MODULE 2

Human Resource Planning

Dr. Shruthi M
Associate Professor
MBA programme - BIET
 Content for discussion
HR Planning:
 Importance of HR Planning,
 Manpower Planning to HR Planning,
 Factors Affecting HR Planning,
 Benefits of HR Planning,
 HRP Process,
 Tools for Demand Forecasting,
 Attributes of Effective HR Planning,
 Barriers to HR Planning,
 The Challenges for HR, the Process of Job Analysis,
 Job Description, and Job Evaluation.
Recruitment and Selection:
▪ Importance of Recruitment,
▪ Recruitment Policies,
▪ Factors Influencing Recruitment,
▪ Recruitment Process, Sources,
▪ Evaluation of the Recruitment Process,
▪ Recruitment Strategy,
▪ Future Trends in Recruitment;
▪ Selection Process
▪ Selection Tests
▪ Factors Influencing Selection.
 Meaning
 Human Resource Planning is, the planning of human
Resources. It is also called manpower planning/ personnel
planning/ employment planning.

 It is only after Human Resource Planning that the

Human Resource department can initiate the recruitment
and selection process. Therefore Human Resource
Planning is a sub-system of organizational planning.
 Definition
 Human Resource Planning is a strategy for the
acquisition, utilization, improvement and
preservation of an organization's human
resource” – Y.C. Moushell

 “Human Resource Planning is a process of

forecasting an organization's future demand
for human resource and supply of right type
of people in right numbers” – J.Chennly.K
 Human Resource Planning process

Organizational Objectives

Human Resource
Planning

Forecasting needs for Forecasting supply of

Human Resources human resources

Identification of human
resource gap

Surplus Human Shortage of human

Resources resources

Action plans
Labour Market = Labor supply + Labor demand
 A labor market is a geographical
area within the sources of supply
[people looking for work] interact
with the forces of demand
[employers looking for people]
and thereby determine the price of
labor.
 Demand for labour is a derived
demand - not wanted for its own
sake but for what it can contribute
to production
Labor Supply
 Labor supply is the availability of workers who possess
the required skills that an employer might need.
 Factors affecting Supply of Labor:
1. Population growth – births, deaths, migration, age
2. Education & Training.
3. Opportunity cost of Work.
4. Social demand.
5. Wage levels and working conditions.
6. Career guidance, counseling, job information etc.
Labor Demand
 Labor demand is the number of workers an
organization needs.

 Factors affecting labor demand:

1. Technology
2. Changing demand patterns of consumers.
3. Labor laws regarding workers, safety, reward, etc
4. Labor productivity
 Need for Human Resource Planning
1. organization needs competent staff with the necessary qualifications,
skills, knowledge, work experience and aptitude for work.
2. Since employees exit and organization both naturally (as a result of
superannuation) and unnaturally (as a result of resignation), there is an
ongoing need for hiring replacement staff to augment employee exit.
Otherwise, work would be impacted.
3. In order to meet the need for more employees due to organizational
growth and expansion,
4. Often organizations might need to replace the nature of the present
workforce as a result of its changing needs
To meet the challenge of the changed needs of technology/product/service
innovation the existing employees need to be trained or new skill sets induced
into the organization.
5. Manpower planning is also needed in order to identify an
organization’s need to reduce its workforce.
Objectives of Human Resource Planning
 Optimum utilization of human resources currently employed in
the organization.
 To reduce the imbalance in distribution and allocation of
manpower in organization for various activities.
 To ensure that the organization is well-equipped with the
required Quantity and Quality of manpower on a sustained
basis.
 To predict the impact of technology on jobs and resources.
 To control the cost of Human Resources employed, used, and
maintained in the organization.
 To improve the standards, skill, knowledge, ability, discipline
etc.
Importance of Human resource Planning
utilization of human resources
Prepare people for future
Expand or contract
Cut costs
Backup staff
To achieve an integration
Create reservoir of talent
Succession Planning
 Tools for Demand Forecasting
 Ratio-trend Analysis - studying past ratios, say, between the number of
workers and sales in an organization
 Regression Analysis - observing the regression line, one can find out the
number of employees required at each volume of sales.
 Delphi Techniques - Delphi technique is a method of forecasting
personnel needs
 Work Study Technique - Commonly referred to as workload analysis,
the work-study technique predicts comprehensive activities and
production for a specified future time period
 Econometrics Models - The econometrics model analyses the
relationship of a dependent variable with an independent variable. An
example of a dependent variable is human resources and an example of
an independent variable is sales. Statistical and mathematical techniques
used throughout the econometrics model allows human resource
management professionals to estimate future demand with significant
accuracy
 Barriers to HRP
Human Resource Planners face significant barriers while formulating an HRP. The major
barriers are elaborated below:
1. Accuracy of Forecasting – HRP involves forecasting the demand and supply of human
resources.
2. Identity Crisis - Many of the organization’s human resources do not know the whole
process of HRP. Because of this, there is generally an identity crisis. Till the specialist
are developed a strong sense of purpose, planning will be effective.
3. Support of the Top Management – HRP requires full and wholehearted support from the
top management.
4. Resistance from the Employees – Employees and trade unions resist manpower
planning. They feel that this planning increases their overall workload and regulates
them through productivity bargaining.
5. Insufficient Initial Efforts – Successful HRP flourishes slowly and gradually. Sometimes
sophisticated technologies are forcefully introduced just because competitors adopted
them.
6. Management Information System – In the most of Indian industries, HR Information System has not
fully developed. In the absence of reliable data it would not be possible to have effective planning.

7. Expensive & Time consuming – HRP is a time consuming process. Employers may resist man power
planning feeling that it increases the cost of manpower.

8. Conflict may exist between short term and long term HR needs. For example, there can be a conflict
between the pressure to get the work done on time and long term needs, such as preparing people for
assuming greater responsibilities. Many managers are of the belief that HR needs can be met
immediately because skills are available on the market as long as wages and salaries are competitive.
Therefore, long times plans are not required, short planning are only needed.

9. There is conflict between quantitative and qualitative approaches to HRP. Some people view HRP as a
number game designed to track the flow of people across the department. Others take a qualitative
approach and focus on individual employee concerns such as promotion and career development. Best
result can be achieved if there is a balance between the quantitative and qualitative approaches.

10. Non-involvement of operating managers renders HRP ineffective. HRP is not strictly an HR
department function. Successful planning needs a co-ordinated effort on the part of operating managers
and HR personnel.
 Organisation plan includes
1. Average costs of recruitment per year.
2. Average cost of recruitment per staff.
3. Average cost of training per year.
4. Percentage training cost.
5. Sales turnover or productivity.
6. Health safety cost per year.
7. Compensation and benefit cost
8. Training cost per employee.
9. Salary budget ratio/sales turnover.
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 Job Analysis
 Job analysis was conceptualized by two of the founders of
Industrial/organizational psychology, Fredrick Taylor,
and Lillian Moller Gilbreth in the early 20th century

 Job analysis is the process of gathering information about

a job. to be more specific, a systematic investigation of
the tasks, duties and responsibilities necessary to do a job.
1. Task: A task is a specific piece of work or activity carried out
as part of a job.
Example: In a Data Entry Operator's job, Task: Enter
customer information into the database accurately.
2. Duty: A duty is a broader function or a group of related
tasks that form a major part of a job role.
Example: In an Accountant’s job: Duty: Maintain financial
records.(This duty includes tasks like recording journal
entries, preparing ledgers, and reconciling bank statements.)
3. Responsibility: Responsibility refers to the obligation to
perform duties and tasks correctly and be accountable for
their outcomes.
Example: In a Project Manager's job: Responsibility: Ensure
that the project is completed within the deadline and budget,
and meets quality standards.
 Definitions (Continued)

