Human Resource Planning Meaning, Nature And Need Of HRP

Table of Content:–

Meaning of Human Resource Planning
Definition of Human Resource Planning
Nature of Human Resource Planning
Need of Human Resource Planning
Characteristics of Human resource planning
Objectives of Human Resource Planning
Importance of Human Resource Planning
Scope of Human Resource Planning
Purpose of Human Resource Planning
Factors Influencing Human Resource Planning

Meaning of Human Resource Planning

Human Resource Planning Meaning: Another name for Human Resource Planning is Manpower Planning. Human Resource Planning (HRP) can be defined as a process of balancing the people’s supply including the present and prospective employees with the potential job openings in the organisation in a given period. It is the system of the organisation to ensure the availability of the right number of people, the right type of people, at the right time and the right place to attain the organisational objectives.

HRP is also known as:

Manpower planning,
Personal planning or
Workforce planning.

It comes under the preview of organisational planning and is a future-oriented activity. Inappropriate planning may result in the excess recruitment of the staff, a rise in expenses regarding direct costs and training costs and other amenities for employees besides the production cost. Inappropriate recruitment also results in an adverse impact on the self-esteem and the efficiency of the employee. All these factors highlight the importance of HRP in an organisation

Definition of Human Resource Planning

Human resource planning is the systematic process used by managers and businesses to ensure that an organisation has proficient employees required to perform the job, it ensures growth and success for business.

In the words of K Aswathappa, “HR Planning is the process of forecasting a firm’s future demand for, and supply of, the right type of people in the right number.”

Y.C. Moushell states, “Human Resource Planning is a strategy for the acquisition, utilisation, improvement and preservation of an organisation’s human resource”

In the words of J.Chennly.K, “Human Resource Planning is a process of forecasting an organisation’s future demand for human resource and supply of right type of people in right numbers”.

According to Robbins and Coulter, “HR Planning is the process by which manager ensures that they have the right number and right kind of capable people in the right places and at right times.”

As per E.W. Vetter, “A process by which an organisation should move from its current manpower position to the desired manpower position. Through planning the management strives to have the right number, right kind of people at right place and at right time, doing things which results in both organisation and individual receiving maximum long-run benefits.”

Nature of Human Resource Planning

The nature of human resource planning is as follows :

1) Continuous Activity

It is an ongoing activity as the need for assessing the supply and demand of the manpower resources within the organisation never comes to an end.

2) Specified Objectives

HRP objectives may be guided by the strategic and operational planning of the organisation. The needs of the human resources within the organisation are based on the firm’s objectives HRP also aims at developing human resources, sharpening the technical skills of resources, assisting them in planning their career map, retaining them, etc.

3) Assessing the Staff Requirements

HRP focuses on the pre-planning of the needs regarding human resources within the organisation. All the proceedings related to the recruitment, selection and training procedure are planned.

4) Maintaining Inventory of Existing Human Resources

It consists of the record of present human resources. The manager must be aware of the available manpower supply for fulfilling the higher positions in the future.

Need of Human Resource Planning

Human resource planning is needed for the following reasons:

1) Balancing Employment-Unemployment Situation

HRP tries to balance the educated unemployed skilled youth of the nation and the skill requirements in the industry.

2) Technological Upgradations

There have been continuous upgrades in the marketing methods management techniques, and systems of the production technologies in the industry. It has also demanded modifications to the job profiles. HRP must plan the manpower needs accordingly to avoid redundancy, re-training, or re-deployment problems.

3) Changes in the Organisational Environment

In the dynamic and ever-changing business environment, organisations are always subjected to variations and breaks in their system of working. Therefore, organisations must rely on HRP to strategically plan their manpower requirements.

4) Diverse Workforce

In the present scenario of the business environment, the workforce consists of people of different ages, genders, social backgrounds and cultures having different skills altogether. An effective HRP is required here for proper planning of the manpower needs of the organisations.

5) Skill Shortages

In this competitive era of business, the system of working in organisations is becoming more and more complicated on account of the special and rare skills required within the firm for accomplishing the task. Therefore, HRP has an important task of not only attracting the required potential but also ensuring retaining them in the organisation.

6) Government Interference

Various legislative measures such as provisions regarding the work conditions and working hours, restrictions on child and women employment, contract labour, casual labour, etc. and government interference in the administration of the functioning of the firm have necessitated more systemic HRP for the firms.

7) Judicial Regulations

Gone are the days when employees were treated as objects within the organisation. The various legislative measures have strengthened the positions of the employees in the organisation. Various labour laws have been implemented to ensure that the employees do not face unjustified lay-off, retrenchment, etc. HRP is responsible for forecasting the requirements after considering this fact.

8) Justified Recruitment

It is very natural for an organisation to get recommendations for recruitment from various groups like trade unions, political groups, and private sources. To avoid this type of partial recruitment, HRP must be strictly implemented in the system.

9) Systematic Concept

As with the growth of the concept of people management, there has been a need to maintain transparency in the system which can be fulfilled by maintaining a systematic and transparent record by HRP.

