Report On HR Planning

Of Energypac BD Ltd

INTRODUCTION:

Often, business time-frames are too short to encourage good strategic planning. The best

companies take the time and do it well. Workforce planning or Human Resources Planning

as it is commonly called is one of the most impact full aspects of business planning.

Management literature is packed full of reasons why HRP is crucial to business success.

Without it there is little chance of the business having the right people at the right place at

the right time doing the right work.

This issue has been studied for decades. In a 1985 study based on a survey of 53

corporations in the US and Canada and their approaches to business and human resource

planning Elmer Burack found that “the respondents, both human resource and business

planners, emphatically endorsed the concept that strategic and long-range business plans

should include a human resource component.” That position is one still held firmly by

business executives globally.

Human resources planning in the broadest sense include both strategic and operational

human resource planning as a continuous process rather than an activity limited to a fixed

segment of the business planning process. Often HRP is considered to be a “human

resources” program rather than a necessary business activity. Operationally driven

managers often forget the real purpose of planning. “By definition, the strategically driven

human resource function will be devoted to finding ways to help the organization gain

important advantages over its competitors.” Those advantages are often described in terms

of the capacity that a business has with which to pursue its objectives. “The capacity of an

organization to achieve its strategic objectives is influenced by human resources in three

fundamental ways: cost economics; capacity to operate effectively; capacity to undertake

new enterprises and change operations.” This discussion is divided into sections covering

planning, workforce planning, management resources planning and a summary.

Company Overview:

Energypac is one of the leading power engineering companies in Bangladesh. Continual

research and development, state of the art production facility, quality products, competent

services, and countrywide operations have made it warmly acceptable to the customers.

Energypac was incorporated in 1982 as a private limited business enterprise. It is powered

by 1200 skilled manpower of which 150 are graduated engineers. The relentless efforts and

dedication of these people are providing continual help to improve technology to innovate

and develop new products, just in time delivery, pre and post sales services to maintain a

long term business relationship with the customers. To meet countrywide demand of its

products and services, Energypac has extensive distribution network throughout Bangladesh

with full-fledged offices in the major cities like Chittagong, Khulna, Rajshahi, Sylhet, and

Bogura. In an effort to introduce its products globally, Energypac has established its offices

in India, and China. Energypac has already experienced its products and service supply to

India, Yemen, Ghana, Sudan, Uganda, Nigeria, Saudi Arabia, and United Kingdom.

Energypac is an ISO 9001:2008 and 14000:2004 certified company. Energypac enhances the

business of its customers by providing them with complete solutions. While creating better

and environmentally compatible technologies, Energypac focuses on the customer’s

demand with appropriate products and solutions as well as services.

Vision, Mission and Strategy:

Vision

We will be the most preferred business partner of our customers.

Mission

We will provide total power solutions to enhance the business of our customers,

concurrently creating better technologies that benefit both the customers and the

environment.

Strategy

Our strategic aim is to strengthen the leading position we enjoy in our markets, and to

ensure continued growth. We rely on our capability to integrate and deliver solutions from

our broad equipment and service portfolio which meet the specific needs of our customer

segments globally. Our priority is to offer the best efficiency, reliability and value available.

Products & Services:

Energypac Engineering Limited presets a wide range of products and services for its valued

customers. Apart from our standard offerings, we provide our clients customized offers

suitable to their demands.

Our Products:

Our illustrative product range includes the manufacturing, marketing and powering with

complete solutions or as per customer demand. All of our products are manufactured at

controlled environment following international standards like IEC, BS, and ANSI. Our range

of products can be broadly categorized as:

Transformer

Power Transformer

Distribution Transformer

Instrument Transformer

Other Transformers

Switchgear

Outdoor Vacuum Circuit Breaker

Indoor Vacuum Circuit Breaker

Control, Metering, and Relay Panels

Indoor Type Load Break Switch

Disconnecting switch

Outdoor Off-load Disconnections

Indoor Type Load Break Switch

By-Pass Switches

Protection and Automation

Spare Parts

Our Services:

Energypac Engineering Limited provides comprehensive services to the customers on

turnkey basis or as and when required by the customers. Our services are catered but not

limited to the followings:

Installation and Commissioning

Service and Maintenance

Engineering, Procurement, and Construction (EPC)

Tests:

We maintain strict compliance of quality in our entire manufacturing process. Meticulous

procedures are followed in every step of the production. To ensure better quality, we use

modern testing equipments. Our testing procedure verifies that our design and construction

withstands the conditions stipulated by national and international standards. Tests are

performed into two main categories:

Routine Tests

Type and special Tests

Sales and Marketing:

Energypac Engineering Limited is a customer oriented company to understand, produce,

sell, and post sales caring of its products and services. We take pride on learning our

customer’s demand until we comprehend their demands. Our young, dynamic and

responsive sales and marketing people are scrupulous to attend customer’s enquiry, visit

them, discuss the demands, and providing suitable solutions as to customer’s demand. We

are catering our entire market segment in three broad categories, namely:

Project Sales: Project Sales Department handles the enquiries mainly from the public

sector. Mostly, these sales are based on competitive local and international biddings. A

team of intellects are engaged to explore demands, understanding the materialistic and

documentary requirements, bid submission, contract signing. Spectacular growth has been

achieved in this sector having tough competition with local and international bidders.

