17

Module II

HUMAN RESOURCE
PLANNING

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Human Resource Planning

Human Resource Planning is the process of estimating manpower
required for an organisation.
The firm ensures right number of people and the right kind of people
doing the right job at the right time.
 It is an integral part of human resource management
 It ensures optimum utilization of existing manpower
 It determines workforce requirement.
Need and Importance of HRP
1. Expansion of plant
With the expansion of plant there is need to recruit more number
of employees.
2. Retirement vacancies
There are retirement, death, absenteeism etc. of employees in an
enterprise. They are to be replaced by the new employees.
3. Reduction in labour turnover
Certain persons will have the organisation by way of dissatisfaction
or by getting a better job. New persons are to be appointed in their
place.
4. Reduction in labour cost
Cost of labour can be reduced through effective manpower
planning
5. To maintain good and effective employee – employer relationship
6. To introduce fresh people in the organisation – technological
developments induce the organisation to recruit new personnel.
7. To determine shortage or surplus staff.
Objectives of HR Planning
 Accurate assessment of manpower recruitment
 Optimum utilization of human resource
 Keeping working details of existing employees

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 Helpful in recruitment, selection and training

 To avoid interruption in production
 To assess surplus and shortage of human resources
 To meet the needs of expansion and diversification programs.
Types of Manpower Planning or HR Planning
1. Short term Manpower Planning
It is concerned with planning the immediate human resource
requirement of an organisation
It covers a period of one to two years
It is concerned with the process of adjusting the existing number
of employees and recruit new personnel due to legal constraints.
Management should adjust the existing available workers with
specific project and program.
2. Long term Manpower planning
It is concerned with planning the future manpower requirements
of the organisation. It covers a longer period, say 15 years.
Management will get sufficient time to make adjustment of
employees according to job specification.
Process of HR Planning
1. Preparation of manpower inventory
It is a detailed analysis of the existing manpower in terms of
number of employees, their capabilities, experiences and skills. It
is necessary to ascertain the number and quality of employees
available in the organisation.
2. Forecasting Manpower needs
Human resource requirements are forecasted on the basis of
production, sales budgets, workload analysis, labour turnover,
absenteeism etc.

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3. Preparation of manpower chart

The planners prepare different type of chart to project manpower
requirements.
4. Preparation of manpower plans
It must be prepared for a short period or for a long period.
5. Employment program
It includes the steps like recruitment, selection, placement,
performance appraisal, transfer and promotion.
Strategic Human Resource Planning
It may be defined as integrating the human resource planning with the
overall mission, strategies and objectives of the organisation.
Strategic plans deals with issues such as entering new markets,
developing new competencies and creating new product offering.
It is the process in which top management determine an organisation’s
overall purpose and objectives and how the organisation will achieve
these over time.
Difference between HR Planning and Strategic human Resource
Planning
HR Planning SHR Planning
It is very definite type of planning It is very broad
It focused on one area, ie the It focused on several
firm’s employees organisational issues
It is usually undertaken by a It is not developed by
manager managers but by specialised
planners

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Manpower Forecasting
It is the process of estimating the future quantity and quality of people
required on the basis of corporate and functional plans and future
activity levels.
Technique of Manpower Forecasting
1. Managerial judgement
Asper the method all the managers sit together, and prepare future
manpower requirements of their respective departments. It is done
on the basis of workload and efficiency of employees.
2. Ratio – Trend Analysis
Under this method different types of ratios related with forecasting
are done. On the basis of established ratios, the demand for
human resources is estimated.
3. Work – Study method
Time and motion study methods are used to analyse and measure
the work being done. The length of operations and the amount of
labour required can be ascertained under this method.
4. Mathematical Models
Mathematical models like regression, probabilistic model can be
used for forecasting manpower needs.

