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2Lal Bahadur Shastri Institute of Management, Dwarka
Human Resource Planning - Todays session
Surplus and
Deficit of
Employees
Job Analysis &
Methods
Job Description
& Job
Specification
Human
ResourcePlanning:
Demand
forecasting &
Supply
Forecasting
Recruiting Yield Pyramid
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It is a systematic exploration of the activities within a job. It is the process of studying &collecting information related to the operations & responsibilities of a specific job.
Human Resource Management
Job facts are gathered, analyzed, and recorded, as the job exists.Job Analysis
Job Analysis is performed on three occasions:
When an organization is founded & a job analysis program is initiated for the first time.
It is formed when new jobs are created.
Jobs being significantly changed as a result of new technologies, methods, proceduresor systems.
Job Description & Job Specification are products of job analysis.
Job Analysis in a jobless world - flatter organization, work team, boundary less
organization
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Objectives of HRM
JobAnalysisHelps in
Job Analysis
Human Resource Planning
Staffing
Training & Development (role based competencies)
The goal is todefine the idealindividual for a jobfrom theperspective of thecompany, its
strategy, & theemployees withwhom the new hirewill work.
Performance Appraisal / Management
Compensation & Benefits
Job design and redesign
Employee safety
Job evaluation
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Human Resource Planning
Job Analysis Methods
Questionnaires*
Observation
Interviews
Diary method
Critical incidents
Panel of experts
* Position Analysis Questionnaire
Developed by researchers at Purdue University
It is a structured job analysis instrument to
measure job characteristics and relate them to
human characteristics.
It presents a more quantitative and finely tuneddescription of jobs.
It consists of 194 job elements that represent in acomprehensive manner the domain of human behaviorinvolved in work activities.
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Human Resource Planning
Position Analysis Questionnaire
The items fall into sixcategories:
Information inputwhere and how the worker gets the information he or she useson the job.Eg., use of written material
Mental processes - What reasoning, decision making, planning are involved in thejobEg., coding / decoding
Physical activities - What physical activities does the employee perform and whattools or devices does he/she use?Eg., assembling/disassemblingUse of keyboard devices
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Human Resource Planning
Position Analysis Questionnaire
The items fall into sixcategories:
Job context- In what physical and social context is the work performed?
Relationships with other people - What relationships with other people arerequired in performing the job?
Eg., instructingcontacts with people, customers
Other job characteristicswhat activities, conditions, or characteristics other thanthose described above are relevant to the job?Eg., specified work place
amount of job structure
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Put the worker at ease; establish rapport.
Make the purpose of the interview clear.
Help the worker to think and talk according to the logical sequence of theduties performed.
Ask the worker only one question at a time.
Phrase questions carefully so that the answers will be more than just yes or
no.
Avoid asking leading questions
Secure specified and complete information pertaining to the work performedand the workers traits
Consider the relationship of the present job to other jobs in the department.
Control the time and subject matter of the interview.
Be patient and considerate to the worker.
Summarize the information obtained before closing the interview.
Guidelines for Conducting Job Analysis Interviews
Interviews
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Human Resource Planning
Job Analysis
Who should conduct
Job incumbents themselves
Supervisors
External analysts
Process of Job Analysis
Organizational analysis
Selection of representative positions to be analyzed
Collection of job analysis data
Preparation of job description
Preparation of job specification
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Job Analysis
Contents
Job Description
Job Title
Job Location/Department
Job No./CodeWritten statement ofwhat the job holderis expected to do,how it is done,under whatconditions it is done
and why it is done.
Grade/Level
Job Summary
Duties to be performed
Reporting Relationship
Percentage of time to be devoted to each task if possible
Machines, Tools & Materials
Relation to other jobs
Nature of supervision
Working environment & possible hazards
Inputs can be takenfrom observation ofthe job beingperformed,discussion withsupervisor &
employees,questionnaires filledby the supervisors& employees
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Job Analysis
Contents
Job Specification
Age Limit
Education & Qualifications
Previous Experience
Job Specification is a
document which
states the minimum
acceptable human
qualities &
qualifications
necessary to performa job properly.
