Human Resource Management, Unit 2- SY BBA (Sem 3), VNSGU-Surat
UNIT 2
HUMAN RESOURCE PLANNING
TOPICS TO STUDY
1. Meaning and Definitions of Human Resource Planning (HRP)
2. Benefits / Importance / Significance of HRP
3. HRP Process
4. Forecasting HR demand and supply
5. Skill Inventories
6. Concept of HRIS
7. Succession Planning
8. Job Analysis
9. Job Description
10. Job Specification
HUMAN RESOURCE PLANNING – Meaning & Definitions
Human resource planning is the process in which organizations determine the staff
(employees) required to meet business needs.
Planning of human resources is the main responsibility of HR managers. Human resources
are important because they provide competitive advantage to organisations. In the age of
competition, firms are now focusing their attention on employee knowledge and skills.
Because of the importance of Human resources, separate HRP departments have been set
up in most of the important business organizations.
Definition of Human Resource Planning:
Robbins defines HRP as “the process by which an organization ensures that it has the right
number and kinds of people at the right places, at the right time, capable of effectively and
efficiently completing those tasks that will help the organization achieve its overall
objectives”.
1
Page
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
, Human Resource Management, Unit 2- SY BBA (Sem 3), VNSGU-Surat
IMPORTANCE / BENEFITS / SIGNIFICANCE OF HRP
The following points highlight the need and importance of HRP in the organizations:
I. Assessing Future Personnel Needs:
If there is no planning in organisations then there is always a problem of surplus labour or
shortage of labour. A number of organizations like Public Sector Units (PSUs) in India are
facing the problem of surplus labour.
Because of surplus labour, Companies later on offer schemes like Voluntary Retirement
Scheme (VRS) to remove surplus staff.
Thus, it is better to plan human resources in advance. Through HRP, one can ensure the
employment of proper number and type of personnel.
II. Foundation for Other HRM Functions:
HRP is the first step in all HRM functions. So, HRP provides the important information
needed for the other HRM functions like recruitment, selection, training and development,
promotion, etc.
III. Coping with Change:
Changes in the business environment like competition, technology, government guidelines,
global market, etc. bring changes in the nature of the job. This means changes in the
demand of personnel, content of job, qualification and experience needed. HRP helps the
organization in adjusting to new changes.
IV. Investment Perspective:
As a result of change in the mind-set of management, investment in human resources is
better in the long run success of the enterprise. Human assets can increase in value as
compared to other physical assets. Thus, HRP is considered important for the proper
planning of future employees.
V. Expansion and Diversification Plans:
During the expansion and diversification of businesses, more employees at various levels
are needed. Through proper HRP, an organization comes to know about the exact
requirement of human resource in future plans.
VI. Employee Turnover:
Every organization suffers from the small turnover of labour. This is high among young
graduates in the private sector. Because of this, proper manpower planning is needed for
recruiting and hiring of new employees.
VII. Conformity with Government Guidelines:
In order to protect the weaker sections of the society, the Indian Government has decided
some norms for organizations to follow. For example, reservations for SC/ST, BC, physically
handicapped, ex-servicemen, etc. in the jobs. While planning for fresh candidates, HR
manager takes into consideration all the Governmental guidelines.
VIII. International Expansion Strategies:
2
International expansion strategies of an organization depend upon HRP. Under
Page
International Human Resource Management (IHRM), HRP becomes more challenging.
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
, Human Resource Management, Unit 2- SY BBA (Sem 3), VNSGU-Surat
An organization may want to fill the foreign subsidiary’s key positions from its home
country employees or from host-country or from a third country. All this requires very
effective HRP.
IX. Having Highly Talented Manpower Inventory:
Due to changing business environment, jobs have become more challenging and there is an
increasing need for dynamic and ambitious employees to fill the positions. Efficient HRP is
needed for attracting and retaining well qualified, highly skilled and talented employees.
PROCESS / STEPS IN HUMAN RESOURCE PLANNING
The HRP process is the heart of human resource practices, as it includes activities such as
analysing the human resource needs of the organization and formulating human resource
plans.
The HRP process consists of the following steps;
Organizational environment scanning
Formulation of organizational objectives and policies
Demand forecasting
Supply forecasting
HR programming
HRP implementation
HRP controlling and evaluation
STEP # 1. Organizational Environment Scanning:
Organizational environment scanning involves looking at the external factors that affect an
organization.
Human resource managers can predict the influence of these factors on HRP by assessing
and inspecting the changing environment. HR managers will then make appropriate
adjustments and modifications to the human resource of the organization on time.
