Manpower planning is basically deals with coordinating, motivating and controlling of the various activities within the organisation.
It is no doubt, planning is the most essential factors for each and every organisations. Without planning, no organisation can fulfil its goals. Generally, Human Resource planning is also called manpower planning.
Manpower Planning is the development of strategies to match the supply of manpower to the availability of jobs at organizational, regional or national level.
Manpower planning involves reviewing current manpower resources, forecasting future requirements and availability, and taking steps to ensure that the supply of people and skills meets demand.
In the words of Stainer, “manpower planning is the strategy for the acquisition, utilisation, improvement and preservation of organisation^ human resources. It is aimed at coordinating the requirements for and the availability of different types of employees.”
1. Introduction of Manpower Planning 2. Definitions of Manpower Planning 3. Objectives 4. Need 5. Importance 6. Bases
7. Factors 8. Process 9. Types 10. Elements 11. Advantages 12. Problems.
What is Manpower Planning? – Introduction, Objectives, Need, Importance, Factors and Process
- Introduction of Manpower Planning
- Definitions of Manpower Planning
- Objectives of Manpower Planning
- Need of Manpower Planning
- Importance of Manpower Planning
- Bases of Manpower Planning
- Factors to be Considered for Manpower Planning
- Process of Manpower Planning
- Types of Manpower Planning
- Elements of Manpower Planning
- Advantages of Manpower Planning
- Problems of Manpower Planning
What is Manpower Planning – Introduction
Though the organisation of men for managing a purpose is an age-old thing, the science of management is still in nascent stages.
Manpower is a primary resource without which other resources like money, material etc. cannot be put to use. Even a fully automatic unit such as an unmanned satellite requires manpower to execute it and plan further improvements/activities. That is why man learned the use of manpower much before he learned to use other resources.
In order to achieve a goal, manpower requirement needs to be assessed, located and harnessed. Manpower planning requires not only a simple assessment of the number of men required but also their categories and skills as well as their balanced allocation. Improper planning may lead to either over-staffing or under-staffing, both of which should be avoided. Over-staffing not only increases direct cost (salary) but adversely affects the cost of training, housing amenities etc., besides production cost. Under-staffing also affects production morale and, therefore, industrial relations.
Optimum manpower planning therefore assumes importance.
It should aim at:
1. Avoiding imbalances in distribution or allocation of manpower
2. Controlling the cost aspect of human resources
3. Formulating transfer and succession policy
Manpower planning is needed wherever production of goods and services is involved. It is an important factor of labour productivity and profitability of the enterprise. In an industrial undertaking this is done very carefully by-
External agencies such as professional consultants and suppliers of plant and machinery for they have the knowledge of working of similar units. It is generally done in the initial stages or when internal agencies do not have the required expertise for manpower planning.
Internal agencies such as the personnel department, industrial engineering, plant manager and finance department as all these agencies are interested in production, productivity, industrial relations and other aspects of manpower planning.
What is Manpower Planning – Definitions
Manpower Planning is the development of strategies to match the supply of manpower to the availability of jobs at organizational, regional or national level. Manpower planning involves reviewing current manpower resources, forecasting future requirements and availability, and taking steps to ensure that the supply of people and skills meets demand.
Manpower Planning is estimating or projecting the number of personnel with different skills required over time or for a project, and detailing how and when they will be acquired.
Manpower planning in terms of human resource development is the skills, knowledge and capacities of all human beings actually or potentially available for economic and social development in the country.
Manpower planning refers to optimal use of human resources. It is a procedure used in organizations to balance future requirements for all levels of employee with the availability of such employees.
Manpower planning is the rightsizing and achieving the balance of demand and supply of workforce. The penalties for not being correctly staffed are costly.
i. Understaffing loses the business economies of scale and specialization, orders, customers and profits.
ii. Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminate because of modern legislation in respect of redundancy payments, consultation, minimum periods of notice, etc. Very importantly, overstaffing reduces the competitive efficiency of the business.
Manpower Planning is the process of systematically forecasting the future demand and supply for employees and the deployment of their skills within the strategic objectives of the organization. It is the process by which Management determines how the management should move from its current manpower to its desired manpower utilization.
