What is Human Resource Planning?

Human Resource Planning is a process of forecasting and strategizing to meet the

organization’s demand and supply of manpower needs in the present and future. It is a
process to ensure that you have the right people with the right skillset in your team
thereby building a strong workforce capability in your organization.
No business strategy can succeed without an abled workforce that innovates and
competes to grow your organization. Human resource Planning helps to take care of any
critical shortages in manpower hence mitigating business risks.

Why we need Human Resource Planning?

Human Resource Planning is no science but an approach based on ideas and processes
that help to forecast and manage operations effectively. Before we study how we
can create a robust Human Resource Plan, let us understand and answer why we need it
and the benefits thereof.
The six parts of the HRM plan include the following:

1. Determine human resource needs. This part is heavily involved with the strategic plan. What
growth or decline is expected in the organization? How will this impact your workforce? What is
the economic situation? What are your forecasted sales for next year?
2. Determine recruiting strategy. Once you have a plan in place, it’s necessary to write down a
strategy addressing how you will recruit the right people at the right time.
3. Select employees. The selection process consists of the interviewing and hiring process.
4. Develop training. Based on the strategic plan, what training needs are arising? Is there new
software that everyone must learn? Are there problems in handling conflict? Whatever the
training topics are, the HR manager should address plans to offer training in the HRM plan.
5. Determine compensation. In this aspect of the HRM plan, the manager must determine pay
scales and other compensation such as health care, bonuses, and other perks.
6. Appraise performance. Sets of standards need to be developed so you know how to rate the
performance of your employees and continue with their development.

Meaning Human Resource Planning:

Human resource is the most important asset of an organisation. Human resources planning are
the important managerial function. It ensures the right type of people, in the right number, at the
right time and place, who are trained and motivated to do the right kind of work at the right time,
there is generally a shortage of suitable persons. The enterprise will estimate its manpower
requirements and then find out the sources from which the needs will be met. If required
manpower is not available then the work will suffer. Developing countries are suffering from the
shortage of trained managers. Job opportunities are available in these countries but properly
trained personnel are not available. These countries try to import trained skill from other
countries.
In order to cope human resource requirements, an enterprise will have to plan in advance
its needs and the sources. The terms human resource planning and manpower planning are
generally used interchangeably. Human resource planning is not a substitute for manpower
planning. Rather the latter is a part of the former i.e., manpower planning is integrated with
human resource planning.

Definition Human Resource Planning:

According to E.W. Vetter, human resource planning is “the process by which a management
determines how an organisation should make from its current manpower position to its desired
manpower position.
Human resource planning may be viewed as foreseeing the human resource requirements of an
organisation and the future supply of human resources and making necessary adjustments
between these two and organisation plans, and foreseeing the possibility of developing the
supply of human resources in order to match it with requirements by introducing necessary
changes in the functions of human resource management.
Here, human resource means skill, knowledge, values, ability, commitment, motivation etc., in
addition to the number of employees. Though accomplishment of organisational objectives and
goals is the primary concern of the human resource planning, concern for the aspirations of the
people and their well-being has equal importance in it. In fact, the human resources planning
must result in humanisation of work environment.
Features of Human Resource Planning:
1. Well Defined Objectives:
Enterprise’s objectives and goals in its strategic planning and operating planning may form the
objectives of human resource planning. Human resource needs are planned on the basis of
company’s goals. Besides, human resource planning has its own objectives like developing
human resources, updating technical expertise, career planning of individual executives and
people, ensuring better commitment of people and so on.
2. Determining Human Resource Needs:
Human resource plan must incorporate the human resource needs of the enterprise. The thinking
will have to be done in advance so that the persons are available at a time when they are
required. For this purpose, an enterprise will have to undertake recruiting, selecting and training
process also.
3. Keeping Manpower Inventory:
It includes the inventory of present manpower in the organisation. The executive should know
the persons who will be available to him for undertaking higher responsibilities in the near
future.
4. Adjusting Demand and Supply:
Manpower needs have to be planned well in advance as suitable persons are available in future.
If sufficient persons will not be available in future then efforts should be .made to start
recruitment process well in advance. The demand and supply of personnel should be planned in
advance.
5. Creating Proper Work Environment:
Besides estimating and employing personnel, human resource planning also ensures that working
conditions are created. Employees should like to work in the organisation and they should get
proper job satisfaction.
Difference between Recruitment and Selection

