employee’s job? Should the routine and boring jobs
continue or be eliminated?
5. How to downsize the organization to make it more competitive?
6. To what extent production and operations be automated and what
can be done about those displaced?
7. How to ensure continuous availability of adaptive and flexible
workforce?
8. Outsourcing- Contracting?
Job Description
The data collected for job analysis provide the basis for
preparing job description for each job. This functional
description describes what the job entails. Although there
is no standard format for a job description, it usually
includes:
7. Job title - a title of the job.
8. Job summary – a brief statement of what the job entails.
3. Job activities – a description of the tasks performed,
material used and extent of supervision given or
received.
4. Working conditions and physical environment – heat,
light noise level, hazards are described.
5. Social environment – Information on size of work group
and interpersonal inter-actions required to perform the
job.
Job Specification
5. Current forecast
6. Short-run forecast
7. Medium-run forecast
8. Long-run forecast
5. Determine HR Demand
6. Ascertain HR Supply
Internal supply – refers to current members of the
organizational workforce who can be retrained, promoted,
transferred, etc. to fill anticipated future HR requirements.
Assumptions of
social environment
Assumptio Business
ns of plans
political
DEMAND
environme
FORECASTING
nt
EXERCISE
Assumption Assumptions
s of of labour
technology market
conditions Assumption
s of
economic
trends
Issues in demand forecasting
Social Factors
Technologies Factors
Political Factors
Economic factors
Demand Generation
Growth
Employee Turnover
There are several good reasons to conduct demand
forecasting. It can help:
10. Quantify of the jobs necessary for producing a given
number of goods, or offering a given amount of services
11. Determine what staff-mix is desirable in the future
12. Assess appropriate staffing levels in different parts of the
organization so as to avoid unnecessary costs
13. Prevent shortages of people where and when they are
needed most
14. Monitor compliance with legal requirements with regard to
reservation of jobs
Forecasting techniques
Forecasting techniques vary from simple to
sophisticated ones. Before describing
each technique, it may be stated that
organisation generally follow more than
one technique.
The techniques are:
4. Managerial judgment
5. Ratio-trend analysis
6. Work study techniques
7. Delphi technique
8. Flow models
9. Others
Managerial Judgement: This technique is very simple. In
this, managers sit together, discuss and arrive at a figure,
which would be the future demand for labour. The
technique may involve a ‘bottom-up’ or a ‘top-down’
approach. In the first, line managers submit their
departmental proposals to top managers who arrive at the
company forecasts. In the ‘top down’ approach, top
managers prepare company and departmental forecasts.
These forecasts are reviewed with departmental heads and
agreed upon. Neither of these approaches is accurate- a
combination of the two could yield positive results. In the
‘bottom-up’ and ‘top-down’ approaches, departmental
heads are provided with broad guidelines. Armed with such
guidelines, and a consultation with the HRP section in the
HRM department, departmental managers can prepare
forecasts for their respective departments. Simultaneously
top HR managers prepare company forecasts. A committee
comprising departmental managers and HR managers will
review the two sets of forecasts, arrive at a unanimity,
which is then presented to top managers for their approval.
Ratio –trend Analysis
This is the quickest forecasting technique. The technique involves
studying past ratio, say, between the number of workers and sales
in an organization and forecasting future ratios, making some
allowance for changes in the organization or its methods. Exhibit 4
shows how an analysis of actual and forecast ratios, between the
number of routine proposals to be processed by an insurance
company’s writing department and the number of writers
employed could be used to forecast future requirements.
Exhibit 4 : Demand Forecast- Inspectors
Year Production No. of Employees Ratio
Inspector :
-3 1500 150 1:10
Actual -2 1800 180 1:10
Last Year 2000 180 1:11
Next Year 2200 200 1:11
+2 2500 210 1:12
+3 2750 230 1:12
Simple Mathematical Methods
Regression analysis:
Retention plan –
10. Adjustment of the salary levels with those of the comparable industries
so as to remove inequalities.
11. Providing opportunities for career development, provide training facilities
adopting the policy of promoting from within, more systematic
promotional procedure, providing opportunities for self-development,
assignment of challenging work, etc.
12. Introduction of effective consultation and negotiating machinery,
encouragement of grievance redressing and conflict resolution rather
than suppressing.
