HUMAN RESOURCE PLANNING

What Is Human Resource Planning?

Human resource planning identifies the present and foreseeable demands of human resources that an organization will
require to reach its objectives. It aims to act as a link between human resource management and an organization’s
overarching strategic plan.

It converts the organization’s objectives

and plans into an estimated number of
employees required to achieve those goals.
Estimating the quantity and type of
personnel the firm will need over the next
several months is the primary step in the
human resource process. Businesses that
train employees to expand capacity and
build skills will see their workforce grow.

Human resource planning - concept is a tactic businesses use to keep a regular flow of qualified workers while preventing
staff surpluses or shortages. A company’s productivity and profitability can increase with a robust plan.
The planning process generally consists of four steps: assessing the present employee supply, forecasting the workforce,
balancing labor supply and demand, and creating plans that support the firm’s objectives.

Human Resource Planning Explained - Identifying the organization’s current human resource requirements and figuring
out how to hire them are included in planning. Strategic human resource planning serves as a blueprint for the current state
of the workforce and future human resource requirements. A firm’s operations plan and its total human resources
management are connected by such planning. Human resource planning needs are a projection of the fire plan’s acquisition
and use of human resources. The planning of an organization’s human resources, including hiring, screening, paying,
training, designing jobs, and setting work standards, is collectively referred to as human resource planning.
The organization’s human resources department is in charge of planning its human resources and organizing its hiring
process. The planning process aids the business in determining the kind of talent it requires and which departments
might profit from adding fresh talent. Maintaining a company’s profit and productivity levels depends on hiring the proper
type of qualified workers.

Steps / Process - Forecasting the organization’s demand for and supply of human resources is done through the planning
process.
- Choosing the Goals: Determining the goals for which the process will be carried out is the first step in every cycle.
For example, to choose the correct number of people for the right job, it is essential to identify the goal for which workforce
planning is to be done.
- Examine the present personnel supply: use the data saved about the staff’s expertise, competency, abilities, etc., to
carry out a specific job. Additionally, it is possible to predict future openings to plan for the workforce from internal (inside
the current employees) and external (hiring applicants from outside) sources. I
- Estimating Demand and Supply: After maintaining an inventory of skilled employees, the next stage is to match
anticipated future demand for employees with the organization’s current supply of resources.
- Action plan: Once the staffing shortfalls have been assessed, an employment or action plan should be created. If
there is a shortfall, the company may pursue recruitment, training, or interdepartmental transfer plans; if there is a surplus,
the company may pursue voluntary retirement plans, redeployment, transfer, or layoffs.
- Training and Development: Training is provided for both current personnel and new hires, as both groups must
periodically upgrade their skill sets.

Factors - Various internal and external influences influence the planning of human resources. Some of them are:
- Organizational type: The organizational type impacts Human Resource strategy. Two factors—the nature of the
company and the ownership structure—can be used to determine the kind of organization.
- Organizational approach to planning: Different businesses use various methods for overall planning. These
strategies can be divided into proactive or reactive and informal or formal. In an aggressive approach, a company projects
the future and bases its strategic choices on that projection.
- Organizational development cycle: Organizations go through several stages of development: birth, childhood,
adolescence, middle age, and old age. At every step of the growth cycle, organizational goals and strategic priorities impact
human resource planning.
- Time horizon: Planning for human resources has a time horizon. More ambiguity exists in Human Resource
formulation as the time horizon gets longer. This is because it is incredibly challenging—and occasionally even impossible—
to foresee the future environment accurately when it is unpredictable.
- Information type and quality: Since information is used to develop Human Resource plans, the effectiveness of
human resource planning work depends on the quality and type of information.

Example - Suppose a garments firm ABC Ltd needs help with the supply of staff. First, it will analyze the organization’s
goals and departmental needs. After this, it will examine the collection available to the organization and plan to fill the vacant
positions. Continuous training is the last but not minor step of this process. Timely feedback from management and
employees ensures the effectiveness of the staffing position.