Definition of Recruitment
Recruitment is a process of finding out the prospective applicants and stimulating them to apply
for the vacancy. It is a long process which involves a series of activities that starts with analysing
the job requirements and ends on the appointment of the employee. The activities involved in the
recruitment of employees are as under:
• Analysing job requirement
• Advertising the vacancy
• Attracting candidates to apply for the job
• Managing response
• Scrutiny of applications
• Shortlisting candidates
The recruitment is done by the Human Resource managers either internally or externally. The
sources of internal recruitment are promotion, transfers, retrenched employees, contact or
references, ex-employees, retired employees, etc. On the other hand, sources of external
recruitment are recruitment through advertisement, campus recruitment, recruitment by
employment exchanges, recruitment by third parties (recruitment agencies), internet recruiting,
unsolicited applicants, etc.
Definition of Selection
Selection is an activity in which the organisation selects a fixed number of candidates from a
large number of applicants. It involves the actual appointment of the employee for filling up the
vacancies of the enterprise. The term selection means the placement of the right man at the right
job. We all know that a lot of people apply for a single job at the time of recruitment, in which
the recruiters have to decide which candidate fits the best for the job.
The selection also involves a set of activities which are given as under:
• Screening
• Eliminating unsuitable candidates
• Conducting the examination like aptitude test, intelligence test, performance test,
personality test, etc.
• Interview
• Checking References
• Medical Test

The process of selection is a time-consuming one because the HR managers have to identify the
eligibility of every candidate for the post. Besides this, the educational qualification, background,
age, etc. are also some of the most important factors in which they have to pay more attention.
After this, the written examination and interview is also a very tough task.
BASIS FOR
RECRUITMENT SELECTION
COMPARISON

Meaning Recruitment is an activity of Selection refers to the process of

searching candidates and selecting the best candidates and
encouraging them apply for it. offering them job.

Approach Positive Negative

Objective Inviting more and more candidates Picking up the most suitable
to apply for the vacant post. candidate and rejecting the rest.

Key Factor Advertising the job Appointment of the candidate

Sequence First Second

Process Vacancies are notified by the firm The firm makes applicant pass
through various sources and through various levels like
application form is made available to submitting form, written test,
the candidate. interview, medical test and so on.

Contractual As recruitment only implies the Selection involves the creation of

Relation communication of vacancies, no contractual relation between the
contractual relation is established. employer and employee.

Method Economical Expensive

What is a trade union?

A trade union is a group of employees who join together to maintain and improve their
conditions of employment. The typical activities of trade unions include providing assistance and
services to their members, collectively bargaining for better pay and conditions for all workers,
working to improve the quality of public services, political campaigning and industrial action.
Nearly seven million people in the UK belong to a trade union. Union members include nurses,
school meals staff, hospital cleaners, and professional footballers, shop assistants, teaching
assistants, bus drivers, engineers and apprentices. Most trade unions are independent of
employers but have close working relationships with them.

What trade unions do

Unions train and organise workplace representatives who help union members with the problems
they face at work. Provide support and advice and campaign for better conditions and pay.
Unions have brought significant changes to society, including:
1) a national minimum wage;
2) the abolition of child labour;
 3) improved worker safety;
4) improving living standards by reducing the number of hours in the working week and
encouraging a healthy work/life balance;
5) improved parental leave;
6) equality legislation;
7) better protection of migrant workers and a reduction in exploitation;
8) Minimum holiday and sickness entitlements.

Unions have also made thousands of local agreements on issues affecting individual workplaces
following consultation, negotiation and bargaining.

Why join a trade union?

In workplaces where there are unions, members benefit from the strength and security that comes
from working together to tackle problems.
Employees at unionized workplaces earn around 12.5% more than non-unionised workplaces.
The major benefits are:
1) better working conditions such as improved health and safety or pay;
2) training for new skills to help you develop your career;
3) advice on your legal employment rights;
4) advice on finance and problems at work.

Trade unions may also represent their members’ interests outside the workplace. For example,
trade unions may lobby the government or the European Union on policies which promote their
objectives.

Recognized trade unions

Workplaces in different sectors have recognised trade unions they choose to work with. You
should ask your employer which trade union they recognise.
If you belong to a trade union other than the one your employer recognises, your union may have
less say in issues that affect you in the workplace.