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CONCEPTS IN HRM
 Job analysis
 Job description
 Job Specification
 Job Design
 Job Evaluation
JOB ANALYSIS
It may be defined as the process of studying and collecting information
relating to a job. It involves recording the duties, responsibilities, skills,
work environment etc. of a given job.
In short, job analysis means gathering information and knowledge
about job and their requirement.
Process of Job Analysis (Steps)
1. Collection of actual information
The following type of information are generally collected for this
purpose.
 Job information – information relating to working condition
in respect of physical (temperature, noise, danger or
comfortable office facilities), Job’s social environment
(whether the work is performed in team, shifts or isolated
work), financial condition (wages paid, bonus, incentive
scheme, etc.)
 Quality of personnel
 Skill needed to perform the job
 Personality factors
 Experience
2. Preparation of job description
After collecting information, a statement showing details of the
activities of the job is prepared.
3. Preparation of the job specification

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It is a statement showing the minimum acceptable qualities

required for a person to be placed on a job.
4. Report preparation
The job analyst prepares a report and present the information
relates to the details of the job and qualities of persons before
supervisor for suggestions and comments. After obtaining
suggestions and comments, he prepares the original report.
5. Approval of the report
The original report is submitted to personnel managers for
approval. After getting approval from personnel manager it is
submitted to top executive. The final report should be approved by
the top executive.
Uses or Significance of Job Analysis
 It provides complete knowledge about the job
 It helps to know the personnel traits and characters requires for
performing a job.
 It gives a complete picture about the job
 Minimise risk
 Useful for job comparison
Methods used in Job Analysis
Job analysis is basically the process of collecting information about
jobs. Different methods are used to collect information.
1. Questionnaire
Job analyst prepares comprehensive questionnaire and it is
distributed among workers.
2. Checklist – a long list of task statements is supplied to workers.
they are required to check and mark the tasks they perform the
list.
3. Interview

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Job analyst asks questions regarding various jobs performed by

workers and supervisors.
4. Observation
The analyst can collect information from the workers at the site
itself.
5. Participation
The analyst himself participate in work. He gets firsthand
information about the qualities of the job.
6. Technical Conference
Under this method, information is collected from experts directly
about the traits of the job.
7. Diary
The employees are ad to record their daily activities in a diary.
Then the analyst can collect information about nature of the job
and time spent on various activities by the workers.
8. Records
The personal department maintain the job and job doers. The job
analyst collects information from these records.
JOB DESCRIPTION
The result of the job analysis is written in a statement known as job
description. This statement describes a job in terms of its title, location,
duties, responsibilities and relationship with other job.
Contents of Job Description
 Job location – the department in which the job is to be performed
 Name of the job
 Summary of job – description about the job
 Duties and responsibilities
 Degree of supervision
 Details of equipment, material and tools used
 Relation with other job

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 Safety and security of workers

 Physical conditions
 Special qualification of job, mental, physical experience
JOB SPECIFICATION
Job specification is a statement of the qualifications and capabilities
required for performing a job.
It specifies the type of persons required to perform the job in terms of
qualification, experience, aptitude, age etc.
A job specification is a statement of minimum acceptable human
qualities necessary to perform the job effectively.
Contents of job specification
 Physical characteristics. (height, weight, health etc.)
 Psychological features (Mental ability, decision-making ability etc.)
 Personal Characteristics (Behaviour, attitude, leadership quality
etc.)
 Responsibility (for equipment, office records etc.)
 Qualification (Educational qualification, experience, training etc.)
Difference between Job Description and Job Specification
Job Description Job Specification
It is the summary of duties, It is a statement of qualities
responsibilities, and other
possessed by a person who
characteristics of the job. perform the job
Preparation is not difficult It is difficult as compared with
job description
It helps the candidate to It helps the management in
understand the requirement of selecting right personnel
job
It mainly considers physical It considers physical and human
aspects of a job aspects of the job

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JOB DESIGN
Job design refers to arranging the duties and responsibilities relating to
a job.
Methods of Job Design
1. Job Rotation
2. Job Simplification
3. Job Enlargement
4. Job Enrichment
1. Job Rotation
It means the shifting of an employee from on job to another without
any change in the nature of the job.
It increases the knowledge and experience of employees.
2. Job Simplification
A given job is broken down in small sub-parts and each part is
assigned to each individual. It helps in standardisation of work and
specialisation of work.
3. Job Enlargement
 It means adding duties or task in a job.
 It does not require additional skill or training.
 It does not make any change in the nature of his work
 Increase efficiency
 Horizontal expansion of the contents of a job
 Increasing the scope of the job
Eg; A college lecturer who has teaching 14 hours a week may be
asked to teach two or more additional hours.
4. Jon Enrichment
 It provides the worker greater freedom for planning and
controlling his performance
 Vertical expansion of job

