Human Resource Planning & Support Systems in Recruitment

Session 3 & 4 28th November 2010

Facilitator: Devashis Rath

Session Objectives
Understand why HRP is central to employee resourcing Appreciate factors that impact upon a HR Plan Make a connection between organizations strategy and HRP Learn the HRP process and the two approaches associated with it

Understand how internal manpower position is assessed and what techniques are used for the same
Learn how external manpower position is assessed

Have a overview of various techniques for forecasting manpower

Appreciate how to manage HR surplus and HR shortage
2 Facilitator: Devashis Rath

What is HRP?
The process of analyzing and identifying the need for

and availability of human resources so that the

organization can meet its objectives. A process which anticipates and maps out the consequences of business strategy on an organization's human resources. This is reflected in planning of skill

and competence needs as well as total headcounts.

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Purpose of HRP
Effective HR Planning

Right people

Right capabilities

Right time

Right place

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Factors that Determine HR Plan

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HRP & STRATEGIC FIT

Internal Fit (or Internal Alignment) focuses on aligning HR practices with one another to establish a configuration that is mutually reinforcing..

External Fit (or External Alignment) focuses on the connection between the business objectives and the major initiatives in HR.

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HR Planning Process

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Diagnostic Approach
WHERE ARE WE NOW? Assessing external and organizational conditions and employee characteristics WHERE DO WE WANT TO BE ? Set human resources objectives, based on efficiency and equity, according to dimensions that matter to key stakeholders HOW DO WE GET FROM HERE TO THERE? Choose human resources activities and expend resources necessary

HOW DID WE DO? WHERE ARE WE NOW? Evaluate result by assessing new condition according to the objectives, and start the process again
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Strategic Planning Approach

Strategic Planning
Human Resource Planning
Forecasting Human Resource Requirements Comparing Requirements and Availability Forecasting Human Resource Availability

Demand = Supply No Action

Surplus of Workers

Shortage of Workers

Restricted Hiring, Reduced Hours, Early Retirement, Layoff, Downsizing

Recruitment

Selection 9 Facilitator: Devashis Rath

Types of Planning
Aggregate planning
Anticipating the needs for groups of employees in specific, usually lower level jobs and the general skills employees will need to ensure sustained high performance

Succession Planning
Focuses on ensuring that key individual management position in the organization remain filled with individuals who provide the best fit for these critical positions

10 Facilitator: Devashis Rath

Assessing Internal Manpower Position

Jobs and Skills Audit
What jobs exist now?
How many individuals are performing each job? What are the reporting relationships of jobs? How essential is each job? What jobs will be needed to implement future organizational strategies? What are the characteristics of anticipated jobs?

11 Facilitator: Devashis Rath

Assessing Internal Manpower Position

Organizational Capabilities Inventory
HRIS databasessources of information about employees knowledge, skills, and abilities (KSAs) Components inventory of an organizational capabilities

Individual employee demographics Individual career progression Individual job performance data

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Factors Affecting Internal Supply

Effects of promotions, lateral moves, and terminations Succession analysis
Replacement charts Transition matrix (Markov matrix)

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Techniques to Determine Internal Manpower Status

Succession or Replacement Charts
Who has been groomed/developed and is ready for promotion right NOW?

Human Resource Information Systems (HRIS)

An employee database that can be searched when vacancies occur.

Transition Matrices (Markov Analysis)

A chart that lists job categories held in one period and shows the proportion of employees in each of those job categories in a future period. It answers two questions:
1. Where did people in each job category go? 2. Where did people now in each job category come from?

Personnel / Yield Ratios

How much work will it take to recruit one new accountant?

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Employee Replacement Chart for Succession Planning

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Vacancy Analysis
LEVEL# EMPL TURN % Expected Vacancies
TOP MGMT 100 20 % 20

Expected to Remain
80

MID MGMT
LOW MGMT SKILLED W ASSY W TOTALS

200
600 600 2000 3500

24 %
22 % 16% 12 %

48
132 96 240 536

152
468 504 1760 2964

AVERAGE TURNOVER PERCENTAGE = 536 / 3500 = .1531

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Estimating Internal Labour Supply

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HRP & Environmental Scanning

Environmental Scanning: The systematic monitoring of the major external forces influencing the organization
Economic factors Competitive trends Technological changes Political and legislative issue Social concerns Demographic trends

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Factors Affecting External Supply

Net migration for an area

Individuals entering and leaving the workforce

Individuals graduating from schools and colleges Changing workforce composition and patterns

Economic forecasts
Technological developments and shifts Actions of competing employers Government regulations and pressures Other factors affecting the workforce
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Forecasting Techniques
Forecasting
The use of information from the past and present to identify expected future conditions