Thanks to our colleagues who has made it a success through their sincere efforts.

Private Sales: Private Sales Department is one of the most departments of Energypac who

are dedicating widespread efforts to take lead in the local market especially in the private

sector. They have intense contacts with the customers and the business channel partners.

They cater our products to all section of customers starting from individual to corporate.

Export Sales: Export Sales Department is dedicated to promote our business beyond the

border of Bangladesh. Its main responsibility is to source local partners in the intended

country of business, look for business opportunities, and extend necessary supports either

directly or through our business partners. We are inspired that we have received expected

response from the countries we have aimed to do business. Our vision is to place signature

of our products and services across the globe

Brief Overview of HRM

Meaning of HRM

Human resource including the experiences, skills, knowledge, judgment and creativity

belonging to the organization along with the means of organizing, structuring, and

rewarding these capabilities. Human resource management is concerned with the flow of

people into, through, and out of an organization. Human resources planning involve

forecasting the need for labor and supply of labor and supply of labor, then planning the

programs necessary to ensure that the organization will have the right mix of employees

and skills when and where they are needed.

Functions (Activities) of HRM

The functions include a wide range of activities that create a direct impact on each and

every part of the organization. The society of human resource management has identified

six major functions:

i) Human resource planning, recruitment and selection.

ii) Human resource development.

iii) Compensation and benefits.

iv) Health and safety.

v) Employee and labor relation.

vi) Human resource research.

H R Process

The process of H R planning involves the following steps:

a) Setting Organizational Objectives:

The objectives of the organization must be determined at first. To reach to goals of the

enterprise number of persons and their require fitness, experiences and qualities have to be

ascertained.

b) Studying the Environment:

On the work of the environment the internal and external environmental factors have

impact and influence. So production target, and its socio-economic condition, competition

in the markets.

c) Formulating short-term and long-term planning:

In this phase, specific schedules to be used for short-term and long-term shall be prepared

indicating required personnel strength with their skill and efficiency.

d) Finding Present Manpower:

There shall be record of employees working at different levels and position. This shall be

used for future information and evaluation.

e) Labor Market:

On preparing a manpower list, available sources, both internal and external, have to be

searched out and made a comparative analysis.

f) Preparing Manpower Forecasting:

At this stage, a complete manpower forecasting are to be made showing:

i) Retirement, termination, promotion of employees.

ii) Probabilities of changing organizational policies.

iii) Probable expansion of Business.

iv) Possibilities of technological change.

v) Demand of the employees’ etc.

g) Implementing the Program:

For implementation of the HR program, employee recruitment, placement, job evaluation,

training and development, motivation, wages and salary structure, promotions and transfers

etc. should be prepared in schedules.

h) Adapting the Plans:

Plans should be compared with achieved result, finding deviations if any and taking

corrective measures thereof. Plans have to be adapted to the total situation in the

organization with environmental changes.

Management and Employee Relations

Employee – management relation or industrial relation indicates the relation between the

employers and the employees. The concept is wider. The concept includes the relationship

between the management and the employees, between employers and employees,

between the owners and the trade unions, between unions and unions, and between the

employers and the government. The term industrial relations explain the positions of the

employees and the employers at large directly or indirectly.

The Human Resource Management

There are four functional areas of management that any business must concern it with.

These are Production Management, Marketing Management, Financial Management, and

Human Resource Management. HR Management in a design firm has three primary

functions: acquiring human resources, developing human resources, and maintaining

human resources- in other words, staff recruitment, retention, and development. A fourth

function has recently been added to these: minimization of employment-related liability

issues. Liability issues are becoming a greater and greater concern to design firms, as all

management activities today have potential liability implications.

Good Human Resource Management is good business

There's better way to sell managers on a new ides than to appeal to them, rationally and

economically. Although it's not always possible to justify what you propose economically, it

could probably be done far more often than often than most people realize. And there really

is some tangible economic benefits to effective HR management in a garments company.

Those economic benefits fall into one of two categories- indirect benefits and immediate

benefits. Indirect benefits to the company arise from not being punished for some misdeed.

These misdeeds and their penalties including firing someone for the wrong reasons, then

getting slapped with a lawsuit; violating the fair Labor Standards Act damages judgment; or

having one of your managers make unwelcome sexual advances to an employee, thus

getting the stuck with a million- dollar sexual harassment suit. Good HR management

provides tangible economic benefits to the firm by minimizing the likelihood of these

events.

Some more justification for good HR management

Between 1986 and 1988 JURY verdicts in wrongful discharge cases averaged.

Design firms are in the business of selling labor and are therefore only as good as

their people.

About 15 percent of the women in U.S. companies say they've been sexually

harassed on the job in the past year.

The competition for experienced staff has never been greater than was in the 1980s,

and it will undoubtedly get worse in the 1990s.

About 115 percent of workers age 51 and older in Fortune 500Companies say

they've been discriminated against because of age.

Health benefit costs are skyrocketing, with some firm's premiums increasing by 50

percent to 100 percent per year.

It should be apparent by now that good HR management saves both and makes money!

Some Statistics

The next step in the process is to set some very specific goals for HR management efforts.

