According to Agulana and Awujo (2011:37)
citing Nwachukwu (2000:58) the essence of human resources (manpower) planning
to have:
- a. The right people.
- b. In the right number.
- c. With the right knowledge.
- d. In the right jobs.
- e. In the right places.
- f. At the right time.
- g. At the right cost.
The implication here is that human resources planning is
interested both in the right quantity and right quality of employees at the
time.
Human resources is the set of individuals who make up the
work force of an organization, business sector, or economy. Human capital is
sometimes used synonymously with human resources although human capital
typically refers to a more narrow view that is the knowledge the individuals
embody and can contribute to an organization. Likewise, other terms sometimes
used included “manpower”, talent, labour or simply people.
The professional disciplines and business function that
oversees an organization’s human resources is called human resources
management.
Pioneering economist John R. Commons used the term human
resource in his 1893 book The Distribution of wealth but did not further build
upon it. The term human resources was sequently in use during the 1910s and
1920s as was the notion that works could be seen as a kind of capital asset.
Among scholars the first use of human resource in its modern form was in 1958
report by an economist called E. Weight Bakke.
This is the development of a comprehensive strategy for
meeting the organization’s future human resources need. It is the process by
which management makes certain that it has the right number of people with the
appropriate skills in the right place at the necessary time. The human resources
planning involve three steps;
Firstly, the present human resource must be assessed to
determine whether the work force is appropriate for the firm’s current needs
and whether it is being used properly. Secondly, the human resource forecast of
future personnel needs must be conducted comparing current employee’s skills
and their projected skills at some future date with the expected organizational
needs. Finally, a program must be developed for meeting future human resource
needs. This forecast stores blue print for training current employees and
recruiting new employees to meet organizational needs as they occur.
Key Components of Human Resource Planning
Forecasting Demand and Supply:
- Demand Forecasting: Estimating the number and types of employees the organization will need in the future. This involves analyzing business plans, market trends, and technological advancements.
- Supply Forecasting: Assessing the availability of employees, both internally (current workforce) and externally (labor market). This includes evaluating factors like employee turnover, retirements, and the labor market conditions.
Gap Analysis:
- Identifying the difference between the current human resources and future needs. This helps in understanding the gaps in terms of skills, numbers, and competencies required.
HR Strategies and Action Plans:
- Recruitment and Selection: Strategies to attract and hire employees with the necessary skills and qualifications.
- Training and Development: Programs to upskill current employees to meet future demands.
- Retention Strategies: Initiatives to retain key talent and reduce turnover.
- Succession Planning: Preparing for future leadership and critical roles by developing internal talent.
Implementation and Monitoring:
- Putting the HR plans into action and continuously monitoring their effectiveness. Adjustments are made as necessary to align with changing business needs and market conditions.
Importance of Human Resource Planning
Aligning HR with Business Goals:
- HRP ensures that human resource strategies are in line with the overall strategic goals of the organization. This alignment is crucial for achieving long-term business success.
Optimal Utilization of Resources:
- By planning ahead, organizations can make better use of their human resources, avoiding both shortages and surpluses.
Enhanced Employee Development:
- Through HRP, organizations can identify the training and development needs of their employees, which leads to improved performance and career growth.
Risk Management:
- Effective HRP helps in anticipating and mitigating risks related to talent shortages, high turnover rates, and skill mismatches.
Cost Efficiency:
- Proper planning helps in reducing costs associated with hiring, training, and employee turnover by ensuring a steady and well-prepared workforce.
Challenges in Human Resource Planning
Dynamic Business Environment:
- Rapid changes in technology, market conditions, and business strategies can make it difficult to accurately forecast HR needs.
Workforce Diversity:
- Managing a diverse workforce with varying needs and expectations adds complexity to HRP.
Legal and Regulatory Changes:
- Compliance with evolving labor laws and regulations can impact HR planning efforts.
Economic Factors:
- Economic downturns or booms can significantly influence labor market conditions and availability of talent.
Internal Organizational Changes:
- Mergers, acquisitions, and internal restructurings can disrupt HR plans and require frequent adjustments.
Best Practices in Human Resource Planning
Data-Driven Decision Making:
- Utilizing data analytics to make informed HR decisions and forecasts. This includes leveraging HR software and tools for better accuracy.
Regular Review and Adjustment:
- Continuously reviewing and updating HR plans to reflect changes in business strategy and market conditions.
Collaborative Approach:
- Involving various stakeholders from different departments to ensure a comprehensive understanding of the organization's HR needs.
Focus on Employee Engagement:
- Creating a work environment that promotes engagement, satisfaction, and retention.
Succession Planning:
- Identifying and developing internal talent to fill key positions, ensuring leadership continuity.
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