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HUMAN RESOURCES PLANNING

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HUMAN RESOURCES PLANNING

Human Resources Planning is the process by which an organization ensures that it has the right number and kinds of people at the right places , at the right time, capable of effectively and efficiently undertaking and completing those tasks that will help the organization achieve its overall objectives

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The TSS Case Study on HRP The case study is in two parts. We will do it one part at a time. Some terms:

◦ Offshore : Employees / Projects based out of India◦ Onsite : Employees / Projects based overseas normally at client location◦ Blended Rate : It is the weighted average billing rate that the company gets between offshore and

onsite, e.g. if there are 80 employees offshore getting billed at $25 per hour (average) and 20 employees onsite getting billed at $60 per hour (average), then the blended rate =

(25*80+20*60)/(80+20) per hour or $32 per hour.◦ Billed Nos. : the no. of employees who are getting billed◦ Billable Nos. : No. of employees who can get billed◦ Utilisation = Billed man-hours/Billable man-hours◦ Attrition Rate : Rate of employees leaving the organisation. In a month if the average no. of employees

is 100 and if 3 people leave during the month, the attrition % for that month is 3%◦ Voluntary Attrition (VA) : % of employees who leave on their own accord. ◦ Involuntary Attrition (IVA) : % of employees who are asked to leave◦ Lateral : An employee with work experience◦ Fresher : An employee with no work-ex.

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The TSS Case Study on HRP

Having studied the HRP exercise versions 1 & 2 what needs to be done to make the planning more accurate:◦ Revenue planning needs to be done at the vertical/geo levels ◦ Within that at client level including expected new clients, new projects ◦ Offshore/Onsite breakups to be considered – new projects will have higher

onsite components to start with◦ Revenues to be classified at EE/EN and NN categories◦ Manpower computations to be done at drilled down levels◦ Manpower to be classified by assuming offshore ratios at 1 PM : 3 PLs : 8 SW

engineers.◦ Onsite ratios would have to computed on case to case basis◦ Close monitoring of plans on a quarterly basis needs to be done◦ Process needs to be automated

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Importance of HRP

1)Each Organisation needs personnel with necessary qualifications, skills, knowledge, experience & aptitude .

2)Need for Replacement of Personnel - Replacing old, retired or disabled personnel.

3)Meet manpower shortages due to labour turnover – Several Indian PSU’s headless for 6 -10 months.

4)Meet needs of expansion / downsizing programmes - As a result of expansion of IT companies the demand for IT professionals are increasing. PSU’s offering VRS to employees to retrench staff and labour costs.

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Importance of HRP

1)Each Organisation needs personnel with necessary qualifications, skills, knowledge, experience & aptitude .

2)Need for Replacement of Personnel - Replacing old, retired or disabled personnel.

3)Meet manpower shortages due to labour turnover – Several Indian PSU’s headless for 6 -10 months.

4)Meet needs of expansion / downsizing programmes - As a result of expansion of IT companies the demand for IT professionals are increasing. PSU’s offering VRS to employees to retrench staff and labour costs.

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A Model for A Model for Human Human Resource Resource PlanningPlanning

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Forecasting the Demand for Forecasting the Demand for Labor: Judgmental MethodsLabor: Judgmental Methods

◦ Bottom-Up (Unit) Forecasting In this method managers do the forecasting at Unit Level Care has to be taken to eliminate exaggeration bias and

duplication◦ Top-Down Forecasting

Senior Managers collectively assess best case & worst case scenarios and arrive at a most likely scenario

◦ Delphi Technique In this technique the experts do not meet face to face Each is given questionnaire for forecasting and reasons thereof The responses are collated and recirculated with another set of

questions Process is done anonymously and within a few rounds the

responses tend to converge

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Forecasting the Demand Forecasting the Demand for Labor: Mathematical for Labor: Mathematical MethodsMethods

◦ Productivity Ratio Average no. Of units produced per direct unit of

labour◦ Staffing Ratios

Based on direct manpower deriving the indirect manpower

◦ Multiple Regression Can be applied when sufficient historical data

exists to determine regression weights◦ Linear, or Goal Programming

Optimal staffing levels based on a given set of constraints

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Program Planning OptionsProgram Planning Options