10) Lead Time

As new employees are being trained for the new job responsibilities and profile, sufficient time is required for the employees and for the management to assess the employee’s worth and assign tasks accordingly. HRP provides lead time for all these issues.

Characteristics of Human Resource Planning

An analysis of the above definitions reveals the following characteristics of human resource planning:

(i) HRP like all planning is forward-looking or future-oriented. It involves forecasts of the manpower needs in a future period so that adequate and timely provisions may be made to meet the needs.

(ii) Human resource planning is an ongoing or continuous process because the demand for and the supply of human resources undergo frequent changes.

(iii) HRP plays an important role in corporate planning. Without a well-defined corporate plan, the development of a comprehensive manpower plan is impossible.

(iv) The basic purpose of human resource planning is to ensure the optimal utilization of an organization’s current and future human resources.

(v) Human resource planning encompasses both quantitative and qualitative aspects. The former implies the right number of employees while the latter means the right talent required in the organisation.

(vi) Human resource planning is the primary responsibility of management to ensure the effective utilisation of the organisation’s human resources.

Some more characteristics of Human resource planning

(vii) HRP is a systematic approach to managing human resources. The information about the demand and supply of human resources constitutes the input. Comparison and evaluation of demand and supply so as to identify the gap between the two is the transformation process. The outputs of human resource planning are the strategy and programme formulated to bridge the gap.

(viii) Human resource plans can be long-term or short-term Long-range plans are prepared for a period of five years or more on the basis of trends in the economy, labour market and production. These reflect management thinking on the organisation structure, business environment and human resource policies. Short-term manpower plans cover time periods ranging from one year to less than five years. These are concerned with filling existing jobs Long-range and short-range plans work in harmony with each other.

(ix) HRP is a two-phased process involving the calculation of the demand for and supply of human resources, so as to secure an equilibrium between the two. A manpower plan consists of two sub-plans:

(a) A manpower demand plan, and
(b) A manpower supply plan.

(x) HRP involves the study of the manpower environment which influences the demand for manpower and its supply. It also involves the study of manpower utilisation.

Objectives of Human Resource Planning

The main objectives of human resource planning are given as follows:

1. It ensures the optimum use of existing human resources.

2. It involves forecasting future requirements for human resources.

3. It provides control measures to ensure the availability of essential human resources whenever they are needed.

4. It establishes a strong connection between human resource planning and organisational planning.

5. It evaluates the availability of human resources and identifies both surpluses and shortages.

6. It anticipates the impact of technology on jobs, employment and human resources.

7. To determine levels of recruitment and training.

8. To estimate the cost of human resources and housing requirements of employees.

9. To provide a basis for the implementation of effective management development programs.

10. It plays a crucial role in facilitating productivity bargaining.

11. To meet the needs of expansion and diversification programmes help takes necessary measures.

Effective manpower planning aims to align future human resources with the evolving needs of the enterprise, thereby optimizing the return on investment in human capital. By strategically forecasting and managing the workforce, organizations can maximize their future gains from human resources.

Importance of Human Resource Planning

Effective human resource planning has the following benefits:

(1) To carry on its work and to achieve its objectives, every organisation requires employees who possess sufficient knowledge, experience, and aptitude. Human resource planning is helpful in the selection and training of employees. It ensures that an adequate number of persons are selected and trained well in advance to fill future job vacancies in the organisation.

(2) HRP identifies gaps in existing manpower both in terms of talent and quantity. By recognizing these gaps, organizations can proactively address them through suitable training and other strategic measures.

(3) Provision for the replacement of personnel can be made through effective human resource planning. If there is a need to replace employees who resign, die, retire and become incapacitated due to injury.

(4) HRP plays an important role in the expansion and diversification of an organisation. In the absence of human resource plans, the required human resources will not be available to execute a smooth and efficient expansion process.

(5) HRP promotes the optimum utilization of human resources throughout the organization. By strategically aligning workforce needs with organizational goals, it effectively reduces wastage of manpower at the right time.

(6) HRP is useful for the effective use of technological progress. It is used to retrain existing employees and recruit new talent to meet the challenge of new technology.

(7) HRP effectively manages manpower within an organization. By applying the strategic approach, organizations can proactively identify areas where there is an excess of personnel and promptly take appropriate measures, such as redeployment.

Some more importance of Human Resource Planning

(8) HRP is a valuable tool for estimating and managing the cost of human resources. The budgeting process can be facilitated through its effective use. Additionally, it plays an important role in controlling costs.

(9) HRP fosters career and succession planning within an organization. It provides ample time and opportunities for employees to progress through promotions and it ensures a smooth transition of employees to higher positions. Moreover, it also contributes to the development and succession of management personnel.

(10) The HRP process ensures that the organization effectively plans and provides necessary amenities to support the well-being and productivity of its workforce. This approach helps in planning for physical facilities, such as a canteen, staff quarters, dispensary, and school for employees and their children.