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 Adding duties and responsibilities that provide for skill, variety,

task significance etc.
 More challenging task
 Responsibility also increases
 Reduce absenteeism, labour turnover etc.
 It is the process of providing freedom to workers for performing
a job
JOB EVALUATION
It is the process of collecting information relating to a job for the purpose
of determining the value of the firm.
Edwin B Flippo Defines; “Job Evaluation is a systematic and orderly
process of measuring the worth of job in relation to other job.”
It is a technique for determining pay rates of a job.
Objectives of Job Evaluation
 To develop a consistent wage policy
 It helps in fixing wage rates
 To simplify the negotiation between labour union and management
concerned with wage structure
 To conduct wage surveys and compare wage structure with similar
firms
 To help the management for selecting candidates
 To establish rational basis for incentives and bonus schemes
 To fix same wage for same level of work in the organisation
Methods of Job Evaluation
Two types;
1. Qualitative Method
a) Ranking Method or Job Comparison method
b) Job Grading or Classification Method
2. Quantitative Method
a) Point system

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b) Factor comparison
1. Qualitative Method
a) Ranking Method
Under this method, all jobs in the concerns are arranged in the
order of importance. A committee is constituted to rank jobs.
Merits
 Simple an oldest method
 Economical
 Less time
 It involves less paper work
Demerit
 Suitable to small concerns
 To allot a rank for a new job is different task
b) Job Grading
Under this method, each job is allotted as grade.
Allot the grade by considering the factors like skill,
responsibilities, experience, type of work etc.
The job may be grades as skilled, unskilled, routine,
administrative etc.
Merits
 Highly suitable to govt. department
 Very simple to operate
 Less expense
 Less time
Demerits
 Not suitable for large concern
 The existing wage rate will affect the grading of job
2. Quantitative Method
a) Point Method

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Under this method, fair wages are determined after analyzing

jobs worth in detail.
Merits
 It ensures accuracy
 Suitable for large concern
 More effective
Demerits
 Expensive
 Time consuming
 Determination and selection of factors are difficult
b) Factor Comparison Method
This method is a combination of ranking and point method.
Under this method, few jobs are selected as key jobs and it is
evaluated. These key jobs are taken as standard against which
other jobs are compared.
Merits
 Gives reliable result
 More accurate job evaluation method
 Rating of a new job is not difficult one
Demerits
 Costly
 Difficult to understand and operate

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RECRUITMENT AND SELECTION

RECRUITMENT
Recruitment is the process of hiring the most suitable candidates for the
vacancies in an organisation.
According to [Link] “ Recruitment is the process of searching
for prospective employees and stimulating them to apply for jobs in an
organisation.
Factors affecting Recruitment
I. Internal Factors
1. Recruitment Policy
It may be related with internal and external source of
recruitment. Some organisation prefer internal sources, since
they are already employees of the firm.
2. Size of the organisation
The number of employees selected and employed is directly
related to the size of the organisation.
3. Cost of Recruitment
A lengthy process of recruitment involves more time and cost to
the organisation.
4. Growth and Expansion
If an enterprise has an expansion and growth plans, the
recruitment process is also planned to meet the future needs
arising due to expansion.
5. Human resource planning
The success of recruitment process depends upon the effectives
human resource planning.
II. External Factors
1. Labour market condition
General condition in the labour market like supply of labour,
demand of labour, wage rate etc. affect the recruitment process.

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2. Govt. policy on Reservation

The govt. insist that a certain percentage of jobs are reserved for
SC, ST, physically challenged people, OBC minorities etc. also
affect the recruitment and selection.
3. Unemployment problem
If unemployment rate is high in an area, the recruitment process
becomes an easy task.
4. Organisation image
If the company has a good image among public, the recruitment
becomes an easy task.
5. Demographic factors
Demographic factors are related to attributes of potential
employees such as their age, gender, income level, literacy,
education, standard of living etc.
6. Labour legislations
There are certain laws in our country which deal labour
recruitment and selection.
Eg;
Child Labour Act 1986
Employment Exchange Act 1959
7. Demand and supply of skilled labourers
Sometimes the demand for skilled labours are high compared
with their supply. In such situation, the recruitment becomes a
difficult task.