PLANT LOCATION AND SITE SELECTON:

The geographical location of the final plant can have strong influence on the success of the
industrial venture. Considerable care must be exercised in selecting the plant site, and many
different factors must be considered. Primarily the plant must be located where the minimum
cost of production and distribution can be obtained but, other factors such as room for expansion
and safe living conditions for plant operation as well as the surrounding community are also
important. The location of the plant can also have a crucial effect on the profitability of a project.
The choice of the final site should first be based on a complete survey of the advantages and
disadvantages of various geographical areas and ultimately, on the advantages and disadvantages
of the available real estate.
The various principal factors that must be considered while selecting a suitable plant site,
are briefly discussed in this section. The factors to be considered are:
1. Raw material availability.
2. Location (with respect to the marketing area.)
3. Availability of suitable land.
4. Transport facilities.
5. Availability of labors.
6. Availability of utilities (Water, Electricity).
7. Environmental impact and effluent disposal.
8. Local community considerations.
9. Climate.
10. Political strategic considerations.
11. Taxations and legal restrictions

RAW MATERIALS AVAILABILITY:

The source of raw materials is one of the most important factors influencing the selection of a
plant site. This is particularly true for the sulfuric acid plant because a large volume of sulfur is
consumed in the process which will result in the reduction of the transportation and storage
charges. Attention should be given to the purchased price of the raw materials, distance from the
source of supply, freight and transportation expenses, availability and reliability of supply, purity
of raw materials and storage requirements.

(1) LOCATION: The location of markets or intermediate distribution centers affects the cost of
product distribution and time required for shipping. Proximity to the major markets is an
important consideration in the selection of the plant site, because the buyer usually finds
advantageous to purchase from near-by sources. In case of sulfuric acid plant, the major
consumers are fertilizer industries and hence the plant should be erected in close proximity to
those units.

(2) AVAILABILITY OF SUITABLE LAND: The characteristics of the land at the proposed
plant site should be examined carefully. The topography of the tract of land structure must be
considered, since either or both may have a pronounced effect on the construction costs. The cost
of the land is important, as well as local building costs and living conditions. Future changes may
make it desirable or necessary to expand the plant facilities. The land should be ideally flat, well
drained and have load-bearing characteristics. A full site evaluation should be made to determine
the need for piling or other special foundations.

(3) TRANSPORT: The transport of materials and products to and from plant will be an
overriding consideration in site selection. If practicable, a site should be selected so that it is
close to at least two major forms of transport: road, rail, waterway or a seaport. Road transport is
being increasingly used, and is suitable for local distribution from a central warehouse. Rail
transport will be cheaper for the long-distance transport. If possible the plant site should have
access to all three types of transportation. There is usually need for convenient rail and air
transportation facilities between the plant and the main company headquarters, and the effective
transportation facilities for the plant personnel are necessary.
 (4) AVAILABILITY OF LABOURS: Labors will be needed for construction of the plant and its
operation. Skilled construction workers will usually be brought in from outside the site, but there
should be an adequate pool of unskilled labors available locally; and labors suitable for training
to operate the plant. Skilled tradesmen will be needed for plant maintenance. Local trade union
customs and restrictive practices will have to be considered when assessing the availability and
suitability of the labors for recruitment and training.

(5) AVAILABILITY OF UTILITIES: The word “utilities” is generally used for the ancillary
services needed in the operation of any production process. These services will normally be
supplied from a central facility and includes Water, Fuel and Electricity which are briefly
described as follows:

(i) Water: - The water is required for large industrial as well as general purposes, starting with
water for cooling, washing, steam generation and as a raw material in the production of sulfuric
acid. The plant therefore must be located where a dependable water supply is available namely
lakes, rivers, wells, seas. If the water supply shows seasonal fluctuations, it’s desirable to
construct a reservoir or to drill several standby wells. The temperature, mineral content, slit and
sand content, bacteriological content, and cost for supply and purification treatment must also be
considered when choosing a water supply. Dematerialized water, from which all the minerals
have been removed is used where pure water is needed for the process use, in boiler feed.
Natural and forced draft cooling towers are generally used to provide the cooling water require
on site.

(ii) Electricity: - Power and steam requirements are high in most industrial plants and fuel is
ordinarily required to supply these utilities. Power, fuel and steam are required for running the
various equipments like generators, motors, turbines, plant lightings and general use and thus be
considered as one major factor is choice of plant site.

(6) ENVIRONMENTAL IMPACT AND EFFLUENT DISPOSAL: Facilities must be provided

for the effective disposal of the effluent without any public nuisance. In choosing a plant site, the
permissible tolerance levels for various effluents should be considered and attention should be
given to potential requirements for additional waste treatment facilities. As all industrial
processes produce waste products, full consideration must be given to the difficulties and coat of
their disposal. The disposal of toxic and harmful effluents will be covered by local regulations,
and the appropriate authorities must be consulted during the initial site survey to determine the
standards that must be met.