 Job analysis - Systematic process of determining the

skills, duties, and knowledge required for performing
jobs in an organization
 Job description – Document providing information
regarding tasks, duties, and responsibilities of job
 Job specification – Minimum qualifications to
perform a particular job

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Job Analysis: A Basic Human Resource Management Tool

▪Human Resource
Tasks Responsibilities Duties Planning
▪Recruitment
▪Selection
▪Placement and
Job
orientation
Descriptions
Job ▪Training and
Analysis Development
Job
Specifications ▪Counseling
▪Performance Appraisal
▪ Employee safety
▪Job design and redesign
Knowledge Skills Abilities
▪Job evaluation

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 Nature of job analysis

Job Tasks

Job Analysis Job Duties

Job Responsibilities
 Nature Of Job Analysis
Job analysis is an important human resource activity.

1. Task is an identifiable work activity.

2. Duty is larger work segment consisting of tasks.
3. Responsibilities are obligations to perform certain tasks and duties

▪ It Identifies what people should do in job.

◼ Work activities and behaviors
◼ Interactions with others
◼ Performance standards
◼ Financial and budgeting impact
◼ Machines and equipment used
◼ Working conditions
◼ Supervision given and received
◼ Knowledge, skills, and abilities needed

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 Significance or uses of job analysis
 Human resource planning
• Forecasting Human resource requirements
• Facilitates the formulation of systematic promotion and transfer
policy.
• Helps determine the quality of human resources needed in the
organization.
 Recruitment.
• How and when to hire people for future job openings.
• Understanding the skills needed for positions vacant
 Selection.
• Proper understanding of the job
Ex: Supermarket
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 Placement and orientation:
• Place them on jobs based on interest, activities and knowledge.
• What work needs to be done
• Clearly define a job
 Training and Development:
• Proper training efforts should be initiated.
• Additional training can be determined after the specific needs of
job have been identified through job analysis.
 Counseling:
• Managers should properly counsel the employees about careers.
• Employees should understand the specific needs of various other
jobs
• Helps employee to develop further a carrier.
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 Use of job analysis
 Employee Safety:
Unsafe conditions should be taken care.
 Performance appraisal:
Comparing employees with actual standards
Pay fair remuneration based on performance.
 Job Design and Redesign
Locate weak spots and undertake remedial steps
Eliminate unnecessary steps
Redesign a job to match the mental makeup of employees
Job evaluation:
Helps in finding the relative worth of the job.
Helps to assist in designing proper wage policies, With internal pay
equity between jobs.
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 When do you carry out job analysis
It is carried out on three occasions:
1. When new organization is established.
2. when new jobs are created.
3. When job undergo radical transformation changes in
• New technologies
• Methods

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 Process of Job Analysis
Jobs can be analyzed through a process, which consists of five steps.
1. Organisation analysis
• Obtain Information about various jobs in the organisation
• Analyse the linkages between jobs and organisational objectives
and interrelationship between the critical jobs
• The required background information for this purpose is obtained
through organisation charts and work flow charts
2. Selection of representative positions to be analyzed: It would
be highly difficult and time-consuming to analyze all the jobs. So,
the job analysis has to select some of the representative positions in
order to analyze them.
3. Collection of job analysis data: This step involves the collection
of data on the characteristics of the job the required behaviour and
the personal qualifications needed to carry out the Drop efficiently
several techniques are available to fetch data but care should be
taken to use only reliable and acceptable techniques in a given
situation

Sources of Data

Data may be obtained from the employees who actually perform the job
other employees sector supervisors managers and foremen to watch the
workers while doing the job and by acquire knowledge about it

Outside observers are specially appointed employees performing a job.

