Past, Present and future Factors affecting Human Resource Planning

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Human resource planning has traditionally been used by organizations to ensure that the right person is in the right job at the right time. Under past conditions of relative environmental certainty and stability, human resource planning focused on the short term and was dictated largely by line management concerns. Increasing environmental instability, demographic shifts, changes in technology, and heightened international competition are changing the need for and the nature of human resource planning in leading organizations. Planning is increasingly the product of the interaction between line management and planners. In addition, organizations are realizing that in order to adequately address human resource concerns, they must develop long-term as well as short term solutions. As human resource planners involve themselves in more programs to serve the needs of the business, and even influence the direction of the business, they face new and increased responsibilities and challenges.

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In the beginning, HRM definition was as a Process through which a company’s management was able to determine how the company would be able to achieve a desired manpower level.” The means to achieve this were planning, and efforts by the management to employ the right kind of people at the right positions and at a proper time, and in a way that it would benefit in the long run both the company and the employees.

Presently HR management it is a part of a much wider context of the business strategic organizational plan. It is, in addition to the present planning, also forecasting all future human resources needs of the company and how to achieve best results. It starts by first determining the objectives and then try to develop programmes like appraising of the present staff, compensations, training etc. in order to make sure that people with the required qualifications and skills would be available to the company whenever they are needed. It also develops and implement various programmes aiming to improve the performance while, at the same time, the employees are kept satisfied and involved in company’s productivity, product quality and or innovation. Concluding, human resources management and planning is necessary to collect data which can be useful when it comes to evaluate how effective the ongoing programmes are, thus enabling the planners to detect and decide on necessary program revisions or forecast amendments.

As one of planning’s objectives is to improve a company’s effectiveness, it should be integrated into the company’s short and longer term business targets and operational planning. Most of the leading organizations in industry are implementing this, unlike what happened in the past when business requirements and HR planning normally were restricted only to personnel requirements. This conservative approach was in line with short-term personnel orientation. In our times, because of revolutionary changes in socioeconomic environment and business concept and the uncertainties these changes are causing, companies integrated their business planning with HR planning and management, thus creating a longer-term perspective.

HR planning process became an integral part of the strategic business planning. HR planning and management became a part of the whole company’s development and expansion planning process. Companies, at least most of them, do nothing without involving HR management in their planning either it concerns policy or finalization procedures of any kind. It can be explained as an integrated connection between HR planning and company’s business. A connection bringing together the line managers and HR planners in order to determine HR future requirements and business plans for development, analyse the workforce profile along with future business strategies, review and deal with appearing HR issues, and create programmes to face and resolve such issues thus supporting future business planning. In this way, when HR managers and planners make company’s business planners to comprehend and appreciate that HR planning and management represents a major advantage against their competitors, meaning an increase in profits provided there is a careful management. In this thesis I’ll try and explain a few of the activities where industrial and other organisations’ HR planners and managers are involved with, when trying to make an organisation more competitive by correct and effective HR planning and management.

Factors Influencing the Interest in Human Recourses Management and Planning

There is no doubt that the contemporary increased attention of the industry to HR planning and management is influenced by many factors, among others the most important are considered the new technologies, globalization, environmental concerns, changing economic conditions, and the potential of workforce changes. These factors result to a complex and uncertain business environment. Efficient operations can be influenced by uncertain conditions and force organizations to try and find ways to reduce its impact; formal and efficient planning is a tool, both industry and organizations use as a protection against business environmental uncertainties.

Considering the changes in workforce characteristics, one only of the environmental factors, though important, it is evident that there is a need for correct and timely planning and HR management. Between 1976 and 1980, the labour force in the industrialised world grew by an average of 2.8%, but between 1991 and 1995, the rate of growth dropped to 1.1 %. Also as per ILO (International Labour Organisation), and other recognized international statistical bodies, the year 1980 in USA more than 3 million people entered the country’s workforce, but only 2 million each year between 1981 and 1995. During the years 1995 and 2010 a total of 25 million workers entered the workforce. Of them the 22% were immigrants.

All these demographic projections have significant implications for human resource management, thus increasing the importance of human resources planning. The changing demographics mean that there will be fewer workers are entry-level, so the competition among employers will increase. Moreover, the changing demographics signal changes in abilities, skills, interests and values of the workforce of tomorrow. For example, the lack of many types of skilled workers are imminent, including tool-and-die makers, builders, shipbuilders, engineers, machinists, and engineers. Even if organizations are willing to train new employees, the work can be difficult.

