THE CONCEPT OF BEST FIT

EMPLOYEE
HR PLANNING ,
FORECASTING,RECTUITMENT
UNIT 2
 Introduction
Human resource planning is a process by which an
organization ensures that

– it has the right number and kinds of people

– at the right place

– at the right time

– capable of effectively and efficiently completing those tasks that will help
the organization achieve its overall strategic objectives
 HUMAN RESOURCE PLANNING

• Right number of people with right skills at right place at right

time to implement organizational strategies in order to
achieve organizational objectives
• In light of the organization’s objectives, corporate and
business level strategies, HRP is the process of analyzing an
organization’s human resource needs and developing plans,
policies, and systems to satisfy those needs
• Setting human resource objectives and deciding how to meet
them
• Ensuring HR resource supply meets human resource
demands
 Introduction

HR planning must be

• linked to the organization’s overall strategy to

compete domestically and globally

• translated into the number and types of workers

needed

Senior HRM staff need to lead top management in

planning for HRM issues.
 An Organizational Framework
A mission statement defines what business the
organization is in, including
– why it exists

– who its customers are

– strategic goals set by senior management to establish targets for

the organization to achieve
During a corporate assessment,

– SWOT (Strengths-Weaknesses-Opportunities-Threats) analysis

determines what is needed to meet objectives

– strengths and weaknesses and core competencies are identified

 Linking Organizational Strategy to HR Planning
STRATEGIC DIRECTION HR LINKAGE

mission determining organization’s

business

setting goals and objectives

objectives and goals

strategy determining how to attain

goals and objectives

determining what jobs need to be

structure
done and by whom

matching skills, knowledge, and

people abilities to required jobs
 Linking Organizational Strategy to HR Planning

Succession planning includes the development of

replacement charts that

• portray middle- to upper-level management

positions that may become vacant in the near
future

• list information about individuals who might

qualify to fill the positions
 Linking Organizational Strategy to HR Planning

HR must forecast staff requirements.

– HR creates an inventory of future staffing needs

for job level and type, broken down by year

– forecasts must detail the specific knowledge,

skills, and abilities needed, not just “we need 25
new employees”
 Linking Organizational Strategy to Human Resource Planning

HR predicts the future labor supply.

– a unit’s supply of human resources comes from:

• new hires
• contingent workers
• transfers-in
• individuals returning from leaves

– predicting these can range from simple to

complex

– transfers are more difficult to predict since they

depend on actions in other units
 Linking Organizational Strategy to HR Planning
Decreases in internal supply come about through:

 retirements easiest to forecast

 dismissals possible to forecast

 transfers possible to forecast

 layoffs possible to forecast

 sabbaticals possible to forecast

 voluntary quitsdifficult to forecast

 prolonged illnesses difficult to forecast

 deaths hardest to forecast

 Linking Organizational Strategy to HR Planning
Employment Planning and the Strategic Planning Process

demand for labor Outcomes

demand exceeds recruitment

assess current supply
define establish human resources compare demand
organization corporate goals -- - - - - - - - - - - - - for and supply of
mission and objectives HRMS: human resources
job analysis supply exceeds
demand decruitment

supply of
human resources
 Example of the Basic Human
Resources Planning Model

1 2 3
Organization Human Resource Human Resource Feasibility
Requirements Programs
al Objectives Analysis
4

5
 HRIS – HR INFORRMATION SYSTEM
• A human resource information system (HRIS) is software that provides
a centralized repository of employee master data that the human
resource management (HRM) group needs for completing core human
resource (core HR) processes. An HRIS can help HR and organizations
become more efficient through the use of technology.
• An HRIS stores, processes and manages employee data, such as names,
addresses, national IDs or Social Security numbers, visa or work permit
information, and information about dependents. It typically also
provides HR functions such as recruiting, applicant tracking, time and
attendance management, performance appraisals and
benefits administration. It may also offer employee self-service
functions, and perhaps even accounting functions.
• In some ways, an HRIS can be considered a smart database of employee
information. The interaction of the data, the processes that can be
performed and the reporting capabilities make the data stored in the
system more accessible and usable.
• HRIS benefits
• HRIS software can breathe new life into a company's HR
processes and procedures. While the benefits may vary
depending on the system a company opts for or the
modules they choose, the following are the key benefits
of HRIS software:
• Expedites tasks. .
• Reduces paperwork.
• Simplifies predictive analysis and visualizations.
• Empowers employees.
• Improves productivity.
• Maintains compliance.
• Offers security and privacy.
• HRIS functions
• As an HR tool, an HRIS usually features modules to handle the
following tasks:
• master data management (MDM);
• organizational management, such as positions and departments;
• employee and manager self-services;
• absence and leave management;
• benefits administration;
• workflows;
• performance appraisals;
• recruiting and applicant tracking;
• compensation management;
• training tracking as opposed to a learning management system (LMS)
and organizational development; and
• reporting and basic analytics.
 strategic workforce planning tools