This is tough for many firms because, in most cases, they don't have any historical data to

use as benchmarks for how they are currently doing. As a bare minimum, performance

statistics should be maintained in each of the following areas:

Turnover

New often each position in the firm, branch, department, or job category is filled with

someone new over the course of the time period specified. Performance statistics should be

kept on professional, technical, and support turnover and on department-by-department,

office-by-office, and firm wide range o turnover, they should be reported on a current

month, year-to-date and annual projected basis each month.

Staff numbers

The number of people, who work in the firm, branch, department, or job category. Numbers

should be kept on a professional, technical, support, department-by-department, office-by-

office, and firm wide basis. They should be reported on a current month, year-to-date and

annual projected basis each month.

Utilization Rates:

The percentage of staff time charged to billable projects. Utilization rate performance

statistics should be kept on a professional, technical, and support, department-by-

department, office-by-office, and firm wide basis. They should be reported on a current

month, year-to-date and annual projected basis each month.

Number of position open:

The number and type of positions open in the firm positions filled reported on a current

basis each month.

Agency/ Search firm fees:

The total dollar amount paid out to employment agencies and search firms. This should be

reported month and should include data on the current month, year-to-date, and annual

projection compared to budget

Human Resource Goals:

Employment advertising expenditure:

The total dollar amount paid out for employment advertising. This should be reported

monthly and should include data on the current month, year-TO-date, and annual projection

compare to budget

Employee relocation expenditures:

The total dollar amount paid out by the firm to relocate new employees. This should be

reported monthly and should include data on the current month, year-to-date, and annual

projection compared to budget.

Interview / Offer Ratio:

The number of candidates the firm interviews for a position before extending an offer. This

statistics should be kept on a current month and year-to-date basis and reported monthly.

Offer/ acceptance ratio:

The number offers for employment the firm formally extends compared with the number of

acceptances received.

Human Resource Management & the Quality Improvement Effort:

1. Make sure all teams work within a policy- deployment process to ensure their

efforts are consistent with the firm's goals. Do not institute quality improvement

teams as separate, parallel organization structures. Simply trying to superimpose

such teams outside the normal chain of command elicited resistance from

supervisors, many of whom made comments like "I don't know what these people

are doing -they're not helping me do my job". The teams should, to the greatest

extent possible, be composed of natural work units.

2. Do not treat the quality improvement program as if it has and end. It is important to

emphasize that it is really a systematic and continuing way of doing business, one

that has no end.

3. Recognize that training is essential. Quality improvement is successful largely

because training continually upgrades the problem analysis and statistics skills of

even first-line employees. This training is crucial both to provider the required

analytical skills and also to emphasize the firm's commitment to the program.

4. Remember that whether or not the company achieves its quality goals is important

but almost secondary. The new employee values that emerge are the heart of the

program.

How to be an effective manager

One of the primary duties of a manager is to keep the performance of employees at a high

level. Indeed, much of what a manager does will affect the productivity level of the

employees he or she supervises.

There are four general techniques that have a great effect on the productivity of an

employee. They are:

-Coaching

-Feedback

-Counseling

-Discipline

Coaching is the ongoing, informal training and encouragement that a manager gives

employees on a regular basis. It confirms to the employee that he or she is doing well and

gives him or her confidence to continue the behavior. It most often takes place while the

employee is working.

Feedback occurs when managers provide specific information to employees to let them

know how well he or she is performing. This frequently takes place while the employee is

working or when he or she has just completed a task.

The Human Resources Process

The activities involved in human resources management should be viewed as a series inter

related steps that managers and specialists perform to acquire and maintain the right

people in the right positions.

\

Human Resource Planning:

Well managed companies must forecast future personnel needs carefully. They are for too

important to be left to guesswork. The overall human resources planning process for an

organization, which includes forecasting the demand for and supply of personnel, has three

parts:

1.Human

Resource Planning

2.Recruiting

3.Selection

4.Orientation

5.Training

6.Performance Appraisal

7.Rewards,

Promotion, Transfer,

Demotion

8.Separation

I. Forecasting the personnel requirements

II. Comparing the requirements with the talents of present employees, and

III. Developing specific plans for how many people to recruit.

Human resources forecasting:

Human resources forecasting attempts to predict the organization's future demands for

people and for jobs. Major factors to be examined are the company's objective (growth,

construction, status quo) and the employment history of the company (retirements,

resignations, terminations, promotions, and deaths). The combination of these two sources

results in an initial forecast of personnel needs.

Job analysis

Job analysis is the gathering and analyzing of data about a specific job so that a job

description and job specification can be written. It clarifies the nature of the work and the

conditions under which it is done.

Job description

Job description is a written summary of the scope, function, duties, responsibilities, and

relationships involved in a job. Job descriptions help management to select, orient, and

compensate employees effectively.

Job specification

Job specification is a document that describes the characteristics and qualifications needed

in someone who could successfully perform a given job. Job specification helps managers

determine an applicant's fitness for a certain position by defining qualifications for

education, training, experience, and behavioral qualities the person must have to perform

the job. A company is much more likely to recruit and eventually sect beer employees if it

has clear job specification.

Recruitment:

By recruitment the organization attempts to identify and attract candidates to meet the

recruitments of anticipated or actual job openings.

Objectives:

Ensuring compliance by organization with government Regulations

Maximizing the pool of applicants at minimum cost.

