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Human Resources/implication on HR Planning

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Question
What are the possible implications a strategy of expansion based on reducing layers of organization hierarchy,increasing span of control and increase the use of automation has has for human resource planning.

Answer
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reducing layers of organization
The logic behind a flat hierarchy says that well-trained workers will be more productive when they are more directly involved in the decision-making process, rather than closely supervised by many layers of management.
The flat organization model promotes employee involvement through a decentralized decision-making process.

A hierarchy can link entities either directly or indirectly, and either vertically or horizontally. The only direct links in a hierarchy, insofar as they are hierarchical, are to one's immediate superior or to one of one's subordinates
 The flat organization model promotes employee involvement through a decentralized decision-making process. By elevating the level of responsibility of baseline employees and eliminating layers of middle management, comments and feedback reach all personnel involved in decisions more quickly. Expected response to customer feedback becomes more rapid. Since the interaction between workers is more frequent, this organizational structure generally depends upon a much more personal relationship between workers and managers. Hence the structure can be more time-consuming to build than a traditional hierarchical model

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span of control
A span of control is the number of people who report to one manager in a hierarchy. The more people under the control of one manager - the wider the span of control. Less means a narrower span of control.
An example of a narrow span of control is shown in the diagram below:

The advantages of a narrow span of control are:
•   A narrow span of control allows a manager to communicate quickly with the employees under them and control them more easily
•   Feedback of ideas from the workers will be more effective
•   It requires a higher level of management skill to control a greater number of employees, so there is less management skill required
An example of a wide span of control is shown in the diagram below:

The advantages of wide span of control are:
•   There are less layers of management to pass a message through, so the message reaches more employees faster
•   It costs less money to run a wider span of control because a business does not need to employ as many managers
The width of the span of control depends on:
The type of product being made – products which are easy to make or deliver will need less supervision and so can have a wider span of control
Skills of managers and workers – a more skilful workforce can operate with a wider span of control because they will need less supervision. A more skilful manager can control a greater number of staff
A tall organisation has a larger number of managers with a narrow span of control whilst a flat organisation has few managers with a wide span of control.
A tall organisation can suffer from having too many managers (a huge expense) and decisions can take a long time to reach the bottom of the hierarchy
BUT, a tall organisation can provide good opportunities for promotion and the manager does not have to spend so much time managing the staff
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increase the use of automation