Physique & health
AppearanceMental Abilities
Special Abilities
Professional/Technical skills
Personality Traits
Job Specification
translates the job
descriptions into
human qualifications
& at times levels of
performance.
It Serves as guide in
hiring & is used in
job evaluation.
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Human Resource Planning
Both the Coca-Cola Company and PepsiComanage their employees in unique ways thatmatch their strategies. Coke hires liberal artsgraduates (and rarely MBAs) with no corporateexperience and trains them extensively.
Employees are committed to the companybecause they can count on lifetime employment,seniority-based salary increases, and promotionfrom within. In this family culture, decision makingis centralized.
The companys human resource management
practices produce career managers who havebeen thoroughly socialized into understanding the
company trademark, which is the most recognizedin the world, and its value.
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Human Resource Planning
Pepsi is not Coke. Pepsi succeeds by targeting market
niche where coke is not dominant and finding newmarkets through diversification.
The human resource management practices have toproduce employees who are innovative. Its peoplemanagement practices have to produce employees whoare innovative. Its people-management process consistsof hiring experienced employees, many with advanced
degrees, and fast tracking those employees whodemonstrate early successes.
In this individualistic culture, there is almost no jobsecurity and no guaranteed promotion from within. WhatPepsi achieves is a continuous flow of new ideas (fromexperienced and intelligent employees)
These two succinct examples illustrate the concept ofaligning HR practices, policies and philosophies withorganizational strategy.
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In the opinion of Coleman, HRP is the process of determining manpowerrequirements and the means for meeting those requirements in order to
carry out the integrated plan of the organization.
HRP is a forward looking function as human resource estimates are madewell in advance. It is, of course, subject to revision.
Aggressive domestic and global competition, have made strategic planningvirtually mandatory.
2 phases of HRP
a. Projection of future manpower requirementsb. Developing manpower plans for the implementation of projections.
Human Resource Planning
HRP
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Objectives of HRM
HRPHelps to
HRP
Forecast personnel requirements
Cope with changes such as changes in technology, marketing,
management
Use existing manpower productively
The basic purposeof HRP is to decidewhat positions theorganization willhave to fill and howto fill them.
Organizations useHRP to meet futurechallenges, cutcosts, and achievegreatereffectiveness
Promote employees in a systematic way
Prepare people for future thus creating a talent pool
The demographic changes like changing profile of the workforce in
terms of age, gender, education etc
Government policies w.r.t reservation, child labor.
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Human Resource Planning
Information / Records for HRP
How many employees does the company currentlyemploy?
What is the age profile by department?
How many employees leave the organization every year?
In which areas of business do we tend to lose themaximum number of employees?
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Human Resource Planning
HRP Process
Environmental Scanning
Strategic Planning
HRP
Demand Forecasting
Comparingrequirements &
availabilitySupply Forecasting
Surplus of workersDemand = Supply
Restricted hiring, Reducedhours, VRS, Layoffs,Restructuring,Retrenchment
Shortage of Workers
R&S, Overtime, Outsourceactivities, BPR, Rehireretired employees,temporary employees,Retraining
No Action
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Human Resource Planning
External Environment
Economic factors, including general, regional & global conditions.
Industry & competitive trends , including new processes, services
Technological changes, including IT, innovations & automation
Government & legislative issues.
Social concerns, including child care, elder care, the environment& educational priorities
Demographic & labor market trends including age, composition,and literacy
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Involves a set of procedures for making decisions about the organizations long term
goals and strategies.