An examination of how the values of workers who will soon constitute the majority of the workforce differ from those that will begin to leave propose additional changes in the near future. There are already signs of growing resistance from employees to relocate. Greater emphasis on self-assessment and mitigation faith and loyalty to employers makes it more difficult for agencies to undertake to move employees around anywhere and anytime. A decline in organizational trust occur at a time when workers feel insecure about their jobs.

A recent study comparing the work values of people aged over 40 years with those of 40 other proposed changes for which they must prepare.

For example, workers from the younger generation does not trust authority we do as members of the older generation, which are products of the First World War era II. The younger generation believes that the work should be fun, while the older generation sees work as a duty and a vehicle for financial support. Younger workers believe people should advance as quickly allows competence, whereas older workers believe that experience is a necessary path to promotion. Finally, the study found that the younger generation, “fairness” is to enable people to be different, but the older generation means treating people equally.

Changes in the workforce is only one aspect of the environment stimulate the need for human resource planning. Demographic change is somewhat predictable, but when considered in conjunction with changing technology and many other external changes described elsewhere in this work, will pose significant challenges for human resource planning and help to change the regime in last two decades.

A model for the description of Human Resources

The remainder of this paper will try to explain the activities performed by designers of human resources at leading organizations.

Throughout the discussion, I will describe four phases of human resource planning:

(A) gathering and analyzing data to predict the expected demand of human resources as a business plan for the future and predict future human resource supply;

(B) Establish objectives of human resources;

(C) Design and implement programs that will enable the organization to achieve the objectives of human resources; And

(D) Monitoring and evaluation of programs.

 Activities related to the four phases of human resources planning are described for three different time horizons: short term (one year), intermediate term (two to three years) and long (over three years). These correspond to typical time horizons for business planning. Using the same conventions heads use to distinguish between activities with different time horizons is a step towards human resource planners can take to facilitate the integration efforts with business needs. .

Although the four phases of human resource planning is conceptually the same regardless of time horizon, no practical difference to improve the functionality of four phases, as the time horizon expands.

Therefore, activities related to the planning horizon for each explained separately and in sequence, starting with short-term planning. We start with the smallest term planning horizon because they are historically the HRM activities of many analysts have been made to achieve short-term goals.

As organizations and HRM analysts began to recognize the potential benefits of engaging in more planning condition, however, in view of long-term issues has become more common. Therefore, as explained later in this thesis, many analysts HRM is now engaged in activities designed to prepare organizations for decades to come.

In our discussion away from the stages of human activity Resource Planning, according to three time horizons, we do not mean to suggest that organizations which separates the planning of their activities in this way. The reality is that organizations should integrate their activities in the four phases of design, and the three time horizons, as shown in Figure 1. Since the feed-forward and feed-back arrows connecting the four phases of the design show, planning activities within a time frame associated with each other in a dynamic system. Initial phases (eg, forecasts of demand and supply) to serve as inputs to subsequent phases (eg, setting goals). Equally important, organizations can learn from the results obtained during the evaluation phase and then apply what is learned to make adjustments in goals and programs.

In addition to the arrows connecting the four phases of design in each time frame, Figure 1 includes arrows to highlight

(A) How long-term goals that can influence the design of shorter term (dotted line arrows),

(B) how short-term results of the evaluation can affect the predictions for the future of human resources and programs designed to meet future requirements, and (c) the results achieved through the implementation of human resource programs may affect the business plans. Arrows connecting the design activities for different time horizons is important to note because it stressed that the planning for a time horizon usually has consequences for the other.

For example, long-term planning almost always leads to the development of programs to be implemented within a short time and intermediate term. Moreover, the evaluation results obtained for short-term projects often lead to a re-evaluation of longer term projects which in turn can induce changes in programs designed to meet longer term. The idea is to have full integration of all types of human resource planning activities and the integration between human resources and business planning.

