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Lecture

MHR 523 Lecture Notes - Canadian Human Rights Act, Nominal Group Technique, Markov Chain


Department
Human Resources
Course Code
MHR 523
Professor
Al- Karim Samnani

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MHR Chapter 3: Human Resource Planning (pg 91-123)
Planning allows HR departments to be proactive which in turn improve the department’s contributions to the
organization’s objectives.
RELATIONSHIP OF HR PLANNING TO STRATEGIC PLANNING
Proper Staffing is Critical for Strategic Success
If an organization is not properly staffed with the right number and types of people, strategic success is
endangered.
Different Strategies Require Varying HR Plans
Aggressive hiring, training and/or promotions vs. cost reduction strategy often necessitate layoff and early
retirement of surplus employees. A shift from cost leadership to focus/differentiation strategy requires changes in
the number and skill levels of employees.
HR Planning Facilitates Proactive Responses
HR planning or employment planning by facilitating better recruitment, selection and training strategies not only
helps companies meet their legal obligation but also allows them to face challenges proactively.
Successful Tactical Plans Require Appropriate HR Plans
The overall organizational strategy defines the HR objectives that are accomplished through the
implementation of appropriate HR plans. Successful organizations recognize the importance of
“intellectual” or “human” capital. An effective HR plan is a critical tool to take advantage of this valuable
asset.
HR planning is more than head counting and matching supply w/demand it involves the creation of an
HR vision for the future, including answering questions such as, what should our employees look like,
what competencies should they possess, how should we groom our employees for emerging challenges
and opportunities.
Through planning w/short term and long term goals, organizations are better able to develop their
corporate and functional plans and integrate these with their HR plans as well. Ensures better fit between
short and long term goals plans in organization
Employment planning is more common in large organizations because it allows them to:
o Improve the utilization of HR
o Match HR related activities and future organization objectives efficiently
o Achieve economies in hiring new workers
o Expand the HR management information base to assist other HR activities and other
organizational units
o Make major demands on local labour markets successfully
o Coordinate different HR management programs such as employment equity plans and hiring
needs
THE DEMAND FOR HUMAN RESOURCES
Causes of Demand
External Challenges
Economic Developments: difficult for HR specialists to predict in short run and sometimes impossible to
estimate in long run
Social-Political-Legal Changes: easier to predict but implications are seldom clear (ex. as demographics
change, so do employee attitudes toward work and their employers; impact on HR planning of the
Canadian Human Rights Act, passed more than 20 yrs ago, is still somewhat unclear)
Technological Changes: difficult to predict can affect both demand and supply of human resources; very
often, technological changes tend to reduce employment in one department while increasing it in another
Competitors: affect organizations demand for HR but not in any uniform manner (ex. traditional sectors
barely any growth because of foreign competition and a push for productivity improvement but in
electronic industries, competition causes lower prices)

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MHR Chapter 3: Human Resource Planning (pg 91-123)
Organizational Decisions
Strategic Plan: involves identification of a firm’s mission and objectives and plan for achieving those
objectives. Commits the firm to long range objectives which determine the numbers and types of
employees needed in the future. Has decisive influence on HR plans and the competitive strategies used
(focus, cost leadership, differentiation)
Budgets: increases or cuts are most significant short run influence on HR needs
Sales and Production Forecasts: less exact than budgets by may provide even quicker notice of short run
changes in HR demand
New Ventures: mean new HR demands; by acquisitions and mergers cause an immediate revision of HR
demands; positions may have to be eliminated to avoid duplication while new integrated ones may have
to be created for smooth operating of merged units :
Organizational and Job Design: changes in structure have major implications for HR needs; automation,
computerization and job redesign also necessitate major revisions in HR need estimates
Workforce Factors: demand is modified by employee actions such as retirement, resignations, terminations,
deaths and leaves of absence. When large numbers of employees are involved, past experience usually serves as a
reasonably accurate guide. However, reliance on past experience means that HR specialists must be sensitive to
changes elsewhere
Forecasting Human Resource Needs
Forecasts: estimates of future resource needs and changes; best viewed as approximations.
Expert Forecasts: rely on those who are knowledgeable to estimate future HR needs
Nominal Group Technique: focused, group discussion where member write down their ideas and share
them. All new thoughts on top are recorded and ranked for importance
Delphi Technique: soliciting of predictions about specified future event from a panel of experts, using
repeated surveys until convergence in opinions occurs
Trend Projection Forecasts: crude, short run approximations because they assume that the causes of demand
remain constant, which is seldom the case; very inaccurate for long range HR projections
Extrapolation: extending past rates of change into the future
Indexation: a method of estimating future employment needs by matching employment growth with a
selected index, such as the ratio of production employees to sales
Other Forecasting Methods:
Budget and Planning Analysis: detailed budgets and long range plans
New-Venture Analysis: requires planners to estimate HR needs by comparison with firms that already
perform similar operations
Computer-Based Simulation Models: most sophisticated; computer models are a series of mathematical
formulas that use extrapolation, indexation, survey results, and estimates of workforce changes to
compute future HR needs. They simulate and forecast changes in demand for HR caused by various
internal and external factors
Listing Human Resource Requirements
Long range plans are of necessity, general statements of probable needs; specific numbers are either omitted or
estimated.
Staffing Table/Manning Table: used to report short term plans as they are more specific
List of anticipated employment openings for each type of job; may be specific number or approximate
range of needs
Neither complete nor wholly accurate; only approximations but they allow HR specialists to match short
run demand and supply
THE SUPPLY OF HUMAN RESOURCES
Internal Supply Estimates
Markov analysis: forecast of a firm’s future HR supplies, using transitional probability matrices reflecting
historical/expected movements of employees across jobs
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