Human Resource Management
Process of anticipating & making provision for the movement of people into, within,
and out of an organization
StrategicPlanning
Combines strategic planning & HR planning. It can be considered as the pattern ofhuman resource deployments and activities that enable an organization to achieve itsstrategic goals
HumanResource
Planning
StrategicHuman
Resource
Planning
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Human Resource Planning
Linking Strategic Planning & Human Resources
Mission, Vision & Values
StrategyImplementation
Evaluation
Strategy Formulation
Internal Analysis
External Analysis
Structure & People
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Corporate Strategy
Strategic alliances & joint ventures; Sony Ericsson, Renault SA and Mahindra & MahindraLtd.Sony Ericsson is a joint venture established in 2001 by the Japanese consumer electronicscompany Sony Corporation and the Swedish telecommunications company Ericsson to makemobile phones.Reason was to combine Sonys consumer electronics expertise with Ericssons technological
leadership.Renault is Frances largest car maker and Mahindra & Mahindra Ltd. Is Indias largest makerof SUVs. The two companies have come together to make Logan Sedan in India.
Focuses on domain selection; where will they compete. For example, IBM vis--vis Ford
HRP: Strategy Formulation
Growth & diversification ; IBM & GE
Mergers & acquisitions; HP & Compaq
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Key HR Activities Associated with Merger or Acquisition Phases
Participate in preselection assessment of targetfirm
Assist in conducting thorough due diligenceassessment
Participate in planning for combination Assist in developing HR practices that support
rapid learning & knowledge transfer
Identifying reasons for the M&A Forming M&A team/leader Searching for potential partners Selecting a partner Planning for & learning from managing the
process
HR Issues Key HR Activities
Selecting the integration manager (s)
Designing/implementing transition teams Creating the new
structure/strategies/leadership Retaining key employees Managing the change process Communicating to and involving
stakeholders Developing new policies & practices
Assist in recruiting & selecting Assist with transition team design & staffing Develop retention strategies & communicate to
top talent Assist in deciding who goes Facilitate establishment of a new culture Provide assistance to ensure implementation of
HR policies & practices
Solidifying leadership & staffing Assessing the new strategies & structures Assessing the new culture Assessing the concerns of stakeholders Revising & learning
Participate in establishing criteria & proceduresfor assessing staff effectiveness Monitor the new culture & recommend
approaches to strenghten it Participate in stakeholder satisfaction
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Business Strategy
Viewed in terms of domain navigation; how the company will compete against rival firms in
order to create value for customers.
HRP: Strategy Formulation
Low cost strategy by competing on productivity & efficiency and outsourcing; Wal-Mart,Southwest Airlines
Differentiation strategy by competing on value addition; Fed-ex and Sony
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Functional Strategy
Translate strategic priorities into functional areas of organization. In this regard HR policies &
practices need to achieve two types of fit: external & internal.
HRP: Strategy Formulation
External Fit/Alignment - Focuses on fit between the business objectives and & the majorinitiatives in HR.
Internal Fit/Alignment - HR practices should be aligned with one another internally to establish
a configuration that is mutually reinforcing.Job design, staffing, training, PA, compensation, all need to focus on the same workforceobjectivesCharles Schwab & Co.
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Assessing Current Human Resourcescurrent labour supply
Internal analysis includes information about the employees and skills they currently posses
HRPInternal Analysis
.
Staffing tablesMarkov Analysis
Inventory ReportHRIS / HRMSReplacement ChartsSuccession Planning
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Assessing Current Human Resourcescurrent labour supply
Staffing Table
HRPInternal Analysis
.
These are graphic representations of all organizational jobs, along with numberof employees currently occupying those jobs.
Future employment requirements derived from demand forecasts may also form a part
of staffing tables.
Markov Analysis
.
It shows the percentage (and actual number ) of employees who remain in each jobfrom one year to the next, as well as the proportions of those who are promoted,
demoted, or transferred, or exit the organization
It can be used to track the pattern of employee movements through various jobs
and to develop a transition matrix for forecasting labor supply.