(11) At the national level, HRP plays an important role in facilitating educational reforms, promoting geographic mobility of talent and job creation.

Scope of Human Resource Planning

The scope of human resource planning not only includes identifying the manpower requirement but also includes the following:

1) Fulfilling Manpower Need

HRP can only satisfy the needs of the human resources in the organization when it carries out its functions of planning, recruiting and selecting, induction and placement, training and development, transfer and promotion, compensation and motivation effectively.

2) Predicting Human Resources Issues

HRP tries to maintain a balance between the existing resources and the expected future positions in the organisation. It helps in identifying whether the manpower is adequate or not both in terms of quantity and quality.

3) Maintaining the Current Manpower Inventory

This may require maintaining data about the employees relating to the different variables like skills, potential, work preferences, etc.

4) Projecting Future Human Resource Requirements

Projecting the demand for manpower in the organisation requires a lot of calculations, mathematical calculations, analysing the environment from different perspectives and formulating specific plans for the future.

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Purpose of Human Resource Planning

The purpose of HRP is as follows:

1) Analysing Manpower Gap

Human resource planning tries to identify the gap between the existing resources and future requirements by imparting training and sharpening skills.

2) Optimum Utilisation of Human Resources

The first and foremost important responsibility of the HRP is to ensure the maximum utilisation of the existing and future human resources within the organisation.

3) Achieving Organisational Objectives

HRP especially focuses on the needs relating to growth, expansion, diversification or any other strategy for the growth of the organisation.

4) Efficient Change Management

HRP of a firm helps to take necessary measures to meet day-to-day environmental changes like changes in products, market conditions, technological upgrades, policy changes by the government, etc.

5) Evaluation of the Current Workforce

Human resource planning mainly evaluates the existing workforce to know about its strengths and weaknesses.

Read More:– Process of Human Resource Planning

6) Furnishing the Accurate Details

HRP provides detailed information about idle or underutilised human resources. It also assists in the decision-making of allied fields of management related to promotions, etc.

7) Assessing Manpower Requirements

HRP plays a very important role in assessing the future requirements of human resources with accuracy. If a well-planned HRP does not exist, then it would be hard for the organisation to have the right type of people at the right time.

Factors Influencing Human Resource Planning

Various factors influence human resource planning. These factors can be classified as follows:

1) External Factors

External factors are those factors which externally influence human resource planning. They include:

i) Legislative Provisions

Various provisions relating to labour laws, reservations in recruitment, and initiated by the government, etc. affect HRP.

ii) Level of Economic Development

The level of human resource development in the country is determined by the level of economic development. This helps to determine the future supply of human resources.

iii) Business Environment

The environment in which the business operates comprises the external and internal factors which influence the business. These kinds of environmental factors have an impact on the total volume of the product mix and accordingly, the human resources supply in the future is also influenced.

iv) Technological Advancements

Technology can be defined as the phenomenon of applying knowledge practically which may give rise to new inventions. The type of human resources required is also influenced by the level of technology.

v) Global Influences

Factors which have a worldwide impact on aspects like the supply and demand of manpower in various regions of the world also influence human resource planning.

2) Internal Factors

These are those factors which internally influence human resource planning. These factors are summarised as follows:

i) Firm’s Plans and Guidelines

The company’s strategy for growth, expansion or diversification dictates the need for human resources in terms of quantity and quality within the organisation.

ii) Rules and Regulations for Human Resources

The specified rules and regulations for human resources within the organisation regarding the skills required, the amount of compensation, provisions for the workforce, etc., affect HRP.

iii) Job Analysis

It is a comprehensive study of a particular job concerning the skill to accomplish a particular task. The comprehensive study of the job helps to determine the type of skills required in the persons to be recruited within the firm.

iv) Perspective of Timeframe

The HRP of the organisation varies from company to company according to the environment in which it is operating. If the environment is relatively stable, the company can go for long-term planning but if the environment in which the company operates is highly dynamic, it is recommended for the company to opt for short-term planning.

v) Reliability and Credibility of Information

Effective planning is based on accurate data about related factors. In every organisation, HRP is based on data relating to factors like the capital budget, organisational structure, level of technology, functional area objectives, job analysis, sources of recruitment, retirement plans, etc.

vi) Policies for the Firm’s Operational and Production System

The HRP of a firm is also based on the company’s decision regarding the quantity to be produced or to be purchased from the market. It decides the number of persons required for the production of the same within the system.

vii) Trade Unions

The various measures taken by the trade unions to safeguard the employees’ interests will have an impact on the HRP. The decisions regarding the working hours, sources for recruitment, etc., have an impact on the HRP.

viii) Phases of Organisational Lifecycle

The different phases of the organisational lifecycle will have a due impact on the HRP of the firm. In the growth stage of the firm, the employees will be required to recruit additionally to cope with growing demand whereas, at the same time in the declining stage, employees will be retrenched to cut costs. In both cases, human resource planning is very important.