Topics to be covered

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MP Business Requirements Manpower Demand Forecast

Learning Outcome ` To be able to forecast manpower requirement for an organization in coordination with the various departments

Manpower Planning is also called as Human Resource Planning MPP/HRP is the process of determining human resource requirements and the means of meeting those requirements in order to carry out the integrated plan of the Organization

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It is a futuristic assessment
HRP is a forward looking function as human resource estimates are made well in advance.

It assesses the HR requirements in advance keeping in mind the business growth/ objectives, production schedules and demand fluctuations It forms an integral part of the overall corporate strategy.
It is, of course, subject to revision.

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Forecasting future manpower requirements Preparing an inventory of Present manpower Anticipating problems of manpower Meeting manpower requirements

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Forecast personnel requirements Manage Change effectively Realize Organizational goals Use existing manpower productively Promote employees in a systematic way

Organizations use HRP to meet future challenges, cut costs, and achieve greater effectiveness

Create a talent pool Prepare people for future Cope with organisational changes Cut costs Help succession planning

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Linking Organizational strategy to Employment Planning Demand Forecasting Supply Forecasting Manpower Gap analysis Manpower budgeting

Linking Organizational strategy to Employment Planning

Vision, external factors, internal supply analysis Business growth Operational planning availability of resources, plans for M&A, budgets etc. Availability of skilled manpower, competing employers, Technology upgradations etc.

Demand Forecasting
Bottom Up Technique Delphi Technique Nominal group Technique Ratio Analysis Simple Linear Regression analysis Multiple Linear Regression analysis Stochastic method

All the techniques of demand forecasting are divided into four forecast techniques
Expert Forecast Trend analysis Workforce analysis Workload analysis

Expert Forecasts: These are based on the judgements of those who possess good knowledge of future human resource needs Trend Analysis: This is based on the assumption that the future is an extrapolation from the past. Human resource needs, as such, can be estimated by examining pas trends.

An example of trend analysis

2001-02 2002-03 Production of Units No. of Workers Ratio 2003-04 Estimated Production No. of Workers required : : : : : 5,000 100 100:5000 8,000 8000 = 160

If supervisors have a span of 20 workers, 8 supervisors are also needed in 2003-04.

Workforce Analysis: All relevant factors in planning manpower flows in a firm such as transfers, promotions, new recruitments, retirement, resignation, dismissal etc are taken into account while estimating HR needs
romotions out Transfers In > > > > > Recruits In > > > > romotions In > > > Jo Hopping Transfers Retirement VR cheme ( olden handshake) ismissal ischarge or T erminations Resignations Retrenchment Attractions in ther anks, etc ut

Workload analysis: Based on the planned output, a firm tires to calculate the number of persons required for various jobs. An example of workload analysis
Planned output for the year Standard hours per piece Planned hours required Productive hours per person per year (allowing for absenteeism, turnover, idle time etc.) No. of workers required 30 10,000 pieces 3 hours 30,000 hours 1,000 hours (estimated on annual basis)

If span of control in the unit is 10 per officer, then 3 officers are also required.

Supply Forecast
Internal Manpower Supply External manpower Supply

Internal MP supply: a manpower inventory in terms of the size and quality of personnel available (their age, sex, education, training, experience, job performance, etc) is usually prepared by HR departments. Several techniques are used while ascertaining the internal supply of manpower (a supply of employees to fill projected vacancies can come from within the firm or from new hires )

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Estimated internal supply for a given firm

ou ces o n lo s The i m Projected Outflows   Trans ers    romotions e ecruits mployees n Current Staffing Le el mployees ut    etirements eaths Layoffs romotions

 Quits  T erminations

ecalls

Current staffing le el

rojected outflows this year

Projected inflows this year

Firms internal supply for this time ne t year

Human Resource Planning

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Supply Forecasting
Staffing table: Shows the number of employees in each job, how they are utilised and the future employment needs for each type of job. Marcov analysis: Uses historical information from personnel movements of the internal labour supply to predict what will happen in the future

Human Resource Planning

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Marcov analysis for a hypothetical retail company

2003-2004 St re Managers (n = 1 ) Asst. St re Managers (n = 36) Secti n Heads (n = 94) epartmental Heads (n = 288) Sales E ecuti es (n = 1440) F recasted Supply
Fi r s i circl s s

S tore Managers
0% 12 1 1% 4

Asst. S tore Managers

S e ction eads

D e pt. eds

Sales E ecuti es

E it

20% 3 3% 30 1 1% 1 1 66% 63 8% 8 1 % 14 6% 2

10% 29

72% 207 6% 86

2% 6 74% 1066

16% 46 20% 288

16
the tr siti

41
percentages

92

301

1072

3 3

Human Resource Planning

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Supply Forecasting
Skills inventory: It is a summary of the skills and abilities of non managerial employees used in forecasting supply.