Advantages & Disadvantages

The advantages and disadvantages of the planning process can be understood in the following ways.
Advantages - The advantages of such planning are:
- Building abilities – Workers will work more effectively thanks to such planning. In addition, businesses will grow
professionally with the present employees instead of depending on independent contractors if they provide the education
and training required to develop skills and improve capacity.
- Enhancing retention – Employee retention is higher if they demonstrate appreciation by spending time and money
to provide them with the resources they need to advance. In addition, it will make their employees more excited and let
them know they appreciate their contribution and length of service.
- Predictability – The market environment, the state of the economy, and supply chain difficulties present enough
daily uncertainty for the company. By adding an extra layer of certainty to scheduling, staffing, and managing ongoing
workload, putting thought and planning into providing employees with what they require to perform a good job and remain
firm over time helps alleviate some of this determinism.
Disadvantages - Disadvantages of such planning are:
- Expensive – Training and putting money into employees is expensive. Therefore, planning may reduce the bottom
line in the near term before it enhances profits, whether spending on specialized training or taking employee time away from
jobs that are more likely to increase incoming income immediately.
- Unpredictability – There is no assurance that the employee’s train will remain with the firm sufficiently to realize
the advantages of investment, even if planning for human resources can offer the business a better degree of stability through
improving personnel capabilities.
- Illusionary – Planning for human resources can improve the workforce’s ability to do their roles. Still, it can prepare
them to carry out outdated tasks as businesses and industries develop. As a result, they can experience a false sense of safety
and not respond to situations quickly enough.

Difference Between Human Resource Management and Human Resource Planning

The strategic and cohesive approach to managing people in an organization or company in a way that gives them
a competitive advantage is known as human resource management. While later is the procedure used by management to
decide how to move an organization from its existing personnel position to its target staffing position.
Some of the fundamental difference between them is:

Basis Human Resource Management Human Resource Planning

Method Conventional Contemporary

Nature
of Routine Strategic
function

Primarily on routine tasks like hiring, paying, Treat the organization’s workforce as a valuable resource
Focus
training, and maintaining employee harmony. that should be utilized, respected, and conserved.
Manpower Planning vs Human Resource Planning
Manpower planning is the strategy for acquiring, utilizing, improving, and preserving an organization’s human resources.
While human resource planning is a continuous process that a business uses to systematically plan for the future of its human
resources to fill open positions with qualified candidates.
Human resource planning and workforce planning are very different in the following manner.
In human resource planning, managers are concerned with motivating employees, a process in which cost, numbers, control,
and systems mix and play a role. Regarding workforce planning, executives are concerned with the quantitative aspects of
forecasting availability, demand matching, and management, which include people.
Manpower planning was once thought of as a strategy for securing the company’s human resources, which involved hiring
the proper quantity of people with the necessary skills at the correct time. The primary objective was to match up the supply
and demand of labor.
Demand is the term used to describe the organization’s present and future needs for human resources. At the same time,
supply is the extent to which the current workforce may satisfy those needs internally and externally.

Points for consideration

1. What is strategic human resource planning?
It aids organizations in determining their present and future needs for human resources to accomplish their objectives. It
connects an organization’s overarching strategic plan and human resource management.
2. Why is forecasting important in human resource planning?
Using Human Resource forecasting and analysis, one can predict turnover caused by retirement or market competitiveness.
A new product’s production, a shift in the target market, or the addition of new labor or manufacturing rules are just a few
examples of how it can assist in analyzing how corporate strategy changes will affect the workforce.
3. How to overcome problems in human resource planning?

The following must be monitored to go through these obstacles:

1. Run a preliminary needs and requirements analysis.
2. Develop the approach and gain support for it.
3. Examine all potential barriers.
4. Plan actions.
5. Implementation under project management.
6. Follow up and assess development so corrective action can be performed as needed.

4 steps to strategic human

resources planning
It’s easy to understand the importance
of the human resource management
planning process—the process by
which organizations determine how
to properly staff to meet business
needs and customer demands. But
despite its obvious importance, many
organizations do not have a strategic
human resource planning process in
place, with many HR professionals
reporting their departments need to
improve strategic alignment. If you’ve
considered developing an HR
planning process, you’re in the right
place. This article will explain what
human resource planning entails and
how to document your strategic plan.
With this knowledge under your belt,
you’ll be filling positions and growing
as a company in no time.
4 Steps to Strategic Human Resource Planning
Introduction to strategic human resource planning
In order to improve the strategic alignment of staff and other resources, it’s essential to understand how to create a strategic
HR planning process. At its most basic level, strategic human resource planning ensures adequate staffing to meet your
organization’s operational goals, matching the right people with the right skills at the right time.
It’s important to ask where your organization stands currently and where it is going for your plan to remain flexible. Each
company’s plan will look slightly different depending on its current and future needs, but there is a basic structure that you
can follow to ensure you’re on the right track.
The strategic human resource planning process begins with an assessment of your current staff, evaluating whether it fits
the organization’s needs. After that, you can move on to forecasting future staffing needs based on business goals. From
there, you’ll need to align your organization’s strategy with employment planning and implement a plan to not only to hire
new employees but also to retain and properly train the new hires—and your current employees—based on business
changes.