• Strategic workforce planning map

• 9-Box grid The 9-box grid is an individual assessment tool that
evaluates an employee's current and potential level of contribution to the
organization. ... The 9-box grid is most commonly used in succession planning
as a method of evaluating an organization's current talent and identifying
potential leaders.
• HR dashboardingA HR dashboard is an advanced analytics tool that displays
important HR metrics using interactive data visualizations. It helps
the HR department to improve recruiting processes, optimize the workplace
management as well as to enhance the overall employee performance

• Compensation and benefits analysis (SS)

• Scenario planning (SS)
STRATEGIC WORKFORCE PLANNING MAP
9 box model
HR DASHBOARD
 Human Resource Forecasting
• Process of projecting the organization’s
future HR needs (demand) and how it will
meet those needs (supply) under a given set of
assumptions about the organization’s policies
and the environmental conditions in which it
operates.

• Without forecasting cannot assess the disparity

between supply and demand nor how effective
an HR program is in reducing the disparity.
 Forecasting as a Part of SUPPLY
HRP
Choose human FORECASTING
DEMAND
resource programs
FORECASTING

Determine
Internal programs External programs
organizational
objectives •Promotion • Recruiting
• External selection
•Transfer
• Executive
•Career planning exchange
Demand •Training
forecast for •Turnover control
each objective

Aggregate Internal supply forecast External supply forecast

demand
Does aggregate
forecast
supply meet Aggregate
aggregate supply forecast
demand? No

Yes

Go to feasibility analysis steps

 Internal Supply Forecasting
Information

• Organizational features (e.g.,

staffing capabilities)
• Productivity - rates of productivity,
productivity changes
• Rates of promotion, demotion,
transfer and turnover
 External Supply Forecasting
Information
• External labor market factors
(retirements, mobility, education,
unemployment)
• Controllable company factors on external
factors (entry-level openings, recruiting,
compensation)
 Demand Forecasting
Information
• Organizational and unit strategic plans
• Size of organization
• Staff and Managerial Support
• Organizational design
 Demand Forecasting Methods

• Delphi Method
• Staffing Table Approach
• Regression Analysis
• Time Series Analysis
• Linear Programming

SELF STUDY
 Supply Forecasting Methods

• Skills Inventory
• Replacement Charts
• Succession Planning
• Flow Modeling/Markov Analysis
• Computer Simulations
• SELF STUDY
 Job Analysis
Job analysis is a systematic exploration of the
activities within a job.

– it defines and documents the duties,

responsibilities, and accountabilities of a job
and the conditions under which a job is
performed
 Job Analysis
Job analysis methods
1. observation– job analyst watches employees directly or reviews film of
workers on the job
2. individual interview– a team of job incumbents is selected and
extensively interviewed
3. group interview– a number of job incumbents are interviewed
simultaneously
4. structured questionnaire– workers complete a specifically designed
questionnaire
5. technical conference– uses supervisors with an extensive knowledge
of the job
6. diary– job incumbents record their daily activities

The best results are usually achieved with some combination of methods.
 Job Analysis

understand the purpose review draft

of the job analysis with supervisor

understand the roles of

develop draft
jobs in the organization

benchmark positions seek clarification

determine how to collect

job analysis information
 Job Analysis
Job descriptions list:
– job title
– job identification
– job duties/essential functions in order of importance
– job specifications - minimal qualifications for job