Attracting suitably qualified & skilled applicants.

Energypac BD Ltd follows some General Guide Lines for recruitment

The Company employs the best person for every position amongst those available

for selection, according to the company's authorized Employment procedure.

No employment in any category can be made unless the position has been

approved in writing by the management.

Minimum Educational standards are laid down for every position depending on the

requirement of the position.

No discrimination is made in selection due to religion, cast, creed or Regional

considerations.

Ordinance Instruction.

No discharged or dismissed workers of the company shall be reemployed except

under the requirements of law.

There are two sources of applicants- internal and external. Internal sources are the

employees of the organization. This has a positive impact on the organizational member and

the internal working environment. The opportunity for advancement has three distinct

benefits:

1. It can reduce turnover.

2. Provide incentive to learn jobs quickly and

3. Assist in making the individual a functioning member of the organization

faster because the person already knows the policies and expectations of the

company.

Another method is to attract candidates by announcing job openings in company

newsletters and by posting position vacancies on bulletin boards. This strategy provides all

employees the equal opportunity to apply if they see the notices.

Types of Recruitment:

As per this schedule of recruitment,- selection of any personnel against any specific post will

be done in two ways as follows:

a. Direct recruitment, and

b. Recruitment through promotion.

a. Direct Recruitment:

It will be done through open advertisement. None of the applicants will be considered for

direct recruitment unless he/she:

Fulfils the criteria mentioned in SIL schedule.

If any post as per schedule is not available for promotion, and if it is not referred by the

selection committee.

Probation:

Anybody recruited directly will be under probation for a period of three months.

But the concerned department or recruiting committee can extend the probation

period for further three months.

The management has right to cancel the service contract if his/her performance is

found to be unsatisfactory during the probation period.

Confirmation of service depends on the satisfactory performance of the candidate.

b. Recruitment through Promotion:

Management can fill certain posts through promotion if candidates are found

available & suitable for the required post.

None will be considered for promotion if his/her service record is Unsatisfactory.

Recruitment Procedure:

Providing advertisement in the newspaper, local areas

Providing notice on the notice board.

Head-hunting

Interviews are conducted on the candidates, which includes the following process.

a. Viva voice

b. Practical test on individual's skill.

c. Health test by company appointed physician.

Appointment letter is issued to the selected candidate that includes the detailed terms of

employment.

Upon joining the company, a separate file is created for the individual worker in

order to maintain his/her service records. This file contains the following

information.

i. Detailed bio-data of the employee.

ii. Job application.

iii. Evaluation report during the interview.

iv. Educational certificates and/or .

v. Age certificate.

vi. Increments & benefits

Interpretation:

Form my point of view internal sources sometimes may not hold good for mid and upper

level positions requires specialized training and experience, if they are not available within

the organization.

For certain opening it may be necessary to hire individuals from the outside who have

gained form another employer the knowledge and experience for the jobs.

Selection:

Selection is the process of deciding which candidates, out of the pool of applicants

developed in recruiting, has the abilities, skills and characteristic that most closely match job

demands. The decision comes after the candies go through a series of steps that compose

the selection process.

Selection process:

The decision making system used to identify which job applicants are best suited to the

vacant position.

Key aspects:

-Reliability

-Validity

-Selection devices.

Orientation:

Once an employee is hired, it is important to bring the person into the mainstream of

organization as quickly as possible. Firms accomplish this by developing and orientation

program-a series of activities that gives the new employees information to help them adapt

to the organization and their new jobs.

Training & Development

What is training?

Training is a systematic process of changing behavior or attitudes of employees to improve

the organization's effectiveness. It is usually accomplished by providing learning experiences

or educational opportunities to staff members. Learning is not an end in itself; training

should improve job performance. In addition to improving job- related skill, training

experiences can also be a significant motivator. In one study of the motivations of

professionals, the chance to grow and learn was fourth on the list of important motivating

factors.

Development:

Development refers to teaching managers and professionals the skills needed for both

present and future jobs. Since training involves learning, certain principles of learning theory

apply to job- related training for design and other technical Professionals. These principles

are: All human beings can learn, even if not at the rate

To orient new hires

Teach new employees how to perform their initial assignment

To learn, individuals must be motivated.

Learning is active process and is stimulated by involving the senses.

Performance:

Performance is defined as evaluating an employee’s current as past performance relative to

his or her performance standards. Keith Davis said that “It is the process through which the

organizations access the quality of work of its employees and attempts to improve the

performance.”

Promotion

One employment decision is a promotion. A promotion is a movement by a person into a

position with higher pay and greater Responsibilities. Promotion reward competence and

ambition. They act as incentives to perform above the average in one's present job and to

expand one's abilities, aptitudes, and knowledge through additional training.

Promotion decisions, even though they should be rewards for performance, often are

influenced by other factors, federal and state laws affect the ways in which promotions can

be made. Affirmative action programs may dictate who or what kind of person gets the

promotion. Promotion of the best qualified and most eligible may be blocked by seniority

rules and the union performance.

a. Termination of service:

For termination of the service of a permanent/temporary employee by the employer, his

employer shall give 120 days’ written 'notice in the case of permanent employee and 60

days' written notice in the case of Temporary Employee. Provided that pay for 120 days or

60 days' as the case may be shall be paid in lieu of such notice provided further that the

worker whose employment is so terminated, shall be paid compensation at the rate of one

month's pay for every completed year of service or for any part thereof in excess of six

month in addition to any other benefits to which he may be entitled to under the terms of

employment.

b. Resignation:

1. A permanent employee shall be required to give one month's written Notice in case

of resignation from the services of the company.