(7) LOCAL COMMUNITY CONSIDERATIONS: The proposed plant must fit in with and be
acceptable to the local community. Full consideration must be given to the safe location of the
plant so that it does not impose a significant additional risk to the community.

(8) CLIMATE Adverse climatic conditions at site will increase costs. Extremes of low
temperatures will require the provision of additional insulation and special heating for equipment
and piping. Similarly, excessive humidity and hot temperatures pose serious problems and must
be considered for selecting a site for the plant. Stronger structures will be needed at locations
subject to high wind loads or earthquakes.
(9) POLITICAL AND STRATEGIC CONSIDERATIONS Capital grants, tax concessions, and
other inducements are often given by governments to direct new investment to preferred
locations; such as areas of high unemployment. The availability of such grants can be the
overriding consideration in site selection.

(10) TAXATION AND LEGAL RESTRICTIONS: State and local tax rates on property income,
unemployment insurance and similar items vary from one location to another. Similarly, local
regulations on zoning, building codes, nuisance aspects and others facilities can have a major
influence on the final choice of the plant site.

FACTORS AFFECTING PLANT LAYOUT. The final solution for a Plant Layout has to take
into account a balance among the characteristics and considerations of all factors affecting plant
layout, in order to get the maximum advantages. The factors affecting plant layout can be
grouped into 8 categories:

1) Materials
2) Machinery
3) Labor
4) Material Handling
5) Waiting Time
6) Auxiliary Services
7) The building
8) Future Changes

(I) Materials:
• The layout of the productive equipment will depend on the characteristics of the product
to be managed at the facility, as well as the different parts and materials to work on.
• Main factors to be considered: size, shape, volume, weight, and the physical-chemical
characteristics, since they influence the manufacturing methods and storage and material
handling processes.
• The sequence and order of the operations will affect plant layout as well, taking into
account the variety and quantity to produce.
(II) Machinery
• Having information about the processes, machinery, tools and necessary equipment, as
well as their use and requirements is essential to design a correct layout.
• The methods and time studies to improve the processes are closely linked to the plant
layout.
• Regarding machinery, we have to consider the type, total available for each type, as well
as type and quantity of tools and equipment.
• It’s essential as well to know about space required, shape, height, weight, quantity and
type of workers required, risks for the personnel, requirements of auxiliary services, etc.

(III) Labour
• Labor has to be organized in the production process (direct labor, supervision and
• Environment considerations: employees’ safety, light conditions, ventilation,
temperature, noise, etc.
 •
Process considerations: personnel qualifications, flexibility, number of workers required
at a given time as well as the type of work to be performed by them.
(iv) Material - Handling
• Material handling does not add value to the product; it’s just waste.
• Objective: Minimize material handling as well as combining with other operations when
possible, eliminating unnecessary and costly movements.
• The factors affecting plant layout can be grouped into 8 categories:

Waiting time –
• Stock Objective: Continuous Material Flow through the facility, avoiding the cost of
waiting time and demurrages that happen when the flow stops.
• On the other hand, the material waiting to flow through the facility not always represents
a cost to avoid. As stock sometimes provides safety to protect production, improving
customer service, allowing more economic batches, etc.
• It’s necessary then to consider space for the required stock at the facility when designing
the layout.
• Resting time to cool down or heating up…
(V) Auxiliary Services:
• Support the main production activities at the plant:
• Related to labor: Accessibility paths, fire protection installations, supervision, safety, etc.
Related to material: quality control.
• Related to machinery: maintenance and electrical and water lines.
• The auxiliary services represent around 30% of the space at a facility.
• The space dedicated to auxiliary services is usually considered as waste.
• It’s important to have efficient services to insure that their indirect costs have been
minimized.

(VI) The building If it has been already selected, its characteristics will be a constraint at the
moment of designing the layout, which is different if the building has to be built.

(I) Future changes:

• It’s important to forecast the future changes to avoid having an inefficient plant layout in
a short term.
• Flexibility can be reached keeping the original layout as free as possible regarding fixed
characteristics, allowing the adjustment to emergencies and variations of the normal
process activities.
• Possible future extensions of the facility must be taken into account, as well as the
feasibility of production during re-layout.
Product layouts are often used by companies that produce high volumes of standardized
products. The machines used in flow line production are often designed specifically for one
product, and may not be easily adapted to others.