Robert William Pollock, CEO, Drake International observed, “From this angle (critical path) comes the proposition that, to be effective, manpower planning most irrevocably is tied to corporate strategy, and the reasons for this are laid out and analyzed. There is also a hard-hitting assessment of management priorities, which might sound like heresy to some personnel managers. As we know deployment of capital is a critical, CEO’s decision is equally critical, if not more so, is the procurement and deployment of people resources.”
Human Resource or Personnel Management is the productive exploitation of manpower resources. This is also termed as ‘Manpower Management’. Manpower Management is choosing the proper type of people as and when required. It also takes into account the upgrading of existing people. Manpower Management starts with manpower planning.
What is Manpower Planning – 13 Main Objectives
1. Demonstrate understanding of competency based approach in human resource.
2. Utilise tools in identifying current staff competencies and gaps, vis-a-vis, the organization’s goal and targets.
3. Demonstrate skills in conducting training needs analysis.
4. Formulate strategies for addressing identified training needs, prepare and design training modules and develop curriculum for training course and cost estimates.
5. Demonstrate the abilities to have the human resources development plan approved by the appropriate decision making body.
6. Design different training programmes to meet specific needs of particular group.
7. Formulate detailed implementation schedule.
8. Design evaluation tool.
9. Implement training and development activities, programmes and plans.
10. Write a professional report.
11. Demonstrate knowledge on using relevant analytical tools for planning.
12. Explain the relationship between the organization strategic plan and the strategic human resources development planning process.
13. Conduct a comparative study on the current human resources development planning process.
What is Manpower Planning – Need: Updating the Knowledge, Improving Performance, Developing Human Skills and a Few Others
The need for manpower training in an organization may be categorized in the following ways:
i. Updating the knowledge – The first and foremost need for manpower training is to renew and update knowledge and skills of employees to sustain their effective performance and so also to develop them for future managerial positions.
ii. Improving performance – Continuous training is required to renew and update the knowledge of the employees which makes them functionally more useful. The performance of the employees is depends on the type of training given to them. One way training the employee’s skills is directly proportional to the performance of those employees.
iii. Developing human skills – Apart from emphasizing on technical and conceptual skills, new training programs also put emphasis on developing human skills of employees. Such human skills are necessary for effective interpersonal relations and sustaining healthy work environment.
iv. Imparting trade specific skills – In industrial employment, the convention is to recruit workers and employees through compulsory apprenticeship training. Such apprenticeship training enables an organization to impart industry and trade specific skills to workers.
v. Stabilizing the workforce – Throughout the world, the importance of training is now increasingly felt for stabilizing the workforce to withstand the technological change and making the organization dynamic in this changing process.
What is Manpower Planning – Importance: Key to Managerial Functions, Efficient Utilization, Motivation, Better Human Relations and Higher Productivity
Importance # 1. Key to Managerial Functions:
The four managerial functions, i.e., planning, organising, directing and controlling are based upon the manpower. Human resources help in the implementation of all these managerial activities. Therefore, staffing becomes a key to all managerial functions.
Importance # 2. Efficient Utilization:
Efficient management of personnels becomes an important function in the industrialization world of today. Setting of large-scale enterprises require management of large-scale manpower. It can be effectively done through staffing function.
Importance # 3. Motivation:
Staffing function not only includes putting right men on right job, but it also comprises of motivational programmes, i.e., incentive plans to be framed for further participation and employment of employees in a concern. Therefore, all types of incentive plans becomes an integral part of staffing function.
Importance # 4. Better Human Relations:
A concern can stabilize itself if human relations develop and are strong. Human relations become strong trough effective control, clear communication, effective supervision and leadership in a concern. Staffing function also looks after training and development of the work force which leads to co-operation and better human relations.
Importance # 5. Higher Productivity:
Productivity level increases when resources are utilized in best possible manner, higher productivity is a result of minimum wastage of time, money, efforts and energies. This is possible through staffing and its related activities (Performance appraisal, training and development, remuneration).