2. An employee who resigns from service of the company but fails to give the required

notice shall surrender pay in lieu of such notice thereof.

3. The employer shall accept the resignation if due notice is given or due payment in

lieu of notice is made pay is surrendered in lieu of such notice.

4. Notwithstanding anything stated above no employee against whom a disciplinary

proceeding is pending shall resign from the service of the company unless 60 days'

have elapsed from the drawing up of the departmental proceeding.

c. Discipline & grievance procedure;

1. Where an employee of the company in the option of the employer is inefficient, or

2. Corrupt, or

3. Guilty of misconduct under Bangladesh Labor & Industrial Act, the employer may

impose one him/her or more of the penalties, if after enquiry. S/he is found guilty of

any of the charges.

Human Resource Planning:

There are numerous considerations that the human resources professionals must take into

account. For instance: “Inconsistencies between culture and strategy can severely impair

the successful pursuit of a given course of action.” Often the political aspects of producing a

viable plan are insurmountable obstacles to overcome; as are other primary factors such as

the process itself or the plan measurements. Only the most seasoned corporate politician

often has enough sensitivity and negotiating skill to achieve the pre-planning buy-in of the

critical powers.

The concept of planning boiled down is that in order to determine the direction for human

resource plans you must have “a series of questions that your organization needs to answer

in order to predict and perhaps control some of the major change areas for the future. This

means that you begin by asking the right questions – the questions which, if asked regularly

and systematically, will force you to produce answers of maximum value in shaping your

future human resources.” It is also important to look at the planning activity from an activity

standpoint. From an operational view human resources planning is the analysis of human

resource requirements of organizations and the related needs for management policies,

programs and resources to satisfy these requirements. As is shown by Figure A, human

resources planning are critically interdependent with all aspects of the business. “A human

resource strategy is a critical component of the firm’s corporate and business strategies,

comprising a set of well-coordinated objectives and action programs aimed at securing a

long-term, sustainable advantage over the firm’s competitors. A human resource strategy

should be consistent with the firm’s corporate and business strategies, as well as with the

other managerial functional strategies.”

The primary objective of people responsible for doing human resources planning is to

acquire, develop and implement the technology, tools, expertise and resources necessary to

effectively do Human Resource Planning and Development as an integral part of the

business planning processes. It must not be done in a vacuum. “Human resource strategies

should be developed within a company’s strategic business planning process.”

The strategy that is often the basis for the planning process is to build networks of internal

human resources professionals and external human resources professionals that will

promote the sharing of information, technology and tools to be applied to the Human

Resource Planning and Development activities; Collect, evaluate and implement tools,

processes and resources; integrate tools and resources into a consistent strategy which uses

existing resources whenever possible. Again and again it is important to make sure that the

process is a legitimate piece of the company plan. “Human resource strategic planning takes

place within the overall corporate / total organization strategic planning model “They will

consult with and to human resource managers and line management to achieve a high

utilization of tools and resources to achieve functional goals. Those goals include creating

and implementing a workforce inventory and forecasting tool customized for Line

Organizations; and creating and consulting on custom management planning tools and

strategies for line Organizations.

Figure A is an overview of human resource planning from a strategic planning viewpoint.

The model shows the relationship of internal factors and external factors as they relate to

the human resources issues. They are factors that not only create; but also shape and

change the issues. The business plan usually establishes the basic environment within which

other variables impact in order to determine those issues. Out of those issues grow the

human resources strategies and plans that are most often developed and implemented by

and with the assistance of the human resources department.

When it concerns human resources, there are the more specific criticisms that it is over-

quantitative and neglects the qualitative aspects of contribution. The issue has become not

how many people should be employed, but ensuring that all members of staff are making an

effective contribution. And for the future, the questions are what are the skills that will be

required, and how will they be acquired.

There are others, though, that still regard the quantitative planning of resources as

important. They do not see its value in trying to predict events, be they wars or takeovers.

Rather, they believe there is a benefit from using planning to challenge assumptions about

the future, to stimulate thinking. For some there is, moreover, an implicit or explicit wish to

get better integration of decision making and resource across the whole organization or

greater influence by the centre over devolved operating units.

Cynics would say this is all very well, but the assertion of corporate control has been tried

and rejected. And is it not the talk of the process benefits to be derived self indulgent

nonsense? Can we really afford this kind of intellectual dilettantism? Whether these

criticisms are fair or not, supporters of human resource planning point to its practical

benefits that optimizing the use of resources and identifying ways of making them more

flexible. For some organizations, the need to acquire and grow skills which take time to

develop is paramount. If they fail to identify the business demand, both numerically and in

the skills required, and secure the appropriate supply, then the capacity of the organization

to fulfill its function will be endangered.

Why HR Planning:

Human Resource Planning: an Introduction was written to draw these issues to the attention

of HR or line managers. We address such questions as:

What is human resource planning?

How do organizations undertake this sort of exercise?

What specific uses does it have?

