Human resource

planning - I

Introduction
Human resource planning
is a process by which an
organization ensures that
it has the right number and
kinds of people
at the right place
at the right time
capable of effectively and
efficiently completing those
tasks that will help the
organization achieve its
overall strategic objectives.

Introduction
Linked to the organizations
overall strategy and planning to
compete domestically and
globally.
Overall plans and objectives must
be translated into the number and
types of workers needed.
Senior HRM staff need to lead top
management in planning for HRM
issues.

Characteristics of HRP
Integral part of corporate planning
Facilitates control of manpower cost
Facilitates effective manpower management
Brings equilibrium between demand and supply
of manpower
Promotes manpower development

Objectives of HRP

Provision of adequate manpower

Optimum utilization of Human Resource
Meeting future manpower needs
Development of manpower
Prevent Disruption of Work
Control Costs
Assess surplus/shortages of manpower
Foresee the impact of technology on total
workload, existing employees and human
resources required in the near future

Need for HRP

Smooth and efficient working of Organizations

Filling Gaps in Manpower
Expansion and Diversification
Changing Technology
Increased Employee Mobility
Coping with change
Budgeting
Shortage of Skills

Advantages of HRP

Facilitates scientific Recruitment and selection

Raises effectiveness of HRD programmes
Ensures orderly and efficient working and growth
Regulates cost factor
Motivates existing employees
Prevents sudden disruption
Provides quality workforce

Limitations

Problem of Accuracy
Surplus makes HRP redundant
Emphasis on Quantitative Aspects
Uncertain Future
Management Attitude
Faulty Information System
Expensive
Time Consuming and costly
Shortage of skilled labour and high labour
turnover

Steps in HRP

Factors affecting HRP

Improper linkage between HRP and Corporate
strategy
Rigidity in attitudes
Conflict between long term and short term HRP
Lack of Skilled Resources
Separation of Employees
Change in Organizational Objectives
Change in Policies

Human resource planning

- II

HRIS
Human Resource Information System (HRIS) is a
systematic way of storing data and information foreach
individual employee to aid planning, decision making,
and submitting of returns and reports to the external
agencies.
It merges HRM as a discipline and in particular itsbasic
HR activities and processes with the information
technology field.
It can be used to maintain details such as
employeeprofiles, absence reports, salary admin. and
various kinds of reports.

Steps of implementing an
HRIS

Uses of HRIS

Advantages of
computerized HRIS
Develops ability to process data with accuracy
and high speed
Huge data on different aspects of HRM are
arranged and stored systematically
Information users get quick access to required
information
Economical
Greater accuracy
Quick communication with employee

Voluntary Retirement Scheme

A voluntary retirement scheme (VRS) package is
offered to employees as an incentive to retire earlier
than their normal retirement age. The VRS package
usually contains generous retirement benefits for
certain employees.
Benefits may be in the form of:
Pension or lump sum gratuity
Loyalty bonus
Employee Stock option plans, etc

Issues in VRS
Identifying the need for VRS
Cost benefit analysis
Designing the scheme
Convincing trade unions
Rehabilitating employees

Merits and Demerits of VRS

Merits

Retrenching excess
workforce
No legal obstacle
Attractive financial
compensation
Flexibility
Reduction of wage bill

Demerits

Creates sense of fear

and insecurity among
employees
Severance cost
Opposition from trade
unions
Spoil reputation

Downsizing
A downsizing strategy reduces the scale (size) and scope
of a business to improve its financial performance
A reduction of the workforce is one of only several
possible ways of improving profitability or reducing costs.
Objective of downsizing is to achieve rightsizing.
Where there is surplus of workforce, downsizing is
required
Alternative methods to reduce employees:
Reduce work hours so total salary get reduced with same
number of people
Transfer
Offer incentives for early retirement or VRS
Declare lay-off

Outsourcing
Outsourcing is a strategic decision to give a task
or activity to an independent contractor who
determines how best to do the task or activity.
The firm and the independent contractor become
partners and may establish a long-term
relationship.
Examples of outsourced activities: IT, HR, Legal
services, Manufacturing, R & D.

Demotion
Demotion is the antithesis of promotion.
It is lowering of status, salary and responsibilities
of an employee.
It is are given as a disciplinary measure or on
grounds of incompetency of an employee or due
to adverse business conditions.
Demotion policy should be open, fair and
impartial.