1. Assess current HR capacity

The first step in the human resource planning process is to assess your current staff. Before making any moves to hire new
employees for your organization, it’s important to understand the talent you already have at your disposal. Develop a skills
inventory for each of your current employees.
You can do this in a number of ways, such as asking employees to self-evaluate with a questionnaire, looking over past
performance reviews, or using an approach that combines the two. Use the template below to visualize that data.

Skills Inventory by Department (Click on image to modify online)

2. Forecast HR requirements
Once you have a full inventory of the resources you already have at your disposal, it’s time to begin forecasting future needs.
Will your company need to grow its human resources in number? Will you need to stick to your current staff but improve
their productivity through efficiency or new skills training? Are there potential employees available in the marketplace?
It is important to assess both your company’s demand for qualified employees and the supply of those employees either
within the organization or outside of it. You’ll need to carefully manage that supply and demand.
Demand forecasting
Demand forecasting is the detailed process of determining future human resources needs in terms of quantity—the number
of employees needed—and quality—the caliber of talent required to meet the company's current and future needs.
Supply forecasting
Supply forecasting determines the current resources available to meet the demands. With your previous skills inventory,
you’ll know which employees in your organization are available to meet your current demand. You’ll also want to look
outside of the organization for potential hires that can meet the needs not fulfilled by employees already present in the
organization.
Need advice on calculating your staffing needs and developing a staffing plan?
We have you covered
Matching demand and supply
Matching the demand and supply is where the hiring process gets tricky—and where the rest of the human resources
management planning process comes into place. You’ll develop a plan to link your organization’s demand for quality staff
with the supply available in the market. You can achieve this by training current employees, hiring new employees, or
combining the two approaches.

Skills Supply and Demand Chart (Click on image to modify online)

3. Develop talent strategies

After determining your company’s staffing needs by assessing your current HR capacity and forecasting supply and demand,
it’s time to begin the process of developing and adding talent. Talent development is a crucial part of the strategic human
resources management process.

Overview of the Talent Development Process (Click on image to view in Lucidchart)

Recruitment - In the recruitment phase of the talent development process, you begin the search for applicants that match
the skills your company needs. This phase can involve posting on job websites, searching social networks like LinkedIn for
qualified potential employees, and encouraging current employees to recommend people they know who might be a good
fit.
Selection - Once you have connected with a pool of qualified applicants, conduct interviews and skills evaluations to
determine the best fit for your organization. If you have properly forecasted supply and demand, you should have no trouble
finding the right people for the right roles.
Hiring - Decide the final candidates for the open positions and extend offers.
to find the best candidates for your company.
Training and development - After hiring your new employees, it's time to bring them on board. Organize training to get
them up to speed on your company’s procedures. Encourage them to continue to develop their skills to fit your company’s
needs as they change. Find more ideas on how to develop your own employee onboarding process, and then get started
with this onboarding timeline template.

Timeline for Onboarding

Employee remuneration and benefits administration - Keep your current employees and new hires happy by offering
competitive salary and benefit packages and by properly rewarding employees who go above and beyond. Retaining good
employees will save your company a lot of time and money in the long run.
Performance management - Institute regular performance reviews for all employees. Identify successes and areas of
improvement. Keep employees performing well with incentives for good performance.
Employee relations - A strong company culture is integral in attracting top talent. Beyond that, make sure your company is
maintaining a safe work environment for all, focusing on employee health, safety, and quality of work life.

4. Review and evaluate

Once your human resource process plan has been in place for a set amount of time, you can evaluate whether the plan has
helped the company to achieve its goals in factors like production, profit, employee retention, and employee satisfaction. If
everything is running smoothly, continue with the plan, but if there are roadblocks along the way, you can always change up
different aspects to better suit your company’s needs.
Why document your strategic HR plan? Now that you know the steps to strategic human resource planning, it's time to
adapt those steps to your own organization and determine how to execute.
There are a number of reasons to document your strategic human resources plan, particularly in a visual format like a
flowchart. Through documentation, you standardize the process, enabling repeated success. Documentation also allows for
better evaluation, so you know what parts of your plan need work. In addition, a properly documented plan allows you to
better communicate the plan throughout the organization, including how everyone, from the top down, can contribute to
make sure the plan works.
Document every step of the process, from beginning to end, and find room for improvement in your human resources
process along the way.
Human resource planning enables businesses to meet their current and future demands for talent, allowing human resource
managers to anticipate and develop the skills most valuable to an organization, and providing the enterprise with the optimal
balance of staff in terms of available skill-sets and numbers of personnel. Proper planning also provides a path for future
development by establishing a reservoir of talent capable of filling leadership roles. And in the long term, human resource
planning helps align human capital management more closely with business strategy.