such outside persons are called job analysts and sometimes special job
reviewing committees are also established
Methods of data collection- job analysis
 Personal observation- the analyst observes the workers doing the
job. The task performed the pace at which the activities are done,
working conditions etc. Observed during a complete work cycle.
 Job performance- job analyst actually performs the job in
question and does received first hand experience of contextual
factors on the job including physical hazards social demand
mental requirements etc. This method is useful for jobs that can be
easily learned
4. Developing a job description -This step involves describing the
contents of the job in terms of tasks, duties, responsibilities,
operations etc. The incumbent of the job is expected to discharge
the duties and responsibilities also to perform the functions and
operations listed in job description.
 Panel of experts- uses senior job incumbents and superiors who have
extensive job knowledge. To get the job analysis information the
analysts conducts an interview with the experts.
 Critical incidents - critical incident are recorded by analyst, superior
or by employee himself. The analyst then categorizes this incident as
effective and ineffective behavior.
 Interview- the interviews collects accurate and complete data, the
important attitudes of the interviewer are
 The interviewer should introduce himself to the workers
 You should not tell the employee how to do the job
 He has to do a complete job study
 He should not confuse the work with the worker. You should analyse
the job and not worker
 Information sources for the interviews can be
 Individual employees
 groups of employees
 Superiors with knowledge of the job
5. Developing a job specification: This step involves conversion
of the job description statements into a job specification. Job
specification or job requirements describes the personnel
qualities, traits, skills, knowledge and background necessary for
getting the job done.

6. Developing employee specification: This final step involves

conversion of specification of human qualities under job
specification into an employee specification. Employee
specification describes physical qualifications, educational
qualifications, experience requirements etc., which specify that
the candidate with these qualities possess the minimum
qualities listed in the job specification.
Job description
 A written statement of what the worker actually does how
he or she does it and what the jobs working conditions are
included
 List of jobs duties responsibilities reporting relationships
working conditions and supervisory responsibilities
Sections of a typical job description include

 Job title- describes the position and department

 Job summary- brief write up about the job
 Job activities- description of the responsibilities and
duties
 Standards of performance- expected results
 Working condition - physical environment
 Contents of job description
❖Job Title.
Job title, code number, department
❖Job Summary:
A brief up.
❖Job Activities
❖Working Condition
Heat, light, noise and hazards.
❖Social Environment
Size of work group and interpersonal interactions required
to do the job.
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 Problems of job Description
Job description serves as a valuable guide both for employer
and employees.
1. It is not easy to reduce all the essential components of a
job in the form of a clear and precise document.
2. Job descriptions are sometimes are not updated as job
duties change
3. They can limit the scope of activities of the job holder,
reducing organizational flexibility.

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 Job specification- written statement of personal attributes in terms
of education experience case is to perform a particular job.
 It is a statement of the minimum acceptable qualification that an
employee must possess to perform a given job successfully.
➢ Minimum acceptable qualifications that a person should possess in order
to perform a particular job
➢ It summarizes human characteristics needed for satisfactory job
completion.
Its specifies
 Education
 Experience
 Knowledge
 Physical skills
 Communication skills
 emotional characteristics
RECRUITMENT
 Introduction To recruitment
 Once the required number and quality of
talents are determined, the management
has to find the means of attracting them
towards the organization before selecting
suitable candidates for jobs.

 All this process is generally known as

“RECRUITMENT”.
 Recruitment
 The process of finding and hiring the best-
qualified candidate (from within or outside from
an organization) for a job opening, in a timely
and cost effective manner.

 The recruitment process includes analyzing

the requirements of a job,
attracting employees to that job, screening and
selecting applicants, hiring, and integrating the
new employee to the organization.
 According to Edwin B. Flippo

 “Recruitment is the process of searching the candidates

for employment and stimulating(encouraging|) them to
apply for jobs in the organization”.
 Recruitment is the activity that links the employers and the
job seekers.
 Recruitment refers to the process of attracting, screening,
selecting, and onboarding a qualified person for a job
A few definitions of recruitment are
 Recruitment is defined as, "the process of
finding and attracting capable applicants for
employment.