What is Manpower Planning – Bases
Manpower planning is done on the basis of:
1. Growth plans which provide information about expansion, modernisation, diversification of business and new projects to be commissioned with likely commissioning dates and details about manpower requirements.
2. Separation data available from company records. Separation due to superannuation may be known easily, but those due to future resignations, transfers, terminations and voluntary retirements may be projected based upon past experience and the company policy in this regard.
3. Manpower used, various grades offered, etc., in similar plants outside. These may give broad guidelines of the requirements. However, the guidelines may be modified to suit the process, layout, local conditions and other associated factors like the extent of mechanisation, climatic conditions, statutory requirements, social systems, etc.
4. The experience of the manager based on direct and intimate knowledge of the working of similar shops. This can act as a guide to determine manpower requirement. However, ad hoc manpower decided on this basis should be subjected to ‘work study’ and ‘activity sampling’ techniques for containment, rectification of imbalances and manpower requirement.
5. Job analysis and knowledge of work and historical records (if available) to determine manpower requirements, skills, responsibilities required of the job holder, type of position to be manned, etc.
Time studies are used for setting up standard times which help to work out norms of manpower requirements.
What is Manpower Planning – Factors to be Considered for Working Out the Manpower Planning
Every organisation requires coordinated effort, management has to create an environment in which people can decide and act jointly and share the responsibilities and rewards as a team. An organisation is well-managed if its people strive willingly to achieve its goals and the management looks after their welfare, without being asked to do so.
An employee, whether he is working at the lowest ladder or directing from the highest seat, is a human being first and anything else later. As an individual, he is a separate entity. In the words of Swami Vivekanand, “Individuals have each their own peculiarities and each man has his own method of growth, his own life marked out for him by the infinite past life…
Everyone born into this world has a bent, a direction towards which he must go, through which he must live…” Man has his own needs, aspirations, affiliations and egos and his own way of looking and judging events and people around him. He wants to do something and be something in an environment which is only partly in his control. He brings with him certain traits and characteristics and vast potentialities.
Family, neighbourhood, society, culture and religion influence his life pattern and way of thinking. The economy of the country, the cost of living, income level, availability of goods and services, geographical factors and climate, the form of government, political and legal systems, and overall work culture constitute his environment. Man is not a passive observer of his environment. When he joins an organisation, he is not a raw material like cotton or iron ore, but a living human being.
His reaction to management’s policies and programmes, work environment and people around is influenced by multiple factors related to his own self, society, organisation and environment. His behaviour is not easily predictable. Managing man, therefore, requires knowing why and how he behaves in different situations the way he does, and what will or what will not motivate him at the job.
Factors to be considered for working out the manpower planning:
It is the responsibility of personnel department to prepare a scientific manpower planning for the firm.
The following factors are to be considered for working out the manpower planning:
(1) A decision regarding the fields in which the organisation will concentrate its main effort.
(2) A view should be taken on all share which an organisations can hope to achieve in the overall market assessed for the line or products or service supplied by the organisation.
(3) The estimate will have to make of the resources and the production / sales capacity which would be needed by the firm to take full advantage of the market potential.
(4) General production and marketing plans and targets should be prepared for the period for which planning is proposed to be undertaken.
(5) The area of activity of the firm is one of the potential factor affecting the manpower planning.
(6) A detailed assessment of the stage of socio-economic development is another important factor affecting the manpower planning.
(7) A complete survey of Government Policy pertaining to the area of production should be undertaken which would determine the prospective plans of Manpower.
What is Manpower Planning – 9 Important Processes: Manpower Plan and Objectives of the Organisation, Assessment of the Manpower Situation and a Few Others
Process # 1. Manpower Plan and Objectives of the Organisation:
In the organisation, Human Resource Planning plays a significant role. The objectives of the organisation have to be started with personnel requirements and efficiency should be measured by specific norms. Within the broad parameter of objectives, priorities have to be ordered and performance indicators specified in quantifiable or measurable terms.
Process # 2. Assessment of the Manpower Situation:
Human Resource Planning deals with collecting all possible information which is basically regarding educational qualifications, experience, abilities, aptitudes performance, date of joining, date of birth and date of retirement etc. of individual employees. It mainly based on skills of employees and also the resource base of the organization.