13. Providing of extensive training and development facilities. Encouraging
the employees to participate in the management, development
programmes and training programmes both within and outside the
organisation.
And programmes should be effective in meeting not
only organisational but individual needs.
5. Selection procedure should meet the job and
organisation requirements not only for the
present position to which the candidate has
applied but also his potentialities for future jobs
in the career line.
6. Provide more conducive working conditions and
extensive fringe benefits
7. Provide the scope for extensive participation of
the employee in decision-making and create the
environment that the system in the organization
is participative management but not autocratic
management.
8. Provide the facilities and environment for
conducive interpersonal relations.
9. Provide the scope for challenging, creative and
innovative work.
10. Work life-balance.
Identification of Human Resource
Gap
Gap analysis is the process of comparing
the workforce Demand Forecast to the
workforce Supply Projection. A gap
(projected supply is less than forecasted
demand) indicates a future shortage of
needed employees. A surplus (projected
supply is greater than forecasted demand)
indicates a future excess in some
categories of employees which may also
require action.
HR STAFFING
Managing HR Gap
Demand Forecast Supply
Forecast
HR Gap
Shortage Excess/
Surplus
Two types of HR Planning for managing gap
1. Aggregate Planning
2. Succession Planning
Increase Subcontract
Increase productivity
Temporary Assignment
Temporary Leaves
Transfers (temporary)
Strategy Development
– Phelps had defined unstructured labour market “as one which contains
few, if any, established intitutions by means of which people obtain
market information, move into and out of jobs, qualify for advances in
rank or identify themselves with any type of organisation”.
Job discrimination
– Discrimination means the act of making distinctions
among people or groups of people. For example, a
discriminating employer may make a distinction
between men and women for a job and choose only
male applicants
Religious Discrimination
– In USA at the early days there was religious
discrimination because early settlers often came to
America to escape from the religious persecution in
Europe.
Racial Discrimination
– In India there is no racial discrimination in the job
market.
The Older Worker
– By the year 2000 there will be higher proportion of aged people in the
labour force than they are now. Little attention has been given to the
older workers who are mostly above 65. In USA one-tenth Americans
is over 65 years of age.
Job engineering and job reassignment. These are two things which
companies can accomplish to help the older worker. Job
engineering refers to redesigning the work stations so that the
work can be done in a way that is les taxing on the employee. The
work should be planned in such a way that it could be done in a
sitting posture, reducing body movement or changing the flow of
work. Job reassignment is moving the person into a different
position in which the task does not demand so much in terms of
dexterity or speed but just as rewarding. Older workers can
become good trainers and set up men as well as rework rejects
from the production line.
Finding employment after the age of forty become more difficult
for the following reasons:
Seniority and policies of promotion
The decline in self-employment
Closing of plants force older
Retirement age to fifty through VRS
Employment of Women
– Women’s liberation movement all over
the world has changed the attitudes of
women towards the job. Again, equal
pay for equal work has become a law in
most of the developed countries.
– Employment of handicapped
InIndia it is a policy of the Govt. to reserve
2 percent vacancies for the physically
handicapped.
Feedback: 10%
Pay above market 8%
Telecommuting 8%
Tapping exit interviews
It’s a last ditch effort but India Inc is making it
nevertheless. The customary exit interviews are
being taken seriously & companies are using them to
offer:
Immediate
Compensation hikes 23%
Pay revisions 35%
Immediate role
Enhancement 36%
Immediate change
In role 50%
Improved work
Life balance 55%
Improved work
environment 55%
Commitment to
Career progression 70%
Long Term
1.
Recruit Permanent Employees
c. Government policies
d. Personnel policies of other competing organisations;
e. Organisation’s personnel policies;
f. Recruitment sources;
g. Recruitment needs;
h. Recruitment cost;
i. Selection criteria and preference etc
Source of Recruitment
Internal Sources : Internal source include:
o. Present permanent employees,
p. Present temporary/casual employees,
q. Retrenched or retired employees,
r. Dependents of decreased, disabled, retired and present
employees.
External Sources
Advantages
Have performance data available
Motivational
Less training/socialization time
Faster
Less Expensive
Disadvantages
Possible politics
Inbreeding
External
Advantages
Fresh Ideas and view points
Expand knowledge base
Disadvantages
Unknown entities
Detrimental to internal applicants
Training and socialization time
Time- consuming
Can be expensive
Methods of Recruiting
Small organisations often do their recruiting very
informally, by work of mouth allowing the direct
supervisor to find someone of his or her own
choosing
Ina computrised database, the skills inventory
component of the human resource information
system can be used to assist in internal
recruiting.