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Markov Analysis for a Hypothetical Retail Company
HRPInternal Analysis
Figures in circles show the transition percentages
80%
12
20%
3
6%
2
11%
4
83%
30
11%
11
66%
63
8%
8
10%
29
72%
207
2%
6
16%
46
6%
86
74%
1066
20%
288
15%
14
2003-2004 St ore Asst. Store Section Dept. Sales Exit
Managers Managers Heads Heds Executives
Store Managers
(n = 15)
Asst. Store
Managers
(n = 36)
Section
Heads(n = 94)
Departmental
Heads
(n = 288)
Sales
Executives
(n = 1440)
Forecasted
Supply 16 41 92 301 1072 353
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Inventory Report
S.Is vary greatly in sophistication
The audits of non-managers is called skills inventories & those of managers are called management
inventories
HRPInternal Analysis
Purpose: to note what kind of skills, abilities, experiences & training the employees currently have
Useful in career planning, management development & related activities
Personal DataSkills, education, experience, trainingSpecial qualificationsSalary & job history
Capacity of individuals-scores on
psychological tests, health information
Special preference of individual : geographiclocation, type of job, work timings
Promotion potentialNumber & types of employees supervisedTotal budget managed
Previous management duties
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Inventory Report
HRPInternal Analysis
Name : A.K. Sen Date printed : 1-4-2004
Number : 429 Department : 41
Key words Work experience
Word Description Activity From To
Accounting Tax Supervision 1998 2000 Tax clerk ABC Company
and analysis
Book Keeping Ledger Supervision 2000 2002 Accountant XYZ Co.
Auditing Computer Anal ysis 2002 2003 Chief Accounts TT Bank
records Officer
Education Special Qualifications Memberships
Degree Major Year Course Date 1. AIMA
MBA Finance 1998 DBF 1996 2. ISTD
B.Com Accounts 1995 Risk Management 1999 3. ICA
Computer Languages Position Location Hobbies
Literacy preference choice
Tally French Accounting Kolkata Chess
Banking Auditing Delhi Football
Software Bangalore Boating
Employees Signature __________ HR Department________
Date _______________________ Date ________________
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HRIS / HRMS
HRIS is an integrated approach to acquiring, storing, analyzing, and controlling the flow ofinformation throughout an organization.
The system might contain a program for tracking applicants, a skill inventory, a careerplanning program, and employee service programs such as an electronic bulletin board.
MCI Telecommunications uses SmartSearch2, an automated resume tracking system, toidentify qualified applicants quickly & accurately.
Ford (B2E)
HRIS (HRMS) is a database system that keeps important information about employees in a
central and accessible location, even information on the global workforce.
HRPInternal Analysis
An effective HRIS also provides online data and forecasts related to business operations:
Exception reports: highlight variations in operations that are serious enough to require managements
attention. For example, quality exception report.On demand reports: provides information to a specific request.
Forecasts: A forecast applies predictive models to specific situations. For example, forecasts and the
number and types of employees required to satisfy projected demand for the firms product.
Succession Planning
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Succession Planning
Jack Welch
In 1994, years before he retired from GE, Jack Welch had startedthe succession planning process. SP is an ongoing, rigorous andchallenging process at GE. GE adopted SP right from the mid1900s. At GE, succession planning was not confined to only thetop management, but was applies across all tiers of management.The managers of GEs various businesses were encouraged to
identify potential candidates and fulfil their development needs,and transform them into efficient leaders ready to take up top jobsat the company.
The company mainly used annual performance reviews foridentifying potential candidates, until early 1980s. However, afterWelch took over as the CEO, the SP process at GE became amore systematic process, with the use of various analytical toolsand the involvement of the top management in leadership
development and SP. Since early 1980s, the annual HumanResource Reviews had been at the heart of SP at GE. Thisprocess was reportedly given as much importance as financialmonitoring in GE.
The process of identifying, developing, & tracking key individuals so that they may eventually assume
top-level positions.