They are critical to:

 describing job to candidates
 guiding new-hires
 developing performance evaluation criteria
 evaluating job’s compensation worth
• O*Net Model: The Occupational Information Network (O*NET) is a free online database that contains
hundreds of occupational definitions to help students, job seekers, businesses and workforce
development professionals to understand today's world of work in the United States.
• FJA Model: FJA stands for Functional Job Analysis and helps in collecting and recording job-related data
to a deeper extent. It is used to develop task-related statements. Developed by Sidney Fine and his
colleagues, the technique helps in determining the complexity of duties and responsibilities involved in a
specific job. This work-oriented technique works on the basis of relatedness of job-data where
complexity of work is determined on a scale of various scores given to a particular job. The lower scores
represent greater difficulty.
• PAQ Model: PAQ represents Position Analysis Questionnaire. This well-known and commonly used
technique is used to analyze a job by getting the questionnaires filled by job incumbents and their
superiors. Designed by a trained and experienced job analyst, the process involves interviewing the
subject matter experts and employees and evaluating the questionnaires on those bases.
• F-JAS Model: Representing Fleishman Job Analysis System, it is a basic and generic approach to discover
common elements in different jobs including verbal abilities, reasoning abilities, idea generation,
quantitative abilities, attentiveness, spatial abilities, visual and other sensory abilities, etc.
• Competency Model: This model talks about the competencies of employees in terms of knowledge,
skills, abilities, behaviors, expertise and performance. It also helps in understanding what a prospective
candidate requires at the time of entry in an organization at a particular designation in a given work
environment and schedule.
• Job Scan: This technique defines the personality dynamics and suggests an ideal job model. However, it
does not discuss the individual competencies such as intellect, experience or physical and emotional
characteristics of an individual required to perform a specific job.
 Job Analysis vs Other HR functions
Almost all
HRM
activities recruiting
are tied to labor selection
relations
job
analysis; it
is the
starting HR
point for safety &
planning
health
sound
HRM. job analysis
job description
job specifications employee
compensation development

performance employee
management training
career
development
 Hiring the Right Person: Recruitment

• RECRUITMENT
– The process of attracting individuals in sufficient
numbers with the right skills and at appropriate
times to apply for open positions within the
organization.

©SHRM 2008 36
When HR planning indicates the need for additional labor,
organizations have a number of choices to make.

a. This may be the first step in a full-scale recruitment and

selection process but sometimes hiring additional employees is
not the best method to obtain additional labor.
b. It may be practical for an organization to consider alternatives
to recruiting such as outsourcing or contingent labor. If
this is a temporary fluctuation in work volume, the simplest
solution may be part-time labor or overtime by existing
employees.
c. Since the costs of recruitment and selection can be
staggering, hiring new employees should occur only after
careful consideration and only when the organization
anticipates a long-term need for additional labor. Estimates of
the cost to replace supervisory, technical and management
employees run from 50 percent to several hundred percent of
their salaries
 Recruitment Issues
• Alternatives to recruitment:
– Outsourcing.
– Contingent labor(project based work – piece rate)
– Part-time employees.
– Overtime.

• Costs of recruitment and selection:

– Replacing supervisory, technical and management
personnel can cost from 50 percent of salary to several
hundred percent of salary.

©SHRM 2008 38
Human Resource Supply and Demand/factors
influencing recruitment
The recruitment and selection process
Employment
Employment
planning
planningand
and
forecasting
forecasting
Applicants
Applicants Utilize
Utilizevarious
various
Recruiting:
Recruiting: complete
complete techniques
techniquestoto
Build
Buildaapool
poolof
of application
application identify
identifyviable
viable
candidates
candidates forms
forms job
jobcandidates
candidates

Interview
Interviewfinal
final
candidates
candidatestoto
make
makefinal
final
choice
choice
 THE RECRUITMENT PROCESS
External Environment
Internal Environment
Human Resource Planning