In dealing with the last point we need to be able to say to hard pressed managers: why

spend time on this activity rather than the other issues bulging your in tray? The report tries

to meet this need by illustrating how human resource planning techniques can be applied to

four key problems. It then concludes by considering the circumstances are which human

resource can be used.

1. Determining the numbers to be employed at a new location

If organizations overdo the size of their workforce it will carry surplus or underutilized staff.

Alternatively, if the opposite misjudgment is made, staff may be overstretched, making it

hard or impossible to meet production or service deadlines at the quality level expected. So

the questions we ask are:

How can output be improved your through understanding the interrelation between

productivity, work organization and technological development? What does this

mean for staff numbers?

What techniques can be used to establish workforce requirements?

Have more flexible work arrangements been considered?

How are the staffs you need to be acquired?

The principles can be applied to any exercise to define workforce requirements, whether it

be a business start-up, a relocation, or the opening of new factory or office.

2. Retaining your highly skilled staff

Issues about retention may not have been to the fore in recent years, but all it needs is for

organizations to lose key staff to realize that an understanding of the pattern of resignation

is needed. Thus organizations should:

monitor the extent of resignation

discover the reasons for it

establish what it is costing the organization

Compare loss rates with other similar organizations.

Without this understanding, management may be unaware of how many good quality staff

is being lost. This will cost the organization directly through the bill for separation,

recruitment and induction, but also through a loss of long-term capability.

Having understood the nature and extent of resignation steps can be taken to rectify the

situation. These may be relatively cheap and simple solutions once the reasons for the

departure of employees have been identified. But it will depend on whether the problem is

peculiar to your own organization, and whether it is concentrated in particular groups (eg by

age, gender, grade or skill).

3. Managing an effective downsizing programmed

This is an all too common issue for managers. How is the workforce to be cut painlessly,

while at the same time protecting the long-term interests of the organization? A question

made all the harder by the time pressures management is under, both because of business

necessities and employee anxieties. HRP helps by considering:

the sort of workforce envisaged at the end of the exercise

the pros and cons of the different routes to get there

how the nature and extent of wastage will change during the run-down

the utility of retraining, redeployment and transfers

What the appropriate recruitment levels might be.

Such an analysis can be presented to senior managers so that the cost benefit of various

methods of reduction can be assessed, and the time taken to meet targets established.

If instead the CEO announces on day one that there will be no compulsory redundancies and

voluntary severance is open to all staff, the danger is that an unbalanced workforce will

result, reflecting the take-up of the severance offer. It is often difficult and expensive to

replace lost quality and experience.

Where will the next generation of managers come from?

Many senior managers are troubled by this issue. They have seen traditional career paths

disappear. They have had to bring in senior staff from elsewhere. But they recognize that

while this may have dealt with a short-term skills shortage, it has not solved the longer term

question of managerial supply: what sort, how many, and where will they come from? To

address these questions you need to understand:

the present career system (including patterns of promotion and movement, of

recruitment and wastage)

the characteristics of those who currently occupy senior positions

the organization’s future supply of talent.

This then can be compared with future requirements, in number and type. These will of

course be affected by internal structural changes and external business or political changes.

Comparing your current supply to this revised demand will show surpluses and shortages

which will allow you to take corrective action such as:

recruiting to meet a shortage of those with senior management potential

allowing faster promotion to fill immediate gaps

developing cross functional transfers for high fliers

hiring on fixed-term contracts to meet short-term skills/experience deficits

Reducing staff numbers to remove blockages or forthcoming surpluses.

Thus appropriate recruitment, deployment and severance policies can be pursued to meet

business needs. Otherwise processes are likely to be haphazard and inconsistent. The wrong

sort of staff is engaged at the wrong time on the wrong contract. It is expensive and

embarrassing to put such matters right.

HR Planning Application:

The report details the sort of approach companies might wish to take. Most organizations

are likely to want HRP systems:

which are responsive to change

where assumptions can easily be modified

that recognize organizational fluidity around skills

that allow flexibility in supply to be included

that are simple to understand and use

which are not too time demanding.

To operate such systems organizations need:

appropriate demand models

good monitoring and corrective action processes

comprehensive data about current employees and the external labor market

an understanding how resource works in the organization.

If HRP techniques are ignored, decisions will still be taken, but without the benefit of

understanding their implications. Graduate recruitment numbers will be set in ignorance of

demand, or management succession problems will develop unnoticed. It is surely better if

decision makers follow this maxim in the way they make and execute resource plans.

HR Planning Process

The planning processes of most best practice organizations not only define what will be

accomplished within a given timeframe, but also the numbers and types of human

resources that will be needed to achieve the defined business goals number of human

resources; the required competencies; when the resources will be needed; etc.

Competency-based management supports the integration of human resources planning

with business planning by allowing organizations to assess the current human resource

capacity based on their competencies against the capacity needed to achieve the vision,

mission and business goals of the organization. Targeted human resource strategies, plans

and programs to address gaps hiring / staffing; learning; career development; succession

management; etc. are then designed, developed and implemented to close the gaps.

These strategies and programs are monitored and evaluated on a regular basis to ensure

that they are moving the organizations in the desired direction, including closing employee

competency gaps, and corrections are made as needed. This Strategic HR Planning and

evaluation cycle is depicted in the diagram below.