Short-Term Human Resource Planning

Many HRM analysts work on activities related to designing and implementing programs (e.g., recruitment, selection systems, and training programs) to meet short-term organizational needs. Such activities generally involve an element of planning in that they are future-oriented to some extent. Even projects for which objectives are expected to be achieved in as little time as a few months have, ideally, been designed with an understanding of how the short-term objectives are linked to the achievement of longer term objectives. For example, an aeronautics company engaged in a recruitment campaign to hire 100 engineers should have a clear understanding of how this hiring goal will help the company achieve long-term goals such as becoming a most innovative company in that industry. This hypothetical company also might have a college recruiting drive designed to find 75 college graduates to enter a training program in recognition of the fact that a growing company needs to prepare for the middle managers it will need 5 to 7 years hence, as well as the top level managers it will need in 10 to 15 years. As this hypothetical example highlights, in order for a clear linkage to exist between human resource planning and strategic business planning, it is essential that an organization’s top executives have a fully articulated vision for the future, which has been communicated and accepted by managers throughout the organization.

Forecasting Demand and Supply

In a short-term time horizon, demand and supply of human resources can be predicted with some certainty. Human resource objectives follow logically from consideration of any discrepancies between demand and supply.

Demand refers to the number and characteristics (e.g., skills, abilities, pay levels, or experience) of people needed for particular jobs at a given point in time and at a particular place. Supply refers to both the number and characteristics of people available for those particular jobs.

Salient questions are “What jobs need to be filled (or vacated) during the next 12 months?” and “How and where will we get people to fill (or vacate) those jobs?”

What jobs need to be filled and vacated? Answering the demand question involves predicting who will leave jobs and create vacancies, which jobs will be eliminated, and which new jobs will be created. One method for predicting both vacancies and job growth is to project historical trends into the future. This is particularly relevant for organizations affected by regular, cyclical fluctuations in demand for their products or services. Behavioural theories of the causes of turnover combined with employee surveys designed to assess attitudinal predictors of turnover (e.g., job satisfaction) also help HRM analysts and human resource planners predict how many currently filled positions are likely to become vacant. Such information can produce useful predictions when the organizational unit of interest is large, although making predictions about precisely which positions are likely to become vacant is less precise. Predictions about how many and what types of jobs will be eliminated or created in the short term generally follow directly from business plans submitted by line managers.

How and where will we get people to fill and vacate jobs? The first step in answering this question-the supply question-involves determining the desired characteristics of employees who fill (or vacate) the jobs of interest.

Then the availability of those characteristics in the organization’s current work force and in the external labour market must be assessed. The particular characteristics of current and potential employees that are inventoried and tracked by human resource planners are influenced by the nature of the organization and the environment in which it operates. For example, for human resource planners in growing organizations, simply finding people with the needed skills and abilities is likely to be a top priority. For planners in mature and declining organizations, the costs (e.g., salary level) associated with employees become more salient, especially if work-force reductions are needed. Thus it is important for the human resource planner to know the business needs and characteristics of the organization. This knowledge is gained by human resource planners meeting with line managers to discuss their business plans as well as their human resource needs. The process of discussion increases the accuracy of supply and demand forecasts and facilitates the establishment of human resource objectives..

Establishing Objectives

With a short-time horizon, objectives are often easy to state in quantifiable terms. Examples of short-term human resource objectives include increasing the number of people who are attracted to the organization and apply for jobs (increase the applicant pool); attracting a different mix of applicants (with different skills, in different locations, etc.); improving the qualifications of new hires; increasing the length of time that desirable employees stay with the organization; decreasing the length of time that undesirable employees stay with the organization; and helping current and newly hired employees quickly develop the skills needed by the organization. Such objectives can generally be achieved in a straightforward way by applying state-of-the-art human resource management techniques and working with line managers to ensure agreement with and understanding of the program objectives.

Design and Implementation of Short-Term Programs

The technical skills of HRM analysts are often applied to short-term program design and implementation. For example, recruiting programs are used to influence the size and quality of the applicant pool. Selection programs are developed for making hiring decisions. Performance appraisal systems identify performance deficiencies to be corrected and competencies to be rewarded. Training programs emphasize developing skills for use in the near future. Compensation systems are designed to attract new employees, to motivate people to perform well, and to retain employees. Even when these activities are designed to achieve short-term objectives and are expected to have relatively immediate pay-offs, they can serve to help an organization achieve its longer term goals.

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A vice-president and general manager of a known Corporation (name withheld by request), described how short-term human resource planning efforts helped his organization achieve its strategic goals; The Company realized it had an opportunity to significantly increase its business, but to do so would require them to increase their hourly work force by a net of about 125 employees in one year, at a time when the local unemployment rate was only 2.5%. Past experiences had taught Barden that foreign immigrants often became excellent employees. Although there were many immigrants from a variety of different countries who were interested in employment, a major hurdle to their immediate success was their lack of fluency in English.