Separation
It is a step ahead of demotion.
It involves cessation of services of a personnel form an
organization.
The employment relationship between and organization
and an employee come to an end.
Forms of retirement:

Resignation
Dismissal
Death
Suspension
Layoff
Retrenchment
Retirement

Lay-off
Layoff is a temporary separation of an employee
by the employer under specific circumstances.
Here, the services of an employee are not
terminated.
It is temporary separation.
Layoff reduces financial burden on the
organization.

Retrenchment
Retrenchment is a sort of permanent separation by an
employer with due notice as per statutory provisions.
The principle applied under retrenchment is, last
come first go.
It is applied mainly when work force is Superfluous,
not in cases of punishment, retirement, etc.
The industrial Disputes Act, 1947 has laid down
conditions for retrenchment.

Termination
It is permanent separation of an employee from
the organization.
The action take should be bona fide and not be a
punitive measure nor a case of victimization.
Dismissal is termination of service by way of
punishment.

Pink Slip
It is an American term that refers to being fired
or laid off from ones job.
It is an official notice sent to the employee for
dismissal
It is a notice printed on pink paper (distributed
with paychecks)

Contracting and SubContracting

Contracting is an agreement whereby the
contractor undertakes to complete a piece of
work or perform a service for the commissioning
party, organizing his or her own resources and
managing the work at his or her own risk, in
return for a financial payment.
A subcontractor is an individual or in many cases
a business that signs a contract to perform part
or all of the obligations of another's contract.

Promotions

Promotion involves a change from one job to another that is better

in terms of status and responsibilities- Edwin flippo
Features of promotion:

Put the employee in a position where he will be of greater value

Develop competitive spirit and zeal
Develop internal source of employees
Promote employee self development
Build up morale, loyalty and sense of belongingness
Promote employees interest in T&D
Reward committed and deserving employees
Create a feeling of contentment among employees

Types of Promotions:
Horizontal
Vertical
Dry

Bases of Promotion
Promotion based on Seniority
Advantages:

Simplicity
Objectivity
Reward
Reduces employee turnover
Union approval
In line with Indian culture

Criticism:

Faulty assumption
Ignores performance
Efficiency suffers
Demotivating

Continued
Promotion based on Merit
Advantages:
Enhances efficiency
Motivates

Limitations:

Subjective
Favoritism
Opposition of unions
Insecurity

Continued
Promotion based on Seniority-CumMerit
Ways to strike a balance:
Minimum length of service and merit
Measurements of seniority and merit
through a common factor
Minimum merit and seniority

Promotion Policies
Statement of the organisations broad directives on promotion matters
Main characteristics:

Policy statement
Basis of promotion
Promotion charts
Communication of policy
Career planning
Detailed records
Employee training
Consistency
Fair and impartial
Decision making authority
Appeal mechanism

Benefits of Promotion
To Employees

Higher salary
Higher status
Change in nature of
work
Non-monetary benefits
Incentive to work
efficiently
Psychological
satisfaction

To Management

Raises the morale of

employees
Develops second line of
leadership
Reduces the rate of labor
turnover and absenteeism
Raises job satisfaction
Attracts capable,
talented, efficient and
loyal workers

Transfers

Transfer refers to shifting of employees from one job to

another within the same organization where salary,
responsibilities and category of the new job and previous
job are almost the same.

Objectives of Transfer
Organizational needs
Employee needs
Optimal utilization of employees
Increase employee versatility
Relief
Disciplinary action

Transfer Policy

The policy on Employee transfer needs to address the following:

Right of the organization to transfer

Terms and conditions
Transfer procedures
Transfer back to former job
Effects of remuneration and seniority

Conditions of a good policy

Should state the types of transfers

Person who has authority to order transfer
Effect of transfer on pay and seniority
Facilities available to transferred employees
Conditions under which personal request for transfer will be entertained
Writing
Appropriate authority in case of appeals
Best interests

Types of Transfer

Employee transfer is classified based on purpose as under:

Transfers that are effected for T&D
Transfers made for adjustment of varying volumes
Transfers designed to correct the problem of poor employee placement

Common types of Transfer:

Production
Replacement
Versatility
Shift
Remedial
Penal
Precautionary
Sectional
Departmental

Case Study