Organisational effectiveness over a period of time can be assessed by statistics prepared. It also help for the future in terms of how efficiency levels can be enhanced, what qualifications need to be prescribed at what level, what training to institute, etc. in order to raise efficiency to desired.
Process # 3. Projection of Manpower Requirements:
A manpower plan has two components:
(1) Manpower Demand Plan, and
(2) Manpower Supply Plan.
The supply plan deals with the source of proposed manpower. A manpower plan should spell out the manpower requirements of an organisation in totality. The process of manpower planning involves use of techniques such as quantitative analysis, multi-variate skills analysis, operations research, PERT and CMP, orthogonal polynomials, etc.
Process # 4. Classification and Interpretation of Information:
Information collected must be classified to facilitate analysis. Data have to be ready properly and inferences drawn accurately to derive correct conclusion and formulate objective policy based up such conclusions. Therefore, the information collected a data, which is essential for the organisation to be classified and interpreted.
Process # 5. Developing Work Standards and Performance Norms:
Human Resource Planning deals with a lot of developing work standard and also performance the norms of the organisation. For the improvement, work norms need to be developed and should be framed realistically in that the limitations or constraints of ‘bounded rationality’ should be provided for. Standards must be developed in the light of all available information at specific levels.
Objectives should be laid down clearly in that they should be intelligible to the ordinary worker and should not in any way result in ambiguity or lack of role specify. Therefore, standard should be (1) realistic, (2) provisional, (3) appropriate, (4) flexible and (5) clearly defined.
Hence, the Human Resource (manpower) planning is to set up hierarchy of objectives, stipulate qualifications for each level, set up a manpower plan, assign weights to performance indicators, work-out plan, judge efficiency by performance indicators, review plan, etc.
Process # 6. Anticipating Manpower Problems:
There is a gap between the qualitative and quantitative in the performance of personnel manpower needs. All types of information is useful in writing job descriptions and specifications and also plugging “gaps” to reduce the efficiency ‘lag’ by discovering requirements at different levels and making provision for the same.
Process # 7. Costing Inventory:
For the Human Resource Planning, information is also needed regarding:
(a) Materials available in the organisation
(b) Building in use
(c) Availability of computers.
Process # 8. Supply of Personnel:
Policy planners need to work in close co-operation with educational and training institutes to ensure adequate supply of personnel. Policy should be sustainable in that organisation must have sufficient funds to pay for new and added services. One way could be to avoid employing highly trained personnel for tasks that can be accomplished by less qualified staff.
The ministry of public health, for example, employed trained midwives in family planning programmes to reduce costs and free doctors who were in short supply for more skilled tasks. The measure reduced costs and pilot studies revealed that performance of nurse, midwives was a good as qualified doctors.
Process # 9. Research Studies:
Basically, Research Studies is based on the evaluation of manpower planning in the organisation. It also deals with the empirical studies, which advised for future changes. Policy has to be fact based and as objective as possible to maximise rationality and avoid satisfying solutions or a priori judgement in decision-making. It mainly focus on the economic dimension on policy-making and implementation.
So, research is effectiveness of training programmes by application of tools like post training surveys. Sophisticated analysis is needed to examine discrimination claims and complaints.
What is Manpower Planning – 2 Major Classification: On the Basis of the Level at which it is Done and On the Basis of the Period for which it is Done
Types of manpower planning can be distinguished by two criteria:
(1) On the basis of the level at which it is done, and
(2) On the basis of the period for which it is done.
(1) On the Basis of the Level at which it is Done:
Manpower planning is done on the national level as a part of the planning for overall economic development. The objective behind this is to provide more and more opportunities of employment, while utilizing the human resources of the nation most efficiently.
It goes without saying that proper manpower planning is a high necessity in a developing country like India. In Britain, manpower research section of ‘Employment and Productivity’ department undertakes necessary steps for manpower planning. In India, manpower planning is a port of overall planning and so its responsibilities lie with the Planning Commission.