 According to Desler, Recruitment means finding

and attracting a fairly large number of well
qualified applicants for the employers’ open
positions.
• Recruitment aims at
1. Attracting the large number of qualified applicants
who are ready to take up the job, if it is offered.
2. Offering enough information for unqualified persons
to self select themselves,
ex: The recruitment ad of a foreign bank may invite
applications from charted accountants, who have cleared
the CA examination in the first attempt.
 Objectives of Recruitment
 To attract people with multi-dimensional skills

 To fill fresh blood at all levels of organization.

 To search/head-hunt people whose skills fit the company’s

values.

 To search for talent globally.

 To predict and find people for positions that do not exist.

 Determine present and future manpower requirements of

the organization in coordination with planning and job
analysis activities.
 Support the organization ability to acquire, retain and develop the
best talent and skills.

 Obtain the number and quality of employees that can be selected in

order to help the organization to achieve its goals and objectives.

 Create a pool of candidates so that the management can select the

right candidate for the right job from this pool

 Attract and encourage more and more candidates to apply in the

organization

 Increase the pool of candidates at minimum cost.

 Acts as a link between the employers and the job seekers

Internal factors:
Company’s pay package - Refers to the salary, benefits, and incentives
offered to attract and retain employees.
Quality of work life - Indicates the overall work environment and
employee satisfaction in balancing work and personal life
Organizational culture - The shared values, beliefs, and practices that
shape employees’ behavior and workplace atmosphere.
Career planning and growth - Opportunities provided by the company
for employees to develop skills and advance in their careers
Company’s size - The scale of the organization in terms of employees,
operations, and market presence, influencing job security and roles.
Company’s products and services - The nature and reputation of what
the company offers to the market, affecting its attractiveness to
candidates.
 Geographical spread of the company’s operations - The
locations and reach of the company’s branches or offices,
impacting job postings and transfers.
 Company’s growth rate - The speed at which the company is
expanding, signifying stability and future career prospects.
 Role of trade unions - The influence and presence of employee
unions which can affect labor relations and recruitment
policies.
 Cost of recruitment - The expenses involved in hiring new
employees, including advertising, interviews, and training.
 Company’s name and fame - The reputation and brand image
of the company in the industry, which can attract high-quality
talent.
External factors:
❖ Socio economic factors - Influence workforce characteristics and
consumer behavior through elements like income, education, and social
status.
❖ Supply and demand factors - Determine the availability of labor
and jobs based on market needs and resource constraints.
❖ Employment rate - Indicates the proportion of the workforce
currently employed, reflecting economic health.
❖ Labour market conditions - Describe the balance between job
vacancies and job seekers, affecting wages and hiring practices.
❖ Political, legal and governmental factors - Include laws, regulations,
and policies that shape employment rights and labor standards.
❖ Information systems - Support decision-making and efficient
management of HR activities through data processing and
communication technologies.
 Significance of recruitment
 Determine present/future requirements of firm in Increase
the pool of job candidates at minimum cost.
 Help to increase the success rate of selection process.
 Meet organizations legal/social obligations regarding
composition of its workforce.
 Increase organizational/individual effectiveness in
short/long run.
 Help the firm to create more culturally diverse work force.
 Refers to policies and practices that seek to include people
within a workforce who are considered to be in
organization.
Sources are those where prospective employees are available like
employment exchange while techniques are those, which stimulate the
prospective employees to apply for jobs like nomination by employees,
advertising, promotion etc.
Internal sources
• Present Permanent employees
• Present temporary and casual employees
• Retrenched or retired employees
• Dependents of deceased, disabled, retired and present employees
• Promotions
• Transfers
External sources are those, which are outside the
organizational pursuits. These include:-
• Campus recruitment
• Private Employment agencies
• Public Employment exchanges
• Professional Associations
• Data Banks
• Casual Applications
• Trade Unions
• Advertisements
• Employee Referrals
 What is Selection
 To select means to choose.
 Selection is the process of picking individuals who have
relevant qualifications to fill jobs in an organization.
 The basic purpose is to choose the individual who can most
successfully perform the job, from the pool of qualified
candidates.
 It is a deliberate( intentional) effort of the organization to select
a fixed number of personnel from a large number of applicants.
 The primary aim of selection is to choose those persons who
are most likely to perform the jobs with maximum effectiveness
and to remain with the company.
 Purpose of Selection
 Select suitable candidate.
 Determine applicant’s capabilities.
 Place right candidate at right job.
 Generate information about candidate.
 To save cost.
Pre-requisites of Selection Procedure
 Development of Job analysis.
 HRP.
 Candidates have been attracted.
 Employee specifications.
 Recruitment
Three essentials of selection procedure
 Someone should have the authority to select.
 JD and JS to be available beforehand.
 There must be sufficient number of applicants from
whom the required number of employees must be
selected
Factors affecting selection Procedure
 Profile matching.
Possible care is to be to be taken to match the candidates
bio data with Job specification.
 Organization and social environment.
 Successive hurdles.
It is a means to say that hurdles in form of different rounds
are created at every stage of the selection process.
1. Preliminary Interview
2. Selection Tests
3. Employment Interview
4. Reference and Background Checks
5. Selection Decision
6. Physical Examinations
7. Job Offer
8. Contract Of Employment
9. Evaluation of Selection program
1. Preliminary Interview:
The purpose of this interview is to scrutinize the
applicants, i.e. elimination of unqualified applications.