Alternatives to Recruitment

Human Resource Planning

Internal Sources External Sources

Internal Methods External Sources

Recruited Individuals

41
External Sources and Methods of Recruitment
Sources Methods
• employee referral
• radio and television
programs
• newspapers and journals
• walk-ins
• computerized services
• other companies
• acquisitions and mergers
• employment agencies
• work flow management
• temporary help agencies
• trade associations and
unions
• schools
• foreign nationals
 Advantages & Disadvantages
of Sources of Applicants
INTERNAL SOURCES
• Advantages • Disadvantages
– Morale – Inbreeding
– Better assessment of abilities – Possible morale problems
– Lower cost for some jobs of those not promoted
– Motivator for good performance – political?infighting for
– Have to hire only at entry level promotions
– Requires strong
management development
program
 Advantages & Disadvantages
of Sources of Applicants
EXTERNAL SOURCES
• Advantages • Disadvantages
– new blood,new perspectives – May not select someone
– Cheaper than training a who will fit
professional – May cause morale
– No group of political supporters problems for those
in organization already internal candidates
– May bring competitors,secrets, – Longer adjustment or
new insights orientation time
– Helps meet equal employment – May bring in an attitude
from pervious Company.
needs
Recruiting Yield Pyramid
50 New hires
100 Offers made (2:1)
150 Candidates interviewed (3:2)
200 Candidates invited (4:3)
1,200 Leads generated (6:1)
 Succession Planning
Succession planning refers to the plans a company
makes to fill its most important executive positions.
It includes the following activities:
Analysis of the demand for managers and
professionals by company level, function, and skill.
Audit of existing executives and projection of likely
future supply from internal and external sources.
Planning of individual career paths based on
objective estimates of future needs and drawing on
reliable performance appraisals and assessments of
potential.
 Succession Planning
 Career counseling undertaken in the context of a
realistic understanding of the future needs of the
firm, as well as those of the individual.
 Accelerated promotions, with development
targeted against the future needs of the business.
 Performance-related training and development to
prepare individuals for future roles as well as
current responsibilities.
 Planned strategic recruitment not only to fill
short-term needs but also to provide people for
development to meet future needs.
Management Replacement
Chart Showing
Development Needs of
Future Divisional Vice
President

Figure 5–4
 Internal Environment

• Promotion from within:

– Advantages:
• Promotion as a reward for good work.
• Motivational tool for other employees.
• Promoted employee gets up to speed must
faster in his or her new job.
– Disadvantages:
• Must fill the position vacated by the
promoted employee.
• Lack of new ideas and creativity that may
come from a new person.
• Jealousy from those not promoted.
49
 Advantages & Disadvantages
of Sources of Applicants
INTERNAL SOURCES
• Advantages • Disadvantages
– Morale – Inbreeding
– Better assessment of abilities – Possible morale problems
– Lower cost for some jobs of those not promoted
– Motivator for good performance – political?infighting for
– Have to hire only at entry level promotions
– Requires strong
management development
program
 External Environment
• Labor market conditions:
– Strong economy = difficulty hiring.
– Weak economy = too many applicants.
The strength of the economy and labor market conditions will
significantly affect your organization’s ability to attract and
retain top-level employees. When the economy is strong
with little unemployment, you may have to compete with
other employers for a limited number of skilled employees.
This may require increased compensation or benefit
incentives to attract quality applicants. The reverse may be
true in a soft economy with high levels of unemployment.
The problem then is not a shortage of qualified applicants;
instead, the problem is managing a huge number of
applications that must be pared down to find a few
potential good hires. ©SHRM 2008 51
 Internal Recruitment
• Job Posting: The process of announcing job openings to employees.
• Job posting is the process of announcing job openings to all
employees. The announcement should contain information about the
position, the required qualifications and instructions for applying
– Job information must be made available to all
employees.
– Ensure minority workers and disadvantaged
individuals are aware of job opportunities.
– Employee cynicism occurs when there is not “equal”
opportunity for open positions.
• Employee Referrals:
– Some believe this is the route to the best
employees.
– Can perpetuate discriminatory
©SHRM 2008
hiring practices. 52
 External Recruitment

• Employment agencies.
• Executive search firms.
• In-house recruiters.
• Local advertising:
– Newspaper.
– Multimedia.
• Internships.
• Job fairs.
• College recruiting.
• Walk-in candidates.

©SHRM 2008 53
 Selection and Placement
• Selection
– The process of choosing individuals with
qualifications needed to fill jobs in an organization.
– Organizations need qualified employees to
succeed.
• “Hire hard, manage easy.”
• “Good training will not make up for bad selection.”