Forecasting Methods
Judgmental
Estimatesasking managers opinions, top-down or bottom-up Rules of thumbusing general guidelines

Delphi techniqueasking a group of experts

Nominal groupsreaching a group consensus in open discussion

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Forecasting Techniques
Forecasting Methods
Mathematical
Statistical regression analysis Simulation models Productivity ratiosunits produced per employee Staffing ratiosestimates of indirect labor needs

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SIMULATION MODEL/REGRESSION FORECAST

TARGET STORES STAFFING FORECAST

MODEL
Y = 8 + .0011(X1) + .00004(X2) + .02(X3)
Y = Number of employees needed to staff the store X1 = Square feet of sales space X2 = Population of metropolitan area X3 = Projected annual disposable income in millions of dollars Y = 8 + .0011(50,000sq ft) + .00004(150,000popul) + .00000002($850 million) Y = 8 + 55 + 6 + 17 Y = 86 employees needed at this store
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Managing HR Surplus
Workforce Reductions and the WARN Act

Workforce Downsizing

Attrition and Hiring Freezes Voluntary Separation Programs

Human Resource Surplus

Layoffs

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Managing HR Surplus
Outplacement services are provided to displaced employees to give them support and assistance:
Personal career counseling Resume preparation and typing services

Interviewing workshops
Referral assistance Severance payments

Continuance of medical benefits

Job retraining
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Managing HR Shortage
Use overtime

Add contingent workers

Bring back recent retirees

Human Resource Shortage

Outsource work

Reduce turnover

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HRP During Mergers & Acquisitions

Cultural Compatibility
The extent to which such factors as decision-making styles, levels of teamwork, information-sharing philosophies, and the formality of the two organizations are similar

HRs Role in Mergers and Acquisitions

Communicating decisions

Revising the organization structure

Merging HR activities
26 Facilitator: Devashis Rath

Key Factors in Cultural Fit

Degree of internal integration

Autonomy

Adaptability

Cultural Fit in Mergers and Acquisitions

Employee trust

Diversity

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How popular are HRP techniques?

Replacement charts 84%

Skills inventories
Computer simulation Time series analysis Markov analysis Delphi technique

51%
10% 5% 4% 3.5%

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Summary
Understand why HRP is central to employee resourcing employee resourcing
Right people
Right capabilities Right time

Right place

Appreciate factors that impact upon a HR Plan

Strategy Culture Competitive environment Current organizational situation
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Summary
Make a connection strategy and HRP between organizations

External alignment is about connection between the business objectives and the major initiatives in HR Internal alignment aligning HR practices with one another

Learn the HRP process and the two approaches associated with it
Diagnostic approach
Strategic planning approach
30 Facilitator: Devashis Rath

Summary
Understand how internal manpower position is assessed and
Aggregate planning Succession planning

What techniques are used for the same

Succession or Replacement Charts Human Resource Information Systems (HRIS)

Transition Matrices (Markov Analysis)

Personnel / Yield Ratios

31 Facilitator: Devashis Rath

Summary
Learn how external manpower position is assessed
Environmental scanning Net migration for an area Changing workforce composition, etc.

Have a overview of forecasting manpower

Qualitative methods

various

techniques

for

Quantitative methods

Appreciate how to manage HR surplus and HR shortage

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Espoused Theory vs. Theory-in-use

Internal Consistency Espoused Theory Something one chooses and follows It is used to idealize post facto behaviour Does not leads to action ET: What one says one is doing TIU: What one actually does

CORE ISSUE IS Internal Sourcing vs. External Sourcing Internal Consistency Theoryin-use

Congruence

Effectiveness

Values

Action

Behavioural World
Created by human convention and continued by human choice 33

Decision assumptions
Facilitator: Devashis Rath

Testability
Feedback loop is dependent on prior assumptions Reinforcement of Behavioural World through validation of theories-in-use

Espoused Theory vs. Theory-in-use

Internal Consistency Espoused Theory Directly observable Means for analyzing fit or consistency between ET and TIU Helps to analyse the influence of action on behavioural world
Is the behavioural world created through TIU considered a positive or negative one? +ve = stability -ve = change

Stated Recruitment Policy

Congruence

Effectiveness

Values

Internal Consistency
Assumptions on which Recruitment Decision is based

Theoryin-use Difficult to observe. Trend / pattern analysis

Action

Behavioural World

Testability

Facilitator: Devashis Rath

ULTIMATE OUTCOME Reduce information 34 uncertainty about candidate

35 Facilitator: Devashis Rath