External recruiting may also be done informally
through contact with friends, acquaintances of
existing employees
Advertising in selected media
Internet is one of the fastest-growing recruitment
methods
Internet gives an employer global exposure to
potential applicants, which can be critical if
particular language skills or cultural backgrounds
are needed.
Employment agencies, more commonly
called staffing agencies or staffing services
State job service agencies are publically
funded by the federal government
Private Industry Council
Recruitment
Application Form
Written Examination
Preliminary Interview
Group Discussion
Tests
Medical Examination
Reference Checks
Employment
INTERNATIONAL ASSIGNMENTS
To ensure the success of overseas
assignments, employers are increasingly
testing employees, adaptability, open-
mindedness, ability to tolerate uncertainty
and ambiguity, and independence.
Similarly, many are also interviewing and
screening family member adaptation
either require the employee to return
home before the end of the assignment or
have a negative impact on the employee’s
performance. Screening employees as part
of staffing international operation has
consequently become much more
elaborate and strategic to ensure the
success of the assignment.
COMPETENCY MAPPING –A TOOL
FOR OPTIMIZING HUMAN CAPITAL
Outsourcing
Goals
Outsourcing refers to a contractual relationship for the provision of
business services by an external provider. In other words, a
company pays another company to do some work for it. Currently,
outsourcing is being promoted as one of the most powerful trends
reshaping management. However, organizations have always
outsourced some functions.
Outsourcing
Outsourcing the practice of one organization contracting with
another organization to provide services or products.
Outsourcing HR functions
• Payroll • Advertisements
• Benefits • Screening of applications
• Compensation administration • Testing
• Pension • Reference checking
• Preliminary interviews
Training • Salary negotiations- at the executive
• Program delivery level
• Program design and development • Exit interviews
• Training consulting to line departments
• Training needs analysis Health and Safety
• Program Evaluation
• Strategic Planning for T & D • Employees assistance program
• Administration • Wellness programs
• Developing training policy
Small Business and HR Outsourcing
Improved Service:
Quality improvement is cited as another benefit of outsourcing.
Performance standards can be written into the contract more tightly
than may be possible with current and long-tenured employees.
Managers can choose the “best of breed” vendors that have
outstanding track records and more flexibility in hiring and rewarding
their employees
Service Risks
Employee Morale
Reduced Value
Management of Outsourcing
Summary:
Behavioral aspects
– Ability to work in groups or work as a
team
– Ability to initiate talks
– Ability to understand other’s problems
– Ability to empathize with others
– Courage to apologize on committing
mistakes.
Negotiating Ability
Negotiating Ability
Behavioral aspects
– Ability to reason
– Ability to be ethical during the process
– Ability to predict the next argument of
opponents
– Ability to survive till the end and not to
surrender
– Ability to associate various arguments and
think logically
– Critical Thinking Ability
Creativity
Behavioral Aspects
– Ability to think differently
– A keen sense of colors
– Ability to present differently
– Courage to accept and present the ideas
Relating six sigma to HR Strategy
In all HR practices such strategic intent should be evident. In recruitment and
selection, focus should be to select those who have multiple skill sets and who can
be utilized interchangeably by cross lateral movement. This requires foreseeing the
future skill sets with the changing technology or process. Similarly regular
competency mapping and a synergy between individual and organisational
competencies need to be achieved through training till they all fit for the purpose.
Job Mobility
Job Enrichment
Job Enlargement
Career Planning- Development &
Succession Planning
Quality Control
Improving Performance
ATTRITION
During an analyst call of a major IT services
company, a question was raised about its
attrition rate. The query was directed at the
differing number which was arrived at by the
company and the analyst, though both were
right in their own way of calculating the
figure.
main methods of calculating attrition-one
which is based on the last 12 month while the
other being the quarter figure arrived at on an
annualized basis. Nitin Sethi, industry leader,
IT & ITeS, Hewitt Associates, says:
“Calculation of attrition rates in the Indian
industry has been no consistent approach or
method to calculate attrition rats and the
approach may vary from organization to
organization.”
