human resource management - workforce planning
Objective of Workforce Planning
Workforce planning is one of the most important activities in a business.
It starts with analysis of the strategic position of the business. The results of this analysis then feed into a forecast of the required demand for labour by the business and how this is likely to be supplied. The final stage involves the creation and implementation of a human resources plan which aims to deliver the right number of the right people for the business.
How strategy feeds into the workforce plan
The strategic position and needs of the business have the most important influence on workforce planning: for example:
- Labour environment: what is happening to the size of the labour force? What key population and employment trends (e.g. the increasing number of women seeking part-time work; increasing numbers of people working on temporary or short-term contracts) affect the ability of the business to recruit staff? What provision needs to be made for employee pensions (particularly in the light of falling stock market values); what employment legislation
- Business objectives and scope of activities: what are the objectives of each business unit? What products are to be sold, in which markets; using what kind of distribution?
- Business location - where is the business located? How are the various business units, divisions, functions distributed across the various locations? What specialist skills are essential in each location? What are the workforce implications of decisions on business location?
- Timetables - to what extent do the strategic needs of the business require short-term changes in the workforce - or can change be achieved over a longer period. For example, are new retailing or distribution locations to be opened in the next 12 months that require staff?
Forecasting Workforce Demand
Putting a good Human Resources plan together requires a business to make a reasonably accurate forecast of workforce size. Key factors to consider in this forecast are:
- Demand for existing and new products
- Business disposals and product closures
- Introduction of new technology (e.g. new production equipment)
- Cost reduction programmes (most usually involve a reduction in staff numbers somewhere within the business)
- Changes to the business organisational structure
- Business acquisitions, joint ventures, strategic partnerships
Forecasting Workforce Supply
The starting point for estimating supply is the existing workforce: a business should take account of:
- Scheduled changes to the composition of the existing workforce (e.g. promotions; job rotation)
- Normal loss of workforce - e.g. through retirement, "normal" labour turnover
- Potential exceptional factors - e.g. actions of competitors that create problems of staff retention
By comparing the forecast workforce demand and supply - it is possible to compile a forecast of net workforce size. This then needs to be compared with the strategic requirements for the business. The result is the "workforce gap" (which be a forecast of too few or too many workers). The role of HRM is to close the gap!
HRM - Policies to Close the Workforce Gap
The key HRM activities to manage the workforce gap comprise:
- Recruitment plans (how many people, where, what type, how)
- Training plans
- Redundancy plans
- Staff Retention Plans (how the business intends to keep the staff it wants to retain)
tutor2u is the leading global publisher of e-learning resources for Economics, Business, Politics, Enterprise, Law, Sociology, Religious Studies and related subjects. Our materials are used by over 3,500 schools and colleges in the UK and in educational institutions in over 85 other countries. tutor2u offers a range of free and subscription-based materials - designed to support teachers and inspire students. The business also runs a popular series of student revision workshops and teacher conferences. tutor2u was named Online Learning Resource of the Year at the prestigious BETT Show - the World's leading educational show.
|
Privacy & terms of Use |
Contact us |
Teacher Newsletters & Subject Blogs |
