Systematic HRP forces top management of an organization to participate actively
in total HRM functions, an area that has been neglected by most of the companies until
recently.
HUMAN RESOURCE PLANNING PROCESS
This consists of series of activities as follows:
1. Forecasting
Forecasting of future manpower is an important step. It could be done in terms of
mathematical projection of trends in the economy and developments in the industry, or of
jundgement estimates based upon specific future plans of the company.
2. Inventory
Inventory of the present manpower resources and the degree to which these
resources are employed optimally should be assessed.
3. Anticipating problems
Anticipating manpower problems by projecting present resources into the future
and comparing them with the forecast of the requirements, adequacy both quantitatively
and qualitatively should be estimated.
4. Planning
Planning for recruitment, selection, training, deployment, utilization, transfer,
promotion, development, motivation and compensation to be undertaken for manpower
requirement.
Guiding Principles of effective HRP
The plan should be as detailed as expenditure constraints allow.
Should not extend too far into the future. Accurate prediction of the distant
future is simply impossible.
An alternative course of action should be considered.
Side effects and implications of the actions envisaged should be.
Instructed to individuals and departments must be incorporated into the
plan.
Plans should be concise and easy to understand.
HRP is not a static one-shot plan that will be useful over a period of time for the
organization; the data has to be continually updated and the various factors adjusted to
reflect the changes that constantly take place.
A Voluntary Retirement Scheme (VRS) is viewed as a universal cure for all organisational ailments. According to a survey by the Society of Human Resource Management, 50% of the organisations, which used this method, reported a decline in productivity or no change at all.
A right context has to be set for the programme first, especially for an organisation that is implementing it for the first time. Care should be taken not to project it as a downsizing exercise.
Guidelines
1. It cannot be implemented in isolation. VRS needs to be networked with the management's long-term objectives.
2. It is not a one-stroke exercise. VRS has to be implemented in a carefully planned time frame and phased manner to avoid complications.
3. It is applicable across all functions. During the first round, VRS should be applicable to all employees across the organisation. This is critical lest anybody should feel victimised. Subsequently, it could be targeted at specific groups within the company.
4. It is one of the many options. Managements need to explore a plethora of choices before zeroing in on VRS. A detailed examination of the existing systems and processes is essential.
Communication
The risks of VRS can be minimised through open communication and rewards for star performers. An effective communications strategy sends the right signals about the management's intentions in implementing VRS.
Open forum
The CEO addresses the forum every quarter on the company's prospects. Key questions as to the past, present and future direction of the company are addressed. This is followed by presentations by other executive committee members on costs, margins, profitability and competitiveness of the product.
Apex Forum
This forum is targeted at a smaller audience like union leaders and officers associations and at a greater frequency. Transparency is the key word in these meetings where various aspects of business needs are shared.
It is essential to convey the message that VRS is not a handout from the management. To this extent, suggestions from the rank and file need to be welcomed. Only then would VRS really be voluntary
Downsizing or Rightsizing
In today's competitive market, many companies found that staying in business requires downsizing. This is a decision that impacts the organisation’s performance tremendously and its impact is seen in ever sphere and felt by all employees. It is important to remember that this event affects not only the "downsized," but even those who remain.
Why Is this Important?
Downsizing has become a common occurrence in today's business world. Because of this, and many other factors, many employers and employees no longer believe in the concept of lifetime employment. As a result, employers often under estimate the need to provide support to employees, who are being released and also to the 'survivors.' Many employers feel that the only support they can provide is expensive outplacement services.
The decision to downsize is made for strategic and financial reasons. The expectation is that cost reduction will lead to a positive impact on the bottom line and will ultimately reflect in improved profitability and productivity. However, many organisations neglect the psychological impact of downsizing on those who remain. In fact, if downsizing is handled improperly, the problems it was designed to correct may intensify due to the impact on the loyalty and attitude of the survivors.
Effects on Work Effort
In an attempt to determine the impact of downsizing, the effects of job insecurity and economic need to work on the employee, Brockner and his colleagues examined employee attitudes. In this study, Brockner decided to use work effort as a measure for job attitudes. The study found that high job insecurity coupled with a higher need to work, resulted in increased work effort that usually followed a layoff. This indicates that when there are high levels of job insecurity, as would be expected during downsizing, employees with a greater need to work will increase their work effort, while the others will remain unchanged.