The formula for quarter on an annualized basis’
attrition is computed on the premise of the numerator
divided by the denominator and it gets extrapolated
for the full year. This calculation is prone to being
impacted by the seasonality is prone to being
impacted by the seasonality in attrition, typically
which is high in June and September quarters while
the December and March quarters are relatively low.
In the formula of last twelve months, attrition is
computed on the basis of the trailing 12 months that
negates any seasonality in attrition.
Further, the calculation and declaration of
attrition is also an ‘unaudited’ figure as there
are various other elements which may or may
not be people under different categories like
trainees, probationers, or even the under
performers.
Tarun Singh, director, Kenexa Technologies, India,
says: “Most organization in practice do not evolve
robust measurements for calculating cost of a bad hire
or labour turnover. The detailed information required
and the measurement metrics are not common one-
size-fits –all formulae, but have to be designed based
on the nature of business and function of the
organization. Thus different models and statistics
may be statistics may be specific to and hold true for
different organization.”
Providing and examples, Achal Khanna,
country general manager, Kelly Services India,
says if a company has 1,00 employees in April
2004 and 2,00 in March 2005, then they may
take their base as 2,000 in March 2005, then
they may take their base as 2,000 in or as
1,500 (average for the year) and if the number
of employees who left is 300 then the attrition
figure could be 15% or 20% depending on
what base you take.
Thecase of differing attrition rate could be
perhaps linked to the growth being
experienced by the IT industry and the
pressure points in terms of supply of
manpower. In this people driven business, it is
imperative to have the attrition under control.
According to Bhaskar Das, vice-president- HR,
Cognizant, it reports attrition for the quarter on an
annualized basis as that’s the globally accepted
practice by many companies. Das says “I think
investors and analysts do find it difficult to gauge
what the real attrition number is, different formulae
are used by different companies.” It is also important
for the companies to project the ‘right number’ to
their stakeholders and its employees as any high
degree of attrition could set the ball rolling in the
wrong direction.
Sethi says, “Since attrition rates are a very
important factor in determining the health of a
company, they would want to adopt different
methods of calculating attrition which will suit
them(produce lower attrition numbers). “Ms
Khanna says, “Attrition number is also a PR or
stock/analyst statement and is prone to
dressing’ up”.
The level of attrition also directly impacts the
business of any organization. It not just the
various costs which are associated with the
people leaving the organization, but hindering
its future growth plans. A lower rate of
attrition bodes well for any organization.
Attrition also directly relates to the employee
engagement in the company as well as the confidence
of the customer in the ability of the company to
deliver the services. Singh says high attrition rate
affects employee morale, inhibits new people from
joining and shakes the clients faith in it and even
perhaps impacts stock performance. “In some case it
can be simply seen as an organisation’s competitor
appreciating its quality of hires and the output, post-
training- almost a backhanded compliment, “ says Ms
Khanna.
Bhaskar says, “ In the information technology
industry people are the core assets. It there is
frequent change there would be discontinuity
in providing the same level of experience to
customers,” he adds. He says attrition data is
also used to find out whether any employee
engagement process needs to be tweaked to
build stronger businesses.
Given this background on the differing view-
points on attrition, is there a need for own
common standard of defining attrition or a set
of methodologies, which could actually define
how it needs to be calculated.
“Absolutely,” says Sethi, “We need a common
standard for the industry. It is very difficult to arrive
at industry and company benchmarks if the method of
calculating is different from company to company.”
Singh feels it would probably be difficult to arrive at
a common standard for calculating attrition for
various reasons which may range from organizations
experiencing high attrition rates and also employee
turnover which needs to be split up into component
parts like employees who leave within a year of
joining or those who are asked to leave due to low
productivity.
TV Mohandas Pai, director, HR & Training
Infosys says, reporting attrition is a new
phenomenon for any industry especially for IT
sector and it is still a evolving process.
He says it is upto to the individual companies
to choose the methods it would like of
calculating attrition and feels that a common
standard would evolve over a period of time.
Costs involved in Attrition
• Administration cost
• Sourcing cost
i) Agency cost
ii) Advertising cost
• Recruitment cost
• Training & Development cost
• Replacing an employee (Compensating for knowledge
loss- learning curve).
3. Better prospects
4. Further education
5. Health
6. Marriage
7. Migration
8. Others
9. Personal
10. Termination
Can you provide a figure for the cost of attrition which the
Indian BPOs are paying?