Effect on skilled labour. Robotic machines can perform certain unpleasant and dangerous jobs, such as welding and painting, that can be injurious to a worker's health. They can handle loads of up to a ton or more and work efficiently in temperatures ranging from near freezing to uncomfortably hot. Automation has eliminated much of the worker's physical and mental drudgery and has allowed the worker to change from a machine operator to a machine supervisor.
At the same time, by increasing productivity as measured in output per man-hour, automation can reduce the number of workers. In the 1950s and '60s employment declined in the chemical, steel, meat-packing, and other industries in developed countries that achieved large increases in output. Except in certain older industrial areas in Britain and the United States, however, the widely feared onset of mass unemployment did not materialize. Although certain jobs and skills have been rendered obsolete, a vast array of new jobs calling for different skills has grown up.
Automation has brought about changes in the worker's relation to the job. Here the differences between labour practices in different countries proves instructive. The old management principle that work should be broken down into the smallest operations, so that the worker would not have to use any intelligence in performing a job, was based perhaps upon the notion that the worker is stupid. Hence, when full mechanization was introduced into American factories, the workers were not permitted to stop the moving assembly line if anything went amiss; that was presumed to be the task of supervisory engineering personnel. The result was both low productivity and a loss in quality control. In Japanese factories, on the other hand, assembly-line workers were allowed to stop the process when something went wrong. Indeed, the Japanese companies formed "quality circles," wherein the workers were given a say in the performance of their tasks and in the process of problem solving--an application of Mayo's Hawthorne effect, which they had learned from American management consultants. These practices improved both productivity and quality.
A similar way of enhancing quality and work performance is what is known as group assembly, which started in Swedish automobile plants and was also adopted by the Japanese and then by the Americans. With this system a group of workers is responsible for the entire product, rather than individual workers doing only one small task. If something goes wrong on an assembly line, an individual worker can push a button and hold things in place until the problem is resolved. This approach to production is being increasingly employed throughout the world. It already has had major implications for the labour force and labour-management relations. For one thing, it allows smaller numbers of more highly skilled workers, operating sophisticated computer-controlled equipment, to replace thousands of unskilled workers in assembly-line plants.
As a consequence, the highly skilled worker, who began to disappear with the introduction of the old-fashioned mass production assembly line, again became indispensable. The increasing use of automated machinery and control systems placed new demands on both the technical skills and the intellectual aptitudes of production workers. While automation may have eliminated many unskilled jobs, it increased the demand for highly skilled mechanical labourers and knowledgeable technicians who could operate the newer automated devices. As a result, the early prophecies that automation would reduce the need for workers' skills have proved to be the contrary of what has been happening. Automation may be seen as improving efficiency and expanding production while relieving drudgery and increasing earnings--precisely the aims of Frederick W. Taylor at the turn of the 20th century.
The office workplace. The introduction of computers also affected the organization of work in the information sector of the production economy. File clerks, bookkeepers, and other skilled office personnel involved in information processing were replaced by semiskilled keypunch and tabulating-machine operators. Office automation represents a further mechanization of office work, a process that began with the typewriter and the adding machine in the 19th century.
The information flow in offices has been likened to the movement of materials in manufacturing. Information, like materials, must be stored; typing or keypunching changes the form of the information, just as a machine operation changes the form of the workpiece; the value of the finished product is changed by adding information to it; and there must be a measure of quality control to make certain that the information is accurate. Just as automated machinery has done away with the jobs of many machine operators, integrated information-processing systems have eliminated many clerical tasks. For the production operation, automation provides an exact control over the inventory of raw materials, parts, and finished goods. Applied to billing operations in the office, it often can drastically reduce accounting costs.
The combination of computers and telecommunications led some to believe that office workers would perform their required functions without leaving their homes, as the computer terminal would take the place of their usual paperwork. Such predictions generally have not materialized, however. Social psychologists explain this by pointing out the social aspect of the work process, in the office as well as on the assembly line. Office workers have revealed their nature as "social animals" who enjoy the companionship of their fellow employees at the workplace.
Nevertheless, office automation affects management-worker relationships in a number of ways. For middle-level employees it means that higher management can have the reports of production, costs, and inventory at their fingertips and on the computer screens at their desks instead of depending on their subordinates for information. Automation also gives managers the means to monitor the efficiency of office workers in a way hitherto impossible. Through computerized information they can, for example, count the number of times per hour that a typist strikes a letter on the keyboard or ascertain the number, times, and nature of a worker's telephone calls.
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HOW  THREE  FACTORS  AFFECT  HUMAN  RESOURCE  PLANNING  STRATEGICALLY
A comprehensive Human Resource Strategy plays a vital role in the achievement of an organisation's overall strategic objectives and visibly illustrates that the human resources function fully understands and supports the direction in which the organisation is moving. A comprehensive HR Strategy will also support other specific strategic objectives undertaken by the marketing, financial, operational and technology departments.
In essence, an HR strategy should aim to capture "the people element" of what an organisation is hoping to achieve in the medium to long term, ensuring that:-
•   it has the right people in place
•   it has the right mix of skills
•   employees display the right attitudes and behaviours, and
•   employees are developed in the right way.
An HR strategy will add value to the organisation if it:
•   articulates more clearly some of the common themes which lie behind the achievement of other plans and strategies, which have not been fully identified before; and
•   identifies fundamental underlying issues which must be addressed by any organisation or business if its people are to be motivated, committed and operate effectively.
The first of these areas will entail a careful consideration of existing or developing plans and strategies to identify and draw attention to common themes and implications, which have not been made explicit previously.
The second area should be about identifying which of these plans and strategies are so fundamental that there must be clear plans to address them before the organisation can achieve on any of its goals. These are likely to include:
•   workforce planning issues
•   succession planning
•   workforce skills plans
•   employment equity plans
•   empowerment initiatives
•   motivation and fair treatment issues
•   pay levels designed to recruit, retain and motivate people
•   the co-ordination of approaches to pay and grading across the organisation to create alignment and potential unequal pay claims
•   a grading and remuneration system which is seen as fair and giving proper reward for contributions made
•   wider employment issues which impact on staff recruitment, retention, motivation etc.
•   a consistent performance management framework which is designed to meet the needs of all sectors of the organisation including its people
•   career development frameworks which look at development within the organisation at equipping employees with "employability" so that they can cope with increasingly frequent changes in employer and employment patterns
•   policies and frameworks to ensure that people development issues are addressed systematically : competence frameworks, self-managed learning etc.
The HR strategy will need to show that careful planning of the people issues will make it substantially easier for the organisation to achieve its wider strategic and operational goals.
In addition, the HR strategy can add value is by ensuring that, in all its other plans, the organisation takes account of and plans for changes in the wider environment, which are likely to have a major impact on the organisation, such as:
•   changes in the overall employment market - demographic or remuneration levels
•   cultural changes which will impact on future employment patterns
•   changes in the employee relations climate
•   changes in the legal framework surrounding employment
•   HR and employment practice being developed in other organisations, such as new flexible work practices.
2. Making the HR Strategy integral to the organisation
To achieve this objective, practitioners should:-

•   consult all stakeholders on the nature of the strategy;
•   cultivate and develop allies and supporters of the strategy through the consultation process;
•   focus on the benefits which are being derived from the strategy through talking to and persuading others, and by marketing the benefits of the strategy with concrete examples of how it has helped;
•   check that there is real commitment to the strategy at all levels of the organisation;
•   give regular feedback on the implementation of the plan through employee newsletters, exhibitions etc;
•   where possible, build into the strategy quantifiable outcomes which can be easily monitored and evaluated, so that it is possible to show the effect;
•   make the strategy part of the induction process - especially for senior managers.
3. A strategic human resource planning model
There is no single approach to developing a Human Resources Strategy. The specific approach will vary from one organisation to another. Even so, an excellent approach towards an HR Strategic Management System is evident in the model presented below. This approach identifies six specific steps in developing an HR Strategy:-
1.   Setting the strategic direction
2.   Designing the Human Resource Management System
3.   Planning the total workforce
4.   Generating the required human resources
5.   Investing in human resource development and performance
6.   Assessing and sustaining organisational competence and performance



The six broad interconnected components of this system consist of three planning steps and three execution steps.
The top three components represent the need for planning. Organizations must determine their strategic direction and the outcomes they seek. This is usually accomplished with some form of strategic planning. Classic strategic planning is a formal, top-down, staff-driven process. When done well, it is workable at a time when external change occurs at a more measured pace.
However as the pace and magnitude of change increases, the approach to strategic planning changes substantially:
•   First, the planning process is more agile; changes in plans are much more frequent and are often driven by events rather than made on a predetermined time schedule.
•   Second, the planning process is more proactive. Successful organizations no longer simply respond to changes in their environment, they proactively shape their environment to maximize their own effectiveness.
•   Third, the planning process is no longer exclusively top-down; input into the process comes from many different organizational levels and segments. This creates more employee ownership of the plan and capitalises on the fact that often the most valuable business intelligence can come from employees who are at the bottom of the organizational hierarchy.
•   Lastly, the strategic planning process less reactive and more driven by line leadership.
Once strategic planning is under way, a process must be undertaken by the organization to design and align its HRM policies and practices to provide for organizational success. The remaining step in planning is to determine the quality and quantity of human resources the organization needs for its total force.
The rest of the HR strategic system exists for and is guided by these plans, policies, and practices. These execution components contain mechanisms that generate the correct skill sets, invest in staff development and performance, and productively employ them in the organisation. The last component provides a means to assess and sustain the competence and performance of the organization and the people in it with regard to outcomes that the organization seeks.
4. Analysis
Using the process model discussed earlier, the specific components of the HR Strategic Plan are discussed in greater detail below.
4.1 Setting the strategic direction