The said V. President and General Manager described the problem and the solution, like this:

To begin to be functioning, qualified Company’s employees, newcomers must not only master the basic “English” vocabulary, but they must be able to look up standard operating procedures, read Material Safety Data sheets, and they must also master basic shop mathematics, measurement processes and blueprint reading… . We asked Personnel to investigate how we might teach these people enough English to pay their way. The upshot was this: We employed an English language teacher. A special intensive course was developed in cooperation with our training unit…. All students are on our payroll and meet with the English instructor four hours a day for 15 consecutive work days during working hours. The effect has been amazing. The confidence level of the students has soared as they have tried out their new language ability. Supervisors are impressed. And the word is getting out to the community with positive results.

This example illustrates a problem that organizations will face increasingly in the near future, namely, a shortage of qualified entry-level job applicants.

This demographic change is likely to mean that organizations will begin to shift the focus of their short-term human resource programs. During the past 30 years, the combined forces of equal employment opportunity (EEO) legislation and the abundant supply of new entrants into the labour force were congruent with human resource activities aimed at improving the ability of organizations to select employees on the basis of their job-related skills and abilities. Organizations benefitted from investing in the design, validation, and use of selection “tests” of all sorts. This is because even tests with relatively low, but nonzero, validity can have economic utility when selection ratios are sufficiently low.

As the workforce shrinks, but the selection conditions will become more bigger. As a result, small marginal gains in test validity have less economic benefit, based on the past. To yield to invest in the development and use of modern methods for selecting economic returns have much more energy to combat the recruitment efforts for the number of candidates because only increase by attracting a large pool of candidates can be considered fair selection addressed are low. If small selection ratio can not be maintained, organizations can be concluded that their resources are better in training, efforts to achieve these few that are available to prepare invested.

Examples of innovative recruiting programs are already plentiful. For example “X” Inc., has a mobile recruitment office, a van that a closed recruitment center that is looking for candidates, by visiting schools, shopping centers, and so on. “X-2” employs successful minority business people to help in the community to recruit minority applicants and act as mentors. We can look at a real example: McDonald’s Corporation as a leader in the recruitment of older workers emerged, which with TV commercials and formal relationships with senior citizens organizations. It is important to note that these efforts require the pool of candidates so often a coordinated medium-term programs designed to ensure that the non-traditional recruitment are effective and can be retained to expand.

Evaluation of Short-Term Human Resource Programs

Since for any evaluation of the program, true, this phase involves evaluating how well objectives have been achieved. Due to determine the short-term planning in terms of objectives, in general, that relatively easy to quantify (eg the number of candidates is the number of hires and performance of employees), systematic evaluation of programs for short-term organizational needs, staff development is quite feasible , and some types of program evaluations are indeed common in large organizations. For example, in part because a number of international and state laws prohibit certain forms of discrimination, in particular the selection programs have been carefully checked to ensure that employers make decisions concerning the selection of candidates, characteristics that are job related basis. Legal regulations have prompted many organizations, especially large, to evaluate empirically the relationship between applicant characteristics (eg skills) and job performance. Such evaluation studies (validity studies) benefit the employers because they serve the purpose of getting the right people in the right job monitor. Validity studies also serve an academic function by valuable data for researchers interested in improving our understanding of the factors that influence human performance.

Until recently, when programs for the selection, training and motivation of HRM analysts criteria of effectiveness have been almost exclusively behavioral changes (such as performance and turnover were assessed) or settings (eg, job satisfaction and commitment). Such criteria have no defense to be accepted by analysts, but line management support for Human Resource programs can be difficult if the expected results of such programs are not translated in the language of business, that is, to get money. Building with continued progress in the utility analysis techniques, and human resources cost estimation techniques, it is always possible compelling economic arguments in support of human resources programs.

of So, rather than argue for energy to spend resources to short-term programs that perform HRM analysts in organizational settings are free, more extensively engaged in medium-and long-term human resources issues.

Intermediate Term Human Resource Planning

As we have noted, is planning organizations used to the production or service delivery processes buffer from sources of uncertainty. Human resource programs for the recruitment, selection, training and motivation of staff to help reduce the uncertainty by ensuring that a sufficient number of people with the required characteristics and skills are available at all levels in the organizations.

If the planning horizon is short, there is little uncertainty about what skills and how many people are needed, and it is forecast to provide relatively easy.