What Is Human Resource Planning?

Beyond a simple consideration as the workforce, the human resources of an organization represent the sum of knowledge,
skills, aptitude, creative abilities, and talents available to the enterprise, in addition to the values, attitudes, and benefits that
each individual contributes to the business.
Human resource planning is a systematic and strategic process aimed at evaluating the current state of an organization’s
human resources and predicting its future workforce requirements. Also known as workforce planning, human resource
planning helps organizations recruit, retain, and optimize the deployment of people they require to meet strategic business
objectives and respond to changes in the market and the general environment.
A key part of human resource planning is projecting future workforce requirements and developing strategies for deploying
this talent to avoid skills shortages or surpluses proactively. The aim is to achieve a balance of skills based on the needs and
objectives of the enterprise. HR planning must, therefore, be a continuous process, with a structure and monitoring
system that enables the organization to provide sufficient lead time for the recruitment and training of employees to meet
its future requirements.

HR Planning Methodology
While forecasting workforce demand is at the heart of human resource planning, HR professionals require a comprehensive
and in-depth view of their organization and an understanding of multiple factors to put together a plan. Smartsheet.com
identifies seven key steps in the planning process, which may be applied in terms of their relevance to the circumstances of
a specific enterprise:
Step One: Analyze the
objectives of your organization
Step Two: Make an inventory
of current human resources
Step Three: Forecast your HR
demand
Step Four: Determine the
number and extent of skills
gaps
Step Five: Draw up an action
plan
Step Six: Integrate and
implement the plan
Step Seven: Monitoring,
measurement, and feedback

(Image source: Smartsheet.com)

The Benefits and Implications of Human Resource Planning
In a globalized economy fueled by technological innovation, changing work patterns, demographic or cultural shifts, and
changes in customer behavior, the life cycles of business designs and products are shortening – and organizations must be
able to adapt swiftly. Human capital is more flexible in this regard than physical infrastructure or finance, and the strategies
that a business adopts to survive and thrive must take the management of this vital human resource into account.
Organizations around the world are recognizing the importance of this. For example, 2020 HR statistics reveal that 89%
of medium-to-large companies have started using comprehensive annual surveys for engagement assessment.
These studies are assisting them in understanding their workforce better and learning how to keep employees motivated and
productive. Businesses are also appreciating the importance of making a good first impression on their prospective
employees, and providing an incentive for them to fit into the organization and work enthusiastically for its success. Human
resources statistics from 2019 indicate that 87% of applicants make a positive evaluation of the company and position they’re
applying to, after a positive interview and onboarding experience. The reverse also holds, with 83% of applicants who
reported a negative interview experience changing their initially positive opinion about the company and the position they’re
applying to.
Moving forward, human resource planners will not only have to face the adoption of new digital processes and technologies
— they will also have to accommodate new methods of doing business, and new realities such as the ongoing COVID-19
pandemic, with its movement restrictions and emphasis on remote working and collaboration. They will likely have to
develop new methodologies for nurturing and retaining existing skills and cast a broader net in discovering new talent.
Matthew Burr, Moderator of the Upstate HR Podcast and Principal at human resource consulting firm Burr Consulting,
LLC, sums it up like this: “The war for talent around the world continues to grow. To win the human capital competition,
companies should use a strategic human resource plan as a roadmap to achieve three- to five-year goals. Strategic plans
influence the development of tactical resource planning. For example, a human resources strategic plan may include long-
term aims to recruit and retain excellent staff with a high level of technical expertise. The tactical plan would include detailed
action plans with completion due dates. For the strategic recruitment goals, the tactical program might consist of short-term
goals, such as benchmarking salaries via survey data, or creating a social media campaign to identify and recruit technical
professionals. The plan may also target filling IT positions through international recruiting.”