This process focuses on aligning human resource policies to support the accomplishment of the Company's mission, vision, goals and strategies. The business' goals sit at the heart of any HR strategy and in order to align business and HR you need to answer one key question, "Can your organisation's internal capability deliver the organisation’s business goals?"
Many organisations cite their people as their primary source of competitive advantage. Successful companies continuously identify and adopt innovative human resource management policies and practices to sustain that advantage. More importantly, they structure work and design training, performance management, pay, and reward policies to help members of the organization succeed in achieving desired organizational outcomes. In other words, they integrate and align HRM policies and practices to reinforce employee behaviors that can best realize the leaders' strategic intent. In the most successful companies, the set of policies and practices that collectively make up a company's HRM system is the critical management tool for communicating and reinforcing the leaders' strategic intent.

Recommended actions:-
•   Conduct an external environmental scan and evaluate its impact on the organisation
•   Identify the organisation's vision, mission and guiding principles
•   Identify the mission's outcomes and strategic goals
•   Consult all relevant stakeholders
•   Evaluate the impact of legislation on the organisation
4.2 Designing the Human Resource Management System

This stage focuses on the selection, design and alignment of HRM plans, policies and practices. Various options may be open to the organisation such as drawing on industry best practices.
Emerging HRM policies and practices range from outsourcing certain non-core functions, adopting flexible work practices (telework, work from home) and the increased use of information technology. Not every industry trend may be appropriate for a specific organisation. In addition, it is essential that a cost-benefit analysis of implementing new HRM policies and practices be undertaken. For example, the costs (monetary and in allocation of resources) of implementing a new job grading system may outweigh the benefit of such an undertaking. There may be more cost-effective alternatives available to the organisation at this point in time.
Particular HRM policies and practices may be necessary to support strategic organisational objectives, such as improving the retention of women in the organisation or promoting diversity, especially the representation of designated groups amongst senior management.
A good approach in selecting the appropriate HRM policies, procedures and practices is to identify the appropriate HRM practices which support the organisation's strategic intent as it relates to recruitment, training, career planning and reward management.
Recommended actions:-
•   Identify appropriate human resource plans, policies and practices needed to support organisational objectives
•   Identify relevant human resource best practices
•   Conduct an employment systems review
4.3 Planning the total workforce

Determining future business requirements, especially those relating to manpower requirements, represents one of the most challenging tasks facing human resource practitioners.
The development of a workforce plan is a critical component of any human resource strategy and one of the expected outcomes of human resource practitioners activities. Despite this, manpower or workforce planning, as well as succession planning, has only recently enjoyed a resurgence in popularity. To some extent this has been prompted by the need to develop employment equity and workplace skills plans and set numerical employment equity targets. The failure of many organisations to develop and implement workforce planning is rather indicative of the lack of strategic planning itself.
Workforce planning is a systematic process of identifying the workforce competencies required to meet the company's strategic goals and for developing the strategies to meet these requirements. It is a methodical process that provides managers with a framework for making human resource decisions based on the organization’s mission, strategic plan, budgetary resources, and a set of desired workforce competencies. Workforce planning is a systematic process that is integrated, methodical, and ongoing. It identifies the human capital required to meet organisational goals, which consists of determining the number and skills of the workers required and where and when they will be needed. Finally workforce planning entails developing the strategies to meet these requirements, which involves identifying actions that must be taken to attract (and retain) the number and types of workers the organisation needs.
A workforce plan can be as simple or as complex as the organisational requires. Workforce planning can be conducted for a department, division or for the organisation as a whole. Whatever the level or approach being adopted, it must nevertheless be integrated with broad-based management strategies.
In addition to workforce planning, ensure that organisational structure and jobs ensure the efficient delivery of services and effective management of the organisation as a whole.
Recommended actions:-
•   Determine the appropriate organisational structure to support the strategic objectives
•   Structure jobs (competencies, tasks and activities) around key activities
•   Develop a workforce plan designed to support the organisations strategic objectives
•   Compile workforce profiles, identifying designated groups, an inventory of current workforce competencies, competencies required in the future and identified gaps in competencies

4.4 Generating the required human resources

This process focuses on recruiting, hiring, classifying, training and assigning employees based on the strategic imperatives of the organisation's workforce plan.
A comprehensive workplace skills plan will identify appropriate training priorities based on the organisations workforce needs now and in the future. New recruitment practices may need to be adopted to increase the representation of designated groups, or securing essential skills in the organisation. A comprehensive "learnership strategy" may assist in developing future workforce needs, identified either in terms of the organisations workforce plan or required in terms of industry black economic empowerment charters.
Recommended actions:-
•   Evaluate recruitment and selection practices in light of the organisation’s strategic objectives
•   Develop and implement a comprehensive workplace skills plan (with a thorough training needs analysis)
•   Implement a learnership strategy
•   Adopt or clarify occupational levels and category classifications