Human Resource Planning

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Skills inventory: an example

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Nu ber : 429 ords ctivi y upervision and ana ysis upervision Ana ysis 3 ro 1998 o

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Work experience

ax c erk Accountant Chief Accounts Officer

AB Co pany XYZ Co. Bank

pecia Year 1998 1995 Course DB

ua ifications Date 1996 1999 Location choice Kolkata Delhi Bangalore HR Depar

be rsh ips

a or inance Accounts

1. AIMA . IS D 3. ICA Hobbies

Risk Manage ent osi ion preference Accounting Audi ing

Languages

T y a Banking Soft are

rench

Chess oo ball Boating ent________

ployees Signature __________ Date _______________________

Date ________________

Human Resource Planning

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Supply Forecasting
Replacement chart: It is a visual representation of who will replace whom in the event of a job opening.

Human Resource Planning

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Replacement chart
Gene al anage V. K. Garg A 2 P A to General anager L. athews B1 Assistant General R.K. Arora B.K. Nehru anager A2 B3 Key Names given are replacement candidates A. Promo able now B. Needing developmen C. No sui able to position 1. Superior performance 2. Above Average performance 3. Acceptable performance 4. Poor performance

Division HR anager C.P Thakur . A1

Division Accounting & T axation anager A.T Roy . C2 Central Region anager S.P Kumar A 1 . R. Pandey B3

Division Planning anager A.N. Gupta A 1 K.P Rao . B1

T echnical Advisor N.R. urthy B3

Northern Region anager L.C. Srivatsav A 2 A. Thapar C4

Southern Region anager A. Subramanyam B 2 B1 B.K. enon

Eastern Region anager R. Krishna B 3

Human Resource Planning

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Supply Forecasting
B) External MP supply: External hires need to be contacted when suitable internal replacements are not available. A growing number of firms are now using computerized human resource information systems to track the qualifications of hundreds or thousands of employees. HRIS can provide managers with a listing of candidates with required qualifications after scanning the data base.

Human Resource Planning

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This is used to reconcile the forecasts of labour demand and supply. This process identifies potential skill shortages or surpluses of employees, skills and jobs

Estimating manpower requirements

1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. er required at t e eginning f t e ear C anges t requirements f recast during t e ear T tal requirements at t e end f t e ear 1+2) Number available at t e beginning f t e ear Additions transfers, romotions) Separations retirement, wastage, promotions out and ot er losses) Total available at t e end of ear 4+5+6) Deficit or surplus 3-7) Losses of t ose recruited during t e ear Additional numbers needed during t e ear 8+9) Year 2 3

DEMAND ------------SUPPLY -------------------RECONCILIA TION OF T E ABOVE MANPOWER NEEDED

Human Resource Planning

Salary structuring/restructuring based on

Salary cost of existing manpower Compensation benchmarking surveys Competitors salary data

Cost of recruitment

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Formulating HR Plans
Once supply and demand for labour is known adjustments can be made formulating requisite HR plans

A variety of HR plans
 Recruitment plan  Redeployment plan  Redundancy plan  Training plan  Productivity plan  Retention plan

Human Resource Planning

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Responsibility For Human Resource Planning

HRP is a top management job. HR plans are usually made by the HR division in consultation with other corporate heads. Any deviations from the formulated plans and their causes must be looked into, from time to time in order to assess whether the plans require revision or modification.

Human Resource Planning

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Limitations Of Human Resource Planning

HR professionals are basically confronted with three problems while preparing and administering HR plans: accuracy, inadequate top management support, lopsided focus on quantitative aspects.

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Effective Human Resource Planning

HR plans must fit in with overall objectives of a firm. They must get consistent support from top management. Computerised human resource information systems must be used for applicant tracking, succession planning, building skills inventories etc. The whole exercise must be carried out in coordination with operating managers.

Human Resource Planning

Thank you