Manpower planning by the Planning Commission covers:
(a) Population projections,
(b) Programme of economic development,
(c) Education facilities,
(d) Occupational distribution and growth, and
(e) Industrial and geographical mobility of personnel.
As manpower planning is important at national level for the maximum use of its manpower resources. It is also necessary at the level of a business unit. Manpower planning is important because it decides the various measures to be taken such as recruitment, selection, promotion, transfer, expansion, etc., by a business unit.
In order to fulfil future manpower demands, this manpower planning is possible at three levels in a unit:
(i) At the departmental level,
(ii) If there are a number of factories of company the planning can be done at the level of each individual factory taken apart; and
(iii) At the top level, i.e., by the board of directors in a company.
If the manpower planning is done at departmental level, two advantages can be derived. Firstly, the advantage of the knowledge of those who are in direct contact with the workers can be taken; and secondly, if the people who are going to execute the plans take part in the planning process, the probabilities for success of the plans would be surely higher.
A committee is formed at this level. The committee would make inspection of the manpower estimates put for the previous year and the actual manpower position of the previous year. The two records would be compared. Then, on the basis of this comparison, estimates for the next year’s manpower requirements and the sources available to fulfil these requirements would be made known.
Then, keeping in view the expected changes within next 3 to 5 years, the committee would sit with manpower planning experts and prepare a format for future manpower planning. This format would be presented before the top level and the final draft would be prepared on its approval.
At the two level, such formats as sent by different departments are considered by an administration committee. A grand plan is prepared by coordinating manpower plans of different departments. This grand plan is then coordinated with the overall planning of the business.
(2) On the Basis of the Period for which it is Done:
Three such divisions can be made, which are discussed in the following paragraphs:
(i) Short-Term Manpower Planning:
Short-term planning is that which is done for the period of one year. Annual plans are made as a part of Five-Year Plans at national level. These one year plans are short-term plans. Short-term plans are very useful at company level. For better results, short-term plans should be integrated with each other and should be considered as ingredients of a medium-term plan.
(ii) Medium-Term Manpower Planning:
Generally, any plan of period from 2 to 5 years is considered to be a medium-term plan. At national level, medium-term plans are essentially prepared as a part of financial planning, medium-term plans, at national level, for manpower planning give special attention towards employment opportunities.
Such plans at micro-level think much of training and development of employees. Thus, it is possible to visualise the requirements of personnel possessing right type of skills for coming five years.
(iii) Long-Term Manpower Planning:
The planning for a longer period such as 10 to 15 years is known as long-term planning. This type of long-term planning is generally done at national level. This is important to estimate manpower needs of a nation and accordingly to raise educational and training facilities, keeping in view long-term interests of the nation.
Such long-term planning is not necessary at micro-level except a long-term development scheme has been visualised by the management of a firm. But, in normal practice, such long-term planning is not found at company level.
What is Manpower Planning – 3 Basic Elements: Forecasting Demand, Analyzing Human Resources Supply and Matching Human Resource Requirements with Availability
The process of manpower planning consists of three elements:
Element # 1. Forecasting Demand:
Estimating the demand for manpower is the starting point of a fairly elaborate methodology associated with human resource planning. The demand for manpower in technology, changes in the organization, change in the existing product mix, personnel policy, etc., are considered under this.
Element # 2. Analyzing Human Resources Supply:
The human resources demand of an organization can be drawn from existing human resources in the organization and the external market. It is a general practice that the search for human resources starts from within the organization.
After assuring the available resources in the organization, one has to look for assessing the external market.
Element # 3. Matching Human Resource Requirements with Availability:
Requirement and availability of human resources is based on continuous checking (human resource audit) of the utilization of the existing resources, manpower wastage (potential losses), and how an organization collects, maintains, analyzes, and reports information on people and jobs (human resource information system).
What is Manpower Planning – 7 Advantages
The importance of manpower planning has been recognised by the Western countries. In India, much attention is not being given towards this section of planning.
If manpower planning is practised in its true perspective, following gains can be achieved:
1. Arrangements for recruiting new employees or training current employees can be made, keeping future manpower needs in mind. As a result, the company’s production, or any work for that matter, does not stop for lack of employees.
