Factors Affecting HRP

7/31/2019 Factors Affecting HRP

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Factors Affecting HRPHRP is influenced by several considerations. The more important ofthem are : (1) typeand strategy of organisations , (2) organisationalgrowth and planning , (3)environmental uncertainties , (4) timehorizons , (5) type and quality of forecasting

information , (6) nature ofjobs filled , and (7) off-loading the work (see Fig 4.1)Type and Strategy of organizationThe type of organization is an important consideration because itdetermines theproduction processes involved , number and type of staffneeded , and the supervisoryand managerial personnel required.Manufacturing organizations are more complex in this respect thanthose that renderservices.The strategic plan of the organization defines the organisationsHR needs. For example,a strategy of organic growth means thatadditional employees must be hired.Acquisitions or mergers, on theother hand, probably mean that the organisation willneed to plan forlayoffs, since mergers tend to create, duplicate or overlappingpositionsthat can be handled more efficiently with fewer employees.Primarily, the organization decides either to be proactive orreactive in HRP. It caneither decide to carefully anticipate the needsand systematically plan them to fill themfar in advance, or it can simplyreact to needs as they arise. Of course, careful planningto fill HR needsbetter helps ensure that the organisation obtains the right number ofHRpeople with proper skills and competencies when they are needed.Similarly, theorganisation must determine the breadth of theplan. Essentially, the organisation canchoose a narrow focus byplanning in only one or two Hr areas, such as recruitment orselection,or it can choose a broad focus by planning in all areas includingtraining,remuneration and so n.The organisation must also decide upon the formality of the plan.It can decide to havean informal plan that lies mostly in the minds ofthe managers and personnel staff.Alternatively, the organisation canhave a tormalised plan which is clearly spelt out inwriting, backed bydocumentation and data.Finally, the organisation must make a decision on flexibility-theability of the HR plan toanticipate and deal with contingencies. Noorganisation likes high levels of uncertainty.Organisations seek toreduce uncertainty by planning, which includes forecastingandpredicting possible future conditions and events. HRP can obtainmanycontingencies, which reflect different scenarios thereby assuring that theplan isflexible and adaptable.Figure 4.2 summarises these five major choices faced by theorganizations in strategicHRP. An organisation will often tend to be tothe left or to the right on all continuarather than to the left on some andto the right on other, although there could beexceptions. A companycould be at one end of the extreme on some plan characteristics

and atthe other end on other.


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Organisational Growth Cycles and PlanningThe stage of an organizations growth can have considerable influenceon HRP. Small

organisations in the embryonic stage may not havepersonnel planning.Need for planning is felt when the organisation enters thegrowth stage. HR forecastingbecomes essential. Internal developmentof people also begins to receive attention inorder to keep up with thegrowth.A mature organization experiences less flexibility and variability.Growth slows down.The workforce becomes old as few younger peopleare hired. Planning becomes moreformalized and less flexible andinnovative. Issues like retirement and possibleretrenchment dominateplanning.Finally, in the declining stage HRP takes a different focus.Planning is done for layoff,retrenchment and retirement. Sincedecisions are often made serious financial and sales

shocks areexperienced by the organisation, planning is often in nature.Environmental UncertaintiesHR managers rarely have the privilege of operating in a stable andpredictableenvironment. Political, social and economic changes affectall organizations. Personnelplanners deal with environmentaluncertainties by carefully formulating recruitment,selection, andtraining and development policies and programmes.Balancingmechanisms are built int thr HRM programme through successionplanning,promotion channels, layoffs, flexitime, job sharing,retirement, VRS, and otherpersonnel related arrangements.Time HorizonsYet another major factor affecting personnel planning is the timehorizon. On one hand,there are short-term plans spanning six monthsto one year. On the other hand, thereare long-term plans which preadover three to twenty years. The exact time span,however, depends onthe degree of uncertainty prevailing in an organisations

environment.Plans for companies operating in an unstable environment, computersfor example,

must be for a short period. Plans for others whereenvironment is fairly stable, forexample a university plan, may be longterm. In general, the greater the uncertainty, theshorter the plans timehorizon and vice versa.Type and Quality of InformationThe information used to forecast personnel needs originates from amultitude of sources.A major issue in personnel planning is the type ofinformation which should be used inmaking forecasts.Closely related to the type of information is the quality of dataused. The quality and

accuracy of information depend upon the claritywith which the organisational decisionmakers have defined theirstrategy, organisational structure, budgets, production