The process of environmental scanning checks various external factors as follows:
i. Economic Factors – Include the general, local, and regional economic conditions
3
determined by the economic structure adopted (capitalistic, mixed or socialistic
Page
economy) and economic policies implemented, such as monetary and fiscal policies,
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
UNIT 2
HUMAN RESOURCE PLANNING
TOPICS TO STUDY
1. Meaning and Definitions of Human Resource Planning (HRP)
2. Benefits / Importance / Significance of HRP
3. HRP Process
4. Forecasting HR demand and supply
5. Skill Inventories
6. Concept of HRIS
7. Succession Planning
8. Job Analysis
9. Job Description
10. Job Specification
HUMAN RESOURCE PLANNING – Meaning & Definitions
Human resource planning is the process in which organizations determine the staff
(employees) required to meet business needs.
Planning of human resources is the main responsibility of HR managers. Human resources
are important because they provide competitive advantage to organisations. In the age of
competition, firms are now focusing their attention on employee knowledge and skills.
Because of the importance of Human resources, separate HRP departments have been set
up in most of the important business organizations.
Definition of Human Resource Planning:
Robbins defines HRP as “the process by which an organization ensures that it has the right
number and kinds of people at the right places, at the right time, capable of effectively and
efficiently completing those tasks that will help the organization achieve its overall
objectives”.
1
Page
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
, Human Resource Management, Unit 2- SY BBA (Sem 3), VNSGU-Surat
IMPORTANCE / BENEFITS / SIGNIFICANCE OF HRP
The following points highlight the need and importance of HRP in the organizations:
I. Assessing Future Personnel Needs:
If there is no planning in organisations then there is always a problem of surplus labour or
shortage of labour. A number of organizations like Public Sector Units (PSUs) in India are
facing the problem of surplus labour.
Because of surplus labour, Companies later on offer schemes like Voluntary Retirement
Scheme (VRS) to remove surplus staff.
Thus, it is better to plan human resources in advance. Through HRP, one can ensure the
employment of proper number and type of personnel.
II. Foundation for Other HRM Functions:
HRP is the first step in all HRM functions. So, HRP provides the important information
needed for the other HRM functions like recruitment, selection, training and development,
promotion, etc.
III. Coping with Change:
Changes in the business environment like competition, technology, government guidelines,
global market, etc. bring changes in the nature of the job. This means changes in the
demand of personnel, content of job, qualification and experience needed. HRP helps the
organization in adjusting to new changes.
IV. Investment Perspective:
As a result of change in the mind-set of management, investment in human resources is
better in the long run success of the enterprise. Human assets can increase in value as
compared to other physical assets. Thus, HRP is considered important for the proper
planning of future employees.
V. Expansion and Diversification Plans:
During the expansion and diversification of businesses, more employees at various levels
are needed. Through proper HRP, an organization comes to know about the exact
requirement of human resource in future plans.
VI. Employee Turnover:
Every organization suffers from the small turnover of labour. This is high among young
graduates in the private sector. Because of this, proper manpower planning is needed for
recruiting and hiring of new employees.
VII. Conformity with Government Guidelines:
In order to protect the weaker sections of the society, the Indian Government has decided
some norms for organizations to follow. For example, reservations for SC/ST, BC, physically
handicapped, ex-servicemen, etc. in the jobs. While planning for fresh candidates, HR
manager takes into consideration all the Governmental guidelines.
VIII. International Expansion Strategies:
2
International expansion strategies of an organization depend upon HRP. Under
Page
International Human Resource Management (IHRM), HRP becomes more challenging.
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
, Human Resource Management, Unit 2- SY BBA (Sem 3), VNSGU-Surat
An organization may want to fill the foreign subsidiary’s key positions from its home
country employees or from host-country or from a third country. All this requires very
effective HRP.
IX. Having Highly Talented Manpower Inventory:
Due to changing business environment, jobs have become more challenging and there is an
increasing need for dynamic and ambitious employees to fill the positions. Efficient HRP is
needed for attracting and retaining well qualified, highly skilled and talented employees.
PROCESS / STEPS IN HUMAN RESOURCE PLANNING
The HRP process is the heart of human resource practices, as it includes activities such as
analysing the human resource needs of the organization and formulating human resource
plans.
The HRP process consists of the following steps;
Organizational environment scanning
Formulation of organizational objectives and policies
Demand forecasting
Supply forecasting
HR programming
HRP implementation
HRP controlling and evaluation
STEP # 1. Organizational Environment Scanning:
Organizational environment scanning involves looking at the external factors that affect an
organization.
Human resource managers can predict the influence of these factors on HRP by assessing
and inspecting the changing environment. HR managers will then make appropriate
adjustments and modifications to the human resource of the organization on time.
The process of environmental scanning checks various external factors as follows:
i. Economic Factors – Include the general, local, and regional economic conditions
3
determined by the economic structure adopted (capitalistic, mixed or socialistic
Page
economy) and economic policies implemented, such as monetary and fiscal policies,
Dr. Zakir A. Patel, Prof, Naran Lala College of Commerce and Management, Navsari
Mobile; 9586075954