4.5 Investing in human resource development and performance

Traditional approaches to career planning, performance appraisals, reward management and employee development must be re-appraised in light of the vision, characteristics and mission outcomes as reflected in the HRM plans, policies, and practices.
Development responses will aim to increase business skills, the application of business skills (sometimes called competencies) and the behavioural elements - all of which contribute to an organisation's effective performance. In many ways, the Skills Development legislation have required organisations to re-engineer their developmental methods and practices. New concepts such as lifelong learning and recognising prior learning should form an integral component of the process of investing in employees.
Clearly, where a workforce planning exercise reveals that there is little projected growth in the workforce or that promotional or career development opportunities are limited, strategies aimed at employee retention will be very different from organisations which are experiencing considerable growth and expansion.
Investment initiatives for the individual, team and organisation are all geared to achieve high levels of organisational performance. It is important that at an individual level, particularly for senior staff, that they feel their development needs are agreed and that they are provided with the skills to do their jobs. At a team level, it defines the individuals' ability to work flexibly with others and align individual and team skills and activities to business goals - all of which ensures that the organisation is equipped to achieve its goals.
Reward strategies aim to align the performance of the organisation with the way it rewards its people, providing the necessary incentives and motivation to staff. Its components can be a combination of base pay, bonuses, profit sharing, share options, and a range of appropriate benefits, usually based on market or competitor norms and the organisation's ability to pay.
Recommended actions:-
Identify appropriate policies, procedures and practices in respect of
•   Career pathing
•   Performance appraisals
•   Employee development and learning
•   Reward Management (compensation and benefits)
•   Promotions and job assignments
•   Separation
4.6 Assessing and sustaining organisational competence and performance

Finally, few organizations effectively measure how well their different inputs affect performance. In particular, no measures may be in place for quantifying the contribution people make to organizational outcomes or, more important, for estimating how changes in policies and practices, systems, or processes will affect that contribution. Implementing clear quantifiable measures, identifying milestones in the achievement of specific organisational goals, and using concepts such as a "balanced scorecard" will articulate the results of the HR Strategic Plan in measurable terms. Regular evaluation of the plan will also assist in fine-tuning the HR strategic plan itself.
Recommended actions:-
•   Evaluate organisation culture and climate
•   Implement succession planning
•   Evaluate HR strategy using quantifiable measures, e.g. balanced scorecard
•   Revise and adapt HR strategy
5. Conclusion
While HR strategies must be developed to support the achievement of the organisation's objectives, it is a two-way process. HR strategies can themselves be critical inputs in determining the strategic initiatives for the organisation. A fatal error, however, is to develop and implement HR strategies without having regard for the goals and objectives which the organisation has explicitly or implicitly identified. A common mistake is the development of workplace skills plans which are not linked to any strategic goals or objectives or which have no affirmative action components.
Similarly, the isolated identification of affirmative action numerical targets without first conducting a workforce and succession planning exercise is in most instances, simply meaningless.


Human Resource Planning
Human Resource Planning is the planning of Human Resources. It is also called manpower planning/ personnel planning/ employment planning. It is only after Human Resource Planning that the Human Resource department can initiate the recruitment and selection process. Therefore Human Resource Planning is a sub-system of organizational planning.
“Human Resource Planning
-is a strategy for the acquisition, utilisation, improvement and preservation of an organisation’s human resource”
- is a process of forecasting an organisation’s future demand for human resource and supply of right type of people in right numbers” –

Human Resource Planning  sets   a  strategic direction.
1.   It is future oriented: – Human Resource Planning is forward-looking. It involves forecasting the manpower needs for a future period so that adequate and timely provisions may be made to meet the needs.
2.   It is a continuous process: – Human Resource Planning is a continuous process because the demand and supply of Human Resource keeps fluctuating throughout the year. Human Resource Planning has to be reviewed according to the needs of the organisation and changing environment.
3.   Integral part of Corporate Planning: – Manpower planning is an integral part of corporate planning because without a corporate plan there can be no manpower planning.
4.   Optimum utilisation of resources: – The basic purpose of Human Resource Planning is to make optimum utilisation of organisation’s current and future human resources.
5.   Both Qualitative and Quantitative aspect: – Human Resource Planning considers both the qualitative and quantitative aspects of Human Resource Management, ‘Quantitative’ meaning the right number of people and ‘Qualitative’ implying the right quality of manpower required in the organisation.
6.   Long term and Short term: – Human Resource Planning is both Long-term and short-term in nature. Just like planning which is long-term and short-term depending on the need of the hour, Human Resource Planning keeps long-term goals and short-term goals in view while predicting and forecasting the demand and supply of Human Resource.
7.   Involves study of manpower requirement: – Human Resource Planning involves the study of manpower availability and the manpower requirement in the organisation.

