Human Resource Planning

A. So, according to the authors of the textbook, Management of Human Resources, "human resources planning is the process of reviewing future HR requirements to ensure that the organization will have the appropriate number of employees with the necessary skills to meet its strategic objectives" (Dresslar, G et al, 2007, pg. 96).

B. Yes, that’s correct. And the authors outline three key steps involved in HR planning.

A. Alright, so what are those steps?

B. The three steps are: 1) forecasting the future needs of human resources also referred to as the demand; 2) forecasting the availability of internal and external candidates or the supply; and 3) planning and implementing HR programs to balance supply and demand.

A. So, how does one forecast future human resource needs?

B. There are various quantitative approaches HR professionals use to forecast future HR needs of their firm. These include: trend analysis, ratio analysis, scatter plots, regression analysis, and computerized forecasting. In addition, two common qualitative approaches include: nominal group technique and Delphi technique.

A. Can you give me an example of how one of these techniques is used?

B. Sure, let’s use the ratio analysis. This approach compares a casual factor, such as the amount of animation to produce, with the number of employees needed. Let’s suppose the average animator produces 30 seconds of animation each week. If a 40 minute animation is due in 5 weeks, I need 16 animators to complete the project.

A. Okay, now how about explaining some of the various techniques used to forecast the internal and external supply?

B. Alright, for the internal supply HR professionals use tools like: skills inventories, replacement charts, replacement summaries and succession planning, whereas; external supply forecasts are collected by reviewing general economic conditions, national and local labour market conditions, and occupational market conditions.

A. Can you tell me more about succession planning?

B. Sure, "succession planning is the process of planning to fill important executive positions"(Dresslar, G et al, 2007, pg. 106). Therefore, by carefully identifying and preparing suitable employees through mentoring, training and job rotation, these individuals can be ready to replace key players when needed.

A. That’s great. So, does succession planning work together with skills inventory and replacement charts and summaries?

B. Actually, skills inventory, replacement charts and replacement summaries all serve the same purpose. They provide information about the strengths and weaknesses of each employee in order to make decisions on internal candidates. Replacement charts provide a quick reference tool but lack the details found in replacement summaries or skills inventories. The information contained on these records not only helps to forecast staffing needs but provides a plan for necessary training and development.

A. You had mentioned earlier about reviewing economic, and market conditions to help forecast externally.

B. Yeah, that’s right. Two important resources to consider when performing a review are: 1) the reports on "labour force conditions" published by Statistics Canada and 2) the "short-term and long-term labour force projections", listed by occupation, published by Human Resources and Skills Development Canada.

A. So, we’ve talked about the first two steps. How about the third step?

B. Well, balancing supply and demand requires developing strategies for three possible scenarios: 1) expected labour demand matches expected labour supply; 2) expected labour supply exceeds expected labour demand; this is known as surplus; and 3) expected labour demand exceeds expected labour supply; this is known as shortage.

A. So what happens when there’s a labour surplus?

B. There are many ways companies can deal with a labour surplus. This may begin with a hiring freeze at which point current employees can be reassigned to openings. Companies may try to accelerate attrition through buyout and early retirement packages. Job responsibilities can be divided among employees through job sharing or hours can be reduced to avoid layoffs. However, some circumstances may require layoffs or terminations in order to maintain the business.

A. Well, it sounds like there are quite a few different options available other than lay offs.

B. That’s right. However, when downsizing, companies need to be extremely careful about their approach to the remaining employees. Strong emotions including feelings of betrayal, guilt, and detachment can cause employees to develop stress symptoms and reduce their performance.

A. Okay, so how should companies avoid survivor sickness?

B. HR professionals suggest keeping communication lines open. Some firms allow the remaining employees time to grieve and deal with repressed feelings and emotions through special meetings or small-group sessions.

A. Alright. Now what about when there’s a labour shortage?

B. A common response to labour shortage is scheduling overtime. Another short-time solution is to hire temporary employees. However, for long-term solutions, companies like Finning, are partnering with education institutions to train students with the necessary skills needed.

A. Great. So let's review. We learnt three steps involved in HR planning. These include:
1) forecasting the demand;
2) forecasting the internal and external supply; and
3) balancing supply and demand through HR programs.

Key Terms
This week’s HR terminology includes:
- HR planning
- Delphi technique
- nominal group technique
- succession planning
- skills inventory
- replacement charts

References
- Dresslar, G et al. (2007). Management of human resource, in-class edition, second Canadian edition. Retrieved from University of Phoenix library.

Multiple-choice quiz
*Answer found at the end of the post.

1. Replacement charts are:
A. Visual representations of who will replace who in the event of an opening
B. A list of skills and competencies possessed by an employee
C. Chart showing the interrelationships of positions within an organization in terms of authority and responsibility
D. None of the above

2. Which is not a quantitative approach for forcasting future HR needs.
A. Trend analysis
B. The Delphi technique
C. Scatter plots
D. Regression analysis

3. When labour demand exceeds labour supply, possible solutions to the problem include which of the following:
A. Hiring temporary employees
B. Scheduling overtime hours
C. External recruitment
D. Subcontracting
E. All of the above



Answers: 1) a, 2) b, 3) e