Research suggests that in organizations where S.P efforts occur, employee morale is increased by 25%.
Succession Planning
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Succession Planning
Jack Welch
CEO Succession Planning
During Welchs tenure of two decades as CEO, GE transformeditself from a manufacturer of light bulbs and appliances into anindustrial conglomerate, with annual revenues increasing from$27.9 billion to $130 billion.
He developed a list of qualities, skills and characteristics a CEOshould essentially have. So, GE was ready for its nest CEO, yearsbefore it finally had to make the decision in 1999. The SP by Welch
for his post had started way back in 1994, when Welch with help ofBill Conaty and Chuck Okosky, both VPs, HR & ED, created a listof essential qualities, skills and characteristics an ``ideal CEO
should possess. The list mainly included elements such as integrityand values, vision, leadership, experience, edge stature, fairness,energy, balance, insatiable appetite for enhancing knowledge,courageous advocacy, and most importantly, stomach to play forhigh stakes and being comfortable operating under a microscope.
As part of CEO succession planning, GE shifted its key candidatesfrom one business to another to enable them to gain experienceacross all its businesses.
Succession Planning
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Succession Planning
Jeff Immelt
The three candidates for the top spot at GE were Jeff Immelt the
President and CEO of GE Medical Systems, W.James McNerneyCEO of GE Aircraft System, and Robert L. Nardelli President andCEO of GE Power Systems.
Jeff Immelt gets Selected
In Nov2000, GE announced that Jeff Immelt would be the
successor to Jack Welch, the Chairman and CEO of the Company.
Welch was to retire in Sep, 2001, after a successful stint at GE.The announcement ended the battle that was viewed on WallStreet as the hottest corporate succession race of the decade.
Succession Planning
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Succession Planning
Jack Welch
Welch wrote in his autobiography, that choosing between the final
trio ``was the most difficult and agonizing decision I ever had tomake...all the three exceeded every expectation we set for them.Their performance was off the charts. Any one of the three couldhave run GE. Acc. To Welch it was his nose and his gut which
prompted him to select Immelt. Analysts believed that the fact thatImmelt was younger than the other two aspirants at 44 years ofage, contributed to his selection. GE is known to favour steadyleadership over a long period. Since Immelt was six years younger
than his rivals, he would have an opportunity to plan for a further20 years at GE, like Welch who became the CEO at about thesame age, and stayed with the company to implement his plans.Welch too characterised Immelt as `a natural leader, and ideallysuited to lead GE for many years adding weight to this view.
The fact that McNerney and Nardelli were taken on as the CEOs of3M and Home Depot resp., within weeks of their losing out toImmelt, was itself taken by observers as testimony of Corporate
Americas confidence in leaders groomed by GE.
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HRP Internal Analysis
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Acceleration Pools
Succession planning is a lost art-a casualty of mergers, downsizing, and reengineering
HRPInternal Analysis
Management succession programs typically focus on placement rather than skill development.
Acceleration pools is management succession planning system that develops a group of high potentialcandidates for undefined executive jobs and focus on increasing their skills and knowledgeratherthan targeting one or two people for each senior management position.
HRP Internal Analysis
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Predicting Future Labour Supply
Increase in Internal Supply of Labor
HRPInternal Analysis
.
New hiresContingent workers
Transfer-in
Promotions-inDemotion-in
Individuals returning from leaves
Decrease in Internal Supply
RetirementsDismissals
Transfer-out
PromotionoutLayoffs
Voluntary quits
Sabbaticals
Prolonged illness
HRP Internal Analysis
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Estimated Internal Labour Supply for a Given Firm
Can be used where it is possible to apply work measurement to calculate the length of operations and the
amount of labor required
HRPInternal Analysis
The FirmSources of Inflows
Transfers
Promotions
New Recruits
Recalls
Promotions
Quits
Terminations
Retirements
Deaths
Layoffs
Employees In Employees Out
Current
staffing
level
Projectedoutflows
this year
Projected
inflows
this year
Firms internal
supply for this
time next year
+ =
Projected Outflows
Current Staffing
Level
HRP Internal Analysis
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Demand Forecasting
Demand forecasting is the process of estimating the future quality and quantity of people required.
