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Developing and Implementing Strategic HRM Plans

Human resource planning identifies the skills needed by an organization and assigns people to corresponding tasks. It involves environmental scanning, forecasting manpower needs, and analyzing gaps between demand and supply. The human resource management plan outlines strategies for determining needs, recruiting, selecting, training, compensating, and appraising employees based on the organization's strategic objectives. It is important for the HRM plan to be linked to the company's overall strategic plan and to be constantly monitored and updated in response to changes.

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Mariz Ocho
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49 views

Developing and Implementing Strategic HRM Plans

Human resource planning identifies the skills needed by an organization and assigns people to corresponding tasks. It involves environmental scanning, forecasting manpower needs, and analyzing gaps between demand and supply. The human resource management plan outlines strategies for determining needs, recruiting, selecting, training, compensating, and appraising employees based on the organization's strategic objectives. It is important for the HRM plan to be linked to the company's overall strategic plan and to be constantly monitored and updated in response to changes.

Uploaded by

Mariz Ocho
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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HUMAN RESOURCE MANAGEMENT

Chapter 2: Developing and Implementing Strategic HRM Plans

Human Resource Planning (HRP) identifies people with the right skills and assigns
them corresponding tasks in the company. Human Resource Planning is a critical
component in determining the organization’s manpower complement or the number of
people that are currently employed in the organization. The process involved in HRP are
the following:

1. Environmental Scanning – It is a crucial for a manager to find out the factors


currently affecting the labor market because this can affect the company’s
recruitment.

2. Forecasting and estimating the firm’s manpower complement – The status of


employment in the organization, specifically the number of regular and contractual
or temporary employees should be determined. Forecasting is done to identify the
demand for and supply of employees while considering the manpower
requirements the internal supply of employees, and possible external sources of
employees.
The external supply of employees is based on the pool of job applicants.
Information regarding this is provided by government offices such as the
Department of Labor and Employment and National Statistics Office or now called
Philippine Statistics Authority.

3. Gap Analysis – it is done to determine if there is a gap or difference between


demand and supply in human resources. If there is a shortage of workers, the firm
may opt to allow or encourage overtime work or hire temporary or contractual
workers. It may also choose to outsource and allow a third party to perform the
functions of unfilled positions.
If there is a surplus of employees, there may be a need to trim down their number
to achieve the desired manpower complement. When demand is equal to supply,
the current workforce is provided with further skills training. In some instances, the
company conducts job rotation where employees are allowed to work in different
jobs to gain additional work experience.

Strategic Planning

HRM Strategic Plan as the major objectives the organization wants to achieve, and
the HR Plan as the specific activities carried out to achieve the strategic plan. In other
words, strategic plan may include the long-term goals while the HR Plan may include
short-term objectives that are tied to overall strategic plan.
Writing HRM Plan
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?

The first part of an HR plan will consist of


determining how many people are needed. This step involves looking at company
operations over the last year and asking a lot of questions:

• Were enough people hired?


• Did you have to scramble to hire people at the last minute?
• What are the skills your current employees possess?
• What skills do your employees need to gain to keep up with technology?
• Who is retiring soon? Do you have someone to replace them?
• What are the sales forecasts? How might this affect your hiring?

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.
Knowing how many people to hire, what skills they should possess, and hiring them when
the time is right are major challenges in the area of recruiting. Hiring individuals who have
not only the skills to do the job but also the attitude, personality, and fit can be the biggest
challenge in recruiting. Depending on the type of job you are hiring for, you might place
traditional advertisements on the web or use social networking sites as an avenue
A head hunter is a person who specializes in matching jobs with people, and they
usually work only with high-level positions. Another option is to use an agency that
specializes in hiring people for a variety of positions, including temporary and permanent
positions.

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.

Tips in HRM Planning

1. Link HRM Strategic Plan to Company Plan


Understanding the nature of the business is key to being successful in creating a
strategic plan for HRM. Because every business is different, the needs of the business
may change, depending on the economy, the season, and societal changes in our
country. HR managers need to understand all these aspects of the business to better
predict how many people are needed, what types of training are needed, and how to
compensate people, for example. The strategic plan that the HR manager writes should
address these issues. To address these issues, the HR manager should develop the
departmental goals and HR plans based on the overall goals of the organization. In other
words, HR should not operate alone but in tandem with the other parts of the organization.
The HRM plan should reflect this.

2. Monitor the Plan Constantly


Oftentimes a great strategic plan is written, taking lots of time, but isn’t actually put into
practice for a variety of reasons, such as the following:

The plan wasn’t developed so that it could be useful.


The plan wasn’t communicated with management and others in the HRM department.
The plan did not meet the budget guidelines of the organization.
The plan did not match the strategic outcomes of the organization.
There was lack of knowledge on how to actually implement it.
There is no point in developing a plan that isn’t going to be used. Developing the
plan and then making changes as necessary are important to making it a valuable asset
for the organization. A strategic plan should be a living document, in that it changes as
organizational or external factors change. People can get too attached to a specific plan
or way of doing things and then find it hard to change. The plan needs to change
constantly or it won’t be of value

3. Measure It
A good strategic plan and HR plan should discuss the way “success” will be measured.
For example, rather than writing, “Meet the hiring needs of the organization,” be more
specific: “Based on sales forecasts from our sales department, hire ten people this quarter
with the skills to meet our ten job openings.” This is a goal that is specific enough to be
measured. These types of quantitative data also make it easier to show the relationship
between HR and the organization, and better yet, to show how HR adds value to the
bottom line. Likewise, if a company has a strategic objective to be a safe workplace, you
might include a goal to “develop training to meet the needs of the organization.” While
this is a great goal, how will this be measured? How will you know if you did what you
were supposed to do? It might be difficult to measure this with such a general statement.
On the other hand, a goal to “develop a safety training workshop and have all employees
complete it by the end of the year” is specific and can be measured at the end to determine
success.

4. Sometimes Change Is Necessary


It can be difficult to base an entire plan on forecasted numbers. As a result, an HRM
department that is willing to change quickly to meet the needs of the organization proves
its worthiness. Consider a sales forecast that called for fifteen new hires, but you find out
months later the organization is having a hard time making payroll. Upon digging deeper,
you find the sales forecasts were overexaggerated, and now you have fifteen people you
don’t really need. By monitoring the changes constantly (usually done by asking lots of
questions to other departments), you can be sure you are able to change your strategic
plan as they come.

5. Be Aware of Legislative Changes


One of the major challenges in HRM, as we discuss in Chapter 1 “The Role of Human
Resources”, is having an awareness of what is happening from a legal perspective.
Because most budgets are based on certain current laws, knowing when the law changes
and how it will affect department budgets and planning (such as compensation planning)
will create a more solid strategic plan. For example, if the minimum wage goes up in your
state and you have minimum wage workers, reworking the budget and communicating
this change to your accounting team is imperative in providing value to the organization.

Key Takeaways

• As has been the theme throughout this chapter, any HRM plan should be directly
linked to the strategic plan of the organization.
• A plan should be constantly updated and revised as things in the organization
change.
• A good strategic plan provides tools to determine whether you met the goal. Any
plan should have measurable goals so the connection to success is obvious.
• Changes in a strategic plan and in goal setting are necessary as the internal and
external environments change. An HR manager should always be aware of
changes in forecasts, for example, so the plan can change, too.
• Legislative changes may impact strategic plans and budgets as well. It’s important
to make sure HR managers are keeping up on these changes and communicating
them

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