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Other uses of HRPOther uses of HRP

i)quantify job for producing product / serviceii) quantify people & positions required iii) determine future staff-mix iv) assess staffing levels to avoid unnecessary

costsv) reduce delays in procuring staff vi) prevent shortage / excess of staff vii) comply with legal requirements

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Assessing Current Human Resources

• Human Resource Inventory• Name• Education• Skills with skill levels• Prior Experience• Training• Current Position & Role• Performance Ratings• Last Promotion Date• Current Reporting Manager• Current Location• Current Grade • Current Salary

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Assessing Current Human Resources

• Most companies use an HRIS• Larger Companies use ERP’s like SAP,

Peoplesoft etc.• MIS relating to HRIS are built around the HRIS• Some organizations also do succession

planning using HRIS for expected seperations (retirements/ resignations) and planned internal movements

• HRIS is also used for determining training needs

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Assessing where the organization is going• Revenue Projections• Products and Services Mix in the projection• Location based mix of the projections• Sometimes limitations in skill supply also

determines the revenue projections and product/services mix

• R & D Projections of the company • Non revenue generating Human resources

Projections

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Implications of Future Demand

• Necessary to perform an analysis for every significant job level and type on a Year-by-Year, Quarter-by-Quarter or Month-by-Month basis

• Has to be done on skills basis• Need to identify the type of demand, e.g., if

for a short duration of 3 -6 months we can look at temporary hires

• Companies policies and philosophy on FTEs & Contractors

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Implications of Future Supply

• Increasing Supply • New Hires• Transfers In• Long Leave Returnees

• Decreasing Supply• Voluntary & Involuntary Attritions• Retirements• Transfer- Outs• Sabbaticals

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Implications of Future Supply

• Changes in external supply• Increasing trends in availability of fresh graduates/post

graduates from colleges• Organizations have to tie up with colleges to make the college

education more useful to meet their skill needs• With recessionary trends, part time job seekers like students,

housewives• Non-availability of resources with Obsolescent skills• Non-availability of resources with high-end skills or multiple

skills

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Internal SupplyInternal SupplyInflows & Outflows - The number of losses & gains of staff

is estimated.

Turnover/Attrition Rate - refers to rate of employees leaving.= ( No. of separations in a year / Avg no. of employees during the year ) x 100

Absenteeism - unauthorised absence from work.= ( total absentees in a year / Avg no. of employees x No. of working days) x 100

Productivity Level = Output / Input. Change in productivity affects no. of persons per unit of output.

Movement among Jobs - internal source of recruitment, selection and placement

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External SupplyExternal Supply External recruitment, selection & placement -

Advertisements, Manpower Consultants, Campus Recruitment, Unsolicited Applications, Employee Referrals, e-recruitment,

Yield ratios - are estimated in the process of hiring applications.

Hiring Process Ratio Ad generates 2000 applications. 200 are potential 10:1 Out of 200, 40 attend interview 5:1 Out of 40, 30 were offered jobs 4:3 Out of 30, 25 accepted 3:2.5 Out of 25, 20 joined 2.5:2 Overall Yield Ratio (2000:20) 100:1

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JOB ANALYSIS

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Job AnalysisJob AnalysisThe process of

getting detailed information about

jobs.

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Job DescriptionsJob Descriptions• Job Description: a list of tasks, duties,

and responsibilities (TDRs) that a particular job entails.

• Key components:– Job Title– Brief description of the TDRs– List of the essential duties with detailed

specifications of the tasks involved in carrying out each duty

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Sample Job DescriptionSample Job Description

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Job SpecificationsJob Specifications• Job Specification: a list of the knowledge, skills,

abilities, and other characteristics (KSAOs) that an individual must have to perform a particular job.– Knowledge: factual or procedural information

necessary for successfully performing a task.– Skill: an individual’s level of proficiency at

performing a particular task.– Ability: a more general enduring capability

that an individual possesses.– Other Characteristics: job-related licensing,

certifications, or personality traits.

