Human resource planning is the term used to describe how companies ensure that their staff is the right staff to do the jobs. It is a systematic process of matching the interest, skills, and talents of individual community members with the long term goals and economic opportunities in the community. This process anticipates and maps out the consequences of business strategy on an organization's human resources. It is reflected in planning of skill and competence needs as well as total headcounts. For resourcing strategies to be implemented they must be translated into practical action. The strategic process can be organized logically. For these decisions to be taken, information must be obtained, consequences gauged, political soundings taken and preferences assessed.
A clear Human resource plan includes benefits such as:
Highlighting opportunities for strategic partnership that allow communities and other partners to share the benefits, risks and training costs.
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It provides for small successes that are encouraging and motivating for the community members and others that the program is on track.
Making it easy to evaluate progress (especially client feedback) and to present funders, partners, and community members with effective information about the progress.
The Human Resource Planning Process
In order to compartmentalize the Human Resource Planning process, it will be broken down under five main general headings, under which each company will be analyzed against, so that the contrast in how they differ in planning processes can be identified
The first step in the human resource planning process is to understand the context of human resource management. Human resource managers should understand both internal and external environments. Data on external environments includes the following: the general status of the economy, industry, technology and competition; labor market regulations and trends; unemployment rate; skills available; and the age and sex distribution of the labor force. Internal data required include short- and long-term organizational plans and strategies and the current status of the organization's human resources.
In Standard Chartered, Human Resource Managers have surveyed the environmental arena and have undertaken activities that enhance their business performance now and for the long-term. They have also look for ways to ensure the economic development of the countries Standard Chartered Bank operates in, how to have a positive impact on the environment and society, as well as contributing to good governance. Human Resources have helped maintain an integrated view of how Standard Chartered does business - that takes into account economic factors, the environment, community, and good governance.
They have identified seven sustainability priorities by consulting key stakeholders such as government, academics, socially responsible investors, non-governmental organizations (NGOs) and peers. They now deliver on this agenda by using the core skills and talents of their employees; providing quality financial services; and leveraging Standard Chartered Bank's geographical footprint and international status to be a 'force for good'. Standard Chartered Bank's Human Resource Managers have thus analyzed its environment and have enhanced their labor and employment practices through collective bargaining agreements with the Local Unions and focused interaction with all labor regulatory authorities and agencies thus demonstrating the promotion of the principles of human and labor rights. The Bank also has a Diversity & Inclusion (D&I) Council.
Designing the Management System
A proper concise system is a vital necessity and needs to be in place, in order to handle the Human Resource process. The overall aim of this system is to manage human resources in line with organizational goals. The system is in charge of human resource plans, policies, procedures and best practices.
For example, the system should track emerging human resource management trends, such as outsourcing certain non-core functions, adopting flexible work practices and the increased use of information technology, and, if appropriate, implement them.
Standard Chartered Bank has signed a seven-year outsourcing contract, worth US$200 million, with Atos Origin for the management of its data services infrastructure in the Asia Pacific region. The agreement covers the bank's data services in Hong Kong, Singapore and Malaysia. Atos Origin says it will aim to deliver improved performance levels and costs to the bank through the deployment of new technology and the standardization of processes.
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Commercial banks Human Resource system took a different approach and identified a more lucrative benefit can be made by outsourcing their existing pension scheme. Thus it resulted in the bank hiring Hewitt Outsourcing Services (India) Ltd, to convert its existing pension scheme, from a defined benefit plan to a defined contribution plan. As a result the group post-tax profits rose 39.46 percent to 2.37 billion rupees during the nine month period, compared with the same period last year.
Organizations can hire personnel from internal and external sources. The skill inventories method is one of the techniques used to keep track of internal supply. Skill inventories are manual or computerized systems that keep records of employee experience, education and special skills. A forecast of the supply of employees projected to join the organization from outside sources, given current recruitment activities, is also necessary.
For example, Standard Chartered, during the recession, Human Resource analyzing the surplus in employees, and having to cost cut to coincide with the new survival strategies of the company started to take attrition approach. Attrition is the process whereby the existing employees leave their jobs for various reasons or gets downsized. Those jobs will be kept vacant or unfilled. Attrition or hiring freezes or ban on employment can be implemented organization-wide or department-wise or job-wise if the Human Resource Manager forecasts a surplus manpower in the organization. But if the attrition rate is continuous and high then it is high time the concerned authorities in the organization have introspection and take remedial actions. High Attrition is a sign of bad reputation for the organization as a working place.
Under the analyzing supply in terms of Human Resource planning process Commercial Bank operates on a different avenue. If future surplus is estimated, Commercial Bank has to plan for redeployment, redundancy etc. If surplus is estimated in some jobs/department, employees can be redeployed in other jobs/departments where the deficit of employees is estimated. Commercial Bank also makes plans for training or reorientation before redeployment of employees. Redeployment takes place in the form of transfers. If the deficit is not estimated in any job/department and surplus is estimated for the entire organization, Commercial Bank then, starts consultation with the trade unions and plans for redundancy or retrenchment.
Reconciliation and Planning
The final step in human resource planning is developing action plans based on the gathered data, analysis and available alternatives. The key issue is that the plans should be acceptable to both top management and employees. Plans should be prioritized and their key players and barriers to success identified. Some of these plans include employee utilization plan, appraisal plan, training and management development plan and human resource supply plan.
A good example of this would be to go back to the times where recession hit, and Standard chartered had done extensive research on employee utilization plan, and more importantly the downsizing to keep them afloat. The HR identified key managers and put into action a redundancy plan which was as followed:
Standard Chartered redundancy plan
This plan covered type and number of employees, time of and place of retrenchment, type of help to be extended to retrenched employees in the form of compensation, help in getting new job, priority in filling future vacancies.
Redeployment, Redundancy/Retrenchment Programs:
Outplacement programs also intended to provide career guidance for displaced employees. This programs covers retraining the prospective displaced employees who can be redeployed elsewhere in the organization, helping in resume writing, interview techniques, job searching.
Layoffs can be temporary or permanent. Temporary layoffs are due to the slackness in business, machinery breakage, power failure etc. Workers are called back as soon as work resumes to the normal position. Permanent layoff is due to liquidation of the company. Proper human resource planning leaving the workforce at proper level can help to reduce this effect.
3. Leave of Absence without Pay:
This technique helps SC to cut the labor cost and the employee to pursue his self interests. This technique also helps the company to plan for eliminating the unnecessary job in a phased manner. This concept serves or a productive method to help employees prepare for future changes.
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Some areas of SC offer employees the opportunity to share jobs or two employees working one-half time each. This technique solves the problem of retrenchment in the short run. This is in vogue in advanced countries but not acceptable to workers unions especially within the Asian region.
Reduced Working Hours:
Under this technique, each worker, works less hours, and receives less pay, so that two jobs are saved. Again this is not prevalent in the Asian region and other developing countries.
Voluntary/ Early Retirement:
Another issue is early retirement. SC has taken a page from the Government of India who introduced Voluntary Retirement Scheme under the caption 'Golden Handshake' in order to solve the problem of overstaffing in Public sector. This technique solves the problem of excessive supply of future inventory over the demand for the human resources. In short it is popularly called as VRS.