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

HR imbalance – quantitative/qualitative Analysis and investigation External labour market Internal labour market Organisational assessment Corporate strategy Forecasting 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. Planning and resourcing Using HR techniques Developing policies and reviewing practice Utilising technology Implementation and control 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 workforce Source: 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 Analysis Leavers in year x 100 Average number of staff in post Stability Index/Analysis Number of staff with 1 year’s service Number of staff employed exactly one year before

Statistical Analysis Cohort Analysis Retention Profile E.g. graduate trainees Survival rate Retention Profile Replacement and Succession Planning/Internal Promotion Analysis

Numbers surviving to end of year after engagement 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 23 38 27 2007 42 36 21 Total 200 167 142 125 110 100 Average Survival Rate 100% 84% 71% 63% 55% 50%

Regional Sales Manager (North) (Scotland and Northern Ireland) Sales Director Regional Sales Manager (North) (Scotland and Northern Ireland) Sales Manager 3 Salespersons (North and Wales) 6 Salespersons Regional Sales Manager (South) Sales Manager (Midlands) 12 Salespersons Sales Manager (South ) 15 Salespersons

Regional Sales Manager North G. Roberts M. Smith S. Johnson Post Current Postholder Ready now Ready Soon Ready Future Sales Director D. Coutts F. Enfield J. Wilson Regional Sales Manager North G. Roberts M. Smith S. Johnson Regional Sales Manager South Sales Manager (Scotland & NI) H. Sim G. Neish M. Knowles Sales Manager (North & Wales) P. Adam C. Fisher Sales Manager (Midlands) S. Thompson G. Dunn N. Hughes Sales Manager (South) M. Aitken C. Cameron W. Davidson M. Green S. 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 policies Source: Williams in Leopold, J. (2002) Human Resources in Organisations, Harlow, Pearson Education Ltd, pp. 36.

Forecasting Supply and Demand 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 objectives Cons 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