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SOURCES OF RECRUITMENT
Sources of Recruitment

Internal Sources External Sources

 Transfer  Notice at the factory gate
 Promotion  Unsolicited application
 Demotion  Casual callers
 Advertisement
 Employment Exchanges
 Educational Institutions
 Labour contractors
 Pvt. Agencies
 Trade Union
Internal Sources
1. Transfer
Transfer involves shifting of persons form one job to another or
from one place to another without any change in status, position,
emoluments, responsibility and authorities.
2. Promotions
Employees are promoted to higher positions with more
responsibilities and remuneration.
3. Demotion
Downgrading an employee by reducing his salary, decrease his
responsibility, authority and status.
External Sources
The organisation seeks suitable candidates outside the enterprise.
1. Notice at factory gate
The organisation put up a notice at the factory gate. The details
such as the number and the type of workers are required,
emoluments offered, qualification etc. are shown in the notice.

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2. Unsolicited Applications
Sometimes the job seekers will submit application to a company
on the expectation of getting a job in future. When vacancies arise,
suitable candidates are selected from these applications.
3. Casual Callers
Management appoint persons for short period
Eg: Persons appointed in a leave vacancy
4. Advertisement
Advertisements are given in newspaper or professional journals
5. Employment Exchanges
The job seekers register their names in employment exchange. The
employment exchange authorities send a list of suitable
candidates to the concerned employer. The employer select from
the list.
6. Campus Interview (Colleges, Institutions and Universities)
Leading companies approach colleges, technical institutions,
universities etc. directly for recruitment.
7. Labour Contractors
When workers are required, the personal manager contacts labour
contractors. They supply required labourers.
8. Recruitment Agencies
They help to recruit technical and professional personnel.
9. Trade Union
The job seekers are required to register their names with labour
unions. The labour unions supply names of persons for filling up
vacancies in the organisation.
10. Recommendations of the existing employees

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Modern techniques used for Recruitment (Modern trends

in Recruitment)
1. Knowledge based recruitment method
It is based on a mutual agreement between client and recruiting
firm to invest in a long-term strategic relationship.
In this method the client and the recruiting company together
define the anticipated skill set requirements over a period of time.
It is based on the concept of sharing information and updating
information on an ongoing basis, in order to continuously build a
pool of talented persons.
2. E- Recruitment/online Recruitment method
It is a recruitment method, involving sourcing candidates on the
internet
3. Outsourcing
The outsourcing firms help the organisation by the initial
screening of the candidates according to the needs of the
organisation and creating a suitable pool of talents for the final
selection by the organisation.
4. Poaching/Raiding
Poaching means employing a competent and experienced person
in an organisation by buying talent rather than developing.
A company can attract talent from another firm by offering
attractive pay packages and other terms and conditions, better
than the current employer of the candidate.

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Other Recruitment Methods

1. Campus recruitment
2. Waik in
3. Body Shopping
Professional organisations and hi-tech training institutes develop
the pool of human resource for the possible employment. The
prospective employers contact these organisations to recruit the
candidates.
These professional and training institutions are called body
shoppers and these activities are called body shopping.
4. Networking
Relevant and sustained relationship over a period of time can help
the HR professionals in networking with their colleagues.
5. Scouting
It means sending the representative of the organisation to various
sources of recruitment with a view to stimulating the candidates
to apply for jobs.
6. ESOPs (Employee Stock Ownerships)
Companies recently started stimulating the employees by offering
stock ownership to the employees through their employees Stock
Ownership.
7. Event recruiting
The company sponsors the events, where the candidates are likely
to attend the event.
8. Re-recruiting
When a most qualified or experienced staff leaves the company, let
them to welcome back.

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SELECTION
 Selection is the process of choosing the most suitable persons
from all applicants.
 It is the negative process
 (Recruitment is the process of inviting application, but selection
is the process of elimination)
Steps in selection Process
1. Receipt and scrutiny of application
2. Preliminary Interview
3. Blank Application form
4. Selection Tests
5. Employment Interviews
6. Checking References
7. Medical/Physical Examination
8. Final Selection
Step 1 – Receipt and Scrutiny of application
A number of applications may be received from candidates and
makes a detailed scrutiny of these applications.
Reject the applications of those applicants who do not possess the
required qualification.
Step 2 – Preliminary Interview
It is conducted to eliminate unsuitable candidates. They seek basic
information about candidates such as name, age, qualification,
interest etc.
Step 3 – Blank application form
It if filled by the job seeker. It contains personal history, educational
qualifications, work experience, reference etc.
Step 4 – Selection Test
The management can be understand the capabilities, knowledge,
interest, skill and aptitude of an individual by conducting the test. It
may be written test or practical test or psychological test.