HRPInternal Analysis
.
Expert ForecastsDelphi TechniqueNominal Group TechniqueRatioTrend Analysis
Workload Analysis
A forecast of labor demand is derived from a projection of how business needs will affect HR.
Basis would be the annual budget & long term strategic plan, translated into activity levels for each
function and department
Qualitative and Quantitative methods
HRP Internal Analysis
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Demand Forecastingexpert forecasting
Bottomup or top down approach; Involves expert forecasting-experience, intuition & guesswork
HRP Internal Analysis
Considerations-work load, abilities of employees, future workload, future capabilities of employees
Analysis-person by person & job by job, present & future needs.
Demand Forecastingdelphi technique
Originally developed by the Rand Corporation, this technique elicits expert estimates from a no. of
individuals.
The HRP experts act as intermediaries, summarize the various responses & report the findings back to
the experts.
The distinguishing feature of Delphi technique is the absence of interaction between the experts.
HRP Internal Analysis
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Demand ForecastingNominal Group Technique
Individual estimates are followed by group brainstorming sessions
HRP Internal Analysis
It can also help to offset domination by a single person in group decision making by providing an equal
opportunity to provide opinions.
Demand ForecastingRatio Trend Analysis
Forecast is developed based on a past relationship between a factor related to employment &
employment itself
E.g., Sales levels, production level, activity/workload level to employment needs
Trend projections relate a single factor to employment.
2001-02 Production of Units : 5,000
2002-03 No. of Workers : 100
Ratio : 100:5000
2003-04 Estimated Production : 8,000
No. of Workers required : 8000 100 = 160
5000
HRP Internal Analysis
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Demand ForecastingWorkload Analysis
Can be used where it is possible to apply work measurement to calculate the length of operations and the
amount of labor required
HRP Internal Analysis
WLA is used to determine how many employees of various types are required to achieve total production
targets.
Planned output for the year 10,000 pieces
Standard hours per piece 3 hoursPlanned hours required 30,000 hours
Productive hours per person per year 1,000 hours (estimated on annual basis)
(allowing for absenteeism, turnover, idle time etc.)
No. of workers required 30
If span of control in the unit is 10 per officer, then 3 officers are also required.
HRP
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Manpower Gap Analysis
This is used to reconcile the forecasts of labor demand and supply. This process identifies potential skill
shortages or surpluses of employees, skills and jobs
Estimating Manpower Requirements
Year
1 2 3
1. Number required at the beginning of the year
2. Changes to requirements forecast during the year DEMAND3. Total requirements at the end of the year (1+2) ------- ------
4. Number available at the beginning of the year
5. Additions (transfers, promotions) SUPPLY
6. Separations (retirement, wastage, promotions out and other losses)
7. Total available at the end of year (4+5+6) --------------------
8. Deficit or surplus (3-7) RECONCILIATION
9. Losses of those recruited during the year OF THE ABOVE
10. Additional numbers needed during the year (8+9) MANPOWER NEEDED
HRP
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Surplus & Deficit of Workforce
Organizational downsizing & restructuring
Making layoff decisionsRetrenchment
Voluntary Retirement SchemeRestrict Hiring
Reduce work hoursUse slack time for employees training or
equipment maintenanceTransfer out, promotion out, demotion out
Surplus of Workforce
Hire new full time employeesOvertime
Outsource activities to othercompanies/consultantsAttempts to reduce labor turnover
Business Process Reengineering to reducethe needs
Rehire retired employees on a part time basisHire temporary employeesTraining & Development
Transfer in, promotion in, demotion inRetraining & Redeployment(to assign people
to new positions or tasks).
Deficit of Workforce
Recommended