2. When present employees are trained for some higher positions, their spirits soar higher. Such psychological effects are much desired in a firm to keep up the worker’s morale.
3. While carrying on the process of manpower planning deficiencies of the personnel of the organisation can be noticed. Training programmes can be undertaken to cover up these deficiencies. In this way, present manpower’ can be made more efficient.
4. Though the unemployment problem is a burning problem of India, scarcity of skilled and efficient persons to occupy top management positions is always felt. In such a situation manpower needs (as for top management positions) can be fulfilled by training intelligent and efficient people in the organisation.
5. In some manufacturing concerns, labour charges constitute 25 to 40 per cent of total cost of production. In certain units engaged in providing services, salaries from 50 to 60 per cent of the total expenditure. To control these costs effectively, manpower planning is a must.
6. Manpower planning can guarantee the availability of persons with required skills for long-term plans. As a result the company can proceed confidently with its long-term plans.
7. Manpower planning tries to see that there is no excess or lack of manpower in future.
If there is excess manpower, it would mean additional costs for the company. Also, the company may not be in a position to retrench workers because of powerful trade unions.
On the other hand, lack of manpower would mean a fall in output and consequently fall in profitability of the firm.
What is Manpower Planning – 10 Problems: Accuracy of Forecasts, Identity Crisis, Support of Top Management and a Few Others
Problem # 1. Accuracy of Forecasts:
Manpower planning includes forecasting the demand and supply of human resources. In this way the effectiveness of planning is conditional as it depends upon the accuracy of forecasts. In case the forecasts are not cent per accurate, as may often happen planning will not be hundred per cent accurate.
Problem # 2. Identity Crisis:
It is found that a great number of human resource specialists and the managers are unable to understand the whole manpower planning process. Because of this, there is generally an identity crisis. Till the specialists develop a strong sense of purpose, planning cannot be effective.
Problem # 3. Support of Top Management:
Manpower planning needs full and whole hearted support from the top management. Without of this support and commitment, it would not be possible, to ensure the necessary resources, cooperation and support for the success of the manpower planning.
Problem # 4. Expensive and Time Consuming:
Manpower planning is a many consuming as well as time consuming process. Employers may resist manpower planning, feeling, as it tends to it increase the cost of manpower.
Problem # 5. Insufficient Initial Efforts:
Successful human resource planning flourishes slowly and gradually and is time consuming. Sometimes sophisticated technologies are forcefully introduced, only due to the fact that competitors have adopted them. These may not be successful unless matched with the needs and environment of the particular enterprise.
Problem # 6. Resistance from Employees:
A common observation is that employees and trade unions resist manpower planning. They fear that this planning will enhance their overall workload and regulates them through productivity bargaining. Another fear that they entertain is that it would lead to widespread unemployment, especially of unskilled labour.
Problem # 7. Uncertainties:
In view of the rapid changes in the environment there are a great number of uncertainties like is risky to depend upon general estimates of manpower, absenteeism, turnover, seasonal employment, technological changes and market fluctuations there uncertainties work as constraints to manpower planning. Although discounts are made for these factors, while preparing the plan, but these factors cannot be estimated correctly.
Problem # 8. Management Information System:
Effectiveness of planning depends upon the reliability of the information system. In most of the Indian industries, human resource information system has not fully developed. In view of the lack of reliable data, it would not be possible to have effective planning.
Problem # 9. Coordination with Other Managerial Functions:
It is often observed that the manpower planners, like to remain aloof from other operating managers and to become totally absorbed in their own standard. To be effective, manpower planning must be integrated with other management functions.
Problem # 10. Unbalanced Approach:
It is said that most of the human -resource experts have unbalanced approach. The reason is they give more importance on the quantitative aspect of manpower only. They do it to ensure that there is adequate flow of people in and out of die organisation. They overlook the qualitative aspects like career development and planning, skill levels, morale, etc., are overlooked by them.
It is evident that such unbalanced approach affects the effectiveness of manpower planning. Hence, manpower planning have two types of problems. One is inherent due to the problems of forecasting and second comes from human weaknesses.