Chapter 4 – Human Resource Planning, Recruitment, and Selection
Strategic plans are broader, longer in time frames (2-3 yrs), provide overall direction, and
apply to the entire organization.
Human resource planning: Process that the people required to run the company are
being used as effectively as possible, where and when they are needed, in order to
accomplish the organization’s goals. (a.k.a. manpower or employment planning)
In essence, right people in right jobs at right time.
HR planning is aligned to ensure the objectives are met because strategic planning
involves the allocation of resources (incl. human capital).
HR planning has 4 steps:
1. Forecast demand for labour in the organization.
2. Determine the supply of labour – both external and internal to the organization.
3. Identify the gap between demand and supply.
4. Develop action plans to close or eliminate the gap.
The line manager needs to make plans for business objectives and necessary staff.
Succession planning involves businesses focusing on training and development programs
so that they can develop leaders for the future.
Importance of Planning for Staffing Needs
Shifts in composition of labour force require that managers become more involved in
planning their staffing needs. This is because the changes affect employee recruitment,
methods of employee selection, training, compensation, and motivation.
Inadequate planning can cause vacancies to remain unfilled. The resulting loss in
efficiency can be costly.
Planning is systematic in medium to large organizations, while small companies approach
HR staffing needs on a short-term basis.
HR Planning Approaches
Trend analysis: Quantitative approach to forecasting labour demand on an
Management forecasts: Opinions and judgements of supervisors or managers and others
that are knowledgeable about the organization’s future employment needs.
Staffing table: Graphic representations of organizational jobs along with the numbers of
employees currently occupying those jobs and future employment needs.
Markov analysis: Method for tracking the pattern of employee movements through
Page 1 of 4 Skills inventory: Information about the education, experiences, skills, etc. of staff.
Results of HR Planning
Result of HR planning is to achieve a useable balance between supply and demand for
Employee turnover costs as much as 2x annual compensation, so it’s crucial to retain key
Ways to deal with an oversupply of labour:
a) Attrition: Natural departure of employees. (e.g. quitting, retiring, dying)
b) Leave of absence without pay
c) Job sharing Solving short-term oversupply.
d) Reduced hours
Ways to deal with shortages of labour:
a) Hire full time/part time
b) Lease employees
c) Use overtime
d) Retention strategies
Recruitment: The process of finding and encouraging potential applicants to apply.
5 steps of recruitment process:
a) Planning for staffing needs
b) Identification of current or future job openings
c) Getting individual job information (job description and job specifications)
d) Determining recruitment method (internal or external)
e) Creating pool of potential qualified applicants
Challenge: continue recruitment process during difficult economic times.
Important to focus on employee retention and accessing new talent due to shortage of
people with certain skill sets. (e.g. building a better workplace)
By branding employment, organizations create an opportunity to retain their key talent.
By recruiting from within, an organization can capitalize on previous investments made
in recruiting, selecting, training, and developing its current employees.
Internal promotions can reward employees for past performance and send a signal to
other employees that their future efforts will pay off.
Integrated promotion policies as a part of employment equity programs.
Transfers protect employees from layoff or broaden job experiences. They also
eliminate orientation and training costs. It is also easier to predict success from
past performance than data from outside applicants.
Page 2 of 4 Methods of locating qualified internal job candidates:
a) HRIS creates databases that contain complete records and qualifications of every
employee in the organization.
b) Succession planning is identifying, developing, and tracking key employees for future
c) Internal job posting: Method of communicating information about job openings.
(e.g. vacancy notices, company newsletters, computerized job posting systems