Human Resource Planning  helps  to set  strategic  objectives  
1.   Optimum utilisation of human resources currently employed in the organisation.
2.   To reduce imbalance in distribution and allocation of manpower in organisation for various activities.
3.   To ensure that the organisation is well-equipped with the required Quantity and Quality of manpower on a sustained basis.
4.   To anticipate the impact of technology on jobs and resources.
5.   To control cost of Human Resources employed, used and maintained in the organisation.
6.   To provide a basis for management development programmes.
7.   To ensure optimum contribution and satisfaction of the personnel with reasonable expenditure.
8.   To recruit and retain human resource of required Quantity and Quality.
Human Resource Planning  helps strategic  management  of  HR  RESOURCES.
1.   Shortage of Skills: – These days we find shortage of skills in people. So it is necessary to plan for such skilled people much in advance than when we actually need them. Non-availability of skilled people when and where they are needed is an important factor which prompts sound Human Resource Planning.
2.   Frequent Labour Turnover: – Human Resource Planning is essential because of frequent labour turnover which is unavoidable by all means. Labour turnover arises because of discharges, marriages, promotion, transfer etc which causes a constant ebb and flow in the workforce in the organisation.
3.   Changing needs of technology: – Due to changes in technology and new techniques of production, existing employees need to be trained or new blood injected into an organisation.
4.   Identify areas of surplus or shortage of personnel: – Manpower planning is needed in order to identify areas with a surplus of personnel or areas in which there is a shortage of personnel. If there is a surplus, it can be re-deployed, or if there is a shortage new employees can be procured.
5.   Changes in organisation design and structure: – Due to changes in organisation structure and design we need to plan the required human resources right from the beginning.
Guidelines for making Human Resource Planning  STRATEGICALLY effective
1.   Adequate information system: – The main problem faced in Human Resource Planning is the lack of information. So an adequate Human resource database should be maintained/developed for better coordinated and more accurate Human Resource Planning.
2.   Participation: – To be successful, Human Resource Planning requires active participation and coordinated efforts on the part of operating executives. Such participation will help to improve understanding of the process and thereby, reduce resistance from the top management.
3.   Adequate organisation: – Human Resource Planning should be properly organised; a separate section or committee may be constituted within the human resource department to provide adequate focus and to coordinate the planning efforts at various levels.
4.   Human Resource Planning should be balanced with corporate planning: – Human resource plans should be balanced with the corporate plans of the enterprise. The methods and techniques used should fit the objectives, strategies and environment of the particular organisation.
5.   Appropriate time horizon: – The period of manpower plans should be appropriate according to the needs and circumstances of the specific enterprise. The size and structure of the enterprise as well as the changing aspirations of the people should be taken into consideration.

FOR EFFECTIVE  STRATEGIC  HUMAN  RESOURCE  PLANNING
Factors  to  consider
External factor:
They are the factors which affect the Human Resource Planning externally. They include:-
1.   Government policies: – Policies of the government like labour policy, industrial policy, policy towards reserving certain jobs for different communities and sons-of-the-soil etc affect Human Resource Planning.
2.   Level of economic development: – Level of economic development determines the level of human resource development in the country and thereby the supply of human resources in the future in the country.
3.   Information Technology: – Information technology brought amazing shifts in the way business operates. These shifts include business process reengineering, enterprise resource planning and Supply Chain Management. These changes brought unprecedented reduction in human resource and increase in software specialists. Example: – Computer-aided design (CAD) and computer-aided technology (CAT) also reduced the existing requirement of human resource.
4.   Level of Technology: – Technology is the application of knowledge to practical tasks which lead to new inventions and discoveries. The invention of the latest technology determines the kind of human resources required.
5.   Business Environment: – Business environment means the internal and external factors influencing the business. Business environmental factors influences the volume of mix of production and thereby the supply of human resources in the future in the country.
6.   International factors: – International factors like the demand and supply of Human resources in various countries also affects Human Resource Planning   .
Internal factors:
1.   Company Strategies: – The organisation’s policies and strategies relating to expansion, diversification etc. determines the human resource demand in terms of Quantity and Quality
2.   Human Resource policies: – Human Resource policies of the company regarding quality of human resources, compensation level, quality of working conditions etc. influence Human Resource Planning.
3.   Job analysis: – Job analysis means detailed study of the job including the skills needed for a particular job. Human Resource Planning is based on job analysis which determines the kind of employees to be procured.
4.   Time Horizon: – Company’s planning differs according to the competitive environment i.e. companies with stable competitive environment can plan for the long run whereas firms without a stable environment can only plan for short term. Therefore, when there are many competitors entering business/ when there is rapid change in social and economic conditions of business/ if there is constant change in demand patterns/ when there exists poor management practice, then short term planning is adopted or vice-versa for long-term planning.
5.   Type and Quality of Information: – Any planning process needs qualitative and accurate information about the organisational structure, capital budget, functional area objectives, level of technology being used, job analysis, recruitment sources, retirement plans, compensation levels of employees etc. Therefore Human Resource Planning is determined on the basis of the type and quality of information.
6.   Company’s production and operational policy: – Company’s policies regarding how much to produce and how much to purchase from outside in order to manufacture the final product influences the number and kind of people required.
7.   Trade Unions: – If the unions declare that they will not work for more than 8 hours a day, it affects the Human Resource Planning. Therefore influence of trade unions regarding the number of working hours per week, recruitment sources etc. Affect Human Resource Planning.
8.   Organisational Growth Cycles: – At starting stage the organisation is small and the need of employees is usually smaller, but when the organisation enters the growth phase more young people need to be hired. Similarly, in the declining/recession/downturn phase Human Resource Planning is done to re-trench the employees.
Process of strategic  Human Resource Planning
1. Analysing the Corporate Level Strategies: – Human Resource Planning should start with analysing corporate level strategies which include expansion, diversification, mergers, acquisitions, reduction in operations, technology to be used, method of production etc. Therefore Human Resource Planning should begin with analysing the corporate plans of the organisation before setting out on fulfilling its tasks.
2. Demand forecasting: – Forecasting the overall human resource requirement in accordance with the organisational plans is one of the key aspects of demand forecasting. Forecasting of quality of human resources like skills, knowledge, values and capabilities needed in addition to quantity of human resources is done through the following methods: -
a. Executive or Managerial Judgement: – Here the managers decide the number of employees in the future. They adopt one of the three approaches mentioned below: -
   Bottom-Up approach: – Here the concerned supervisors send their proposals to the top officials who compare these with the organisational plans, make necessary adjustments and finalise them.
   Top-Down approach: – Here the management prepares the requirements and sends the information downwards to the supervisory –level who finalises the draft and approves it.
   Participative Approach: – Here the supervisors and the management sit together and projections are made after joint consultations.
Drawbacks
   The chief drawback of these methods is that estimation of manpower is made using guesswork.
b. Statistical Techniques: – These methods use statistical methods and mathematical techniques to forecast and predict the supply and demand of Human Resources in the future.
   Ratio-Trend analysis: – In this method depending on the past data regarding number of employees in each department, like production department, sales department, marketing department and workload level, etc ratios for manpower are estimated. Past values are plotted and extrapolated to get fairly accurate future projections.
c. Work Study method: – This technique is suitable to study the correlation between volume of work and labour i.e. demand for human resources is estimated based on the workload. Work study method is more appropriate for repetitive and manual jobs when it is possible to measure work and set standards.
d. Delphi Technique: – ‘Delphi’ Technique is named after the Greek Oracle at the city of Delphi. In this method, the views of different experts related to the industry are taken into consideration and then a consensus about the Human Resource requirement is arrived at. Delphi technique is used primarily to assess long-term needs of human resource.
3. Analysing Human Resource Supply: – Every organisation has two sources of supply of Human Resources: Internal & External. Internally, human resources can be obtained for certain posts through promotions and transfers. In order to judge the internal supply of human resources in future human resource inventory or human resource audit is necessary. Human resource inventory helps in determining and evaluating the quantity of internal human resources available. Once the future internal supply is estimated, supply of external human resources is analysed.
4. Estimating manpower gaps: – Manpower gaps can be identified by comparing demand and supply forecasts. Such comparison will reveal either deficit or surplus of Human Resources in the future. Deficit suggests the number of persons to be recruited from outside, whereas surplus implies redundant employees to be re-deployed or terminated. Employees estimated to be deficient can be trained while employees with higher, better skills may be given more enriched jobs.
5. Action Planning: – Once the manpower gaps are identified, plans are prepared to bridge these gaps. Plans to meet the surplus manpower may be redeployment in other departments and retrenchment. People may be persuaded to quit voluntarily through a golden handshake. Deficit can be met through recruitment, selection, transfer and promotion. In view of shortage of certain skilled employees, the organisation has to take care not only of recruitment but also retention of existing employees. Hence, the organisation has to plan for retaining of existing employees.
6. Modify the Organisational plans: – If future supply of human resources form all the external sources is estimated to be inadequate or less than the requirement, the manpower planner has to suggest to the management regarding the alterations or modifications in the organisational plans.
7. Controlling and Review: – After the action plans are implemented, human resource structure and the processes should be controlled and reviewed with a view to keep them in accordance with action plans
Human resources planning like production planning, financial planning an marketing planning, should be an unified, comprehensive and integrated part of the total corporation. Human resource manager provides inputs like key HR areas, HR environmental constraints and internal HR capabilities and HR capability constraints to the corporate strategists .The corporate strategists in turn communicate their needs and constraints to the HR manager. The corporate strategic plan and Hr plan ,thus incorporates both HR and other functional plans.