Implementation Stages

The following implementation stages are suggested for mid to large organizations

implementing competencies in support of Strategic Human Resources Planning.

Stage 1

Establish a Competency Architecture and Competency Dictionary that will support

Strategic Human Resource Planning.

For each group to be profiled, define the roles and career streams to help identify

current and future human resources needs.

Determine how competencies will be integrated with the existing HR Planning

process and systems (e.g., Human Resource Information Management systems;

other computer-based tools, for example forecasting models).

Stage 2

Build or revamp HR Planning tools, templates and processes to incorporate elements

as determined in Stage 1.

Train managers and / or facilitate corporate HR Planning process.

Continuously monitor and improve processes, tools and systems to support HR

Planning

Overarching Policy, Process & Tools

Common Competency Dictionary and Architecture

Establishing a common Competency Dictionary and Architecture is fundamental for the

successful implementation of competencies throughout the organization. Maintaining this

common architecture is essential for ensuring that all human resource management

applications are fully integrated and that maximum efficiencies can be gained. It is

important, therefore, to identify an organizational group accountable for the maintenance

of the Competency Dictionary and Architecture on an ongoing basis.

Human Resource Information Management Infrastructure

In a recent review, the CBM talent management initiatives have not necessarily yielded the

desired benefits and return on investment, for the main part because organizations have

not invested in the talent management software systems and infrastructure to facilitate full

and effective implementation. To gain maximum benefit from CBM, organizations need to

have a human resources management system and on-line tools and processes that will

support many of the implementation recommendations contained in this document.

Governance / Accountability Structure

Organizations that have effectively implemented competencies on a corporate-wide basis

have ensured that there is an appropriate project management, governance and

accountability framework in place to support the development, maintenance and revision /

updating of the competency profiles to meet changing demands.

Process Implementation Stages

The following implementation stages are suggested for mid to large organizations.

Stage 1

Establish a Common Competency Dictionary and Architecture to support

competency profiling within the organization.

Ensure that the internal (and external, if needed, such as consulting expertise)

project resources and framework are in place to support the development of

competencies and their implementation in the planned applications. (This is critical

to the successful implementation of CBM.).

Review and establish the governance structure and accountabilities for

implementing and maintaining CBM within the organization.

Communicate the importance and the benefits of competency-based management

for employees, managers and the organization regularly and widely.

Identify the infrastructure and system requirements to support full implementation

(e.g., Human Resources Information Management System; other on-line software

tools needed to support various CBM applications).

Develop the competency profiles.

Implement the competency profiles in a staged-way to demonstrate benefits and

create buy-in (e.g., as soon as profiles for a group are developed, implement quickly

within a low-risk high-benefit planned application for the group).

Communicate success stories as competency profiles are implemented.

Stage 2

Develop, revise / update competency profiles to meet changing demands.

Monitor and evaluate applications to ensure that they are meeting organizational

needs, and adjust programs / plans, as needed, to meet evolving needs.

LONG-TERM PLANNING for SHORT-TERM SUCCESS:

Often, however, operating pressures move all of the planning from a longer-term focus to a

short-term one. That normally tends to create an environment within which the plan cannot

be fully successful. “Over-reliance on short-term planning can be quite costly. Ample lead

time is required to recruit or develop talented personnel, and reaction management that

responds to short term events or needs will usually limit the choices of options or endanger

longer-range economic plans.”

As most planning models would indicate, the planning processes need to be circular and

connected dynamically. “The link between human resource planning and business strategic

planning is vital if personnel programs and systems are to be attuned to the changing needs

of an organization.”

The relationship between short and long-term planning goals and activities are shown in

Figure B. This is a dynamic model. If you consider each of the four boxes as analogous to the

legs of a four-legged stool, you can see the impact of removing one leg of the process. The

impact of not doing long-term human resources planning is to cause the overall business

plan to be limited to current human resources in trying to accomplish the plan. To achieve

most long-term business plans requires some change in human resources from current state

to the necessary state. The business goals achieved are often less that those possible with

successfully implemented human resource plans.

WORKFORCE PLANNING:

In exploring the strategic human resource issues, a basic step is to determine if the

organization has the ability to execute its strategies.

Workforce inventory and planning is an integral part of human resources planning. It is

where the greatest amount of energy is usually spent because it is the most quantitative

part of the planning activity. People who view workforce planning as being the total work of

HRP define human resources planning as “planning for the corporation so as to have the

right numbers of people at the right time, at the right place and with the right skill.”

Necessary to any business success are strategies, components, and tool development.

Workforce planning strategies that are necessary to success are: to become a part of the

business and operations planning teams; and to automate the collection, processing and

analysis of quantitative data. It is apparent that any attempt at having the line management

do useful and credible workforce planning is dependent upon that availability and use of

automated capabilities that remove the “numbers crunching” aspect of the exercise and

allow the manager to concentrate on the qualitative and forecasting part of the plan. “The

two essential building blocks for human resource planning are: a comprehensive human

resource information system; and a basic business plan.” See Figure C for a snapshot picture

of the integrated workforce planning process. Note that every aspect of the model is

interdependent with every other aspect. The workforce planning components that make up

the plan include a workforce forecast / business plan, current workforce inventory and

adjustments, and workforce change needs. The forecast / business plan is a listing of all

labor required to meet business plans. It is usually forecasted by fiscal year quarter and by

job classification (long-term goals should be to do forecasts by skill needs instead of job

classifications). The current workforce inventory and adjustments component is a listing of

all employees by labor category, job classification and fiscal year quarter. Anticipated

changes in the population and workforce due to attrition, college hiring, promotions, job

rotation, etc. are accounted for. The workforce change needs component is the part of the

workforce plan that states the differences between employee workforce projections and

planned business workforce needs by group, job classification, fiscal year quarter, etc.

