Manpower planning-HRM

The penalties for not being correctly staffed are costly.

• Understaffing loses the business economies of scale and specialization, orders, customers and profits.
• 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.

Planning staff levels requires that an assessment of present and future needs of the organization be compared with present resources and future predicted resources. Appropriate steps then be planned to bring demand and supply into balance.

Thus the first step is to take a 'satellite picture' of the existing workforce profile (numbers, skills, ages, flexibility, gender, experience, forecast capabilities, character, potential, etc. of existing employees) and then to adjust this for 1, 3 and 10 years ahead by amendments for normal turnover, planned staff movements, retirements, etc, in line with the business plan for the corresponding time frames.

The result should be a series of crude supply situations as would be the outcome of present planning if left unmodified. (This, clearly, requires a great deal of information accretion, classification and statistical analysis as a subsidiary aspect of personnel management.)

What future demands will be is only influenced in part by the forecast of the personnel manager, whose main task may well be to scrutinize and modify the crude predictions of other managers. Future staffing needs will derive from:

• Sales and production forecasts
• The effects of technological change on task needs
• Variations in the efficiency, productivity, flexibility of labor as a result of training, work study, organizational change, new motivations, etc.
• Changes in employment practices (e.g. use of subcontractors or agency staffs, hiving-off tasks, buying in, substitution, etc.)
• Variations, which respond to new legislation, e.g. payroll taxes or their abolition, new health and safety requirements
• Changes in Government policies (investment incentives, regional or trade grants, etc.)

What should emerge from this 'blue sky gazing' is a 'thought out' and logical staffing demand schedule for varying dates in the future which can then be compared with the crude supply schedules. The comparisons will then indicate what steps must be taken to achieve a balance.

That, in turn, will involve the further planning of such recruitment, training, retraining, labor reductions (early retirement/redundancy) or changes in workforce utilization as will bring supply and demand into equilibrium, not just as a one–off but as a continuing workforce planning exercise the inputs to which will need constant varying to reflect 'actual' as against predicted experience on the supply side and changes in production actually achieved as against forecast on the demand side.