Corporations formulates plans to fit four times spans:

1. Strategic plans that establish company’s vision, mission and major long range objectives. The time span for strategic plans is usually considered to be five or more years.
2. Intermediate –range plans covering about a three year period .These are more specific plans in support of strategic plan.
3. Operating plans cover about one year. Plans are prepared month by month in sufficient detail for profit , human resources, budget and cost control.
4. Activity plans are the day-by-day and week-by-week plans These plans may not be documented .


Strategic Plan vis-à-vis Human Resource Plan:

Corporate –Level Plan


Top managements formulates corporate-level plan based on corporate philosophy ,policy, vision and mission .The HRM role is to raise the broad and policy issues relating to human resources .The HR issues are related to employment policy, HRD policies, remuneration policies etc .The HR department prepares HR strategies ,objectives and policies consistent with company strategy.


Intermediate –Level Plan

Large-scale and diversified companies organize Strategic Business Units (SBU) for the related activities .SBUs prepare intermediate plans and implement them .HR managers prepare specific plans for acquiring future managers, key personnel and total number of employees in support of company requirements over the next three years.

Operations Plan

Operations plans are prepared at the lowest business profit centre level. these plans are supported by the HR Plans relating to recruitment of skilled personnel ,developing compensation structure, designing new jobs, developing ,leadership improving work life etc.
Short-term Activities Plan:

Day-to-day business plans are formulated by the lowest level strategists .Day-to-day HR plans relating to handling employee benefits ,grievances ,disciplinary cases, accident reports etc. are formulated by the HR managers.
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These  include

-Recruitment/ Selection  PLAN
-Induction / Orientation PLAN
-Training  / Developement  PLAN
-Compensation  PLAN
-Salary  administration  PLAN
-Payroll  Administration  PLAN
-Performance  Appraisal  PLAN
-Performance  Management  PLAN
-Industrial  Relations  PLAN
-Promotions  PLAN [ IF  ANY ]
-Terminations  PLAN
-Transfers  PLAN
-Staff  amenities. PLAN
-retraining  plan
-early retirement  plan
-redundancy  plan
-changes in  workforce utilization  plan
-career  path  plan
-succession  plan.
-personnel  and  career  plans
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===========================================
LASTLY   BASED  ON THE  ABOVE  PLANS,
YOU  DEVELOP  HR  BUDGET.


The elements  in  HR  department  budget  would  vary  with
-company  policy
-budget  process
-company  accounting  system
-nature of  the business operation
-HR  PLANNING
etc

HERE  is  a  broad  set  of   guidelines.

