Human resource planning
• Human resource planning involves getting the
right number of qualified people into the right
jobs at the right time.
• Capable of effectively and efficiently
completing those tasks that help the
organization achieve its overall objectives.
• Setting human resource objectives and
deciding how to met them
The process of human resource
• Organizations should carry out human
resource planning so as to meet business
objectives and gain a competitive advantage
-Human resource planning compares the present state of
the organization with its goals for the future
-Then identifies what changes it must make in its human
resources to meet those goals
Overview of human resource planning
Forecasts of labor surplus
Goal setting and strategic
Labor and demand
Demand and Supply forecasting
• Demand forecasting - which entails estimating the
organization's future staffing requirement in terms of
numbers and skills, by reference to its aims and
objectives and taking account of changes in working
practices and activities levels?
• Supply forecasting - which entails estimating the
likely future labor supply, both from within the
organization taking account of employee wastage,
current skills mix, performance, etc and from outside
the organization taking account of the potential pool
of staff with the right levels of knowledge and skill.
Forecasting Availability of Human
• EXTERNAL SUPPLY -The external supply of potential
employees available to the organization needs to be
estimated. Extensive use of government labor force
population estimates, trends in the industry, and
many more complex and interrelated factors must be
• INTERNAL SUPPLY -estimating internal supply
considers that employees move from their current
jobs into others through promotions, lateral moves,
Determining Labor Surplus or Shortage
• Based on the forecasts for labor demand and
supply, the planner can compare the figures to
determine whether there will be a shortage or
surplus of labor for each category.
• Determining expected shortages and
surpluses allows the organization to plan how
to address these challenges.
Goal Setting and Strategic Planning
• The purpose of setting specific numerical goals is to focus
attention on the problem and provides basis for
measuring the organization’s success in addressing labor
shortages and surpluses.
• The goals should come directly from the analysis of
supply and demand.
• For each goal, the organization must choose one or more
human resource strategies.
• Organizations should retain and attract employees who
provide a core competency (what makes it better than
Forecasting as a Part of Human Resource Planning
forecast for each
Go to feasibility analysis steps
Internal supply forecast External supply forecast
Implementing and Evaluating
the HR Plan
• When implementing the HR strategy, the
organization must hold some individual
accountable for achieving the goals.
• Regular progress reports should be issued.
• The evaluation of results should not only look
at the numbers, but should also identify which
parts of the planning process contributed to
success or failure.
Example of the Basic Human Resource
for new installation
because of lack
with right skills
Too costly to hire
1 2 3
Recruiting Human Resources
• The role of human resource recruitment is to
build a supply of potential new hires that the
organization can draw on if the need arises.
• Recruiting – any activity carried on by the
organization with the primary purpose of
identifying and attracting potential
Three aspects of recruiting
personnel policies are its
decisions about how it will
carry out human resource
how it will fill job
Several personnel policies
are specially relevant to
Personnel policies Internal versus external recruiting
Lead the market pay
Employment at will policies
Recruitment Sources: Internal Sources
• Job posting: the process of communicating
information about a job vacancy:
-On company bulletin boards
-In employee publications
-On corporate intranets
-Anywhere else the organization
communicates with employee
Advantage of Internal Sources
1. It generates applicants who are well known
to the organization.
2. These applicants are relatively
knowledgeable about the organization’s
vacancies, which minimizes the possibility of
unrealistic job expectations.
3. Filling vacancies through internal recruiting is
generally cheaper and faster than looking
outside the organization.
One in Three Positions are
Filled with Insiders
In a survey of large, well-known businesses, respondents said about one-
third of positions are filled with people who already work for the company
and accept a promotion or transfer.
Recruitment Sources: External Sources
External Recruiting Sources
Percentage of Employees Hired
According to the survey results shows the largest share (about one-fourth) of new
employees hired by large companies came from referrals, and the next largest share
(almost 21 percent) came from direct applications made at the employer’s Web site.
Selection has been regarded as the most important
function of HR department. It ensures the organization that; it has right
number, right kind of people at the right place and at the right time.
Meaning and Definitions:
“It is the process of differentiating between applicants in
order to identify (and hire) those with the greater likelihood of success.”
1. Preliminary Interview
2. Selection Tests
3. Employment Interview
4. Reference and Background
5. Selection Decision:
6. Physical Examinations
7. Job Offer
8. Contract Of Employment
9. Evaluation of Selection
1. Preliminary Interview:
The purpose of this interview is to
scrutinize the applicants, i.e. elimination of
2. Selection Tests:
Different types of selection tests may be
administrated, depending on the job and the
company. Generally tests are used to determine
the applicant’s ability, aptitude, and personality.
3. Employment Interview:
The next step in the selection process is
employment interview, an interview is conducted
at the beginning, and at the selection process of
the employment interview can be one- to-one
interview or panel interview.
4. Reference and Background Checks:
Many employers request names,
address, telephone numbers or references for the
purpose to verify information and gaining
additional background information of an
5. Selection Decision:
Selection decision is the most critical of
all steps in selection process. The final decision
has to be made from the pool of individuals who
pass the tests, interviews and references checks.
6. Physical Examinations:
After selection decision and before the
job offer is made, the candidate is required to
undergo a physical fitness test. A job offer is
often; contingent upon the candidate being
declared fit after the physical examinations.
7. Job Offer:
The next step in selection process is job offer. Job offer is made
through a letter of appointment. Such a letter generally contains a date by which
the appointee must report on duty
8. Contract Of Employment:
Basic information is written in Contract of employment that varies
according to the levels of job. After the offer and acceptance of the job certain
document is the attestation form.
9 Evaluation of Selection program:
The broad test of effectiveness of the selection process is a systematic
evaluation .a periodic audit is conducted in the HR department that outlines and
highlights the areas which need to be evaluated in the selection process
• The first step in human resource planning is
personnel forecasting. Through trend analysis and
good judgment, the planner tries to determine the
supply and demand for various human resources.
• The next step is to determine the labor demand for
workers in various job categories. Analysis of a
transitional matrix can help the planner identify
which job categories can be filled internally and
where high turnover is likely.
• To reduce a surplus, downsizing, pay reductions, and
demotions deliver fast results but at a high cost in
human suffering that may hurt surviving employees’
motivation and future recruiting.
• To avoid a labor shortage, requiring overtime is the
easiest and fastest strategy.
• Internal recruiting generally makes job vacancies
more attractive because candidates see
opportunities for growth and advancement.
• Lead-the-market pay strategies make jobs
• Internal sources are usually not sufficient for all of an
organization’s labor needs.
• Through their behavior and other characteristics,
recruiters influence the nature of the job vacancy
and the kinds of applicants generated.
Test Your Knowledge
• A public accounting firm of 250 employees
realizes they have a surplus of 15 support
personnel (not auditors). What should they
a) Hire temporary workers
b) Offer early retirement
c) Downsize people in those positions
d) Wait for attrition and implement a hiring
freeze for those positions