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Sample Job SpecificationsSample Job Specifications

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Types of Information Types of Information CollectedCollected

Work activities

Human behaviors

Human requirements

Job context

Machines, tools, equipment, and

work aids

Performance standards

Information Collected Via Job Analysis

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Use of Job Analysis Use of Job Analysis InformationInformation

Recruitment and Selection

CompensationLegal

Compliance

Discovering Unassigned

Duties

Performance Appraisal

Training

Information Collected Via Job Analysis

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Process Chart for Analyzing a Job’s Workflow

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Steps in Job AnalysisSteps in Job Analysis

1

2

3

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5

Steps in doing a job analysis:

Review relevant background information.

Decide how you’ll use the information.

Select representative positions.

Actually analyze the job.

Verify the job analysis information.

6 Develop a job description and job specification.

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Methods of Collecting Job Analysis Methods of Collecting Job Analysis Information: The InterviewInformation: The Interview

Information Sources◦ Individual employees◦ Groups of employees◦ Supervisors with

knowledge of the job Advantages

◦ Quick, direct way to find overlooked information

Disadvantages◦ Distorted information

Interview Formats◦ Structured (Checklist)◦ Unstructured

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Job Analysis: Interviewing Job Analysis: Interviewing GuidelinesGuidelines The job analyst and supervisor should work together to

identify the workers who know the job best. It is advisable to quickly establish rapport with the

interviewee. Follow a structured guide or checklist, one that lists open-

ended questions and provides space for answers. Ask the worker to list his or her duties in order of

importance and frequency of occurrence. After completing the interview, review and verify the data.

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Methods of Collecting Job Analysis Methods of Collecting Job Analysis Information: QuestionnairesInformation: Questionnaires

Information Source◦ Have employees fill out

questionnaires to describe their job-related duties and responsibilities

Questionnaire Formats◦ Structured checklists◦ Open-ended questions

Advantages◦ Quick and efficient way

to gather information from large numbers of employees

Disadvantages◦ Expensive and time

consuming in preparing and testing the questionnaire

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Methods of Collecting Job Analysis Methods of Collecting Job Analysis Information: ObservationInformation: Observation

Information Source◦ Observing and noting

the physical activities of employees as they go about their jobs

Advantages◦ Provides first-hand

information◦ Reduces distortion of

information Disadvantages

◦ Time consuming◦ Difficulty in capturing

entire job cycle◦ Of little use if job

involves a high level of mental activity

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Methods of Collecting Job Analysis Methods of Collecting Job Analysis Information: Participant Information: Participant

Diary/LogsDiary/Logs Information Source

◦ Workers keep a chronological diary/ log of what they do and the time spent on each activity

Advantages◦ Produces a more

complete picture of the job

◦ Employee participation Disadvantages

◦ Distortion of information◦ Depends upon

employees to accurately recall their activities

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Writing Job DescriptionsWriting Job DescriptionsJob

Identification

JobSummary

Responsibilities and Duties

Authority of the Incumbent

Standards of Performance

Working Conditions

JobSpecifications

Sections of a Typical Job Description

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The Job DescriptionThe Job Description Job Identification

◦ Job title◦ Preparation date◦ Preparer

Job Summary◦ General nature of the job◦ Major functions/activities

Relationships ◦ Reports to:◦ Supervises:◦ Works with: ◦ Outside the company:

Responsibilities and Duties◦ Major responsibilities

and duties (essential functions)

◦ Decision-making authority

◦ Direct supervision◦ Budgetary limitations

Standards of Performance and Working Conditions◦ What it takes to do the

job successfully

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Writing Job SpecificationsWriting Job Specifications

Specifications for Trained Versus

Untrained Personnel

Specifications Based on Statistical Analysis

“What traits and experience are required

to do this job well?”

Specifications Based on Judgment

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Writing Job Descriptions Writing Job Descriptions (continued)(continued)Step 1. Decide on a Plan

Step 2. Develop an Organization Chart

Step 3. Use a Job Analysis/Description Questionnaire

Step 4. Obtain Lists of Job Duties

Step 5. Compile the Job’s Human Requirements

Step 6. Complete Your Job Description

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The Skills Matrix for One Job at BP

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Writing Job Specifications Writing Job Specifications (continued)(continued)

Steps in the Statistical Approach◦ Analyze the job and decide how to measure job

performance.◦ Select personal traits that you believe should

predict successful performance.◦ Test candidates for these traits.◦ Measure the candidates’ subsequent job

performance.◦ Statistically analyze the relationship between the

human traits and job performance.