However, rapid and ongoing changes in today’s business world means that not just the future by simply projecting past trends can be expected. As the focus moves from short term planning in the medium term the question “what do we need?” is less easy to answer and so is always dominant. For medium-term planning, there is more uncertainty with respect to the question “What will there be?” Consequently, personnel planning for the distant future quickly raises the question, “How can we determine what is needed and what will there be?” In other words, more technical attention be given to the problem of forecasting.

As a short-term staffing to provide the two problems of forecasting, demand and forecasts of both, before goals can be demonstrated and developed programs are addressed. With the growing uncertainty, the interaction between the human resource planners and line managers is critical for accurate forecasts of supply and demand.

Medium-term Demand Forecast

To forecast the number and characteristics of people who are necessary to the jobs that will exist in the organization of medium-term future (is in two three years ago), the strategic planner and try to organizational outputs to predict, as expected, the production volume, turnover and levels. The outputs that an organization to deliver produce or to use in combination with the technology, the organization that wants to dictate to generate the outputs, the human resources needs of the intended organization. Prediction outputs needed in view of factors such as future requirements of the market for the products and services, the organization offers, the share of the market that the organization is likely to be able to serve, the availability and nature of new technologies that the amounts can affect, and types of products or services that may be offered, and the various countries to serve in which the organization of it.

The task of drawing up plans that specify the intended future results (in terms of quantity, type and location) of the organization is usually the responsibility of middle level managers. Human resource planners need to translate these objectives must be for outputs to predict the amount and type of jobs that people perform in order will produce the desired results. Prediction of future needs of human resources requires:

(A) Once an accurate model of the factors that influence the demand and

(B) is able to predict the state of all important variables in the model.

Organizations that may be quite stable in environments that most models of the main factors that determine the demand for up to three years in the future to construct part. It is even possible that some organizations to quantify the expected values of the variables in their models, what they can statistical forecasting techniques such as regression analysis, using time series analysis and stochastic modeling of the human means demand forecast. For companies that are in an unstable environment, however, still three years predictions probably the most uncertain, since both the variables and their expected values difficult to specify precisely by on historical data.

Given the complexity of the statistical forecast, it is understandable that the evaluative techniques used more frequently than statistical techniques.

A simple type of judgmental forecasting is a Senior estimate. Estimates of staffing are made by middle-and lower-level line managers, which they pass to the top manager for further changes to an overall strategy demand forecast form. Increasingly, planners are human resource in these stages of the estimation and revision involved an integrated approach to planning ensured.

A more sophisticated method of judgmental forecasting, the Delphi technique, developed a decision-making method in order to maximize benefits and minimize the dysfunctional aspects of group decision making is.

In a Delphi “session” (which must not be face-to-face) take, several experts will present their forecasts and assumptions. An intermediary is any expert in the forecast and assumptions to the other, then the changes in their own forecasts. This process continues until a viable composite forecast is created. The composite may represent specific projections or a series of projections, depending on the expert positions. The Delphi technique seems to be particularly useful for the generation of solutions for unstructured and complex issues, such as those generated during the planning. There are limits, however. For example, if experts do not agree that their views on a final solution that all parties accept the yield can be difficult. Nevertheless, the personnel integrate planners various forecasts to establish the human resource objectives and design programs to achieve these objectives, and line managers are the forecasts as appropriate when they accept offers for their support during the implementation phase of the Human Resources Programs .

Both executives estimates and the Delphi technique usually on forecasts for the number of employees, the focus is likely to be needed. Less attention is usually paid to the question of quality (eg, skills and abilities) that require the prospective employee is primarily because techniques were not widely available for predicting this.

If analysts participate in short-term planning, job analysis is used to need the qualities that employees in order to determine current run existing jobs. Rapid technological changes mean jobs in the future are certain jobs in the present, however, differ.

As an indication of the fact that HRM analysts now frequently deal with problems of medium-term planning, research, efforts are underway to establish procedures for the implementation of future-oriented (“strategic”) job analysis and identifying the leadership skills that are necessary for developing effective performance in the future. Because job analysis results in the basis on which the majority of human resource programs are constructed, the development of sound future-oriented job analysis methods is a challenge that must meet HRM analysts before they can realize their potential as contributors to the long-term effectiveness of organizations.

Forecasting Intermediate-Term Supply

Supply forecasts can be derived from information from both internal and external sources, but internal sources are usually the most important


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