CONCEPT
Process of determining an organization’s human resource needs.
Systematic reviewing human resource requirements to ensure that the required
number of employees, with the required skills, are available when they are
needed.
Forecasts an organization’s future supply of, and demand for, employee.
Accurate estimation of human resource needs and course of action to meet the
objectives of organizations.
OBJECTIVES
Balancing demand and supply of workers
Controlling cost of human labor
Formulate policies on transfer, succession , relocation of manpower
Ensuring right kind of people at the right time and place
IMPORTANCE
HR statistics in the US suggest companies lose $550 billion annually due to workers
feeling dissatisfied or disengaged.
Businesses emphasis on building a healthy organizational structure that motivates the
workforce, and on promoting healthy communications between management and
employees. Effective management and planning for human resources can assist in this.
Enables businesses to meet their current and future demands for talent
Allows the person to find out which job is right for them so that the right employee can be
hired for the right job and there is no hassle of having to train again and again. It also helps
reduce costs.
Acts as an intermediary between the employer and the employee for the exchange of
information and information.
PROCESS(contd…)
1. Analyzing organizational objectives
Idea about the work to be done in organization
2. Inventory of present human resources
Assessment of current number of employees, their capacity, performance and
potential. Internal and external sources can be estimated for filling the job requirements.
3. Forecasting the demand and supply of human resource
To find what quality and quantity of HR needs in future, with the reference of future
plan, policy, programme and projects of the organization
For supply, HR department must look first at internal sources (promotion, transfer,
etc) and then external sources (schools, college, job markets, and all the job seeker).
PROCESS(contd…)
4. Estimating manpower gaps
HR demands and supply forecast are matched to determine future shortage or
surpluses of HR in terms of quality and quantity. If the shortage, then additional staffs are
approached. If there is surplus of staffs then reduction.The early retirement, layoff,
leaves, reduced work hours overcome the problem of over staffing.
5. Formulation of action plan
HR plan depends on whether there is deficit or surplus in the organization. Plan
for new recruitment, training, interdepartmental transfer in case of deficit of termination,
or voluntary retirement schemes and redeployment in case of surplus.
6. Monitoring, controlling and feedback
Involves implementation of the HR action plan. HR are allocated as per
requirements, and inventories are updated over a period.The plan is monitored strictly to
identify the deficiencies and remove it. Comparison between the HR plan and its actual
implementation is done to ensure the appropriate action and the availability of the
required number of employees for various jobs.