2. Selection Tests:
Different types of selection tests may be
administrated, depending on the job and the company.
Generally tests are used to determine the applicant’s
ability, aptitude, and personality.
3. Employment Interview:
The next step in the selection process is employment
interview, an interview is conducted at the beginning, and
at the selection process of the employment interview can
be one- to-one interview or panel interview.

4. Reference and Background Checks:

Many employers request names, addresses, telephone
numbers or references for the purpose to verify
information and gaining additional background
information of an applicant.
5. Selection Decision:
Selection decision is the most critical of all steps in
selection process. The final decision has to be made
from the pool of individuals who pass the tests,
interviews and references checks.

6. Physical Examinations:
After selection decision and before the job offer is
made, the candidate is required to undergo a physical
fitness test. A job offer is often; depending upon the
candidate being declared fit after the physical
examinations.
7. Job Offer:
The next step in selection process is job offer. Job offer is made through a letter

of appointment. Such a letter generally contains a date by which the appointee

must report on duty

8. Contract Of Employment:

Basic information is written in Contract of employment that varies according to

the levels of job. After the offer and acceptance of the job certain document is the

attestation form.

9 Evaluation of Selection program:

The broad test of effectiveness of the selection process is a systematic evaluation

.a periodic audit is conducted in the HR department that outlines and highlights

the areas which need to be evaluated in the selection process

 SELECTION
PROCEDURE
.
HIRING DECISION Step 8

REFERENCE CHECKS Step 7

MEDICAL EXAMINATION Step 6

SELECTION INTERVIEW Step 5

SELECTION TESTS Step 4
APPLICATION BLANK Step 3
SCREENING INTERVIEW Step 2
RECEPTION Step 1
 Application Blanks
Contents of Application Blanks:
 Personal data (address, sex, identification marks)
 Marital data (single or married, dependents)
 Physical data (height, weight, health condition)
 Educational data (levels of formal education, marks)
 Employment data (past experience, reasons for leaving
previous job, salary drawn, etc.)
 Extra-curricular activities data (sports/games, NSS, etc.)
 References (name of two or more people who certify the
suitability of an applicant to the advertised position)
Selection Tests

(a) Aptitude Tests

(b) Personality Tests
(c) Interest Tests
(d) Performance Tests
(e) Intelligence Tests
(f) Knowledge Tests
Selection Interview

(a) The non-directive interview

(b) The directive or structured interview
(c) The situational interview
(d) The behavioral interview
(e) Stress interview
(f) Panel interview