HUMAN RESOURCE
PLANNING
PROJECT BY
POOJA AGARWAL – 7
PAKSHAL JAIN – 8
HEMANGI BHATT – 9
NATASHA BISWAS – 10
FATEMA BURHANI – 11
ARINDAM CHAKRAVARTY – 12
Q.1 Failure in planning and developing HR could be a limiting factor in
attaining organizational goal.
“Explain the statement in reference to the objective and importance of hr
planning” (2008)
(10 MARKS)
Objectives of HRP
The objectives of HR plan must be derived from organizational objectives like specific
requirements of numbers and characteristics of employees etc. HRP needs to sub-serve the
overall objectives by ensuring availability and utilization of human resource.
The following are the objectives of HRP:-
1. Optimum Utilization – To ensure optimum use of human resources currently employed by
recruiting employees who possess the necessary skills and competences. It also helps the
organization to get rid of unnecessary and unneeded labour.
2. Controls cost – HRP helps to estimate the cost of human resources. It controls the cost aspect
of human resources by cutting down surplus, redundant manpower and retaining and redeploying
the manpower appropriately. . The resources that will be needed to subsequently recruit, hire,
and train new employees may well exceed any short-term cost savings. Human resources
planning typically anticipates future staffing requirements which will help an organizations to
avoid cost errors.
3. Availability of workforce- The purpose of HR planning is to ensure that a predetermined
number of persons with the correct skills are available at a specified time in the future. It ensures
the availability of workforce to meet the HR needs at the time of expansion/diversification. With
the help of HRP short and long-term staffing requirements will be assessed to ensure that
adequate numbers of appropriately qualified employees are available and positioned correctly to
meet the goals of company.Once the organizational objectives are specified, communicated and
understood by all concerned, the HR department must specify its objectives with regard to HR
utilization in the organization.
HR planning is to get the right number of people with the right skills, experience and
competencies in the right jobs at the right time at the right cost. Human resource planning is the
responsibility of all managers. It focuses on the demand and supply of labor and involves the
acquisition, development and departure of people. This is recognized as a vital HR function as
the success of an organization depends on its employees.HRP clearly states the importance of
manpower planning.
The Importance of HRP is:
1. Forecast personnel needs: Planning is significant as it helps determine future personnel
needs. Surplus or deficiency in staff strength is the result of the absence of or defective planning.
The problem of excess staff has become so heavy that many units are restoring to VRS to
remove the excess staff. Such surplus labour (even shortage) would not have been there if there
were HRP.
3. Creating highly talented personnel: , since jobs are becoming highly intellectual and
incumbents are getting vastly professionalized. L&T, an engineering giant, has MBA’s,
engineers, technicians who collectively constitute 70% of the total employee strength of 20,000.
The HR mgr. must use his/her ingenuity to attract and retain qualified and skilled personnel.
Another fact of the high-talent personnel is mgt. succession planning. Who will replace the
retiring chief executive? From what pool of people will top executives be selected and how will
these individuals be groomed for their increased responsibilities? HRP is an answer to these and
other related questions.
4. International strategies: International expansion strategies largely depend upon effective
HRP. With growing trends towards global operations, the need for HRP further becomes more
important as the need to integrate HRP more closely into the organization keeps growing. This is
also because the process of meeting staffing needs from foreign countries grows in a complex
manner. Foundation of personnel functions: HRP provides essential information for designing
and implementing personnel functions such as recruitment, selection, personnel development,
training and development etc. Without effective HRP and subsequent attention to employee,
recruitment, selection, placement, development and career planning, the growing competition for
foreign executives may lead to expensive and strategically-disruptive turnover among key
decision makers.
5. Foundation for Personnel Functions: HRP provides essential information for designing and
implementing personnel functions, such as recruitment, selection, personnel movement(transfers,
promotions, layoffs) and training and development.
6. Increasing investments in HR: Another importance is the investment that an organization
makes in human capital. It is important that employees are used effectively throughout their
careers. The rupee value of a trained, flexible, motivated and productive workforce is difficult to
determine, although attempts are being made to do so, as in HR accounting(HRA).an increasing
number of executives are acknowledging that the quality of the workforce can be responsible for
significant differences in short-run and long-run performances.