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Types of Test
1. Intelligence Test
2. Aptitude Test
3. Interest Test
4. Personality Test
5. Trade Test
1. Intelligence Test
It uses to assess candidates mental power to understand, grasp
and appreciate, ability to judge and make decision.
Used to measure the candidate’s mental abilities.
2. Aptitude Test
It measures an applicant’s capacity and his potential for
development.
3. Interest Test
These tests are conducted to identify specific interest and based
on such interest jobs are assigned.
4. Personality Test
It applied to measure traits of candidates such as emotions,
maturity, reaction to situation etc.
5. Trade Test
These tests are conducted mainly to know the knowledge and skills
of the trade.
Step 5 – Employment Interview
Personal interview is an important stage in the selection process. It
is the face to face interaction between employer and employee.
Types of Interview
1. Formal Interview
 Held in a formal atmosphere
 Candidates are informed in advance
2. Informal Interview

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 Oral interview
 No formal place
 Not a planned interview
3. Patterned Interview/Standardised Interview
Various aspects of interview are decided in advance like the time
to be taken for each candidates, type of information collected to
from candidates etc.
4. Depth Interview
 The questions are selected by interview board in advance
 A series of questions are asked on the subject to measure
the candidate’s depth of knowledge in the subject or area
of interest.
5. Stress Interview
 This type of interview is conducted to know how a
candidate behaves in a particular situation.
 Here Interviewer deliberately create a situation that
motivates the candidates to react.
 It involves putting the candidates under relatively severe
emotional strain in order to test his response
6. Group Interview
 Candidate are divided into groups. Each group is given a
topic for discussion.
 The interviewer observes the leadership quality,
communication skills etc. for the requirement of the job
 The candidates are selected on the basis of performance
in the group discussion
7. Board Interview
 There is a panel of interviewers consists of experts in
different fields
 Each interviewers ask questions from different area

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8. Walk-in Interview
According to this method, vacancies are announced in
newspapers and prospective candidates are asked to appear for
walk-in interview at a place stated in the advertisement.
9. Campus Interview
Interview is conducted in college or other institutions
10. Exit Interview
 It is conducted at the time, when an employee is leaving
the organisation
 Its purpose is to know the feelings of the outgoing employee
regarding his job or institution
Demerits of Interview (Common errors in Interview)
 Personal Bias
The result of interview depends too much on the personal
judgment of the interviewer, which is not always correct.
 Hallo effect
When an interviewer judge all the traits of a candidate based on
the judgement of a single or few specific characteristics, which may
be positive or negative.
 Inability to judge
An interviewer sometimes, cannot judge the skill and ability of a
candidates for the job.
 Leniency
Certain interviewer has a tendency to give high scores and vice
versa
 Error in rating
After interviewing a brilliant candidate, there is a possibility of
underrating the next qualifies candidates by the interviewer.

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Step 6 – Checking References

The candidates are required to write the name of one or two important
respected and reputed persons in his locality. Therefore, the employer
can conduct enquires about candidates from those references such as
candidate background, skill, experience, character, ability and
suitability for the job etc.
Step 7 – Medical/Physical Examination
The qualified candidate is required to go for medical examination
Step 8 – Final Selection
After completing all the above formalities, the successful candidates are
given appointment order.
Difference between Recruitment and Selection
Recruitment Selection
Method of personal placement Procedure for personal placement
Process of inviting application from Process of elimination. Because-
probable candidates involves rejection of unsuitable
candidates
Process of searching for prospective Create a contractual relationship
employees and stimulating them to between employer employee
apply for jobs
Purpose is to create a large pool of Aims at elimination of unsuitable
applicants candidates
Process is simple. Candidates are not Process is complex.
required to cross several hurdles It consists of number of hurdles
created by management deliberately.

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