What Human Resource Planning Brings to the Organization

Deployed effectively, HR planning enables a business to optimize its usage of human resources, increasing productivity
while reducing labor turnover, employee unrest, and absenteeism. It’s important to the enterprise in several respects.
The five business management functions of planning, organizing, leading, directing, and controlling rely on the
oversight and action of human resources planners for their effective execution. At the organizational level, good HR
planning enables the enterprise to optimize its deployment and utilization of available talent, and to recognize earlier and in
more detail the need for additional or alternative skills.
Besides optimizing its usage of skills, the planning function also provides the organization with a clearer path to the future,
both in terms of anticipating skills requirements and creating an order of succession for the promotion and shifting of talent
within the corporate hierarchy. Strategic workforce planning enables managers to more easily adapt to changes when
employees retire or leave the organization, and when it comes time to promote or transfer personnel.
In times of economic uncertainty, human resource planning becomes a value add for the organization, with its power to
foresee and avoid short-sighted staffing decisions. For example, unnecessary downsizing may result in costs to the enterprise
due to the possibility of backlash from worker’s unions, and the immediate loss of skilled personnel whose replacement will
require time, effort, expense, and training.
For the worker, a comprehensive and well-executed HR plan can provide improved communications with management and
a greater connection with the vision and objectives of the enterprise. A human resources scheme with provision for
incentives can also increase the worker’s engagement with the organization, their commitment to its progress, and their
sense of job satisfaction.

The Challenges Facing HR Planners

Besides the difficulty inherent in the core function of predicting workforce requirements based on business projections, a
number of challenges face human resource professionals in effective planning.

Human Resource Planning in Action

Ideally, HR professionals should be system and integration project managers who understand deadlines and highly complex
projects. Many academic institutions offer a degree path in Human Resources Management, and certification programs are
available to qualified individuals coming from various fields. Within the organization, employees will often work within an
HR role for three to five years, before attaining management level.
(Image source: Atrivity.com)

Besides nurturing in-house talent, HR experts suggest a number of strategies for effective planning.
Organizational policies such as employment classification, benefits, compensation, performance, and improvement can
assist human resource planners with the selection, training, and support of workforce members, and provide employees
with guidelines for conduct and orientation in and outside the work environment.
Social media platforms like LinkedIn and Twitter can aid in recruitment and provide an engaging platform for workers to
communicate with the organization and each other. But it’s important to carefully monitor these platforms and take
corrective action when the social media buzz runs counter to the objectives or brand image of the business.
In terms of implementation, the most effective organizations use proactive human resource plans, which anticipate business
needs and develop strategies that achieve short term and long-term objectives. Such plans will employ progressive practices
such as allocating a portion of the staffing budget and resources to recruitment and the hiring of key talent for future-looking
projects.

Outsourcing Options for HR Planning and Management

We’ve mentioned the time, effort, and expense involved in human resource planning, and these commitments may
discourage smaller-scale enterprises from getting involved in the process at all. Professional employer organizations (PEOs)
can provide a viable and cost-effective alternative to in-house efforts.
PEOs operate under a “co-employment” model where the business retains effective control of its workforce, deciding
whom to hire and fire, and managing their day-to-day activities. But for tax and compliance purposes, the employees appear
as a legal entity on the PEO’s books. The PEO also takes responsibility for all the legal, compliance, and HR-related policy
tasks that the client business defines.
NAPEO, a national organization representing PEO interests, reckons that there are roughly 900 PEOs operating in the US.
Most operate on short-term contracts, usually requiring a 30-day written notice if you need to cancel their services.
Final Thoughts
Besides creating a smooth and efficient process for employee management and future workforce development, human
resource planning gives business leaders more freedom to focus on meeting goals that drive revenue for the enterprise,
rather than having to deal with administrative issues and employee documentation. And with a number of options available,
HR planning isn’t restricted to huge corporations having hundreds of people on their HR teams — it’s accessible to small
and medium-sized businesses, as well.
Summary:
Why Is Human Resource Planning Important?
Human resource planning (HRP) allows a business to better maintain and target the right kind of talent to employ—having
the right technical and soft skills to optimize their function within the company. It also allows managers to better train the
workforce and help them develop the required skills.

HR statistics in the US suggest that companies lose $550 billion annually due to workers feeling dissatisfied or disengaged.
Businesses are therefore wise to lay greater emphasis on building a healthy organizational structure that motivates the
workforce, and on promoting healthy communications between management and employees. Effective management and
planning for human resources can assist in this. Human resource planning enables businesses to meet their current and
future demands for talent, allowing human resource managers to anticipate and develop the skills most valuable to an
organization, and providing the enterprise with the optimal balance of staff in terms of available skill-sets and numbers of
personnel. Proper planning also provides a path for future development by establishing a reservoir of talent capable of filling
leadership roles. And in the long term, human resource planning helps align human capital management more closely with
business strategy.