7. Resistance to change & move: There is a growing resistance among employees to change
and move. There is also a growing emphasis on self-evaluation and on evaluation of loyalty and
dedication to the organization. All these changes are making it more difficult for the organization
to assume that it can move its employees around anywhere and anytime it wants, thus increasing
the importance and necessity of planning ahead.
8. Unite the Perspective of Line and Staff Managers: HRP helps unite the perspective of both
line as well as staff managers. Although HRP is initiated and executed by the corporate HR staff,
It requires the input and cooperation’s of all managers within an organization. No one knows
better the needs of a particular unit or department than individual managers responsible for the
area. Communications between HR staff and line managers is essential for the success of HR
planning initiatives.
Q.2 Write a short note on Human resource information system (2008)
(3 MARKS)
The Human Resource Information System (HRIS) is a software or online solution for the data
entry, data tracking, and data information needs of the Human Resources, payroll, management,
and accounting functions within a business. Normally packaged as a data base, hundreds of
companies sell some form of HRIS and every HRIS has different capabilities. Pick your HRIS
carefully based on the capabilities you need in your company. Typically, the better The Human
Resource Information Systems (HRIS) provide overall steps in implementation.
1. Inception of idea.
2. Feasibility study.
3. Selecting a project team.
4. Defining the requirement.
5. Vendor analysis.
6. Package contract negotiation.
7. Training.
8. Tailoring the system.
9. Collecting the data.
10. Testing the system.
11. Starting up.
12. Running in parallel.
13. Maintenance.
14. Evaluation.
Use of HRIS
1. Employee and labour relations.
2. Health, safety and welfare.
3. Compensation and benefits.
4. HR development.
5. Staffing.
6. Equal employment.
7. HR planning and analysis.
Q.3 Downsizing (2005/09)
(3 MARKS)
Downsizing or rightsizing means reducing the size of the workforce to maintain the employee
strength at the most desired level. In reality it means reducing the employee strength through
planned elimination of jobs. A record of sort was created by GE when it released 104,000 of its
402,000 of workers during the 1980’s
Downsizing is not a involuntary separation method by itself. In fact to downsize employee
strength firms tend to adopt other methods. But because of its repeated focus in corporate circles,
we choose to discuss downsizing as an involuntary method of separation.
Downsizing is triggered by at least three factors –
1. The company’s bottom line is threatened
2. Technological advancement renders people redundant
3. Organizational restructuring.
Q.4 Voluntary Retirement Scheme (V.R.S). (2008)
(3 MARKS)
Voluntary retirement scheme (VRS) is a type of separation. Beginning in the early 1980’s
companies both in the public and private sector have been sending home surplus labour for good,
not strictly by retrenchment, but by a novel scheme called the VRS, euphemistically called the
Golden Handshake Plan. Handsome compensations are paid to those workers who opt to leave.
Managements prefer to pay hefty sums to reduce staff strength then retaining surplus labour and
continue to pay them idle wages. Further, VRS is perceived as a painless and time saving method
of trimming staff strength, easing out unproductive older workers and other deadwood. Unions
too, cannot object as the schemes are voluntary.
VRS also results in separation of employees from employer. VRS is resorted to where
organiztions have surplus labour. Firms will be required to pay wages for idle time if VRS is not
invoked to trim the surplus labour force.
Q.5 Organizational Downsizing/ rightsizing (2008)
(5 MARKS)
Downsizing or rightsizing means reducing the size of the workforce to maintain the employee
strength at the most desired level. In reality it means reducing the employee strength through
planned elimination of jobs. A record of sort was created by GE when it released 104,000 of its
402,000 of workers during the 1980’s
Downsizing is not a involuntary separation method by itself. In fact to downsize employee
strength firms tend to adopt other methods. But because of its repeated focus in corporate circles,
we choose to discuss downsizing as an involuntary method of separation.
