Strategy & Human Resources Planning Ppt

8/3/2019 Strategy & Human Resources Planning Ppt

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STRATEGY & HUMAN RESOURCESPLANNING

By

Group: 2 (FA3)

Chandni Mahajan

Deepraksha

Muntazir Ali Submitted to:

Sanchith Bhadauria Prof. Mita Singh

Sri Harsha Koneru

G.Saravana Mani



STRATEGIC PLANNING & HR

STRATEGIC PLANNING:

Procedures for making decisions aboutthe organization’s long-term goals and

strategies

HUMAN RESOURCE PLANNING:

The process of anticipating andproviding for the movement of people into,within and out of an organization



STRATEGIC PLANNING AND HR PLANNING

Strategic Human Resources Management(SHRM)

The pattern of human resources deployments and

activities that enable an organization to achieve itsstrategic goals

Strategy formulation—providing input as to what is possiblegiven the types and numbers of people available.

Strategy implementation—making primary resourceallocation decisions about structure, processes, and humanresources.



HRP AND STRATEGIC PLANNING

Strategic Analysis

What human resources are needed and what areavailable?

Strategic Formulation

What is required and necessary in support of humanresources?

Strategic Implementation

How will the human resources be allocated?

Human Resources

Planning

Strategic

Planning



LINKING STRATEGIC PLANNING AND HUMAN

RESOURCES



STEP ONE: MISSION, VISION, AND VALUES

Mission The basic purpose of the organization as well as its

scope of operations

Strategic Vision A statement about where the company is going and

what it can become in the future; clarifies the long-term direction of the company and its strategic intent

Core Values The strong and enduring beliefs and principles that

the company uses as a foundation for its decisions



STEP TWO: ENVIRONMENTAL SCANNING

Environmental Scanning

The systematic monitoring of the major externalforces influencing the organization.

1. Economic factors: general and regional conditions

2. Competitive trends: new processes, services, andinnovations

3. Technological changes: robotics and office automation

4. Political and legislative issues: laws and administrativerulings

5. Social concerns: child care and educational priorities

6. Demographic trends: age, composition, and literacy



FIVE FORCES FRAMEWORK



STEP THREE: INTERNAL ANALYSIS

Composition

Culture Competencies

InternalAnalysis



SCANNING THE INTERNAL ENVIRONMENT

Cultural Audits

Audits of the culture and quality of work life in anorganization.

How do employees spend their time?

How do they interact with each other?

Are employees empowered?

What is the predominant leadership style ofmanagers?

How do employees advance within the organization?



COMPETITIVE ADVANTAGE THROUGH PEOPLE

Core Competencies Integrated knowledge sets within an organization

that distinguish it from its competitors and delivervalue to customers.

Sustained competitive advantage throughpeople is achieved if these human resources:1. Are valuable.

2. Are rare and unavailable to competitors.3. Are difficult to imitate.

4. Are organized for synergy.



COMPOSITION: THE HUMAN CAPITAL

ARCHITECTURE

Core knowledge workers

Employees who have firm-specific skills that aredirectly linked to the company’s strategy.

Example: Senior software programmer

Traditional job-based employees

Employees with skills to perform a predefined jobthat are quite valuable to a company, but not unique.

Example: Security guard



COMPOSITION: THE HUMAN CAPITAL

ARCHITECTURE (CONT’D)

Contract labor

Employees whose skills are of less strategic valueand generally available to all firms.

Example: General electrician

Alliance/partners

Individuals and groups with unique skills, but those

skills are not directly related to a company’s corestrategy.

Example: Independent product label designer



MAPPING HUMAN CAPITAL



FORECASTING: A CRITICAL ELEMENT OF PLANNING

Forecasting involves:

a. forecasting the demand for labor

b. forecasting the supply of labor

c. balancing supply and demand considerations.



MODEL OF HR FORECASTING

FORECASTING DEMAND

Considerations

• Product/service demand

• Technology

• Financial resources

• Absenteeism/turnover• Organizational growth

• Management philosophy

Techniques

• Trend analysis

• Managerial estimates

• Delphi technique

Techniques

• Staffing tables

• Markov analysis

• Skills inventories

• Management inventories

• Replacement charts

• Succession planning

External Considerations

• Demographic changes

• Education of the workforce

• Labor mobility

• Government policies

• Unemployment rate

FORECASTING SUPPLY

BALANCINGSUPPLY AND DEMAND

(Shortage)

Recruitment• Full-time

• Part-time

• Recalls

(Surplus)

Reductions• Layoffs

• Terminations

• Demotions

• Retirements



FORECASTING DEMAND FOR EMPLOYEES

Quantitative Methods

Qualitative Methods

Forecasting Demand



QUANTITATIVE APPROACH: TREND ANALYSIS

Forecasting labor demand based on anorganizational index such as sales:

1. Select a business factor that best predicts humanresources needs.

2. Plot the business factor in relation to the number ofemployees to determine the labor productivity ratio.

3. Compute the productivity ratio for the past five years.

4. Calculate human resources demand by multiplyingthe business factor by the productivity ratio.

5. Project human resources demand out to the targetyear(s).



EXAMPLE OF TREND ANALYSIS OF HR DEMAND

2000 $2,351 14.33 164

2001 $2,613 11.12 2352002 $2,935 8.34 352

2003 $3,306 10.02 330

2004 $3,613 11.12 325

2005 $3,748 11.12 337

2006 $3,880 12.52 310

2007* $4,095 12.52 327

2008* $4,283 12.52 342

2009* $4,446 12.52 355

BUSINESS LABOR = HUMAN RESOURCES

FACTOR PRODUCTIVITY DEMANDYEAR (SALES IN THOUSANDS) (SALES/EMPLOYEE) (NUMBER OF EMPLOYEES)



QUALITATIVE APPROACHES

Management Forecasts

The opinions (judgments) of supervisors, departmentmanagers, experts, or others knowledgeable about

the organization’s future employment needs. Delphi Technique

An attempt to decrease the subjectivity of forecastsby soliciting and summarizing the judgments of a

preselected group of individuals.

The final forecast represents a composite group judgment.



FORECASTING THE SUPPLY OF EMPLOYEES: INTERNAL LABOR

SUPPLY

Staffing Tables

Markov Analysis

Skill InventoriesReplacement Charts

Succession Planning



FORECASTING INTERNAL LABOR SUPPLY

Staffing Tables

Graphic representations of all organizational jobs, along with the numbers of employees

currently occupying those jobs and future(monthly or yearly) employment requirements.

Markov Analysis

A method for tracking the pattern of employeemovements through various jobs.

HYPOTHETICAL MARKOV ANALYSIS FOR A



HYPOTHETICAL MARKOV ANALYSIS FOR A

RETAIL COMPANY



INTERNAL DEMAND FORECASTING TOOLS

Skill Inventories Files of personnel education, experience, interests,

skills, etc., that allow managers to quickly match jobopenings with employee backgrounds.

Replacement Charts Listings of current jobholders and persons who are

potential replacements if an opening occurs.

Succession Planning The process of identifying, developing, and tracking

key individuals for executive positions.



AN EXECUTIVE REPLACEMENT CHART



STEP FOUR: FORMULATING STRATEGY

Strategy FormulationMoving from simple analysis to devising a

coherent course of action.

SWOT analysisA comparison of strengths , weaknesses ,opportunities , and threats for strategyformulation purposes.

Use the strengths of the organization tocapitalize on opportunities, counteract threats,and alleviate internal weaknesses.



CORPORATE STRATEGY

Strategic Alliancesand Joint Ventures

Growth andDiversification

Mergers andAcquisitions

CorporateStrategy



BUSINESS STRATEGY

Value Creation What the firm adds to a product or service by virtue

of making it; the amount of benefits provided by theproduct or service once the costs of making it are

subtracted. Low-cost strategy: competing on productivity and

efficiencyKeeping costs low to offer an attractive price to customers

(relative to competitors).

Differentiation strategy: compete on added value Involves providing something unique and distinctive to

customers that they value.



FUNCTIONAL STRATEGY: ENSURING ALIGNMENT

External Fit (or External Alignment)

Focuses on the connection between thebusiness objectives and the major initiatives in

HR. Internal Fit (or Internal Alignment)

Aligning HR practices with one another to

establish a configuration that is mutuallyreinforcing.



THE 7-S MODEL



STEP FIVE: STRATEGY IMPLEMENTATION

Taking Action: Reconciling Supply andDemand

Balancing demand and supply considerations

Forecasting business activities (trends)

Locating applicants

Organizational downsizing

Reducing “headcount” Making layoff decisions

Seniority or performance?

Labor agreements



STEP SIX: EVALUATION AND ASSESSMENT

Evaluation and Assessment Issues

Benchmarking: The process of comparing theorganization’s processes and practices with

those of other companiesHuman capital metrics

Assess aspects of the workforce

HR metricsAssess the performance of the HR function itself



MEASURING STRATEGIC ALIGNMENT

Strategy Mapping and the BalancedScorecard

Balanced Scorecard (BSC)

A measurement framework that helps managerstranslate strategic goals into operational objectives

financial

customer

processes

learning



BALANCED SCORECARD



ASSESSING INTERNAL FIT

ENSURING STRATEGIC FLEXIBILITY FOR THE



ENSURING STRATEGIC FLEXIBILITY FOR THE

FUTURE

Organizational Capability

Capacity of the organization to act and change inpursuit of sustainable competitive advantage.

Coordination flexibility

The ability to rapidly reallocate resources to new orchanging needs.

Resource flexibilityHaving human resources who can do many different

things in different ways.



Documents

Strategy & Human Resources Planning Ppt