-recruitment/ selection [ internal/ outsourcing ]
-PLACEMENT contractors [external ]
-salary/ wages
-training/ development [ includes  induction/ orientation]
-staff benefits
-staff  amenities
-workplace  facilities
-workplace safety [ OHS]
-salary  contingency
-workers  compensation
-staff  communication [ includes newsletter/ intranet ]
-labor relations [ legal/ investigations]
-HR administration
-HR travels
etc etc.
======================================================
These   plans  will  help  to  bring  supply  and  demand  into  equilibrium,
not  just  as  a  one-off   but  as a  continual workforce  planning
exercise  the  inputs  to  which  will need  constant  varying  to reflect
the  actual  as  against  predicted  experience  on the  supply  side
and  changes in  production actually  achieved as  against  forecast
on the  demand  side.
====================================================================

Problems with Human Resource Planning
1.   Resistance by Employers: – Many employers resist Human Resource Planning as they think that it increases the cost of manpower for the management. Further, employers feel that Human Resource Planning is not necessary as candidates will be available as and when required in the country due to the growing unemployment situation.

2.   Resistance by Employees: – Employees resist Human Resource Planning as it increases the workload on the employees and prepares programmes for securing human resources mostly from outside.
3.   Inadequacies in quality of information: – Reliable information about the economy, other industries, labour markets, trends in human resources etc are not easily available. This leads to problems while planning for human resources in the organisation.

4.   Uncertainties: – Uncertainties are quite common in human resource practices due to absenteeism, seasonal unemployment, labour turnover etc. Further, the uncertainties in the industrial scenario like technological changes and marketing conditions also cause imperfection in Human Resource Planning. It is the uncertainties that make Human Resource Planning less reliable.

5.   Time and expense: – Human Resource Planning is a time-consuming and expensive exercise. A good deal of time and cost are involved in data collection and forecasting.

Guidelines for making Human Resource Planning effective
1.   Adequate information system: – The main problem faced in Human Resource Planning is the lack of information. So an adequate Human resource database should be maintained/developed for better coordinated and more accurate Human Resource Planning.
2.   Participation: – To be successful, Human Resource Planning requires active participation and coordinated efforts on the part of operating executives. Such participation will help to improve understanding of the process and thereby, reduce resistance from the top management.
3.   Adequate organisation: – Human Resource Planning should be properly organised; a separate section or committee may be constituted within the human resource department to provide adequate focus and to coordinate the planning efforts at various levels.
4.   Human Resource Planning should be balanced with corporate planning: – Human resource plans should be balanced with the corporate plans of the enterprise. The methods and techniques used should fit the objectives, strategies and environment of the particular organisation.
5.   Appropriate time horizon: – The period of manpower plans should be appropriate according to the needs and circumstances of the specific enterprise. The size and structure of the enterprise as well as the changing aspirations of the people should be taken into consideration.
Factors affecting Human Resource Plans
External factor:
They are the factors which affect the Human Resource Planning externally. They include:-
1.   Government policies: – Policies of the government like labour policy, industrial policy, policy towards reserving certain jobs for different communities and sons-of-the-soil etc affect Human Resource Planning.
2.   Level of economic development: – Level of economic development determines the level of human resource development in the country and thereby the supply of human resources in the future in the country.
3.   Information Technology: – Information technology brought amazing shifts in the way business operates. These shifts include business process reengineering, enterprise resource planning and Supply Chain Management. These changes brought unprecedented reduction in human resource and increase in software specialists. Example: – Computer-aided design (CAD) and computer-aided technology (CAT) also reduced the existing requirement of human resource.
4.   Level of Technology: – Technology is the application of knowledge to practical tasks which lead to new inventions and discoveries. The invention of the latest technology determines the kind of human resources required.
5.   Business Environment: – Business environment means the internal and external factors influencing the business. Business environmental factors influences the volume of mix of production and thereby the supply of human resources in the future in the country.
6.   International factors: – International factors like the demand and supply of Human resources in various countries also affects Human Resource Planning   .
Internal factors:
1.   Company Strategies: – The organisation’s policies and strategies relating to expansion, diversification etc. determines the human resource demand in terms of Quantity and Quality
2.   Human Resource policies: – Human Resource policies of the company regarding quality of human resources, compensation level, quality of working conditions etc. influence Human Resource Planning.
3.   Job analysis: – Job analysis means detailed study of the job including the skills needed for a particular job. Human Resource Planning is based on job analysis which determines the kind of employees to be procured.
4.   Time Horizon: – Company’s planning differs according to the competitive environment i.e. companies with stable competitive environment can plan for the long run whereas firms without a stable environment can only plan for short term. Therefore, when there are many competitors entering business/ when there is rapid change in social and economic conditions of business/ if there is constant change in demand patterns/ when there exists poor management practice, then short term planning is adopted or vice-versa for long-term planning.
5.   Type and Quality of Information: – Any planning process needs qualitative and accurate information about the organisational structure, capital budget, functional area objectives, level of technology being used, job analysis, recruitment sources, retirement plans, compensation levels of employees etc. Therefore Human Resource Planning is determined on the basis of the type and quality of information.
6.   Company’s production and operational policy: – Company’s policies regarding how much to produce and how much to purchase from outside in order to manufacture the final product influences the number and kind of people required.
7.   Trade Unions: – If the unions declare that they will not work for more than 8 hours a day, it affects the Human Resource Planning. Therefore influence of trade unions regarding the number of working hours per week, recruitment sources etc. Affect Human Resource Planning.
8.   Organisational Growth Cycles: – At starting stage the organisation is small and the need of employees is usually smaller, but when the organisation enters the growth phase more young people need to be hired. Similarly, in the declining/recession/downturn phase Human Resource Planning is done to re-trench the employees.

==================================
1.The  impact  of  technological  change on task needs.
2. Variations in the  efficiency, productivity, flexibility  of  labor  as  a
result  of  training, work study  organizational change, new motivations, etc.

3. Changes  in  employment practices [ e.g. subcontractors  or   outsourcing  etc ]
4.Other  variations due to  new legislations like new health requirements,  safety  requirements etc.

