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Chapter Objectives
After studying this chapter, you should be able to
LEARNING OUTCOME 1 Define and explain the importance of Human Resource Planning
(HRP).
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Strategic Planning and Human Resources
• Strategic Planning
Procedures for making decisions about the
organization’s long-term goals and strategies
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Strategic Planning and HR Planning
1–4
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The Importance of HRP
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The Importance of HRP
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Linking Strategic Planning and HRP
• Strategic Analysis
What human resources are needed and what are
available?
• Strategic Formulation
What is required and necessary in support of human
resources?
• Strategic Implementation
How will the human resources be allocated?
1–7
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1–8
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Step One: Mission, Vision, and Values
• Mission
The basic purpose of the organization as well as its
scope of operations
• Strategic Vision
A statement about where the company is going and
what it can become in the future; clarifies the long-
term direction of the company and its strategic intent
• Core Values
The strong and enduring beliefs and principles that the
company uses as a foundation for its decisions
1–9
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Step Two: Environmental Analysis
• Environmental Scanning
The systematic monitoring of the major external
forces influencing the organization.
– Economic factors: general, regional, and global conditions
– Industry and competitive trends: new processes, services,
and innovations
– Technological changes: robotics and office automation
– Government and legislative issues: laws and
administrative rulings
– Social concerns: child care and educational priorities
– Demographic and labor market trends: age, composition,
literacy, and immigration
1–10
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Step Two: Environmental Analysis (Cont.)
1–11
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Step Two: Environmental Analysis (Cont.)
Culture Capabilities
Internal
Analysis
Composition
1–12
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Forecasting: A Critical Element of Planning
• Forecasting involves:
forecasting the demand for labor
forecasting the supply of labor
balancing supply and demand considerations.
1–13
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1–14
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Forecasting Demand for Employees
Quantitative Methods
Forecasting Demand
Qualitative Methods
1–15
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Quantitative Approach: Trend Analysis
1–16
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Quantitative Methods
1. Trend Analysis
Forecasting the employment needs is based on study of an
organization past employment needs over a period of years to predict
the future needs.
e.g. sales index.
2. Ratio Analysis
Forecasting is based on ratio such as sales volume and number of
employees needed.
e.g. the achieve sales target, how many employees or salesperson
should do the job. (refer figure 2.5)
3. Correlation Analysis
Forecasting is based on mathematical formula that measures the
degree of association that exist between two or more variables.
measures the relationship between two items
if changes in one item will result in changes in the other item
e.g. does 3 employees could complete the task given or more or less
employees? So, the manager or researcher will do some research to
get the answer.
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Qualitative Approaches
• Management Forecasts
– The opinions (judgments) of supervisors, department
managers, experts, or others knowledgeable about
the organization’s future employment needs.
• Delphi Technique
– Judgments of a pre-selected group of individuals who
are an expert in forecasting the future employment
needs.
– Their opinion are then combined and returned to them
for the second opinion and continuous until they
agreed on a judgments.
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Qualitative Approaches
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Forecasting the Supply of Employees:
Internal Labor Supply
• Staffing Tables
• Markov Analysis
• Skill Inventories
• Replacement Charts
• Succession Planning
1–20
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Forecasting Internal Labor Supply
• Staffing Tables
– Graphic representations of all organizational jobs,
along with the numbers of employees currently
occupying those jobs and future (monthly or yearly)
employment requirements.
• Markov Analysis
– A method for tracking the pattern of employee
movements through various jobs.
• Skill Inventories
Files of personnel education, experience, interests,
skills, etc., that allow managers to quickly match job
openings with employee backgrounds.
• Replacement Charts
Listings of current jobholders and persons who are
potential replacements if an opening occurs.
• Succession Planning
The process of identifying, developing, and tracking
key individuals for executive positions.
1–22
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Forecasting the Supply of Employees:
Internal Labor Supply
1–23
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1–24
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Step Four: Formulating Strategy
• Strategy Formulation
Moving from simple analysis to devising a coherent
course of action.
• SWOT analysis
A comparison of strengths, weaknesses, opportunities,
and threats for strategy formulation purposes.
Use the strengths of the organization to capitalize on
opportunities, counteract threats, and alleviate internal
weaknesses.
1–25
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Step Four: Formulating Strategy
1–26
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Step Four: Formulating Strategy
Corporate Business
Formulating
Strategy
Functional – HR alignment
1–27
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Step Five: Strategy Implementation
1–28
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HRP RESULTS
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Managing Labor Surplus
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Managing Labor Shortage
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Step Six: Evaluation and Assessment
1–32
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Problems That Hinder Effective HRP
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Key Terms
1–34
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