Human resource planning is a process through which the company anticipates future business needs related to HR and plans for them. Human Resources planning assess the manpower requirement for the foreseeable future period of time. It attempts to provide sufficient manpower required to perform organizational activities at any given time. HR planning is a continuous process which starts with identification of organizational objectives and their impact on HR needs. It moves through analysis of current manpower resources and ends at development of action plans.
Following are the major steps involved in human resource planning
- Determining Organization’s Objectives
Human resource plans must be based on organizational strategic plans. This in practice means that the objectives of the human resource plan must be derived from organizational objectives. Organizational objectives give the organization and its members’ direction and purpose. The objective setting process begins at the top of the organization with a statement of missions which defines the organizations current and future business. Departmental objectives are derived from the organizations short term performance objectives. The assessment also involves an environmental analysis, under which the external and internal (objectives, resources and structure) environments are analyzed to assess the currently available HR inventory level. After the analysis of external and internal forces of the organization, it will be easier for HR manager to find out the internal strengths as well as weakness of the organization in one hand and opportunities and threats on the other. This will reveal the inventory of the workers and skills already available within the organization as well as those that the organization may need.
- Determining the skills and expertise needed/ Demand Forecasting
HR forecasting is the process of estimating demand for and supply of HR in an organization. Demand forecasting is a process of determining future needs for HR in terms of quantity and quality. It is done to meet the future personnel requirements of the organization to achieve the desired level of output. After establishing organizational and departmental objectives, operating managers should determine the skills and expertise required to meet their respective objectives. A good starting point would be a review of current job descriptions. Once this has been done, managers are in a better position to determine the number and quality of skills and expertise necessary to meet their objectives.
- Supply Forecasting/ determining number of additional skills
Supply is another side of human resource assessment. It is concerned with the estimation of supply of manpower given the analysis of current resource and future availability of human resource in the organization. It estimates the future sources of HR that are likely to be available from within an outside the organization. Internal source includes promotion, transfer, job enlargement and enrichment, whereas external source includes recruitment of fresh candidates who are capable of performing well in the organization.
- Matching Demand And Supply
It is another step of human resource planning. It is concerned with bringing the forecast of future demand and supply of HR. The matching process refers to bring demand and supply in an equilibrium position so that shortages and over staffing position will be solved. In case of shortages an organization has to hire more required number of employees. Conversely, in the case of over staffing it has to reduce the level of existing employment. Hence, it is concluded that this matching process gives knowledge about requirements and sources of HR.
- Action Plan
It is the last phase of human resource planning which is concerned with surplus and shortages of human resource. Under it, the HR plan is executed through the designation of different HR activities. The major activities which are required to execute the HR plan are recruitment, selection, placement, training and development, etc.
If for example the net requirements indicate a need for additions, decisions must be made on whether to make permanent hires, temporary hires or to outsource the work.
If the decision is to make permanent or temporary hires, plans must be made to recruit, select, orientate and train the specific numbers and type of personnel needed. Finally, this step is followed by control and evaluation of performance of HR to check whether the HR planning matches the HR objectives and policies. This action plan should be updated according to change in time and conditions.