5.Changes  in  government policies   like  tax/ tariff etc
6. Labor  demand  and  supply .

7. Skills   levels   availability
===========================================
##########################################################################33
 THE  HR  PLANNING EMPHASIS  WOULD  BE   ON

1. ideas and practices   that might be considered more widely include:

• initiatives connecting company  and industry policies so that training implications are considered as a matter of course
• initiatives which consider the implications for the company  of the innovations they are supporting , e.g. industry clusters
• initiatives incorporating collaboration across COUNTRY  borders
• efficient use of the worldwide web to disseminate information and collect data
• initiatives which demonstrate learning from previous experience
• attention to resourcing issues
• initiatives which enable company  staff to increase their expertise in new areas
• initiatives which build on established expertise in the  company, and
• initiatives which seek to develop new specialisations in the  company.


2. Technology-related skills
• Skills in identifying new applications of technologies
• Skills in developing new technologies, or advancing existing technologies
• Skills in identifying technological solutions to problems


3. Management skills
• Skills in identifying which innovation outcomes are appropriate for commercialisation
• Skills in knowing when and how to market a new product, tool or process (or other innovation outcome) successfully
• Skills in securing intellectual property rights over innovation outcomes
• Skills in setting up efficient manufacturing processes for new products
• Skills in negotiating appropriate training provision with education and training providers


4. Operative/Technical skills
• Skills in operating new tools or equipment, or applying new methods/processes
• Skills in applying new processes or tools to existing work
• Skills in installing and maintaining new products, and
• Skills in manufacturing new products.

If new and changed skill needs are to be met, access to appropriate education and training is essential. Access must also be provided in a timely fashion so that the skills required for an innovation to be implemented effectively are available when needed. An enterprise will not gain the benefits from installing new equipment if its workers do not have the skills to operate it properly. Finding or providing the right training, in time, can present a challenge. The difficulties some employers are facing in finding effective ways of keeping workers up to date with technological changes – especially the ‘convergence of technologies’


It is  useful  if   the  HRM   SYSTEM   adopt an Innovation  Policy aimed at driving innovation by:
Building an educated and highly skilled workforce.
Becoming a leader in knowledge creation and innovation.
Developing linkages, clusters and networks to become a more integrated and networked local economy.
Fostering high levels of enterprise formation and business growth.
Becoming a globally focused and internationally integrated economy.
Creating a business environment and infrastructure base that facilitates business success.
establishing a culture of innovations. Based on these building blocks it provides support for a range of initiatives under the headings:
Co-operative Research Centres
Knowledge and Technology Diffusion
Technology, Research Parks and Precincts
Education
Commercialisation
Awareness and Promotion         
=========================================================
###############################################################

3.MOBILE  CULTURE

- Communicate  to all locations about a common
corporate culture.
- Allow   local cultures to maintain their identity
in the context of the corporate culture.
- Establish   common systems (e.g., accounting,
marketing, MIS).
- Provide   management with education outlining
how the company does business.
- Create  an organizational mission with input
from all locations.
- Create a written strategy outlining the
corporate culture.
----------------------------------------------------
4.NEW   TECHNOLOGY  IMPACT  ON  SKILLS REQUIREMENTS

Technology-related skills
• Skills in identifying new applications of technologies
• Skills in developing new technologies, or advancing existing technologies
• Skills in identifying technological solutions to problems

Operative/Technical skills
• Skills in operating new tools or equipment, or applying new methods/processes
• Skills in applying new processes or tools to existing work
• Skills in installing and maintaining new products, and
• Skills in manufacturing new products.

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5.BUSINESS  INNOVATION  DEMAND  ON  MANAGMENT

Management skills
• Skills in identifying which innovation outcomes are appropriate for commercialisation
• Skills in knowing when and how to market a new product, tool or process (or other innovation outcome) successfully
• Skills in securing intellectual property rights over innovation outcomes
• Skills in setting up efficient manufacturing processes for new products
• Skills in negotiating appropriate training provision with education and training providers
----------------------------------------------------------------------------------
6.DEMAND  FOR  INNOVATION   THROUGH   TRAINING/DEVELOPMENT :
*Building an educated and highly skilled workforce.
*Becoming a leader in knowledge creation and innovation.
*Developing linkages, clusters and networks to become a more integrated and networked local economy.
*Fostering high levels of enterprise formation and business growth.
*Becoming a globally focused and internationally integrated economy.
*Creating a business environment and infrastructure base that facilitates business success.
establishing a culture of innovations  THRU
#Co-operative Research Centres
#Knowledge and Technology Diffusion
#Technology, Research Parks and Precincts
#Education
#Commercialisation
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7.IT  TECHNOLOGY  DEVELOPMENT.
-more  systems / more  software  for  the  business  means
different  methods  of  working, which  affect  the  working  human resources.
HRM have  to  face / meet/  manage  the  human  resources  to deliver  the  results.
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8.OUTSOURCING   OPPORTUNITIES
-the  demand  for  cheaper labor  forced  the  companies  to
seek  more  destinations  in the underdeveloped countries.
This  created  an  enormous  challenge  to  the  HRM
to seek/develop/manage  overseas  HR.
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#################################

Human Resources

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Leo Lingham

Expertise

human resource management, human resource planning, strategic planning in resource, management development, training, business coaching, management training, coaching, counseling, recruitment, selection, performance management.

Experience

18 years of managerial working exercise which covers business planning , strategic planning, marketing, sales management,
management service, organization development

PLUS

24 years of management consulting which includes business planning, corporate planning, strategic planning, business development, product management, human resource management/ development,training,
business coaching, etc

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Principal---BESTBUSICON Pty Ltd

Education/Credentials
MASTERS IN SCIENCE

MASTERS IN BUSINESS ADMINSTRATION

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