Human Resource Planning Systematic Process
Organizational Structure A company’s organizational structure is typically illustrated by its organizational chart. The particular form of structure needed is determined by the needs of the firm. It may be informal and highly changeable in small, uncomplicated businesses. By contrast, large, diverse, and complex organizations usually have a highly formalized structure. But that should not mean the structure is so rigid that it does not change, perhaps even frequently. Newly formed high-tech companies are most likely to restructure or reorganize frequently, but even some of the largest Fortune 500 industrial firms such as General Motors and Chrysler have experienced major reorganizations. Many variations of organizational structures are available for use today. HR should be in a good position to recommend the most effective structure needed by the organization.
information and control Systems Among the information and control systems are reward systems; incentives; objectives-oriented systems; budgets for allocating resources; information systems; and the organization’s rules, policies, and implementations. Certainly, HR should be a valuable asset in developing and working with these systems. A proper mix of information and control systems must be developed to support the implementation of the strategic plan.
Technology the knowledge, tools, and equipment used to accomplish an organization’s assignments comprise its technology. The appropriate level of technology must be found for proper implementation of the strategic plan. Certainly, technology is revolutionizing how organizations operate today. This is definitely the case for HR professionals.
human resources The HR functions must be properly aligned to successfully implement the strategic plan. HR will be central to understanding the future of an asset that is increasingly important to the organization—the intellectual and productive capacity of its workforce. In essence, a proper balance of HR must be developed to support strategy implementation. Once strategic planning has taken place, HR planning may be developed to help implement the strategic plan.
human resource planning human resource planning (workforce planning) is the systematic process of matching the internal and external supply of people with job openings anticipated in the organization over a specific period of time. Workforce planning has evolved from a knee-jerk planning undertaking to a fundamental strategic function. It includes business plan, HR data, and statistical analyses of those data. It is also incorporated into the business and financial planning process, so it provides a foundation for a plan that is aligned with the business strategy. As organizations exited the recent recession, there was evidence that they were becoming more focused on workforce planning. A recent poll found that 53 percent of the respondents conducted, or planned to conduct, a strategic workforce planning assessment to identify skills gaps.6
The HR planning process is illustrated in Figure 4-2. Note that strategic planning precedes HR planning. HR planning has two components: requirements and availability. A requirement forecast involves determining the number, skill, and location of employees the organization will need at future dates to meet its goals.
The determination of whether the firm will be able to secure employees with the necessary skills, and from what sources, is called an availability forecast.
When employee requirements and availability have been analyzed, the firm can determine whether it will have a surplus or shortage of employees. Ways must be found to reduce the number of employees if a surplus is projected. If a worker shortage is forecast, the firm must obtain the proper quantity and quality of workers from outside the organization. In this case, external recruitment and selection are required.
Because conditions in the external and internal environments can change quickly, the HR planning process must be continuous. Changing conditions could affect the entire organization, thereby requiring extensive modification to the forecasts. The recent recession provided a major challenge for some firms as they raced to develop a downsizing strategy. And, as the economy improved, plans were made to increase the size of the workforce.
Explain the human resource planning process.
human resource planning Systematic process of matching the internal and external supply of people with job openings anticipated in the organization over a specified period of time.
requirements forecast Determining the number, skill, and location of employees the organization will need at future dates to meet its goals.
availability forecast Determination of whether the firm will be able to secure employees with the necessary skills, and from what sources.
Chapter 4 • Strategic Planning, human resource Planning, and Job analysis 85
Human Resource Planning
Forecasting Human Resource
Forecasting Human Resource
Restricted Hiring, Reduced Hours,
Early Retirement, Layoffs, Downsizing
Shortage of Workers
Figure 4-2 the human resource Planning Process
H r B l o o p e r s
Workforce Planning at Master Cleaners
If your professor has assigned this, go to mymanagementlab.com to complete the HR Bloopers exercise and test your application of these concepts when faced with real-world decisions.
Master Cleaners provides residential cleaning services through more than 100 cleaning employees throughout their geographic area. As the HR manager hired just more than a year ago, Jack Potts has worked hard to establish many of their HR prac- tices. As the company’s first HR manager, Jack believes his primary responsibility is to make sure administrative processes are in place. He has been attending senior leadership meetings regarding the orga- nization’s strategy and knows there are some plans to expand into the commercial market. However, he hasn’t paid much attention to those discussions because there is just too much work to do to get HR processes established. Now he’s received a request from one of the cleaning managers about hiring 25 new commercial cleaners and he’s
worried about finding these new hires. The problem is that because the commercial cleaners must work at night after the office buildings are closed for the day, his current recruiting strategy won’t necessarily work. Jack now must find experienced cleaners willing to work in the evening and that is a challenging task. Further, turnover is already high in the residential cleaning business. Exit interviews with employees who have quit suggest that they find the work tedious. Jack expresses his concerns about these staffing challenges to the cleaning manager. But the cleaning manager reminds him they have been talking about this expansion for a while and suggests that Jack should have been planning for this.
86 Part 2 • Staffing