What Is "Hard" vs. "Soft" Human Resource Planning?

Hard HRP evaluates various quantitative metrics to ensure that the right number of the right sort of people are available
when needed by the company. Soft HRP focuses more on finding employees with the right corporate culture, motivation,
and attitude. Often these are used in tandem.1

Human Resource Planning

What Is Human Resource Planning (HRP) Used For?
Human resource planning allows companies to plan ahead so they can maintain a steady supply of skilled employees. The
process is used to help companies evaluate their needs and to plan ahead to meet those needs.
Human resource planning needs to be flexible enough to meet short-term staffing challenges while adapting to changing
conditions in the business environment over the longer term. HRP starts by assessing and auditing the current capacity of
human resources.
Here, identifying a company's skill set and targeting the skills a company needs enables it to strategically reach business goals
and be equipped for future challenges. To remain competitive, businesses may need advanced skills or to upskill their
employees as the market environment evolves and changes.
To retain employees and remain competitive, HRP often looks at organizational design, employee motivation, succession
planning, and increasing return on investment overall.

Challenges of Human Resource Planning (HRP)

The challenges to HRP include forces that are always changing. These include employees getting sick, getting promoted,
going on vacation, or leaving for another job. HRP ensures there is the best fit between workers and jobs, avoiding shortages
and surpluses in the employee pool.

To help prevent future roadblocks and satisfy their objectives, HR managers have to make plans to do the following:
Find and attract skilled employees.
Select, train, and reward the best candidates.
Cope with absences and deal with conflicts.
Promote employees or let some of them go.
Investing in HRP is one of the most important decisions a company can make. After all, a company is only as good as its
employees, and a high level of employee engagement can be essential for a company's success. If a company has the best
employees and the best practices in place, it can mean the difference between sluggishness and productivity, helping to lead
a company to profitability.

What Are the Four Steps to Human Resource Planning (HRP)?

There are four general, broad steps involved in the human resource planning process. Each step needs to be taken in
sequence in order to arrive at the end goal, which is to develop a strategy that enables the company to successfully find and
retain enough qualified employees to meet the company's needs.
- Analyzing labor supply - The first step of human resource planning is to identify the company's current
human resources supply. In this step, the HR department studies the strength of the organization based on the number of
employees, their skills, qualifications, positions, benefits, and performance levels.
- Forecasting labor demand - The second step requires the company to outline the future of its
workforce. Here, the HR department can consider certain issues like promotions, retirements, layoffs, and transfers—
anything that factors into the future needs of a company. The HR department can also look at external conditions
impacting labor demand, such as new technology that might increase or decrease the need for workers.
- Balancing labor demand with supply - The third step in the HRP process is forecasting the
employment demand. HR creates a gap analysis that lays out specific needs to narrow the supply of the company's labor
versus future demand. This analysis will often generate a series of questions, such as:
Should employees learn new skills?
Does the company need more managers?
Do all employees play to their strengths in their current roles?
Developing and implementing a plan
The answers to questions from the gap analysis help HR determine how to proceed, which is the final phase of the HRP
process. HR must now take practical steps to integrate its plan with the rest of the company. The department needs a budget,
the ability to implement the plan, and a collaborative effort with all departments to execute that plan.
- Common HR policies put in place after this fourth step may include policies regarding vacation, holidays, sick days,
overtime compensation, and termination.

What Is the Goal of Human Resource Planning (HRP)?

The goal of HR planning is to have the optimal number of staff to make the most money for the company. Because the
goals and strategies of a company change over time, human resource planning must adapt accordingly. Additionally,
as globalization increases, HR departments will face the need to implement new practices to accommodate government
labor regulations that vary from country to country.
The increased use of remote workers by many corporations will also impact human resource planning and will require HR
departments to use new methods and tools to recruit, train, and retain workers.

What Are the Basic Steps in HRP?

HRP begins with an analysis of the available labor pool from which a company can draw. It then evaluates the firm's present
and future demand for various types of labor and attempts to match that demand with the supply of job applicants.1
The Bottom Line
Quality employees are a company's most valuable asset. Human resource planning involves the development of strategies
to ensure that a business has an adequate supply of employees to meet its needs and can avoid either a surplus or a lack of
workers.
There are four general steps in developing such a strategy: first, analyzing the company's current labor supply; second,
determining the company's future labor needs; third, balancing the company's labor needs with its supply of employees; and
fourth, developing and implementing the HR plan throughout the organization.
A solid HRP strategy can help a company be both productive and profitable.