Recruiting and Retaining People

Lecture 4 – Human Resourcing, Retention and

Planning

Human Resourcing, Retention and Planning

• CIPD (cited by Taylor, 2010: 2) define the purpose of resourcing and planning by arguing:

• “A major and fundamental objective of the HR function is the mobilisation of a workforce. Organisations can only function if they are able to assemble together teams of people with the necessary skills, attitudes and experience to meet their objectives. A further objective is then to retain effective performers for as long as possible. From time to time it is also necessary to dismiss people from organisations.”….

What is HR planning?

“… is the systematic and continuing process of analysing an organisation's human resource needs under changing conditions and integrating this analysis with the development of personnel policies appropriate to meet those needs. It goes beyond the development of policies on an individual basis by embracing as many aspects of managing people as possible with a key emphasis on planning to meet the skill and development needs of the future.” (IPM, 1992)

Manpower Planning • Was a rational top-down planning approach, used

in post-war period of stable growth• Manpower planning cycle (Hendry, 1995:191)

– Analysing current manpower resource– Reviewing labour utilization– Forecasting the demand for labour– Forecasting supply– Developing a manpower plan

• Suggest a linear or circular approach?• Gender specific language - manpower• HRP supposedly broader/more strategic/

continuous cycle rather than linear stages

Analysis and investigation

External labour market

Internal labour market

Organisational assessment

Corporate strategy

Forecasting

Planning and resourcing

Implementation and control

Demand Supply

HR imbalance – quantitative/qualitative

Working patterns; retention; health and safety; release; training and development; employment relations; organisation structure and development; recruitment and selection; equality of opportunity; pay and reward; performance management.

•Using HR techniques•Developing policies and reviewing practice•Utilising technology

Source: Williams in Leopold (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 31. (adapted from Bramham (1994)

Analysis and Investigation:External to the firm

• Political, e.g. political parties approaches

• Economic, e.g. interest rates, credit crunch

• Social, e.g. attitudes to discrimination

• Technological, e.g. use in the workplace

• Legislative, e.g. forthcoming new laws

• International, e.g. commercial regulation

• Environment, e.g. impact of green issues

• Demographic, e.g. age of workforceSource: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 32.

Analysis and Investigation:The Internal Labour Market

• Analysing employees– Number– Age profile– Skill levels– Demographic profile– Labour turnover

• Range of different measures

• Analysing employees– Absence levels– Performance levels– Productivity levels– Competences

• Personal competences• Management• Technical

Source: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 36.

Statistical Analysis

• Labour Turnover Index/Wastage AnalysisLeavers in year

x 100

Average number of

staff in post

• Stability Index/AnalysisNumber of staff with 1 year’s service

x 100

Number of staff employed exactly one

year before

Statistical Analysis

• Cohort Analysis– E.g. graduate trainees– Survival rate

• Retention Profile

• Replacement and Succession Planning/Internal Promotion Analysis

Entry cohort

Original Strength

Numbers surviving to end of year after engagement

Year 1 Year 2 Year 3 Year 4 Year 5

2003 40 35 28 26 22 20

2004 32 25 24 19 18 17

2006 48 39 33 30 25 23

2006 38 32 27 24 22 19

2007 42 36 30 26 23 21

Total 200 167 142 125 110 100

Average Survival Rate 100% 84% 71% 63% 55% 50%

PostCurrent

Postholder Ready now Ready Soon Ready Future

Sales Director D. Coutts F. Enfield J. Wilson

Regional Sales Manager North F. Enfield G. Roberts M. Smith S. Johnson

Regional Sales Manager South J. Wilson G. Roberts S. Johnson

Sales Manager (Scotland & NI) G. Roberts H. Sim

G. NeishM. Knowles

Sales Manager (North & Wales) M. Smith

H. SimP. Adam C. Fisher

Sales Manager (Midlands) S. Johnson

S. ThompsonG. Dunn N. Hughes

Sales Manager (South) M. Aitken

C. CameronW. Davidson

M. GreenS. Lewis

Organisational Assessment and Corporate Strategy

• Key areas– Organisational philosophy– Culture– Structure– Management philosophy– People-related costs– Effectiveness of HR policies and practices– Employee statistics

• Often subjective/based on judgement• Assumes ‘fit’ with external environment, between

business and HR strategy, across HR policiesSource: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 36.

Forecasting Supply and Demand

• Forecasting supply– Knowledge of current and future labour pool

• E.g. population, age distribution, skills levels, unemployment

• Forecasting demand– Quantitative

• Ratio-trend analysis

• Eco-centric modelling

• Work study

– Qualitative

• Managerial judgement

• Delphi technique

• Nominal Group technique• Source: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 38.

Planning and Resourcing• Outcomes

– Plans• Resourcing• Development• Retention• Flexibility• Remuneration• Downsizing• Productivity• Control and Management of Plans

Source: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 43.

Implementation and Control

• Using HR techniques

• Utilising technology– HR Information systems– IT literacy– Data protection– Individual and collective data

• Developing policies and reviewing practice– Role of HR and line

Source: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 43.

Uncertain times• Leopold (2004) argued that

– Today’s organisations need to be able to:• Align output with demand• Cope with change

– To do this they need• Flexibility• Cost-effectiveness

– How does HR planning function in very uncertain climate? More or less important?

– To what extent do we see evidence of more strategic HRM practice/use of HR Planning?

Evidence of HRP in Practice?

• Evidence not clear-cut on use/majority of employers do not seem to prioritise HRP in practice (Taylor, 2008)

• Formal HRP largely limited to future training needs, labour cost/productivity analysis, structural changes required to support new business plans (CIPD/Cowling and Walters, 1990)

• Less than 50% of employers undertook formal forecasts of supply and demand (CIPD/Cowling and Walters,1990)

• Reasons for above?– E.g. scepticism/fear about statistical analysis rather than

management judgement, HRP viewed as desirable but not essential, short-term outlook in UK industry, lack of accurate historical records/data in firms, … (Taylor, 2008)

Pros and Cons of HRP?

Pros of HRP (Taylor, 2008)• Organisations need awareness of external and internal

environment and of HR implications• Complex and turbulent external environment means

organisations need to plan even more/develop adaptable plans

• Useful for organisations/aid achievement of objectivesCons of HRP (Taylor, 2008)• Are accurate historical records available? Can accurate

forecasts be made based on past records/experiences?• More environmental complexity & turbulence complicates

and inhibits accurate forecasting & planning• Might not fit with new organisational structures e.g.

decentralisation, resourcing decisions in SBUs not in HQs