Brockner found that the remaining employees' perception of the fairness of the lay-off process and their attachment to the lay-off victims coloured their views about downsizing. This issue of fairness is related to a number of other work-related variables and has its roots in theories of organisational justice.
The Justice Theory
Layoff survivors are expected to exhibit the most negative reactions when they identify themselves with the layoff victims and feel that the victims have not been well compensated.
When survivors perceived that those laid off had been dismissed with little or no compensation, they reacted more negaitively, even to the extent that they felt some prior sense of psychological kinship with the laid-off parties".
Brockner's study would indicate that employees are not only affected by the layoff but also with the way they were managed. Brockner found that negative attitudinal changes were reflected in survivors' reduced work performance and lowered commitment to the organisation. Conversely, the study showed that employee commitment could actually increase during a layoff process when the company shows some commitment towards the displaced workers.
Brockner's study indicates that the organisations can proactively affect the surviving employees' attitudes during the downsizing.
Strategies for Maintaining Positive Employee Attitudes
According to the survey results of the study on employee loyalty conducted by Industry Week 2000, there were eight factors affecting employee loyalty in a downsizing situation. They are, in descending order: equity, security, good management, integrity, empowerment, good communication, benefits and personal support.
Communicate
During downsizing, the losses due to decreased employee loyalty, morale and productivity compound the complexity of the layoff process. For example, the rumour mill that develops, or intensifies, during the preliminary planning stages results in employees spending significant amounts of time gossiping and worrying about what might happen. Unfortunately, many managers in the position of being "in the know" are guided by a policy in which they should avoid talking about rumours with employees. While this policy may seem appropriate, the costs associated, in terms of lost productivity and employee loyalty may be significant. Communication helps curb worry and re-direct employee energies to the job at hand.
The most preferred method of communication is personal appearances from top management. However, any form of communication will be helpful.
Ensure that the communication covers the following topics:
- Talk about the fact that changes are going to take place.; This will increase the employee’s trust in you.
- Explain the purpose of the downsizing;
- Explain the need for growth and profitability
- If possible, explain future plans including detailed plans of restructuring, upgrading technology, or some processes to increase efficiency;
- Communicate, whenever possible, that though employee downsizing is necessary, each employee who is let go off will receive appropriate severance pay and job placement assistance;
- Emphasise that laid-off employees will be treated with respect and dignity; this is important for managing and maintaining the morale and commitment of the remaining employees.
Most importantly, listen carefully to employee concerns and address each concern adequately. This must be done with sincerity and no sense of condescension, such as "calming the mob."
In addition, justification of the layoffs is extremely important, especially if times are good and the downsizing is a part of strategic growth and profitability. Employees need to understand that you sincerely need to make these cuts and it is not a whim .
Make Valuable Employees a Part of the Progressive Organisation
To stay or not to, is the question asked by most remaining employees as an aftermath of their company's downsizing process--particularly those who have other employment opportunities outside the company. When these employees see some top managers leave voluntarily, they may question the long-term prospects of the company and will consider an immediate job change. This is something to watch out for, as people who leave under these circumstances are generally those with valuable skills and training.
Rebuild Loyalty
Long after downsizing, continue communicating with employees to re-build security and trust. Do not allow management to assume remaining employees are merely grateful to still have their jobs. Employees need to feel they are valued, that they have a place in the company, and that the management believes that they are an important part of the success of the organisation. To emphasise this point, talk about where the company is headed, and describe any plans for growth and prosperity.
A Valuable Tool: an Employee Satisfaction Survey
An employee survey can help an organisation gauge employee satisfaction. As redevelopment programs are implemented, the initial survey will provide a benchmark for comparative measures. Such a survey also conveys to employees that the company is concerned about their satisfaction and the need to build a stable work environment.
Companies striving to be leaner and more profitable must consider the cost of employee discontent and must strive to manage any downsizing practices to keep up the goodwill of remaining employees.