Human resource forecasting involves making projections of both the organization’s

personnel needs and the available supply of qualified and skilled people. To the extent that

these projections of demand and supply are not fully compatible, detailed strategies will

need to be developed to fill whatever gaps may exist.”

A workforce planning tools development program is usually necessary even in the most

experienced organizations. It often includes steps such as:

1. Develop a capability for computer based personnel database manipulation and analysis

2. Determine inventory reporting data and format needs of organizations

3. Construct one set of reporting formats for workforce inventory and planning

4. Introduce and modify workforce-planning tools to the line organizations and consult to

organizations on technology, process, tools and quality.

“The more different technical skills there are involved in the design, manufacture,

marketing, and sales of a product, the more vulnerable the organization will be to the

critical process, and the higher the interdependence among the various specialists. The

higher the interdependence, the greater the need for effective integration of all the

specialties because the entire process is only as strong as its weakest link.”

As can be seen in the model and suggested process in Figure C the process is continual and

circular. Almost every aspect of workforce analysis and planning is subject to the change

made in any other aspect. The interdependence of all parts of the process is important; but

the external variables are just as important. Consider, for instance, the impact of something

as unpredictable and simple as a flu epidemic on a workforce plan. The plan will need to

change to reflect increased absenteeism, etc. The driving business plan will probably change

because of the human resource capacity; but even more certainly the people part of the

plan will change.

MANAGEMENT RESOURCES PLANNING:

A good human resource plan will almost always include a management resources plan. The

objective of such a plan is to provide strategies, tools, technology and expertise for the

planning for and development of current and potential management human resources in

order to allow for enhanced management of the business. See FIGURE D for a model of

management resources planning. As Dessler points out: “Management development is

important for several reasons. The main reason is that promotion from within is a major

source of management talent.”

The primary strategy is to acquire and develop tools and resources to meet the long-term

management needs; consult on the development of group and individual strategies and

development. “The call for improved productivity from managerial professional and

technical positions ultimately translates into improved individual performance.”

Very often, specific goals include:

• to develop generic strategies and tools for needs assessment and inventory;

• develop and implement Management Development planning tools;

• identity and integrate Management technology and expertise;

• and to implement and institutionalize Management Development.

Specific program plans may include:

• using workforce planning results for parts of needs assessment;

• fostering integration of consultative expertise in Management theory and practice into

planning efforts;

• consulting with Managers on Management Resources Planning and Development;

• and building a reference capability for management development programs and

resources.

Similarly, management development facilitates organizational continuity by preparing

employees and current managers to smoothly assume higher-level positions.” As figure D

shows, management resources planning is a segment of overall workforce planning;

however, it is generally singled out in the planning models as a separate activity. There are

some excellent reasons for this singular treatment. First of all, a company’s management is

commonly considered an important company resource and asset by itself. As a matter of

fact, when companies are evaluated for mergers or acquisition their management assets are

always an important factor in the decision formula. Second, when developing support for a

plan, it is important to demonstrate that the plan will attend to the vested interests of those

that must approve and support the plan if it is to be successfully implemented. Third, the

overall responsibility for the utilization and contribution of a company’s human resources

belongs to the management resources. Therefore, all of the impact of the human resources

plan is the responsibility of the management.

CONCLUSIONS:

Human resource planning is probably one of the most critical elements in linking the work of

the human resources function to the business goals of the company. “It is important to

recognize that certain aspects of human resource management tend to have potentially

high strategic consequences.”

Especially in the areas of policy development and implementation it is “obvious and difficult

to refute advice that effective human resource policies require human resource planning,

which in turn, requires effective integration with an organization’s strategic planning

process.”

It is evident that human resources planning are becoming more and more important in

business circles. “Because business profits are squeezed by inflation and a weakened

economy, management is also concerned with personnel costs and is seeking to achieve

increased output with the same or fewer staff.”

Productivity concerns and material constraints also add to the emphasis on the ability to

plan and fully utilize all of a company’s resources. The human resources are right on the top

of the list in most enterprises. “The current demands on the world’s material resources and

their spiraling cost are building pressure to increase the productivity of human resource.”

Government at all levels both nationally and internationally (Federal, state, local, etc.) is

interested in how employers treat their employees. They, therefore, add factors that must

be considered in any human resource plan (work and wage laws, labor laws, etc.). “The net

impact of the expanding government intervention has been an increase in the attention

given to human resource planning in all of the problem areas.”

So, while the principles and processes of planning have not changed much, the complexity

and timeliness have. Information technology enables the collection and analysis of more

data than was even dreamed of in the 1980s. The complexity of planning across countries,

cultures, economies, and new technologies is almost infinite. This makes the art, the gut

feeling, the best guess, that much more important. The best that can be accomplished is to

predict the probability of multiple successful solutions.

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