Strategic Human Resource Planning and Re-
cruitment
Introduction
Strategic Human Resource Planning and Recruitment are vital components of Human Re-
source Management (HRM), which focus on leveraging human capital to gain a competitive
edge in the market. In today’s dynamic business environment, societal trends and events sig-
nificantly impact employers, especially concerning consumer and labor markets. To effectively
utilize labor markets, organizations must have a clear understanding of their current human
resources configuration, establish a vision for the future, and address existing discrepancies.
Learning Objectives
This study material is aligned with several key learning objectives to inform your understanding
of strategic HR planning and recruitment:
1. Aligning Strategic Direction with HR Planning: Understand the process of aligning a
company’s strategic goals with its human resource planning.
2. Labor Demand Determination: Learn how to determine labor demand across various job
categories.
3. Managing Labor Surpluses and Shortages: Discuss the advantages and disadvantages
of various strategies to eliminate labor surpluses and prevent labor shortages.
4. Attractive Recruitment Policies: Explore the different recruitment policies organizations
employ to enhance the attractiveness of job vacancies.
5. Sources of Job Applicants: Identify various sources for job applicants, their advantages
and disadvantages, and effective evaluation methods.
6. Recruiter’s Role in Recruitment: Gain insight into the role of recruiters, the limitations they
face, and the opportunities available to them.
The Human Resource Planning Process
Forecasting
The Human Resource Planning process begins with forecasting, which entails predicting the
future needs of human resources within an organization. This involves assessing both the
supply of and demand for workers in various categories to identify potential shortages or
surpluses.
• Labor Demand: Organizations must create demand forecasts specific to their job cate-
gories or skill areas. This may involve statistical methods or leading indicators, which help
predict future labor demands by analyzing historical data and identifying trends.
Example of Leading Indicators
For instance, in a bakery, leading indicators could include variables like the sales per bridal
show attendee and the amount of traffic at bridal shows. A low sales figure from bridal shows
may indicate a need for improved training in sales techniques, while a busy bridal show could
suggest the necessity for additional staff to manage the increased demand.
• Labor Supply: Understanding labor supply also requires an analysis of internal resources.
This examination evaluates the current distribution of employees across job categories
using transitional matrices, which illustrate the historical flow of employees through various
roles within the organization.
Identifying Labor Surplus or Shortage
Forecasting also emphasizes understanding potential labor surpluses or shortages. Organi-
zations should assess which job categories may face these challenges and devise strategic
responses accordingly.
Goal Setting and Strategic Planning
This phase focuses on addressing labor supply and demand discrepancies through goal-setting
and strategic initiatives. It aims to create benchmarks for measuring the success of programs
designed to mitigate labor surpluses or shortages while outlining a timeline for achieving
objectives.
Options for Managing Labor Surplus
Organizations have a range of options to manage an expected labor surplus, which vary in
speed and impact on human suffering:
• Downsizing: Quick but often harmful in terms of employee morale and organizational
culture.
• Pay reductions and Demotions: Rapid methods that can lead to dissatisfaction and
disengagement.
• Work-sharing and Hiring Freeze: Moderately fast and sensitive options that help maintain
workforce morale.
Options for Avoiding Labor Shortage
To mitigate the risk of labor shortages, organizations may consider:
• Overtime and Temporary Employees: Fast solutions that can be reversed if conditions
change.
• Outsourcing: Quick and effective, albeit risks associated with quality and control.
• New External Hires: Slower but long-term solution for critical positions.
Special Considerations
Several special cases affect HR planning:
1. Affirmative Action Planning: Plans that focus on ensuring fair representation of protected
groups within the workforce by monitoring hiring and promotion practices.
2. Temporary Workers and Independent Contractors: While these roles provide flexibility
and can reduce overhead costs, they lack job security and benefits, leading to potential
dissatisfaction.
3. Immigration Policies: Organizations may utilize visas (H2-A for seasonal work, H1-B for
skilled labor) to mitigate labor shortages by incorporating foreign workers.
4. Altering Pay and Hours: Adjustments in salary and working hours can help manage
workforce demands but may strain employee relations if not handled properly.
The Human Resource Recruitment Process
Recruitment is a critical HR activity involving practices and initiatives aimed at attracting job
candidates. The recruitment process encompasses three primary aspects:
Personnel Policies
Organizations must consider internal versus external recruitment strategies, balancing job
security against the need for innovation from external recruits. Personnel policies often include:
• Promoting from Within: Encouraging career growth can enhance motivation but may
disrupt existing teams.
• Employment-at-Will Policies: These policies allow for greater flexibility in employment
decisions but may create uncertainty among employees.
Recruitment Sources
1. Internal Sources: Drawing from known employees can be cost-effective and promote
retention.
2. External Sources: Includes public/private employment agencies, online job boards, and
social media platforms. Each source has unique advantages and drawbacks, such as cost
efficiency vs. potential cultural fit.
Evaluating Recruitment Sources
The effectiveness of recruitment channels can be assessed through yield ratios, comparing the
number of applicants sourced from each channel to those who eventually get hired.
The Role of Recruiters
Recruiters, whether HR specialists or line managers, play an essential role in attracting talent.
Their effectiveness can be enhanced through:
• Warm and Informative Traits: Building a positive rapport with candidates.
• Realistic Job Previews: Providing candidates with an accurate depiction of job responsi-
bilities and organizational culture to help ensure alignment.
In conclusion, effective strategic human resource planning and recruitment align with organi-
zational goals, address labor market dynamics, and incorporate a variety of approaches to
attract and retain the talent necessary for success. Through thorough analysis and informed
decision-making, HR professionals can position their organizations for sustained competitive
advantage.