Downsizing is triggered by at least three factors –
1. The company’s bottom line is threatened
2. Technological advancement renders people redundant
3. Organizational restructuring.
Downsizing, though claimed as a desirable corporate strategy, creates more problems than it can
solve. One of the biggest problems is employee morale. Downsizing creates not a ripple but a
tidal wave throughout the organization. The surviving employees experience trauma – they have
lost identity, colleagues, security, power and control. Moreover, the economic benefits expected
by the organization often fail to materialize.
As proof of this, a study conducted by the American Management Association during the 1980’s
is worth recollecting. About half of the responding firms reported an increase in operating profits
a year or more after downsizing. Only 34 per cent achieved increased productivity and over 30
per cent increased decreased productivity. A staggering 86 per cent experienced diminished
employee morale. Only 61 per cent achieved cost reduction.
Downsizing has a ripple effect on family and children perceive a great fall and spouse
experiences utter helplessness, particularly when the discharged employee was a main prop for
the family. Downsizing should be handled carefully because of its negative impact
The guidelines for effective handling of downsizing are:
1. Consider the human element.
2. Make “who goes and who stays” decisions judiciously.
3. Delay any pay hikes.
4. Freeze hiring.
5. Restrict overtime.
6. Retrain or redeploy employee.
7. Engage part – time employees.
8. Switch to job sharing.
9. Resort to across – the – board pay cuts.
10. Implement early retirement programs.
11. Attend to morale of serving employees.
Q.6 Write a short-note on promotion and transfer (2005/09/06)
(5 MARKS)
Definition
1. In terms of a career, a promotion refers to the advancement of an employee's rank or position
in a hierarchical structure.
2. In sales, promotion refers to a different sort of advancement. A sales promotion entails the
features - via advertising and/or a discounted price - of a particular product or service.
Product promotions can also be classified as "sales" or "specials.
A promotion is the advancement of an employee’s position in an
organizational hierarchy system. Promotion may be an employee's reward for good performance
i.e. Positive appraisal. Before a company promotes an employee to a particular position it
ensures that the person is able to handle the added responsibilities by screening the employee
with interviews and tests and giving them training or on-the-job experience. A promotion can
involve advancement in terms of designation, salary and benefits, and in some organizations the
type of job activities may change a great deal.
Purpose
An organization chooses to promote an employee due to certain reasons. These reasons are as
follows
1. To motivate employees
2. To fill in internal vacancy
3. To build loyalty
4. To retain employees
5. To groom succession planning.
Principles of promotion
Promotion is a double-edged weapon. If handled carefully, it contributes to employee
satisfaction and motivation. If mishandled, it leads to discontentment, frustration, skepticism and
bickering among the employees. The policy of promotion should be clear on the following
matter:
(i) The management must make it clear whether to fill up higher positions by internal promotions
or recruit people from outside. Generally, top positions in an organization are filled through
external recruitment. The lower positions, however, are filled up by promotions from within.
(ii) When it has been decided to fill up higher positions with promotions, a further decision on
determining the basis of promotion should be made by the management. The basis of promotion
may be seniority or merit or both.
If seniority is the basis for promotion, an employee with the longest period of service will get
promoted, irrespective of whether he or she is competent to occupy a higher post or not.
Advantages of promotion:
1. Present employees if promoted can handle the process products and problems easily as they
are already connected to organization but new incumbent may take some to adjust him or
may not adjust himself at all.
2. The cost of training the insiders for the higher position is nearly nil hence no extra training
cost.
3. Employees will give their best as they know that reward of giving good performance is sure.
4. High morale of the employees is achieved.
Types of promotion.
As already noted, a promotion involves an increase in status, responsibilities and pay. But, in
certain cases, only the pay increases. In other cases, the status only increases without a
corresponding increase in pay or responsibilities, Promotions may be classified into the
following types:
(i) Horizontal Promotion This type of promotion involves an increase in responsibilities and
pay, and a change in designation. But the employee concerned does not transgress the job
classification. For example, a lower division clerk is promoted as an upper division clerk. This
type of promotion is referred to as 'upgrading' the position of an employee.