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schedules and soforth. In addition, the HR department must maintain well-developedjob-analysis information and HR information systems(HRIS) thatprovideaccurate and timely data. Generally speaking, organisationsoperating in stableenvironments are in a better position to obtaincomprehensive, timely and accurateinformation because of longerplanning horizons, clearer definition of strategy and

objectives, andfewer disruptions.Nature of Jobs being FilledPersonnel planners must consider the nature of jobs being filled in theorganisation. Jobvacancies arise because of separations, promotionsand expansion strategies.It is easy to employ shop-floor workers, but a lot of sourcing isnecessary for hiringmanagerial personnel. It is, therefore, necessary forthe personnel department toanticipate vacancies, as far in advance aspossible, to provide sufficient lead time toensure that suitablecandidates are recruited.HUMAN RESOURCE INFORMATION SYSTEM(HRIS) TECHNIQUEHRIS is a systematic procedure of collecting, storing, maintaining,retrieving and andvalidating data needed by an organisation about itsHR. The HRIS is usually a part ofthe organisations largermanagement information system(MIS). The HRIS need not becomplexas even computerized but computerization has its own advantage ofprovidingmore accurate and timely data for decision making.HR information system is much more than computerizing the payrollor skill inventoryin organisation. It is an integrated approach aimed ataccelerating the decision-makingprocess concerning HR andimprovement of two-way communication. Softwarepackages such asHRMS ORACLE, People soft-HR and SAP-HR are available whicharerelevant for creating HRIS. The system is used in following areas:

Recruitments, particularly pre-employment application process Training need analysis HR planning, particularly in forecast techniques Payroll Skill inventory Career and succession planning Employee benefit administration and services Two-way communication in organistion HR personal data Job evaluation Compensation management Employee surveys

Areas of utilization of this technique are on the rise duringthecurrent decade. Manyorganization have reported huge savingsand improved decision-making in terms ofquality and speed. Forexample, Cheyron estimated that it saved to the tune of $2000peremployee consequent upon integration of employee informationthrough HRIS.

Philips Petroleum reported saving of over $100million by ensuring availability ofinformation needed directly tomanagers.


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HRIS is particularly useful to organisations whosegeographical spread is vast oremploying large manpower. HRIS,apart from using computers is meant to integrate theemployeerelated information in a meaningful fashion. HRIS also can beused forgenerating various reports and analyzing HRinformation with different permutationsand combinations todraw inferences not possible by manual operations.

Organisationsgenerally allow three types of accessibility of HR information,whichinclude: (1) information meant to all employees, (2)Information accessibility restrictedto managers and (3)information accessibility to only top managers. Employeeinteractiononline is also possible to receive services, communicatewith management and receivebulletins. One time investment onHRIS will dramatically increase effectiveness of HRmanagementand saves the more money than invested on it.Managerial ImplicationA number of organisations end up making a wrong or not veryrational decision becauseof limited information available withthem regarding HR. It is difficult for some

organisations toestablish exact strength of manpower on roll in a given day. Further, the rise of variables in HR data makes it impossible fororganisations to leavethe data uncomputerized and unprocessed.However, computerization of HR data is justa beginning in thedirection of HRIS creation. HRIS is a combination of factorsthatprovide timely, accurately, meaningfully, completely and in aconcise manner. SEPARATIONSSeparation occurs when an employee leaves the organisation.Why do separations occur? Reasons for employee separationsmay be voluntary orinvoluntary. In the former, initation forseparation is taken by the employee himself orherself. Where theemployer initates to separate an employee, it becomesinvoluntaryseparation. In the latter the employee enterains the feeling ofinjustice andseeks legal protection to undo it. Fig 2.1 shows bothvoluntary and involuntaryseparations.

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Factors Affecting HRP