• Placement
– Fitting a person to the right job.
Copyright © 2005 Thomson Business 8–54
& Professional Publishing. All rights
Typical Division of HR Responsibilities: Selection

Figure 8–1
Copyright © 2005 Thomson Business 8–55
& Professional Publishing. All rights
Job Performance, Selection Criteria, and Predictors

Figure 8–2
Copyright © 2005 Thomson Business 8–56
& Professional Publishing. All rights
 Organization & Job Analysis Process

Organization Analysis

Recruitment Selection

Job Analysis
Selection
Process
Flowchart

Figure 8–3
 Stages of the Recruitment & Selection Process

Stages of The Recruitment and Selection Process

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5

Organiz- Identify and Narrow pool Further Further Decide

ation attract to minimally narrow pool narrow pool whom to
applicants qualified to those who to those who hire
applicants best fit the best fit job
job and
organization
Individual Identify and Narrow pool Further Further Decide
attract to minimally narrow pool narrow pool which job
organiz- acceptable to those who to those who offer to
ations organiz- best fit with have accept
ations needs/career desirable
goals jobs and
desirable
cultures
 Selection Tools
• Selection tools as predictors of job
performance
– Interviews – Structured & Unstructured (types –
SS)
– Assessment centers
– Drug tests
– Reference checks
– Background checks
– Handwriting analysis
 Selection Tools
• Personality Tests
– Extraversion
• The tendency to be sociable, assertive, active, and to experience
positive effects, such as energy and zeal.
– Emotional stability/neuroticism
• The tendency to exhibit poor emotional adjustment and experience
negative effects, such as anxiety, insecurity, and hostility.
– Openness to experience
• The disposition to be imaginative, nonconforming, unconventional,
and autonomous.
– Agreeableness
• The tendency to be trusting, compliant, caring, and gentle.
– Conscientiousness
• Is comprised of two related facets: achievement and dependability.
 Selection - Structured Job Interview
• Situational Interview Questions
– Supervisors and workers rewrite critical incidents of
behavior as situational interview questions then
generate and score possible answers as benchmark
• Job Knowledge Questions
– Assess whether or not candidate has the basic
knowledge needed to perform the job
• Worker Requirements Questions
– Assess whether or not worker is willing to perform the
job under prevailing job conditions
 Selection Methods
Initial Assessment Substantive Contingent
Methods Assessment Methods Assessment Methods

 Resumes & cover  Ability tests  Drug tests

letters  Personality tests  Medical exams
 Application blanks  Job knowledge tests
 Biographical  Performance tests &
information work samples
 Reference reports  Integrity tests
 Screening interviews  Interviews
 Evaluating Selection Methods
• Reliability
• Validity
• Utility
• Applicant reactions
• Adverse impact
 Characteristics of a Useful Selection
Method
• It is reliable.
• It is valid.
• Its benefits outweigh its costs.
• Applicants respond favorably to it.
• It does not screen out a disproportionate
number of legally protected group members.
 Selection: Decision Making
• Combining information
– compensatory
– noncompensatory
• Decision rules
– top-down ranking
– grouping
• Job offers
 Internet Recruiting
• Advantages:
– Inexpensive.
– Quick and easy to post announcement.
– Responses arrive faster and in greater quantity.
– Will generate a wider range of applicants.
– Applicants can be screened by computer.
– Some selection tests can be administered by
computer.
– Automated applicant tracking.
• Disadvantages:
– Ease of submission will result in a lot of applicants,
many whom are not qualified.
– May take more HR time to sort through the greater
quantity of applicants.
©SHRM 2008 67
 Recruitment for Diversity

• An ethnically diverse workforce enhances creativity and

may facilitate expansion into global markets.
• Recruiting must generate applicants from a wide variety of
individuals.
• Train recruiters to use objective standards.
• Include pictures of minority and disabled employees on
recruitment flyers.
• Make sure ads and interviews are bi-lingual.
• Many organizations recognize the inherent advantage
of a diverse workforce. Diverse employees bring
increased creativity to the organization and the ability
to help the firm expand into global markets.
©SHRM 2008 68
 HR Dilemma: Employee Referrals

An organization starts an employee referral program to find

employees for its assembly plant. The program is very
effective, but no candidates from protected groups are
referred or hired.

1. Could the organization be guilty of discrimination?

2. Should the organization abandon its referral program?

©SHRM 2008 69
 The Employment Application
• Applications must include:
– Applicant information.
– Applicant signature certifying validity of information.
– Statement of employment at will, if permitted.
– Permission from the applicant for reference check.
• Avoid the following:
– Discriminatory information.
– Citizenship and Social Security data.
– Information on past use of FMLA, ADA or Workers’
Compensation.
– Disability information.
– Past salary levels.
– Birth date or education dates.
– Driver’s license information, unless driving is a job requirement.

©SHRM 2008 70
• –Socialization benefits.

• SELF STUDY