(ii) Vertical Promotion This type of promotion results in greater responsibility, prestige and
pay, together with a change in the nature of the job. A promotion is vertical when a canteen
employee is promoted to an unskilled job. the concerned employee naturally transgresses the job
classification.
(iii) Dry Promotions Dry promotions are sometimes given in lieu of increases in remuneration.
Designations are different but no change in responsibilities. The promotee may be given one or
two annual increments.
Definition
A transfer is a lateral move to a position in the same classified pay range (classified position) or
to a position with comparable duties and responsibilities (non-classified positions).
A transfer differs from a promotion in that the latter involves a change in which a significant
increase in responsibility, status and income occurs, but all these elements are stagnant in the
former. Another difference is that transfers are regular and frequent , as in banks and other
government establishments , but promotion are in frequent , if not irregular.
Reasons for transfer
The reasons for transfers vary from organization to organization, and from individual to
individual within an organization. Broadly speaking, the following are the reasons for transfers:
1. Shortage of employees in other departments.
2. Correction of faulty initial placement of an employee.
3. A change is needed due to interest factor and capacities of an individual for a particular
job.
4. To break the monotony of work.
5. Health issues.
6. Family related issues cause transfers.
Procedures
Employees are considered as candidates for transfer in the following order or priority:
1. Eligible employees in same department as the job opening
2. Eligible employees in other departments who have requested a transfer
3. Eligible employees being considered for lay-off due to a reduction in force
Employees desiring a transfer will submit a written request for transfer to his/her department
head. The employee should identify the specific vacancy in which they are interested. The
department head will forward the request to the Department of Human Resources fo
recommended action.
The Department of Human Resources will determine whether the desired job or a suitable job
opening exists. If a suitable job is available, the Department of Human Resources will arrange
for the employee's application to be reviewed by the department in which the opening exists.
Employees will be allowed time off with pay for job interviews related to transfers. The decision
to effect the transfer will be made by the head of the department in which the job opening
occurs. An employee who is transferred to a comparable job (lateral transfer) will continue
to receive his/her existing rate of pay.
Types of transfer
Broadly speaking, transfers may be classified into three types:
1. Those designed to enhance training and development.
2. Those making possible adjustment to varying volumes of work within the firm.
3. Those designed to remedy the problem of poor placement.
Specifically, transfers may be production, replacement. versatility, shift and remedial.
(i) Production Transfers: As mentioned earlier, a shortage or surplus of the labour force is
common in different departments in a plant or several plants in an organisation. Surplus
employees in a department have to be laid off, unless they are transferred to another department.
Transfers effected to avoid such imminent lay-offs are called production. Transfers.
(ii) Replacement Transfers: Replacement transfers, too, are intended to avoid imminent
lay¬offs, particularly, of senior employees. A junior employee may be replaced by a senior
employee to avoid laying off the latter. A replacement transfer program is used when all the
operations are declining, and is designed to retain long-service employees as long as possible.
(iii) Versatility Transfers: Versatility transfers are effected to make employees versatile and
competent in more thali one skill Clerical employees in banks, for example, are transferred from
one section to another over a period of time so that they may acquire the necessary skills to
attend to the various activities of the bank. Versatile operations are valuable assets during rush
periods and periods when work is dull. Versatile transfers may be used as• a preparation for
production or replacement transfers.
(iv) Shift Transfers: Generally speaking, industrial establishments operate more than one shift.
Transfers between shifts are common, such transfers being made mostly on a rotation basis.
Transfers inay also be effected on special requests from employees. Some request a transfer to
the second shift or the night shift in order to avail the free time during the day to take up part
time jobs, although this is not permitted by law.
(v) Remedial Transfers : Remedial transfers are effected at the request of employees and are,
therefore, called personal transfers. Remedial transfers take place because the initial placement
of an employee may have been faulty or the worker may not get along with his or her supervisor
or with other workers in the department. He or she may be getting too old to continue in his or
her regular job, or the type of job or worki(l.g conditions may not be well-adapted to his or her
present health or accident record. If the job is repetitive, the worker may stagnate and would
benefit by transfer to a different kind of work.