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Job Analysis in a Job Analysis in a “Jobless” World“Jobless” World

JobEnlargement

Job Enrichment

Job Design:Specialization and

Efficiency?

Job Rotation

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Job Analysis in a “Jobless” Job Analysis in a “Jobless” World (continued)World (continued)

Flattening the Organization

Reengineering Business

Processes

Dejobbing the Organization

Using Self-Managed Work

Teams

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Designing Jobs That Motivate: Designing Jobs That Motivate: The Job Characteristics ModelThe Job Characteristics Model1. Skill variety – the extent to which a job

requires a variety of skills to carry out the tasks involved.

2. Task identity – the degree to which a job requires completing a “whole” piece of work from beginning to end.

3. Task significance – the extent to which the job has an important impact on the lives of other people.

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Designing Jobs that Motivate: Designing Jobs that Motivate: The Job Characteristics ModelThe Job Characteristics Model4. Autonomy – the degree to which the job

allows an individual to make decisions about the way work will be carried out.

5. Feedback - the extent to which a person receives clear information about performance effectiveness from the work itself.

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Characteristics of a Motivating Characteristics of a Motivating JobJob

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Designing Jobs That Motivate Designing Jobs That Motivate

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Designing Jobs That MotivateDesigning Jobs That Motivate

Job Enrichment• Empowering workers by

adding more decision-making authority to jobs.

• Based on Herzberg’s theory of motivation.

• Individuals are motivated more by the intrinsic aspects of work.

Self-Managing Work Teams• Have authority for an

entire work process or segment:– schedule work– hire team members– resolve team

performance problems– perform other duties

traditionally handled by management

• Team members motivated by autonomy, skill variety, and task identity.

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Designing Jobs That Motivate Designing Jobs That Motivate Flexible Work SchedulesFlexible Work Schedules

Flextime• A scheduling policy in

which full-time employees may choose starting and ending times within guidelines specified by the organization.

• A work schedule that allows time for community and family interests can be extremely motivating.

Job Sharing• A work option in which two

part-time employees carry out the tasks associated with a single job.

• Enables an organization to attract or retain valued employees who want more time to attend school or take care of family matters.

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AlternativAlternatives to the es to the 8-to-5 Job8-to-5 Job

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Designing Jobs That Motivate Designing Jobs That Motivate TeleworkTelework• Telework – the broad term for doing

one’s work away from a centrally located office.

• Advantages to employers include:– less need for office space– greater flexibility to employees with special needs

• Easiest to implement for managerial, professional, or sales jobs.

• Difficult to set up for manufacturing workers.

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Competency-Based Job AnalysisCompetency-Based Job Analysis Competencies

◦ Demonstrable characteristics of a person that enable performance of a job.

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•A competency is an underlying characteristic of a person, which enables him to deliver superior performance in a given job, role or a situation

•This characteristic may be called an “attribute bundle” consisting of knowledge, skills, traits, social role, self image and motive. The “underlying characteristic” manifests itself in the form of behaviour, which helps identification and measurement of the competency

What is a Competency?

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Personality(Traits, Motives, Attitudes & Values)

Hard SkillsSoft Skills

Job Knowledge

What is a competency? – The Iceberg What is a competency? – The Iceberg ModelModelA bundle of skills, knowledge and attitudes required for superior performance

Hidden

Visible

Difficult to Develop

Easier to Develop

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Set of SKILLSRelates to the ability to do,

Physical domain

AttributeRelates to qualitative

aspects

Personal Characteristics

or traits

KNOWLEDGERelates to

information

Cognitive Domain

COMPETENCY

Outstanding Performance of tasks

or activities

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Competency-Based Job AnalysisCompetency-Based Job Analysis Reasons for Competency-Based

Job Analysis◦ To support a high-performance work system.◦ To create strategically-focused job descriptions.◦ To support the performance management process

in fostering, measuring, and rewarding: General competencies Leadership competencies Technical competencies

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Competency-Based Job AnalysisCompetency-Based Job Analysis

How to Write Job Competencies-Based Job Descriptions◦ Interview job incumbents and their supervisors

Ask open-ended questions about job responsibilities and activities.

Identify critical incidents that pinpoint success on the job.

◦ Use off-the-shelf competencies databanks